Stogdill’s (1950: 3) provides an enduring definition of leadership, as an influencing process aimed at setting and achieving goals, which goes a long way in explaining why good leadership is a critical determinant for organizational effectiveness, especially in times of rapid change. In this scenario Hartigan (2005) makes the assertion that social and business entrepreneurs have characteristics in common that include the capacity to adopt a risk-taking approach to an opportunity, an awareness of the importance of being pro-active in changing strategic aims and objectives and possessing the knowledge of how to mobilize scarce resources to this end. However, social entrepreneurs identify their initiatives as delivery mechanisms for generating social value, thus they do not embrace profit as the measure of success but instead the effective provision of critical social goods, particularly to those who cannot pay. Moreover, the fundamental distinction between social and business entrepreneurs extends into the arena of operational strategy as it addresses the implications for human aspects of management.
Marchington and Wilkinson (2002: 213) cite Whittingdon’s typology of operational strategies and through this framework the distinctions between the degree “to which outcomes are perceived purely in profit maximizing or pluralistic terms, and the extent to which strategy formulation is seen as deliberate or emergent” are apparent.
The business entrepreneur can readily associate with the evolutionary strategy based on the notions of efficiency and effectiveness arising as a product of market forces. Here, in a marketplace of unregulated competition the best organizations win through whilst weaker performers may acquiesce to their assets being acquired by the higher achievers. In this neo-liberal model, the planning of deliberate strategies will tend to focus on rewarding the sales force to ensure their motivation through financial gain. Therefore, the notion of superior performance by employees in achieving sales targets is an essential organizational mechanism.
The social entrepreneur cannot ignore the dynamics of the evolutionary strategy however, to fulfill the aim of generating social value, this approach should be synthesized with the systemic operational strategy. This is based on the prevalent cultural and institutional interests that are discerned from the dominant norms of society with less emphasis on the strengths and weaknesses of employees. Thus, a strategy would be legitimised by a group consensus of all stakeholders that offers the social entrepreneur a culturally acceptable means of authenticating decisions and actions.
Ambiguities and Ambivalences in the Social Enterprise Management Environment
In rejecting the traditional boundaries that separate the ‘social” and the “business” worlds the social entrepreneur faces six paradoxes as neo-liberal managerialist values and practices are superimposed onto a social politico-administrative system.
Paradox 1:
Social entrepreneurs in utilizing their organization’s assets must manage “efficiently” and “effectively”, and so be accountable for measurable, cost effective “inputs” which are used to produce “outputs.” These “outputs” when related to social value, may be difficult to quantify, or even conceptualize. Moreover, the “outcomes” generated by the “outputs” may also be difficult to measure, or even conceptualize.
Alternatively, in the private sector scenario, outputs are certain and outcomes measurable as profit. Furthermore, objectives are expressed statistically and relate to short-, medium- and long-term strategic planning enshrined in an unambiguous mission statement.
Paradox 2:
That while results-oriented behavior is encouraged, rewards for over-achievement might well be limited with social enterprises often operating in unattractive business locations with low profit margins. Additionally, with staff poorly remunerated, and possibly on part-time or fixed term contracts, an unwillingness could exist to not adequately address failure to achieve expected targets.
Alternatively, in the private sector, bonus schemes can be initiated and sanctions applied to those who fail to attain the expected levels of productivity.
Paradox 3:
That those social entrepreneurs, from an evolutionary perspective, are motivated not to tolerate sub-optimal performances even when such performances conform to cultural norms and any challenging of them is likely to generate interpersonal conflicts.
Alternatively, in the private sector, employee culture embraces long hours, quick delivery and an aversion to absenteeism.
Paradox 4:
That social entrepreneurs are expected to increase both quality and productivity while at the same time decreasing costs to ensure sustainability in marketplaces that are very price sensitive.
Alternatively, in the private sector, businesses aim to achieve adequate capitalization by operating in lucrative, sometimes niche, markets where profit margins can accommodate adequate interest and/or dividends payments.
Paradox 5:
That social entrepreneurs need to adopt a relational view of their strategic stakeholders that includes their employees, their customers, suppliers and community institutions. In this relationship the stakeholders are the objective, or ends, of the cycle of entrepreneurship as they become recipients of the social and financial capital generated by the enterprise (Ridley-Duff and Bull, 2011: 208).
