Strategic Decision-Making and Performance in Social Enterprises: Process Dimensions and the Influence of Entrepreneurs’ Proactive Personality

Abstract

AbstractDifferent organizational perspectives surrounding social enterprises (SEs) have burgeoned over the past few years. However, integrating financial sustainability with social value remains a “black box” with respect to entrepreneurial strategic decision-making (SDM). Drawing from decision theories and the proactivity perspective of personality-based SDM literature, we investigate the impact of synoptic (rationalistic) and incremental (adaptive) process models, and moderate these approaches with the entrepreneur’s proactive personality traits on SEs’ financial and social performance. Our results show that when a rational and intuitive SDM develops in conjunction, financial performance improves. In contrast, a departure from rationality in favor of incremental decision-making processes advances only the social performance of SEs. A proactive entrepreneurial personality positively moderates strategic cognitions in improving SEs’ both financial and social objectives. On the other hand, when proactivity moderates rationality, the financial performance of SEs declines.