Transcript

> Academy o/ Managemeni Learning & Educafion, 2012, Vol. II, No. 3, 463-478. http://dx.doi.org/10.5465/amle.2011.0021

A Paradoxical LeadershipModel for Social Entrepreneurs:Challenges, Leadership Skills,

and Pedagogical Tools forManaging Social andCommercial Demands

WENDY K. SMITHUniversity of Delaware

MARYA L. BESHAROVCornell University

ANKE K. WESSELSCornell University

MICHAEL CHERTOKDigital Divide Data

Social enterprises offer the promise of financially sustainable organizations that can respondto the world's most pressing problems. Yet for social enterprises to succeed their leaders musteffectively manage conflicting demands that arise from dual commitments to improvingsocial welfare and achieving commercial viability. While existing research highlights distinctskills for enabling social missions or for achieving business outcomes, we draw on paradoxresearch to buiid theory about the challenges and associated skills for effectively managingthe tensions emerging from the juxtaposition of social mission and business outcomes. Wethen use two exemplary settings for educating social entrepreneurs, one in the classroom andone in the field, to illustrate pedagogical tools for teaching these skills. Integrating thesechallenges, skills, and pedagogical tools, we propose a paradoxical leadership model forsocial entrepreneurs.

The quality of human life on the planet has neverbeen better and never been worse. Forces for glo-balization, innovation, and competition are open-ing new technological and economic frontiers

We appreciate the reflections and insights from the operators,managers, and board members of Digital Divide Data and thestudents in the Social Entrepreneurs, Innovators, and ProblemSolvers course. We are also grateful to Associate Editor NelsonPhillips and three anonymous reviewers. The development of thismanuscript was supported in part by funds from the Center forInternational Studies at the University of Delaware, the Center forIntegrative Leadership at the University of Minnesota, and theInstitute for the Social Sciences at Cornell University.

while simultaneously exacerbating human rightsviolations, financial injustice, and environmentaldevastation. Social enterprises have grown in re-sponse, using innovative ways to address societalills that frequently rely on commercial venturesand earned income (Dees, 2001; Tracey, Phillips, &Jarvis, 2011). These organizations have the poten-tial to harness the creativity, efficiency, and via-bility of commercial means in service of socialends such as improving human and environmentalwelfare.

Social entrepreneurs play a key role in realizingthis potential. Increasingly, research has explored

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the characteristics of effective social entrepreneurs,specifically highlighting their differences from tradi-tional entrepreneurs (i.e., Tracey & Phillips, 2007).Dees (2001) categorized social entrepreneurs as"one species in the genus of entrepreneurs" (2), akey distinction being their commitment to socialchange. Indeed, scholars depict social entrepre-neurs as heroic individuals (see Seelos & Mair,2005), who possess the business savvy and deter-mination of entrepreneurs, in addition to a relent-less passion for their social mission (Bomstein,2004; Thompson, 2002). The key message of thisresearch is that managing a social mission re-quires a unique set of skills beyond those neededto achieve an organization's commercial goals.

However, the social and commercial sides of asocial enterprise are not isolated from one another.Rather, they are inherently interrelated and oftenconflicting. Attending to both the social and finan-cial might benefit the organizational overall, yetthese different pursuits are often associated withcompeting identities, value systems, and norms(Battilana & Dorado, 2010; Tracey et al., 2011). Man-aging the tensions that arise is a critical skill forsocial entrepreneurs (Dacin, Dacin, & Matear,2010). Doing so requires more than just skills inarticulating and measuring a social mission orentrepreneurship skills in effectively driving com-mercial operations, each of which has been thefocus of past research. It also requires skills forembracing conflicting social and economic de-mands. Yet, aside from a few notable exceptions(i.e., Tracey & Phillips, 2007), social enterprise re-search offers little insight into the skills that en-able social entrepreneurs to attend to these com-peting demands.

We address this gap by developing theoryabout how leaders of social enterprises can cul-tivate skills for managing competing social andfinancial demands. Specifically, we addressthree questions. First, what are the leadershipchallenges posed by attending to the competingdemands of social enterprises? Second, whatskills do leaders need to effectively respond tothese challenges? And third, what pedagogicaltools can we use to help social entrepreneursdevelop these skills?

We address our first two questions by drawingon a growing body of research on paradox theory(i.e., Lewis, 2000; Smith & Lewis, 2011). Paradoxtheory offers insight into the nature and manage-ment of competing demands in organizations.Based on this theoretical approach, we argue thatthe inherently competing demands that arisewhen organizations pursue social missionsthrough commercial means create two chal-

lenges for social enterprises. First, social enter-prises risk losing their dual focus and becomingeither purely social mission-oriented or purelycommercial. Second, social enterprises risk be-coming mired in intractable conflict betweenmembers representing the social and commer-cial sides of the organization, respectively. Lead-ers of social enterprises therefore face twin chal-lenges: They must maintain commitments to boththeir social mission and their business plan, andthey must effectively manage internal conflictbetween these two sides of the organization.Three interrelated leadership skills enable man-agers to attend to these challenges: accepting,differentiating, and integrating competing de-mands. Accepting involves viewing both socialand financial demands as simultaneously possi-ble. Differentiating entails recognizing theunique contributions of each demand. Finally,integrating focuses on bringing social and finan-cial demands together such that conflict betweenthem becomes productive rather than intracta-ble. By linking paradox theory with social entre-preneurship, our contribution in this section is toexplicate specific challenges associated withmanaging competing social and commercial de-mands and link those challenges to critical lead-ership skills.

We address our third research question by usingtwo exemplary models of teaching social entrepre-neurship—one in the classroom and one in thefield-—to illuminate specific pedagogical tools fordeveloping these leadership skills. Social Entre-preneurs, Innovators, and Problem Solvers (SEIPS),an undergraduate course at Cornell, was recog-nized by Ashoka in 2010 as one of 10 exemplaryuniversity syllabi around the world for teachingsocial entrepreneurship. Digital Divide Data(DDD), a 10-year-old social enterprise in south-eastAsia, won awards and grants from the Skoll andRockefeller Foundations reflecting, in part, theirsuccess in teaching social entrepreneurship skillsto new generations of leaders. By drawing on ex-amples of teaching social entrepreneurs in theclassroom and field, our contribution in this sec-tion is to illustrate theory in action, demonstratingpedagogical tools that can help leaders developspecific skills in these two distinct settings. Takentogether, the challenges, leadership skills, and ex-amples of pedagogical tools we discuss here offera model of paradoxical leadership for social entre-preneurs that highlights the difficulties of the in-herently conflicting nature of their endeavor aswell as the opportunities for effectively managingtheir competing demands.

