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Chapter – 1

INTRODUCTION
Chapter-1

INTRODUCTION

1.1 Background of the Study:

Entrepreneurship is the main strength of economic growth; the economic


development experienced is just due to the prevailing force of entrepreneurship.
What all developed countries have in common all over the world is the presence of
entrepreneurship. Economic development depends on the growth of
entrepreneurship, and the more entrepreneurship grows, infrastructure and all other
indicators of development also grow. As per Bellad (2020), in a very short time,
governments of many countries worldwide have understood and emphasized the
significance of entrepreneurship. They have started working on the basic
groundwork/infrastructure required for the systematic development of
entrepreneurship and made a lot of efforts for its overall growth. A very basic
element of overall development, including society, can be contributed to the detailed
development of entrepreneurship. According to Bheemappa (2015),
entrepreneurship was first used in the business / economic context in the 18th
century by French economist Richard Cantillon, who linked entrepreneurship to risk
and business uncertainty. Based on different characteristics and criteria,
entrepreneurship can be commercial and social entrepreneurship.

The goal of commercial entrepreneurship is profit generation, while the basic


purpose of social entrepreneurship is social value creation (Austin et al., 2006). The
author further states that although commercial entrepreneurship also creates some
social value through job creation, goods and services, and corporate social
responsibility, the primary aim of a commercial entrepreneur is to generate profits
for private gain. Therefore, commercial entrepreneurs will choose their markets

1
expecting a profit basis, while social entrepreneurs will choose their markets on a
societal needs basis. This study is focused on the contribution of social
entrepreneurs to society through social value creation.

Social Entrepreneurship (SE) has become a research area of great importance for
companies and researchers (Kannampuzha & Hockerts 2019; ReyMarti et al., 2016).
Various issues, such as poverty and human well-being, have motivated different
companies to do business with an integrated social drive (Huda et al., 2019; Doherty
et al., 2014). The SE acts as a catalyst for social change, and social entrepreneurs do
not expect any direct monetary benefit from their social ventures (BarberáTomás et
al., 2019). Bygrave and Minniti (2000) found that all entrepreneurship has a social
function, but social entrepreneurship differs from traditional entrepreneurship in its
prime mission of creating social value rather than generating private economic
benefits (Bedi and Yadav 2019; Pless 2012; Santos 2012; Mair et al. 2012)

The terms social entrepreneurship and social entrepreneur were used first
by H. Bowen in 1953 in his book 'Social Responsibilities of the Businessman'. The
terms were used widely in the 1980s and 1990s, promoted by Bill Drayton of
Ashoka and others.

Author Mary (2016) says that social entrepreneurs are individuals or a group of
individuals who create innovative approaches to improve people's living standards
with their main goals to: eradicate poverty; Improve and promote education; Protect
and promote human health; Environmental Protection; Support for agricultural and
rural development; Waste management; Eliminate caste-based inequality and gender
inequality; Promote a safe environment for children and women to protect them
from human trafficking; Protection of the well-being of people with disabilities;
Guarantee a dignified life to the senior citizens, etc.

As per Bellad (2020), the Indian government also encourages such initiatives by
motivating them through grants similar to some private institutions that do the same.
Social entrepreneurship helps in impacting the unprivileged section of society
through various modes that include micro-financing, educational institutions,
medical institutions, etc. The basic purpose of social entrepreneurship is to make

2
positive changes in society instead of making money for themselves. But they are
involved in finance raising activities and donors and investors to sustain their social
entrepreneurial activities.

In summary, India needs social entrepreneurs for overall development. Social


entrepreneurship fills the gap that remains unfulfilled by economic/commercial
entrepreneurship. This makes social entrepreneurs cater to the needs of the neglected
consumer section through exclusive and innovative products/services, helping them
develop their quality of life.

1.2 Introduction to the Problem:

The concept of social entrepreneurship emerged in the 1980s and, since then, has
been gaining more momentum. India is a young country that offers great
opportunities for social entrepreneurs. As per Devi (2016), an entrepreneur is
creative, a critical thinker and highly motivated, and when these attributes are used
to solve social problems, a social entrepreneur is born.

