Journal of Health Organization and Management

Social enterprise in health organisation and management: hybridity or homogeneity?

Ross Millar
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Ross Millar, (2012),"Social enterprise in health organisation and management: hybridity or homogeneity?",
Journal of Health Organization and Management, Vol. 26 Iss 2 pp. 143 - 148
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NEW PERSPECTIVES Social enterprise

in health
Social enterprise in health
organisation and management:
143
hybridity or homogeneity?
Ross Millar
Health Services Management Centre, University of Birmingham,
Birmingham, UK

Abstract
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Purpose – The purpose of this paper is to reflect on social enterprise as an organisational form in
health organisation and management.
Design/methodology/approach – The paper presents a critique of the underlying assumptions
associated with social enterprise in the context of English health and social care.
Findings – The rise of social enterprise models of service provision reflects increasingly hybrid
organisational forms and functions entering the health and social care market. Whilst at one level this
hybridity increases the diversity of service providers promoting innovative and responsive services,
the paper argues that further inspection of the assumptions associated with social enterprise reveal an
organisational form that is symbolic of isomorphic processes pushing healthcare organisations toward
greater levels of homogeneity, based on market-based standardisation and practices. Social enterprise
forms part of isomorphic processes moving healthcare organisation and management towards market
“norms”.
Originality/value – In line with the aim of the “New Perspectives section”, the paper aims to present
a provocative perspective about developments in health and social care, as a spur to further debate and
research in this area.
Keywords England, Health organization and management, Health care, Social enterprise, Hybridity,
Health and social care, National Health Service, Isomorphism
Paper type Viewpoint

Introduction
Over recent decades, policy developments in public sector reform have increasingly
emphasised the decline and fragmentation of established welfare bureaucracies. This
disaggregation and decentralisation of services has led some to suggest that service
provision is becoming increasingly “hybrid” as established sectors and boundaries
come together. Health and social care has been a key area for such changes. The
promotion of competition and choice has led to an increasing emphasis on private and
third sector providers entering the healthcare market. These providers have been
encouraged on the grounds that they are capable of being more innovative and
responsive than their public sector counterparts (Allen, 2009).
The English healthcare system has been particularly active in encouraging a Journal of Health Organization and
diversity of providers. One such organisational model of provision has been social Management
Vol. 26 No. 2, 2012
enterprise, which has been encouraged as a more innovative and responsive alternative pp. 143-148
for service users and healthcare staff. Social enterprises are broadly defined as q Emerald Group Publishing Limited
1477-7266
“business[es] with primarily social objectives whose surpluses are principally DOI 10.1108/14777261211230817
 JHOM reinvested for that purpose in the business or in the community, rather than being
26,2 driven by the need to maximise profit for shareholders and owners” (Department of
Trade and Industry, 2002).
In England, social enterprises are currently presented as organisational vehicles
with the potential for dealing with complex social needs that create social as well as
economic capital. This resonates with global trends that have seen governments invest
144 significantly in social enterprise organisations to deliver public services (e.g. Defourny
and Nyssens, 2008). In the following New Perspectives essay I want to argue that this
increasing interest in social enterprise in health organisation and management reflects
wider trends in welfare that draw attention to increasingly hybrid organisational forms
and functions. Following this, I also want to challenge this notion of hybridity, arguing
that whilst social enterprise increases diversity in our understanding of health
organisation and management, its rise and increasing popularity is illustrative of
isomorphic processes towards market “norms”. Social enterprise is symbolic of
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isomorphic processes pushing healthcare organisations toward greater levels of

homogeneity based on market based standardisation and practices.

