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2021-09-10 - Colloque/Présentation - communication orale - Anglais - 35 page(s)

Godfroid Cécile , Otiti Naome, "Employee Tenure and Performance: The Case of a Social Enterprise" in VIII Congreso Internacional de Investigacion en Economia Social de Ciriec , San José, Costa Rica, 2021

  • Codes CREF : Economie des PVD (DI4375), Management (DI4360)
  • Unités de recherche UMONS : Economie et gestion de l'entreprise (W742)
  • Instituts UMONS : Institut de Recherche en Développement Humain et des Organisations (HumanOrg)
  • Centres UMONS : Inclusion sociale (CERIS), Microfinance (CERMI)

Abstract(s) :

(Anglais) Social enterprises have gained in popularity since their appearance in the 1980s and 1990s and are now considered as an alternative to charity organizations and government intervention in social, economic, and environmental issues (Yunus, 2017). They are hybrid organizations since they pursue a social mission in an entrepreneurial way (Battilana & Dorado, 2010; Battilana & Lee, 2014; Peredo & McLean, 2006) and endorse both market and social welfare logics (Battilana & Dorado, 2010; Pache & Santos, 2013; Wry & York, 2017). To ensure their sustainability, they should perform well on their social and financial objectives concurrently. One cannot succeed without the other. Indeed, to be able to attain a larger long-term outreach, social enterprises should be financially sustainable. Nevertheless, financial performance should remain a means to achieve their social mission, and not become an end. Balancing both financial and social performances may not be easy to achieve (Civera et al., 2020) and unfortunately, nowadays, there are many examples of social enterprises that face tradeoff tensions between both types of performance and opt to favor their financial mission over their social one as they mature, a trend known as “mission drift” (Tykkyläinen & Ritala, 2020). Since social enterprises are “labor-intensive rather than capital-intensive organizations” (Nakagawa & Laratta, 2013: 2), they must rely on their employees to reach such a balance. Therefore, the employees of social enterprises are expected to be the guardians of the hybridity of the organization they work for. However, employees of social enterprises face some tensions on their own. They may encounter difficulties in fully identifying with both prongs of the organizational mission (Battilana & Dorado, 2010) and, just like the organization they work for, they may face tradeoff tensions between reaching social and financial targets (Doherty, Haugh, & Lyon, 2014). Missions and goals are thus a source of conflict for employees in such organizations leading to what is referred to as “performing tensions” (Civera et al., 2020; Smith, Gonin, & Besharov, 2013). Furthermore, as mentioned by Zychlinski, Lev, and Kagan (2020), social workers have to fulfill their primary obligation of increasing clients’ wellbeing while at the same time being limited in their action by some organizational financial constraints (financial self-sufficiency in the case of social enterprises). They explain that this “places social workers in an ethical dilemma, where they must choose between two or more ‘correct’ courses of action” (Zychlinski et al., 2020, p.2). Beisland, D’Espallier and Mersland (2019) even observe mission drift at the employee level that they call “personal mission drift”: employees’ prosocial motivation decreases as the length of their employment at the organization increases. Thus, mission drift may be avoided if employees of social enterprises manage to strike the right balance between social and financial performances. Our aim in this study is to deepen our understanding of the tradeoff faced by social enterprises by examining it at the employee level. More precisely, our paper considers the effect of employee tenure on both social and financial performances but also on a combined measure of both types of performance. To examine the relationship between employee tenure and both social and financial performances measured at the individual level, we used a sample of 2,252 employee-quarter observations taken from 214 loan officers at a specialized microfinance bank in Ecuador. Our results from random-effects models suggest a positive linear relationship between tenure and social performance and a S-shape relationship between tenure and financial performance, with tenure first decreasing financial performance, then increasing it and finally decreasing it. Generally, the results on social and financial performance show that tenure influences the type of performance that employees of social enterprises will favor and that employees with lower tenure are the ones who are the most inclined to experience tradeoff tensions between both types of performance and prefer favoring social performance. Such findings further emphasise the need for the development of theories specific to social enterprises. Finally, in an attempt to determine how employee tenure affects the achievement of good personal hybrid performance (high social–high financial performances), we include a combined social–financial performance variable. Results from this suggest an S-curve relationship, where the likelihood of achieving good hybrid performance initially declines, then increases, and finally declines again, showing that employees with moderate tenure are the least affected by tradeoff tensions.