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SOCIAL ENTERPRISES:PARADOXICAL CHALLENGES AND CRITICALLEADERSHIP SKILLS

Social enterprises seek to affect positive changeand create social value through entrepreneurialinnovation (Dees, 2001). Broadly, this definition in-cludes organizations that focus almost exclusivelyon a social mission, such as not-for-profits, govern-mental agencies, and foundations (Dees, 2007). Yetsocial enterprises frequently adopt commercialmeans to achieve the social ends they pursue (Da-cin et al., 2010; Dacin, Dacin, & Tracey, 2011). Wefocus here on this type of social enterprise becausesuch organizations face a unique set of challenges.In particular, even as social entrepreneurs adoptcommercial endeavors in service of a broader so-cial mission, they experience operational conflictsbetween social and financial demands. Beyond theskills needed to manage either a social mission ora commercial venture, leaders of these social en-terprises also need skills for managing the ten-sions and conflicts between these competingdemands.

Paradox theory offers insight into the challengesassociated with managing the conflicting de-mands of a social enterprise and the skills bywhich such challenges can be addressed. Paradoxrefers to "contradictory, yet integrated elementsthat exist simultaneously and persist over time"(Smith & Lewis, 2011: 382). Organizational studiesof paradox explore how leaders respond to contra-dictory elements, or underlying tensions, in orga-nizations (Poole & Van de Ven, 1989). When tensionsfrom competing demands become salient, theyelicit strong, often defensive, reactions among or-ganizational leaders that can lead to potentiallydetrimental responses (Lewis, 2000). As an alterna-tive response, leaders can embrace inconsisten-cies and seek to support contradictory elementssimultaneously. Doing so can result in creative,beneficial alternatives (Cameron & Quinn, 1988;Poole & Van de Ven, 1989; Smith & Lewis, 2011).

In social enterprises, pursuing social missionsthrough commercial means gives rise to paradox-ical tensions between competing social and finan-cial demands (for a discussion of competing de-mands in social enterprises see Tracey et al., 2011).Commercial viability is based on economic values,whereas social missions are grounded in societalvalues. While pursuing commercial viability en-courages efficiency, pursuing social missions im-plies a focus on effectiveness in addressing socialproblems (Epstein, 2008). While pursuing commer-cial viability involves attending to a more narrowset of shareholders, pursuing social missions ex-

pands the focus to a broader group of stakeholders(Brickson, 2007; Donaldson & Preston, 1995).

Competing demands can evoke defensive reac-tions among organizational leaders, who oftenseek to avoid rather than confront tensions (Lewis,2000). First, the contradictions and inconsistenciesthat arise in the face of social and financial de-mands create anxiety in social entrepreneurs, be-cause they complicate our linear logic, confuse ourrationality, and threaten our egos (Vince & Brous-sine, 1996). Such anxiety often results in a feelingof being stuck (Smith & Berg, 1987). In response,individuals seek strategies for consistency to re-gain clarity and control (Cialdini, Trost, & New-som, 1995), including splitting, polarizing, andchoosing between opposing forces (Lewis, 2000).Yet choosing one option can lead to extreme be-haviors to advocate for that choice. Escalatingcommitments continually reinforce a chosen op-tion and ensure its preservation (Staw, 1976), ulti-mately resulting in the dominance of one side ofcompeting demands over the other. For social en-terprises, this means losing their joint social andcommercial focus, as leaders repeatedly choose toprioritize either the organization's social missionor its commercial viability. Thus, although theyinitially pursue both, social enterprises can beginto look more like traditional for-profit entrepre-neurships on the one hand or traditional not-for-profit organizations on the other. For example, asthe microfinance field grew, some organizationseventually held initial public offerings and em-phasized their financial performance, much to thecriticism of people such as Mohammed Yunus,Grameen Bank founder and Nobel Laureate, whosuggested that these organizations lost their socialpurpose (Yunus, 2011). Tracey and colleagues'(2011) study of Aspire, a U.K.-based social enter-prise, illustrates the opposite problem. Financialproblems led Aspire to increasingly focus on itssocial goals and lose sight of its commercial via-bility, which ultimately contributed to the organi-zation's demise. This tendency to overemphasizeeither social mission or commercial viability to thedetriment of the other creates a challenge for so-cial entrepreneurs, who must maintain commit-ments to both.

Second, competing social and commercial de-mands can lead social entrepreneurs to becomemired in intractable conflict, particularly whenthese demands are associated with distinct sub-groups within the organization. Group commit-ments can emerge with limited initial collectiveengagement, and group membership serves to in-tensify continued commitment (Tajfel, 1970). As aresult, polarization can occur even when there are

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few tensions between groups. Moreover, Fiol, Pratt,and O'Connor (2009) argue that when threatened,group members not only support their own per-spectives, but they also define who they are byrecognizing how they are not like opposing groups.This process exacerbates the distinctions betweencompeting groups. In the extreme, such polariza-tion can lead to intractable conflicts characterizedby entrenched competition and mistrust betweengroups over a long period of time. For example,Battilana and Dorado (2010) describe ongoing con-flict in a Bolivian microfinance organization be-tween loan officers who sought to promote the or-ganization's financial success and those whosought to promote its development and social wel-fare objectives. The inability to address this ten-sion resulted in declining organizational perfor-mance. Because the tensions between social andcommercial demands can become so pervasiveand detrimental, they create a second challengefor social entrepreneurs, who must overcome in-tractable conflicts.

While these twin challenges of managing socialenterprises—sustaining dual commitments andovercoming intractable conflict—may seem insur-mountable, research suggests not only that orga-nizational leaders are capable of sustaining com-peting demands, but also that the juxtaposition ofsuch tensions can be a source of organizationalsuccess (Cameron, 1986). The integration of oppos-ing forces can encourage novel, creative solutionsthat ultimately enable long-term organizationalsustainability (Smith, Lewis, & Tushman, 2011). Forexample, social enterprises can benefit from inte-grating the competing demands associated withsocial missions and commercial viability. Pursu-ing commercial viability promotes efficiency, per-formance, innovation, and growth. In contrast, so-cial missions elicit passion, motivation, andcommitment. Taken together, the dual forces forperformance and passion offer a powerful combi-nation that can lead to new solutions to existingchallenges. For example. Fair Trade organizationsfound novel ways of addressing the problems offluctuating commodity prices for both markets andfarmers. These organizations support local agri-culture and small, family farmers while alsosmoothing out commodity prices in the market foritems such as coffee and bananas. They do so bycreating local farming cooperatives, ensuringfarmers fair prices over time, and extending credit(Audebrand 8f Pauchant, 2009).

How can this positive potential be realized? Ben-efiting from competing demands depends on indi-viduals, specifically organizational leaders, em-bracing, rather than resisting or rejecting

Taken together, the dual iorces iorperformance and passion oííer apoweriul combination that can lead fonew solutions to existing challenges.

competing demands (Beech, Burns, de Caestecker,Macintosh, & MacLean, 2004; Clegg, Cuhna, &Cuhna, 2002). Paradox research has identified sev-eral strategies for achieving such benefits (Andrio-poulos & Lewis, 2009; Poole & Van de Ven, 1989;Smith & Tushman, 2005). Drawing from this re-search, we propose three meta-skills that enablesocial entrepreneurs to more effectively embracecompeting demands: acceptance, differentiation,and integration. Acceptance involves acknowledg-ing competing demands as an inherent part oforganizations and learning to live with them. Dif-ferentiation focuses on recognizing the unique con-tributions of each alternative, whereas infegrafionentails simultaneously addressing both alterna-tives and seeking synergies between them.

