Presentation of

Draft manuscript for the ISCE Conference on Social Entrepreneurship, Systems Thinking, & Complexity 2008, April 24-26, New York

Social Entrepreneurship through Creative Interaction in Culturally Diverse Groups

Findings from a participatory observation in a recent social entrepreneurship program in Cisondary, Indonesia

Daniela Beck & Prof. Dr. Li Choy Chong,Asia Research Center, University of St. Gallen, Switzerland

Our Perception of Social Entrepreneurship is that:

Social entrepreneurship is thought to help people: it is for the welfare and is embedded within a specific socio-cultural context.

Social innovation cannot „be delivered“ – it needs to emerge out of social (creative) interaction. Comparing perceptions characterizes these interactions in cross-cultural social entrepreneurship programs and is the source for creativity.

To help the 1 billion people who are currently living in deep poverty in the world, a lot of creativity is needed in order to find solutions which are environmentally, social and economically sustainable.

Approaching Perception

The German word WAHRNEHMUNG includes : •the sensual activity AND•the processing according to one‘s worldview: „to hold something for the truth“. The socio-cultural background is influencing our Wahrnehmung.

Basadur & Gelade (2003): Conception = alternative ways of understanding.

Source: Goertzel, B. (1997)

Creativity

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GROUPValue-in-diversity assumption: creativity surplus of groups

(Cox & Blake, 1991; Williams & O’Reilley, 1998; Watson et al.,1993)Cognitive Stimuli and Social Stimuli (Paulus, 2000)

Specific focus in the paper: cultural diversity - creativity

INDIVIDUALCognition

(Armbruster,1989 divergent vs. convergent thinking (Guilford, 1959)

CONTEXTSocial Psychology creative situations, (Amabile, 1983)

PROCESS e.g. Amabile (1983),

Basadur & Gelade, 2003)

INTERACTIONWoodman & Schoenfeldt, 1990: Interaction Model of Creative Behavior

COMPLEXITY THEORY APPROACH: CREATIVITY IS EMERGING AT THE EDGE OF CHAOS

e.g. Stacy (1996)

SEED Program 2007 (Social Enterprise for Economic Development)

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Set up:The SEED program is a collaborative program of the Asia Research Centre at the Chair of International Management (South East Asia),University of St. Gallen and the School of Business Management at the Bandung Institute of Technology

Participants: Students from the University of St. Gallen, the Singapore Management University and the School of Business Management at the Bandung Institute of Technology, undergraduate or graduate students.

Location & DurationBandung and Cisondary Village Community, Java, Indonesia

Method: Participatory observation in December 2007

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Market Analysis: Competitive Advantage

Key Points Details

Competitors Direct Competitors: 1. Al’Shifa Natural Honey 2. Langnese Forest Honey

Substitute products: 1. Sugar/Glucose e.g. Gulaku. However, their cross elasticity of demand

<1 poor substitutes in terms of usage for cooking and as a health product

Potential Entrants: 1. Other villages around Indonesia 2. Other developing countries who have land for fruit tree plantations

Advantage over competition

1) Low transport costs (compared to foreign imports) 2) Time to market -- short drive from Ciaul village to Bandung or Jakarta

markets 3) Fresh village Honey -- long term plan of a Just-in-Time system of

extraction and production 4) Tropical flavors/ blossoms based honey 5) Low labor costs of the farmers and village packers

Competitive positions

-Differentiated product selling a lifestyle & intangible aspects of the product -Relatively lower costing quality honey

Barriers to Entry

(in general: low barriers to entry to honey production and retail industry) -Technology of honey production -Established partnerships with distributors -Established & strong customer relationships -Experienced management team -Retailing differentiated products

Strategic Opportunities

-Supplier of royal jelly honey to cosmetics industry -Entry into sugar-substitutes industry

Opportunity discovery Implementation

To be continued and repeated in

2008

SEED Program 2007 (Social Enterprise for Economic Development)

Agent Groups in Interactions

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Comparing Perceptions: Honey

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Comparing Perceptions: Cowdung

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Comparing Perceptions: Dried Guava

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Emerging Social Innovation through Creative Interaction

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Source: Lichtenstein & Plowman (2007) Leadership in Emergence

Diversity in Perceptions

- „frozen stability“

cognitive stimulidisrupt existing

patterns

social stimuli collaboration

Local feedback: feasability, adequacy /

businessplans

Part of fu

rther elaboration

Supporting a creative situation by:

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Social Entrepreneurship means to foster creative situations which allow emerging social change.

A sufficient level of complexity is needed to allow emergence: Socio-cultural diversity bears creative potential

Fostering the interaction between agents with distinct socio-cultural backgrounds gives room for the emergence of social innovation

Diverse perceptions emit cognitive and social stimuli and break up „frozen stability“

Social Entrepreneurship is an open endeavor. Social innovation cannot be predicted but emerges out of the interaction of multiple agents.

Conclusion: