1.1. Setting the stage: A call for synthesis
Recent financial scandals and the ongoing global financial crisis not only cast dark clouds on the traditional paradigm of Western style capitalism but also call for entrepreneurs which regard economic activity and corporate social responsibility as mutually inclusive (anonymous, 2011). Some authors (i.e. Jamrozy, 2007) even suggest a corporate aim to be orientated towards the improvement of quality of life for all. These developments clearly point to a new mindset and school of entrepreneurs and an increased social importance (Thompson, 1999) of entrepreneurs reflected in the concept of social entrepreneurship which is still in its infancy stage. Against the background of the still ongoing transition of Central and Eastern European countries from a centrally planned economy to a market economy, this contribution suggests a synthesis and internal consistency between the concepts of cross-sectoral partnerships, social entrepreneurship and management and marketing as well as traditional entrepreneurship related concepts. The problems in CEE countries are illustrated by apparent gaps (Kaufmann, Davies and Schmidt, 1994) and in ethnic or societal conflicts, for example, in the Balkan or Caucasus region (Kaufmann, Zagorac and Sanchez, 2008). These multifacetedproblems require the involvement of other than non-governmental organizations due to the coherence of political, social and economic problems. Regarding previous research in Eastern Europe in this context, Kaufmann, Davies and Schmidt (1994) suggested resorting to ‘synergy experience’ for behavioral change.Unfortunately, there is a gap between the calls of the Millennium Declaration for the co-operation between the public sector, private and civil sector aiming to reduce the poverty levels in the world (Friedrich and Gale, 2004) and the concept of Global Governance for a cross-sectoral co-operation of politics, economy, science, civil society/NGOs and media for the development of a world order (Gruber, 2003) and its actual implementation on a local, regional and national level.
In this context, civil society organizations (CSO) alone cannot avoid the emerging discrepancy between the development of city centers and the marginalization of rural regions. In addition, the currently isolated and emphasized focus on the civil sector in this respect faces resistance from the population which is still not familiar with these organizations. Newly to be designed development projects increasingly have to take country or even region specific forms of common civil, governmental and entrepreneurial engagement into consideration aiming to create self-organized and self-financing sustainable structures (localization). Eventually existing external role models cannot just be copied, but are suggested to be gradually internalized and adapted according to idiosyncratic local conditions calling for new exploratory, ethnographic and qualitative empirical research approaches. Attempting to bridge these gaps and solve the problems in a most efficient way, this contribution, in line with Grossman (2008), calls for a concerted action and an Across-the-Sectors Development Partnership integrating organizations of the civil society (CSO), governmental organizations and social entrepreneurs synergizing the contributions of the diverse actors when designing, financing and implementing appropriate strategies.
This proposal corresponds with the new public governance paradigm by integrating policy making (public administration) and effective service delivery processes (new public management) (Osborn, 2006, in Paerenson, 2011). If the assumption is accepted, that private sector managerial techniques can add to increased levels of effectiveness and efficiency of the respective service delivery processes, then entrepreneurship (Grossman, 2008) and, especially, social entrepreneurship might have a significant role to play (Paerenson, 2011). Due to its disequilibration role, entrepreneurship in general seems to be a valid concept to affirmatively cope with transitional situations (Kaufmann, 2009).
This research follows the most recent suggestions of Paerenson (2011) for future research to provide so far not existing empirical evidence on the criteria for impact evaluation of social entrepreneurship. It contributes to inform the current discourse on the actual effectiveness of social entrepreneurship raging between protagonists and opponents of the concept. Going beyond that suggestion, the paper intends to provide a holistic conceptual framework on the key success factors of effective social entrepreneurship differentiated by idiosyncratic Eastern European conditions and suggests criteria for impact assessment. For the aforementioned reasons, case studies in Central and Eastern Europe (Hungary, Bosnia and Herzegovina and Croatia) have been chosen as the most appropriate research method and settings. The case studies relate, for example, to addiction prevention in Bosnia Herzegovina or the reformation of governmental youth support in Hungary or informal adult education in Croatia.Due to the idiosyncratic macro, meso and micro environmental conditions in transition countries, compared to established economic settings, a differentiation of the, albeit scarce, theory on social entrepreneurship is anticipated. Based on a constructivist ontological background, the researchers provide empirical findings of participant observation (resulting from longstanding consultancy activities), in-depth group interviews and focus groups as the chosen ethnographic research techniques. The innovative findings analyzed by content analysis are suggested to inform educators and trainers of social entrepreneurs and create enhanced awareness for legislators on how to better support social entrepreneurship.
As Corporate Social Responsibility provides the overarching theory for social entrepreneurship, the following paragraph sheds light on central pillars of this concept.
2. Corporate Social Responsibility
The concept of corporate social responsibility is in an evolving stage, positions on many CSR related issues are still diverse, and empirically tested holistic concepts to understand the issues involved are urgently required. There are many facets attributed to corporate social responsibility: “corporate social responsibility, corporate citizenship, corporate philanthropy, corporate giving, corporate community involvement, community relations, community affairs, community development, global citizenship, corporate societal marketing, society and business, social issues management, public policy and business, stakeholder management, corporate accountability, or corporate sustainability” (Garriga&Melé, 2004, Kotler& Lee, 2005, in Marquina, 2007, p. 5).
Moreover, Moir (2001) proposes additional issues related to corporate social responsibility, such as workplace (employees), marketplace (customers, suppliers), environment, ethics and human rights. Padmakshi, Platts and Gregory (2009), based on a synthesis of conceptual frameworks (Elkington, 1998, CSD Report 2001, Bradby, 2005, GRI Report, 2006, Labuschange et al., 2006, Elliot, 2006 in Padmakshi, Platts and Gregory, 2009, p. 6-14), suggest a framework integrating the interrelated concepts of social responsibility and sustainability for achieving a sustainability goal and further relate it to the food industry sector.
