Planned strategic change in a family-owned firm: an ethnographic study

Abstract

Empirical research into how planned strategic change (PSC) occurs in family-owned businesses has received little academic attention. Since organizational change is at least as important for family businesses as their non-family counterparts, understanding whether widely accepted distinctive dynamics within family firms influence attempts at PSC represents a major gap in existing research. This thesis reports the results of an ethnographic, single company case study into Nirvana Ltd’s (NL) transformation program, designed to address this gap. This research contributes in several ways. First, it demonstrates that PSC in this large, owner-centric, family-owned business does follow a distinctive path. Second, it shows that PSC in NL is not adequately predicted, explained, or helped by conventional Organization Development (OD) change frameworks, such as Kotter’s 8-steps. Third, it identifies three paradoxical forces linked to “familiness” (leveraging faith versus persuasion, individual justice versus utilitarianism, and formality versus informality), as the primary enablers for and barriers to PSC in NL. Fourth, it discovers and defines the phenomenon of Faithful Adoption as a powerful force that can be employed by a talismanic owner to achieve rapid shifts in a business strategy. Fifth, it offers a new theoretical model, ‘Two-Step Change,’ as an explanation of how PSC has occurred in a large family-owned business. And finally, the ethnographic method and resulting dataset provide a unique and unprecedented richness and depth to this research subject.