ABC

INNOVATION BOOK FOR

SOCIAL ENTERPRISES

LAPPEENRANTA UNIVERSITY OF TECHNOLOGY

LUT LAHTI

ABC
INNOVATION BOOK FOR
SOCIAL ENTERPRISES

LAPPEENRANTA UNIVERSITY OF TECHNOLOGY

LUT LAHTI

AUTHORS
Virpi Koskela, Tuija Oikarinen, Suvi Konsti-Laakso,
Suvi-Jonna Martikainen, Helin Melkas

GRAPHIC DESIGN AND COVER ILLUSTRATION

Petri Hurme, Vinke Design Oy

PHOTOGRAPHS
Virpi Koskela ja Suvi-Jonna Martikainen

TRANSLATION
Sophy Bergenheim, Aakkosto Oy

Lappeenranta University of Technology

LUT Lahti
LUT Scientific and Expertise Publications
Tutkimusraportit Research Reports No. 31
ISSN-L 2243-3376
ISSN 2243-3376
ISBN 978-952-265-759-6 (PDF) (electronic publication)
Original Finnish version YYAapinen
yhteiskunnallisen yrittmisen innovaatiokirja (2014)
ISBN 978-952-265-654-4 (printed publication)
ISBN 978-952-265-655-1 (PDF) (electronic publication)
Swedish version
ABC Innovationsbok fr samhlleliga fretag (2015)
ISBN 978-952-265-758-9 (PDF) (electronic publication)
Lahti 2015

Foreword 6

A
1. Innovation Dictionary of the ABC Book
for Social Enterprises

2. The History of Social Enterprises in Finland

A Short Version 12
3. Viewpoints on Social Enterprises

13

B
4. How to Get Started as a Social Entrepreneur

20

C
5. How to Maintain and
Disseminate Social Activities 26
6. Where Could the Path Lead?

32

Afterword 36

Foreword
This innovation book for social enterprises furthers
the cause of sustainable development and holistic
innovation. It is aimed at everybody interested in
the activities of social enterprises. It can serve as
a resource for regional actors, such as municipalities or organisations or funds for regional development. The book is intended to raise questions and
thoughts, rather than provide answers. It is meant
to inspire and encourage. Hopefully it will also
increase understanding of social enterprises and
their importance for readers who are not yet that
familiar with the concept.
The innovation book is also available in electronic
form at www.lut.fi/lut-lahti (Julkaisut, 2015).
Lahti, February 2015
The authors

1. Innovation Dictionary of the

ABC Book for Social Enterprises
Innovation = a product, service or
mode of operation that has been
adopted or realised.

Practice-based innovation = the idea

for a new product, idea or mode of
operation is born through a practical
(problem) situation, and often involves
the cooperation of experts from
different fields. The innovation itself
is born by experimenting, doing and
learning in collaboration at the intersection of different knowledge areas.

Social enterprise = a company that focuses not only

on business activities, but also strives to solve social
or environmental problems through its activities.
Social enterprises can further their social goals both
through their own activities and by using most of their
profits in a way that furthers the cause.
www.avainlippu.fi/en/symbols/finnish-socialenterprise-mark

Work integration social enterprise (WISE) = a social

enterprise that seeks to ease a difficult employment
situation by employing disabled and/or long-term
unemployed people. The activities of work integration
social enterprises are based on a law that came into
force in 2004. The objective is to offer employment
opportunities for disabled and long-term unemployed
people. At least 30 per cent of a WISEs employees
must be disabled or long-term unemployed. The
Ministry of Employment and the Economy maintains a
register of social enterprises.
www.tem.fi/en/enterprises/social_enterprises

Job bank = the job bank trial is a project run by the

Ministry of Social Affairs and Health, which involves
developing a business model to facilitate the employment of partially disabled and long-term unemployed
people, young people without a first degree and other
people who are at a potential disadvantage in the
labour market. The objective is to create business
terms and conditions and a common operating
principle for job banks, to integrate job pools as part
of job bank activities, to improve and develop work
incentives, to employ people who are in a difficult
position in the labour market, to assess the need
for public assistance in job bank activities, and to
organise job bank activities on a nationwide level. The
job bank trial is one way of organising and supporting
the creation of common good.

In Finland, the concepts of work integration social enterprise and social enterprise
are easily confused. The Finnish term for WISE is sosiaalinen yritys (social
enterprise), whereas social enterprise is yhteiskunnallinen yritys (societal
enterprise). The confusion stems from the English word social, which has the dual
meaning of social/societal, which often leads to translation difficulties. In this case, it often
raises the misconception that a social enterprise operates within the field of social care.
It could be useful to add definitions for social enterprises according to their field: an
environmental social enterprise, for example.
In other words, a social enterprise can operate within any field, just like any ordinary
company, but in addition to business operations, a social enterprise strives to produce
common or social good for the environment or some community.
9

Job bank enterprise = a limited company or

cooperative that engages in business activities
and employs people at a potential disadvantage in
the labour market (partially disabled, long-term
unemployed, young people without a first degree)
in their own production, through subcontracting
or by leasing workers and finding job placements
at client companies. Job bank enterprises
canvass and strive to develop their workers skills
alongside their work duties and lease workers
according to the needs of client companies. The
employment relationship between the worker and
the job bank enterprise remains in force during
lease periods. When the worker is not working,
they can participate in education or training.
www.tyopankki.fi/info (in Finnish)

A social innovation can be defined in several

different ways. In this book, a social innovation
refers to a new mode of operation which addresses
the social needs of an individual or community,
and thus improves quality of life and well-being. A
social innovation is often the result of the creative
activities of an individual, group or community,
which combines existing provisions, practices and
know-how in a new way. In other words, a social
innovation means seeing a familiar thing from a
new perspective; a new kind of comprehensive
understanding, which teaches people to operate in a
new way. Examples of social innovations include the
maternity package, paternity leave, Nordic walking,
the Common Responsibility Campaign and free-ofcharge school meals.