2.1. CSR, Ethics and Profits Intertwined
Frederick (1986, 1994 cited in Moir, 2001) portrays a sequence of three CSR eras: the first two eras reflect the transition from an initial philosophical approach (social betterment) to one focusing on the corporate capacity for managerial action (corporate social responsiveness to social pressures); the 3rd CSR era is seen as relating to ethically inspired corporate decision making (corporate social rectitude). The following definitions illustrate thatСSR is regarded to benefit both, the companies and society. Lantos’ (2001, p. 600) states that CSR is the “organization’s obligation to maximize its positive impact and minimize its negative effects in being a contributing member to society, with concern for society’s long-term needs and wants”. Dubbed by Elkington (1997), the triple bottom line (TBL) aims to measure corporate performance going beyond the common profit measures (Connolly, 2002; Slaper& Hall, 2011). TBL incorporates three performance indicators: social, ecological (or environmental) and financial. In essence, TBL measures “the impact of an organisation’s activities on the world” (Savitz, 2006, p. xiii). Accordingly, Porter and Kramer (2011) suggest that societal issues should be targeted by business core objectives and should not be seen as a peripheral additional value. They call for a more advanced stage of social responsibility in terms of Creating Shared Value (CSV). In a nutshell, CSV creates economic value by combining the achievement of corporate needs with creating value for the society. This is supported by Robins (2008, p. 331) stating that “yet a growing number of voices in contemporary society, especially in the more prosperous economies of the world, are calling on business to contribute more than at present to general public and social welfare”.
Relating more specifically to corporate and internal effects, Holme (2010, p. 185) believes that “there is plenty of evidence that CSR activities can be beneficial for businesses and not for profit organizations even if carried out for compliance or philanthropic reasons.” This is confirmed by Padmakshi, Platts and Gregory (2009, p. 14) referring to a “misconception of divide between social responsibility and profit maximization”.
A more skeptical view of Smith (2007, p.186) could contribute to and ignite the ongoing discussion even more: “Some obligations are obvious, such as the obligation of the firm to serve the financial interests of shareholders and provide employee satisfaction. But other obligations are not as apparent, such as the firm's obligation to reduce pollution, educate consumers, or consume supplies in a timely manner. All affected parties claim some responsibility of the company, which may conflict with one another.” Masaka (2008, p.17) adds that “genuine show of CSR is actually an illusion in the contemporary business environment. According to this reasoning, contemporary business operations are never inclined towards genuine concern for public interest because it is a good thing to do but simply because they ensure a conducive environment to make profits.”
2.2. CSR – A Strategic Approach
In practice, CSR often consists of non-systematic programs and activities (Nola, in www.ceoforum.com.au/article-detail.cfm?cid=8449; Nielsen and Thompson, 2009, in Spence and Painter-Morland, 2010). However,Galbreath (2009) based on a wide ranging literature review links corporate social responsibility with formal strategic planning in that it requires systematic environmental monitoring, cross-functional co-ordination and integration to successfully meet stakeholder demands and high resource intensity. In the same vein, Misani (2010) calls for socially responsible firms achieving stakeholders’ goodwill and differentiating themselves from other competitors. Accordingly, Husted and Allen (2001) indicate a direct positive relationship between CSR actions and competitive advantage, stating that the “right” CSR strategy is very likely to result in a higher possibility for obtaining competitive advantages.
A strategic approach is also reflected in the development and daily application of a set of rules, in other words, a code of conduct for corporate social responsibility. Crouch (2006, p. 1533) defines the CSR code as “the approach by firms that voluntarily takes account of the externalities produced by their market behavior”.
Bondy et al. (2004) claim there are two main distinct types of CSR codes. An internal one is targeted at management and employees of the organization, and the external one is targeted mainly at external stakeholders such as suppliers, partners and representatives of the society. In this context, in 2000, the United Nations announced the creation of Global Compact. That is a voluntary association guiding corporations on CSR by ten principles relating to human rights, labor, the environment, and non corrupt business conduct. In addition, a creatednetwork of companies, NGOs, labor groups, and UN agencies can share ideas about how to create better corporate citizens(Blair et al, 2004).
2.3. Reasons to Differentiate
Being of considerable national and even global importance, CSR refers to political, economic and social levels with different countries having their differentiated perception on it. For example,according to Silberhorn and Warren’s research (2007),in terms of CSR perspectives, exemplarily, British companies have been found to be more performance-driven in their primary activities, while German companies tend to be more value-and stakeholder-driven. Both, however, rate the performance perspective higher than the value-and stakeholder driven one. A further notable difference, for example, refers to corporate governance, compliance and sponsorship issues. Whereas British companies stronger emphasize corporate governance and compliance issues, German companies seem to put a stronger emphasis on sponsorship.
A further indication for the necessity of differentiating is provided by Baker (2004) comparing the American view on CSR with that of the European one: “In the United States, CSR has been defined much more in terms of a philanthropic model. Companies make profits, unhindered except by fulfilling their duty to pay taxes. Then they donate a certain share of the profits to charitable causes. It is seen as tainting the act for the company to receive any benefit from the giving. The European model is much more focused on operating the core business in a socially responsible way, complemented by investment in communities for solid business case reasons” (Baker, 2004).
According to Crane and Matten (2007) ethical responsibilities are higher on the agenda in European businesses compared to the United States and developing countries.
Visser (2008) defines the main drivers for CSR in developing countries to be internal ones resulting from pressures within the country (cultural tradition, political reform, socio-economic priorities, governance gaps, crisis response, market access) and external globally originated ones (international standardization, investment incentives, stakeholder activism and supply chain).
Referring to the concept of the growth machine in Eastern European transition countries, Kulcsar and Domokos (2005) reason a differentiation as to the Western environment by the socialist legacy, the influence of elite transformation and the strong influence of powerful external actors such as the state or international investors. A further reason for differentiation is provided by Tonoyan (2011) having investigated the East-West corruption gap. The author sees the reasons for corruption in less efficient financial and legal institutions with lacking enforcements, the perception of corruption as a generally existing business practice, and the existence of social networks, which might decrease opportunism.
2.4. A Network Approach
As social entrepreneurs are in business to further social and environmental aims,many opportunities for teaming partnerships between companies, non-governmental organizations (NGOs), not-for-profit organizations, governmental agencies and social entrepreneurs emerged (Menon, 2005). Based on best practice cases in social entrepreneurship, Isaias and Kaufmann (2011) suggest complementing the Triple Bottom Approach with a network structure. This network with governments, municipalities or private companies should facilitate the growth of social entrepreneurship by providing funding, appropriate legislation frameworks, incubation centers and co-operation opportunities. This research is regarded to provide further suggestions for a conceptual underpinning of required network structures.
