Strategic niche management of social innovations: the case of social entrepreneurship

Abstract

Strategic niche management (SNM), a tool to understand and manage radical socio-technical innovations and facilitate their diffusion, has always departed from a technical artefact. Many radical innovations, however, do not revolve around such an artefact. Social entrepreneurship is a new business model that combines a social goal with a business mentality and is heralded as an important new way to create social value such as sustainability. This study examines if and how SNM can be applied to such a social innovation. It identifies theoretical and practical limitations and proposes solutions. The main conclusion is that SNM can be used to analyse radical social innovation, although it requires rethinking the initial entry point for research and management. Exemplifying quotes are proposed as an alternative. Second, this paper suggests using values to describe niche–regime interaction as a better way to anticipate future niche–regime interactions.

Keywords:

• multi-level perspective
• social entrepreneurship
• social innovation
• socio-technical regime
• strategic niche management
• SNM
• value

Notes

There is in fact an ongoing discussion about whether desirability of the innovation is an important requirement for SNM. Increasing numbers of (as yet unpublished) SNM studies focus on innovations that are not necessarily desirable and these studies face no compatibility issues. Whether it is morally defendable to use SNM to facilitate technologies that cannot be generally characterised as desirable (e.g. better oil exploration techniques) is the real question here.

Note that this adds up to more than 100% since some organisations have multiple legal entities. Notably absent are the ‘Public Limited Company’, and the ‘Cooperative’. This last absentee is a central subject in the writings of Borzaga and Defourny (2001), but its absence can be explained by the difference between social enterprise, on which Borzaga and Defourny focus, and social entrepreneurship (see the theory section for a small discussion on this topic).

Sustainable investment funds are growing more rapidly than the market as a whole, leading to an increasing availability of investors interested in social performance. The limited socially interested funds, however, so far have invested most of their money abroad or in stocks, both of which exclude Dutch social entrepreneurs since none has (yet) gone public.