Interpretive leadership skill in meaning‐making by nonprofit leaders

Abstract

Nonprofit leaders are instrumental in constructing and managing organizational reality. They thus need to possess skills to make meaning about various activities, interests, and organizational values, especially when mission and service contexts are in flux. Scholars recognize the sector‐distinct leadership role in social construction. Nevertheless, research has yet to articulate clearly how meaning‐making by nonprofit leaders develops leadership. This article fills this knowledge gap. We illuminate meaning‐making leadership in nonprofits. We identify interpretive leadership skill as an essential executive competency for configuring a shared reality of the nonprofit and guiding others to that reality. Interpretive leadership skill is composed of three meaning‐making capabilities: contextual astuteness, coordination capacity, and self‐reflective capacity. We theorize that interpretive leadership skill develops from the cognitive and identity development processes of the leader in social interactions. A constructive‐developmental approach to leadership underlies our theory building. Theoretical and practical utility of this conceptualization is discussed, as are directions for future research.

Institutional logics and the multiorganizational governance arrangements of humanitarian INGOs

“…However, critiques continue (Mitchell et al, 2020). Currently, there is notable attention being given to ideas of feminist leadership, organizational culture, and change among practitioners (https://5oaksconsulting.org/podcast/) and the importance of interpretive leadership skills and meaning‐making for nonprofit leaders (Lim et al, 2021). By presenting a multidimensional depiction of the competing ideal‐type institutional logics and drawing our attention to its association with different aspects of an INGO's governance arrangement, this can serve as a tool for leaders as they construct current interpretations of humanitarianism within their own organization and across the sector or contemplate changes in their own governance arrangements.…”

Understanding nonprofit leaders' perceptions of organizational efficiency

“…Although not explicitly mentioning Upper Echelons Theory, Lim et al (2021) discuss a key nonprofit leadership skill, interpretative leadership. This skill is the ability to perform meaning‐making in the environment that the nonprofit operates and to socially construct an organizational reality upon which staff, donors, and stakeholders can act.…”

Impacts of Systems Thinking on Mission When Environmental Nonprofit Organizations Encounter the Complex Systems Problem of Homelessness

“…Mission holds a sacred space in the nonprofit sector, with scholars differentiating between the mission-driven nature of nonprofit organizations vis-à-vis businesses or the state (Frumkin, 2002 ; Salamon, 2003 ), and Sanders ( 2015 ) calling the tension between mission and market “a key feature of what it means to be nonprofit-like,” (p.218). Nonprofit organizations are accountable for abiding by their mission of enhancing specific values while also attending to market-like conditions as they offer services (Lim et al, 2021 ). Nonprofit organizations are cautioned against mission drift and mission creep (Beaton, 2021 ; Grimes et al, 2019 ; Jones, 2007 ; Ma et al, 2017 ), but simultaneously understand they must adapt to their environments.…”

“…Terms like mission drift, mission creep, and mission displacement are used to describe an unwelcome or unintended movement from an organization’s original, core purpose (Berlan, 2018 ; Grimes et al, 2019 ). However, mission drift is difficult to define or even perceive because missions are socially constructed and individually understood (Berlan, 2018 ), making the desirability of mission change personal and subjective (Beaton, 2021 ), and internally conceptions of the mission and an organization’s activities are often conflicting or misaligned (Berlan, 2018 ; Lim et al, 2021 ).…”

“…As nonprofits more frequently encounter complex systems problems, they will face questions about whether shifts in practice are effective organizational adaptation or undesirable mission drift. When embedded in dynamic external environments, Lim et al ( 2021 ) theorize that effective nonprofit leaders can engage in meaning making deriving from ongoing interactions between the leader's social construction of the organization and their social embeddedness in the environment. Lim et al’s ( 2021 ) work suggests that effective leaders may be able to construct mission meaning for their organization out of the dynamic environments in which they are embedded.…”