Anyone wanting to start a business in the United States today needs to consider the current political environment. The current political setting struggles with gridlock and inability to accomplish anything. Because of this setting, companies have a hard time finding capital and getting any support from the government. The current climate favors large multinational companies and not small business. Government lacks the ability to hear a strong central voice from small businesses because the political parties have splintered the voice of small business (Young, 2008).
Government and business does not work together because of many lingering scandals and the breakdown of the regulatory process. Some businesses complain of overregulation and other groups call for improved regulation to prevent more scandals. Government and business needs to find a better balance to improve conditions for business while protecting concerns of other Americans such as investors, homeowners, and labor.
Despite these conditions small businesses account for 99.7% of businesses and 50.7% of employees in the United States (Ide, 2009). The power of small business is great only if the people running small businesses can mount a unified voice. The political parties want to prevent small business from having such a voice and work to divide small businesses much like the general population.
Although the conditions for small business in the United States are grim, the prospect for social entrepreneurs is bright. Bull, Ridley-Duff, Foster, and Seanor (2010) argued the current market economy ideology favors self-interest and avoids moral virtue. Bull et al. believed a gap for socially and environmentally friendly firms exists in the market blending charitable and private enterprise. Korsgaard (2011) suggested social entrepreneurship comes from diagnosing social problems and finding solutions to them. Social entrepreneurs must have creative skills to innovate solutions to societal problems.
A look at societal social problems from the outside in can help gain a fresh perspective to gain insight to solving such problems. In the United States, many people fear starting a company to deal with these issues because of the recession. Someone with an outside perspective and some creativity may have a better opportunity to diagnose problems and find ways to deal with them.
Williams and Nadin (2011) argued social entrepreneurship emerges from a lack of choices in dealing with social issues by disadvantaged populations. Williams and Nadin noted people have both commercial and social needs. Government neglects the social needs because of dwindling budgets. Private companies that want to deal with social needs last because they value profits first (Harris, 2013).
Political polarization has not helped find a place for social entrepreneurs because government does not want to take on new social issues because of shrinking tax revenues. The political setting supports privatization instead leaving a place for the social entrepreneur to deal with such issues (Harris, 2013).
The American economy welcomes a place to deal with social entrepreneurship. Independent social entrepreneurs fill this void by using market mechanisms. Marshall (2011) cast the social entrepreneur as a unique person wanting to satisfy a social mission, while making a profit. The social entrepreneur deals with issues unfulfilled by commercial organizations.
A company wanting to do business in the United States should consider the merits of social entrepreneurship. A multitude of problems exist with an opportunity to fill unmet societal needs and make a profit. Despite the grim prospects for commercial entrepreneurship, opportunities in social entrepreneurship have a bright outlook. Considering the political and economic environment social entrepreneurship stands out from other enterprises under current conditions.
J. Phillip “Phil” Harris, D.B.A.Dr. Harris is the founder and principal of Acclaimed Professionals Group. Dr. Harris is an experienced business entrepreneur, a certified public accountant, and teaches at the University of Phoenix. He is also a member of Delta Mu Delta honor society and has a Masters of Business Administration in finance.
Bull, M., Ridley-Duff, R., Foster, D., & Seanor, P. (2010). Conceptualising ethical capital in social enterprise. Social Enterprise Journal, 6(3), 250-264. doi: 10.1108/17508611011088832
Harris, J. P. (2013). Social entrepreneurship as justified by globalization. Paper presented at the AIB-SE Conference 2012, Ft. Lauderdale, FL.
Ide, T. (2009). How to rectify unfair trade practices and to establish appropriate supply chains and better business culture under the global market economy. Pacific Economic Review, 14(5), 612-621. doi: 10.1111/j.1468-0106.2009.00475.x
Korsgaard, S. (2011). Opportunity formation in social entrepreneurship. Journal of Enterprising Communities: People and Places in the Global Economy, 5(4), 265-285. doi: 10.1108/17506201111177316
Marshall, R. S. (2011). Conceptualizing the International For-Profit Social Entrepreneur. Journal of Business Ethics, 98(2), 183-198. doi: 10.2307/258091.1988-37513-00110.2307/258091 10.1007/s10551-010-0545-7
Williams, C., C., & Nadin, S. (2011). Beyond the commercial versus social entrepreneurship divide: Some lessons from English localities. Social Enterprise Journal, 7(2), 118-129. doi: 10.1108/17508611111156592
Young, M. (2008). The political roots of small business identity. Polity, 40(4), 436. doi: 10.1057/pol.2008.20