Social entrepreneurs want to help solve social and environmental issues by applying entrepreneurial solutions. However, social entrepreneurs usually find it more challenging to measure their success because of the metric that is being measured is not only for financial gain but also for social and environmental change. The analysis of how they manage and achieve their impact goals, which are restricted by limited knowledge and resources, is unfortunately not always the highest priority particularly in the early stage of their entrepreneurial journey.
Frequently, by generating social and economic value, business decisions and actions are in opposition (Dawan & Alter, 2009). This opposition translates into calculated trade-offs. At times decisions may be adequate that forsake social impact in order to gain market share or increase profit margins and increase social value creation in the long run. Conversely, the scope of social impact may be expanded at a financial cost (Braun, 2020).
What also often happens in our experience is that more social businesses claim their impact without clear justification based on measurement. And even worse is that many social entrepreneurs are not equipped with the right mindset and tools to understand how to measure, manage and maximise their impact.
Also, the situation with COVID-19 pandemic makes it even more pressing now that businesses must be held accountable for their actions; decisions solely relying on financial gain are even less relevant during this time. The pandemic will likely create even more inequality, with evidence emerging that those at the bottom of pyramid are being more severely affected. Casualties will be even more with the virus spreading faster on the bottom-of-the-pyramid communities, and we have seen that hospitals and proper medical care are being allocated improperly with several privilege for some people with more resources. The implication of these inequalities will have a profound impact on every level and aspect of communities.
Here in this chapter, we will discuss the challenges through our experiences in practicing impact management and why it's very important to be done at all levels of the entrepreneurial stage even from the upstart and what can be done better to help social and all entrepreneurs to strive.
Hendradjaja, W. and Leoma, M. (2021), "The Path to a (Faster) Systemic Change", Richards, A. and Nicholls, J. (Ed.) Generation Impact, Emerald Publishing Limited, Bingley, pp. 63-72. https://doi.org/10.1108/978-1-78973-929-920200006
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