Why social entrepreneurs are so susceptible to burnout

Wednesday, 20 February 2019 11:13 GMT

A man rests on a bench in a park in central Kiev, Ukraine July 5, 2018. REUTERS/Valentyn Ogirenko

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Doing good while making money is no easy task and can take its toll on entreprenuers' psychological wellbeing

Gabriella Cacciotti is Assistant Professor in entrepreneurship at the University of Warwick’s business school

Social entrepreneurs are often celebrated as contemporary heroes who create business to help people and the planet – an activity considered important for fostering societal wellbeing. But can these entrepreneurs do this without compromising their own wellbeing?

With too much focus on their broader mission of changing the world, we lose sight of the daily  struggles these entrepreneurs go through.

Social entrepreneur and Nobel Prize winner, Muhammad Yunus said there are two kinds of businesses in the world. “One is a business which makes money, and the other solves the problems of the world.” Entrepreneurs need to decide “what kind of life they would like to choose,” he said.  

But can social entrepreneurs really create businesses that solve the problems of the world without making money? Herein lies the tension.  

Creating a business that contributes to a more sustainable world while simultaneously ensuring that the business itself is sustainable is not an easy task. Social entrepreneurs’ desire to help others can be misaligned with the goal of doing this through a business that is also required to generate profit or value for the shareholders. 

Such goals as ‘‘doing good” and ‘‘making money” may be incompatible, as making progress towards one of these goals requires actions and decisions that can undermine progress toward the other. This is known as goal conflict.

When trying to solve this tension, entrepreneurs can engage in actions that diverge from the stated mission and core objectives of their business. This risk is called mission drift.

The simultaneous pursuit of social mission and commercial viability can also involve resource conflict, when social entrepreneurs are spread thinly, having to engage in too many activities, which makes it difficult to regulate personal resources such as time and money.

Research shows the pursuit of personal goals can lead to a psychologically fulfilling life by providing meaning and structure to one’s identity. However, juggling multiple goals at the same time can lead to lower psychological wellbeing and increased psychological distress because of a lack of progress made towards them.

So what can social entrepreneurs do to protect themselves from burnout?

The first step is to acknowledge any signal of psychological distress they feel and change their goals accordingly.

A recent study involving 186 entrepreneurs, conducted by Ewald Kibler, Joakim Wincent, Teemu Kautonen, Martin Obschonka and myself, published in the Journal of Business Venturing last year, demonstrates that perception of autonomy can reduce the stress associated with managing conflicting goals and increase the level of life satisfaction.

By having more control on their daily work tasks, social entrepreneurs can better identify what to focus their time and energy on.

They may also need to rethink their business strategy. Notwithstanding the importance of creating a business that does good while making money, they should come up with a more coherent plan of actions that aims to create and distribute economic as well as social value.

In so doing, social entrepreneurs will be able to carry out businesses that can potentially improve societal wellbeing without compromising their own.