Membership heterogeneity and the cooperative`s choice of strategy : the case of Sweden’s smallest dairy cooperative

Abstract: Because of structural changes in the agri-food sector, the degree of heterogeneity within cooperative memberships is increasing. Heterogeneity concerns differences within a group of people, for example, as concerns age, educational level and production volume within a cooperative membership. This study analyzes heterogeneity in different respects within cooperative memberships. While many researchers have previously written theoretically based studies about the importance of membership heterogeneity, there is no empirical study about the importance of different dimensions of heterogeneity. The present study empirically investigates to which extent different dimensions of heterogeneity affect a cooperative’s choice of strategies. The aim of this study is to explore how heterogeneity in the members of a cooperative affects the collective strategic decisions. An empirical study was conducted in Sweden's smallest dairy cooperative, Gäsene Mejeri. Except for literature about heterogeneity in cooperative memberships, the theoretical basis of this study is behavioural theory. The chosen theory was The Theory of Planned Behaviour, which explains how external factors affect an individual's attitudes toward their own behaviour, i.e., how the members develop their attitudes to the strategic decisions, made by the cooperative. A question guide was developed on the basis of this theory, while the respondents were also given ample opportunities to speak freely. This study can be regarded as a case study of Gäsene Mejeri. Data were collected through 21 semi-structured interviews with members of Gäsene Mejeri. Thus, almost the entire membership was interviewed. The respondents were asked about their position on two strategic decisions, namely the introduction of differentiated milk prices and the contractual agreement to deliver private-labelled cheese to a large supermarket chain. The study indicates that the membership of Gäsene Mejeri is characterized by heterogeneities in different aspects. The members differ considerably as concerns age, farm size and investments. These dimensions have an impact on the members expressed support or opposition of the collective strategic decisions. However, these differences have only a minor influence on the actual strategic decisions, because the members at large have high level of trust in the board of directors. The members think that the board, just as well as they themselves, prioritize the interests of the cooperative. All the members are dependent upon each other, whereby there is little room for divergent opinions, no matter if the members are different in socioeconomic terms.