Reverse Social Innovation: Theoretical Perspective and Empirical Evidence (Contributions to Management Science) 3031482468, 9783031482465

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Contributions to Management Science

Lorenza Claudio

Reverse Social Innovation

Theoretical Perspective and Empirical Evidence

Contributions to Management Science

The series Contributions to Management Science contains research publications in all fields of business and management science. These publications are primarily monographs and multiple author works containing new research results, and also feature selected conference-based publications are also considered. The focus of the series lies in presenting the development of latest theoretical and empirical research across different viewpoints. This book series is indexed in Scopus.

Lorenza Claudio

Reverse Social Innovation Theoretical Perspective and Empirical Evidence

Lorenza Claudio Parthenope University of Naples Naples, Italy

ISSN 1431-1941 ISSN 2197-716X (electronic) Contributions to Management Science ISBN 978-3-031-48246-5 ISBN 978-3-031-48247-2 (eBook) https://doi.org/10.1007/978-3-031-48247-2 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors, and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland Paper in this product is recyclable.

Preface

Within the international scenario, we are increasingly witnessing a unique way of doing innovation. Nowadays, we can find innovations with peculiar characteristics, i.e., designed in emerging countries to solve social problems and that—later—spread to advanced countries. This process involves an inversion of the diffusion flow if compared to the traditional paradigm. Therefore, these innovations simultaneously have the nature of both reverse innovation (RI) and social innovation (SI). The first identifies innovations that spread from less advanced to more advanced countries, while the latest innovations have a solid and clear social connotation. This new phenomenon is defined as reverse social innovation and is still completely unexplored in the literature. Reverse social innovation refers to innovations linked to fulfilling social needs applicable in different contexts: from the less advanced where they originate to the more developed. Moreover, maintaining the social character during the reverse flow of diffusion is a distinguishing feature of this innovation. Following an explorative approach, this monograph aims to investigate which factors impact social reverse innovation and, thus, how social innovation, reversing its flow, spreads from the emerging country where it has been created to an advanced one. The study identifies two strands in the literature, both emerging and unrelated, namely reverse innovation and social innovation. Through the existing literature, a conceptual framework was developed. This model identifies three factors: contextspecific, firm-specific, and social goal. Subsequently, the conceptual framework has been validated, adopting an abductive empirical analysis carried out with mixed methodology: firstly, using a multiple case study. Notably, the first case study concerns a reverse social innovation in the emerging phase of its diffusion process; the second regards a reverse social innovation in progress, and the third is a reverse social innovation in an advanced dissemination phase. The qualitative analysis was carried out with secondary data (documentary materials). Further, the second methodology adopted was a content analysis, developed on the interviews conducted with leading exponents for each firm. The research v

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Preface

confirmed the importance of some of the factors previously identified, not only about the conception phase but also about the dissemination of innovation. Especially the results validate the focal role of the “context-specific factors,” highlighting the extent to which the presence of common social needs in both the context of origin and the host market facilitates the replicability of a particular product/service in geographically distant markets. The study also corroborates the usefulness of the so-called “firm-specific factors,” which include the firm’s previous experience and innovative capabilities. Lastly, for what concerns the box “social goal,” the analysis validates the relevance of all previously postulated elements (stakeholders’ involvement, social and global benefits, and know-how transferring capabilities). These act as factors facilitating the reversal of the flow of innovations from emerging countries and spreading to advanced ones. Moreover, the interviews allowed us to identify a different typology of factors: “fitting and adaptation factors,” which include specific product/service and brand changes as crucial aspects for a successful reverse social innovation. The initial conceptual framework was, thus, further enriched with this additional typology of factors. In conclusion, the book examined the theoretical and practical implications, outlining possible areas for future research on the reverse social innovation phenomenon, which promises to become progressively more relevant and globally widespread. Naples, Italy

Lorenza Claudio

Competing Interest

The author declares that no funds, grants, or other support were received during the preparation of this manuscript. The author reports no competing interests (financial or non-financial) to declare.

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Contents

1

2

3

Social Innovation and Reverse Innovation: Theoretical Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 A Systematic Literature Review of the Social Innovation Phenomenon . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1.1 The Implementation Phases of a Social Innovation . . . . . . . . 1.2 Systematic Literature Review of the Reverse Innovation Concept . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.3 Results of the Systematic Review . . . . . . . . . . . . . . . . . . . . . . . . . 1.3.1 Different Streams of Social Innovation . . . . . . . . . . . . . . . . 1.3.2 Different Streams of Reverse Innovation . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Emergence of Reverse Social Innovation: Reasoning About the Shaping Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.1 The Standing Out of a New Concept: The Reverse Social Innovation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.2 The Impact of Economic and Social Circumstances: The “Context-Specific Factors” . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3 How Firms’ Characteristics Affect a Reverse Social Innovation: The “Firm-Specific Factors” . . . . . . . . . . . . . . . . . . . 2.4 The Influence of “Social Goals”: Connecting the Social and Reverse Phenomena . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5 The Reverse Social Innovation Conceptual Framework . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1 1 8 13 20 24 24 26

. 31 . 31 . 32 . 38 . 39 . 41 . 42

Reverse Social Innovation: Comparative Analysis of Multiple Case Studies, Unveiling Practical Patterns and Insights . . . . . . . . . . . . . . . . 3.1 The Methodology and the Research Design . . . . . . . . . . . . . . . . . . 3.1.1 A Qualitative Approach: A Multiple Case Study Analysis . . 3.1.2 Selection of Case Studies . . . . . . . . . . . . . . . . . . . . . . . . . . 3.1.3 Semi-Structured Interviews . . . . . . . . . . . . . . . . . . . . . . . . . 3.2 “Chola AaRoVi”: An Emerging Reverse Social Innovation . . . . . . .