10

Sustainable development thinking is based on the

concern about inequality between people and the
vitality of ecosystems that form the basis for life.
Sustainable development focuses on three themes:
ecological sustainability
economic sustainability
social and cultural sustainability.
Sustainable development is social change that
occurs and is guided on a global, regional and local
level. Its objective is to ensure that present and
future generations have the opportunity to have a
good life. Sustainable development has played an
important role in the strategies and programmes of
the Finnish government since 1990.

Social sustainability is one of the focal points of

sustainable development. Its purpose is to diminish
inequality between people, to ensure that everyones basic needs (such as food, education, freedom
of speech) are met and to create preconditions that
allow individuals to take care of their own wellbeing. Current social challenges in Finland include
unemployment, social exclusion, ensuring the
future activities of public services, and the growth
of income inequality.

As far as innovation is concerned, what is essential is to combine things in a

new way. A social enterprise is in itself a form of innovation, which combines
the creation of social good and entrepreneurship.
In the future, keep your eyes peeled and your ears to the ground: what is the
problem? Innovations spark new innovations; social enterprises could seize the
opportunity and sniff out new opportunities to create new practice-based innovations.

11

2. The History of Social Enterprises

in Finland A Short Version
Social enterprises are a relatively new and unknown phenomenon in
Finland. Around the world, social enterprises have been seen as a solution
for societys wicked problems, such as unemployment, social exclusion or
environmental problems. A social enterprise is thus a broader concept than
the work integration social enterprise, which according to the law focuses
on social employment. There are different views on how the phenomenon of
social entrepreneurship was born and how the concept should be defined,
but the central issue is around maximising social value.
Even though the social enterprise is a concept of the 21st century, the
roots of the phenomenon date further back in time. The early 20th century
work centres, which later became Christian settlement houses, and rural
cooperation activities and cooperative social insurance funds were early
manifestations of the social mission. One of the most famous of these is
the Linnanmki amusement park. In 1950, six associations engaged in
child welfare founded the Linnanmki amusement park, and a few years
later, the Childrens Day Foundation. The purpose of the foundation is to
raise funds for child welfare work in Finland by maintaining and developing
the Linnanmki amusement park. During the latest years, Linnanmki
has raised an annual profit of 3 million Euros for its social mission. The
Childrens Day Foundation was established by the Swedish-speaking
Barnavrdsfreningen i Finland (the Finnish Child Welfare Association), the
Federation of Mother and Child Homes and Shelters, the Central Union for
Child Welfare, the Mannerheim League for Child Welfare, Parasta Lapsille
(The Best for Children) and Save the Children.
The concept of social enterprise (sosiaalinen yritys) was coined in the
mid-1990s. Social enterprises were born out of business development
activities within social workshops and work cooperatives. The Act on Social
Enterprises entered into force in 2004. According to international definitions,
these Finnish social enterprises are work integration social enterprises.
In 2011, the Finnish Social Enterprise Mark was launched as a result of work
by the Ministry of Employment and the Economy, and is governed by the
Association for Finnish Work. Holders of the mark commit themselves to
the criteria for social enterprises, which include, among others, restrictions
on profit distribution, transparency of activities and the generation of social
good. In 2014, nine social enterprises founded the Finnish Association for
Social Enterprises to represent and further the cause of social entrepreneurship. The association is a member of the Confederation of Finnish Industries
(EK). Elsewhere in Europe, social enterprises have been attracting broader
interest for a long time; a similar development is probably coming in Finland.
12

3. Viewpoints on Social Enterprises

Social enterprises are traditional enterprises as well. What makes these enterprises social is the fact that the operation
of the companies focuses, in addition
to the traditional issues, on, e.g., social
sustainability or the renewal of society.
Social enterprises can also be based on a
philosophical viewpoint: a strong ethical
perspective, for example.

3.1 Entrepreneurship
The direct and indirect implications of private enterprises on employment,
well-being and the success of our national economy are significant. New
means for supporting Finnish enterprises are being researched and developed, and there is much discussion regarding the topic. A great deal of effort
is being put into furthering the establishment of new companies and the
growth and internationalisation of existing companies (see, for example, EKs
website: ek.fi/mita-teemme/yrittajyys/, in Finnish).
Being an entrepreneur is a tough job but also very rewarding at its best.
When entrepreneurship and companies business activities are observed
from the perspective of an ordinary company, it is clear that many traits are
needed in order to be successful.

You need to master a lot of things as an entrepreneur.

