International Journal of Entrepreneurship (Print ISSN: 1099-9264; Online ISSN: 1939-4675)

Research Article: 2022 Vol: 26 Issue: 1S

Social entrepreneurship and covid-19: managing the crisis

Mir Shahid Satar, Saudi Electronic University

Ghadah Alarifi, Princess Nourah bint Abdulrahman University

Citation Information: Satar M.S., & Alarifi G. (2022). Social entrepreneurship and covid-19: managing the crisis. International Journal of Entrepreneurship, 26(S1), 1-11.

Abstract

COVID-19 resulted in a formidable health pandemic that not only led to a massive health crisis but also altered the current social, cultural, and economic systems across the globe. Nevertheless, while the crisis posed massive challenges with unprecedented social norms, it simultaneously unrevealed lessons for more entrepreneurial approaches entailing social innovations. The social innovations through S-ENT have assumed the potential to curtail such situations and create more positive social values. This article aims to understand how social entrepreneurship (S-ENT) as a tool for social innovation can be leveraged for problem-solving in crises like Covid-19. We review the appropriate aspects of the S-ENT phenomenon to illustrate their relevance in the crisis management context. The article identifies the main social entrepreneurial aspects of collaborative social value creation, social enterprise business models, networking as well value creation through digital collaboration as strategically suited to cope with the crisis emerging from COVID-19 or other such catastrophes. The article thus attempts to respond to the ongoing need for innovative approaches for crisis management while simultaneously illuminating the frontiers of the S-ENT phenomenon. This has scope for deriving the research prepositions for future research exploration. Therefore, the article is intended to aid the management, business, and entrepreneurship scholars and practitioners as well as the other stakeholders of the S-ENT ecosystem to stimulate the value-driven crisis management approaches that essentially integrate the S-ENT perspective.

Introduction

The novel Coronavirus disease 2019 resulted in a formidable outbreak that spread rapidly across the globe. The disease was later declared as pandemic and subsequently named COVID
19 (Coronavirus Disease 2019) by World Health Organization in February 2020. The COVID 19 crisis emerged swiftly and disrupted the social, economic, and health systems across the globe (Parnell et al., 2020). The social effects emerged mainly from the new norms of how individuals interact and behave in society, the physical and social distancing as well as changes in the working conditions (Alon et al., 2020; Kraus et al., 2020). This has resulted in many cultural changes as well as impacted the general psychological health and wellbeing of people across the globe. Meanwhile, businesses and industries are facing varied challenges with small businesses facing threats to survival (Kraus et al., 2020). Much of the economic effects are still unknown with the prevailing supposition that the COVID 19 crisis will lead to economic recession in the global economy. The countries across the globe have come with varied interventions to deal with such unprecedented social challenges.

Generally, a logical and rational approach to a crisis is considered appropriate (Liu et al., 2017). However, such an approach is found as inappropriate for crises that develop so quickly with accompanied enormous uncertainty. Therefore, for crises that are characterized by their dynamic nature and uncertainty, a direct yet rapid approach is needed (Weick & Sutcliffe, 2011). Unlike other crises, COVID 19 is considered an on going condition with an indefinite period (He & Harris, 2020). Thus, social challenges like COVID 19, warrant novel responses that adopt innovative, impact oriented, and more unorthodox approaches to mitigate the crisis. Therefore, it is argued by recent research that decision makers need to think out of the box for plausible solutions to crises. In this direction, the research has started evolving that contemplates the entrepreneurial approaches as appropriate strategy to deal with the COVID 19 crisis. Accordingly, considering the COVID 19 shifts in the way things are currently done, entrepreneurs are suggested to share and analyze the current business environment to anticipate change and adapt rapidly to focus on new trends (Ratten, 2020).

Although, COVID 19 is still evolving uncertainly (World Health Organization, 2020), there lies much uncertainty about how it will impact entrepreneurship and how entrepreneurship can cater to such crisis more effectively. Nevertheless, while the crisis posed massive challenges with unprecedented social norms, it simultaneously unrevealed lessons for more entrepreneurial approaches entailing social innovations. Such learning’s have implications for managing crises requiring social changes. The social innovations through social entrepreneurship (S ENT) 1 have assumed the potential to curtail such situations and create more positive social values (Bacq & Lumpkin, 2021).

