Social Innovation: Fonterra's Investment in Community Water Project

This report examines social innovation through the lens of community engagement and Fonterra's investment in Aquatek Pro Water Organisation, aimed at establishing a water purification station in Melbourne's Dockland area. The discussion encompasses social innovation and community engagement theories, approaches to social entrepreneurship, and the concept of addressing 'wicked problems.' Fonterra's funding initiative seeks to provide purified water to the Dockland community, addressing the existing lack of access and high costs. The project aims for social sustainability by creating employment opportunities and minimizing carbon footprint, while also generating profit through water sales. Potential challenges include collaboration issues and planning deficiencies. The report further discusses the financial, environmental, and ethical implications of the social innovation, emphasizing its contribution to the common good through affordable purified water, ethical operations, and environmental consciousness. It concludes by addressing significant implementation challenges, such as community collaboration and maintaining the project's core social purposes.

Running head: SOCIAL INNOVATION
Social Innovation
Student’s name:
Name of the university:
Author’s note:

Executive Summary
Social innovation is the process of social change or transformation that includes the social
entrepreneurship and social economy in delivering the economic inclusion and economic growth.
The whole discussion focuses on the community engagement with social innovation concept. At
the first part, discussion of social innovation and community engagement theories has been
developed. Approaches to social entrepreneurship, wicked problem theory and social innovation
concept have been discussed. Moreover, the social funding of Fonterra is shown to the client
group Aquatek Pro Water Organisation where Fonterra is going to invest in establishing the
water purifier station at Dockland area in Melbourne. Dockland area has been suffering from
purified water and the people have not been getting the purified water. This water purifier station
will meet the need of the common people and it will also provide water bottles at a cheap price.
Aquatek Pro Water Organisation will also provide employment to the Dockland people. This
water purifier station will not provide any carbon footprint and it will provide social
sustainability. In addition, the organisation will get profit through the selling of the water.
Aquatek Pro Water Organisation can face a challenge regarding collaboration and this
organisation can also face the issue regarding lack of planning.

Table of Contents
Introduction......................................................................................................................................4
Discussion of social innovation and community engagement theory.............................................4
Description of proposed social innovation......................................................................................7
Discussion of the financial, environmental and ethical implications of social innovation and how
social innovation contributes to the common good.........................................................................8
Discussing significant implementation challenge...........................................................................9
Conclusions....................................................................................................................................10
Reference List................................................................................................................................12

Introduction
Social innovation is the new concepts, strategies and ideas that must meet the social
needs of various elements that must be formed education, working condition and community
development. Social innovation strengthens and extends civil society and it includes the social
process of innovation. As stated by Manzini & Coad (2015), social innovation is the complex
methods of introducing the new products or services that can change basic resources, routines
and authority of flows in which innovation can occur. Social innovation tries to provide a novel
solution that must be effective, sustainable and efficient and this value would provide cure to the
society rather than the single individual.
In this study, Fonterra organisation is selected as Fonterra provides community help to
the client organisation. Fonterra Grass Roots Fund was established in the year 2014 and it
provides help to improve the water and sanitation and community infrastructure, investment and
community engagement (Fonterra.com 2018).
Discussion of social innovation and community engagement theory
Social innovation is the process of creating a new idea that can create a positive impact
on the society. The concept of social innovation has emerged from the growing dissatisfaction
from the technological emphasis in the innovation of economic area. As argued by Voorberg,
Bekkers & Tummers (2015), technological innovation focuses on main profit of the organisation,
whereas the social innovation concept provides emphasis on the human development,
community development and empowerment of the common people. Social innovation has
emerged from the result of growing challenges regarding environment, society and demography;

these issues are often called as ‘wicked problems' as these issues are multifaceted, complex and
associated with ranges of stakeholders. ‘Wicked problems’ are hard to solve and these are
conventional in the market capitalism, climate change and resource scarcity (Moulaert 2016).
Social innovation incorporates the process of doing the business through social change. As stated
by Cajaiba-Santana (2014), social innovation involves in redefining the aim of the organisation
around the shared value, that is fulfilling the social and environmental needs, not just the profit.
Typology of social innovation
Socio-juridical
innovation
Innovation is related to the laws and legal framework
Socio-analytical
innovation
Innovation is related to the sense-making and analytical framework
Socio-ecological
innovation
Innovation is related to the human environment interaction
Socio-technical
innovation
Innovation is associated with the human technology and interaction
(use of social media)
Socio-cultural
innovation
Innovation is associated with the non-formal institution
Socio-organisational
innovation
Innovation is associated with the organizational arrangement
Socio-political
innovation
Innovation is related to governance policies

