Digital Social Innovation: Understanding business models across private sector, social enterprise and non-profit organisations

In this post I briefly outlines my plans for a research study of the business models that support and enable digital social innovation, as part of my broader ESRC funded fellowship project. As ever I am seeking to work in open and transparent manner, and I will continue to post updates on my blog as my research develops. I very much welcome feedback on this research outline, so please do get in touch with thoughts, comments and suggestions. Also if you are working on a digital social innovation and would be interested in participating in the research it would be great to hear from you.

Digital Social Innovation

Rapid advances in digital technologies are opening up new possibilities to catalyse social change, or in other words there are rapidly growing opportunities for digital social innovation. At its heart a digital social innovation is the novel application of digital technologies to better address a social need and to empower members of society[1] (The Young Foundation, 2012). Digital social innovations can emerge from any sector of the economy or from civil society, and seek to address major social needs such mitigating climate change, reducing social exclusion, improving education and access to knowledge etc. Examples include Wikileaks, Raspberry Pi and Kickstarter, but in a short research outline it impossible to do justice to breadth of innovative activity currently taking place.  Rather the Nominet Trust’s list of 100 of “The World’s Most Inspiring Social Innovations Using Digital Technology” remains an excellent resource for exploring the current and potential impact of the digital social innovation.

Research scope

In this research study I will explore the business models that underpin and enable the development of digital social innovations; defining a business model as describing how and why an organisation creates, delivers and captures social (and in some cases economic) value. The study will focus on the business models of private sector, social enterprise and non-profit organisations, and explore four interrelated themes as follows.

• Motivations for and mechanisms of social value creation - seeking to understand how organisations: formulate their social and customer value propositions, make the trade-offs (e.g. between social value creation and the financial position of the organisation), respond to competitive and collaborative dynamics, and evaluate and manage their social impact (including any potential downsides of their activities). 
• The system of activities orchestrated by organisations (Zott and Amit, 2010) - seeking to understand: which activities organisations include within their business models (e.g. developing web platforms, developing communities of users ...); how collaborators, customers and co-producers are involved in these activities; and which activities are central to business models for digital social innovation.
• The resources models of organisations – seeking to understand how organisations develop and draw up on financial, social (e.g. networks of contacts), cultural (e.g. skills and knowledge) and symbolic resources (e.g. the social purpose of the organisation) to develop digital social innovations.
• Patterns in business model design – seeking to understand the dominant drives of value creation in digital social innovation, and how business models designs vary with organisational scale and across sectors.

Research outputs

The research programme outlined in this document will deliver three key outputs: (1) two academic journal papers reporting the findings of the research; (2) a report for policy-makers and funders with interests in promoting digital social innovation, presenting evidence on the types of business models that enable digital social innovations to emerge, become sustainable and scale up; (3) a toolkit to support organisations and entrepreneurs engaged digital social innovation to review, design or re-design their business models.

Research approach

The research approach consists of two phases: first, a pilot project, the findings of which will inform the design and execution of a second larger scale phase research activity. The table below provides a high-level view of the timescales for the research. The pilot project will focus on better understanding the business models of organisations engaged in digital social innovation, which in turn will inform the design of the 2^nd phase of research. During the pilot project I will conduct semi-structured interviews with members of organisations engaged in the practice of digitally-mediated social innovation.  

Phase 1: pilot study
Research design for the pilot research project	March 2014
Data collection (approx. 5-10 interviews with members of organisations)	April – May
Data analysis	June
Reporting findings of pilot phase	July
Phase 2: larger-scale study	August 2014 – May 2015

References

THE YOUNG FOUNDATION 2012. Social Innovation Overview: A deliverable of the project: “The theoretical, empirical and policy foundations for building social innovation in Europe” (TEPSIE), European Commission - 7th Framework Programme Brussels.

ZOTT, C. & AMIT, R. 2010. Business Model Design: An Activity System Perspective. Long Range Planning, 43, 216-226.

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[1] This description of the nature of digital social innovation draws upon the work of the TEPSIE project that seeks to establish empirical and theoretical foundations for the study of social innovation.