This article aims to understand how social entrepreneurship (S ENT) as a tool for social innovation can be leveraged for problem solving in crises like Covid 19. We review the appropriate areas from the S ENT phenomenon to link them with crisis management to illustrate the more socially innovative approaches of problem solving in a crisis context. The article thus attempts to respond to the ongoing need for innovative approaches for crisis management while simultaneously illuminating the frontiers of the S ENT phenomenon.

The article is structured as follows: Firstly, the succinct literature on COVID 19, entrepreneurship, and crisis management are explored. Next, the article proceeds to discuss the relevance of entrepreneurship and S ENT with the management of the crisis. Subsequently, the dimensions of the S ENT phenomenon suited to deal with the crisis are identified and discussed. The article concludes with a detailed conclusion at the last.

Theoretical Background Nature Of Covid-19 Crisis

A crisis is broadly referred to as an event that is characterized by ambiguity of cause, effect, and means of resolution. Therefore, crises are events that belong to the “un ness” category: undesirable, unexpected, unimaginable, and often unmanageable situations’’ (Hewitt, 1983), occurring on an infrequent basis, incorporating danger with a tendency of invoking catastrophic consequences (Moerschell & Novak, 2020). Therefore, crises follow an unpredictable pattern making them difficult to handle (Parker & Ameen, 2018). Considering the dynamic nature of the crisis, a more direct and swift reaction is usually required to handle the crisis (Weick & Sutcliffe, 2011). Consequently, the management of a crisis demands a coordinated response involving individuals, businesses, and governments (Shrivastava, 1993). Accordingly, to mitigate the crisis, the continuous flow of information (about how the crisis is manifesting itself) as well as ensuring pre emptive messages (which instructs about the required actions to be taken) through knowledge sharing are required to be communicated in a direct manner (Doern et al., 2019; Kirk & Rifkin, 2020; Liu et al., 2017).

Therefore, like other grand social challenges (like climate change, poverty, etc.), the COVID 19 calls for cooperation across disciplines and communities to deal with the crisis (see George et al., 2016). This has implications for research and scientific institutions to bring coordinated outputs for helping society. Nevertheless, despite the need for collaboration, there has been competition amongst regions for health supplies and other depleting resources during the COVID 19 crisis (USAID, 2020). Therefore, such crises warrant deeper innovative interventions for their management.

Accordingly, the emerging studies suggest innovation driven processes to deal with the COVID 19 crisis. For example, Cankurtaran and Beverland (2020) propose a three stage innovation process (disrupt define and develop transform) as useful to handle the covid 19 crisis.

The consequences of the COVID 19 pandemic resulted in individuals and societies adjusting to new norms and it changed the ways things/work is being done. Thus, it is contended to think outside the box to implement such new processes, involving the examination of the problems to find the underlying cause (Williams et al., 2017). Therefore, an efficient process is required to dissect the problems to find effective solutions (Wenzel et al., 2020).

Entrepreneurial Intervention For Covid-19 Crisis

There has been a huge uncertainty about how the COVID 19 will evolve (Parnell et al., 2020). Due to rapid and unprecedented societal disruptions caused by COVID 19, the typical bureaucratic response did not apply; instead, the new norms of social distancing like the use of face masks, hand hygiene, and social distancing were introduced. Accordingly, with the diversity of approaches and policies interventions of regions to handle the crisis, the contextual information or local specific understanding is found vital (Kraus et al., 2020). Therefore, a continuous risk or threat assessment is needed to evaluate the likely impact of the COVID 19 crisis. While this scenario represents a danger to society, it simultaneously presents an opportunity as well, depending on how the businesses respond to such situations (Alon et al., 2020). Meanwhile, the organizations tend to respond to the crisis in varied ways which can range from restructuring the business practices, reconfigure the supply chains to reduced outputs, etc. Consequently, the agility and resilience of organizations will determine the sustainability of their business models in times of crisis (Parker & Ameen, 2018). While giant organizations and governments can respond to the crisis more effectively, however, small businesses are found as more flexible to adapt quickly to the situations (Ebben & Johnson, 2005)