3. Social entrepreneurs- social capital and equilibrium builders
Regarding a concise summary of the current and emergent schools of traditional entrepreneurship and its contribution to cope with transition situations, it is referred to Kaufmann (2009). Currently, a consensus on a clear or comprehensive definition of social entrepreneurship is urgently required (Martin &Osberg, 2007). This research follows the definition according to which social entrepreneurship aims to solve social problems by innovative solutions in organizational forms targeting either on profit or non-profit or by cross-sector co-operations blending profit and non-for- profit objectives (Paerenson, 2011, referring to Dees, 1998, Austin et al., 2006, Townsend and Hart, 2008; Ashoka, 2011; Skoll, 2011).
This definition reflects a major contribution of social entrepreneurship in terms of creating social capital, i.e. community projects bydesigning the co-operation of people devoted to a common purpose or mission (Fukuyama, 1995, in Thompson, 1999; Thompson, 1999; Thompson, Alvy and Lees, 2000; Grossman, 2008; Kaufmann, 2009; Paerenson, 2011) based on community values (Grossman, 2008). Relating to public management entrepreneurs in business improvement districts, Grossman (2008) found a combination of traditional entrepreneurial characteristics and social capital builders, a view supported by Drayton (US News, 2005) regarding social entrepreneurs as reformers.
Expanding on characteristics, attitudes and personality domains, Van Ryzin et al. (2009, p. 136) found by quantitative research that social entrepreneurs dispose of more social capital, “are happy people, interested in politics, giving to charities, extroverted, and more liberal in their political ideology”. Furthermore, they are described as being innovative, ambitious, persistent, problem solvers rather than transferring problem solution to government or business sectors, and “persuading entire societies to take new leaps” (Ashoka, 2010, p. I in Makhlouf, 2011). Very relevant for the three cases of this research, Martin &Osberg (2007, p. 39) define the social entrepreneur as “someone who targets an unfortunate but stable equilibrium that causes the neglect, marginalization, or suffering of a segment of humanity; who brings to bear on this situation his or her inspiration, direct action, creativity, courage, and fortitude; and who aims for and ultimately affects the establishment of a new stable equilibrium that secures permanent benefit for the targeted group and society at large.” Due to the necessity of mutual trust building, Grossman (2008) calls for transcending the traditional business mindset with strategic community oriented business skills. The previous two suggestions are in line with Thompson’s (1999) and Grossman’s (2008) view thatsocial entrepreneurship imaginatively revitalizes unused community resources to satisfy existing social needs which the welfare system could not meet, for example, due to budget constraints.
Regarding publications on key success factors in social entrepreneurship, Makhlouf (2011) refers to Morral’s (2010) 4 C’s:
Compatibility of product/service and stated corporate purpose
Connection with customers and other stakeholders created by a passion and a mission for the venture
Communication with stakeholders as to capability, reliability in terms of keeping promises, and measurable outcomes
and measurable outcomes
Commitment to persevere in spite of various problems
When it comes to teaching social entrepreneurship, Shockley and Frank (2010, p. 770) suggest
to include many disciplines and organizing units rather than only the business school (Ashcraft, 2008 in Shockley and Frank, 2010)
to focus on a social-moral motivation or social mission, supported by Makhlouf (2011) whereas leadership, vision, drive and opportunism are already demonstrated qualities.
Confirming the social motive of social entrepreneurs, Sundin (2011) additionally introduces the care concept.
These suggestions include but go beyond MacLagan’s (1998, p.2) suggestion that such training is intended "not to convert 'unethical' individuals but rather to help the majority of essentially well-meaning people in organizations appreciate and understand the moral significance of events around them, and to respond appropriately".
The second stage of the research involved the empirical part which is provided in the next chapter.
Derived from the literature review, the following research questions guided the empirical stage:
Is there a genuine care for public concerns or, in other words, is CSR of intrinsic or
Does the CSR and Social Entrepreneurship approach applied in Eastern Europe reflect a
Should social entrepreneurship be differentiated as to Eastern European idiosyncrasies?
Has CSR and Social Entrepreneurship to be taught differently in Eastern Europe?
Do characteristics and competences of social entrepreneurs differ in Eastern Europe?
What are the implications of cross-sectoral partnerships on the effectiveness dimensions
Social Entrepreneurship in Eastern Europe
7. Does Social Entrepreneurship make an impact in Eastern Europe and which criteria for impact assessment can be elicited?
4. Research methodology
The aim of this research is to contribute to shorten the gap in existing literature related to provide empirical evidence and conceptualizations on the effectiveness of social entrepreneurship and its interplay with cross-sectoral partnerships in Eastern European settings.
Based on a constructivist ontological background, the data collection wasconducted applying the qualitative case study research method. According to Tellis (1997), Yin (2002), and Salkind (2006), the case study epitomizes three parts of a qualitative method: describing, understanding and explaining. Salkind (2006, p.205) suggested that case studies “are a unique way of capturing information about human behavior”. Furthermore, he and Yin (2003) provided several reasons for using them: first, it focuses on a person, company or a country; second, it allows several techniques to be applied for gathering the information; third, it is perceived the best way to obtain rich, deep and microscopic information; fourth, compared to a survey method, the researcher has a better control over the research project; fifth, the case study is based on a real life context. Three Eastern European case studies have been explored over a period of 6 years (2006-2011). The case study settings were Hungary, Bosnia and Herzegovina and Croatia.
The research techniques used for the ethnographic qualitative case studies were focus groups (6 members of Ágota and 4 members of Narko-ne) and one group interview (two interviewees of MarijinDvorLužnica). The rationale for using focus group and group interview was that these techniques are regarded as flexible research techniques when listening to people, learn from them, getting rich context specific information and creating a line of communication between all research participants involved(i.e. Evmorfopoulou, 2000 in Wilson, 2009; Salkind, 2009).
Due to the fact that the focus group members could not speak very well German or English, the discussions were held in their mother tongue using interpreters. All terms had been clarified before hand to achieve common understanding and conceptual equivalence.
In the following presentations of the research findings, direct quotes of the participants are provided followed by an (R), meaning respondent and the respondent’s number to care for anonymity. The data were analyzed using content analysis to elicit the main categories and sub-categories.
5. Research findings
The followingintroduction of the respective cases, presents the reader with a description of the major activity of the respective organizations. The case studies reflect that philanthropic initiatives of social entrepreneurs can change state systems to the very, i.e. budgetary, benefit of these systems and the marginalized people in question. The cases mirror a very high level of dedication, commitment, empathy and passion, past experience and know how in the field, methodological competence, business administration, i.e. planning and marketing skills as well as the ability to successfully lobby the activities with political decision makers. This is culminating in Civil Society Organizations actually taking responsibilities, which initially were those of the state systems. Initial initiatives in this way, can experience national and even international radiation of the ideas and concepts.