Alternatively, in the private sector, businesses regard their stakeholders as a means of accumulating capital and producing products that will have utility value.
Paradox 6:
That social entrepreneurs are expected to share a significant degree of decision-making power with their subordinates, which is rooted in the concept of associative entrepreneurship that leads to collective action. However, whilst decisions may be taken on a consensual basis, entrepreneurs are unable to devolve accountability for the consequences of those decisions (Ridley-Duff and Bull, 2011: 208).
Alternatively, in the private sector, responsibility will be devolved to subordinates within what is regarded as practical and realistic by shareholders, suppliers, customers, employees and regulators.
Each of these six paradoxes can be understood as self-referential, self-contradictory cycles, which need to be accommodated:
by being re-framed as a puzzle, a conundrum or a complexity;
by being placed into its broader organizational or societal context, to diminish its apparent absurdity, contradiction or hypocrisy; or
by addressing the emotional responses stimulated by a paradox.
Thus, for the social entrepreneur, learning how to managing efficiently and effectively in such an environment requires the inculcation of philosophies and paradigms that can help social entrepreneurs cope with ambiguity, complexity and indeterminacy.
Managing Ambiguity, Complexity and Indeterminacy
To address the challenge of operating in a paradoxical environment social entrepreneurs will need to endeavor to acquire knowledge of attaining a more accurate apprehension of the true causality of organizational phenomena, and so enabling them to avoid the deceiving phenomena of “naive consciousness”, under which they treat causality as an established static fact that is superior to, and in control of, other facts. Attaining wisdom involves a learning process that improves understanding of the relationship between knowledge, decisions and action (Weick, 1995). Such wisdom must encourage both management and organizational values and perspectives to be formed, reframed or laterally re-conceptualized, in order to help make sense of the options available in relation to future courses of actions and the basis of their selection, which comes under the rubric of “instrumental judgment”, as distinct from “moral and political judgment”, both of which are particularly relevant to the social politico-facilitator role of the social entrepreneur (Dixon, Sanderson and Tripathi, 2004).
Judgment, as an irreducible part of social enterprise, requires a capacity to place information into an appropriate, even if a somewhat paradoxical, value framework to determine how best to blend and manage contradictory demands and pressures. It is a sobering thought that in the search to increase individual capacity to make informed judgments there is no science that will help the social entrepreneur better perform her or his essential and characteristic functions. This warning notwithstanding, for those wishing to develop their management skills the techniques of decision-making should be their primary focus, rather than gaining knowledge of management techniques. This, in turn, requires the concurrent enhancement of (1) the social entrepreneur’s ability to analyze relevant value frameworks; and (2), the social entrepreneur’s cognitive processes, especially those that transcend formal logic to explore the “dialectical operations” in adult thought, notably, the spirit of inquiry. This may be achieved by encouraging entrepreneurs to ask and discover important questions and problems then to individually engage in reflection. Such a process aims to facilitate the transformation of perspectives by encouraging entrepreneurs to become critically aware of the efficacy of their specific perceptions, meanings, behaviors habits and their underlying value judgments.
The fundamental challenge that is central to the social entrepreneur’s reflective managerial process is the issue of cultural change. This might well be characterized as the need to create a common understanding amongst stakeholders, customers as well as employees, in an agenda of “reflection, conversation and learning together” (Ind, 2012). This connects with the concept of “cultural change as the reframing of everyday life” (Alvesson, 2013) in a scenario where contending pre-dispositions about an enterprise’s business and social priorities might well affect the development, and possibly the continuation, of the organization.
Thus, to begin to address ambiguities it is asserted that, rather than announcing a grand project, the managerial approach should be “incremental and informal”…”avoiding a set of distinct activities that are supposed to accomplish a predefined ideal”…and instead, through constant consideration of ethical and cultural outcomes endeavoring to influence stakeholders…”in terms of meanings, values and thinking” (Alvesson, 2013: 189). This strategy resonates with Bourdieu (1976, 1984, 1990 and 1998) and the gradual process of transcending epistemological differences, rooted in objective or subjective understandings, through rejuvenated cultural awareness.
