The influence of transformational leadership in business model innovation within social enterprises

Abstract

The complexity of a rapidly changing environment compels organisations, including social enterprises, to continuously change their business models to respond competitively and effectively to evolving market demands. Innovative business models are valuable for social enterprises as they navigate the dual mission of achieving social impact and economic success, often in resource-constrained environments. The study explored the influence of transformational leadership on business model innovation within social enterprises. Through qualitative interviews with South African leaders of social enterprises, transformational leadership and its impact were researched to determine the extent of its contribution to enhancing employee engagement and motivation, creating an environment conducive to change, creativity and problem-solving, and enabling social impact and sustainability. The study validated idealised influence, inspirational motivation, individualised consideration and intellectual stimulation as key components of transformational leadership. It also developed a new model illustrating how transformational leadership can drive change, facilitate social impact and adapt to complexities faced, showing how transformational leadership can be a catalyst for sustainable business model innovation within the context of social enterprises.