Substantial know-how is paramount. In addition,
you need to know how to manage your business:
production, marketing, accounting and HR. You have
to be able to develop your business: envisage, set
goals, plan, organise and implement. Follow-up and
evaluate. You have to be a good business partner and
have good communication skills. You need to believe
in your own competence, be brave, take risks, take
the initiative. You must be independent, persevering
and goal-orientated. Oh, and of course you have to be
eager to learn new things!
13

The same skill set requirements apply to a social entrepreneur as well. The
business activities of a social enterprise and a regular enterprise can be very
similar. However, the important difference is that a social enterprise does not
only seek to generate profit for its owners, but acts as a tool for doing something beyond that: generating social good. The results of a social enterprise
cannot be evaluated using the same indicators as a regular company.
What, then, is required of a social entrepreneur, compared to an ordinary
entrepreneur? In Finland, the criteria of the Association for Finnish Work are
usually used for defining social enterprises (www.avainlippu.fi/en/symbols/
finnish-social-enterprise-mark). The most internationally recognised
definition has been formed by the EMES European Research Network:
commercial production of products and/or services distinction
from the third sector (activities of associations and organisations)
freedom of decision-making the company cannot be under the
control of an outside owner or the public sector
economic risk the operations must generate enough profit to
finance production costs
wage paid for made work business activities cannot be based
solely on volunteer work or business support
According to EMES, the criteria for a social enterprise are:
the objective is to generate benefits for the community
the activities have started as a joint effort and shared objective
of a community (group)
rights to make decisions are not tied to ownership
engaging decision-making practices, shared leadership
restrictions on profit distribution

Even one person can establish a social

enterprise by themselves to further
their goals. Is it still important that the
objectives and values of the enterprise
are taken into account and shared with the
employees at the time of recruitment or as
the activities are kicked off, at the latest?

14

I heard that social enterprises

can be used for solving societys
wicked problems Oh yeah: how?
Well, by engaging the people
who are truly affected by the
enterprises cause as soon as the
starting phase
and by genuinely working
together. Without clutching on to
the role of the heroic entrepreneur
and individual performance!
By paying special attention to
making sure that the workers can
both perform their work in a meaningful way and develop their work.
By seeing to the quality of work life.
In everyday work life, it is important
to pay attention to the personnels
well-being and equality.
I jumped here from page 32.
Theres a whole lot going on about
these big issues in the rest of the
book. Hey: keep on reading!

15

So it seems that all this change and

turmoil in society is a million-dollar
question for social enterprises

3.2 The challenges of reforming society

Our society is in a state of constant and rapid change. There are more
challenges than we have time to address with conventional means. How will
we solve the challenges and problems related to unemployment, the ageing
population, loneliness and pollution? These wicked problems are multifaceted, and it is challenging to develop sustainable solutions. Social enterprises can act now and in the future as one of the keys for finding solutions.
The changes occurring in Finnish society are not only about reforming the
social and health care sector, for example, but about taking into account
everything that is going on around us and in our environment. Many
organisations are more and more aware of how they can participate in
the surrounding world through their own values and actions. The neighbourhoods within enterprise and organisation fields and local actors are
increasingly important partners good neighbours have become a part of
the brand and profile of every self-respecting company. Social and ecological viewpoints have gained foothold in business strategies.
The procurement rules of orderer-producer services are undergoing
changes which are to the benefit of social enterprises in Finland as well,
where services form the largest share of total production. We are seeing,
and will be seeing, the birth of new, less hierarchical organisations, which
are not governed by the rules of economic profit maximisation, but are
based on more sustainable values, transparent modes of operation and
flexible employment. At the same time, consumers have grown to be
increasingly aware of the value choices made by service producers. Individual municipalities and organisations operating within municipalities and
regions also make themselves known to consumers through their values.
A consumer operating from a sustainable perspective puts thought into
their selection of a company when they need a service or product. Has the
company taken account of social sustainability (e.g. the social exclusion risk
of young people, or the growing unemployment rate) or other perspectives
of sustainable development (e.g. climate change or biodiversity)? What kind
of energy does the company use; do they recycle or favour local production?
Is the service or product that the company offers a practice-based innovation, created collaboratively to address genuine grassroots-level needs?
Does this product cater to the needs of the consumer, who is often looking
for solutions to practical problems?

16

Society is thus changing on many levels in terms of individuals values,

attitudes and methods of action, organisations and sectors, nationally and
globally. In a thoroughly networked world everybodys choices and modes
of action affect the whole.

3.3 The philosophical perspective

From the philosophical perspective of sustainable development, social
entrepreneurship is linked with socially, ecologically, culturally, economically and spiritually sustainable values and ethics. The metaphor that can
be used to describe this relationship is one of the worlds oldest symbols:
The Tree of Life. The figures that gather under and around the Tree of Life
represent the kind of common good that everyone living on this planet
needs now in a time of deforestation, climate change, pollution, erosion,
famine, inequality, wars and diseases maybe more than ever.
The perspective linked
I can see far into the future from
with the Tree of Life
the branches of the Tree of Life! All
is connected to an
the way to my, my childrens and my
environmental or eco
grandchildrens future.
philosophy that deals
with the interaction
Woof! Woof!
between man and nature. In order for the
human race to survive, ego philosophy must
turn into eco philosophy. We need a paradigm
leap from accumulating personal wealth and
utilising natural resources to a more planetary, wholesome way of living a leap from
exploitation to collaboration.
The Tree of Life way of thinking originates from native people and old
cultures. It has been revived in recent years to develop the innovativeness
and leadership of organisations, among other things. Now, in an era
of crisis, we are also experiencing a time of communal and ecological
convergence, as if we were waking up from a dream.
Life on this planet is sacred, and maintaining life makes our existence
meaningful. This philosophically virtuous and ethical concept is beginning
to replace the mechanistic conception of the human as a mere cog in the
machine. People who have had enough of the treadmill have noticed how
the experience of meaningfulness strengthens commitment and creates
more sustainable attitudes and methods of action, with regard to work as
well as everyday life in general.
Social entrepreneurship is suited to a Tree of Life way of thinking, since the
space for common sharing (which we will talk more about in Section 5.3)
17

