Managing tensions in a social enterprise: The complex balancing act to deliver a multi-faceted but coherent social mission

Abstract

Until recently, it was commonly assumed that social enterprises – by virtue of the ingenuity of their founders – were extra-ordinarily capable to simultaneously pursue social and financial goals. However, an emerging body of literature considers that social enterprises face tensions and trade-offs as they pursue their divergent goals. While extant research has offered insights into tensions that social enterprises face between social and financial goals, it is not clear whether this is the only trade-off social enterprises face or whether they also have to balance other, related tensions that stem from their social mission. In case tensions and trade-offs manifest themselves in other ways too, how do social enterprises manage the various different tensions and trade-offs while keeping a coherent social mission? The aim of this study is to examine a social enterprise's balancing act of addressing the various different tensions and trade-offs that arise when trying to deliver a multifaceted but coherent social mission. A qualitative research design was employed to examine tensions and trade-offs by focusing on the case of a German social enterprise from the organic food sector. The case study findings suggest that, initially, social enterprises face social-financial tensions. Yet, as they grow in size and scope, they also begin to experience tensions among their various social goals that we refer to as social mission design tensions. Regarding the management of tensions, we find that in contrast to the current tenor in the social enterprise literature, which espouses that redressing tensions is essentially an act of separation or integration of social and financial goals, we find that, at times, social enterprises accept and live with tensions instead of addressing them.