5.1. Results of Participant Observation
Case Study 1:Ágota Foundation – Reform of the State’s Child and Youth Care in Hungary.
The Ágota Foundation was created in December 1996 with the general objective to improve the situation of marginalised children and youth in Hungary, especially of children which were brought up in the state’s child care system. The founder’s JánosKothencz’ motivation was seeded in his own life experience having been growing up in the state’s children homes.
He started to build a wide net of volunteers who cared for the kids one by one and organised annual summer camps for children living in state’s child care institutions all over Hungary. The foundation opened the Children and Youth Centre in the social hot spot of Szeged where the foundation is seated. The thought behind this initiative is that prevention is better than healing. The main services provided ranged from various leisure time activities, hot meals, health education, private lessons, drug prevention and crisis intervention. The most important aim is to dedicate attention to every child, as well as to their mothers, fathers and teachers.
The values, that every child deserves to be loved and to be prepared for her/his future, were shared by the rapidly growing team members of volunteers. But nevertheless, the leading team was aware that the foundation’s single activities would not change the child care system and that concerted action was required.
When Hungary accessed to the European Union in 2004, the building norms for the children homes were changed with every child getting some own space and the material base getting much better in the children homes. However, the pedagogical work still did not differ too much from the old communist measures which had not sufficiently respected the children’s dignity and had not strengthened their personalities for a self-responsible and successful live management when becoming adults.
The Ágota’s research project’s results presented in 2006 showed the entire disaster of social exclusion: Most of the children leaving the state’s child care institutions became long life clients for social state care. They had no self-esteem or resilience, had very low education levels - mostly incomplete school or vocational training. Criminality and aggression belonged to their every day life. The very high number of Romaamong them, being drawn from their families, missed cultural identity. The children’s future dreams about a secure and trustful family life remained unfulfilled, but many unwished babies were born. Last but not least, the children of the state’s child care system were stigmatised by the Hungarian society.
The staff in the children homes very often had no or too little pedagogical know-how and experience. In fact, education in the sense of enabling or empowering someone did not take place in the children homes. Although it was already forbidden by law, many children were still beaten and locked up. The personnel had no motivation for or satisfaction of their work. Therefore, the personnel’s fluctuation was very high and the children missed caring persons or psychological parents.
Facing these research results, the Ágota foundation decided to change the situation in a long-term process, going step by step, but in a sustainable way. The biggest challenge was to raise confidence inside the child care system, in the children homes of 10 governmental regions (Komitate), and as well as in their supervising institutions (Tergyesz). The Ágota team started a pilot project (2006-2009) with test groups from children homes which already participated in the summer camps. As a result, they developed the new pedagogic-therapeutic method KÁSZPEM ® , which was finally registered as the intellectual property and accredited by the Ministry of Education as training courses for professionals working in the state’s child care system. For the accreditation the implementation of the quality management system was obligatory.
From this moment, the organisational structures started to differentiate and to grow. The work places were defined, the hierarchy established and the separated volunteers’ network was founded. Ágota applied for subsidised personnel at the labour office in Szeged.
As a next step, the Ágota Adult Education Institution was founded as a special-purpose commercial activity. From its profits the foundation is benefitting and financing its core activities like summer camps and youth centre. A business plan was made to forecast and control the whole Ágota budget. Nowadays, the financial aim, to build an own financial source of income, is reached although not all the Komitate are included yet.
By extraordinary press and media work, the Ágota Foundation became famous in Hungary. The social entrepreneur JánósKothencz was speaking in the Hungarian Parliament received some high honours, and an awarded documentary movie about his life experience and mission was presented in the Hungarian cinemas. In 2011, the “National Conference on the State’s Child Care System” was organized in Szeged with the Hungarian President Dr. Schmitt Pál as speaker.
The high publicity contributed to a mind change in the Hungarian society. On top, now it became possible what already was usual in other European countries: In accordance to the subsidiary principle, Ágota as civil society organisation (CSO) takes responsibility for state duties of child care and child protection. When the Ágota team got encouraged for this task at the FICE Conference (FICE= International Federation of Educative Communities) in Helsinki 2008, it represented a new beginning, but the achievement seemed very far away yet.
However, already in 2010, the St. Ágota Foundation for Child Protection was founded, and is now undertaking by contract some services which were originally duties of the Tergyesz’s like supervision of the children homes, further education of the educators and social workers and others. Currently, Janos is the supervisor of around 500 professionals in the child care system of two Komitate, other regions will follow.
Due to many requests, currently, Ágota is planning to go international. JánosKothensz wants to sell the KÁSZPEM® Training Courses in Bulgaria, Romania and in the Ukraine. The target remains the same: changing the state’s child care system to save the children.
Case Study 2: Narko-ne Asscociation – Prevention of Addiction in Bosnia and Herzegovina
In 2001, Sr. Madeleine Schildknecht TOR, the Franciscan nun from Switzerland came to Bosnia with the intention to contribute to the peace making and reconciliation process in the post war society of Bosnia and Herzegovina (BiH).
After the war in Bosnia and Herzegovina the problem of drug abuse was urgent but political stakeholders tried to ignore it. Neither in the national youth report nor in the EU reports the topic was mentioned. When Sr. Madeleine came to Banja Luka, at first she got acquainted with the sisters of the Holy Blood who just have been establishing the therapeutic community in their former Monastery of Alexandrovac. This experience was the starting point to think about addiction, therapy as well about the complementary services.
After the fact finding phase, the positioning was made in the field of primary and secondary prevention of addiction where the concept of “Salutogenese” is focused on by strengthening the resilience factors (Buessers, 2009, referring to Aaron Antonovsky’s research). In 2001, Narko-ne was founded in Sarajevo under the umbrella of the existing Franciscan welfare organisation “Bred of St. Anthony” what gave the new CSO certain security and recognition from the very beginning. Nevertheless, Sr. Madeleine became director of Narko-ne and the organisation became the own independent brand.
