Social Innovation vs Social Enterpise (With Examples)

Social Innovation and Social Enterprise are on the rise. Businesses are becoming concerned with solving social problems rather than simply making a profit. This is great news, but for those of us trying to sift through the jargon, it is helpful to define these terms.

I’ve already discussed the definition of open innovation but this differs from the definition of social enterprise or social entrepreneurship. While social innovation could mean doing things differently on a variety of different levels, social entrepreneurship focuses specifically on business.

Who is a Social Entrepreneur?

Most businesses are created because someone saw a need that was not being filled. The same is true of the social entrepreneur, however instead of a need that is not being filled this person usually sees an injustice or inequality in society that needs to be solved. Instead of asking for donations, lobbying the government, or building a community group, the social entrepreneur decides to start a business to tackle the problem. And so a social enterprise is born. While one typically thinks of a social enterprise as a for-profit organisation, some social enterprises run on a not-for-profit model.

Here are some examples of social enterprises:

Solar Sister- Creating job opportunities for women in Sub-Saharan Africa while promoting clean cooking technology.

San Patrignano- A free rehab centre in Italy which generates income through a variety of creative community projects.

Food Cycle UK - Reducing food waste and food poverty at the same time.

Sole Rebels- Ethiopian based shoe company which provides real jobs for locals- paying 4x the minimum wage, health insurance, and opportunities for disabled workers.

Divine Chocolate- What’s that you say? Guilt free chocolate!? A fair trade chocolate company which is 45% owned by the farmers themselves.

DlightDesign- Selling solar lights to communities that don’t have reliable electricity.

What is the Difference Between a Social Entrepreneur and a Social Innovator?

While a social entrepreneur is focused on solving a problem through business, a social innovator could be looking to solve the problem through a number of different mediums. A social innovator may be an employee in a company, part of a government organisation, or a participant in a hack-a-thon. Further, social innovators tend to use the structure of open innovation. A field which we love (duh!) and a field in which a lot of research and methodology is booming.

Social entrepreneurs follow the rules of start-ups which can sometimes be messy and lack the proper tools for citizen engagement, follow up, and measuring success. Yet, as seen from the examples above, social entrepreneurs are growing social enterprises that are having a positive outcome in the community.

The Stanford Social Innovation Review (SSIR) published an article back in the fall of 2008 supporting the importance of social innovation over social enterprise. However, since that time we have seen social enterprises growing and solving real problems in the community. The SSIR promotes social innovation due to the methodology as well as it’s abilities to cross the borders of business, government, and non-profit. While I would love to see more boundaries broken between these sectors, I think supporting all types of social improvement, whether it be through open innovation or through business, is important. Change makers can pop up in all sorts of environments, and we should never be afraid to give them the tools and resources to make the world a better place.

Oh, and if you’re looking for examples of social innovation; check out these 41 inspiring examples.