ORGANIZATIONAL DYNAMICS

Organizational Dynamics

Table of Contents

Introduction3

Introduction to Problem3

Statement of the Problem5

Purpose of the Study5

Rationale5

Organizational Dynamics6

Family Business Dynamics6

Organizational Culture7

Entrepreneurial Leadership8

Entrepreneurship8

Leadership9

Strategy11

Strategic Planning11

Family and Business as Strategy12

References14

Appendix15

Organizational Dynamics

Introduction

Small family business leadership influences organizations through displays of emotion, leadership style, effective communication, love, and trust. This study explores organizational dynamics of organizational culture, entrepreneurial leadership, and strategy in small family businesses employing fewer than 20 people. Three diverse small family businesses served as the sample. Elements observed during each company's daily operations included the interaction and inter connectivity of the organizational social system components of organizational culture, entrepreneurial leadership, strategy, external environmental influences, and family business continuum. This review suggested four emergent themes: First, parental founder love and trust of offspring working in the family business influenced daily operations and succession planning. Second, organizational cultural continuum of harmony or fear may be influenced by communication effectiveness, leader emotions (positive or negative), leadership style (authentic transformational, management-by-exception-passive), and follower emotional response (positive or negative). Third, the tenet of family first, in which family has priority over profits and business assets, support family needs. Fourth, spousal commitment may initially support the life partner's business dream and later wane, based on the spouse's willingness to discontinue or interrupt his or her own life.

Introduction to Problem

Small business drives the economic powerhouse of the United States (U.S.). In 2004, small firms accounted for more than half the jobs in the U.S. (U.S. Small Business Administration [SBA], 2007). Those classified as small businesses, firms employing fewer than 500 people accounted for more than 99% of U.S. businesses. Included in this number were 5.2 million employing firms with fewer than 20 employees. These small firms provided approximately 21 million jobs. In addition, approximately 19.5 million nonemploying companies and 10.4 million self-employed individuals existed within the United States. Nonemploying firms and self-employed endeavors employ both family and non family members, remunerating them with either unreported cash or other forms of compensation. The combined categories of small employer firms (fewer than 20 people), non-employer firms, and self-employed provide jobs for a staggering number of people and create a huge impact on this nation's economy. Auken, and Werbel, believed family influences the majority of these forms of small business. A commonly held assumption has said what works for big business will work for small business. Except, small family businesses are not small versions of large businesses, but rather they are unique and individual entities, subject to family pressures and influences. One presumption is that small family businesses may adhere to a philosophy in which family comes first, and monetary gain ranks second. Even though the majority of U.S. businesses are family businesses, historically, family firms have been understudied, neglected, and excluded from many business schools. Interest in family business research has recently increased because of the recognition that the majority of the world's firms encounter influences or pressures by family. Dyer (2004) described influence and pressure of family dynamics as affecting family business success and ...