The organisational development was less driven by strategies, but more by carrying out various projects. The first volunteers were committed to the pilot projects “Droga-tel” and “Peer group education” in schools. The first important steps for building the wider professional network was the further education of social workers and psychologists working in youth work in various cities of BiH. The intercultural creative summer weeks (IKS), annually held together with Swiss art students in small cities in Middle Bosnia, are already celebrating their 10 years anniversary in 2011, and are presented in the very interesting jubilee video about its history and local impacts on the multi-ethnic communities. The other important long-term ongoing projects are the “Intercity Theatre”; the pupils’ journal “Preventeen”; and, finally, the student volunteering project “Older brother, older Sister” for social inclusion of children being registered at the governmental social centres.
The steadily growing net of volunteers is the conditio sine qua non for all Narko-Ne project work. The main projects’ have their own logos, their own supporting local and international stakeholders which also renders an advantage to the organisational brand of Narko-ne.
Most of the projects were supported by know-how transfer from abroad by foreign lecturers and supervisors or by hospitation travels. Therefore, today Narko-ne is acknowledged as representing a form of specialised social entrepreneurship in the field of prevention of addiction, still being the only one and having a profound theoretical and practical background. Further education is a prerequisite for the Narko-ne personnel and volunteers. Clear defined objectives and work plans as well as published quality standards underline the professional standards.
The expertise of Narko-ne is asked for by donors and policy makers in the field of health or youth, alike. However, the social entrepreneurship is selective with becoming a member in networks. Sr. Madeleine focuses on the core mission and only joins networks when also Narko-ne may benefit from results or impacts or/ and when Narko-ne can significantly contribute. Selected networks with international mentors involved are: TheNGO Council, the Coalition for Fair Education, the Anna Lindh Foundation and the CIDI project (Policy Dialogue for All Project). Selected networks on a local level are: Justice Network (Mrežapravde); Agreement plus (Sporazum plus); Network Volunteer Diary (Volonterskidnevnik); Peace building network (Mrežaizgradnjemira).
The biggest challenge for Narko-Ne has been the team changes which are naturally occurring when inviting young professionals who are just starting their careers. In this situation, Narko-ne had to be very flexible, and it is still very difficult to build the middle management which undertakes duties like project development and acquiring funds. Sr. Madeleine tries to see the bright side: She sees the advantage of this situation for Narko-ne in being always up-dated to the needs of young people, and a well-known and popular employer. But, an important open strategic question remains: who will be her successor when she will go in pension in some years? Or are there any promising growth strategies to bring Narko-ne and its projects onto the next future level of its development?
Case Study 3:MarijinDvorLužnica - Informal Adult Education in Croatia
In 1925, the Zagreb Province of the Sister of Charity of the Holy Vinzenz von Paul bought the baroque Castle of Lužnica including park and forests which they used as a home for the aged nuns. During socialist times, the property was confiscated, and only after the political change the nuns received it back.
Soon, it became obvious that the use of the castle as a home for the aged nuns was not possible any longer due to lacking hygienic, damaged heating, and so on. After a storm had damaged the castle’s roof, the community was contemplating a new purpose respecting the nuns’ charisma (social-caritative or educational missions) and supporting the local people. The nuns felt highly responsible for the cultural heritage.
After consultation, the nuns decided to establish the first Informal Adult Education House / Spiritual Centre of its kind in Croatia. The preparation has been taking six years, entailing the following works:
Construction (renovating and rebuilding the castle with regard to monument protection including conference hall, seminar rooms, dining rooms and professional kitchen; construction of the new guest house including an architectural concept with 60 bedrooms and separated nuns’ enclosure; and reconstruction of the park according to the baroque plans)
Conception (development of the education concept with four contextual pillars: religious education, ecological education, social and political education as well as cultural education)
Further education of the nuns in hotel management including e.g. leadership, HR management, process management, marketing, finance, bookkeeping) and in adult education (programmes, methodology, didactics)
Preparing the first year’s education programme
Preparing the business plan with the following revenue mix: booked seminars of the annual programmes, occupancies with own programmes, room rents without accommodation, exhibitions and presentations on other cultural events and charity concepts, castle’s guidance, shop of monastery goods, café,…Revenues could also be generated by selling land to an interested company
Preparing the registration. The public law institution could be only established after enacting the law of adult education in Croatia in 2007.
Construction, learning as well as fundraising that addressed public institutions, private donors and local companies had to go hand in hand.
The director, Sr. Miroslava Bradica and her team, that also changed from time to time, had to stand a lot of uncertainty and also to go through internal and external struggles before, in 2007, the opening of MarijinDvorLužnica could be celebrated. This was hard because after socialism the nuns were not attributed such a social entrepreneurial role, neither by the church nor by the society.
Moreover, the nuns did not have a pattern for their project development in their own country. hospitation visits abroad gave them some ideas about informal education houses or about the reconstruction of historical buildings, but the adaptation to the own, very much differing situation, was far from being easy. Overall, the project success was empowering the nuns in what they were doing and gave them self-esteem.
The Open Day with various programmes for all interested people was visited by more than 1000 people. A press conference was held.
At that time, the main target group were defined as follows: religious groups, CSOs, companies and international groups. Reflecting on learning by doing, the target groups were shaped more precisely: senior groups and local and international, cultural and religious tourist groups. The share of companies using the facilities for conferences or presentations was also continuously increasing.
The problem the nuns are facing until today is related to the status as an education house which is different from the hotel business with other taxation and regulation rules. In this context, they face a restriction regarding accommodation without programmes whereas for the guidance in the castle Sr. BerislavaGrabovac attended a course and got the licence. Summarizing, the entire business runs perfectly: In 2010, the nuns had their capacities nearly fully booked and, finally, the biggest future threat is also prevented: the planned highway will not run next to the Lužnica castle. After many visits and letters to public decision makers it will run down another way. The silence, nature and unique characteristics of the location could be saved.
5.2. Results of focus groups and group interview
The following narrative highlights the main emerging categories reflecting the key success factors of the three social entrepreneurship ventures. An emerging conceptualization will be provided after the narrative.
a. Motivation- Recovering from an Identity Crisis: The Human Being, Political System and War, Recovering Human and Christian Values, Cultural Heritage, Personal Life Experience and Faith
In order to start the challenging adventures of “changing the society for better” (R1-R12), specific key motivators existed. The motivators were mainly routed in the affection to the human being and/or experienced shock due to the detrimental consequences of political influences. As mentioned by several respondents (R7, R8, R9, R10), it was the war in BiH, which thrilled the need to take action and responsibility in their societies to change the situation. As reported by R11 and R12, the influence of socialism was crucial: “Christian and human values were destroyed in Socialism. The church and religious orders were in the underground” (R11). Hence, the motivators for the Informal Adult Education in Croatia were twofold: The first motivator refers to the recovery of Christian and human values by providing the old nuns living there in bad conditions with a dignified living surrounding and the second motivator to preserving cultural heritage. The castle where the nuns were living was expropriated, and therefore, so R 12 said that “we were longing for a place of peace, the location for encounter, also for the youth. Men needed a place to find themselves after Communism and war in some parts of our country”. A different motivator drove (R1) to initiate this project: “it was based on my own life experience, I found enthusiastic people joining me”.
