So What Is It You Do Again? – Definitions, Numbers, Business Models and Language.

Posted: 14 October 2013, in Blog

So what is it you do again?

What is a social enterprise and how many are there? These ought to be simple questions but of course they are not. No one agrees on definitions, the language and terminology is all over the place and the space between and across the three systems identified by John Pearce and Alan Kay in Social Enterprise in Anytown is awash with folk whom I would never call a social entrepreneur and organisations I would never call a social enterprise.

It is still not enough to tell me about your legal form and think that that covers it. I’m at the stage where I think I have to unlearn stuff about social entrepreneurship and the practice of running social enterprises in order to come at the subject again with a degree of objectivity.

Does any of this matter if folk are receiving services and help with their lives? Where are the lines in the sand and who is drawing them?

Other simple questions that folk have discussed with me are as follows:

  1. Can you explain your social mission in one sentence?
  2. How much do you pay your senior staff and are these linked to private sector, public sector or market rates or did you come up with another figure based on something else?
  3. What proportion of your income comes from trading activities rather than funding and donations? If consistently less than 25%, are you kidding on being a trading business that reinvests its profits into the business.
  4. What are your bottom lines?
  5. Are you a business or a project?
  6. Are you a fair recruiter?
  7. Are you a fair employer?
  8. Have you ever swept a problem under the carpet and failed to let “other” stakeholders know about it?
  9. Would you report a financial issue e.g. suspected crime, pension or cash-flow problem to the police, your insurers, OSCR or a funder? Would you rather deal with this stuff in house to minimise the impact on your business reputation?
  10. Do you support the unionisation of your staff or are you against that because of a unitary frame of reference between staff, board members and clients/beneficiaries?
  11. What are the differences between a social enterprise and the following; a project, a charity, a voluntary organisation and an NGO?
  12. Do you agree that success is serving a small number of folk in your community or changing a paradigm around a social problem or issue? Can it be both – any examples of the big paradigm stuff?
  13. Do you measure your outcomes as well as your outputs?
  14. Would you support the closure of poorly performing social enterprises once reasonable efforts of help/support had been exhausted?
  15. Do you think that the English model of social enterprise loan investment and development is getting further away from the Scottish model and we should have very little to do with those folk/leaders/politicians/financiers pushing that agenda?
  16. What stops social enterprises growing to be big players in their chosen fields? Is it the folk running them (Staff and Boards) or a lack of the following: cash/business nous/ambition/funders/regulators/a strategy/inability or refusal to invest in learning/etc, etc
  17. Is it your ambition to be incorporated into a local government ALEO or similar?

The reason I ask these questions is that over the last year I’ve had conversations about all of this stuff (and more) with folk running what they claim are social enterprises or folk who want to run one. I’m certainly not in a position to gainsay them, even if I wanted to. I was often at a loss what to say because of the way the conversations were framed – philosophically and politically – rather than entrepreneurially. A lot of folk blamed their situation on external “others” for a lack of (continuing) support, funding or business. Many were also uncomfortable with markets and “the cuts” but could see no straightforward way to do something about their predicaments. Business risk was an awkward topic because of the nature of the work that folk do and the folk they work with.

So, here is a final question:

Should social enterprises be exemplars of moral, governance, employer and entrepreneurial behaviour and success, or should the vast majority just focus on survival, incremental improvement and a desire to be as good as they can be?


NOTE: This opinion piece blog does not necessarily reflect the views or beliefs of Social Enterprise Scotland.