Since entrepreneurship involves responding to dynamic market changes through identifying opportunities or problems, taking the risk, orchestrating resources, and experimenting with new processes to bring in innovation (Shahid & Alarifi, 2021), it is thus strategically suited to cater to the crisis. Accordingly, the entrepreneurial understanding is argued to offer the ways through which to curtail the crisis and its impacts on lifestyle, culture, and social interactions (Ratten, 2020a). For instance, the rapid development of medical technologies along with the emergence of novel ways of handling the COVID 19 crisis will expectedly unlock more entrepreneurship (Kuckertz et al., 2020; Ratten, 2020a). Subsequently, entrepreneurs who respond and adapt to crises will tend to have global influence (Liguori & Winkler, 2020). Considering the COVID 19 effects on lifestyle, culture, and social interactions, Ratten (2020) posits that incorporating entrepreneurship thinking in COVID 19 research is essential due to the unique ways through which entrepreneurship can respond to the challenges.

Unlike other crises, the COVID 19 is an ongoing concern with an unknown period (He and Harris 2020). Considering the COVID 19 shifts in the way things are currently done, entrepreneurs need to share and analyse the current business environment to anticipate change and adapt rapidly to focus on new trends (Ratten, 2020). Although, COVID 19 is still evolving uncertainly (World Health Organisation, 2020), there lies much uncertainty about how it will impact entrepreneurship and how entrepreneurship can be shaped to cater to its crisis. Nevertheless, transforming the innovation in terms of more societal effects or social value creation is certainly helpful in mitigating the issues that have arisen (Ratten, 2020). In the direction of social value creation, S ENT typically has the advantage of scaling the local innovative solutions or develops innovative solutions that replicate the best of what has worked elsewhere (Bacq & Lumpkin, 2021). Thus, we contend that SE has a strategy suited to curtail the COVID 19 crisis as evidence through the following discussion.

Nature Of Social Entrepreneurship

S ENT represents a paradigm shift by fostering a bottom up approach of development through addressing the varied socio economic problems (Alex, 2006; OECD, 2013; Robinson et al., 2009; Satar & John, 2016). S ENT venturing is thus reported to carry significant influences on the individuals, communities, and the socio economic conditions of the countries in general (Amin et al., 2003; Bornstein, 2007).

S ENT is majorly referred to as a process of creating social value using commercial entrepreneurial strategies (Satar & John, 2019; Sullivan et al., 2003). While S ENT is argued to be as a process to change the world (Chell, 2007), others view S ENT in a more mechanistic way as essentially a process of ‘‘identifying, evaluating and exploiting opportunities aiming at social value creation,” (Defourny & Nyssens, 2006; Nicholls, 2008; Satar & John, 2019). Parallelly, S
ENT has also been referred to as the act of innovative use and combination of resources for the sake of driving the social transformation (Peredo & McLean, 2006). Alternatively, S ENT represents the core ideology of an individual, group, or business organization seeking out social issues or attempting to capture social value/impact (Creto & Miller, 2008).

Accordingly, social entrepreneurs have emerged in response to the failure of the state and private sector to meet the needs of the society (Borzaga & Santuari, 2001; Alvord et al., 2004). The social entrepreneurs are increasingly recognized as bold, opportunist individual change agents, spearheading social change and creating social value (Dees, 1998; Sullivan et al., 2003; Sullivan et al., 2006). Social entrepreneurs as visionary leaders recognize the social value opportunities in situations where others see unvalued resources (Catford, John. Cited in Johnson; Sherryl, 2000). They create new ways of tackling social problems while finding new and better ways of doing things (Dees, 1998).