For all the members of the Ágota foundation the opportunity to reform the child state care system in Hungary to the benefit of every child was the most salient motivator. The members of Narko-ne wanted to contribute to the peace making and reconciliation process in Bosnia and Herzegovina, social inclusion and addiction prevention.
The final motivator, which is the common denominator for all three projects, was faith. Exemplarily, R2 stressed that “faith belongs to the community so that we are always committed to our vision and mission. This is not restricted to working hours but expands to life and also to faith”. For R7 faith was supportive “for respecting different believes” and for R12 faith was an obvious motivator due to “the nuns being the management team”.
b. Volunteers’ Commitment
The very high level of commitment is underpinned by the very high number of volunteers as already indicated by the previous factor. Importantly, the commitment is lived by all the volunteers who carry through the projects. R3 highlights that “Ágota volunteers have their own identity, being engaged, and smart, enthusiastic and a bit crazy”. In the same vein, R9 of Narko-ne comments: “100% focus is on the volunteers, every project has own teams of volunteers”. Regarding the MarijinDvorLužnica project, there are “the alumni’s networks of volunteers (Internet based social network)” (R12) who carry all the work. For R11 it is clear that in this type of organization “it needs much more higher commitment than in other institutions”. She further explained “that it is not a normal work place, it is a mission”.
c. Management- An Ambivalent Stance to Strategy
The management of the projects embraced issues like having objectives in place indicated by R5: “everything starts from the top, without clear objectives there are no results”. Objectives are followed by strategic development as mentioned by R10: “in 2006 we made our strategic plan. It gave us the important directions, but we considered it as more important than it turned out to be in practice”. On the other hand, all three respondents underlined the importance having the defined mission and visions and as well conscious value proposition that volunteers and employees share alike (R1-R12).
Other managerial activities referred to processdescription, reflection on practice, change management, quality management systems e.g. “for accreditation stressed by R2, or “for defined quality standards as highlighted by R8 or project management including learning of how to apply for projects. A common emphasis of all respondents regarding the methodology was put on “learning by doing”.
The importance of quality management closely related to the factor of ‘organizational development to be described later was highlighted by several respondents. R5 commented that “the implementation of the monitoring system was an important milestone; we defined objectives, success indicators and methods for observation”. The necessity to implement a quality system was commonly agreed upon by the three organizations. Accordingly, R6 it was needed for the accreditation process, it is applied in the management system, but not consciously on a daily basis but it should not be a point for further discussions at the moment. For R9 it is an issue which helps in gaining credibility: “it was important in the “Older brother, Older sister programme. The QM handbook gives us credibility from the international donors”. Finally, in the Lužnica case, this quality management system is used for “getting regular feedbacks from visitors and participants and prepared feedback sheets (R12).
d. Leadership- specifically of volunteers
The leader’s personality and charisma turned out to play a paramount role. In the case of Narko-Ne, the option of loosing their leader due to retirement may cause difficulties for the organization calling for sustainable leadership. R9 drew attention to this important issue by regretting that “in about five years Sr. Magdalena will retire; Narko-Ne is searching for solutions, either to survive as organization with new leadership or distributing the core programmes to other youth organisations / social organisations. In the case of Ágota, leadership had to be learned as explained by R4: “atthe beginning, we were just a group of volunteers; we had to professionally familiarize with hierarchical structures and leadership. This was not an easy step”. Nevertheless, after passage of some time, “today, we are a professional organization where the group of volunteers have their own important space; currently, the volunteers have grown their own small organisation, with own leadership inside of Ágota. They are still the base of our work” (R6).
In terms of leadership development, R11 indicated that “the nuns studied or have been trained in economics, law, education, marketing and tourism”.
e. Idiosyncratic Skills and Attitudes
In these challenging projects, special skills and abilities are required for their implementation. The following skills and attitudes have been agreed upon by all the respondents: learning by doing, power of endurance and frustration tolerance, flexibility and openness for change, cross-cultural communication, conflict solving and the ability to ‘fight’ (R1-R12).
f. Attracting Financial Resources- Balancing with Independence
A crucial issue in these projects proved to be the attraction of financial resources. Continuous financing had to be assured by one or a few private donors, for example, Renovabis from Germany, supporting the Hungarian and Croatian projects or Renovabis and international church institutions and organisations supporting Narko-ne. Another option is public funding. In the case of Ágota, R3 complained that “we had established the good public fundraising, but the amount of funds is steadily reducing”. Concordantly, R10 of Narko-ne added: “we have steady public funding of 5%; we do not see that this is changing soon”. A more optimistic view is expressed by R11 fromMarijinDvorLužnica: “we have good chances to receive public funds due to our legal form”.
An interesting observation was made as to the respondents’ views on staying independent to donor’s policies. In this context, R8 mentioned that “the strategic approach of addiction prevention is defined widely so that Narko-ne fits into many programmes or can easily adapt to them without loosing the key competence. We never had debts which are the temptation to do everything and not to keep the focus”. In the case of MarijinDvorLužnica the situation is different, since they can already financially maintain themselves. In the case of Ágota, they explained that “we are working strategically on financial independence, which most probably will be reached in 1-2 years as stressed by R6.
g. Organizational Development
As first initial step to the organizational development all three social entrepreneurship ventures stated that the registration and receiving the legal form was very important. “Due to administrative requirements that was not an easy step” (R12). And R5 of Ágota pointed out that “legal advice was essential to various stage of our organizational development”.
In relation to the overall organizational development, R2 indicated that short term lines for strategic guidelines allow them to keep flexible, whereas, on the other hand, long term time lines for strategy guidelines are considered “very important for being able to design the changes” (R5).