required for creating and running a social enterprise is a circular, democratic, socially and ecologically sustainable space, in which the common
good is taken into account just as with the Tree of Life.
The Tree of Life represents the heart that has a multifaceted connection
with its surroundings. All of its parts are equally important: the seeds,
sprouts, trunk, roots, branches, leaves, flowers and fruits. Cultures that
led a more sustainable life than current generations have for thousands of
years gathered around large trees (wise professors) to teach, learn and
spread information experience, in other words.
In work life and entrepreneurship we value the
head. We think with our mind, even if it is matters
close to our hearts that we are willing to fight for.
If your heart says one thing and your mind the other,
I suggest that you choose whichever furthers life.

In our current everyday work life, the space for common

sharing by living organisms, organisations, is a concrete
example of such a common log fire or cross-pollination
that is needed for observing things globally from the
perspective of shared life.

How does your workplace/organisation/job take the

Tree of Life into account? In what ways do you further
the common good?
How could the common good be measured?
18

19

4. How to Get Started

as a Social Entrepreneur
Establishing a social enterprise is not necessarily that different from
establishing a regular company, but on the other hand it can involve a
significantly different process. There are many kinds of variations. Social
enterprises differ, for example, in their recruitment processes and in how
they initiate the founding process.
The following describes the first phases of the foundation of a social
enterprise; where it all began and how the ideas for the business were
gathered. Among its differences from an ordinary company, in our example,
the process was not initiated by an entrepreneur with a business idea which
was entirely deliberate. Instead, hundreds of mental health care rehabilitation clients were asked to throw in ideas about what kind of company
they might want to start. In order to bring up, distribute and develop ideas
from such a large and heterogeneous group, non-conventional working and
innovation methods were needed. Functional expression methods were
utilised to process the business ideas created at the common workshops.

The Dreams and Fears workshop

run by the preliminary board,
summer 2012, before the actual
business idea workshops.

20

The workshops for innovating social enterprises worked on the participants own
dreams regarding future businesses, among
other things. Here is one dream collage.

An example of founding a social enterprise:

Business idea workshops at the Bee
for Common Economy
During 20122013 in Lahti, a social enterprise was planned in cooperation
with mental health care rehabilitation clients and the Bee for Common
Economy (Yhteisen talouden talkoot), i.e. four third-sector actors. The
Social Psychiatric Foundation
of Pijt-Hme (Pijt-Hmeen
Could opportunities and new worksosiaalipsykiatrinen sti), the
places be created on the basis of a
Family Association Promoting
communitys know-how and passions?
Mental Health and Lahti
What if having a sense for such things
Clubhouse gathered business
is having a true nose for business?
ideas from their members in
workshops organised by the
Lahti School of Innovation of Lappeenranta University of Technology during autumn 2012. Applied art and silence methods,
sharing personal experiences and developing these ideas
further in groups were selected as the means for gathering the
21

Testing and developing ideas in the

business idea workshop, autumn 2012.
ideas. Engaging exercises helped participants to detach from conventional,
mind-focused brainstorming and instead adopt new perspectives and
reach a state of common innovation. Six workshops lasted one afternoon
each, with 1030 participants per workshop.
The following pages describe the basic structure of the workshops, which
shows how creative, functional methods are well-suited for finding new
ideas. Throwing around ideas is not a matter of a dialogue inside ones head,
or a discussion within a group, but involves the whole human life experience,
and first and foremost, experiences of meaningfulness. The workshops
aimed to bring out every participants own experience of where, how and
why they had felt they were doing something meaningful. This also facilitated identifying peoples own inner potential, since the business opportunity is closely linked to the moments and experiences of human life.
The ideas born during the workshops were gathered on both the idea wall
and the idea form specially crafted for the business idea hunt. The workshops generated over a hundred business ideas. The participants themselves selected the ideas that they wanted to develop further. During 2013,
two ideas progressed further, one of which went all the way to planning
the business model and the testing phase. In 2014, it was time for the pilot
phase, which turned out to be successful. Now, on the basis of the pilot, a
Lahti-based social enterprise is about to see the light of day. It offers peer
support services for mental health care rehabilitation clients.
22

WORKSHOP MODEL FOR THE BUSINESS IDEA HUNT

Opening the workshop
1. Introduction
2. Warm-up
3. Orientation
4. Improvisation
5. Silence
6. Opening up to ones own experiences /
mental exercise
7. Sharing experiences /
developing ideas further
8. Presenting business ideas

Detailed description of the content:

1. Introduction:
The person in charge of the project
and the leaders of the workshop
introduce the idea of the afternoon,
i.e. leave your brain in the cloakroom,
in order to open up the participants
experiences and imagination to finding
new perspectives and ideas.
2. Warm-up:
Who am I and where do I come from?
What mood am I in today? What have I
brought along?
a. Suggestion: the creative child introduction: Introduce yourself with the
wrong hand, new name and new
title. Your new name consists of your
own second name and your mothers
maiden name; your title stems from
your childhood idol (for example,
what did you play as a child? Who
did you admire)? For example:
Alice Jones, country singer. Every
participant introduces themselves to
the group in turn.