More and more governments are beginning to pay attention to entrepreneurial


policies and then implement strategies to improve the level of entrepreneurship in
their countries (Satar, 2016). Social entrepreneurship is the application of
innovative, practical and sustainable approaches for the benefit of society at large
(Schwab Foundation, 2012). As per Satar, India is a well-known nation for its
entrepreneurial activities carrying the seeds of social concern, and here we have the
field of social entrepreneurship emerging as a powerful tool for addressing social
problems in an entrepreneurial way.

Social entrepreneurship can include many types of careers and professional paths,
from social work and community development to entrepreneurship and
environmental science. Therefore, it is difficult to define who is a social
entrepreneur. Due to the creative, non-traditional strategies used by many social
entrepreneurs, the term "social innovator" is used as a synonym for social
entrepreneurs (Entrepreneurship Campus, 2020). Some researchers have advocated
restricting this term to founders of organizations that depend primarily on earned

3
income (i.e. income earned directly from paying consumers) rather than income
from donations and grants (Entrepreneurship Campus).

In order to define social entrepreneurship more clearly, it is necessary to distinguish


the function of social entrepreneurship from other non-profit and charitable activities
and to determine the boundaries of social entrepreneurship operations (Arun &
Justin, 2016). The authors further say that others have expanded it to include
contract work for public agencies, while others still include donations and grants.

As per ("Social entrepreneurship," 2020), social entrepreneurship in modern society


offers a selfless (altruistic) form of entrepreneurship that centres on the benefits that
society may realize. If a person's motives or behaviours are selfless (altruistic), they
show concern for the welfare and happiness of other people rather than for
themselves. Simply put, entrepreneurship becomes a social endeavour when it
transforms social capital in a way that affects society positively. According to Arun
and Justin (2016), it is considered favourable because social entrepreneurships'
success depends on several determinants related to social impact that traditional
businesses do not focus on. As per the authors, social entrepreneurs recognize
immediate social problems and seek to understand the broader context of a question
that crosses disciplines, fields, and theories. The authors further say that a better
understanding of the social context of the problem enables social entrepreneurs to
mobilize available resources and develop innovative solutions to influence global
society. Their article also informs that, unlike traditional corporate venture capital,
social entrepreneurial venture capital focuses on maximizing social satisfaction, not
profit maximization.

The social goals of a business are as significant as its commercial activities. Social
enterprises are companies that serve social undertakings, and like any enterprise, the
focus of a social enterprise is to create income by bringing goods and services to the
market, but they add value by the ways they use profits to maximize social,
community, or environmental benefits (SENScot, n.d.). They mainly focus on social
problems. According to (Pal et al., 2020), social entrepreneurs initiate innovation by
mobilizing the resources available to build social arrangements in response to social

4
problems. The authors mention that some believe that social entrepreneurship works
as a strong catalyst in society and as a change agent in the social sector. Also, they
have a mission to create and sustain social value, recognizing and rigidly pursuing
new opportunities, engaging in a practice of continuous innovation, adaptation and
learning. Without being limited by resources in hand, they act boldly and exhibit
heightened accountability to the constituencies (Dees, 1998).

All communities and all individuals have strengths and capacities, but often these go
unrecognized. Sometimes people lose the ability to see their own strengths and
capacities when they are in difficult circumstances or have experienced a series of
setbacks. According to authors Terziev and Arabska (2017), a social entrepreneur
is someone who can see the strengths and resources within a community and the
opportunities to mobilize them, and in return, the social entrepreneur's ability to
create something new is greatly enhanced by the community. For example, a
community that attempts to make itself a learning community would be a fruitful
environment for a social entrepreneur. As per (Talbot et al., 2002), a social
enterprise is based upon the enterprising skills of individual people and enterprising
characteristics include using initiatives; carrying on responsibilities; generating
creative ideas; planning; seeking information; flexibility; managing resources;
negotiation and influence; dealing with tension; conflict resolution; monitoring and
evaluating performance; knowledge of key business processes, e.g. marketing.

1.3 Social Entrepreneurs and Social Values:

Social entrepreneurship is a phenomenon that has been evident in both developed


and developing nations and is affecting economies by creating new industries,
validating new business models and redirecting resources to neglected societal
problems (Santos, 2012).