45 45 47 49 51 52 ix

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Contents

“Drive-Through” and “Walk-Through”: A Reverse Social Innovation in Progress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3.1 The Drive-Through and the Walk-Through and Their Reversal of the Flow . . . . . . . . . . . . . . . . . . . . . . 3.4 “Grameen Bank”: An Established Reverse Social Innovation . . . . . . 3.4.1 The Reversal of the Diffusion Flow of the New Banking Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.3

4

Content Analysis and the Development of a Conceptual Model . . . . . . 4.1 Content Analysis and Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2 Building the New Conceptual Model: An Analysis of Factors Affecting a Reverse Social Innovation . . . . . . . . . . . . . . . . . . . . . . 4.2.1 “Context-Specific Factors”: A Validation of Previous Evidence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2.2 “Firm-Specific Factors”: A Revised Version of Foregoing Assumptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.2.3 The Endorsement of the Antecedent “Social Goal” . . . . . . . . 4.2.4 The Arising of New Items: “Fitting and Adaptation’s Factors” . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.3 Designing the New Reverse Social Innovation Conceptual Model . . 4.4 Conclusions, Implications, and Limitations . . . . . . . . . . . . . . . . . . . References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

55 56 58 59 61 63 63 69 69 72 72 74 74 77 78

Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81

Chapter 1

Social Innovation and Reverse Innovation: Theoretical Framework

Abstract A systematic literature review is performed for the Social Innovation and for the Reverse Innovation phenomenon. The aim is to first introduce both concepts separately, deepening the definitions, main characteristics, and peculiarities. Through this analysis of the existing literature, the author clearly presents the principal contributions and the different streams. Finally, by means of a conceptual map, the author highlights the existence of several nodes that represent the intertwining with other concepts. Further, an interesting overlap is presented and discussed: the node labelled “Social Strand”.

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

The label “Social Innovation” was clearly outlined by Mulgan et al. (2007). The authors’ definition is still widely accepted in the existing literature. In accordance with the authors, the definition would include “innovative activities and services motivated by the objective of responding to social needs that are predominantly developed and diffused in organisations whose main purpose is social” (Mulgan et al., 2007, p. 8). Another interesting perspective is presented by Phills et al. (2008), who emphasise the sustainability and inclusiveness of these innovations, which no longer address only private individuals, but society as a whole; on the other hand, their durability over time. Although the interest in the topic is fundamentally multidisciplinary, scholars have long neglected an adequate investigation within the literature (Howaldt & Schwarz, 2010). Indeed, there are still essential deficiencies. According to Montanari et al. (2017), one scantiness concerns the fundamental pillars composing Social Innovation. The authors contribute to the topic by discussing six “building boxes”. According to the authors, the first building box concerns the key characteristics of Social Innovation. These are listed, trying to distinguish social and business innovations. “A first attribute of Social Innovation concerns its focus on finding answers to a wide variety of social needs, particularly of most vulnerable groups (young people, women, migrants, the elderly.)” (Montanari et al., 2017, p. 8). Following this © The Author(s), under exclusive license to Springer Nature Switzerland AG 2023 L. Claudio, Reverse Social Innovation, Contributions to Management Science, https://doi.org/10.1007/978-3-031-48247-2_1

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Social Innovation and Reverse Innovation: Theoretical Framework

is the second box regarding the objectives of the innovation, including the social mission, which—together with the social impact—plays a primary role. The approach adopted constitutes the third building box and represents the means through which the objectives, as mentioned earlier, are achieved. The fourth building box concerns the processual nature of innovation, i.e. all the steps necessary to implement Social Innovation. At the same time, the fifth includes the individuals engaged in managing and regulating innovation. Finally, the sixth box consists of the ecosystem conditions in which the innovation is born and develops, which can facilitate or hinder it (Montanari et al., 2017). Another discussed issue regards the boundaries between Social Innovation and other concepts. An interesting distinction between the social entrepreneurship phenomenon and social innovation concept is pointed out by Perrini and Vurro (2006), who explain that social entrepreneurship concerns the dynamic process implemented by a team or an individual, while Social Innovation is what you want to exploit, employing a robust entrepreneurial mindset, a need for achievement, and lastly, the goal of creating social value for the community. In other words, social entrepreneurship refers to the entrepreneurial path, while Social Innovation refers to the final objective, a product, a service, or an innovative process. Both are linked but represent two different phases with diverse dynamics. Given recent years’ scientific contributions, the concept of Social Innovation emerges as one of the most extensively debated topics within the broader realm of innovation (Canestrino et al., 2015; Dioniso & de Vargas, 2020). The interest is probably due to the potential of meeting needs that still need to be solved by other actors, such as civil society, the government, Non-For-Profit Organisations, and the business community (Dioniso & de Vargas, 2020). Both from a theoretical and policy point of view, the centrality of this topic is ascribed to the actual global crisis. Years ago, people were used to perceiving societal challenges (i.e. sustainability issues or the ageing of Europe) as issues that could restrict economic behaviour. Today, this tendency is shifting towards the opposite direction: societal challenges are perceived as innovation opportunities (European Commission, 2013). Further, in line with the statement of the European Commission (2013), Social Innovation represents a valuable tool to resolve youth unemployment and the ageing population as socio-economic problems. A systematic literature review was performed as the methodology to clarify the primary elements of Social Innovation, the implementation stages involved, and the aspects that remain subject to debate. It will therefore be possible to present the main contributions and highlight the literature gap, i.e. the area of the literature where there are weaknesses and unresolved questions. The systematic literature review was performed via “Scopus”,1 a digital platform collecting abstracts and citations of scientific research. The research strategy applied is depicted in Fig. 1.1. The following keywords were chosen as search queries: “social innovation” and “social innovations”. From this first phase, 5602 papers emerged for each query. Each sample was reduced in number by filtering the results for the following criteria: (1) Search 1

