Folding organizational paradoxes: Narrative practices for legitimation amid competing stakeholder demands

In paradoxical situations, organizational actors face various demands that are contradictory and interdependent at the same time. While the current literature focuses on how organizational actors respond to these paradoxical demands, it does so in a depersonalized manner with little attention to the stakeholders behind these demands. Therefore, it fails to explain how organizational actors legitimize their responses to paradox to those stakeholders who bring up the paradoxical demands. Using a narrative sensemaking approach, we study how social entrepreneurs legitimize their efforts to respond to paradoxical stakeholder demands for both delivering and measuring social impact. We find that social entrepreneurs legitimize their responses to this paradoxical situation through a narrative mechanism of folding. Through folding, narrators construct legitimizing accounts by narratively producing temporary alignments with some stakeholder interests, while opposing others. Through the recurring and consistently inconsistent use of the narrative practices of embodying and positioning, narrators produce a legitimizing account that overall portrays their responses to paradox as balanced and non-biased. As our main contribution, we offer a model of folding as a narrative, interest-based mechanism that explains how organizational actors legitimize their efforts to navigate paradoxical situations by portraying themselves as attending to paradoxical demands through a temporary and fluid shift between momentary alignments and oppositions of stakeholder interests.