Abu-Saifan (2012) mentions that a social entrepreneur combines a passion for social
mission with the image of discipline, innovation, and professional determination
often associated with it. Also, in this field, entrepreneurs adjust their activities to
directly relate to the ultimate goal of creating social value. The author says that in
doing so, they usually act with little or no personal benefit intentions.

5
There are several problems in our society, and a social entrepreneur is a person who
actively develops innovative ideas and solutions for existing social problems
(Shethna, 2020). The author further states that social entrepreneurs strive to solve
these problems by changing working systems and thinkings, raising awareness on
how to solve these problems, and developing social entrepreneurship resources to
empower people and the community. Also, they try to convince the whole society to
think about different aspects and directions. They develop simple and
straightforward ideas that everyone can understand and can use to grow and improve
society. They aim to identify and create effective agents or models of change to
motivate the masses to develop their own ideas, strategies, and solutions to solve
social problems (Shethna, 2020).

Social entrepreneurship's underlying drive is to create or increase social value(Mair


& Marti, 2006; Peredo & McLean, 2006).

"Social Capital" is defined as something of perceived benefit to individuals and


communities, which others might term "Social values"(Terziev & Arabska, 2017).
There are several ways in which social values can be created. Kiser and Leipziger
(2014), in their article, describes eight ways to create social values. The authors say
that social entrepreneurship does not create social value in a vacuum and social
value mining is a creative process between the company, its stakeholders, and its
management. They further illustrate that the social value is created by considering
the economic, environmental and social aspects of their impact and how they can
enhance well-being and development. To raise awareness of a sector or prepare
employees, the creation of social value requires in-depth training to allow change.

Although today's social entrepreneurs are recognized to create social value by


solving key social needs and developing more effective and problem-solving social
systems, it is difficult to measure and evaluate the results of social value creation.
(Dees, 1998; Leadbeater, 1997). However, some of the contributions of social
entrepreneurs are promoting social cohesion and strengthening social capital.
According to Cheng (2017), Social Value creation has various outcomes, which are
as follows-

6
i) Promoting Social Cohesion: As per Thake and Zadek (1997), social
entrepreneurs promote social cohesion in the welfare state. As Leadbeater
(1997) claimed, the current welfare state is unable to solve many of the
social problems it must solve because of its lack of flexibility, bureaucracy,
and slowness. To overcome exclusion and to provide benefits
simultaneously, society urgently needs social progress, and social progress is
what social enterprises support. In other words, social entrepreneurs are
creating a new way of providing benefits so that society can unite to a certain
extent.

ii) Building Social Capital:- Social entrepreneurs create several tangible


assets, including new services and employment opportunities, social capital,
however, is seen as the most important form of capital they create
(Leadbeater, 1997). 'Social capital is the network of relationships that
underpins economic partnerships and alliances', Leadbeater said, 'these
networks depend upon a culture of cooperation, fostered by shared values
and trust'. As they transfer value and trust, socially entrepreneurial
organizations appear to be most effective in this area. They intend to find
ways to promote the relationship between welfare and humans, establish
long-term cooperation between poverty and affluence, and address real social
problems.

1.4 Definitions by various Authors

Author Year Definition ( Social Entrepreneur)

Bornstein, D. 2004 A path breaker with a powerful new idea, who


combines visionary and real-world problem
solving creativity, who has a strong ethical fibre,
and who is 'totally possessed' by his or her vision
for change

7
Dees, J. G. 1998 Social entrepreneurs play the role of change
agents in the social sector, by: Adopting a
mission to create and sustain social value (not
just private value); Recognizing and relentlessly
pursuing new opportunities to serve that mission;
Engaging in a process of continuous innovation,
adaptation, and learning Acting boldly without
being limited by resources currently in hand;
Exhibiting heightened accountability to the
constituencies served and for the outcomes
created.

Ashoka 2020 Social entrepreneurs are individuals with


innovative solutions to society's most pressing
social, cultural, and environmental challenges.
Social entrepreneurs are ambitious and persistent
— tackling major issues and offering new ideas
for systems-level change. They model
changemaking behavior, and catalyze
organizations and movements where everyone
can be a changemaker.