Background
Policy makers are increasingly using social enterprise as a discursive vehicle to
address a wide range of social problems (Teasdale, 2011). Nicholls (2010) explains that
the organisational legitimacy of social enterprise has been as the result of a dynamic
interplay between macro-level institutional structures and micro-level organisations. In
the UK, network organisations like the Social Enterprise Coalition (SEC) represent
“paradigm-building” actors that have been influential in establishing discourses and
narratives to develop ideas about social entrepreneurship (Nicholls, 2010, p. 616). They
draw attention to how social enterprises are an attractive proposition in providing
“value-added” services better able to more effectively mobilise “pro social behaviour”
than for-profit private enterprises (e.g. Allen, 2009).
In the English National Health Service, a variety of policy initiatives have
encouraged social enterprises with the aim to create patient choice and give greater
freedom to staff to be innovative, responsive and improve quality. For example, a
Social Enterprise Investment Fund (SEIF) was established to support the development
of new enterprises and encourage existing social enterprises to extend into delivery of
health care (Millar et al., 2010). In the primary and community health sector, social
enterprises were one of the organisational forms that could be considered under the
Transforming Community Services programme (Department of Health, 2009). As part
of a purchaser-provider split, primary care commissioning organisations (PCTs) were
required to transfer their provider services to other organisations by 2012. This policy
commitment was highly significant in that NHS employees were to be given a “Right to
Request” (RtR) to set up social enterprise organisations to deliver community health
services (Miller et al., 2012). The RtR programme has been followed in England by a
Mutuals Programme to support 20 services to develop into “public sector mutuals”,
and the Right to Provide programme encouraging staff within healthcare trusts to
become social enterprises.
Existing research in this area has reported some notable benefits in becoming a
social enterprise. This included greater innovation in clinical service delivery; the
provision of a wider range of services; and efficiency savings from reduced staff
 absence (Miller et al., 2012; Hall et al. 2012; National Audit Office, 2011). These findings Social enterprise
also support wider research about non-profit organisations in healthcare settings in health
suggesting that they achieve better relations with those they serve; enhance quality
and deliver more innovative service provision (e.g. Heins et al., 2010; Department of
Health, 2009). That said, research also identifies challenges associated with social
enterprise entry. Miller and Millar (2011) found only limited interest expressed by NHS
staff to develop social enterprises due to a lack of staff support, leadership, 145
organisational support and commissioning support. Commissioners have been
highlighted as particularly problematic in often equating social enterprise
organisations with being “not business-like enough” (Baines et al., 2010). Workforce
concerns regarding job security, business skills and the potential loss of public sector
branding have also been documented (Department of Health, 2010), as well as the
difficulties in measuring anticipated benefits and securing funding from financial
institutions and commissioners in a competitive market place.
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Social enterprise: hybridity or homogeneity?

Social enterprise has been discussed and researched in the health and social care
context but as yet the debates surrounding their entry have not been extended to
analyse how social enterprises interact with other public and private sectors. It has
been documented elsewhere of a “tension field” as different sectors and boundaries
interact and become increasingly porous and overlapping (Evers and Laville, 2004).
Billis (2010), for example, suggests that this hybridity represents an expanding aspect
of the complex and overlapping relations between the state, the market and the third
sector that is challenging and supplanting the core features, and values, of established
welfare institutions. As a result of contracting out, privatisation and performance
measurement, the traditional boundaries between market, state and third sector have
been breaking down, leading to the emergence of a class of organisational hybrids:
complex organisations with opaque accountability structures. Here, Billis (2010)
argues that a prominent example of welfare hybridity is social enterprises that fuse
third, public and private sector values. Such organisations are indicative of existing
third sector organisations in health and social care that are now introducing social
enterprise “trading arms” as part of their organisation. They are also indicative of
changes to health care organisations currently operating within the public sector. For
example in England we have seen the introduction of hospital Foundation Trusts that
aim to combine public sector with private and third sector approaches (Allen et al.,
2012).
Social enterprises represent the arrival of new hybrid organisational forms in health
organisation and management. Whilst these organisations are associated with greater
innovation and responsiveness, they also represent a response to the current pressures
faced by healthcare organisations to reform and adopt managerial principles grouped
under the umbrella of new public management (NPM). As Brown et al. (2003) suggest,
these managerial principles are aimed at changing the public sector in three areas,
summarised by Maor (1999) as first, a change from hierarchical to economically based
structures, second from regulative to economically based processes and third, from
legally based to economically based values. In seeking to achieve these goals, the
existing healthcare sector is being required to downsize, devolve managerial
 JHOM responsibility and introduce managerialist methods and practices from the private
26,2 sector.
Social enterprises represent a hybrid organisational form that is symptomatic of
this convergence towards NPM ideas and practices. When we start to reflect on debates
about the nature and implications of this hybridity, current thinking about hybridity as
a concept tends not to extend beyond the “tension field” as depicted by Evers and
146 Laville (2004). A critical reflection on these developments in healthcare suggest that
social enterprise is indeed symptomatic of this hybridity but perhaps the
organisational form is also symptomatic of increasing homogeneity: a convergence
and blurring of sectoral boundaries that represents a market based isomorphism
currently taking place in health organisation and management. It was DiMaggio and
Powell (1983) who most famously described the three processes of isomorphic
behaviour. These are coercive isomorphism that stems from political influence and the
need for legitimacy, mimetic isomorphism resulting from standard responses to
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uncertainty, and normative isomorphism associated with professionalisation.

