Social enterprise-business partnerships : exploring the influence of institutional logics upon social enterprise partnership experiences and decision-making

Social enterprises are organisations that pursue a social mission through the application of market-based strategies, whereby revenue generated from business activities is reinvested back into the enterprise to support the achievement of key social objectives. As hybrid organisations, social enterprises are required to balance social benefit and commercial institutional logics. These logics provide social enterprises with systems of values, actions and beliefs that guide organisational action, problem-solving and decision-making, as well as the sense of identity of organisational actors. The combination of these potentially contrasting logics can lead to the development of internal tensions and conflict, and may also create difficulties for social enterprises when establishing legitimacy with external stakeholders. These challenges impact upon the access of social enterprises to needed resources and support, and can create resource scarcities that threaten the achievement of social and commercial sustainability. In order to meet the increasing demand for their services, partnerships with profit-oriented organisations (businesses) are being pursued as a strategy through which social enterprises may access resources needed to enhance their sustainability, and achieve their social benefit and commercial objectives. To date, limited research has been undertaken into social enterprise-business partnerships. As a result of the emergent nature of the literature, the influence of social enterprise hybridity upon interactions with external stakeholders to build, implement and maintain their relationships is not well understood. Moreover, an understanding of the influence of business partner logic upon the enactment of the social benefit and commercial logics of social enterprise within their partnership decision-making has yet to be developed. This research explores the following question: How does the combination of social benefit and commercial logics within social enterprise-business partnerships influence the manner in which social enterprises establish and manage their relationships in order to achieve the enterprise’s social and commercial organisational objectives? The research framework developed in this study explores social enterprise experiences and decision-making across four components of partnership: the decision to form partnerships with for-profit businesses (partnership motivations), the assessment and selection of potential business partners (partner selection criteria), the interactions between partners (partnership implementation), and the outcomes of partnership. A multiple case study design examining six Australian-based education and training social enterprises was adopted, in which documentary data and semi-structured interviews with key decision-makers were used to explore social enterprise partnership experiences and decision-making. The research found that the influence of social enterprise institutional logics differed according to stage of partnership. Overall, the decision-making undertaken during the initial stages of partnership was shown to be commercially pragmatic, with the driver for partnership and selection of partners revolving around the commercial needs and capabilities of the enterprise. The findings illustrate that contrary to assumptions within the literature, the dynamics of the relationships studied were predominantly positive, characterised by reciprocated trust and strong interpersonal relationships. In addition, the commercial competencies of social enterprise were shown to enhance their exchange value, balance out power dynamics between partners, and contribute to the development of relationships that generated shared value. Whilst the commercial logic of for-profit business partners was shown to be a factor influencing decision-making and partnership adaptations, factors such as the level of enterprise maturity, partnership experience, enterprise model, and the nature of the relationship itself were also shown to influence how the social benefit and commercial logic of the social enterprises influenced the way in which relationships were formed and managed with for-profit business organisations. This thesis concludes by discussing the contributions made by this research to social enterprise partnership theory, and provides suggestions on how these findings may be used to enhance the management of social enterprise-business partnerships. Suggestions regarding promising avenues for future research into the partnership strategies developed by social enterprises are also provided, with the aim of developing further insights into the social enterprise-business partnership phenomenon