Author Year Definition (Social Entrepreneurship)

Austin, J., 2006 Social entrepreneurship is an innovative, social


Stephenson, H., & value-creating activity that can occur within or
Wei-Skillern, J. across the non-profit, businesses or government
sectors.

8
Mair, J. & Marti, I. 2006 Social entrepreneurship: Innovative models of
providing products and services that cater to
basic needs (rights) that remain unsatisfied by
political or economic institutions.

Nichols, A. 2006 Social entrepreneurship entails innovations


designed to explicitly improve societal well
being, housed within entrepreneurial
organizations which initiate, guide or contribute
to change in society.

Author Year Definition (Society)

MacIver, R., M. & 1965 Society is a system of usages and procedures, of


Page, C., H. authority and mutual aid, of many groupings and
divisions, of controls of human behaviour and of
liberties. This ever-changing, complex system
we call society. It is the web of social
relationships. And it is always changing

Maryanski, A. & 1992 Society is the whole complex of social behavior


Turner, J., H. and the network of social relationships.

Lenski, G., Nolan, 1995 An organized voluntary association of people for


P. & Lenski, J. religious, benevolent, cultural, scientific,
political, patriotic or other purposes.

Author Year Definition (Social Value)

Guclu, A. J., Dees, 2002 The commitment to addressing ―a particular


G., & Anderson, B. social need must be shared by enough key
B. stakeholders to give the proposed venture some
initial viability.

9
Certo, S. T., & 2008 The fulfillment of basic and long-standing needs
Miller, T. such as providing food, water, shelter, education,
and medical services to those members of
society who are in need.

Phills, J.A., 2008 The creation of benefits or reductions of costs for


Deiglmeier, K., & society—through efforts to address societal
Miller, D.T. needs and problems—in ways that go beyond the
private gains and general benefits of market
activity.

1.5 Operational definitions

For the purpose of this study, the operational definitions of the various terms used
are as follows:

Social Entrepreneurs: Social Entrepreneurs are those change agents who improve
societal well-being through innovative-value-adding activities that can occur within
or across non-profit, business or government sectors.

Social Value: Social Value means that which improves the quality of life of the
masses.

Society: Society is the whole complex of social behavior and the network of social
relationships.

1.6 Statement of the Problem:

Social entrepreneurs are visionaries who try to solve social problems that are wide
and varied in nature and by applying their social entrepreneurs' ideas and strategies,
thereby bringing positive changes to society (Shethna, 2020). Many social
entrepreneurship studies have focused on a unified definition of the concept (e.g.,
Dacin et al., 2010; Mair & Marti, 2006; Nicholls, 2010). Other researchers have
differentiated between social entrepreneurship and commercial or business
entrepreneurship (e.g., Austin et al., 2006; Dees, 1998; Shaw & Carter, 2007). While

10
social value creation has been identified as central to social entrepreneurship (Austin
et al., 2006; Dees, 1998; Drayton, 2006; Tracey & Phillips, 2007), researchers are
yet to fully explore social value creation from the social entrepreneur's perspective.
According to Guclu et al. (2002), no empirical research exists on how social
entrepreneurs create social value. The research problem was that the research on the
creation of social value is limited, especially from the perspective of social
entrepreneurs in India. The present study focused on the creation of social value,
especially from the perspective of social entrepreneurs in India and their
contribution to Indian society through social value creation.

Scholarly work in the field of social entrepreneurship is currently missing studies


that can test the scope and generalizability of theoretical propositions, discover
antecedents and consequences of social entrepreneurial activity (Lepoutre et al.,
2011). This study also examined the scope and universality of existing theoretical
frameworks and provided further information on the essential dimensions related to
social entrepreneurs for the creation of social value.

The research focuses on understanding the contribution of social entrepreneurs to


help solve the problems and issues of society. The analysis of study data will look to
identify contributions, facilitating factors, key themes and ideas that may be
prevalent within individual entrepreneurs and the subjects participating in the study.
Listening to the entrepreneur's experience may provide a depth of understanding and
insights not previously realized and help compile a more holistic look at what an
entrepreneur really is and what triggers them to become a social entrepreneur and
identify contributing factors to effective entrepreneurial pursuits.