https://www.scopus.com/

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

3

Fig. 1.1 Social innovation literature research strategy. Source: Author’s elaboration

area “business, management and accounting”, (2) Document type “articles”, (3) Source type “journal”, and (4) Language “English”. At this point, the number of publications of each query is reduced to 1005 papers. The export files were merged, and duplicates were cancelled. Indeed, since the results from both queries were the same, the sample included 1005 contributions. Subsequently, in the third phase, the sample included all the contributions with an impact factor greater than 1.5. This criterion is in line with the journal ranking developed by Bouncken et al. (2015) and later developed by Kraus et al. (2020). The sample also included papers published in the first, the second, and the third quartile on Scimago2 (see Fig. 1.2). Now, the sample includes 355 contributions. Given the heterogeneous nature of the subject, the analysis was purposely performed, not applying any restricting criteria regarding the journals and their aim and scope. In order to ensure the presence of different results from a multidisciplinary point of view, any source filter was 2

https://www.scimagojr.com/

Fig. 1.2 Social Innovation Literature: ranking according to Scimago. Source: Author’s elaboration

1

Social Innovation and Reverse Innovation: Theoretical Framework 18 16

NUMBER OF CONTRIBUTIONS

4

14 12 10 8 6 4 2 0

Q1

Q2

Q3

SCIMAGO QUARTILE

selected, such as the journal’s research field. Likewise, the research keeps the inclusion criteria concerning Scimago’s quartile wide, considering the journal ranked Q1, Q2, and Q3 on Scimago. Further, a reduction criterion to the sample was applied, viewing titles and abstracts. Thus, the analysis focused on research that was purely on the theme. For this reason, the book cut out works concerning sustainability, social entrepreneurship, social business models, and others. Another exclusion criterion applied concerns the coherence between the sample and the research aim (53 papers). Last, the full texts were examined: The final selection includes 25 contributions. As the analysis shows, Social Innovations are defined as those whose main objective is, as the label suggests, to fulfil the social requirements of consumers and enhance their overall welfare. The phenomenon encompasses creating novel ideas, products, services, or models to create new social relationships and collaborations (European Commission, 2013). The term “Social Innovation” has been, and still is, highly debated in the literature, especially regarding its definition (Tracey & Stott, 2017). Therefore, Solis-Navarrete et al. (2021) tried to argue about what is and is not Social Innovation. By doing so, they define several vital characteristics: to solve social problems—which many scholars agree on—to generate and apply empirical and scientific knowledge, improve living conditions, and create positive social change. This dispute concerning the Social Innovation concept and its meaning also depends on the nature of the existing literature. The research field is dominated by qualitative methodologies, such as case study analysis (Bhatt & Ahmad, 2017; Altuna et al., 2015; Westley et al., 2014), or literature review (de Souza João-Roland & Granados, 2020; Foroudi et al., 2021). Indeed, there seems to be no agreement among scholars, and the conceptualisation persists to be fragmented (Foroudi et al., 2021). According to Tracey and Stott (2017), these should be defined rather loosely as the process of generating and applying new solutions to address societal issues, with the resulting benefits extending beyond the innovators themselves. This definition emphasises the “concept-umbrella” nature of the term. In this sense, an