Social entrepreneurs in general are driven by a double or triple bottom line objective: financial, social, and environmental value creation. Here, the financial value is a goal for social entrepreneurs as a means to the end of social value creation (Boschee & McClurg, 2003). S ENT has a unique ability to create powerful social impacts that drive the energy of stakeholders towards a more sustainable future (Youssef et al., 2018). In order to bring social transformation or create a positive social change, social value creation becomes the pivotal or indispensable purpose of all S ENT efforts. Therefore, S ENT enables value co creation in the S ENT ecosystem by orchestrating the resources to solve social problems innovatively (Mair & Marti, 2006).

The social value orientation of social entrepreneurs can manifest itself in the form of social values, social motives, or simply value prepositions (Holm, 2007). Some of the distinctive abilities associated with the social enterprise leaders are their passion and commitment for a cause, volunteer service orientation, collaborative leadership style, and ability to perceive an opportunity for social value creation, etc. Therefore, the entrepreneurial orientation of social entrepreneurs including risk taking, reactiveness, innovativeness, and social passion (Satar & Natasha, 2019) combined with the above traits and abilities make them more suited to respond to the COVID 19 crisis as compared to non social entrepreneurs. The following sections review aspects of S ENT which have strategic relevance for managing the COVID 19 crisis.

Social Enterprises Business Models And Their Positioning For Crisis Management

Social enterprises represent an innovative and sustainable model of social problem solving (Dees et al., 2002; Chell, 2007; Satar & John, 2016). Accordingly, the S ENT has become a global phenomenon, impacting societies by catalysing social transformations for societal wellbeing. While addressing the basic human needs, the S ENT phenomenon can take place in any society. Often such local initiatives have the potential for scale up and replication at the global level (for instance, Microfinance of Bangladesh). Thus, the produce in the case of S ENT can be in the form of a product, service, or a utility meant for the benefit of the community at large. While fostering social innovation, S ENT practice stimulates ideas for sustainable and socially acceptable strategies and enterprise forms (Sullivan et al., 2003).

Accordingly, the social enterprises are emerging as cooperative or charitable businesses having a primary social mission with socialized ownership and, a democratic multi stakeholder base (Alex, 2006). Majorly these enterprises have been referred to as ‘‘businesses with primarily social objectives and their surpluses are principally reinvested for that purpose in the business or the community” (Department of Trade and Industry, 2001). This highlights the way through which social value is required to solve social problems (Dacin et al., 2011). The degree of social embeddedness of social enterprises may range from human capability building, empowerment of disenfranchised people, responding to unmet needs, creating new forms of work (Amin et al., 2003) improvement of the quality of people’s lives, fighting a range of other social issues (Peredo & McLean, 2006; Korosec & Berman, 2006; Alvord et al., 2004), furthering more inclusive growth (OECD, 2014), sustainability of environment to wider goals of social change and social value creation (Dacanay, 2004).

Thus, social enterprises strive to reach the bottom of the pyramid and are thus principally engaged in delivering services to society. Through work integration mechanisms, the social enterprises deliver community services by actively engaging the beneficiaries (Teasdale, 2012). The involvement in successful income generating activities leads to greater control over the empowerment in communities (Fung & Wright, 2003). The social enterprises, regardless of their organizational forms and geographical contexts strive to integrate the poor into the market system as producers rather than as consumers (e g The Grameen Bank, Bangladesh).

Thus, through the process of market integration, the bottom of the pyramid beneficiaries can be served in a much better way (Karnani, 2007). For instance, with successful community engagement, the Sekem group in Egypt was able to diversify its social entrepreneurial efforts to include a hospital, university, etc.; Arvind Eye Care, India was able to extend the social entrepreneurial efforts to include education, lens manufacturing, and R&D facilities. Likewise, the ‘‘Lijjat’’, a unique Indian social entrepreneurial venture illustrates ‘‘how women at a grassroots level became active agents in the process of their empowerment’’ (Datta & Gailey, 2012). Therefore, S ENT generates social value through the engagement of local stakeholders and beneficiaries, which determines the long term success and sustainability of such enterprises (Satar, 2016; Satar & John, 2019). This is particularly suited to the COVID 19 crisis where the sharing and engagement of stakeholders can go a long way to identify the approaches to manage the crisis at the local levels.