1.7 Research Questions

The research questions addressed through this study are as follows.

1. What are the contributions of Indian social entrepreneurs to the society they
live in through social value creation?

2. What are the facilitating factors to become a social entrepreneur in the Indian
context?

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1.8 Objectives of the Study

General Objective:

To conduct a comprehensive study about Social Entrepreneurs, the stimulating


factors to become a Social Entrepreneur, the elements working with the
supportability of their endeavour and the impact they make in the lives of their
beneficiaries.

Specific Objectives

 To explore how the social entrepreneurs in India create social values.

 To explore what social values are created by the social entrepreneurs in


India.

 To identify various facilitating factors involved in becoming a social


entrepreneur.

 To study the impact created by the social entrepreneurs in the society they
live in.

1.9 Significance of Social Entrepreneurs

Howorth et al. (2012) focused on social entrepreneurs as their unit of analysis for
social entrepreneurship because social entrepreneurs generate promising ideas that
develop into attractive opportunities. According to Drayton (2006), as social
entrepreneurs increase numerically globally, and the topographical range of their
ideas grows, so do the number of support institutions funding and partnering with
these entrepreneurs; the whole process is enormously contagious. Social
entrepreneurs work intending to change the face of society. They operate in areas
such as health, hygiene, education or other areas that require growth. Social
entrepreneurs strive to improve systems, find new solutions and establish fair
practices. It is important to support social entrepreneurship and encourage those with

12
ideas to innovate. People with a creative mind or a desire to provide services for the
greater good without being manipulated or deceived will change the way we live.

Authors Noruzi and Westover (2011), social entrepreneurship is more and more
connected with everyday life and practices; it is clear that social entrepreneurship
and social entrepreneurs are becoming more inclusive and can be observed in less
obvious contexts than people normally expect. However, according to these authors,
this penetration is different from the increasingly homogenized criticism of
entrepreneurial identity as it is assumed to be entrepreneurship because it
significantly changes lifestyles, constantly questioning and changing the
organization of life.

Ultimately, when entrepreneurs shape the future of society, and when the task of
entrepreneurs is to transform the society that people must live into the society that
people want to live in, entrepreneurship brings diversity and creativity into social
organizations (Steyaert, 2007).

1.10 Assumptions and Limitations

Assumptions:

The researcher made the following assumptions associated with this study:

1. The conceptual and theoretical model is appropriate for the study.


2. The participants' responses are accurate and truthful concerning the topic.
3. The interview guide, process, duration, and results are appropriate for the
study and collection of data.
4. The methods selected are suitable for data collection and analysis for the
topic.

Limitations:

The study was an attempt to gain a perspective on the selective social entrepreneurs
of India and their contribution to society through social value creation. The present
study was undertaken after carefully considering the models and the designs for

13
analysis. It was hoped that the model selected as appropriate. It was also felt that a
quantitative analysis of the data would lead to accretion to the findings.

No research is perfect, and even this research work has certain limitations which
pave a path for further study. Although much strength is associated with the
research, its limitations are noted as follows:

1. The study covered 12 states and one Union Territory (UT) of India. More
social entrepreneurs from other states/UTs could have been included.

2. The study was limited to 50 samples, comprising of 25 primary data and 25


secondary data. However, to come to a general concrete conclusion and
increase the generalization quality of research, further research on a larger
sample can be carried out, giving a deeper understanding of the social
entrepreneurship phenomenon.

3. The primary data study was only from the social entrepreneur's perspective
and did not include the beneficiaries' or stakeholders' perspective.

1.11 Significance of the Study

There is no time like the present. India finds itself in a situation with multiple
challenges. The nation is ageing; there is a high incidence of immigration and
shifting ethnicity within the country. India continues its transition from a
manufacturing-based economy to a knowledge- and information-based economy.
There are ongoing environmental concerns, and terrorism continues to be a threat.
Identifying solutions to these and the many other issues facing the country will
require creative thought and action, and in many cases, the ability to think
entrepreneurially. This is no surprise because the current administration sees the role
of social entrepreneurship as key to building a secure and fruitful future and has
policy initiatives in place to facilitate this.