All three skills are necessary for managing thechallenges posed by competing social and com-mercial demands (Smith & Lewis, 2011). Accep-tance provides a vital foundation upon which in-dividuals can reduce anxiety, minimize conflict,and mindfully seek alternatives (Fiol, 2002). In thisway, acceptance broadly addresses both chal-lenges posed by competing demands. Luscher andLewis (2008) found that in the midst of a changeeffort at Lego, accepting paradoxical tensions en-abled managers to make sense of organizationalchallenges in new ways. Differentiation highlightsthe value of each alternative, and helps leadersavoid the potential for one alternative to continu-ally dominate the other. In this way, differentiationspecifically addresses the challenge of maintain-ing focus on both sides of competing demands.Smith, Binns, and Tushman (2010) argue that whensenior leaders adopt practices to highlight distinctelements of conflicting demands, they avoid re-peatedly prioritizing existing strategic competen-cies over new ones. Finally, integration offers thepossibility for new, creative solutions to emergeand thereby specifically addresses the challengeof overcoming intractable conflict. Yet, paradoxi-cally, integration depends on effective differentia-tion. Differentiation can help leaders identifynovel features of each side of competing demands,which in turn enables them to develop more cre-ative ways of integrating these demands (Sued-feld, Tetlock, & Streufert, 1992). Andriopoulos andLewis (2009) show that product development teams

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most effectively attend fo competing demandswhen they combine differentiation and integrationstrategies.

Figure 1 summarizes the relationship betweenthe two distinct challenges facing social entrepre-neurs and the three meta-skills for attending tothese challenges. In fhe next section, we describemore specific skills associated with each of thesemeta-skills and discuss pedagogical tools that canhelp social entrepreneurs to develop them.

PEDAGOGICAL TOOLS FOR MANAGINGCOMPETING DEMANDS

Developing meta-skills of acceptance, differenti-ation, and integration is challenging. It requireshelping leaders shift their mental models fromformal, rational logic to self-referenfial and dis-cursive thinking (Ford & Ford, 1994), reframe con-tradictions from "either/or" dilemmas to "both/and" possibilities (Bartunek, 1988), and useinterpersonal skills to surface rather than sup-press tensions (Smith & Berg, 1987). Effective ped-agogy must go beyond informational approach-

es; if must provide transformational experiences(Snook, 2008).

To demonstrate pedagogical tools for develop-ing the meta-skills of acceptance, differentiation,and integration, we draw from two exemplary ed-ucational settings that adopt transformationalrather than simply informational techniques. Ourgoal in this section is fo be illustrative. Thus, whilewe draw our examples from award-winning set-tings, the pedagogical tools we discuss are neithercomprehensive nor systematically induced.

The first exemplar is an award-winning under-graduate course at Cornell University, Social En-trepreneurs, Innovators, and Problem Solvers(SEIPS), which offers insight into teaching socialentrepreneurs in a classroom setting. Social Entre-preneurs, Innovators, and Problem Solvers seeks todevelop social entrepreneurs in a highly interac-tive, experiential, and dynamic course. Working insmall groups, students engage in substantial re-flection and exploration to develop a deeper un-derstanding of their personal mission and valuesand also complete a consulting project with a localsocial enterprise. The curriculum further makes

Challenges

Mela-Skills

SpecificSkills

Examplesof

PedagogicalTools

C = ClassroomF = Field

Maintaining both social missionand commercial viability Overcoming intractable conflict

Acceptance

Differentiation

Recognizing tinedistinct value of

each domain

Mindfullyattending todistinctions

between domains

Integration

Developing trust,openness, and

culturalsensitiv i t>'

Seeking s\-nergiesill dec i s ion-

making

Embed mission and business !plan development in course istructure (C) |"Big Idea" project (C) iDirect mission impact Iexperience (F) ¡Mini-MBA program (F)

Abundance-based gradingand course assignments (C)Gratitude exercise (C)Instructor role modeling (C)Abundance-basedcollaborations (F)

Divergent thinking exercises(C)Social mission metrics (F)Separate financialstatements (F)

Paradoxical thinking models(C)Overarching vision (F)Experimentation indecision-making (F)

Field projects (C) |Transformation groups (C) |Culture of openness (F)

"Big Idea" project (C)Role modeling integrative

ae<decision-making (C. F)

FIGURE 1A Paradoxical Leadership Model for Social Entrepreneurs

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use of firsthand accounts from local and nationalsocial entrepreneurs, through face-to-face interac-tion, books, and films. Initially adapted from anAshoka award-winning syllabus developed byScott Sherman at UCLA, the SEIPS syllabus wasindependently recognized in 2010 by Ashoka for itsunique curricular developments and selected to beone of 10 exemplary syllabi for teaching socialentrepreneurship at universities around the world.

Students report that this class significantly sup-ported their development in becoming social en-trepreneurs. Of the 125 students who have com-pleted the SEIPS course over the four semesters ithas been offered, at least 11% of the students (14out of 125) either work for an existing social enter-prise or founded a new social enterprise organiza-tion.^ In addition, alumni have been finalists orwinners of the "Big Idea" undergraduate businessplan competition at Cornell and Harvard Universi-ty's "Business for Good" business plan competi-tion, using the ideas they generated in the course.Moreover, in written feedback on the course, stu-dents named several of the pedagogical tools wediscuss below as instrumental in helping preparethem for their current work in social enterprises.

The second setting. Digital Divide Data (DDD),illustrates exemplary tools for teaching social en-trepreneurship while "on the job." Digital DivideData is a global social enterprise that seeks tobreak the cycle of poverty in developing countriesby educating and employing disadvantaged peo-ple in a for-profit information technology business.Founded in 2001 with one office in Cambodia, DDDnow operates three offices across south-east Asiaand recently opened an office in Kenya. DigitalDivide Data provides labor intensive IT servicessuch as data entry and web and video tagging. Byproviding employment along with formal and in-formal training, DDD offers its entry-level opera-tors opportunities to develop skills and knowledgeto move into higher paying jobs and a higher so-cioeconomic class. Digital Divide Data's success inachieving its social mission is evident in the em-ployment opportunities it provides: DDD currentlyemploys over 750 people and has "graduated" over500 people into jobs that pay an average of fourtimes the average national salary in the coun-tries in which it operates. The organization hasaccomplished this while simultaneously devel-oping a profitable business operation. Digital

' These data were collected from an informal survey of formerSEIPS students conducted in 2012. While they do not represent astatistically significant sample, they offer illustrative data tosuggest the impact this course has on the development of socialentrepreneurs.

Divide Data had $2.3 million in revenues and$30,000 in profits in 2010. In recognition of both itssocial and commercial success, the organizationhas been awarded million-dollar grants from theRockefeller Foundation and the Skoll Foundationfor social entrepreneurship.

