CHAPTER 14

Strategy and Social Value

THREE TYPES OF VALUE

• Economic Value—increases in income, wealth, or profit

• Social Value—Increases in well-being in non-economic areas– Literacy– Health and sickness– Housing

• Shared value--when creating economic value also creates social value

SUSTAINABLE STAKEHOLDER ADVANTAGES

• Social value organizations rely on repeat transactions– Universities and legacies– Community agencies and ongoing partners

• The ability to consistently gather resources from key stakeholders such as donors, volunteers, students, etc.

THE VALUE NET

Customer

OrganizationCompetitor Complementor

Supplier

CSR: A FIRM’S SOCIAL OBLIGATIONS

Philanthropic Responsibilities

Ethical Responsibilities

Legal Responsibilities

Economic Responsibilities

TYPES OF SOCIAL ENTREPRENEURSHIP

Focus on SE Activities

Role of social entrepreneur/ leader

Examples

Capacity Building Social bricoleur: Combines existing resources to focus value creation

Highlander Research and Education Center (USA): adult education for community problem solving in Appalachia

BRAC (Bangladesh): organizes and trains poor communities to create economic and social development

Products/ Services Social constructor: Develops new models, products, or services

Grameen Bank (Bangladesh, Worldwide): developed unique model for delivery/ repayment of micro-credit

Unilever (India): Project Shakti uses rural women to sell hygiene products. Improves local health and incomes

Institutional Change Social engineers: agitate for change, design more effective social systems

Bono (Ireland): becomes a voice for worldwide poverty alleviation

Nelson Mandela (South Africa): reconciliation commissions allow wounds from apartheid to heal

SUMMARY

• Strategy matters for social value organizations

• Pressure for socially responsible behavior will continue to increase as you enter the workforce

• Social entrepreneurship represents a new way to make a difference in the world