Effectiveness through Empowerment

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„The Pure Joy of empower and empowerment: open your dream to others and let them synergies with you to achieve them“ Mitslal Kifleyesus-Matschie

In The Bottom Billion: Why the poorest Countries are Failing and what can be done about it, Paul Collier sets a ground-stone in the research field of poverty eradication. Conventional aids have been unable to tackle the problem. Even if global poverty is falling rapidly in around fifty failing states the world’s poorest people face a tragedy that is growing inexorably worse. This bottom billion is left further and further behind with potentially serious consequences not only for them but for global stability, while the rest of the world moves steadily forward. From this need to re-negotiate the world emerged the hybrid of Social Entrepreneurship, designed to transcend boundaries. In order to fight this long existent inequalities we need to transcend long-standing, disciplinary and functional boundaries that require us to move beyond the classic notions of firm, social society, market and development.

A question of Accountability

In the conference Locating Social Entrepreneurship in the Global South: Innovations in Development Aid of the Wilson Center, Paul Collier reformulated the question around the effectiveness of companies. The productivity of different societies is not only a discussion about the individuals but furthermore enrols the societies themselves. Why are poor countries poor? In the classical economical understanding the reason for a society’s poverty was equivalent to its lack of capital. In the past decades the common employed method consisting of inserting capital in poor countries failed. The equation:  (−)capital = poor , was missing a variable. For Paul Collier, the missing x in the equation (−)capital + x = poor, were the poor economic policies and strategies. Institutions are capable of empowering people but: good people aren’t enough to overtop bad government.

A question of Identities1616344_10202798120016741_927932045_n
In order to overcome the complexity of the problem, solutions must merge from within and overcome the limits of social collaboration: the absence of identity sense. In fact, a strong-shared sense of identity is essential to social collaboration: identity matters. George Akelof in Identity Economics underlined that the presence of effective organisations are decisive in societies. What organisations are able to achieve is determinant concerning the influence they poses in the harming or motivation of individuals. But what makes an organization effective?

A question of Effectiveness or furthermore of Socialisation?
Adam Smith observed two centuries ago the birth of effective organisations: the effective organisations were capable of harness the new upcoming technologies merging from the industrial revolution. Nowadays we distinguish two features that make people more effective: scale and specialization. But with the scales merged the difficulty of workforce motivation and with the specialisation the problem of cooperation and coordination. An effective organisation is the one reconciling the downsides problems of scale and specialization. To briefly explain it, a good management is the key. And internalization is the key to good management. In fact, Collier mentions that effective organizations are the one’s succeeding in internalize their company’s objective in the heart and minds of their employees. This Socialisation of good work is essential to understand the gap between rich and poor societies. In poor societies, effective organization are rare, they represent the exception. The Socialization that we take for granted is not present since the workers are socialized in a completely different set of attitudes.

So what?
The need for effective enterprises persists and is necessary to surmount the existing gap. So what is South Africa’s situation?

The World Economic forum on Global Competitiveness ranked South Africa as 53rd most competitive country out of 148 in its 2013/2014 survey. This makes South Africa the second highest ranked African country after Mauritius. Among the BRIC’s economies South Africa took over Brazil’s 48th place. In this quite favourable disposed economic environment we are quite geared to see how the entrepreneur sphere react. Binding innovation processes and furthermore, how this spheres pose the question of Effectiveness and Socialisation is one of our future expectations.