Politics of social enterprises: The role of influential people in scaling up

Abstract

In developing countries, social enterprises face an imperative to scale up their services in order to extend their reach to a larger number of beneficiaries. However, only a few social enterprises are able to successfully scale up and most of them remain restricted as a small localized initiative. One of the most important reasons for inability to scale up is the complex environmental dimensions of the developing country context, such as political dynamics, distinct socio-cultural aspects, and resource constraints. Extant research has shown the importance of organizations’ political connectedness for the organizational performance in commercial for- profit organizations. The social enterprises, however, require establishing political connections for a social cause, rather than for obtaining a competitive advantage over peers or for enhancing the financial performance. In this study, through an empirical investigation into four scaled up social enterprises involved in delivering affordable health care services for the underprivileged in India, we attempt to explore (1) how social enterprises’ build connections with influential people and (2) how these connections facilitate the process of scaling up. We emphasize the importance of connections with external influential people, which can enable the social enterprises to navigate the hurdles in the process of scaling by achieving alignment of social, economic and political dynamics and by providing access to key resources. The study contributes to the social entrepreneurship literature by providing useful insights on processual aspect of the relationship between organizations’ connections with influential people and scaling up of social enterprises in a developing country context.