Adaptation or Expiration in Family Firms

Adaptation or Expiration in Family Firms

Organizational Flexibility in Emerging Economies

Andrés Hatum

Andrés Hatum explores determinants of organizational flexibility in this examination of four family-owned companies, two flexible and two less flexible, from the edible oil and pharmaceutical industries. By means of an innovative analysis – including longitudinal analysis, coding analysis, statistical analysis and the use of original display charts – he illustrates the determinants of flexibility and sheds light on the process of transformation and adaptation of family firms, an area that has not yet been the subject of extensive empirical inquiry.

Chapter 9: Concluding Remarks on the Transformation Process of the Firms Analysed

Andrés Hatum

Subjects: business and management, entrepreneurship, family business, organisational behaviour


9. Concluding remarks on the transformation process of the firms analysed It is beyond the scope of this book to discuss the different ways organizations can undertake organizational change. However, the fact that the four firms analysed underwent a process of transformation throughout the 1990s means that we need at least to understand the depth and scope of such a process. Moreover, writers in the field of organizational flexibility such as Volberda (1999) point out that adaptability can be achieved because flexible firms can transform when needed. For this reason, understanding how the firms in this study transformed also helps to shed light on their flexible capabilities (Volberda, 1996, 1999; Djelic and Ainamo, 1999). It is therefore important to establish the basic differences between the concepts writers have used to explain change in organizations. Greenwood and Hinings (1996) differentiate between two aspects of organizational change. First, they distinguish between radical (or what we call transformational) and convergent change. It is radical not convergent change in which we are interested. Second, they draw a distinction between revolutionary and evolutionary change. For Greenwood and Hinings (1996: 1024) radical change involves the transformation of the organization while convergent change ‘is fine tuning the existing orientation’. Under great pressure from the competitive environment that characterized Argentina in the 1990s, indigenous firms needed to respond rapidly and transform the company’s activities to be able to compete efficiently with MNCs (Toulán and Guillén, 1997; Guillén and Toulán, 1997;...

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