The relationship of organizational culture and change to external leadership : A qualitative study of Swedish family businesses

Abstract: The purpose of this thesis is to develop an understanding of the change in values, seen through company culture, experienced by a family business when the leadership transfers from the founding family to an external CEO. In a family business, strongly rooted family values are reflected by the very nature of the organization they have created. If a family member is the successor of a healthy and grow-ing family business, the successor should by default share most of the incumbent‟s personal values and as such be able to keep the organization on its current track. However, it is not possible to completely evade the possibility of mis-matching values, and this issue lingers and is even more pressing when the company is faced with an external leader. By conducting a qualitative multiple case study with semi-structured interviews on two Swedish family businesses, and then performing a case analysis through pattern matching, we attempted to answer if the family business‟ values, in the sense of organizational culture, change in relation to the change to external leadership, seen from an employees‟ perspec-tive. We also sought to answer why the organizational culture changes or not in relation to the change to external leadership, and what role the personal values of the leader play. From our analysis, we could conclude that the organizational values do change, even if only slightly, and that the reason for this is the fact that the external CEOs does not have iden-tical personal values to the founding families/owner. The pattern was found that recruiting an external leader enhances the value of efficiency in a company, and that the leader‟s per-sonal values reduces the resistance to change, influence the organizational culture and sub-sequently makes it change, given that the leader is an accepted part of the company‟s power structure. It would be beneficial to, in future research, connect our study one step further back in the causality chain and look at how previous experiences of the external CEO in-fluences the organizational culture.