Empirical analysis of social impacts of a rural social enterprise: insights for local and regional development
In developing countries the most marginalised and disadvantaged people are in rural, remote and regional areas and social enterprises in these areas – rural social enterprises (RSEs) – have been identified as key development actors in this context. However, their impacts are rarely rigorously measured. Our study fills this gap by measuring an RSE’s social impact in a developing country. A smallholder farmers’ survey (n = 1021) is utilised in a propensity score-based method which allowed us to generate counterfactual and estimate outcomes between members and non-members of an RSE. This method was complemented by a stakeholder focus group discussion. Predictors of participation and social impacts of the RSE are identified besides an evaluation of its interventions. Results generate implications for social enterprise practitioners, supporters and policymakers interested in applying RSEs as local and regional development actors as well as researchers involved in social impact measurement.
Rural Social Enterprises’ Performance Improvement: An Assessment of their Social Impact Measurement and Critical Success Factors’ Interrelationships with Performance. Implications for Practice and Research
The field of social entrepreneurship has a limited focus on rural areas, and on developing countries. This particularly applies to the study of Social Enterprises (SEs) that address rural areas (RSEs). Rural areas are disproportionately affected by intractable challenges such as poverty and inequality. In addition, they suffer from significant organisational management challenges, which constrain management and performance of enterprises including SEs generally and RSEs in particular.
Analysis and reporting of the performance of SEs, including RSEs, has been criticised as lacking in rigour. A theme of positive, favourable narratives based on an appeal to universally applauded values has provoked commentators and scholars to advocate critical and rigorous analysis. Analysis of the performance of SEs, including RSEs, is dominated by qualitative methods. There are calls for quantitative and theory driven management research to project SEs' outcomes and enable generalised approaches to improving their performance.
In response to these needs, this PhD's overall objective is to advance empirical analysis of the performance of SEs for improved Social Enterprise management, operation, and impact. Three specific objectives are targeted: 1) to evaluate RSE performance measurement methods" 2) to conduct an empirical evaluation of an RSE's performance" and 3) to identify and assess Critical Success Factors (CSFs) that influence RSE performance. Achieving these objectives is documented in six separate but interrelated manuscripts: the first three contribute to achieving objectives 1 and 2 while the remainder enable the achievement of objective 3. Both secondary information and primary data were used. Several analytical techniques were applied. Qualitative data were analysed using Content Analysis, while quantitative data were addressed by Propensity Score Matching, network-Data Envelopment Analysis, Structural Equation Modelling and Importance-Performance Map analysis.
First, a systematic literature review comprising 21 RSE studies with 26 RSE cases was conducted. It is the first review, to the author's knowledge, to focus on RSEs' social impact measurement methods" and this complements existing systematic literature review research on SEs. Second, based on the findings of the review, data were collected in rural Uganda: a case of a developing country with a large marginalised rural population. This employed a random sample (n=1021) of smallholder farmers who are both beneficiaries and nonbeneficiaries of RSEs, complemented by a focus group discussion with community leaders and RSEs' beneficiaries. This provided the basis for an analysis of the RSE's impact.
The identification of RSEs' CSFs drew first on mainstream business and management literature and limited available SE research, then proceeded to a case study comprising semistructured interviews with managers of six purposively selected RSEs. This was complemented by focus group discussions with three purposively selected RSEs in which RSE beneficiaries and community leaders were also engaged in the identification of CSFs. Based on the foregoing, a survey of 521 RSEs was then conducted to assess relationships between CSFs and RSEs' performance.
The results of the systematic literature review revealed that the literature on social impact measurement of RSEs is sparse and relatively new. It confirmed that it is dominated by case studies and qualitative analysis. A variety of definitions of social impact are featured, which together with an apparent lack of rigour and attribution of impacts, limits the usefulness of the available analysis to RSE managers. The literature is also overwhelmingly positive about the impact of RSEs, despite little use of objective comparison methods.
The household survey results are used to identify predictors of RSE participation, and of positive social impacts of the RSE's interventions on smallholder farmers' wellbeing. Quantitative analysis of the household survey results further reveals differences in the wellbeing of the RSE's beneficiaries in that females' and youths' wellbeing are high as compared to those of males. These differences are not easily detected at an aggregate level, and so beneficiaries are revealed to be not a homogenous group. This leads us to advocate diversity/class analysis approaches and a diversity/inclusion perspective, to enable finegrained understanding of the relationship between RSEs' performance and impact on beneficiaries. Qualitative evaluation of the interventions reveals aspects of the RSE's interventions that require attention for achieving and sustaining social impacts.
The interviews with managers, and the focus group discussions, identified a total of 40 CSFs, categorised as internal and external. Based on the relevance/manageability matrix, eight internal CSF general element categories were identified, and priorities for managers' action assigned. The survey of 521 RSEs revealed interesting findings on two fronts: first on the interrelationships amongst internal CSFs (entrepreneurial orientation, social salience and business planning), and RSEs' financial and social performance)" and second on the interrelationships amongst external CSFs (financial support and training support), and internal CSFs (business planning) and RSEs' financial and social performance. For the former relationships, we find that entrepreneurial orientation and business planning are critical to RSEs' performance, and that business planning mediates the relationship between entrepreneurial orientation and financial and social performance. The latter relationships reveal business planning and training support as key influencing CSFs for improving financial and social performance. To the authors' knowledge, this is the first quantitative study to focus on RSEs' CSFs in a developing country, and in the rural context.
This collection of manuscripts contributes to knowledge and methods vital for researchers interested in advancing RSE performance. The manuscripts also offer guidance for RSE practitioners and supporters, and for the makers of policy for developing countries' rural settings. Finally, the manuscripts each advocate future research directions.
