3 Key Globalization Trends that Drive Social Enterprise

It is simply unquestionable by now the significance of internet technology for current wave of social enterprise movement. It is widely known that there are tremendous benefits to utilize social media tools in terms of cross collaboration and partnership, fund raising and generating commercial values. But that is only one particular driver of globalization for social enterprise to leverage on.

The key driver of globalization has always been free market system that also leads to the emergence of for-profit social enterprise. I think there are 3 fundamental aspects that underpin free market system should be well understood, continuously enhanced and adapted in pursuit of social goals.

Market-based Innovation
There has been a lot of hype about social innovation lately, but there is a tremendous risk to directly replicate free market approaches to address poverty irrespective of the unique circumstances in poorer regions. It is well understood that there is no one-size-fits-all approach and current trends already show social entrepreneurs have been sensibly altering the general prescription advocated by free market ideologists. There will be a lot more experimentation to come, like the myriad micro-financing schemes, social capitals and employment-based solutions are just some of the common types of social innovation currently. The future points to the direction of adaptation and gradual innovation from free market approaches rather than a completely disruptive breakthrough.

Capital Investment
I do not know if it is ever possible that we will have a major mainstream social capital market that runs in parallel with private capital market. I think a closer reality is that successful social enterprise after start-up stage will eventually compete with private enterprise for private capital. But this trend is still at a distant future to happen on a large-scale basis. There is no question about the need to track current social capital investment trends and study the basic criteria of what socially conscious investors are looking for. I think the bonus of studying social capital investment trends closely is the likely emergence of a general pattern and critical insight in measuring social enterprise performance with key metrics along financial and social dimensions. It is unsurprising if social entrepreneurs continue to struggle to define metrics and to attract investment if they are solely preoccupied with social impact achieved with the poor without balancing it with what investors are looking for. They are part of the key stakeholders who expect social enterprise to be run like business enterprise.

Outsourcing and Offshoring
Corporations will continue to search for qualified and competent talents at a lower cost in developing regions, that means the benefits outsourcing and offshoring rarely trickle down to unskilled and poor labor. It presents a unique opportunity to social entrepreneurs to keep track of outsourcing and offshoring trends, train and match poor labor to perform the required tasks. If it is possible to leverage on the unique existing skills of poor labor then it will eliminate the need of greater resources for new training. I imagine cluster pools of labor with similar skills to be formed in villages ready to facilitate and take on jobs offered by corporations.