DiMaggio and Powell (1983) suggest that the product of coercive, mimetic, and
normative isomorphism reflected an increasing homogenisation and convergence of
organisational forms fuelling standardisation and professionalisation.
It has been documented elsewhere how the appeal of the third sector is based on its
ability to bridge government and civil society yet problems remain for these
organisations in becoming social enterprises. The dangers of the increasing influence
of adjacent sectors, the loss of independence and possible mission creep in which these
organisations gain resources, possible influence and the opportunity to deliver more
services come at the cost of those fundamental attributes which made it an attractive
proposition in the first place – its mission, values and voluntary contribution (Haugh
and Kitson, 2007). Kelly (2007) suggests this blurring of sectoral boundaries has
usually been regarded either as a cause or as the effect of a process of structural
isomorphism in which non-profit organisations have become increasingly
bureaucratised and commercial. Mimetic isomorphic forces are also at play as the
organisation becomes increasingly professionalised as it is continuously required to
adopt business methods that are likely to impact on the rationale and culture of the
organisations.
The rise of social enterprise in the context of market-based isomorphism also
reflects how existing public sector healthcare institutions are susceptible to mimetic,
normative, and coercive pressures as much as business and non-profit sectors.
Research has tended to view public sector agencies more as playing the role of catalyst
to institutionalisation in other organisations, as forces pushing non-profits and
business firms toward greater levels of homogeneity. As Frumkin and Galaskiewicz
(2004) suggest, these same organisations are also being subject to the same kinds of
pressures. This vulnerability of public sector organisations to isomorphic pressures is
particularly significant as governments tend to be the principal funder of non-profit
service delivery. With increasing amounts of non-profit agency finance flowing from
public sector agencies (such as the Social Enterprise Investment Fund in England), the
vulnerability of government agencies to institutional pressure may have effects on the
scope and character of contracting relations. One effect might well be a narrowing of
the range of innovations that government agencies are willing to consider under
conditions of uncertainty (Frumkin and Galaskiewicz, 2004). This could in the long run
 have serious implications for the diversity of non-profit initiatives such as social Social enterprise
enterprise and might well be in tension with the drive for social innovation that is in health
commonly associated with these organisational forms.

Concluding remarks
In DiMaggio and Powell’s (1983) classic article, the “norm” was the bureaucratic
organisation of Max Weber. What we are seeing now is the norms changing towards 147
market forms of organisation. In this New Perspectives essay I have argued that the
rise of social enterprise is indicative of increasingly hybrid forms of organisation in
healthcare delivery. What I have also argued is that within these hybrid arrangements
we are seeing increasing diversity in service provision but we are also seeing an
increasing convergence and homogeneity of organisational forms. Social enterprise
organisations are symptomatic of the requirement to converge around a market based
isomorphic process that is requiring the third sector and the public sector to converge
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around managerialist methods and practices fuelling standardisation and

professionalisation.

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Further reading
Peredo, A.M. and McLean, M. (2006), “Social entrepreneurship: a critical review of the concept”,
Journal of World Business, Vol. 41 No. 1, pp. 56-65.

Corresponding author
Ross Millar can be contacted at: r.millar@bham.ac.uk

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