The William Davidson The William Davidson InstituteInstitute

WDI’s Mission

To create, aggregate, and disseminate intellectual

capital on business and policy issues in emerging

market economies

WDI’s Major Activities• Research

– Base of the Pyramid – Social Enterprise– Globalization of Services

• Executive Education • Development Consulting Services• Educators’ Outreach• Promoting International Activities at U-M

– Business School– Supporting key international activities at other schools

• School of Public Health• Medical School• School of Natural Resources

Knowledge CreationExp

erien

ces

Teaching/

Dissemination

Research Initiatives

Support for Int’l Activities- Students- Faculty

- Exec Education

- Educators Outreach

Research Support

Development Consulting

Conferences

Convergence of the Sectors: Convergence of the Sectors: Social InnovationSocial Innovation

Traditional Value Creation

For ProfitNon-Profit

Government

For Profit

Blended Value Creation= Innovation

Non-Profit

Government

Causes of ConvergenceSupply Side

• New Wealth/Philanthropists• Increased Visibility (popular

press coverage, celebrities• Technology• Attempt to reach new

markets• Improved transportation and

communication

Demand Side:

• Traditional Development Failures

• Increasingly Complex Social Problems

• Inability of government to provide public goods

• Foundations Requiring more Accountability/Innovation

• Scarcity of traditional resources (grants)

The Social Entrepreneurship Landscape Has Become More

Complex

Community Development Corporations

Corporate Social Responsibility

VenturePhilanthropy

Social Stock Markets

Social EnterpriseThe Micros

Business/Social Hybrids

Community Foundations

Bottom of the Pyramid

SocialInvesting

Public Private Partnerships

Fair Trade

Social Entrepreneurs

Nonprofits (NGOs,CSOs)

Socially Responsible Business Leaders

Activists

Thought Leaders

The LandscapeSocial

Entrepreneurship

Foundations/MultilatsGovernments

Results of Convergence:Hybrid Spectrum

NGO w/Income

-Generatin

g Activities

Nonprofit Enterpris

e

BoP Enterpris

eSocial

VentureSocially

Responsible Business

Corporate Social

Responsibility

Corporate

Strategy

Mission MotiveStakeholder Accountability

Income reinvested in social programs or overhead

Profit-making Motive

Profit redistributed to shareholders

Shareholder Accountability

Results of Convergence:New Sector MotivationsCharacteristics and/or Perceptions

For Profit HYBRID Not for Profit

Competitive Collaborative

Private Good Social Good

Market Based Outside Market

Financial Motivation Social Motivation

Advantaged Disadvantaged

Independent Dependent

Individual Collective

Risk-taking Risk-averse

Create Wealth Distribute Wealth

Results of Convergence:Social

Entrepreneurship/Innovation

• New Structures• New and Adapted Business Models• New Methods to Mobilize Capital• New Sector Stakeholders• New Fields and Terminology

Social Innovation: Why?

• Exciting • Inspiring• Opportunities Abound• High Impact Possibilities• Fast Moving• Constantly Evolving

QUESTIONS?QUESTIONS?

Social Innovation: New Structures

• Partnerships/Strategic Alliances• For-profits with Embedded Social

Mission• Non-profits Generating Revenue• Non-profit Consulting

Social Innovation: Adapted Business Models for Enhanced

Social Value

• Micros: finance, enterprise, franchise• Social Franchising• Non-profit Incubators• Base of the Pyramid• Fair Trade

Social Innovation: New Methods of Mobilizing Social and Financial

Capital

• Foundations Supporting For-profits• Market Driven Philanthropy• Social Venture Capital/Investing• Venture Philanthropy• Adapted Private Sector Tools• Community Foundations• Corporate Volunteerism• Community Development Corporations

Social Innovation: New Stakeholders

• For-profitsEmployees, Customers, Suppliers, Distributors, Communities, Non-profits

• Governments (Outsourced Services) Non-profits, For-profits, Communities

• Non-profits Donors (with expectations of higher, more accountable returns), Individual Investors, For-profits, Government

Social Innovation: New Fields/Terminology

• Social Entrepreneurship• Social Enterprise• Base of the Pyramid• Micros• Social Investing• Venture Philanthropy• Fair Trade