Developing Social Business Initiatives Within Industrial Firms

Innovation Statement

Through a university-business collaboration, socially motivated business students participate in a project-centered course with traditional industrial firms to help them develop sustainable social business models within the firms’ core competencies. 

Call to Action

Through university-business collaboration, new models for the development and implementation of social business models are being developed. Intractable social problems such as poverty, exclusion, and environmental degradation call for cross-sector and multiple-bottom-line innovations.

Traditionally, most solutions are developed by nonprofit organizations in the form of social enterprises, with limited solvency and impact since they fail to scale up, often remaining operational only through philanthropic assistance. The real potential for social impact, coupled with financial endurance and managerial capacity, lies in the business sector.

Thus, innovative business models based on blended value propositions have emerged recently, including social investing, social business, bottom-of-the-pyramid business models, Benefit Corporations (or B-Corps), and more. Such models seek to generate social impact in multiple ways, such as designing human-centered businesses and products, developing products for health benefit or to benefit low-income customers, and creating employment for excluded communities and individuals. The models operate through a variety of revenue types, in diverse industries and markets. Albeit, despite their double bottom-line advantage, the application of such business models remains sparse.

Barriers include limited familiarity with the different models, incompatible preexisting business mindsets, and antiquated approaches to corporate social and environmental responsibility. Among ways to overcome these barriers are university-industry collaborations, which are known to drive creativity, particularly through service learning courses within business organizations.

Description

The project-centered course in the Department of Management at the Guilford Glazer Faculty of Business and Management at Ben-Gurion University of the Negev (BGU) includes a unique cooperation between the faculty, a major employment development NGO (JDC-Israel-Tevet), and an innovative social enterprise training lab at BGU (Rothschild Cube).

The course’s aims are twofold: first, to familiarize students with the phenomenon of social business and hybrid organizations’ business models, and second, to develop together with the firms a working model for the establishment and management of sustainable social business within the core competencies of existing industrial firms.

The working model of the course is forming teams of students, guided by trained social-business coaches, who engage with industrial firms in the region, to develop social businesses at the firms’ core business. The engagement starts with an exploration stage, in which the students liaise with the firm to learn about its products, practices, markets, and customers and conduct desk, field, and market research to learn about blended value products and business innovations relevant to the firm. The team then develops a set of ideas and a business plan for the idea chosen by the firm. Implementation of the business plan is next pursued by the firm with JDC-Israel-Tevet support.

Impact

The project will be applied in full for the first time in the 2016–17 school year. A pilot of the project was implemented in 2015, which has resulted in several new business initiatives. An example is a current business collaboration between a major producer of MRI machines and an HMO, developed through the project, which takes advantage of the required run-up period of the machines before delivery to buyers, to make waiting lists for MRI scans shorter. A first run of the project in the current format and has generated three new business plans.

Anticipated Future Impacts