Social Entrepreneurship and Frugal Innovation: A Composition-Based View

How do social entrepreneurship organisations sustain and innovate to serve base-of-the-pyramid populations in emerging economies? This paper delves into the strategies and processes employed by social entrepreneurship organisations to create both social and economic value via frugal innovation approaches combining cost-effective value creation and social problem solving and thus ensure their sustainability. To elucidate this, a composition-based view is leveraged, which emphasises how organisations possessing ordinary resources can accomplish extraordinary outcomes. Extending the composition-based view to social entrepreneurship research, three new concepts around compositional strategies are introduced: (1) specialist versus generalist compositional offering, (2) temporary versus sustainable competitive advantage based on compositional competition, and (3) value-driven versus task-driven compositional capability. Utilising three examples—India’s Selco, Ghana’s Toyola, and Brazil’s Centre for Digital Inclusion—specific conditions under which social entrepreneurship organisations apply the identified compositional strategies to further their social ambitions in a sustainable manner underpinned by frugal innovation to serve base-of-the-pyramid populations are illustrated.