Socio-ideological
innovation
Innovation is mainly related to the ideological frameworks and
mindset as well as the paradigm
Socio-ethical
innovation
Innovation is associated with the normative or ethical framework
(corporate social responsibilities of organisation)
Socio-economic
innovation
Innovation is related to the economic model, business (inclusive
business, as well as value chains, are associated with this)
Social innovations will help the organisation to create value for the environment and
society as well and the organisations want to do the things in different ways, for primarily about
the individuals like government, institutes, the private sector and civil society, on the other side,
secondarily for the use of technological processes.
Approaches to social entrepreneurship
Social entrepreneurship is the process of making and growing the venture for non-profit
or for-profit and the motivation of the entrepreneurs comes from to do the social changes. This
approach of social entrepreneurship can create the change through creating the new venture. In
addition, according to Choi & Majumdar (2014), the process of stating the social changes from
within through establishing the organisation is called the social entrepreneurship. This approach
can create alteration by providing the capabilities and resources of the established organisation.
The method of inter-organisational activities to facilitate the alternative ideas, place, people and
resources in order to bring out challenges is defined as social entrepreneurship approach. This
type of social entrepreneurship can create change by platforms which can support collective
effort within and between new and established organisations.

Description of proposed social innovation
Fonterra Grass Roots Funds takes the initiative to sponsor the projects, ideas and
initiatives that provide real impact. The community is an integral part of the business of Fonterra.
Fonterra is wholly dedicated to doing good to the community people. In Dockland area of
Melbourne, Fonterra is going to help Aquatek Pro Water Organisation to set up a water purifier
station. Dockland area is an inner-western area of the suburb of Melbourne. In Dockland area of
Melbourne has been facing the issue of poor drinkable water as sample testing showed that water
is not drinkable. The common people asked time and again to the Victoria government and it
brought no result. A section of the area has been drinking the impure water and some of the
people are buying pure water with a high cost. This water purifier station will not be large and
Aquatek Pro Water Organisation will buy readymade devices and it will seem a rather small
contribution; however, it will help a large section of people to get the purified water.
In Dockland area, the people who live in the eastern area are in dire need of purified
water as they are purchasing the water from the open market. The people have to purchase the
water in litre basis from the market with industry price. Aquatek Pro Water Organisation has
identified the need for safe drinking water as it can impact on the health of individual and on the
entire community. Aquatek Pro Water Organisation will make a budget at first to make out how
much money does it cost to make the water purifier station and how much land does it need to
establish the water purification station. At first stage, water from nearby lakes and rivers will be
screened as it contains any natural contamination. The experts will then check the water through
adding alum into it and this process is called coagulation. The heavy particles sit at the bottom
and the experts will find the pure water. The process of filtration will also be done in order to
make the water purer. Aquatek Pro Water Organisation will use disinfecting chemicals in the

water tank. In addition, the water will be sold in bottles and Aquatek is planning to sell the
bottles with 1, 2 and 5 litres bottle packs. The water purifier station will recruit people from the
nearby area of Dockland and it will provide employment to the people. The distribution channel
will be simple and the water bottles will reach the customers in a smooth way.
Discussion of the financial, environmental and ethical implications of social innovation and
how social innovation contributes to the common good
Water purification can play an important role to access of drinking water as safe drinking water
is needed for the common people. If people have to purchase the water, it leads to getting higher
the living cost. Water is the necessary thing and drinking water must be safe. Aquatek Pro Water
Organisation takes the funding from Fonterra and impact of investment always presents an
appealing promise. The aim of the philanthropic investment is to be gained financial returns that
provide a source of economic sufficiency for the investor (Dees 2017). Aquatek Pro Water
Organisation wants to have financial returns from the water purifier station through selling the
water bottles to the community people. The community people need purified water and this
water purified station will meet the needs of the people. Social innovation always entails the
experiment and it is associated with the financial risks (Phillips et al. 2015). Therefore, Aquatek
Pro Water Organisation wants to expand the business when they would see the increase in selling
of the water bottles. The investors must be aware of the iron cage made by the expectation of
financial returns and they can leverage financial impact through social innovation.
Aquatek Pro Water Organisation will not use any technology that would emit harmful gas
and the technologies would be sustainable. The technologies will consume less energy, therefore,
the technologies and equipment will have a lower impact on the environment (Nicholls & Dees