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

5

illustrative instance can be seen in the case study of Maclean et al. (2013) about the substantial help that social innovations can provide for disadvantaged communities, helping to revitalise a region socially and economically. Ziegler (2017) addresses the uncertainty and the extensive scope of the Social Innovations concept by studying them as collaborative concepts that provide the locus for different actors and perspectives to work together. Later, João-Roland and Granados (2023) return to the centrality of collaborative relations to achieve Social Innovation: the authors argue that universities, users, and the community are crucial to perform effective Social Innovation during the entire innovation process. Through the analysis performed, the centrality and urgency of these issues derive not only from the problems that Social Innovations address but, above all, from their capacity to create new relationships and collaborations. Moreover, it is clear from the varied definitional landscape presented here how much the topic is academically and politically discussed (Cajaiba-Santana, 2014). According to Cajaiba-Santana (2014), one potential approach to comprehending Social Innovations is to study them through the lens of the Institutional Theory and Structuration Theory, as both theories highlight the relational nature established between the agents and the social system. Indeed, these approaches have been followed by previous scholars (i.e. Lee, 1959; Hargrave & Van de Ven, 2006; Hämäläinen, 2007) to emphasise the role agents and social systems play in the Social Innovation process. The author explains that Institutional Theory allows us to highlight how actors interact to exchange knowledge and resources. At the same time, the Structuration Theory provides insights into the extent to which people are actively engaged in the process. Van Wijk et al. (2019), emphasising the role of the institutional context, argue that institutional factors such as regulation, norms, or values could determine the development of Social Innovation. The authors propose an integrated conceptual framework with macro-level institutional factors, meso-level (the interactive space where innovations are co-created), and micro-level factors (individual motivations, social networks, and collaborations). The debate on the relational process of Social Innovations had already been addressed by Le Ber and Branzei in 2010: according to the authors, increasing social value or, alternatively, reducing relational risk makes it possible to move from failure to success. Le Ber and Branzei (2010) discussed the process of Social Innovation that revolves around relationships and interactions, while Lashitew et al. (2020) focused on the embeddedness concept. They argue that solid embeddedness allows access to different resources and strengthens the cruciality of internalising social issues. The systematic review of the literature reveals a different cause for debate, namely the origins of the topic. According to Cajaiba-Santana (2014), we are dealing with a flourishing literature mostly neglected by scholars. It seems that scholars have focused mainly on social enterprise, reconducting and comparing the Social Innovation topic to other typologies of business organisations. The social enterprise, however, represents just one of the possible categorisations of Social Innovation. Researchers operating within the social field prioritising the exploration of For-Profit

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1 Social Innovation and Reverse Innovation: Theoretical Framework

organisational firms’ left unexplored primarily in the area of Social Innovations. As a matter of fact, this literature appears as “fragmented, disconnected, and scattered among different fields such as urban and regional development, public policy, management, social psychology, and social entrepreneurship” (Cajaiba-Santana, 2014, pp. 42–43). Sanzo-Perez et al. (2015) instead emphasised a different juxtaposition. Remarkably, the authors consciously combine Social Innovation with another stream of literature, which has recently been researchers’ main centre of interest: transformative service research. The latter is intended to examine how to enhance social well-being through services, meaning the co-creation process of services with the other stakeholders involved while increasing access to valuable services. The integration of these topics determined whether “internal market orientation” and “information and communication technology competences” influence the extent to which organisations develop Social Innovations. These components appear to benefit the co-creation of Social Innovations (Sanzo-Perez et al., 2015). Moreover, the review has revealed that appropriate reasoning about the process of growth and dissemination of Social Innovations is missing (Lettice & Parekh, 2010). In order to fill this gap, the authors discuss how useful it could be to adopt for social innovators the so-called “peripheral vision” that would enable them to see and catch opportunities that you usually would not expect. Secondly, a reflective approach could help solve problems featuring several causes and connections, which could be very difficult and frustrating. Indeed, a more reflective approach could be the key for social innovators. Similarly, creating a partnership, according to the authors, could guide in simplifying the difficulties that underpin Social Innovation, as few case studies already proved (Lettice & Parekh, 2010). Another ground of disagreement among scholars concerns the temporal positioning of the phenomenon: indeed, while some scholars consider the topic as recent, according to others, this newness is just illusory (Grimm et al., 2013; CajaibaSantana, 2014). The consideration that pushes researchers to study Social Innovation as a current phenomenon is entirely invalid. However, as Grimm et al. (2013) stated, the confusion around the actuality of the topic could be due because “social innovation [as a term] can refer to both the means and the ends of action” (Grimm et al., 2013, p. 438). There is broad agreement about Social Innovation having a rich and fascinating past, extending back to the cooperatives and the social and economic movement of the Victorian era (from 1837 to 1901, approximatively). According to others, one could assume that Social Innovation has a more distant past, tracing the concept back to the civilisation itself (Tracey & Stott, 2017). In an opposite position are others among the authors considered in the analysis who study Social Innovation as a novel and emerging field of research (Lettice & Parekh, 2010). Those represent another stream of the literature, according to which the rapid development and the increase of notoriety among scholars and policymakers lead to essential weaknesses. There needs to be more clarity and an overview of what Social Innovation is and its actual jurisdiction (Van der Have & Rubalcaba, 2016). Of course, we could not assume that these are the only deficiencies around the topic within the literature, but these are some of the most emphasised.