b. Suggestion: The Finnish map

exercise: The participants form an
invisible map of Finland on the floor:
where am I from? (The leader marks
south and north for the participants;
chatting with the other participants,
everyone locates their own spot on
the map.)
Variation 1: The same exercise, with
the following addition: my roots and
how local people have affected me.
For example, whose memory do you
cherish and why?
Variation 2: A typical description of
your home region / share a memory
related to the place. Group discussion, after which the group leader
highlights a few experiences which
focus on todays theme.
3. Orientation to the theme:
Inspiration is sought from work
pictures. The participants choose
from a picture selection compiled for
the workshop a picture that represents their own vision: what picture
illustrates what it could be like to
work in the company being planned?
The participants are then divided into
groups based on the pictures. Group
discussion: what kind of company
could the people in the pictures form?
Thereafter the groups play statues
that form a still picture. The picture
illustrates a situation from the future:
what is happening in the company on
an ordinary Wednesday at 10.45 a.m.?
As each group plays statues, the other
participants discuss what is going on
with the statues and give the statues
(and company?) names.
23

4. Improvisation:
According to Keith Johnstones
improvisation philosophy, creativity is
born when peoples ordinary thoughts
encounter each other in an accepting
atmosphere. In this way, thoughts can
interact and change in the interaction.
Improvisation is the background
behind the Yes, and exercise, which
serves as a basic principle and rule for
throwing ideas about and commenting
on others ideas. The objective of the
exercise is to accept every idea raised
within the group with enthusiasm, and
to take it further with ones own idea,
all the time adjusting to new ideas in
an accepting way. The magic words
are Yes, and Simply put: I have
an idea about a caf Yes, and you
could organise fly tying workshops
there (not: I dont know, I think
there are too many cafs as it is, but
you could sell fishing equipment )
The goal is to reach the source of
creative thinking without press and as
a group joint effort.
5. Silence:
The leader asks the participants to
close their eyes and seek a position
they can maintain without moving for a
while. People either sit in their chairs
or lie on their back on the floor, hands
and feet relaxed, but with a straight
spine. Breathe in deep breaths and
guide your breathing and consciousness to the lower abdomen. Create an
image of breathing in and out of your
navel to the rhythm of your natural
breathing. Release all tension in the
body. If you notice thoughts coming,
just let them come and go: do not
hang onto them. Once you concentrate
on following the movement of your
breathing, the thoughts will dissolve.
Continue for 1020 minutes. Try to
stay as still and quiet as possible.
24

6. Opening up to ones own experiences

/ mental exercise:
The leader asks the participants,
who are still in a state of stillness
and silence, to let images rise to their
mind: images of moments when they
feel they have done something with
such enthusiasm that they forgot
about themselves, something that was
enjoyable, something meaningful:
Think about experiences when
you have done something that felt
meaningful, when you have been
truly present in what you do. Observe
your memories and experiences and
choose one to share with the group.
Pay attention to the details of the
experience: What? Where? When?
With whom? Why? The meaningfulness and relevance of work are
important criteria for the quality of
work. In this exercise, the participants
bring to mind their experiences of
meaningful doing and work.
7. Sharing experiences /
developing ideas further:
The participants write down their
experiences and the ideas that arose
from them on post-it notes, which are
gathered on a large wall. When the
wall is complete, all of the participants
can move and divide the notes with
similar themes into groups. Once
the grouping has been done, the
participants form groups according to
the groups formed by the notes. This
section of the workshop is called the
space for common sharing, which
was mentioned previously.
8. Business ideas and improvisation:
The groups develop common experiences and ideas into business ideas,
which are then presented to the other
groups through posters or adverts.
At this stage, it might be useful to
remember the Yes, and principle.

25

5. How to Maintain and

Disseminate Social Activities
A social enterprise must get by in the market through its own competitive
advantages, just like a traditional company. A social enterprise must also
reform itself, just like a traditional company. And being innovative is not any
easier in a social enterprise than it is in other kinds of enterprise. How do
you maintain the drive and passion for social entrepreneurship, then? How
can continuous innovation support the vitality of social enterprises?

5.1 Identify and communicate

the impact of social entrepreneurship
It is not always easy to identify impact. We get easily caught up in what
we want to do. We may even recognise what results our actions have. But
what do these actions and results affect, in the end? Who benefits and
how? It is central to argue how you believe your company will achieve the
desired results: what is the connection between actions and effects? What
benefits are sought through the social enterprise, from the perspective of
the entrepreneur, employee, community, partners, region, branch, Finland,
Europe or the whole world?
Social enterprises can be pioneers that grab hold of new things as society
changes, and do things differently. In order to create innovation, you must
first identify the effect you wish to have, and then work out how this can
be achieved. Social enterprises should brace themselves for being asked
about their impact and how it can be demonstrated. Once you know what
you affect and how, your business becomes more meaningful for yourself, it
is easy to share your viewpoint with your clients, and you can demonstrate
the effects of your business to interest groups.

How do you keep your own passion alive? How

can you spark that passion in your clients and
interest groups?

What is the engine of your field of operation?

What kind of drive would be needed within
your field? And what about our common field of
operation, the whole planet?

26

Case study: Marys bistro

Mary wants to become an entrepreneur in the restaurant business and employ

herself. She wants her restaurant to act as a meeting place for the local community and thus create community spirit. Her wish is to create a space for presenting
young artists artwork. She wants to offer people healthy food, whose preparation
creates jobs for people who are in a difficult position on the labour market and
immigrants, as well as internships for students. Regarding raw materials, she
wishes to employ local food producers, which would also keep the transportation
distance short.