Digital Divide Data is not only a highly success-ful social enterprise; it is also an exemplar ofteaching social entrepreneurship in the field. Akey element of DDD's success is the focus on learn-ing by doing, as they teach their operators how tobecome managers and leaders of social enter-prises. Three members of DDD's senior manage-ment team in south-east Asia developed fromfrontline operators into organizational leaders,and overall 21% of the approximately 500 operatorswho have "graduated" into higher paying jobs arein management positions within DDD. Others haveleft DDD to start their own social enterprises. Atone of DDD's offices, for example, 25% of the 28external "graduates" (i.e., graduates employedoutside of DDD) are working in social enterprises.Moreover, when asked to reflect on their experi-ence at DDD for an essay collection in honor of theorganization's 10th anniversary, current employ-ees and alumni noted that the skills they devel-oped through their work at DDD helped them cre-ate social change.

Skill 1: Acceptance

Acceptance involves viewing both sides of compet-ing demands as simultaneously possible, even ifthey are inherently in conflict. By accepting para-doxical demands, leaders recognize them as anopportunity and "invitation to act," rather than asan obstacle (Beech et al., 2004). In this way, accep-tance is a foundational skill for social entrepre-neurs, providing a necessary starting point foraddressing the challenge of maintaining com-mitment to the social mission and commercialviability as well as the challenge of overcomingintractable conflict. We highlight two specificskills associated with acceptance—adopting anabundance mentality and embracing paradoxi-cal thinking—and we describe below pedagogi-cal tools for teaching these skills in the class-room and the field (see Figure 1).

Adopting an Abundance Mentality

An abundance mentality involves attending to re-sources as plentiful, regenerative, and enablingrather than as scarce and limited. When faced witha seeming dilemma or tension, abundance think-ing reframes the focus from problem solving to

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possibility finding (Cameron & Lavine, 2006) andshifts decision making from a competitive, zero-sum approach to a collaborative, positive-sum ap-proach (Bazerman, 1998). Developing abundancethinking involves extensive dialogue and commu-nity building to see new possibilities. In this way,adopting an abundance mentality helps leadersaccept both sides of competing demands.

In the classroom, course design and structurecan be used to help students develop an abun-dance mentality. In the SEIPS course, for example,grades, a critical motivator in classroom curricula,are assigned based on the assumption that allstudents can receive high grades if they do ex-traordinary work. Students are explicitly informedthat there is no grading curve. A grading curveassumes that a limited number of students arecapable of doing excellent work, while the SEIPSapproach assumes all students have the potentialto flourish and provides them with an opportunityto do so. Moreover, course assignments are struc-tured such that, in order to do extraordinary work,students must cooperate with and support oneother, highlighting the idea that one can best suc-ceed through abundantly sharing with others. Forexample, a personal portfolio project requires stu-dents to respond to a series of 20 questions abouttheir past experience with social change, familyhistory, sources of gratitude and inspiration,strengths, values, and life goals. Instead of com-pleting this assignment independently, studentsdevelop their responses in small "transformationgroups," which are designed to be psychologicallysafe environments in which students can shareideas, receive encouragement, learn from one an-other, and begin to see new or deeper ways inwhich they could be answering the portfolioquestions.

The SEIPS course also makes use of two otherpedagogical tools that help develop abundancethinking. First, the course begins with a "gratitudeexercise" in which students share one thing theyare grateful for with a partner, and then switchpartners until they have been paired with every-one in the class. For each round, students must saysomething new, forcing them to recognize themany small things they are grateful for and tobecome aware of the abundance present in all oftheir lives. Second, throughout the semester, in-structor role modeling is used to demonstrate prin-ciples of abundance. For example, students areasked to develop three specific, measurable, andaction-oriented goals that they will accomplish bythe end of the semester. They share these goalswith their transformation group members, thenweekly develop subgoals and action steps and

provide progress reports to each other and the in-structor. The instructor provides developmentalfeedback on each student's progress reports, withcopies of the feedback sent to all members of thestudent's transformation group. Through role mod-eling, this feedback practice helps teach studentsthe value of responding to and encouraging oneanother, thereby helping them learn to act basedon principles of abundance.

In the field setting, collaborations with other or-ganizations can help managers learn to developan abundance mentality. At DDD, early partner-ships with nonprofit education organizations en-abled the organization to hire entry-level operatorsalready trained by local NGOs. Digital Divide Dataalso fostered an early collaboration with a for-profit digitization company in India that providedbenefits for both parties: The company helped DDDlearn about the industry, and DDD was ultimatelyable to subcontract work back to the company. Byengaging in these types of collaborations and ex-plicitly discussing how they contribute to bothDDD's commercial viability and its social mission,DDD's current leaders help employees learn toadopt an abundance mentality. As employees"graduate" and move on to other organizations,they bring knowledge and skills in building col-laboration, support, and community with them.Digital Divide Data leaders do not frame this shiftas losing good employees, but rather as gaining alarger social network that will benefit the organi-zation for years to come.

Embracing Paradoxical Thinking

The second skill by which acceptance can be fos-tered involves embracing paradoxical thinking. Insituations in which actors face competing de-mands, a natural human response is to approachdecisions in terms of existing categories, such asnonprofit/for-profit or social/financial. Paradoxscholars describe this as an "either/or" approach tocompeting demands (Smith & Lewis, 2011). How-ever, actors can instead be taught to embrace par-adoxical or "both/and" thinking, in which they ac-cept both sides of competing demands assimultaneously possible, enabling them to de-velop new, creative alternatives that transcend ex-isting categories (Bartunek, 1988; Lewis, 2000). Inthis way, paradoxical thinking promotes an ongo-ing acceptance of competing demands.

In the classroom setting, the models included inassigned readings provide a means of encourag-ing paradoxical thinking. In the SEIPS course, forexample, students read and discuss a story thatemploys paradoxical thinking about the relation-

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ship both Jews and Arabs have to the history andland in the Middle East (Zander 8f Zander, 2000).The child of a Holocaust survivor first recounts thestory of the Jewish people and their journey tosettle in the Middle East. This same narrator thentells the story of the Arab people and their journey,ultimately recognizing that contemporary Jewsand Arabs are all better off by developing a "WEstory" that embraces Jews' and Arabs' competingclaims, rather than adjudicating between them.The narrator of these stories argues that such astory offers a framework for "transform[ing] us ANDthose whose claims on our resources, territory, andthe 'truth' are irreconcilable with ours." A WE story"take[s] us from an entrenched posture of hostilityto one of enthusiasm and deep regard" (Zander &Zander, 2000: 182). This story encourages paradox-ical thinking by moving students away from think-ing about the Middle East as an "either/or" compe-tition between either the Jewish story or the Arabone, to thinking instead about an overarching storythat encompasses the realities of both groups.