Collaborative Social Value Creation

The second important feature of SE which has implications for managing the COVID 19 crisis is the creation of social value through networking across organizational boundaries (Austin et al., 2006; Satar & John, 2019). The success of S ENT effort often comes from the groups or teams who used group or distributed entrepreneurship involving networking with a range of stakeholders (Spear, 2006). Collaborating and networking have emerged as the distinct ability of social entrepreneurs (Alvord et al., 2004; Austin et al., 2006).

The inter organizational networks and social capital of social entrepreneurs lead to greater identification of social value opportunities, greater access to resources, information, skills, and experience required in the new venture creation process (Bornstein, 2007; Dees et al., 2002; Shaw and Carter, 2007). Social enterprises manage a broad set of relationships with managers, staff, volunteers, board members, partners, and funders, etc. in order to work with other actors (businesses and/or government) & to access resources e.g., through partnerships (Austin et al., 2006; Mair & Martí, 2006). In the process of realizing the social change, the collaborating ability of social entrepreneurs enables them to communicate their vision to a broad base of stakeholders (Thompson et al., 2002).

The social entrepreneurs irrespective of the sector in which they operate act as coordinators in channelizing the energies of different stakeholders towards the organization’s vision and mission. In the process of social enterprise development, leaders have been found to network, collaborate across different sectors for the sake of understanding critical business aspects, building support at various community levels and other stakeholders. Beyond this, leaders have been found to possess a keen understanding of cross sectoral issues and constant focus to secure private or public investments. Leadership and strategic alliances with suppliers have been regarded as crucial factors for determining the organization’s success (Terziovski et al., 1996).

The impact of social networks is considered critical in community business development. Such influences of social networks over local community development have been found in many small towns (Hayton et al., 2002). For example, certain sector platforms in India like ‘Jagriti Yatra’, ‘Sankalp’, ‘Unconventional local’, ‘Artha Platform’, ‘Idobro’ etc., are organizing local events to create awareness and thus are encouraging networking in Indian cities. Further, social enterprise incubators like ‘Villgro’’ (www.villgro.org), ‘Dasra’ etc. are continuously striving to strengthen the ‘social enterprise ecosystem’ in smaller cities and rural areas in India.

Few of the evidence comes from the growth of Silicon Valley which was made possible through social solidarity and collective learning (Swedberg, 1997) and ‘‘emergence of business districts in Europe’’ (Johnson, 2000). The ensuing development is attributed to the way the networks facilitate innovation and learning and thus enable the members to respond to the challenges (Hayton et al., 2002). Thus, social value is created by incorporating the people, planet, and profits within market based approaches of social enterprises (Wilson and Post, 2013).

Alternatively, this approach of S ENT focuses on collaborative learning for creating social value (Smith et al., 2008). This feature of S ENT corresponds to the need for knowledge sharing about the crisis affecting society (Kickul et al., 2018). In summary, the collaborative feature of S
ENT activities through cross institutional partnerships can significantly contribute to the development of approaches to handle the COVID 19 crisis.

Scope For Social Value Creation Through Digital Collaboration

The aftermaths of COVID 19 have impacted the way life is conducted with prospects for further social change (World Health Organization, 2020). Contactless services are becoming a new norm with the decrease in interpersonal interactions (Cortez & Johnston, 2020). Accordingly, there is more dependency on social initiatives and digital communication. In this direction, digital technologies are presumed to offer new alternatives unlocking the opportunities for leveraging the digital platform for value creation in crises.

