Co-creating psychological ownership for change. Applying a relational practice perspective in family businesses.

Abstract

This paper takes up the call for a relational view of family businesses by introducing a relational practice perspective on organizational change in family firms. At present there is a scarcity of studies on family firm change. Family firms yet represent the majority of all businesses in countries around the world. We propose that it is mainly the lack of relational quality among the parties involved that causes failures of organizational change and learning, carrying with them enormous social and economic tolls. The value of a relational practice perspective is illustrated using an in-depth comparative case of a successful and unsuccessful organizational change process, both in a non-family business setting. We apply the learnings from these case studies to the research context of changing family businesses. Our main proposition is that if actors are able to engage in high quality or generative relational practices, characterized by dialogical interpersonal behavior and positive sense making drawn from a supporting relational context, they will experience joint psychological ownership and a willingness to invest in continuous improvement, innovation and learning. Applying this to the family firm, we propose that it is necessary to set up generative relational practices among family members, and between family and non-family actors. By doing so, fruitful quasi-family relationships, characterized by a high degree of joint psychological ownership, can be build. These relationships are seen as essential building blocks for family firms that want to excel in continuous renewal.