The socio-political and economic conditions in North America have been undergoing a considerable shift over the last several decades. The end of the post-WWII “golden age” heralded a gradual erosion of the Keynesian welfare state social safety-net and as a result, state funding has been continuously withdrawn from social services.

The reason for this shift is due to the rise of a neo-liberal brand of capitalism that has the ability to create vast amounts of wealth but does not adequately account for the social and environmental externalities that result from ‘business-as-usual’ practices. These externalities can be understood as the destruction of the environment and the systemic social exclusion and poverty that arises due to the inherently dispassionate and detached nature of Neoliberalism – best captured by the sentiment of one of its staunchest supporters, Milton Friedman, “there is one and only one social responsibility of business – to use it resources and engage in activities designed to increase its profits.”

By design, this economic system creates an ongoing need for non-profit organizations to fill the void in social service provision; however this responsibility has been undertaken in an economic environment increasingly characterized by limited fiscal and human resources. Enter the Social Enterprise.

Social enterprises operate at the intersection of the private, public and third sectors. In this space, the social enterprise fulfills a critical role of furthering social and environmental agendas within the confines of the capitalist system. That is to say, they utilize the tenets of capitalism to appeal to society’s consumer culture, but do so as a means of achieving social change.

This is an important distinction – one that has the potential to revolutionize the status quo and create a more socially equitable and environmentally sustainable reality. Having the triple bottom line (social, environmental and profit) as the guiding principle instead of solely profit, allows for a more inclusive system that can appropriately account for (if not eliminate) negative externalities.

My work as an independent researcher has focused on the ways we can adapt and enhance the social economic paradigm to create better business models capable of competing on larger scales, with private sector giants. The most recent article I’ve published on this subject deals with the concept of Co-location as a viable model that can reduce financial and administrative burden of social enterprises while generating social innovation.

Co-location is a popular concept for supply chain integration in the private sector and has incredible potential for social enterprise. The theory is based on the fact that throughout our history, humans have always thrived when working together towards common goals. The power of our collective action has built cities, transformed entire societies and even changed the course of history.

Co-location builds on this fundamental principle of human system interaction and is premised on the notion that sharing space can be an effective way for smaller non-profit or social enterprise organizations to reduce their costs, expand their services and improve their operational efficiency. Co-location also offers an avenue to capture and harness the creative energies of like minded people. Sharing space has been a practice of the third sector for decades, however new social research has uncovered that the benefits of sharing space go far beyond simple economic considerations.

Specifically, sharing space can “break down silos, reduce costs, increase opportunities for collaboration and cooperation, create knowledge and learning networks and spark social innovation”. So while this may not be a new concept, it is certainly one worth looking at again.

The research on co-location over the last two decades has found that the social, political and economic advantages of sharing space are profound. This is particularly important for non-profits or social enterprises that are more often than not: understaffed, underfunded and overworked. At a very mechanistic level, sharing space can reduce the administrative burden on non-profits through cost-sharing for common tools such as advertising, printing, heating and water costs etc.

There are also political advantages to sharing space: the political leverage that can be exacted from having strategic clusters working together on bids or lobbying can be significantly more than a singular organization working towards the same ends. Most importantly, there are tangible synergies that transcend these more technical advantages. The real magic of the shared space concept is predicated on the equation: Physical Space + Community = Social Innovation. The theory of co-location asserts that by sharing space (and costs) with driven, talented and like-minded individuals social innovation can occur at a more rapid and frequent pace.

Being immersed in such a creative environment allows for continuous learning, inspiration and accelerated growth and development. The upcoming Social Enterprise Alliance Summit 14 employs the tenets of co-location at the temporary but macro-cosmic level by bringing together giants in the social economy to help foster an atmosphere of learning by creating opportunities to engage with each other in order to harness the power of our collective action.

Summit 14 provides a platform to explore the potential of this emergent sector to create lasting and meaningful change that will ensure a better future for our children – and to remind us that together, we CAN make a difference.

This post was written by Andi Sharma, MPA, Policy Analist, Government of Manitoba. She will be speaking on this topic at the upcoming Social Enterprise Alliance Summit ’14.