In 1985, British athlete and entrepreneur Trevor Baylis, corporate finance expert Christopher Stainer, and South African entrepreneur Rory Stear teamed up to launch BayGen Product PTY – a low-tech, low-cost wind-up radio product created and produced by a company in Cape Town, South Africa. The social goal behind this enterprise was as follows:
Deliver an affordable and dependable communication device – a wind-up radio not reliant on electricity or expensive batteries – to millions of people living in rural and remote areas of the developing world to address the problem of information isolation. The radios will raise the standard of living for these people by making information accessible on issues such as the causes and prevention of diseases, sanitation, agricultural best practices, weather warnings and disaster relief.
The results were incredible. In the first five years the company sold eight million wind-up radios for $40 each. The company has since diversified into alternative energy solutions and hardware/software solutions for rural radio services. Most importantly, the company’s products and programs have had a marked impact on the lives of many people – neighbours, friends and families in some of the world’s most rural and remote communities.
At the core of social entrepreneurship is the idea of blended value creation – defined as when an organization adopts traditional entrepreneurship and management tools in order to create both economic value (wealth) and social value (sustainable social change). Therefore, genuine social enterprises go even further than corporate social responsibility practices by intentionally designing hybrid business models that combine two essential components: means of generating earned revenue streams that would sustain the venture financially beyond donations and philanthropic support, and a well-articulated road map of how social change will be achieved. As Robert Solomon notes, “Business serves people and not the other way around. It is value and virtue that make business life rewarding and meaningful.” (xiii)
Value creation in the business world has traditionally been defined as increasing the wealth of shareholders – solely an economic focus. However, the emergence of social entrepreneurship has broadened our understanding of what capitalism and business are all about to include social and environmental objectives as part of the value spectrum, that is, the pursuit of blended value creation. In the wake of the 2008 worldwide financial crisis, interest in exploring organizational forms that pursue this blended value has risen dramatically. Examples of social enterprises or blended-value organizations range from the profit-driven company that does business in responsible and sustainable ways while giving some of its profits to community initiatives, to the not-for-profit organization that directs all revenues toward social causes.
Ambrose is educating the next generation of leaders by focusing on the four C’s of social entrepreneurship: compassion, creativity, courage and competence.
Compassion is at the heart of social enterprise. The wind-up radio business in South Africa was not triggered by a profit-seeking motive (although breaking even is necessary for a social enterprise to be sustainable), but with the compassion Trevor Baylis felt after viewing a documentary on the challenges of rural life in Africa. Compassion is not the same as empathy – a mirroring of another person’s emotions, whether sorrow or joy. Nor is it the same as sympathy – a feeling of sorrow associated with the suffering or need of another. While compassion does require the ability to empathize and to sympathize, it also includes the need or desire to relieve suffering. This is why compassion is an essential requirement for any pro-social action, including blended value creation, and why Ambrose Business looks to understand compassion as a basic and enduring human value to be nurtured among our business students – the future leaders in the marketplace.
Entrepreneurial success in general, and success in social entrepreneurship in particular, depends greatly on the ability to create and innovate. Although appearing basic and low-tech, there was a surprising amount of innovation that went into developing and deploying Baylis’ wind-up radio product in the marketplace. A creative attitude supports innovation, (social) entrepreneurship and everything else - imagination, originality, invention, discovery, adaptability and flexibility. This creative mindset cannot be learned in one day or even in a weekend training session. It is, instead, cultivated over time as individuals continuously reflect upon and assess their own originality, inventiveness and imagination, much like artists. Creativity emerges as learners develop a curiosity and appreciation for a variety of topics and experiences, many of which are outside the business context. Learning to explore a wide range of ideas, make connections across events that are sometimes unrelated, understand unexpected results and re-frame issues helps to shape a person’s creative abilities.
The courage to take risks is another key ingredient for social entrepreneurship. Entrepreneurs are driven by a passion for change and frequently take leaps of faith by jumping into action before the necessary resources are secured. Before the risks paid off, Baylis courageously spent several years of his life and personal fortune developing a working prototype of his wind-up radio and presenting the product to prospective funders. Yet the risks associated with making social change through social entrepreneurship can often stir up feelings of anxiousness, fear and confusion. The greedy excesses revealed by the 2008 financial meltdown have made many people reluctant to take risks today. However, as The Economist magazine (64) recently noted, unless we educate students in a way that encourages them to take the sorts of risks, for the right reasons, that will “help propel the economy for decades to come, [we]...may soon be worrying about the lack of risk-takers, not fretting about their excesses.”
Finally, aspiring social entrepreneurs develop competence as their awareness of and belief in what they are capable of doing expands. We need to develop a competence in our students that includes knowledge and expertise, as well as the skills to consistently turn knowledge into actions. An entrepreneur’s ability to judge and make decisions in the midst of uncertainty is one of the soft (non-technical) skills or competencies that make up entrepreneurial action. Competence is best achieved through learning opportunities that allow students to learn through observation, trial and error and feedback. This is why Ambrose Business emphasizes a service-learning, project-based approach to learning that will include experience gained in a forthcoming business incubator course, as well as an international entrepreneurship travel study.
Social entrepreneurship has much in common with the Christian world-view. As Christians, we have the example of Christ’s compassion to guide us as we seek to bring His love to a lost and wounded world. We serve a creative God who has imparted aspects of His creativity into His people. We must also remember that whenever Christ saw his followers feeling anxious, fearful, or confused He reminded them of His promise that He will not abandon us – He gives the courage we need to walk by faith when He calls us to take risks. And, we can competently serve Him as we use the talents and gifts He has given us to bring glory to His name. We look forward to seeing Ambrose Business graduates – compassionate, creative, courageous, and competent business leaders – making a positive social impact through social entrepreneurship.
David Iremadze is a professor in the Business Administration program at Ambrose. His research interests include entrepreneurship and history of management thought.
Works cited: Solomon, Robert C. A Better Way to Think about Business. Oxford, UK: Oxford University Press, 1999.