The Implications for Leadership and the Social Entrepreneur
Leadership, as a subject in relation to enterprise, evokes mixed reactions especially in the context of the ambiguous and changing perceptions about the efficacy of unfettered markets. Following the 2008 crash, characterized by unprincipled egotism and hedonism, the necessity to rethink capitalism seemed to be a logical imperative. Nevertheless, the belief that fundamental neo-liberal principles should shape “the language and unconscious assumptions” (Hanauer and Liu, 2012) of global economic policy remains prevalent.
Therefore, the social entrepreneur must strive to achieve a “higher purpose” mode of leadership in a setting of increasing complexity and uncertainty where conflicting values, attitudes and beliefs can be present. Additionally, the demands imposed by a shared-power environment (Henton, Melville and Kimberley 1997) need to be accommodated together with tensions that may arise from inter-organizational and cross-sector partnerships. This necessitates leadership capability from the apex to the service-delivery coalface along both lateral and vertical lines. Moreover, this leadership must be capable of leading in an ethically informed manner that can have a positive, transformational influence on its followers (Ridley-Duff and Bull, 2011). Therefore, leadership is not only about ‘implementation’ but the ‘enactment’ (Weick, 1995), or emergence (Allison and Hartley, 2000) of outcomes. This creative style of guidance requires establishing frameworks and contexts within which new developments and outcomes can be nurtured and facilitated, influenced and persuaded. This must allow scope for negotiation and consensus building while retaining essential, although minimal, elements of command and authority.
For the social entrepreneur the rationale underpinning leadership is the ability to build capacity, empower, and represent teams within organizations and stakeholders in the community-at-large, with particular emphasis on leadership empowerment processes. This is useful because social entrepreneurship operates in a scenario that must involve the complexity and chaos of a public sector continuing its attempt to embrace private sector norms, and a private sector that has been discredited through an erosion of public trust. Therefore, those who lead social enterprises need to promote organizational learning (Weick 1976, Weick and Westley, 1999; Brunsson, 1985; Argyris, 1990; Senge, 1990; Dixon, 1994) in a paradigm that embraces solidarity, integrity, equity and transformational action. Incremental leadership also requires not only improvising and leveraging small wins, as learning moments, in an arena of chaos and complexity (Weick, 1976, 1995) but also achieving a balance between influencing and persuading, negotiating and empowering, not only within the organization but also at the crossroads of different cultures and organizations (Hartley and Allison, 2000). This also means, following Kotter (1990), that there is a need to avoid the dilemmas of a social enterprise being over-managed and under-led, or of a re-activist leadership strategy being promulgated. Getting this balance right is important in creating the vision for a social enterprise to implement new initiatives and strategies, and to manage ambiguity and the implementation of cultural change.
The ideal-type social entrepreneur must now be akin to Nietzsche’s ([1883-85] 1968) existential Ürbermensche — the heroic superman — the incarnate will to power who challenges convention and forever seeks self-realization, for she or he must be:
• A visionary leader with energy and resilience;
• An effective persuader and communicator;
• A consensus-seeking decision-maker willing and able to make timely decisions;
• A networker capable of solving problems;
• A committed life-long learner able to integrate readily new ideas and learn new behaviours; and even,
• A successful entrepreneur.
Conclusion
This paper identifies six paradoxes that encompass several issues. These include contentions over (1) the imperatives of efficiency, effectiveness and economy as against equity; (2) the desired level of control to be exercised by social entrepreneurs over programme design and implementation; (3) the just and effective accountability of staff in relation to their remuneration and answerability and (4) the desired culture of social enterprises, which have traditionally promulgated a safe, stable and predictable employee job environment.
If a paradox is to be addressed then organisational creativity must be stimulated. In this nexus, lateral thought becomes critical. The challenge is to stimulate the art of judgement, which can only flourish through the application of the demanding techniques of reflection. This requires inspired critical self-evaluation and self-deprecation by those confronting the ambiguities created by the paradoxes. Therefore, a testing, but rewarding, reflexive procedure is needed to accommodate the necessary non-rational perspectives as well as rationalist approaches to problem solving and decision-making.
Thus, leadership in an inevitably ambiguous social enterprise arena must become the prerogative of those with creative insights and the capacity for rigorous analysis and evaluation, for only they can cope with ambiguity and indeterminacy. In this scenario, it will be necessary to foster leaders who are prepared to devote themselves to a career that demands that they be capable of perpetual transfiguration and optimal opportunism, and able to oscillate, as necessary, between contending ontological and epistemological beliefs.
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