Rural Social Enterprises’ Performance Improvement: An Assessment of their Social Impact Measurement and Critical Success Factors’ Interrelationships with Performance. Implications for Practice and Research

Abstract

<p>The field of social entrepreneurship has a limited focus on rural areas, and on developing countries. This particularly applies to the study of Social Enterprises (SEs) that address rural areas (RSEs). Rural areas are disproportionately affected by intractable challenges such as poverty and inequality. In addition, they suffer from significant organisational management challenges, which constrain management and performance of enterprises including SEs generally and RSEs in particular.</p> <p>Analysis and reporting of the performance of SEs, including RSEs, has been criticised as lacking in rigour. A theme of positive, favourable narratives based on an appeal to universally applauded values has provoked commentators and scholars to advocate critical and rigorous analysis. Analysis of the performance of SEs, including RSEs, is dominated by qualitative methods. There are calls for quantitative and theory driven management research to project SEs' outcomes and enable generalised approaches to improving their performance.</p> <p>In response to these needs, this PhD's overall objective is to advance empirical analysis of the performance of SEs for improved Social Enterprise management, operation, and impact. Three specific objectives are targeted: 1) to evaluate RSE performance measurement methods" 2) to conduct an empirical evaluation of an RSE's performance" and 3) to identify and assess Critical Success Factors (CSFs) that influence RSE performance. Achieving these objectives is documented in six separate but interrelated manuscripts: the first three contribute to achieving objectives 1 and 2 while the remainder enable the achievement of objective 3. Both secondary information and primary data were used. Several analytical techniques were applied. Qualitative data were analysed using Content Analysis, while quantitative data were addressed by Propensity Score Matching, network-Data Envelopment Analysis, Structural Equation Modelling and Importance-Performance Map analysis.</p> <p>First, a systematic literature review comprising 21 RSE studies with 26 RSE cases was conducted. It is the first review, to the author's knowledge, to focus on RSEs' social impact measurement methods" and this complements existing systematic literature review research on SEs. Second, based on the findings of the review, data were collected in rural Uganda: a case of a developing country with a large marginalised rural population. This employed a random sample (n=1021) of smallholder farmers who are both beneficiaries and nonbeneficiaries of RSEs, complemented by a focus group discussion with community leaders and RSEs' beneficiaries. This provided the basis for an analysis of the RSE's impact.</p> <p>The identification of RSEs' CSFs drew first on mainstream business and management literature and limited available SE research, then proceeded to a case study comprising semistructured interviews with managers of six purposively selected RSEs. This was complemented by focus group discussions with three purposively selected RSEs in which RSE beneficiaries and community leaders were also engaged in the identification of CSFs. Based on the foregoing, a survey of 521 RSEs was then conducted to assess relationships between CSFs and RSEs' performance.</p> <p>The results of the systematic literature review revealed that the literature on social impact measurement of RSEs is sparse and relatively new. It confirmed that it is dominated by case studies and qualitative analysis. A variety of definitions of social impact are featured, which together with an apparent lack of rigour and attribution of impacts, limits the usefulness of the available analysis to RSE managers. The literature is also overwhelmingly positive about the impact of RSEs, despite little use of objective comparison methods. </p> <p>The household survey results are used to identify predictors of RSE participation, and of positive social impacts of the RSE's interventions on smallholder farmers' wellbeing. Quantitative analysis of the household survey results further reveals differences in the wellbeing of the RSE's beneficiaries in that females' and youths' wellbeing are high as compared to those of males. These differences are not easily detected at an aggregate level, and so beneficiaries are revealed to be not a homogenous group. This leads us to advocate diversity/class analysis approaches and a diversity/inclusion perspective, to enable finegrained understanding of the relationship between RSEs' performance and impact on beneficiaries. Qualitative evaluation of the interventions reveals aspects of the RSE's interventions that require attention for achieving and sustaining social impacts. </p> <p>The interviews with managers, and the focus group discussions, identified a total of 40 CSFs, categorised as internal and external. Based on the relevance/manageability matrix, eight internal CSF general element categories were identified, and priorities for managers' action assigned. The survey of 521 RSEs revealed interesting findings on two fronts: first on the interrelationships amongst internal CSFs (entrepreneurial orientation, social salience and business planning), and RSEs' financial and social performance)" and second on the interrelationships amongst external CSFs (financial support and training support), and internal CSFs (business planning) and RSEs' financial and social performance. For the former relationships, we find that entrepreneurial orientation and business planning are critical to RSEs' performance, and that business planning mediates the relationship between entrepreneurial orientation and financial and social performance. The latter relationships reveal business planning and training support as key influencing CSFs for improving financial and social performance. To the authors' knowledge, this is the first quantitative study to focus on RSEs' CSFs in a developing country, and in the rural context.</p> <p>This collection of manuscripts contributes to knowledge and methods vital for researchers interested in advancing RSE performance. The manuscripts also offer guidance for RSE practitioners and supporters, and for the makers of policy for developing countries' rural settings. Finally, the manuscripts each advocate future research directions. </p>