The benefits and impact of my bistro? You

mean in addition to providing fun work for my
employees and myself?

Marys bistros impact on the city:

Marys bistros impact on the employee:

the companys tax revenue balances

the citys economy

work and income

unemployed citizens get jobs; income

support expenditure and social
exclusion is decreased

mental well-being, an experience of

meaningfulness, a sense of belonging

increases well-being and communality

develops multiculturalism
promotes equality
improves the cityscape and the
citys image
inspires others to start their own
social enterprise
enlivens the local culture and
art life and highlights the skills
of art students
Source: Workshop organised by LUT LSI
(20.3.2014), discussion between the facilitator
Jaana Merenmies and the participants on how to
identify impacts.

learning and developing skills

facilitates young people entering the

labour market
helps immigrants to integrate
into society
gives a partially disabled person the
opportunity to work according to their
own strength, or a person who is soon
to retire the opportunity to ease their
workload gradually
according to some studies, having
meaningful things to do is one of the
most important factors contributing
to happiness!

27

5.2 Familiarise yourself and understand the

procurements and strategies of your field
Social enterprises are client-orientated and engaging by definition. In innovation activities, the client is a central, if not the most important, source
of information after all, it is the client who decides whether a product
or service is worth buying. It is therefore advisable to take the client into
account from the very beginning; to try to understand the clients world as
accurately as possible and to develop solutions for their problems. User
orientation also includes observation and, for example, stopping to think
about client feedback. What lies behind the words?
Where consumers and private companies are the masters of their own
funds, the public sector is a special case as a client. The procurement
activities of the public sector, such as municipalities and cities, are regulated by the relevant legislation, rules and regulations. When a company
receives a procurement request from the public sector, the process is
practically already hammered through and the only thing left is to see
that everything happens in accordance with the law. The process is like a
long-distance train pushing through, with no extra stops.
However, the procurement process is being reformed. The objective is
to update procurement methods so that they create opportunities and
encourage innovative procurements. Public procurements can affect young,
growing fields of business, in particular. In terms of efficiency and impact,
for example, the social and health care sector needs innovative solutions.
However, the challenge for the municipal procurement organisation is to
recognise where services can be bought. It is important to develop new
approaches and to utilise networks to address this challenge. One new
approach is HankintaSampo.
HankintaSampo is a dataJust a tip: build networks, inform
base-based discussion and
yourself about the municipalitys
communication platform,
strategy and use it to justify the
through which even small
importance of your business.
procurements can be organIdentify your clients e.g. the
ised. However, the authorities
social and health care field
who are in charge of procureprocurement practices and the
ments are not always aware of
objectives of their procurement
how what seems like a small
programmes. Observe and
amount of money to them can
listen to the client. Engage your
be a vital deal for a small local
employees in innovation and
business. This is where good,
development work. Participate in
clear communication comes
your clients development projects
into play.
yourself. And try out new things,
learn from them, and try again!

28

5.3 Utilise new methods

Finding new solutions requires new methods. The starting point for the
following method is a space for common sharing. The space for common
sharing refers to circumstances that allow equal sharing of experiences and
the fact that a shared understanding is formed and developed. The space for
common sharing consists of the dialogue between engagement, participation
and involvement, in which everybodys voice and experience is heard.
The space for common sharing comes in handy, for example, when you want
to change or develop the activities of a work team, community or organisation. It facilitates a group-orientated, so-called new leadership, and the
employees stronger involvement in the organisations activities. And as has
been seen previously, these are often key components of a social enterprise!
The space for common sharing can be described as a three-stage process
as follows (adapted from Kaarina Mnkknen):
1. Building a shared understanding
involves sharing experiences of the work organisation; its current
situation, its challenges and its successes. Through the sharing of
experiences, a so-called shared understanding or shared space is
formed, in which everyone is easily able to hear, listen and be heard.
2. Challenging through dialogue
involves pondering and addressing the arisen questions in a constructive manner, respecting and without judging others opinions and
experiences, even if they are very different from your own. This is
the only way to reach a sufficient level of understanding in order to
change modes of action.
3. Sufficient understanding
means challenging new perspectives and practising new ideas, for
example by starting a concrete change process in collaboration.
Everyone is in the same boat and committed to whatever happens next.

Also see the description

of the business idea hunt
workshop on page 23.

29

Examples of different techniques for creating

a space for common sharing
The following section describes some methods
which can be used for finding new solutions.

Innovation session
The central issue in the innovation session method are outside experts
people who are not cooperation partners, but with whom a collaborative
relationship could have potential. The objective is thus to find completely
new viewpoints and solutions, maybe even radical innovations, by
combining fields of expertise in a new way. The innovation session is a
challenging method, because reaching a shared understanding between
experts and fields of expertise which are far apart requires hard work:
questioning and re-evaluating ones own self-evident truths and premises.
The moderator or chair plays an important role: their task is to foster a
fruitful dialogue between the different participants, which requires both
cognitive and social skills.