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

7

What we have seen so far through the literature review shows the complexity related to Social Innovations with which researchers have interfaced. Further complicating the issue are the overlaps with topics such as social entrepreneurship, with which there are certainly similarities but just as many discrepancies (Dawson & Daniel, 2010). According to Dawson and Daniel (2010), while it is true that Social Innovations have similarities with the latter phenomenon, it is also true that the concept of Social Innovation extends beyond the notion of social entrepreneurship. Indeed, Social Innovations include “the engagement and ownership of the collective process of developing and steering strategies for social change by the groups involved” (Dawson & Daniel, 2010, p. 19). In support of this thesis, Tracey and Stott (2017) state that social entrepreneurship is considered the most prominent form of Social Innovation. Regarding the controversy over the definition, despite the agreement on the importance played by the social mission of such innovations, this would seem insufficient to delineate the boundaries of the phenomenon concerning similar concepts. More precisely, it appears necessary to distinguish social from business innovations from the review. These are, once again, concepts whose demarcation boundaries are quite blurred: they have their own peculiarities but share common features (Pol & Ville, 2009). Business innovations are usually aimed at profit maximisation. However, it seems inaccurate to distinguish Social Innovations from traditional innovations by considering only profit: Social Innovations can also be aimed at making a profit. In other words, if social purpose is the main focus of such innovations, it cannot be excluded that there may be an additional economic interest (Altuna et al., 2015). On the one hand, it should be noted that Social Innovation and traditional innovations share similar challenges and difficulties. On the other hand, both belong to different categories and should not be confused. Within the literature, Social Innovations are presented as more ambiguous and complex than traditional ones because they tend to be accountable to diverse stakeholders with varying interests, objectives, and potential conflicts of interest (Lettice & Parekh, 2010). Furthermore, the analysis pointed out that the majority of the current literature on Social Innovation up until now builds its studies upon theoretical research (Phillips et al., 2015; Farinha et al., 2020) or on systematic reviews of the literature (Van der Have & Rubalcaba, 2016; Phillips et al., 2015; Dioniso & de Vargas, 2020) aimed at examining the progression of the concept over time. The systemic approach proposed by Edwards-Schachter and Wallace (2017) is among the latter: the authors debate and propose the multiple application of Social Innovation throughout the past five decades. This work shows how Social Innovations are united by three distinctive elements: social change, the service sector, and sustainable development (EdwardsSchachter & Wallace, 2017). The authors probably chose this approach to the subject because of the absence of a more suitable and appropriate instrument for measuring Social Innovation. The lack of adequate tools complicates the work of researchers: indeed, it could be a struggle to investigate Social Innovation issues. In conclusion, there seems to be agreement among the various scholars examined on one element: social innovations, by their very nature, are considered “context

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1 Social Innovation and Reverse Innovation: Theoretical Framework

specific” (Pol & Ville, 2009). Indeed, as pointed out by Canestrino et al. (2015), in different settings, what is considered social may not be acknowledged as such. That may depend on the impact of context and, particularly, how context could affect the perception of what is considered social within a particular geographic region. Furthermore, the general economic and welfare conditions help to shape and modify what is recognised as social. This view is in line with what Tracey and Stott (2017) identified as a possible future research agenda for Social Innovation. As the authors stated, “geography and the role of place in Social Innovation” (Tracey & Stott, 2017, p. 57), together with the characteristics of the institutional environment, could significantly affect how social innovators operate and differ globally. Table 1.1 summarises all the contributions considered through the systematic literature review.

1.1.1

The Implementation Phases of a Social Innovation

According to the Guide about Social Innovation developed by the European Commission (2013), Social Innovation is “the entire process by which new responses to social needs are developed to deliver better social outcomes. This process is composed of four main elements:—Identification of new/unmet/inadequately met social needs;—Development of new solutions in response to these social needs;—Evaluation of the effectiveness of new solutions in meeting social needs;—Scaling up of effective social innovations” (European Commission, 2013, p. 7). Since the topic is still unclear within the literature and, as mentioned earlier, appropriate tools or measurement variables are missing, this book intends to provide at least a comprehensive discussion about the implementation phases of Social Innovation. The European Commission merely brings to light four of them. Another significant contribution was elaborated by Murray et al. (2010). According to the authors, the process of Social Innovation entails six distinct stages, which do not necessarily follow a linear path: an innovation may skip some stages. The first stage, called “Prompts, inspirations and diagnoses”, includes all those elements that contribute to the emergence of the need for innovation, such as a crisis or the cutting of public expenditure; the latter makes it necessary to find new ways of offering a given service. Crises considered the mothers of creativity and innovation, are often exploited by leaders to achieve significant changes or by governments to accelerate reforms. Central to this phase is the generation of an idea: this centrality is found in all types of innovation. However, when dealing with Social Innovation, a direct experience or event often stimulates the idea. Even looking at what seems familiar from a new perspective can be a stimulus. In order to generate the right idea, there is a need to diagnose and understand the problem in its wholeness so that no element is overlooked. Identifying the right problem is more complex than it seems because it may appear hidden or marginalised: social phenomena are usually not automatically visible. Much of the current research is precisely aimed at highlighting problems that need attention. In this regard, mapping techniques, data, and feedback

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

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Table 1.1 Sample of the social innovation systematic literature review Author(s) Dawson P., Daniel L.

Title Understanding social innovation: A provisional framework

Year 2010

Lettice F., Parekh M.