Social Enterprises as a Revitalization Strategy for Rural Communities
There is growing academic and practitioner interest in social enterprises (SEs), due to their – mostly assumed – positive social impacts on communities. However, there is less research available on the place-based nature of SEs, such as within the rural context, especially regarding factors that influence their capacity and success in social impact creation. This chapter focuses on the rural context because of the unique challenges that influence service/product provision to rural communities. These issues contribute to rural areas disproportionately facing challenges such as poverty, inequality, and more recently the COVID pandemic and thus lagging metro ones on many indicators.
Discussions in this chapter offer important insights on this issue through a review of 26 Rural Social Enterprise cases from published empirical studies. The analysis identifies factors that influence social impact creation ability in Rural Social Enterprises, categorizes them under a motivation, capability, and opportunity framework as levers for social change, and elaborates how they influence social impact creation ability in the enterprises. These results are important to rural development practitioners, supporters, policymakers, and researchers interested in using Rural Social Enterprises to revitalize rural communities in the post-COVID pandemic era.
Critical Success Factors of Rural Social Enterprises: Insights from a Developing Country Context
Rural social enterprises (RSEs) operate in rural areas, which disproportionately face intractable challenges such as poverty and inequality. They need to identify and develop the factors critical for their success. Data were collected in rural Uganda on a case study basis, using semi-structured interviews and focus group discussions, and analysed with Content Analysis. This identifies 40 factors critical for the success of RSEs. A relevance/manageability matrix reveals eight internal factors that are of central importance for the success of RSEs. These findings advance understanding of RSEs and have important practical applications for such enterprises.
The measurement of social impacts in rural social enterprises: a systematic literature review and future research implications
Rural social enterprises (RSEs) represent an emerging actor in rural and local socio-economic development. The study of RSEs recognizes the importance of place-based actions for development. Social impacts of RSEs have been touted, particularly in filling roles in the rural context that are underperformed by governments and private actors. However, RSEs' social impact measurement remains emerging. This review confirms that measurement of RSEs' social impact, and its attribution to RSEs' interventions, remain underdeveloped and lacking in both rigour and consistency. Solutions are proposed that contribute to improved methodological approaches applicable to rural regions and appropriate for related interventions confronting spatial disparities in rural development.
Interrelationships amongst Critical Success Factors and Rural Social Enterprises’ Performance in a Developing Country Context
Rural social enterprises (RSEs) are an emerging actor that applies market-based approaches to implement a social mission: steering social and economic development. They thus contribute to addressing intractable challenges such as poverty and inequality disproportionately faced in rural areas. However, there is limited empirical evidence of their performance particularly regarding critical success factors (CSFs) and their interdependencies in influencing RSE performance in developing countries' rural contexts. Our study aims to contribute to closing this gap by examining the interrelationships between internal (e.g., business planning) and external (e.g., financial and training supports) critical success factors (CSFs), and the performance of RSEs. The study uses survey data from 521 rural Ugandan RSEs, which is analysed using structural equation modelling and importance performance map analysis. Results show business planning and training support as key influencing CSFs for improving RSE performance. These results offer guidance for improving RSE performance to Ugandan RSE practitioners, supporters and policymakers as well as those in related developing country rural context. The study also provides initial findings valuable to researchers interested in advancing RSE performance.
Livelihoods-conservation initiatives: Evidence of socio-economic impacts from organic honey production in Mwingi, Eastern Kenya
Community-based initiatives with a double objective of improving rural livelihoods and conserving forest resources face the challenge of balancing the two objectives without creating trade-offs. Our study investigates the socio-economic performance of a community-based initiative that uses cooperative-driven organic certification of honey producers in Mwingi, Eastern Kenya, to improve livelihoods and acacia woodland management. Data were collected through a household survey of 303 beekeepers from 38 organic certified and 16 non-certified beekeeper groups. More data were collected using key informant interviews, informal conversations, participant observation, participatory rural appraisal, internal document reviews and secondary sources. The survey included questions regarding beekeepers' livelihood activities, organisation involvement, quantity of honey produced and sold, net honey income and welfare perceptions after certification (2015) and before certification (2008), retrospectively. The results showed minimal to no significant impacts of certification on households' incomes, honey quantity or sales prices, as the general development, though positive, followed that of the noncertified households. The lack of impacts stemmed from failure to monitor and technical backstopping of certified beekeepers, a poor cooperative management and mistrust among the members and Mwingi organic cooperative board. The board mainly bought honey from a non-certified middleman thereby undermining the Mwingi organic cooperative's values as well as their own potential niche market. On a positive note, the cooperative's honey market place, receiving customers from afar, has the potential to support the development of a niche organic market outlet. However, this requires reconnection of the cooperative to its members, trust rebuilding and transparent management of the cooperative. The study exemplifies a case of community-based livelihoods-conservation initiative which did not take local community capacity development and more general long-term project sustainability into consideration.
Rural Development Focused Social and Solidarity Economy Organisations’ Social Impact Measurement: A Systematic Review and Ways Forward
Social enterprises (SEs), which have emerged more recently among social and solidarity economy organisations are touted for steering rural development through their social impacts. However, SEs’ social impact measurement is underdeveloped theoretically and empirically despite its importance in the social and solidarity economy, specifically within social entrepreneurship field. This systematic literature review documents empirical studies of SEs’ social impacts in rural communities and reveals that the literature on social impact measurement is sparse, recent, and dominated by case studies and qualitative analysis. It lacks consistency in defining social impact and the social impacts are overwhelmingly reported as positive despite a lack of attribution of such impacts to SEs. We advocate methodological improvements such as: using a rural livelihoods framework, project/program level impact measurement, application of appropriate social impact analysis methods e.g., mixed method and theory-based evaluation approaches. These could strengthen design and management of SEs’ programs/projects besides advancing scholarship of SEs’ social impacts.