This study helps to understand different Indian social entrepreneurs and their
contributions to society. It is hoped that this exploration, the examination of the
lived experiences of social entrepreneurs, will bring a deeper understanding of what
is already known about them, ultimately helping to facilitate and encourage more

14
social entrepreneurial vision and successful application. With the emphasis on social
entrepreneurial activities in communities and in organizations, a deeper
understanding of social entrepreneurs can go a long way towards encouraging more
social entrepreneurial activities in all areas and walks of life.

The study findings may be useful to many different audiences, including nascent
social entrepreneurs, potential and existing social entrepreneurs, those oriented to be
social entrepreneurs, programs, and curricula that support and encourage social
entrepreneurs, and those in a leadership role regarding social entrepreneurial and
policy actions.

1. Potential social entrepreneurs will benefit from a deep understanding of the


experiences of the social entrepreneur because this knowledge can help them
see and assess their fit as social entrepreneurs as well as strengths and
shortcomings. This may help them to make more effective decisions
regarding their role as a social entrepreneur.

2. Existing social entrepreneurs can use this deep understanding as a real-time


comparison and contrast, providing significant input to understand their
social entrepreneurial behaviour and perception better.

3. Leadership that encourages social entrepreneurship and creates policy can


benefit by obtaining a deeper understanding of the entrepreneur, therefore
aiding the development of more effective policies and activities that better
embrace the true needs and talents of the social entrepreneur.

Overall, exploring social entrepreneurs and their contribution to society through


social value creation experiences, including the facilitating factors that motivate
them to become social entrepreneurs, will bring greater depth to social
entrepreneur's understanding, approach, thinking, and understanding of social values
created by them. This insight can benefit social entrepreneurs or those having social
entrepreneurial intentions and those who volunteer and interns working with social
entrepreneurs. Additionally, it can help craft policies regarding social
entrepreneurial activities at all levels and across all situations.

15
1.12 The Scheme of Chapterization

The chapter scheme of this study consists of six chapters. Chapter 1 provides the
background of the study, operational definitions of the terms, statement of the
problem, objectives, research questions, significance of the study and of the social
entrepreneurs, as well as assumptions and limitations of the study.

Chapter 2 provides the evolution and developments in the field of social


entrepreneurship. It also provides a literature review and evaluates relevant literature
and prior research on social entrepreneurship. It also includes literature that
informed the theoretical framework used in the selection of the "social value"
construct as well as notifies about the research gap.

Data concerning the research methodology and design used in the study are
discussed in Chapter 3. Justification for the sample selection, instruments used, data
collection and analysis methods are also provided. Moreover, the reliability and
validity of the research are also discussed.

Chapter 4 provides details of the analysis of the research findings. The chapter
starts with the demographic analysis and eventually addresses research questions. It
also includes a detailed description of the themes that emerged from the data
analysis.

Chapter 5 presents the findings of primary data regarding seven dimensions


essential for social value creation collected from the existing theoretical frameworks
and provided further information on these essential dimensions related to social
entrepreneurs. Further, it gives a detailed narrative of the impact created by one
distinctive social entrepreneur in the life of their beneficiaries.

Chapter 6 provides a discussion of the study's results and the contribution of this
research to the limited existing literature on social value creation. The study also
proposed a 'Social Value Pyramid' and a conceptual model for the contribution of
social entrepreneurs to society through social value creation. The research also tried
to redefine social entrepreneurs. Finally, it includes recommendations for future
research.

16
1.13 References:

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Bheemappa, M. (2015). Entrepreneurship is the core force of economic growth – A


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Austin, J. E., Stevenson, H., & Wei‐Skillern, J. (2006). Social and commercial
entrepreneurship: Same, different, or both? Entrepreneurship Theory and
Practice, 30(1), 1–22.

Kannampuzha, M., & Hockerts, K. (2019). Organizational social entrepreneurship:


Scale development and validation. Social Enterprise Journal, 15(3), 290-
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Rey-Martí, A., Ribeiro-Soriano, D., & Palacios-Marqués, D. (2016). A bibliometric


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Huda, M., Qodriah, S. L., Rismayadi, B., Hananto, A., Kardiyati, E. N., Ruskam, A.,
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