The social innovation process: Themes, challenges, and implications for practice Social innovation and social entrepreneurship: discovering origins, exploring current and future trends Five configurations for scaling up social innovation: Case examples of nonprofit organisations from Canada. Social innovation: a window on alternative ways of organising and innovating Social innovation, an answer to contemporary societal challenges? Locating the concept in theory and practice Social innovation as a collaborative concept

2010

Social innovation: Buzz word or enduring term? Social innovation drivers in social enterprises: systematic review Cultural insights of CSI: how do Italian and Iranian firms differ? Social Innovation and Social Entrepreneurship: A Systematic Review

2009

Farinha L., Sebastião J.R., Sampaio C., Lopes J. Westley, F., Antadze, N., Riddell, D. J., Robinson, K., & Geobey, S Tracey P., Stott N.

Grimm R., Fox C., Baines S., Albertson K.

Ziegler R.

Pol, E. & Ville, S. P. João-Roland, I. D. S. & Granados, M. L. Canestrino R., Bonfanti A., Oliaee L. Phillips W., Lee H., Ghobadian A., O’Regan N., James P. Altuna N., Contri A.M., Dell’Era C., Frattini F., Maccarrone P.

Managing social innovation in for-profit organisations: The case of Intesa Sanpaolo

2020

Journal International Journal of Technology Management International Journal of Technology Management International Review on Public and Nonprofit Marketing

Impact factor 1.526

Quartile Q3

1.526

Q3

1.63

Q3

2014

The Journal of Applied Behavioral Science

2.286

Q2

2017

Innovation: Management, Policy and Practice

2.453

Q2

2013

Innovation: The European Journal of Social Science Research

2.541

Q2

2017

Innovation: The European Journal of Social Science Research Journal of Socioeconomicsa Journal of Socioeconomics

2.541

Q2

1.831

Q2

1.831

Q2

Journal of Innovation and Entrepreneurship Group and Organization Management

4.02

Q3

4.29

Q1

European Journal of Innovation Management

4.75

Q1

2020

2015

2015

2015

(continued)

10

1

Social Innovation and Reverse Innovation: Theoretical Framework

Table 1.1 (continued) Author(s) Lashitew, A. A., Bals, L., & van Tulder, R.

Maclean M., Harvey C., Gordon J.

Van Wijk, J., Zietsma, C., Dorado, S., De Bakker, F. G., & Martí, I. Le Ber M.J., Branzei O.

Dionisio M., de Vargas E.R. van der Have R. P., Rubalcaba L.

Cajaiba-Santana G. EdwardsSchachter M., Wallace M.L. de Souza JoãoRoland, I., & Granados, M. L. Solis-Navarrete, J. A., BucioMendoza, S., & Paneque-Gálvez, J. Bhatt, P., & Ahmad, A. J.

Foroudi, P., Akarsu, T. N.,

Impact factor 6.331

Title Inclusive business at the base of the pyramid: The role of embeddedness for enabling social innovations Social innovation, social entrepreneurship, and the practice of contemporary entrepreneurial philanthropy Social innovation: Integrating micro, meso, and macro level insights from institutional theory

Year 2020

Journal Journal of business ethics

2013

International Small Business Journal

6.413

Q1

2019

Business & society

6.74

Q1

(Re)forming strategic cross-sector partnerships: Relational processes of social innovation Corporate social innovation: A systematic literature review Social innovation research: An emerging area of innovation studies? Social innovation: Moving the field forward. A conceptual framework ‘Shaken, but not stirred’: Sixty years of defining social innovation Towards social innovation strategy: An analysis of UK social enterprises. What is not social innovation

2010

Business & society

6.74

Q1

2020

International Business Review

8.047

Q1

2016

Research Policy

9.473

Q1

2014

Technological Forecasting and Social Change Technological Forecasting and Social Change Technological Forecasting and Social Change Technological Forecasting and Social Change

10.884

Q1

10.884

Q1

10.884

Q1

10.884

Q1

6.740

Q1

8.240

Q1

Financial, social innovation to engage the economically marginalised: insights from an Indian case study Intellectual evolution of social innovation: A

2017

2023

2021

2017

2021

Entrepreneurship & Regional Development

Quartile Q1

(continued)

1.1

A Systematic Literature Review of the Social Innovation Phenomenon

11

Table 1.1 (continued) Author(s)

Title

Marvi, R., & Balakrishnan, J.

bibliometric analysis and avenues for future research trends How to encourage social innovations: A resourcebased approach

Sanzo-Perez M.J., Álvarez-González L.I., Rey-García M.

Year

Journal Industrial Marketing Management

2015

Service Industries Journal

Impact factor

9.405

Quartile

Q1

Source: Author’s elaboration Today, the journal is called the Journal of Behavioral and Experimental Economics