2015). The bottles of Aquatek Pro Water Organisation will have reusable value and the bottles
can be reused. In addition, the water purifier station will have an urban gardening where plants
will provide shadow. Therefore, the whole planning of social innovation will provide protection
and restore the eco-system (Habibi et al. 2014). The labelling of the water bottles will say about
environmentally friendly choices.
Aquatek Pro Water Organisation will follow the ethical framework that stems from the
operational principles. This water purifier station will design with benefits of the users and this
water purifier station will not harm the society. The management body will understand the
ecosystem and it would build for sustainability. The work process of the water purifier station
will be collaborative and the collaboration will be done with the people across the nearby
society.
This social innovation concept will do the social good as it would provide purified water
to the common people with cheap pricing strategy and the employees will be chosen from the
nearby society (El Ebrashi 2013). The employment opportunity will be provided to the people
along with urban garden amidst the concrete forest. The recycle bottles will be reusable. The
rising issue of inequality, interconnectedness of the communities and lowering level of trust
among the people can be solved through the social innovation process.
Discussing significant implementation challenge
Political uncertainty austerity and steep competition are rapidly changing the condition of
the business for social enterprises (Nicholls et al. 2015). Fonterra will fund the water purifier
station at Dockland; therefore, Aquatek Pro Water Organisation will not face issue regarding
investment and funding. This social entrepreneurship will face the issue of collaboration with the

community. Aquatek Pro Water Organisation need to convince the people that this water purifier
station will provide benefit through providing employment and purified water. If the business
goes larger, this entrepreneurship venture can provide large economic input in this place. Social
entrepreneurs need to work with partners and those partners values may not match with Aquatel
Pro Water Organisation and the venture may face the issue of collaboration. In addition, this
water purifier station may face the issue of retaining social purposes. This water purification
station may face the difficulty in striking the balance between new revenue and diversification
and maintain the core ethics of the water purification. Thirdly, implementation of the social
entrepreneurship will need planning. Aquatek Pro Water Organisation may want to use different
business model and it may clash with Fonterra. Income will be generated through commercial
activities and if Fonterra will ask to do diversification of the business, Aquatek Pro Water
Organisation needs to consider the risk. The focus of this social innovation should be long-term
in focus as the social entrepreneurship comes from the sustainable manner. The main aim of this
venture is to provide social benefit and commercialisation is the secondary. As stated by Herrera
(2015), social enterprises can also deliver the commercial value. Aquatek Pro Water
Organisation can opt to take additional social value to ignite the passion of social
entrepreneurship.
Conclusions
It has been observed that core elements of social innovation are related to the novelty of
social innovation is the new to the concept and entrepreneurs can apply this in a new way. From
ideas to implementation is the same as the distinction between innovation and invention. The
entrepreneurship venture must meet the social needs as the social innovation is explicitly made to
meet the recognised social needs. The process of effectiveness in social innovation is effective

than a solution as it helps to create measurable improvement in terms of the result. The concept
of water purification station in the community will enhance the society's capacity as it will
empower the people to have purified water and the employment. This water purification station
will provide new relationship and role through developing the capabilities and assets through
resources.

Reference List
Baldus, B.J., Voorhees, C. & Calantone, R., 2015. Online brand community engagement: Scale
development and validation. Journal of Business Research, 68(5), pp.978-985.
Cajaiba-Santana, G., 2014. Social innovation: Moving the field forward. A conceptual
framework. Technological Forecasting and Social Change, 82, pp.42-51.
Calic, G. & Mosakowski, E., 2016. Kicking off social entrepreneurship: how a sustainability
orientation influences crowdfunding success. Journal of Management Studies, 53(5), pp.738-
767.
Choi, N. & Majumdar, S., 2014. Social entrepreneurship as an essentially contested concept:
Opening a new avenue for systematic future research. Journal of business venturing, 29(3),
pp.363-376.
Dees, J.G., 2017. 1 The Meaning of Social Entrepreneurship. In Case of Studies in Social
Entrepreneurship and Sustainability(pp. 34-42). Routledge.
El Ebrashi, R., 2013. Social entrepreneurship theory and sustainable social impact. Social
Responsibility Journal, 9(2), pp.188-209.
Fonterra. 2018. Fonterra Grass Roots Fund Australia. Available at:
https://www.fonterra.com/au/en/What-we-stand-for/FonterraGrassRootsFundAustralia.html
[Accessed 13 Apr. 2018].