Innovation Performance of Social Enterprises: An Empirical Study in India

Abstract

Social enterprises pursue innovation to create socio-economic impact for the marginalized communities. The founders of social enterprises drive goal-oriented innovation, whereas, interactions with ecosystem is crucial to create and diffuse innovation. However, studies are scant on creation as well as diffusion of innovation emerging from social enterprises. This paper attempts to understand innovation emerging from social enterprises through an exploration of innovation focus, interactions with ecosystem, and measurement of innovation performance. A cross-sectional study is performed to understand the relationship between founders' orientation and innovation performance, and the mediating role of innovation focus and ecosystem interactions. A cluster sampling across four states in India - Karnataka, Telangana, Maharastra and Tamil Nadu - resulted in participation from 207 social enterprises. The results of partial least squared structural equation modeling (PLS-SEM) demonstrate the positive complementary mediating role of innovation focus in the relationship between founders' orientation and innovation performance. Moreover, this paper illustrates that founders' persistent focus on innovation creates positive results for social enterprises as well as beneficiaries.