The clients voice

Client orientation is the cornerstone for developing business activities.
But how can a company involve its clients in development work? And who
is the client? After all, the user and buyer of a service are not always the
same person or organisation. In such cases, both parties voices should
be heard in the development work. Traditionally, client orientation has
translated into companies asking for their clients opinions and feedback
on the companys existing business and services. But what if you wish to
create something entirely new? The client cannot necessarily formulate
what service they would need, if they are not familiar with the latest technological development or what services and service providers exist, for
instance. To create new products and services, and modes of operation,
a process of collaborative creating is needed; a process that involves end
users, buyers, service providers and other potential partners innovating
together in a yes, and atmosphere and building a shared understanding
of the possibilities of tomorrow.

The client parliament

When a service or product has awakened interest, clients who have experience of it are invited to the client parliament. They are interviewed and asked
to talk about concrete examples of their user experiences. The story theatre
method can be used for making experienced knowledge visible and heard.
Actors interpret and portray the clients experiences and thus provide a basis
and development method for the common discussion. The client parliament
has been used for developing home care for the elderly and for making the
voices of the clients of adult education centres heard, among others.
30

The talking stick

The participants are settled in a circle, seated or standing, around which
the talking stick, which gives its holder the floor, circulates from one
participant to the next. The length of comments is agreed upon beforehand,
and every participant must stick to the time limit. Everyone listens to the
person with the talking stick, without interrupting, commenting or judging.
This method enables even the quiet ones to get their voices heard. Respectively, the more vocal ones learn to listen when others speak, without
interruption or other reactions.

Press-free innovation
The method for innovating is open acceptance: things do not have to be
either-or; they can also be both-and. Remember Yes, and !

Detective agency of non-clients

Non-clients are asked to find factors that could wake their interest for
trying or using a service. The non-clients also create a profile of themselves, for example on the basis of mini biography questions.

Finding the source of meaningfulness/relevance

The methods objective is to find sources of meaningfulness by utilising
silence, meditation or writing (see, for example, the mini biography questions). Ponder what business activities could be like, if they were based on
meaningfulness.

Mini biography questions

The mini biography questions can guide individuals to their personal
sources of meaningfulness (the questions are based on the work of
everyday explorer and collective artiste Meiju Niskala):
1. The
best news
most delicious meal
greatest idols
most communal experience of my life?
2. Realised dreams?
3. Dreams that have yet to become reality?
4. The greatest lesson Ive learned?
5. My biggest accomplishment?
6. A life guideline or wisdom I believe in?
7. I get strength from (write a list)
31

6. Where Could the Path Lead?

This chapter attempts to map the future a little, largely through the words
of social enterprises themselves. Could you become a social entrepreneur
or a worker at a social enterprise? If you already are, what could you do
differently? Or how could you support social enterprises? What good could
they generate in the future?

The objective of businesses is to increase

growth, enter international markets, become
highly competitive and generate profits for their
owners
What a leap, all the way from page 15! Dear reader,
now that you have come this far in this book, you
can answer the following question: is the purpose
of business different when it is evaluated from
the perspective of sustainable principles? Do the
goals change?

The primary criteria for a social enterprise are generating

social good, transparency of operations and restrictions on
profit distribution. Could the above-mentioned criteria form the
selling point of social enterprises? Do they attract clients?

Choose your image and brand so that they are

meaningful to you; so that you stand behind them
solid as a rock. What do you want to further?

32

The image of business what kind of ideas and

practices do you want to create and further?
The world changes and reforms, as do peoples attitudes and perspectives.
Ordinary people are becoming more and more aware of the powers and
choices that affect the environment, themselves and their communities.
People appreciate reliable, easily recognised brands and images that are
based on a comprehensive understanding of peoples everyday lives, values
and surrounding reality. It is already known that every mundane act and
action has an impact on the whole.
Workplaces and firms that take such things into account are the ones that
give birth and raise the future new life; a life very welcome in the business
world, as well.

Test your social

entrepreneurship potential

Why dont you

give it a try?

Do you think something should be done about an issue you find important?
Do you / your organisation / your network have concrete experience in
the matter?
Could the idea be combined with the establishment of a social enterprise?
Are you ready to share your ideas and thoughts with members of your
network who have similar viewpoints?
Could you create a so-called space for common sharing for gathering
thoughts and ideas?
Do you want to send out a message that you can be trusted?
If you answered yes to all or most of the questions above, you are a potential
(social) entrepreneur and this book did not end up in your hands by coincidence.
The following pages envision the future, content and meanings of social enterprises in 2024, according to social enterprises and entrepreneurs themselves.
Which branch will you climb onto?

33

In 2024
In 2024, there are no
more divisions between
people! All kinds of
people are equally
represented and part of
the group.

people live in small

community houses or
housing estates, which
are social enterprises.

Everyone who wants to

live communally gets to
join the community.

34

Cooperation creates
sustainability in as many
life areas as possible.

All companies, or at least

most companies, are
social enterprises!

People recycle, move

and travel sustainably
and are able to choose
their services on
sustainable grounds.
For example, a bank or
insurance company!

Environmental crises
force us to develop new
solutions

Work life includes flexible

decision-making.

Virtues and generating

good instead of material
things become the status
symbols!

People buy things only

for true needs and
things that are comprehensively good, not
only cheap.

The buyer and seller

work together for a
shared cause and goal.

Sales work means

genuine communication
and interaction.

It is trendy and cool

to work in a social
enterprise.

Companies are
profitable and have
their own personal
characteristics

and there are other

kinds of funding than
project funding or
business support.

The worker gets real pay

for a real job.

Everybody wins: the

individual, the company
and society!

Source: Workshop organised

by LUT LSI (14.5.2014), group
work envisioning the future.

