Sustainable social entrepreneurship and social value creation through marketing capabilities

Monday, 14 October 2019 00:00 -     - {{hitsCtrl.values.hits}}

Many entrepreneurs engage in business expecting profit and enhanced their performance of business. As entrepreneurship is facing dramatic competitive environment globally, entrepreneurs need a change in these days in their marketing efforts to enjoy competitive advantage. According to researchers, smaller firms need to be very competitive whether they are entering into global market or not. Smaller firms are merged with larger firms and consequently, they reach global markets too.

Entrepreneurship energises the economic development of a country by having a role of economic function specifically driving innovation and utilising the resources to the opportunities emerged as results of external environmental changes. It is also sensible to note here that entrepreneurial orientation will make entrepreneurs as risk taker and creator of the business. Entrepreneurship that is small and medium enterprises are the major engines of innovation as they introduce new products, new method of production, finding new markets etc. This is also due to the fact that there is greater incentive for people who are in the SMEs than larger firms.  

Therefore, entrepreneurship provides sources for economic development and thereby contributes to the sustainable development in line with sustainable development goals. In the case of sustainable development goals (SDG), entrepreneurship is well contributing to the achievement of SDGs related to food security, climate change, education, health, sanitation and water, gender equality and reliable sources of energy. In that sense, the entrepreneurship helps achieve SDG 9 which focuses on the building resilient infrastructure, promoting inclusive and sustainable industrialisation, and fostering innovation. 

According to literature, entrepreneurship is explained in two perspectives. One is business development aspects and the second is the aspect of entrepreneurial behaviour. The second one is linked to non-commercial sectors and commercial sectors. Entrepreneurship is considered to be new firms or small, micro and medium sized enterprises. 

Social entrepreneurship is vital for developing countries like Sri Lanka as it creates social value for the people. Social entrepreneurship means that creating social wealth by establishing new businesses or by managing existing business with innovation. Generally, social entrepreneurship differs from commercial entrepreneurship. The prime differences between these two types of entrepreneurship is creating social mission by which they sustain social value. 

Social entrepreneurs are recognising opportunities when others have problems with the vision to attain a solution to a social problem. Like other commercial entrepreneurs, social entrepreneurs are also engaged in continuous innovation and learning. Further, social entrepreneurs exhibit accountability and outcomes which is being created. They ensure that the serving goes to right people with the assessment of their needs and values. 

Entrepreneurships are presently playing important role in Sri Lanka in addressing intractable social problems. It also helps reduce inequality and poverty, and deal with environmental challenges. Hence, social entrepreneurship has been identified as a viable approach for solving some social issues in many developing countries. In addition, Sri Lanka’s many national policy frameworks talk about activities for which social enterprises are very supportive. 

For instance, Vision 2025 which is Sri Lanka’s national policy development also addresses social market economy focusing on generating one million job opportunities, enhancing income levels, developing rural economies and creating a wide and strong middle class. Hence, social entrepreneurship is yet to contribute more to the Sri Lankan economy. Added to the fact that startup of social entrepreneurship and their registrations are increasing rapidly in Sri Lanka. We have currently 5,000-16,000 social entrepreneurs in the country. 

By considering the significance of the social entrepreneurs, it is supreme to give a strategic importance to further improve their business and that may lead to further upgrading in the creation of social value. Social entrepreneurs in developed countries move from conventional activities i.e. purely for social works to business like marketing-oriented business. 

According to the World Economic Forum, social entrepreneurs are adopting market driven strategies and deal with social issues in an innovative way. However, social entrepreneurship is still at crossroads in developing countries. This can be overcome through adopting marketing orientation that is as in developed countries, social entrepreneurs to adopt marketing orientation and move to business like market-oriented sectors. 

Marketing orientation is implementing the marketing concept. Marketing capabilities is one of the vital aspects for a firm to be market oriented. Marketing capabilities are marketing management functions of an organisation. There are two types of marketing capabilities such marketing mix and marketing strategy development and execution. In many developed countries, social entrepreneurs also obtain benefits of marketing capabilities by developing the capabilities of marketing used by them. 

A research has been carried out by Gordon and his team. They have compared Japanese and UK social entrepreneurs as to how the marketing capabilities such as pricing, product, marketing information management, channel management, selling, marketing communication, marketing planning and marketing implementation. These capabilities, in fact, positively contribute and enhance the economic performance of the social enterprises that includes commercial marketing achievements and economic value creation. 

However, the capabilities influence the social enterprises economic performance in developed countries differently on social marketing achievement and economic value creation. In the case of British social enterprises channel management and marketing communication well contribute to the social marketing achievement. Pricing, marketing communication and selling capabilities absolutely uplift the economic performance of social enterprises in British. 

Contradictorily, channel management, marketing communication and marketing planning capabilities enhance the social marketing achievement in Japanese social enterprises. Similarly, product, channel management, marketing communication and marketing planning capabilities boost the economic performance of Japanese social enterprises. Thus, a thought-provoking fact is that contributing marketing capabilities to the economic performance is different from countries to countries. Hence, it may be required for Sri Lanka also to identify which marketing capabilities mostly influence the economic performance of the social enterprises in Sri Lanka. 

Despite the fact that Sri Lankan entrepreneurs are performing well and exerting value creation to the Sri Lankan economy, Sri Lankan social enterprises can further be developed and resultantly, it contribute further to the economy of Sri Lanka and policy frameworks by recognising which marketing capabilities are presently contributing to the social economic performance and what types of improvement are required in the marketing capabilities of Sri Lankan social entrepreneurship to further enhancement of economic and social performance.

(The writer is a Senior Lecturer in Marketing Management, Department of Marketing Management, Faculty of Management and Commerce, South Eastern University of Sri Lanka.)


  • Gordan L., Eng T.Y., Takeda S., (2015), An Investigation of Marketing Capabilities and Social Enterprise Performance in the UK and Japan, Entrepreneurship Theory and Practice, Vol. 39, No. 2, pp. 267-298
  • The State of Social Enterprises in Sri Lanka, British Council
  • Dees, J. G., Emerson, J. & P. Economy, (2001). Enterprising Nonprofits – A Toolkit for Social Entrepreneurs. New York: John Wiley & Sons.