a

systems are gaining popularity. The last moment of this phase is dedicated to moving from the symptoms to the cause: diagnosing the problem is the first step towards its resolution. The diagnostic process involves collecting and interpreting data and should involve all stakeholders in the proposals. “Proposals and ideas” constitute the second stage: once the appropriate question has been posed, there are various techniques to suggest possible solutions. In this stage, then, ideas will be generated through formal methods: these can be done to encourage creativity or to incite people to think differently. The sources from which ideas can come are many and varied, i.e. the community, the users themselves or others. The focus on the process by which an innovation develops stems from the assumption that this process is as important as the innovation itself. These two elements are closely linked and interdependent. Hence, the following question arises: given the crucial role of the participation of actors with different interests, what is the best way to involve them? A frequently used approach in these cases is co-design, which can be declined in various ways, namely user-led design, which requires the encounter between designers and users, who are often the only ones able to identify best and solve their needs. Further, the engagement of ex-users or engaging citizens through media. The aim is to think differently since an idea can often come from an apparently distant field, and it is pretty unusual for it to come from a single source. In this regard, open innovation is particularly suitable: it is a paradigm proposed initially by Chesbrough (2003), according to which firms should draw on ideas from both within and beyond the organisation. According to his most recent and comprehensive definition, “Open Innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as they look to advance their technology” (Chesbrough, 2006, p. 2). In accordance with Murray et al. (2010), open innovation is based on numerous principles, including sharing, collaboration, decentralisation, transparency of the process, and plurality of participants. Open innovation has become more important and frequent in recent decades thanks to the introduction of the Internet, which allows for reduced costs and multiple interactions. Therefore, participation is crucial at this stage and must be pursued at all costs: virtual meetings, conferences, and webinars are all events aimed at increasing the participation rate.

12

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Social Innovation and Reverse Innovation: Theoretical Framework

Once the ideas have been formulated, they should be tested in practice through a series of trials, errors, and continuous adjustments. The third step, “Prototyping and Pilots”, precisely tests innovations and possibly improves them. This step is particularly relevant within the realm of Social Innovation, as it is within this sphere that, through interactions between several actors, most problems are solved. These include the feasibility or cost-effectiveness of the product or how to provide the service itself. To adequately respond to these challenges, it is necessary to be fast, keep costs low, and listen cyclically to feedback from specialists and users. The construction of a prototype involves the creation of a fully functioning model of the product/service offered. It serves primarily to test the reaction of suppliers and potential customers: in this case, we refer more appropriately to beta tests. Based on the sector, there could be slow or fast prototypes. The formers are common if new capabilities need to be developed. The latter first emerged in the field of software and then spread to the field of social prototyping. Among the financial instruments available for prototype development, there can be small grants or loans, prizes of various kinds, and tenders. The fourth phase, “Sustaining”, is where the small part of the ideas that survived the testing phases are put into practice. In this phase, the project’s sustainability must be studied, ensuring there is the right financial sustainability for carrying out the innovation, whichever organisation is in charge: social enterprise, charity, or firm. Even the seemingly best ideas may not be sufficiently practical or cost-effective to endure; those that do survive will need to be accompanied by a sustainable long-term business plan. The six critical elements for achieving and maintaining sustainability are a business model, a governance model, short and long-term sources of funding, a networking and communication model with which developing relational capital, staff including volunteers, and finally, an operational plan. All these elements should be included in the business plan, together with all the details of the offer. It is precisely at this level that the first conflicts begin to appear. Although everyone wants to collaborate and share, there is a strong desire to curb the leakage of information to safeguard one’s own financial survival. If we are in the public sector, other tools will be needed to support sustainable ideas, including public programmes, policies, or legislation. “Scaling and diffusion” constitute the fifth phase, dedicated to implementing strategies aimed at the growth and diffusion of innovation; this can take place through franchising agreements, licensing, or free diffusion. The boundary between the process of disseminating Social Innovation and traditional innovations is quite clear: in the latter case, benefits are expected to be reserved within the organisation itself. On the contrary, Social Innovations aspire to the rapid diffusion of innovation, mainly through networking activities. Scaling, indeed, represents a real challenge for social innovators who would like to get their innovation to as many people as possible. Therefore, it is not difficult to imagine how complex the process of disseminating Social Innovations is. Growth can take multiple paths and could depend on both supply and actual demand: the former indicates how well the innovation works, and the latter the willingness to pay for that product/service. Although both are necessary, they alternate in being prioritised one over the other.

1.2

Systematic Literature Review of the Reverse Innovation Concept

13

In order to increase supply, the effectiveness of innovation can be improved. To enhance the demand, awareness raising campaigns or advocacy can be used. The quality of the idea behind the innovation itself can drive its diffusion, although this is a relatively rare mechanism, as very few innovations spread on their own. In some cases, projects become iconic and inspire emulation processes. Mistakenly, to stimulate the diffusion of Social Innovation, pressure has often been exerted from the supply side; in reality, the impetus could come from the users, who can leverage the public sector and improve its products/services by sharing information. In this sense, social movements are important drivers for Social Innovation. Regarding the public sector, there are various options available: the government could turn an idea into a law or a programme, or it can encourage dissemination through the influence of legislators. At this stage, monitoring and measuring how much innovation has grown is essential. However, as mentioned before, there are few current measures to assess social value in use, and most of those developed have failed. This failure stems from the multiple roles that metrics usually have to fulfil: to assess social impact over the long term; to provide valuable data for funders and organisations to manage their internationalisation choices. These purposes, at least partially, overlap with each other and, above all, easily create conflicts of interest between all partners involved. For this reason, no effective indexes have yet been developed. The last step in the process, called “Systemic change”, outlines the goal of innovation and assumes that the change combines, differently, several elements. An interesting example is represented by cars, which have led to numerous innovations, such as tyres, combustion engines, and electrical systems. For systemic change to occur, therefore, many factors must interact, contributing to the development of innovations that radically alter the systems on which they depend. The resulting systemic innovations change entirely not only the economic flow but also how people think and behave. The process by which this is achieved is primarily cumulative. In other cases, a boost may come from the occurrence of crises or disruptive technologies. Once again, we face an extremely complex phenomenon that makes it difficult to determine the tools to move it forward. Looking back, however, it is possible to outline some of them; these include creating coalitions between different partners and training professionals and practitioners with new skills. These innovations are generally very rare, as the necessary incentives to implement change are lacking in stable conditions.