Digital Divide Data illustrates two pedagogicaltools to help develop paradoxical thinking in thefield. The first tool involves articulating and con-necting employees to an overarching vision. Whilethe primary purpose of an overarching vision is toalign organizational members with the strategicdirection of the organization (Collins & Porras,1996), from a pedagogical perspective it alsoteaches managers and employees what is criticalin the organization. An overarching vision that ac-tively embraces competing social and financialdemands in a social enterprise communicates theimportance of accepting and embracing both thecommercial and social sides of the organization. AtDDD, for example, the company's formal mission,"provid[ing] growth opportunities for our staff andhigh quality services to our customers through sus-tainable technology-related enterprises," bringstogether its social and business objectives. TheCEO uses the mission statement to explicitly re-mind senior managers about the mutually reinforc-ing relationship between the social mission andthe business. As a DDD manager who helped de-velop the mission explained, "We are really clearnow with our senior managers that when our busi-ness grows, so does our impact, and therefore itmay be worthwhile to make some decisions thatsacrifice short-term mission to enable long-termsustainability." These personal reminders, deliv-ered in one-on-one conversations and in manage-ment team meetings and retreats, help teach man-agers to accept that while there are tensionsbetween DDD's financial and social objectives, it ispossible to accomplish both over the long term.

The second tool DDD uses to develop paradoxi-cal thinking involves encouraging experimenta-tion in decision making. In making hiring deci-sions, for example, DDD's CEO encourages seniormanagers to find ways to hire entry-level employ-ees based on both social needs and technicalskills. Managers are also given the autonomy toexperiment with different approaches. While theyinitially adopted "either/or" approaches that fo-cused on either hiring disadvantaged people withvery low skills or hiring college graduates whowere highly skilled but not particularly disadvan-taged, over time, managers learned to embraceparadoxical approaches by hiring disadvantagedpeople who could be trained to develop the skillsneeded to efficiently meet client needs.

Skill 2: Differentiation

Differentiation involves recognizing the uniquecontributions of each side of competing demandsand mindfully attending to distinctions betweenthem (Langer, 1989; Weick, Sutcliffe, & Obstfeld,1999). For social entrepreneurs, differentiating in-volves recognizing the distinct value of both socialand commercial demands, and moving beyondcoarse categorizations of these demands to attendto nuanced distinctions between them. By en-abling social entrepreneurs to recognize and dis-tinguish between social and commercial demands,differentiation skills help social entrepreneursspecifically address the challenge of sustainingcommitment to both their social mission and theirbusiness plan, thereby lessening the risk that theorganization will lose its dual focus (see Figure 1).

Recognizing the Distinct Value of Each Domain

In order to effectively differentiate, leaders mustlearn to recognize the distinct value of both thesocial and financial elements of a social enter-prise. To do so, they need to be able to articulate,develop, and measure the social mission as dis-tinct from the business plan (and vice versa). In theclassroom, course structure can be used to developskills in maintaining distinctions between the so-cial and commercial elements of a social enter-prise. In the SEIPS course, for example, distinctmodules of the course emphasize the differencesbetween each element. To help students articulatea clear and compelling social mission, the firstmodule of the course focuses on the aspirationsand goals of contemporary social entrepreneursand guides students through an exploration oftheir own personal goals and values. Studentslearn the stories of contemporary social entrepre-

2012 Smith, Besharov, Wessels, and Chertok 471

neurs through books (e.g., Jacqueline Novogratz'sThe Blue Sweater, Van Jones' The Green CollarEconomy, and Wendy Kopp's One Day, AU Chil-dren); videos (e.g., Rwanda Rising); and live dis-cussions with local and national social entrepre-neurs. The narratives they hear through thesedifferent media emphasize that social entrepre-neurship is about human dignity, creating possi-bilities, and collective well-being. The subsequentcourse modules shift the focus to help studentsdevelop a business plan and understand organi-zational structure, strategic planning, outcomemeasurement, budgets and revenue generation,and stakeholder communication. To highlight theimportance of having a viable business plan, thismodule is introduced in the syllabus with a quota-tion from Jacqueline Novogratz, the founder of Acu-men Fund, who writes in her memoir:

The world will not change with inspirationalone, rather it requires systems, accountabil-ity, and clear measures of what works andwhat doesn't. Our most effective leaders,therefore, will strengthen their knowledge ofhow to build organizations while also havingthe vision and heart to help people imaginethat change is possible in their lives (No-vogratz, 2009: 248).

Students also read and discuss Wendy Kopp's ac-count of Teach for America, in which she writes:

What I learned, in essence, was that if I wasto fulfill my mission, it would take more thanan idealistic vision. In the end, the big ideawas important and essential. But it wouldwork only with a lot of attention to the nutsand bolts of effective execution (Kopp,2003: 125).

The "Big Idea" project is a second pedagogicaltool used in the SEIPS course to help students learnto recognize the distinct value of the social andcommercial elements of a social enterprise. In thisassignment, students are first asked to identify asocial problem they seek to address, building ontheir personal development work and exposure toleading social entrepreneurs from the first part ofthe course. They then assess the significance of thesocial problem, justify their specific approach toaddressing it, articulate short- and long-term goalsand metrics for assessing their progress towardthose goals, and develop a budget and a strategyfor revenue generation. In this way, the "Big Idea"assignment helps students develop both a compel-ling vision for social change and a sound business

plan for pursuing this vision, and it helps themunderstand the need for each of these componentsof a social enterprise.

In the field, direct experience combined withclassroom teaching can serve as powerful peda-gogical tools for teaching social entrepreneurs torecognize the distinct value of the social and com-mercial sides of a social enterprise. Digital DivideData uses both types of tools. First, in order toteach managers about the social mission and helpthem recognize its value, DDD intentionally cre-ates opportunities for its North American seniormanagers and board members to have a directmission impact experience in which they witnessfirsthand the social problem addressed by the or-ganization. This is particularly important in thefield setting, because while the founder of a socialenterprise is likely to be highly committed to theorganization's social mission, other members ofthe organization, particularly newcomers, do notautomatically share this commitment. Indeed, theymay not even be fully informed about what thesocial mission is. At DDD, newly hired senior man-agers spend significant time in the south-east Asiaoffices early in their tenure, and one board meet-ing per year is held in one of DDD's south-east Asialocations. In addition, all expatriate managershired to work in Asia are required to visit thehomes of one of DDD's operators as part of theirorientation. Through this visit, they see how far theoperators commute to work and the condition oftheir homes. They meet family members and hearoperators talk about the meaning that their jobs atDDD have in their lives. Managers who participatein these visits report that they appreciate seeingoperators' backgrounds and are inspired by andgrounded in the mission. In this way, a direct mis-sion impact experience helps teach managers inthe field about the distinct value of a social enter-prise's social mission.

Second, to help managers recognize the distinctvalue of commercial viability, DDD borrows an ap-proach from the classroom and partners with aU.S.-based university to offer its managers a mini-MBA program. By teaching business skills, such asfinancial accounting, operations and process im-provement, and project management, the programgives managers the tools to develop a businessplan and achieve commercial viability, therebyhelping them recognize (and realize) the distinctvalue of this side of a social enterprise. In this way,the mini-MBA provides an important complementto pedagogical tools, such as the direct missionimpact experience, that help leaders recognize thedistinct value of the social mission. As one of theinstructors to DDD's senior managers explained.

