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Evaluating the success factors for establishing a thriving social enterprise in Scotland

Evaluating the success factors for establishing a thriving social enterprise in Scotland

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Evaluating the success factors for establishing a thriving social enterprise in Scotland

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  1. Evaluating the success factors for establishing a thriving social enterprise in Scotland Scottish Third Sector Research Conference Jonathan Coburn Director, Think! Research for Social Change

  2. Format • The rationale for the research • About the study • Identifying the factors that underpin success • The importance of resilience and adaptability • Examining the influence of the economic downturn • The case of ethnic minority social enterprises • Policy contribution of the research

  3. Rationale for the research • Research commissioned in late 2009 in a context of substantial investment in social enterprise • At the cusp of a time of transition and change – entering the age of austerity • Issue of targeting/prioritisation of Government support to social enterprise … identifying and rewarding success rather than failure • The understanding gained was to be used to critically assess the Enterprising Third Sector Action Plan (2008-2011) and post 2011 support

  4. Research Objectives • Overall aim to identify success factors • How these are defined by social enterprises? • Are they different in a time of recession? • What enables success? • What are challenges for ethnic minority social enterprise? • Emphasis on allowing social enterprises to define success and success factors in their own terms • Focus on gaining an in-depth understanding of the issues facing a diverse sample of social enterprises

  5. Study method • A literature review • Interviews with 28 key informants • Scoping interviews with 25 social enterprises • Case study research in the story of 11 ‘successful’ social enterprises • Desk-based research • Organisational ‘life history’ interviews with the leaders • 106 follow-up interviews across the cases • In-depth interviews with 5 ethnic minority led social enterprises

  6. Eleven different stories of ‘success’ • Skye Ferry CIC • Kibble Education and Care Centre • Pollok Credit Union • Impact Arts • The North Harris Trust • ACE Recycling • The Claverhouse Group • Dial a Community Bus Buchan • Out of the Blue • Aberdeen Foyer • The Breadmaker

  7. Critical success factors

  8. The essence of success • Success is usually relative and case-specific • You can’t compare apples with oranges or pears • What constitutes ‘success’ varies over time and can be fleeting • ‘Success’ is usually in the eye of the beholder • Success comes down to achieving a balance between • Social objectives – delivering on your core social purpose • Financial objectives – the business of staying in business • … also the ‘right’ balance of internal traits or critical success factors • This balance changes over time, as the social enterprise develops and its environment changes

  9. The typical path to ‘success’

  10. Resilience and adaptability • A steep learning curve; initially and throughout life • Many ‘make or break’ moments along the way e.g. • when the rules of the game change • when growing pains arise and infrastructure creaks • when founders and leaders withdraw • Resilience and adaptability can depend on … • Stabilising operations • Taking personal responsibility • Listening to the right advice • Refocusing on the earned income strategy • Staying true to the social mission • During good and bad times, socially entrepreneurial leadership is key – passion, charisma, self-reliance, risk-taking, etc.

  11. Understanding the main external influences

  12. Influence of the economic downturn • Uneven and unpredictable results • Depends on the market rather than the organisation • Buoyancy and optimism coming through from the research • Must separate out the short-term from the longer-term effects • Some tactics to weather the initial storm • Spotting and managing the risks • Drawing on the right support and advice • Stripping out unnecessary costs • Maintaining tight cash control • Remaining responsive to changing customer needs • Longer-term • Fundamental shockwaves through public sector finances • Successful social enterprises have a clear strategic focus and remain in control of the critical aspects of their business

  13. The case of ethnic minority social enterprises

  14. Some policy recommendations... • Focus onpeople as well as organisations • Ensure a ‘pipeline’ of business support • Use all of the public sector levers of influence • Embrace the potential for failure as well as success • Help to avoid the avoidable mistakes • Offer support during difficult economic conditions • Encourage social innovation and change • Ensure social enterprise is an option for all

  15. Informing policy? • Continuing commitment to value and support a capable, sustainable social enterprise sector • Work underway to build on the Enterprising Third Sector Action Plan (2008-2011) • Ongoing themes: • Business support • Opening public sector markets • Funding and investment • Approach (2011-14) to delivering support through overarching outcomes-focussed contracts • Are these focused on fostering and rewarding success, not failure? … time will tell

  16. Thank you! w: t: 0141 352 7419 e: