Analyzing the Success Factors of Best Practices in the Korean Social Economy 2019.11 " Analyzing the Success Factors of Best Practices in the Korean Social Economy Published on 29.11.2019 Published in KoSEA Published at 7,8F 157 Sujeong-ro, Sujeong-gu, Seongnam, Gyeonggi-do, Republic of Korea Publisher In-sun Kim(president.KoSEA) Tel 031-697-7700 Fax 031-697-7889 Website http://www.socialenterprise.or.kr Designed by sangsangneomeo ※ Copyright(c)2019 by KoSEA. All Page contents cannot be Not for sale copied without permission. Research Institute Hanshin University R&DB Foundation Principal investigator Jongick Jang(Professor of Global Business Department, Hanshin University) Co-investigator Changho Oh(Professor of Department of Business Administration, Hanshin University) Hyun S. Shin(Professor of Division of Business Administration, Hanyang University) Research assistant Jungsoo Park(Graduate School for Soical Innovation Business, Hanshin University) Suyeon Lee(Graduate School for Soical Innovation Business, Hanshin University) Gyejin Choi(Graduate School for Soical Innovation Business, Hanshin University) Jeonghoon Kang(Graduate School of Business Administration, Hanyang University) Table of Contents Foreword 5 Ⅰ. iCOOP Consumer Cooperatives 9 iCOOP Consumer Cooperatives, Repeating Innovations through a Strong Network Organization Ⅱ. Ansung Health Welfare Social Cooperative 32 Ansung Health Welfare Social Cooperative, Realizing the Co-Production Model of Medical Services and Local Community Building Ⅲ. Social Cooperative Dounuri 51 Social Cooperative Dounuri, Creating Decent Jobs in Care Services Ⅳ. Happy Bridge Cooperative 67 Members of Happy Bridge Cooperative, Moving towards the Innovation from Wage Workers to Collaborative Worker Owners Ⅴ. BeautifulStore 84 Creating a beautiful world of sharing and recycling where everyone participates Ⅵ. Dasomi Foundation 103 Dasomi Foundation: Shifting the Paradigm of Care Services through Partnership and Innovation Ⅶ. A company 125 A company: Shining a new light of hope on the art market and rising artists Ⅷ. TestWorks 144 Testing New Possibilities in the Employment of Socially Vulnerable Groups Ⅸ. JUMP 158 A Meaningful Jump Towards a Fair Society Ⅹ. Tree Planet 173 Until the Day Everyone on Earth Plants Trees 4 Foreword This report describes the results of a systematic analysis of the factors that led to such achievements by selecting 10 excellent examples of social economy enterprises that have recently grown in Korea. Interest and practice in the social economy sector have been spreading greatly in Korea recently, with 19 years since the 2000 Act of Assistance of Non-Profit Civil Organizations was enforced, 12 years after the 2007 Social Enterprise Promotion Act was enforced, and seven years after the 2011 Framework Act of Cooperatives was enforced. This research report was published for the purpose of systematically investigating and analyzing excellent cases to provide strategic and policy implications. A total of three researchers, four research assistants, and seven manuscript reviewers participated in the preparation of the case report. And most of all, I am deeply grateful to the representatives and practitioners of the ten social economy enterprises for their time spent interviewing and cooperation in preparing the case for this research report. Of the ten successful social economy enterprises selected by this study, four of them, iCoop Consumer Cooperative, Ansung Health Welfare Social Cooperative, Social Cooperative Dounuri, and Happy Bridge Workers' Cooperative, take cooperative legal entities while three of them, ACompany, Tree Planet and Test Works, are of corporation entities. Dasomi Foundation and Beautiful Store take non-profit foundation entities while Jump is of non-profit incorporated association entity. Based on mutuality, iCoop and Happy Bridge have a mission to promote economic exchange of consideration for humans, environment and community, and to create and maintain quality jobs, while Ansung, Donuri, Dasomi, and Jump have a mission to pursue the happiness of both beneficiaries and providers of social services as a social enterprise. Beautiful Store, Tree Planet and ACompany are operated to realize civil participation-type public interests in the environment, culture and arts sectors where their value is excluded or there are not many opportunities in the capitalist market, and Test Works is a work integration social enterprise that seek to create jobs that can turn the weakness of the disabled into advantages. 