Is Social Entrepreneurship Transformational Leadership in Action?

2012 – The concept of transformational leadership captured the attention of both the social entrepreneurship and transformational leadership scholars and practitioners and argues that employees motivate themselves not only by direct rewards but also on the process before these rewards. There is an ample evidence exemplifying the role and importance of transformational leaders in creating effective and sustainable organizations and their contribution towards innovative management and leadership practices where good leaders will develop followers into good leaders as well. Transformational leadership improves organizational performance by increasing group productivity and commitment through enhancing employee self-efficacy and cohesiveness and is a collective process in which the transformational leader acts as a skillful change agent and empowers the followers by redefining the organization’s mission and vision. Even though the importance of transformational leadership in organizations is gaining more and more acceptance among both practitioners and scholars, most organizations still practice a transactional work style, where the main motivation comes from the direct reward, which is not conducive for developing transformational leaders. Therefore this report suggest that, in order to create aspiring leaders, getting involved in social entrepreneurial ventures is an effective way to groom future transformational leaders. This research explored and uncovered the relationship between social entrepreneurship and transformational leadership for the next purposes: First, to help social entrepreneurship researchers learn from the transformational leadership literature. Compared to social entrepreneurship research, the field of transformational leadership has reached a certain level of maturity so that social entrepreneurship researchers can borrow proven research methodologies and ideas from it. Secondly, this knowledge is used to develop strategies for instilling transformational leadership skills in students and practitioners aspiring to become transformational leaders.

Social Entrepreneuring as Transformational Leading

Organizations typically seem to pursue short term goals and consider their employees as expendable resources rather than the most important stakeholders. In this paper is argued that this type of organizational environment is not conducive for grooming transformational leaders. In this paper is shown that social entrepreneurship is indeed transformational leadership in action. Both social entrepreneurs and transformational leaders are motivated by shared goals which only can be achieved if groups work together rather than short term personal gains. This similarity in the theory of life has major implications for social entrepreneurs, leadership development trainers and coaches, senior executives entrusted with succession planning and developing a pipeline of future leaders within their organizations and students trying to learn leadership skills for working in both for-profit and not-for-profit organizations.This research suggest that encouraging young and upcoming managers to participate in social entrepreneurial activities could be an effective way to instill transformational leadership skills. When designing leadership development workshops, it is important to include teaching materials and case studies related to social entrepreneurship to develop transformational leadership skills. Based on the findings described in this paper, students can effectively develop transformational leadership skills by participating in social entrepreneurial ventures.

The researchers developed a framework to compare the conceptual basis of both social entrepreneurship and transformational leadership and tried to explore the similarities between the processes of social-entrepreneuring and transformational-leading using this framework. Additionally, the framework is applied to study three of the most famous social entrepreneur turned transformational leaders of our time: Mother Teresa, Mahatma Gandhi and Wangari Maathai. The research propose that helping people to experience social entrepreneuring is an effective way to instill transformational leadership skills.

Reference: Bhutiani, D., Flicker, K., Groen, A., Nair, P. (2012)  Is Social Entrepreneurship Transformational Leadership in Action?   NIKOS, University of Twente, The Netherlands and University of Texas at Dallas, USA. The full article is included in PDF.

Publicated in the “Patterns of Social Entrepreneurship Research" by Edward Elgar in Spring 2012.