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By Jenni Inglis Extract from

Does it matter whether or not there is a business model for the 21st Century? As Einstein said: “We cannot solve our problems with the same thinking we used when we created them”. At their best, social enterprises create and apply new thinking- they develop new business practices, change consumption patterns, deliver services to diverse communities, include the excluded, and tackle the root causes of problems. For public institutions it can be hard to get beyond thinking that competition is an end in itself, that public value is decided by the efficiency of converting inputs to outputs, and that social enterprises are simply an interest group. Nonetheless, changes are taking place, with some developing new approaches to commissioning in search of better public value. These public service innovators are helped by Government’s promotion of social enterprise in public service delivery, but are also hindered by confusion in practical guidance and apparent conflicts within the range of agendas the public sector pursues. When SEEM set up the BEST Procurement Development Partnership in 2004, we provided some resource to our Partners- the innovators in the public sector and social enterprise movement- to find routes through the policy and practice jungle. We also worked with public sector staff who were externalising services to new social enterprises and being expected to take risks for reward to the public sector. We learned that reassessing what is valued in a competition is insufficient to take advantage of the true potential of the social enterprise business model. It is also necessary to create solutions together- a joined up business model needs a joined-up customer! Along the way Partners had many questions, which this guide answers. It does not advocate one approach, but covers a broad range of topics in a practical way. For those looking for new solutions it offers better paths through the current commissioning frameworks. It can also help today’s social enterprises understand what they can do. The message to Government is that to accelerate the progress of innovators in the public sector and social enterprises there is a need to: • see social enterprises as a public value partner and include them in Sustainable Community Strategy planning and market testing; • move on from debating the legitimacy of “social issues in contracts” to recognising that public value creation crosses over administrative boundaries, and encourage commissioners to look for opportunities to achieve greater social outcome; • make use of pilots, the “small lots” concession, and research and development contracts to support innovation and high public value service models; and • put in place a programme for changing how value for money is used to fully consider outcomes, and improve understanding of how “user need” applies. It matters greatly that new ways of doing business are developed for the 21st Century - new thinking is required to meet the challenges ahead, thinking that public value innovators in social enterprise and in the public sector are already trying to do. Jennifer Inglis Head of Policy, Social Enterprise East Midlands

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