5 Among the ten social economy enterprises, the Ansung Health Welfare Social Co-operative is the oldest at 26 years since its establishment, the iCoop was established in 1997, and Happy Bridge in 1998. The ages of Beautiful Store, Dasomi Foundation and Dounuri are 10 to 20 years while other four companies are under 10 years old. The research specifically examined the performance of these ten social economy enterprises and analyzed key factors which have influenced the outcomes. It detailed them on a case-by-case basis. These ten examples summarize the following four strategic and policy implications. First, it was confirmed that a business model that reflects the needs of its members and the characteristics of the cooperative ownership are essential for a cooperative to succeed while a social business model that is balanced in terms of social and economic value is necessary for a social enterprise of non-co- operative type to generate social impact. iCoop and Ansung, which have found innovative institutions and culture that enhance the advantages of ownership of cooperatives and supplement its weaknesses, and Dounuri and Happy Bridge, which have designed a set of institutions and culture to help enhance the advantages of worker-owned enterprise, show successful examples of a cooperative-type business model. Test Works that generated social and financial value through customized job training and development that took into account the competitive advantages of the socially vulnerable, and the Dasomi that succeeded in simultaneously generating social and financial value through innovation in the delivery of care services are typical social business models. Second, it was also confirmed that in order for social economy enterprises to strengthen and maintain their social impact, it would be better to establish a cooperation among enterprises, such as business federations, networks and social franchises, rather than self-expansion of enterprises. iCoop has been building a business federation and a network while Beautiful Store is one of the most successful social franchise cases in Korea. Happy Bridge is aiming for an inter-company network and Dounuri is considering a social franchise as an expansion strategy. 6 Third, another strategy to strengthen social impact is public-social-private partnerships. Examples of Dounuri, Jump, Tree Planet, Beautiful Store, and Dasomi show this strategy. Fourth, I would like to emphasize that the establishment of infra structure capable of systematic external resource linkage in the early stages of social economy enterprise growth plays a very big role in success, as a suggestion to the support system on the creation and growth of social economy enterprises. It is confirmed that many social economy enterprises in this study, such as the Dasomi, Beautiful Store, Dounuri, Tree Planet and Jump, were able to secure the necessary resources in the early stages of growth, such as patient capital, management techniques and links with professional companies at their value chain. Although the description of the above highly compressed implications did not sufficiently cover the content of this study, I believe that it would serve as pillars for reading the ten case-study report. 2019. 11. 30 Jongick Jang 7 Case Study 8 Ⅰ. iCOOP Consumer Cooperatives, Repeating Innovations through a Strong Network Organization Author: Jongick Jang Research Assistant: Jung-soo Park Reviewer: Jong-hyun Park Summary · iCOOP is a network organization, which has grown since 1998, having its roots in six member cooperatives and four associate member cooperatives. As of the end of 2018, it had 99 member consumer cooperatives nationwide, iCOOP Federation, 10 related subsidiaries, 10 non-business support organizations, Farmers’ COOP and nine related subsidiaries, and Gurye and Goesan Food Overview Clusters, which accommodates 24 small and medium-sized food companies. and The number of its consumer-members stands at about 282,700 households, Reason and it has 3,910 employees. There are 2,216 farmers who have signed supply for Selection agreements with iCOOP, the capital investment is 71 billion won, and the value of total products supplied to the members is 580 billion won. · It is a leading example of creating a successful model of an organic consumer cooperative in Korea along with Hansalim Organic Cooperative. Although it started off later than Hansalim, it is worth analyzing and introducing its success factors because its outcomes are superior in terms of the business size and scope, and member activities. · Starting from the mission to save the environment and spread the production and consumption of healthy organic foods, it aims to establish an ethical con- Social Mission sumption system and people-centered economy to spread fair trade products and products with social values. · A significant increase in the selection of organic food that can be purchased with confidence; the development of an engagement structure under which members can participate