At times of social challenges, S ENT initiatives can offer a unique platform to create a timely and practical response to mitigate the crisis. However, a crisis like COVID 19 which resulted in varied social economic, and cultural shifts in the living and working conditions, can prove to be a formidable task to deal with. The digital platforms are thus presumably powerful enablers of entrepreneurial collaborations during times of such grand social challenges. One such approach was recently demonstrated by the development of a Covid 19 response, referred to as “virtual idea blitz.” by faculty members at Indiana University’s ‘Kelley School of Business’ (Bacq et al., 2020). This quick S ENT approach was delivered through virtual, collaborative events that sought to rapidly identify and develop solutions to extreme problems created by COVID 19 and thus create social value.

The idea integrated aspects across the disciplines and collaborated entrepreneurs, venture capitalists, industry professionals, medical doctors, students, and professors from around the world and generated a communal, high impact response to COVID 19 (Bacq et al., 2020). Such entrepreneurial responses have recently been referred to as ‘entrepreneurial hustle: the urgent, unorthodox actions aimed at handling the immediate challenges and opportunities under uncertain conditions and constrained resources’ (Fisher et al., 2020). Since behaviours like “virtual idea blitz.” match the entrepreneur start ups process, we contend that such rapid social value creation endeavours can be instigated by individuals, businesses, or other institutions alike in diverse contexts across the globe. Thus, it posits S ENT as an ideal candidate for responding to crisis management through digital interventions.

Secondly, since S ENT is deeply seated in local contexts, they are in a better position to identify and respond rapidly to changing societal needs more effectively. A parallel thought of collaboration between existing SE’s seems prosperous of developing rapid yet far reaching responses during crises. Social enterprises are characterized by the diversity of missions, structures strategies, and processes (Dees et al., 2002; Satar & John, 2019). Accordingly, social entrepreneurs are found operating across diverse geographic, economic, and social contexts across the globe (Bornstein, 2007; Satar, 2016). Arguably, a digital collaboration across social enterprises and S ENT ecosystems at different layers of society can prove to be a powerful tool to identify the social value creation opportunities, share resources, and scale the local solution to the global context.

This way, the collaborative initiatives can help leverage the energy of networking through the engagement of diverse benefactors (including government and private) who intend to create social impacts. The aftermaths of COVID 19 have impacted the way life is conducted with prospects for further social change (World Health Organization, 2020 . Contactless services are becoming a new norm with the decrease in interpersonal interactions (see Cortez and Johnston, 2020). Accordingly, there is more dependency on social initiatives and digital communication. In this direction, digital technologies are presumed to offer new alternatives unlocking the opportunities for leveraging the digital platform for value creation in crises.

Conclusion

COVID 19 resulted in a formidable health pandemic that not only leads to a massive health crisis but also altered the current social, cultural, and economic systems across the globe. Unlike other crises, COVID 19 is considered an ongoing condition with an indefinite time. Therefore, social challenges like COVID 19, warrant novel responses that implement innovative, impact
driven, and more unorthodox attempts to mitigate the crisis. Nevertheless, while the crisis posed massive challenges with unprecedented social norms, it simultaneously unrevealed lessons for more entrepreneurial approaches entailing social innovations. Such learning’s have implications for managing the crises requiring social changes. The social innovations through S ENT have assumed the potential to curtail such situations and create more positive social values. The primary aim of this article is to understand the ways through which S ENT can be leveraged as a tool for managing the crises as the ones that emerged from Covid 19. In particular, the nature and dimensions of S ENT were highlighted as a way of responding to the ongoing socio economic challenges. The main social entrepreneurial aspects of collaborative social value creation, social enterprise business models, networking as well as scope for value creation through digital collaboration make S ENT are strategically suited to cope with the crisis emerging from COVID
19 or future such catastrophes. This has scope for deriving the research prepositions for potential research exploration.

Further, as COVID 19 is still evolving uncertainly, there lies much uncertainty about how it will impact the S ENT and how S ENT can be shaped to cater to its crisis. This indicates that more research on how S ENT can be used as a strategy to cope with the crisis is needed. Therefore, the article is intended to aid the management, business, and entrepreneurship scholars and practitioners as well as the other stakeholders of the S ENT ecosystem to stimulate the value driven approaches to a variety of societal grand challenges facing our world.

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