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"Social entrepreneurs can be such zealous enthu-siasts for their social mission that they are willingfo build an ineffective business plan. They mustcontinually be reminded that the business modelhas to make sense. You cannot let the mission getin the way of the business plan."

Mindfully Attending to Distinctions BetweenDomains

In addition to developing skills in recognizing thedistinct value of the social and commercial sides ofa social enterprise, social entrepreneurs musf alsolearn to mindfully attend to distinctions betweenthese two domains. This requires not just aware-ness of the two domains as distinct, but also fheability to seek out novel information about thedomains, which in turn enables leaders to makenuanced distinctions between fhe domains.

In the classroom setting, divergent thinking ex-ercises can be used to develop skills in mindfullyattending to distinctions between domains. In fheSEIPS course, the instructor uses divergent think-ing exercises throughout the semester, by askingstudents to come up with many possible answersto a question rather than just one. For example, theinstructor will turn over a chair in the classroomand ask students, "What is this?" While studentsinitially respond by saying, "It's a turned overchair," they eventually begin to identify alterna-tives—perhaps the chair is a playground for asquirrel, the scene of a fight, or a tent for a smallchild. In another divergent thinking exercise, stu-dents list possible uses for a bottle. These exer-cises help students fo transcend their initial cog-nitive commitments fo existing categories (e.g.,chair, bottle) and to recognize that there are mul-tiple possible responses fo a problem or question.In doing so, they further help students shift awayfrom drawing initial, and often oppositional, dis-tinctions between objects or concepts, and towardidentifying new, salient features that may lead tocreative solutions. In this way, divergent thinkingexercises foster skills for attending to novel dis-tinctions that students can later call upon to attendto distinctions between social and commercial de-mands in social enterprises.

In the field setting, real data on organizationalperformance can provide the basis for another ped-agogical tool for teaching leaders to mindfully at-tend to distinctions between social and commer-cial domains. Specifically, social enterprises cancreate social mission metrics in addition to tradi-tional financial metrics and then report these met-rics in separate financial statements. For example,DDD has engaged in extensive exploration and

development of social mission metrics, throughdiscussions in board meetings, operator surveysand focus groups, and projects with outside con-sultants. Digital Divide Data then uses these met-rics to report social mission performance sepa-rately from business performance. At board andmanagement meetings, these separate reporfs pro-vide a basis for conversations about the strengthsand weaknesses of the social and commercialsides of fhe organization. Taken together, thesepractices highlight that separate data exist foreach part of the organization and help managerssee distinctions between them.

Skill 3: Integration

Integration involves identifying creative synergiesbetween contradictory elements. Doing so entailsbringing fwo sides of conflicting demands to-gether, such that conflict becomes productiverafher than intractable. In this way, integrationcan help social entrepreneurs address the chal-lenge overcoming intractable conflict between thesocial and commercial sides of the organization.Identifying integrative options requires complexthinking (Suedfeld et al., 1992), which can be de-veloped among social entrepreneurs through twospecific skills: interpersonal skills that build trust,openness, and cultural sensitivity, and decision-making skills that enable leaders to seek syner-gies rather than either/or solutions (see Figure 1).

Developing Trust, Openness, and CulturalSensitivity

Interpersonal skills of trust, openness, and culturalsensitivity can help leaders create a learning en-vironment in which ideas are openly exchanged(Edmondson, 1999) and people feel comfortableraising challenging, yet important, information(Argyris, 1988). Such an environment can promotecollaboration between organizational memberswho hold conflicting goals and values, such asmembers of a social enterprise who are stronglyattached to the social mission and those who arecommitted to the financial performance of the or-ganization. By learning from and working withmembers who represent both sides of these com-peting demands, leaders can identify new integra-tive ideas.

We highlight two pedagogical fools by whichinterpersonal skills of trust, openness, and culturalsensitivity can be taught in the classroom. First,such skills can be taught through field projectsthat require students to work with existing socialenterprises. In the SEIPS course, for example, stu-

2012 Smith, Besharov, Wessels, and Chertok 473

dents learn collaboration skills and develop cul-tural sensitivity by engaging in semester-longgroup projects with local social enterprises. Thesocial enterprises they work with are usually non-profit organizations with cultural norms quite dif-ferent from those students are familiar with fromtheir prior coursework and work experience. In or-der to effectively complete the project, studentsmust adapt their Western, market-based assump-tions and learn to see the world from the morecollaborative, relational, and locally embeddedperspective of their "clients."

Skills for developing trust, openness, and cul-tural sensitivity can also be fostered through theuse of transformation groups, such as those usedin the SEIPS course. In SEIPS, the transformationgroups meet weekly, outside of class time,throughout the semester. As described above, theyare designed to be psychologically safe environ-ments in which students discuss their personalidentity and future goals. Students also share anddiscuss feedback received on a self-reflection ex-ercise with fellow transformation group members.Throughout this process, they are expected to holdone another accountable and also to support oneanother in exploring their experiences, values, andgoals. By sharing extremely personal materialwith one another, students get to know one anotheron an intimate level, helping them learn how tobuild trust and openness. In addition, by design,group members vary in economic and politicalbackground, religious affiliation, sexual orienta-tion, and race and ethnicity. This means that stu-dents are often exposed to ideas and frameworksdifferent from their own, and they develop an un-derstanding of and appreciation for these differ-ences—that is, they develop skills in culturalsensitivity.

In the field, role modeling and explicit encour-agement can help managers of social enterprisesdevelop trust, openness, and cultural sensitivity.At DDD, for example, senior leaders actively modeland create a culture of openness, in which employ-ees provide extensive feedback and engage in con-versations about value differences. For example,at management meetings and the annual manage-ment retreat, all managers are expected to partic-ipate and express alternative points of view, eventhough doing so runs counter to dominant culturalnorms in south-east Asia. If managers are silent,DDD's CEO explicitly asks them their opinion, re-inforcing the expectation that they should offer apoint of view, and he expresses deep appreciationwhen they do participate. Over time, these prac-tices help managers learn the skills needed to

collaborate in a setting rife with value and culturaldifferences.

Seeking Synergies in Decision Making

The ability to seek synergies—that is, to make de-cisions in which both sides of conflicting demandsare upheld—is a second skill that promotes inte-gration (Suedfeld et al., 1992). One classroom toolfor teaching social entrepreneurs to seek synergiesis SEIPS' "Big Idea" project. We explained abovehow this project develops differentiation skills.Here we focus on its ability to foster integrationskills. Specifically, by combining elements fromthe distinct social mission and business skillsmodules of the course into a single assignment,the Big Idea project challenges students to jointheir social aspirations with the practical reality ofbuilding a business, resulting in projects whosesuccess depends on the synergies between thesedistinct elements.