Due to the very transitional macro environment, R3 highlighted that “change management is constantly necessary”. Referring as well to the organizational development is the issue of cooperation and networking which is rising in importance. Although Ágota and Narko-ne are aware of the potential benefits of networks and co- operations, both organizations are very careful in terms of selecting their business partners as indicated by R1: “We carefully select our partners. We can loose time and our good image when co-operating with the wrong partners. We concentrate on the "real" work compared to many CSO and networks having little or no results”. The criteria for partner selection for Narko-ne are “to select some local and international ones where we are active and hope to have influence on policy making for our own benefit later on” (R8). Furthermore, they differentiate as to “the civil sector, where some CSOs should concentrate on advocacy, others on their key activities. Just networking and working on meta-structures is inefficient” (R10).
h. Marketing- Traditional and Lobbying
The positioning, a strategic marketing aspect, of the three projects has three factors in common: being unique, being first in the social market and choosing the right location. During the findings' analysis stage, the enthusiasm perceived by the respondents regarding themselves as pioneers in the field was very prominent. Similar statements sharing this pride of being a pioneer could be perceived. R7 stressed that “we are unique, we are first and it was important to go to Sarajevo". This statement is in line with that of R3: "being unique and being first in the social market". Similarly, R12 confirmed these views: "we are unique in Croatia; we are first and have calm and the outstanding location (the castle and the park).
As already indicated by the previous summary of the three case studies, Marketing, especially the marketing-mix, had been considerably applied. Commonly agreed upon by the members of the three projects were the use of homepages, internet based social networks, e.g. “we have alumni networks” indicated (R12). Flyers and brochures, fairs, open conferences, public events, e.g.” Yearly Narko-ne Day, Yearly International Volunteering Day, Some Conferences in the “Older Brother, Older Sister” Programme (which are considered as milestones in the Narko-ne development)” (R7). Referring to advertising, R 11 referred to press and media work: “very important for us is to be in TV, e. g. tourism broadcasts, morning magazines, articles in journal of Croatian airlines; we have our media manager”.
Implying the importance of Customer Relationship Marketing and Internal Marketing, R8 of Narko-ne emphasized: “Because the media allow themselves to be taken by political interest, we are more cautious with marketing via media and are instead mainly focusing on “Human networking”. Through our own “Preventeen” journal we are constantly visible in our main target group; the internal marketing is stronger than the outside”.
In addition, political lobbying is considerably used as a marketing tool in the three projects. The way Ágota uses political lobbying is outlined by R2: “speeches in the Hungarian Parliament, member of youth councils, National Ágota Conference 2011 with presence of the Hungarian president, various ministries and stakeholders of the child care system”. In the case of Lužnica, political lobbying “was needed to get our land and real estate back as a base for new projects (school, kindergarden, MarijinDvorLuznica) indicated (R11). Lužnica was seriously endangered by the construction of the new close-by highway. The writing of more than 200 letters, holdings of many meetings with decision makers and stakeholder proved to be successful. Currently, the highway takes another route. A different view is taken by Narko-ne trying “to avoid political contacts and to stay neutral, but for public conferences we invite selected people from the political and administrative scene to involve them into our discussions” (R10). They are involved in networks, mouth to mouth propaganda from reliable and engaged people. R8 adds: “we also take part in the EU CIDI project (Policy Dialogue for All) as well as in the “Sporazum Plus Network” (the “Network Agreement Plus” will implement its activities through topical public forums, advocacy campaigns and other formsof democratic expression of opinions and joint actions of the civil society organizations).
i. External Support: Coaching & Consulting Catalysts in the Initial Stage
As external support, consulting and coaching companies co-operated in the three projects. The contribution of consulting and coaching was perceived by R1 as“important to have impulses and reflection from outside”. Concordantly, R2 confirmed that “we were pushed in some directions where we were still hesitating to go; but it turned out that it was the right way, and we accelerated the entire development, e.g. when integrating the educators to the pilot projects”. A further contribution of the consulting co-operators was highlighted by R4: “consulting helped us to differentiate the tasks and share it in the team and further to build professional structures”.
Coaching and consulting expand their field of activities in the area of multicultural teams as referred to by R8: “consulting and coaching is always very, very important for the multi-ethnic team to get the view from outside. Up to 2006, we mostly had consultants from abroad (Germany, Switzerland). Now, we also have some local consultancies of good quality, and we invite them to work with us. We are satisfied with them. We also co-operate with the EU Tasco project that gives us many impulses (Tasco = The Technical Assistance for Civil Society Organisations). Finally, for R11 and R12, Consulting/ Coaching were very important at the initial stage in the meantime they are learning by doing.
j. Cross- Sectoral Co-operation
The final success factor is dedicated to the cross-sectoral co-operation. Many different institutions were contributing to the success of these projects. To start with, there is co-operation with church institutions. (R3) specifies “dioceses and parishes, contacts to single priests, receiving strong support from the local bishop and having Renovabis as donor”. R7 further comments in this respect: “for us the inter-religious council is important. Other church institutions are sometimes too close to political parties, and they have a nationalistic attitude”. On the other hand, the main donors are coming from international church organisations (e.g. Renovabis, Caritas, parishes). Further cross-sectoral co-operations relate to public administrations and governmental organisations. R2 mentions different public entities which provided an enriching experience for the project members: “we have learned a lot from the public sector and have now a lot of contributions from this sector”. Amongst the public entities are municipalities, local offices, family help centres, various ministries (all for child care and fundraising), accreditation office (for programmes and institutional accreditation), centre of employment (for applying for new staff with funded salaries). Co-operation with industry representatives and SMEs are “mainly for funding or in-kind funding, e.g. the summer camp, playhouse, publications 10% to 20% of the action budget. The private sector is very sensitive and open to our needs and problems”, explained (R6). R10 confirms the contribution in kind.
R1 expressed his concern related to these co-operations with Civil Society actors: “we are cautious with too many co-operations. Many NGOs do not really work, but get funds (corruption). We also avoid tender consortia in order to not get in danger to cheat. We co-operated with just two foundations and the Roma Agency, and we are the formal member of KIFE, which is the relict of former times”. Due to this precaution and lack of trust, R4 stressed that “the biggest challenge was building confidence with the public sector. In the public sector, there is the very high bureaucracy for fighting corruption. It blocks us a lot”. In line with this criticism, R9 added “the public sector is strictly hierarchical. The work places get inherited which encourages laziness, but in all sectors you also find highly motivated people”.
