A hybrid revolution enabling a sustainable response to social problems through multiple entities : a case study on Shonaquip

Thesis (MPA)--Stellenbosch University, 2017.ENGLISH ABSTRACT: "There is an idea that values are divided between the financial and the societal, but this is a fundamentally wrong way to view how we create value. Value is whole. The world is not divided into corporate bad guys and social heroes." —Jed Emerson. While the definition of social enterprises remains elusive, they are generally understood to be organisations that have a social impact focus while generating income through trade in goods or services. Hybrid social enterprises are a relatively new organisational structure utilising a combination of both non-profit values and business principles, often combining a range of income streams and occasionally using more than one legal entity. This thesis proposes that social enterprises, and particularly hybrid social enterprises, build on the long history of civil society organisations as they evolve new ways of delivering social change. It is this history that should guide social entrepreneurs as they choose organisational and business models to deliver social impact. Recognising the lessons of traditional vehicles of social change will allow social entrepreneurs the opportunities to both leverage the benefits provided by different organisational forms and overcome their limitations. This is particularly important as organisations strive to create sustainable social change. Hybrid social enterprises are an extraordinary opportunity to decouple social change entities from dependency on funding. By combining the strengths and resources available to both non-profit and corporate systems, hybrid social enterprises have the potential to exploit the differences and benefits of both structures to make a long term, financially viable, impact. A “hybrid ideal” is an organisation where every element of the organisation, both commercial and non-profit, delivers on the intended social impact. This is not always possible and maintaining this vision across organisations can be a challenge. One of the risks associated with social enterprises is “mission drift” where one income stream may shift the organisation’s focus away from the original vision. This challenge is exacerbated when the hybrid consists of more than one legal entity. The 25 year history of Shonaquip, one of South Africa’s oldest and most successful hybrid social enterprises, has significant lessons for academics and practitioners as they actively wrestle to create models to sustainably scale a hybrid social enterprise while maintaining the core vision and purpose. Shonaquip’s position as a successful hybrid ideal in a low resourced country is particularly important as dependency on international grant funding wanes in light of global economic challenges. Through the case study, this thesis frames hybrid social enterprise within a civil society context and provides practitioners with lessons learnt on a journey to balance sustainability and impact. Finally the thesis hopes to present practitioners and researchers with a unique model of a hybrid ideal consisting of multiple entities designed to deliver on a component of a holistic approach. Each different legal entity is able to leverage unique benefits integral to its foundation be it as an NPO, limited company or trust, while still committed to an integrated holistic vision.AFRIKAANSE OPSOMMING: "Daar bestaan 'n idee dat waardes verdeel is tussen die finansiële en die maatskaplike, maar dit is 'n fundamenteel verkeerde manier om te bepaal hoe waardes geskep word. Waardes is ‘n geheel. Die wêreld is nie verdeel in korporatiewe boewe en sosiale helde nie." —Jed Emerson Terwyl die definisie van maatskaplike ondernemings ontwykend bly, word hulle oor die algemeen gesien as organisasies wat 'n sosiale impak fokus het, terwyl inkomste gegenereer word deur middel van die handel in goedere of dienste. Hibriede sosiale endernemings is 'n relatief nuwe organisatoriese struktuur wat gebruik maak van 'n kombinasie van beide nie-winsgewende waardes en sakebeginsels. Dit is dikwels ‘n kombinasie van 'n verskeidenheid inkomstebronne en soms die gebruik van meer as een regspersoon. Hierdie tesis stel voor dat sosiale ondernemings, en veral hibriede sosiale ondernemings, bou op die lang geskiedenis van burgerlike organisasies soos wat hulle nuwe maniere vir die lewering van sosiale verandering ontwikkel het. Dit is hierdie geskiedenis wat sosiale entrepreneurs moet lei om organisatoriese en sakemodelle te kies wat sodoende ‘n sosiale impak kan bewerkstellig. Indien die lesse van tradisionele werktuie van sosiale verandering in ag geneem word, sal dit sosiale entrepreneurs die geleentheid bied om beide die voordele van verskillende ondernemingsvorme te benut en hul beperkings te oorkom. Dit is veral belangrik as organisasies daarna streef om volhoubare sosiale verandering te skep. Hibriede sosiale ondernemings is 'n buitengewone geleentheid om entiteite vir sosiale verandering los te maak van hul afhanklikheid van befondsing. Deur die kombinasie van die sterkpunte en hulpbronne wat beskikbaar is vir beide nie-winsgewende en korporatiewe stelsels, het gemengde sosiale ondernemings die potensiaal om die verskille en voordele van beide strukture te benut om 'n langtermyn, finansieel lewensvatbare, impak te maak. ‘n "Hibriede ideaal" is 'n organisasie waar elke element van die organisasie, beide kommersieel en nie-winsgewend, ‘n bydrae maak op die beoogde sosiale impak. Dit is nie altyd moontlik nie en die handhawing van hierdie visie oor verskeie organisasies kan 'n uitdaging wees. Een van die risiko's wat verband hou met sosiale ondernemings is "missie verskuiwing" waar een inkomstestroom die organisasie se fokus kan verskuif van die oorspronklike visie. Hierdie uitdaging word vererger wanneer die hibriede bestaan uit meer as een regspersoon. Die 25-jarige geskiedenis van Shonaquip, een van Suid-Afrika se oudste en mees suksesvolle hibriede sosiale ondernemings, het beduidende lesse vir akademici en praktisyns. Hulle aktief stoei om modelle te vorm wat 'n volhoubare hibriede sosiale onderneming te weeg kan bring, en steeds die kern visie gehandhaaf word. Shonaquip se posisie as 'n suksesvolle hibriede ideal, in 'n land met lae hulpbronne, is veral belangrik in die lig van die verminderde afhanklikheid van internasionale subsidie wat kwyn as gevolg van die wêreldwye ekonomiese uitdagings. Die gevallestudie, toon dat die hibriede sosiale ondernemings in die konteks van ‘n burgerlike samelewing, voorsien praktisyns van lesse ten einde volhoubaarheid en impak te balanseer. Ten slotte, word gehoop dat die tesis ‘n unieke model voorhou wat bestaan uit verskeie entiteite wat elk ontwerp is om te funksioneer volgens 'n komponent van 'n holistiese benadering. Elke aparte regspersoon is in staat om unieke voordele te benut wat ‘n integrale deel van sy stigting uitmaak, of dit nou as 'n NPO, beperkte maatskappy of trust is, terwyl dit nog verbind bly tot 'n geïntegreerde holistiese visie