In addition, in both the classroom and the field,role modeling integrative decision making can beused to help social entrepreneurs learn how toseek synergies. In the SEIPS course, for example,visiting social entrepreneurs explicitly discusshow they weave the mission into the fabric of theirenterprise, while simultaneously generating a sus-tainable revenue stream and staying afloat finan-cially. By hearing firsthand accounts of how thesesocial entrepreneurs make integrative decisions,students learn models for making these types ofdecisions themselves. In the field, leaders of socialenterprises can model integrative decisions for se-nior and middle managers. At DDD, the CEO oftenrefuses to accept decisions that privilege either theneeds of the social mission or the needs of thebusiness, challenging himself and his manage-ment team to find alternatives that accommodateboth. For example, DDD faces the imposed trade-off of whether to hire operators that are more dis-advantaged and thus advance their social missionor hire more skilled (and more productive) opera-tors and support their business goals. As notedabove, instead of accepting this trade-off, DDD'sCEO encouraged managers to find an integrativesolution: They ultimately decided to hire the mostskilled of the most disadvantaged. To do so, theyretained a third-party NGO to assess potential op-erators for their level of disadvantage and skilland then selected those among this group whowere high on both dimensions. Similarly, in theirdiscussions about growing and scaling the busi-ness, DDD's leaders consistently seek creativesolutions and possibilities to ensure that theyhonor their social mission while simultaneously

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maintaining their financial success. This decision-making practice not only helps managers under-stand paradoxical thinking, as noted above; it alsohelps them learn to make decisions that integratesocial and financial demands.

DISCUSSION

Social enterprises offer the promise of financiallysustainable organizations that respond to theworld's greatest problems. Yet if social enterprisesare to succeed, their leaders must be able to man-age the conflicting demands that emerge from boththe social and commercial focus. There is littledebate among scholars that these competing de-mands remain a challenge and a critical area forfuture research (Dacin et al., 2010). Although schol-ars have explored the skills of managing a socialmission as distinct from those of managing anentrepreneurial venture, little research has articu-lated the skills associated with attending to both.We have attempted to fill this gap. We do noteschew the value of distinct skills targeted at ad-vancing a social mission or ensuring commercialviability. Rather, we complement them by buildingtheory and offering pedagogical examples aboutdeveloping social entrepreneurs to effectively at-tend to competing demands that arise from thejuxtaposition of social missions and commercialviability. We therefore contribute to a growingbody of research on the unique features of socialentrepreneurs (i.e., Tracey & Phillips, 2007; Zahra,Gedajlovic, Neubaum, & Shulman, 2009) by high-lighting specific challenges associated with com-peting social and economic demands and linkingthese challenges to leadership skills and pedagog-ical tools.

[I]f social enterprises are to succeed,their leaders must be able to manage theconflicting demands that emerge fromboth the social and commercial focus.

Drawing on paradox theory, we argue that em-bedding a social mission and commercial meansin one organization is a double-edged sword. Ten-sions between social and commercial demandspose risks for social enterprises of either losingtheir focus on the social mission or their commer-cial viability, or becoming mired in intractableconflict. Yet these tensions can also foster creativ-ity, novelty, and long-term organizational sustain-ability. Taking advantage of the benefits of com-

peting demands, while avoiding the risks, dependsin part on the skills of the social entrepreneur.Based on paradox theory, we specifically identifythree meta-skills for attending to competing de-mands in social enterprises—acceptance, differen-tiation, and integration—and we discuss tools bywhich these skills may be developed in the class-room and field setting. Taken together, these chal-lenges, skills, and pedagogical tools comprise amodel of paradoxical leadership for social enter-prises, as depicted in Figure 1, in which leadersare engaging, rather than rejecting or becomingmired in underlying tensions.

Our paradoxical leadership model has impor-tant implications for social enterprise curricula,both in the classroom and in the field. This modelgoes beyond learning about how to develop andmeasure social missions, or how to efficiently andeffectively implement a business plan. Rather, itasks participants to explore their personal beliefsand mental models, potentially challenging someof their most well-established truths. Conventionalmental frameworks, particularly those in the Westthat draw inspiration from ancient Greece or theEnlightenment, are premised on the assumption ofa single truth and result in a formal, causal, andlinear logic (see Ford & Ford, 1994). According tothese frameworks, if A and B conflict, then onemust be right and one must be wrong. The keychallenge is to adjudicate between them. AsHampden-Turner (1981) notes, this dominantframework forms the basis of scientific inquiry,which emphasizes distinctions and polarization. Incontrast, our proposed model of leadership for so-cial entrepreneurs asks students to adopt paradox-ical thinking, an alternative mental model whichis premised on the simultaneous existence of mul-tiple truths, leading to a more circular, discursive,and interconnected logic. In a paradoxical model,if A and B conflict, then they can both be right, andthe key challenge is to find a way for them to existin relation to one another (Cameron & Quinn, 1988).

Shifting mental models is difficult work, and itreflects a growing trend in leadership curriculamore broadly to rely on transformational experi-ence rather than informational knowledge (i.e..Snook, 2008), and on deeper personal growth ratherthan skill development (Petriglieri, Wood, &Petriglieri, 2011). Adopting a paradoxical model ofleadership further challenges leaders to developmore sophisticated interpersonal skills and emo-tional intelligence (Clegg et al., 2002). As we ar-gued, meta-skills of acceptance, differentiation,and integration depend on creating community,learning from others, and managing conflict, andcurricula can effectively build opportunities for

2012 Smith, Besharov, Wessels, and Chertok 475

leaders to develop such emotional intelligence(see Boyatzis, Stubbs, & Taylor, 2002).

We have shown examples from the classroomand the field that help individuals rethink theirframeworks and thereby enable acceptance, differ-entiation, and integration. To do so, these settingseach adopt an overall structure that reflects thesemeta-skills, use leaders to model the meta-skills(either their own leaders or those borrowed fromother exemplars), and offer experiential opportuni-ties to engage and develop these skills. Takentogether, the pedagogical tools we have describeddo not focus on "teaching" social entrepreneurs perse, but rather on creating opportunities for suchleaders to grow, learn, and develop. As this ap-proach suggests, developing social entrepreneursinvolves adapting core aspects of course structuresand organizational processes, not just adding newcontent modules within existing structures andprocesses.

