Business models & social innovation: mission-driven versus profit-driven organisations

Abstract

The innovation demand placed on both profit-driven and mission-driven organisations is steadily rising in the face of changing technological and social paradigms, set against a generalised atmosphere of fiscal austerity. Hence, mission-driven organisations have undergone a series of transformations in order to find new revenue streams and to better serve their beneficiaries. These transformations are apparent in the area of social innovation, which is characterized by its search for new ways of financing solutions to cope with societal challenges. As mission-driven organisations adopt profit-driven strategies and for-profit organisations adopt mission-driven strategies, they each take on new and sometimes borrowed characteristics, evolving into hybrid organisations.Social innovation research is increasingly devoted to distinguishing features of mission-driven and profit-driven organisations. In fact, we can learn more about mission-driven organisations by looking through the lens of social enterprise. This article contributes to the ongoing debate of mission-driven organisations by analysing how new forms of business models combining mission-driven and profit-driven logics and features are designed and shape organisational behaviour in the field of social innovation. Results illustrate that while mission-driven organisations are often prompted to use models, tools and logics coming from the for-profit sector, more emphasise should be placed on output-oriented models and tools that support the specificities of their business models.