35

Afterword
This book is the result of two projects by the Lahti School of Innovation at
Lappeenranta University of Technology. The Social Entrepreneurship in
Innovative Value Creation (SOCENT) project (20132014) was funded by Tekes
and was implemented in collaboration with the LUT School of Business. The
Pijt-Hme as the Leading Area of Practice-Based Innovation Activities
(Pijt-Hme maailman johtavaksi kytntlhtisen innovaatiotoiminnan
alueeksi) project (20112014) was funded by the European Regional Development Fund, the Regional Council of Pijt-Hme and the City of Lahti.
The objective of the SOCENT project was to increase the understanding
of the operating environment and special characteristics of social enterprises, to offer participatory innovation support for social enterprises, and
to support the strategies and politicians who wish to support and further
the development and utilisation of the unused or underused intangible
capital of social enterprises and their employees.
The SOCENT project group at the Lahti School of Innovation consisted of
Senior Researcher Tuija Oikarinen and Project Researchers Virpi Koskela
and Suvi Konsti-Laakso. Professor Helin Melkas acted as the responsible
director. Project Coordinator Suvi-Jonna Martikainen from the Lahti School
of Innovation also contributed to the creation of this book. In the early
stages, Project Coordinator Laura Mellanen participated in the project; we
wish to thank her for documenting the workshops and for planning the book
and its visual appearance. Project Coordinator Hilkka Laakso has been a
valuable support in creating this book and throughout the project.
The authors of the book wish to send a warm thank you to Tekes in
particular the supervisors of the SOCENT project, Mervi Pulkkanen
and Christopher Palmberg, as well as Minna Suutari, who acted as the
supervisor in the projects early phase. In addition, we would like to thank
Kaisu Puumalainen, Helena Sjgrn and Pasi Syrj, who participated in
implementing the SOCENT project at the LUT School of Business. We
also wish to thank the steering group and the company and organisation
representatives who participated in the network event for social enterprises and the related three innovation workshops at Lahti in spring 2014.
A special thanks goes to the workshop facilitators, Jaana Merenmies
(Impact House), Minna Halonen (City of Lahti) and Jukka Lindberg (VATES-

36

sti). These meetings clarified for us which themes we should select

for this book. The members of the steering group at the end of 2014 were
Tiina Hanhike (Ministry of Employment and the Economy), Jari Huovinen
(EK), Sami Metsranta (the Social Psychiatric Foundation of Pijt-Hme
PHSPS), Kimmo Nekkula (the Association for Finnish Work), Harri Niukkanen (Tramel Oy) and the representatives of Tekes, Mervi Pulkkanen
and Christopher Palmberg. A large thank you goes to Sami Metsranta,
Christian Lilius and Mervi Piiroinen from the Soteho group of the Bee for
Common Economy for letting us participate in the foundation of a new
social enterprise.
A dream for which we are ready to work together, generates good and
does not exploit anybody, is bound to become real (J.L. Padilla)

37

Literature
Defourny, J. (2001) From Third Sector to Social Enterprise, in Borzaga, C. & Defourny, J.
(eds), The Emergence of Social Enterprise. Routledge, London & New York, 128.
Defourny, J. & Nyssens, M. (2006) Defining social enterprise, in Nyssens, M. (ed.),
Social enterprise. Routledge, Abingdon.
Demos Helsinki (2010) Parempi diili. Available at: http://www.demoshelsinki.fi/julkaisut/
(viewed 13.8.2014).
EMES International Research Network (2014) www.emes.net
EU (2013) Social economy and social entrepreneurship Social Europe guide Volume 4.
Publications Office of the European Union, Luxembourg.
Galera, G. & Borzaga, C. (2009) Social enterprise: An international overview of its
conceptual evolution and legal implementation. Social Enterprise Journal, 5 (3), 210228.
Innopakki - kytntlhtisen innovaatiotoiminnan ksikirja (2012) Available at:
www.lut.fi/innovation
Johnstone, K. (1979) Impro. Improvisation and the theatre. Methuen Drama, London.
Melkas, H. & Harmaakorpi, V. (eds) (2012) Practice-based innovation: Insights, applications
and policy implications. Springer, Berlin & Heidelberg.
Mnkknen, K. (2013) Dialogisuus - hyv sana, mutta vaativa laji, presentation at the
National Meeting for Social Work for Adults 21.5.2013. Website:
http://timelessflow.wordpress.com
Playbook for strategic foresight and innovation (2013) Available at: www.lut.fi/innovation
Scharmer, O. & Kaufer, K. (2013) Leading from the Emerging Future - From Ego-System to
Eco-System Economies. Berrett-Koehler Publishers, San Francisco.
Sveiby, K.-E. & Skuthorpe, T. (2006) Treading lightly the hidden wisdom of the worlds
oldest people. Allen & Unwin, Australia.
Ty- ja elinkeinoministeri (2011) Yhteiskunnallisen yrityksen toimintamallin kehittminen.
Online publication. Available at: www.tem.fi/files/29202/4_2011_web.pdf
Yhteiskunnallisen yritystoiminnan tutkimusverkosto FinSERN (2014) www.finsern.fi

38

The innovation book for social enterprises

furthers the cause of sustainable development
and holistic innovation. It is aimed at everybody
interested in social enterprises. The book
is intended to raise questions and thoughts,
rather than provide answers. It is meant to
inspire and encourage. Hopefully it will also
increase understanding of social enterprises
and their importance for readers who are not
yet that familiar with the concept.