Exemplifying an advantage in the cooperation with the civil society it was mentioned that “Bred of St. Anthony is important because they are helpful in fundraising and they are close to the people; during our co-operation they changed, now they also employ, as a catholic organization, Muslims and employed some of our students”(R7).
For R11 and R12, there is no doubt regarding the importance of these co-operations. They highlighted that “without cooperation in all sectors we do not survive. It is our daily life. May be there are differences or even difficulties, but we are not focusing on them. We have to work together and we do. It is simply a necessity”.
The following figure 1 conceptualizes the categories elicited by the content analysis representing the key success factors of the social entrepreneurship projects in Eastern Europe.
6. Research questions and derived recommendation
Referring to research question 1, the statements in various paragraphs clearly underline that CSR and social entrepreneurship as to the three cases was strongly intrinsically rather than instrumentally driven.
Referring to research question 2, ambiguous results could be found. Whereas vision, mission, objectives and strategies (i.e. change or quality management) seem to be generally appreciated, some statements imply a stronger emphasis on operations. This might be explained by a lack of existing knowledge structures, knowledge ‘road maps’, and experience. It is suggested that more strategic approaches resulting from the reflection on previous experience could usefully inform further projects. In terms of Marketing, growth or competitive strategies were not mentioned by the interviewees and could be a promising route to follow.
Regarding research question 3, it is suggested that social entrepreneurship has to be differentiated due to an apparent identity crisis (Kaufmann, Zagorac, Sanchez, 2008) reflected, for example, by a loss of values and social identity roles of certain segments of society. This implies that new value systems have to be created or new societal roles to be accepted. The role of the media being still used for political influence is also seen a reason for differentiation. This finding has direct connotations with and implications on research questions 4 and 5. Tonoyan’s (2011) corruption related findings were confirmed by this research and, additionally, call for differentiating social entrepreneurship as to Eastern European conditions.
Regarding research question 4 on training & development, Ashcrafts, Makhlouf’s, Sundin’s and MacLagan’s views, as provided in the literature review, were confirmed by the research. It is suggested to focus on management and leadership for the middle management relating to project management, international teamwork, career planning, leading intrinsically motivated volunteers, fund application, importance of legal form for organizational development, strategy development, organizational hierarchies. Whereas transformational leadership focusing on visions, values and empowerment seems to reap very good results in terms of commitment, also instrumental leadership (i.e. in terms of strategy development) is recommended. For social entrepreneurs from non-entrepreneurship or non- management background a more comprehensive and basic education and training in all management and leadership roles is suggested. Regarding the teaching and training methodology, a more inductive rather than deductive approach is suggested due to the often mentioned emphasis on ‘learning by doing’ and a lack of existing knowledge structures.
With respect to question 5 on differentiated characteristics for Eastern European social entrepreneurs, a social- charitative feature, perceiving an educational mission as well as charisma can be mentioned Other characteristics and competences to be differentiated refer to ‘learning by doing’, frustration tolerance, cultural communication, conflict solving, lobbying, and pioneering. Further aspects refer to the ability to attract resources, both financial as well as good will and commitment, is suggested by the findings. The strive for continuous independence of social entrepreneurs in Eastern Europe is a commonality they share with traditional entrepreneurs. Latter aspect could be phrased as a very interesting leadership competence as to start a social movement.
Research question 6 was referred to in the paragraph on cross-sectoral co-operation. As a positive implication, the influence of church institutions, both as entrepreneurs and donators was highlighted. Positive implications were also attributed to the public sector, which was perceived as sensitive to social entrepreneurs’ needs and providing supportive experience being even crucial for the social entrepreneurs’ survival. The co-operation with the industry and SMEs referred mainly to funding and in-kind funding. The view towards the civil societies was ambiguous with negative implications referring to corruption and implicit high bureaucracy requiring the generation of mutual trust and selective choice of networks. From this finding, which points to a ‘bottle neck’ of cross- sectoral co-operation, it is recommended to expand training and teaching activities on the civil society actors as well. Ideally, an objective and multidisciplinary education provider, i.e. university, is recommended to inform, manage and train all partners involved in the cross- sectoral co-operation relating also to research question 4.
Regarding the assessment of impact factors of social entrepreneurship (research question 7), the findings entailed the following suggestions for measuring the impact of social entrepreneurship in Eastern Europe:
change of organizational and social structures on a local level
improvement of individualized care for the respective marginalized human segments
pioneering initiatives materializing new ‘off springs’
creation of new concerted actions with various societal stakeholders
creation of reforms accompanied by innovative educational and pedagogical approaches leading to more sustainable outcomes
creation of intellectual property to be publicly accredited
raise of profits to self-sustain the projects
achievement of perception, acceptance and participation of national and international stakeholders
sustainability of newly created projects
creation of new professional benchmarks
preservation of cultural heritage
creation and ‘healing’ of social identity roles for segments previously suffering from an identity crisis
customers’ acceptance of newly created services
making a contribution to national political objectives (i.e. tourism or adult education)
Starting and sustaining a social movement
Based on three qualitatively researched case studies on marginalized human groups in Hungary, Bosnia and Herzegovina and Croatia, this research provides the key success factors for and suggests factors to assess the impact of social entrepreneurship and cross-sectoral co-operation in Eastern European settings. Whereas, Morral’s (2010) model on key success factors seems to be generally confirmed, a more detailed differentiation of all the four variables as to Eastern European idiosyncrasies is suggested. A commonality, however, was found regarding the general categories of motivation, marketing (in terms of communication) and leadership (in terms of commitment). As to Morral’s variable of ‘connection’ and Kaufmann’s, Davies’, and Schmidt’s (1994) variable of ‘synergy experience’, a differentiation of the conceptualization in an Eastern European context as to volunteers, external support and cross-sectoral co-operation is urgently recommended. Additionally, the variables of management, idiosyncratic skills and attributes, attracting financial resources and organizational development have been found to be relevant in Eastern European social entrepreneurship. The necessity to differentiate conceptualizations in the field is also due an identity crisis which social entrepreneurship seems to able to overcome. Innovative contributions also refer to newly provided characteristics of social entrepreneurships and differentiated teaching and training content and methodologies. To make the overall cross-sectoral partnership process more smooth and trusting, it is recommended to include an education provider from the meta level (i.e. university) to act as a multidisciplinary catalyst for this urgently required construct and to improve effectiveness and efficiency levels even more.