1.2

Systematic Literature Review of the Reverse Innovation Concept

The term Reverse Innovation was first introduced by Immelt, Govindarajan, and Trimble in 2009, and still today, it is mainly used in the press and has not been sufficiently researched scientifically (Brem & Wolfram, 2014). With Reverse

14

1 Social Innovation and Reverse Innovation: Theoretical Framework

Innovation, we refer to the global innovation literature and the diffusion innovation literature. The phenomenon is defined as those innovations that were conceived and developed in the emerging context and then spread to more mature economies. Nowadays, the interest of academics and others in issues of this kind is dictated by the growing role played by so-called “emerging economies”: these are now considered the emerging focal point of the global economy, expansion, and innovation (Shan & Khan, 2016). Apparently, emerging countries have better problem-solving abilities (Dellermann, 2017). Indeed, in line with Shan and Khan (2016), innovativeness is no longer strictly dependent on the rules and trends presented by advanced economies. Instead, it is the emerging economies themselves that develop their own innovations and then, eventually, disseminate them globally. Trends and flows are completely reversing from what we are used to witnessing. Depending on the proliferation alongside the rise of innovations created within and for emerging markets, there is a corresponding growth in the use of terminology. This vocabulary is often applied in a confusing and chaotic manner (Agarwal et al., 2017). Therefore, as we pointed out for the Social Innovation phenomenon, there is a need to organise all the content available about the topic and clearly delineate their boundaries. Moreover, “Although reverse innovation draws on established theories, it fails to clearly identify where the links do exist and where they do not” (Radojević, 2015, p. 71). Reverse Innovation is considered by most as an internationalisation process, which is in total contrast to the well-known Vernon’s Theory of the “Product life cycle” (Kamp, 2012). According to the author, firms would only enter internationalisation only during the third phase of the product, which is maturity. Within maturity, it is convenient for firms to go international since the domestic market is saturated and the technology is standardised in the home market (Vernon, 1966). Vernon’s theory has long been considered among the most valid in the field of internationalisation. However, researchers have recently challenged its veracity, advancing crucial issues. Apparently, the theory’s explanatory capability is reducing: first of all, because of the inability to justify why some foreign direct investments (FDI) are immediately directed towards developing markets. Secondly, the theory does not provide an adequate answer to why some firms decide to invest abroad in a different stage than maturity. Third, through the theory, there is a lack of justification for the existence of the so-called “Born Global Firms” (Calvelli & Cannavale, 2018). Today, then, taking into account the elements mentioned earlier concerning the decisive role of developing economies, it appears even more anachronistic. Referring to Vernon’s theory would leave emerging economies to a merely marginal role within the global economy. The discourse around the Reverse Innovation concept needs significant research that goes beyond the numerous single or multiple case studies (Baglieri et al., 2014; Costa et al., 2015; Zheng et al., 2016; Corsi et al., 2014) presented in the literature, as stated by Reyes-Mercado (2019). Moreover, “as reverse innovations have similar patterns to frugal innovations (both are born in an emerging country and then jump into more developed ones), there is a need to understand how such innovation diffuses across two very different markets with contrasting socio-economic, cultural,

1.2

Systematic Literature Review of the Reverse Innovation Concept

15

and behavioral settings” (Reyes-Mercado, 2019, p. 304). Among the most famous cases discussed in the literature are General Electrics, Nokia, Renault, and L’Oréal. It became urgent to provide a more integrated perspective on similar phenomena, defining their scope and clarifying their role within the current internationalisation strategies in use. Additionally, clarifying the possible research strands of Reverse Innovation and the objectives that such innovations pursue is compulsory. According to some scholars, Reverse Innovations could be products whose primary purpose is to meet and satisfy consumer needs while solving problems of a purely social nature (Govindarajan & Euchner, 2012; Vadera, 2020). With this aim, the book conducted a comprehensive literature review to delve into the concept of Reverse Innovation. The methodology implemented is like the one used in the previous section. A search was conducted via Scopus, using the following keywords: “Reverse innovation” for the first query and “Reverse” AND “innovation” for the second query. From the Scopus search, a sample of 217 papers emerged from the first request and a sample of 2922 for the second. During the subsequent stage of the process, the number of contributions was reduced by selecting the following criteria: (1) Search area “business, management and accounting”, (2) Document type “articles”, (3) Source type “journal”, and (4) Language “English. In this phase of the process, a sample of 62 papers was extracted from the first query, and from the second, a sample of 402. The results were merged in an Excel file, and the duplicates were deleted: the sample comprehended a total of 400 results. Further, the sample was reduced based on the impact factor (