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|Social enterprise business models: identifying the trading concepts that inform them.
|Entrepreneurship, Commercialisation and Innovation Centre (ECIC)
|Social enterprises provide services and goods to alleviate social problems, and adopt business models to ensure financial sustainability. Differentiated from commercial enterprises due to their primary social mission, and from traditional nonprofit organisations due to their implementation of trading activities, little is known about how social enterprises understand the term “business model”, what the business models of social enterprises are, or what informs them. It is also unclear whether any particular social enterprise business model may confer a financial advantage. Although the business model construct is not yet clearly defined in the literature, there is a general understanding that business models are informed by an organisation’s strategy. In-depth interviews were conducted with Chief Executive Officers of 65 nonprofit social enterprises from a diverse range of sectors in Australia. Four research questions are addressed using concept mapping and Qualitative Comparative Analysis (QCA). These research methods combine qualitative insights with quantitative analysis, provide transparent research processes, allow for contextual generalizations, and offer deeper insight into an increasingly important sector of the economy. Despite growing consensus that the business model is driven by an organisation’s strategy, the operational components remain ambiguous. Business model definitions provided by the 65 CEOs were examined, similar statements were linked together, and, using a social network analysis software tool, a concept map was generated. The five resulting clusters revealed that participants defined business models as: “Sustainable revenue stream”, “Organisational form”, “Value chain”, “Business plan”, and “Unclear”. Although several of these clusters correspond with the literature, these inconsistencies clearly demonstrate that the business model has multivalent characteristics, and that investigating the business models as provided by participants would not provide useful or valid findings. The researcher therefore examined trading activity statements provided by the participants to articulate the trading concepts, or strategy, that informs this sector’s business models. Similar trading activities were linked, a concept map was generated, and five distinct trading concepts were identified after close examination of the trading activities included in each cluster: “Safety nest”, “Activity coaching”, “Needs distribution”, “Social expertise”, and “Mission engagement”. To examine whether any particular combination of trading concepts confers a financial advantage, the revenue growth of the social enterprise trading activities was evaluated using QCA. Based on Boolean algebraic logic, QCA revealed that no specific combination is financially advantageous to nonprofit social enterprises, suggesting that each trading concept is equally useful or valid. Social enterprise managers and strategists may use this set of five trading concepts to both appraise existing and creatively design new trading activities. This unusual but relevant application of the concept mapping and QCA methods contributes to a growing area of academic research.
|Lindsay, Noel John
|Thesis (Ph.D.) -- University of Adelaide, Entrepreneurship, Commercialisation and Innovation Centre (ECIC), 2013
|social enterprise; business models; concept mapping; qualitative comparative analysis
|Copyright material removed from digital thesis. See print copy in University of Adelaide Library for full text.
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