Beyond its contributions to pedagogy, our modelfurther has the potential to contribute to organiza-tional theory on social enterprise and social entre-preneurs. As Dacin and colleagues (2010, 2011) ar-gue, the field of social entrepreneurship may notbe a theoretical domain unto itself, rather it maybenefit from integrating insights from other theo-retical perspectives. By conceptualizing the workof social entrepreneurs through the lens of para-dox, we complement and extend insights fromother theoretical perspectives, particularly institu-tional logics and institutional work. Drawing fromparadox theory, our model proposes that socialenterprises embed inherent tensions, provides in-sight into the nature and challenges of these ten-sions, and offers explicit ideas about how leaderscan more or less effectively manage these ten-sions. Similar to our focus on tensions, an institu-tional logics perspective recognizes conflicting de-mands in hybrid organizations, such as socialenterprises, that embed multiple logics within oneorganization (Thornton & Ocasio, 2008). Consistentwith our focus on how leaders can manage ten-sions, research on institutional work has begun todescribe the role of individual actors in creating,maintaining, and destroying institutions (Law-rence & Suddaby, 2006), and specifically hasstarted to think about how to do such institutionalwork in the context of hybrid organizations such associal enterprises (Jarzabkowski, Matthiesen, &Van de Ven, 2009; Kraatz, 2009). A paradox perspec-tive complements these ideas while providing amuch more explicit focus on the management oftensions and on the specific cognitions and behav-iors that can promote beneficial or detrimental or-ganizational outcomes (Andriopoulos & Lewis,

2009; Smith & Lewis, 2011). By focusing on under-standing tensions and providing a way forwardtoward managing these tensions, paradox pro-vides a vital theoretical foundation for understand-ing skills for managing the competing demands ofsocial enterprises and tools by which these skillscan be developed.

In addition to contributing to research on so-cial entrepreneurship by drawing on paradoxtheory, we also contribute to research on para-dox by using social enterprises as a specificdomain in which to understand the managementof competing demands. Others have pointed tothe value of developing skills for embracing par-adox among leaders (Smith & Tushman, 2005)and have suggested strategies such as accep-tance, differentiation, and integration to do so(Andriopoulos & Lewis, 2009; Poole & Van de Ven,1989). We offer insights about the learning andeducational implications of these skills. Specifi-cally, our examples suggest that such learning ispossible, and they illustrate pedagogical tech-niques by which it might be accomplished. Un-derstanding these and other related pedagogicaltechniques is likely to become increasingly im-portant as a small but growing number of busi-ness schools start to grapple with the challengeof teaching paradoxical leadership skills (Mar-tin, 2007). Our model, which points to explicit andsalient competing demands, suggests that socialenterprises might be an especially fruitful set-ting in which to develop such skills.

Limitations and Future Research

We sought to build theory about skills for develop-ing social entrepreneurs and to illustrate associ-ated pedagogical tools in two award-winning set-tings. However, even as we drew from bothexisting theory and the field, our focus was not onconducting systematic, inductive research, nor onproviding a complete set of pedagogical tech-niques. Rather we hope the paradoxical model ofleadership we have articulated provokes future re-search to test and validate the efficacy of theseleadership skills and to develop a more compre-hensive typology of pedagogical tools.

We raise further questions about the setting fordeveloping social entrepreneurs. We chose todraw on examples from both the field and theclassroom in order to suggest the potential of bothsettings and illustrate more diverse pedagogicaltools. A field setting offers the benefits of havingclear and challenging outcomes (such as clientdemands in the case of DDD) that serve to directlymotivate learning. However, the field setting offers

476 Academy of Management Learning & Educafion September

less direct control over the content of learning.Learning occurs as individuals face and addressongoing problems and challenges in the work ofthe organization. A classroom setting offers moredirect control over the curriculum, but the conse-quences of doing good work are often inspired onlyby one's own motivation for learning and success.In fact, grades, which frequently pervert intendedlearning, often become the motivating outcome inclassroom settings (Kohn, 1993). Others have ex-plored the nature and benefits of these differentlearning settings more generally (Kolb, 1984) andhave identified techniques for blended styles—particularly introducing experiential learning intoa more formalized classroom setting (Kolb & Kolb,2005). However, for developing social entrepre-neurs in particular, we believe that it would befruitful to more specifically and systematically an-alyze the similarities and differences between thefield and classroom settings. How can differentapproaches effectively leverage the benefits ofeach setting? How can these approaches beblended to enable more learning?

Finally, future research can explore the gener-alizability of a paradoxical leadership model.Managing competing demands is not unique tosocial enterprises. Rather, social enterprises rep-resent one example of a broader category of hy-brid organizations that embody multiple, con-flicting values, identities, norms, routines, andstructures (Battilana & Dorado, 2010; Pache &Santos, 2010; Pratt & Foreman, 2000; Zilber, 2002).For example, health care organizations facepressures for both cost efficiency and patientcare (Reay & Hinings, 2009). Arts organizationsattend to both aesthetic and economic demands(Glynn, 2000). Universities seek to balance intel-lectual pursuits along with economic stability(Albert & Whetten, 1985). Future research caninvestigate the generalizability of our proposedleadership model to these other types of hybridorganizations. We suspect that the generalizabil-ity of our model may depend in part on the sa-lience of competing demands. In social enter-prises, competing demands that arise from thesimultaneous pursuit of social missions andcommercial viability are highly salient and re-main acute. In other hybrids, however, demandscan be synergistic and tensions can remain la-tent for extended periods of time (Greenwood,Raynard, Kodeih, Micelotta, & Lounsbury, 2011).Future research on hybrid organizations can ex-plore how our model applies under theseconditions.

CONCLUSION

In the early 20th century, Mary Parker FoUett rec-ognized that "[o]f greatest importance [for leader-ship] is the ability to grasp a total situation . . . [Theleader] must see a whole, not a mere kaleidoscopeof pieces. He must see the relation between all thedifferent factors of the situation" (Graham, 1996:168). Almost 100 years later, leaders still grapplewith this challenge. Social enterprises provide avital setting for resurrecting and applying FoUett'sprophetic words, a setting in which the total situ-ation combines a passion for the social missionwith a pragmatic focus on the business purpose.While leading such organizations is complex andchallenging, our goal here was to offer insight intothe nature of the skills necessary to do so and themeans by which leaders can develop these skills.Ultimately, we hope these ideas help spawn lead-ers who can more successfully solve some of theworld's greatest problems.

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Wendy K. Smith is an assistantprofessor of organizational be-havior at the Lerner College ofBusiness and Economics at theUniversity of Delaware. She re-ceived her PhD in organizationalbehavior from Harvard. Her re-search focuses on how leadersand organizations manage stra-tegic paradoxes.

Marya L. Besharov is an assis-tant professor of organizationalbehavior at the ILR School atCornell University. She re-ceived her PhD in organiza-tional behavior from Harvard.Her research focuses on hybridorganizations that combine

conflicting logics and identities, particularly their internaldynamics and the factors that enable them to sustainhybridity.

Anke K. Wessels is executive di-rector of the Center for Transfor-mative Action, an independentnonprofit organization support-ing projects seeking socialchange through inclusivity andproactivity. She received her PhDin geography from Pennsylvania

State. She teaches Social Entrepreneurs, Innovators, and Prob-lem Solvers, recognized as one of the top-10 most rigorous andinnovative syllabi by Ashoka.

Michael Chertok is cofounderand chief development officerof Digital Divide Data (DDD).He holds a BA in Russian Stud-ies from Yale University and anMBA from the Stanford Gradu-ate School of Business. Previ-ously, he served as programofficer in the Global Develop-ment Program of the Bill & Me-linda Gates Eoundation.

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