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A Theory of Socio-Business Diffusion

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A Theory of Socio-Business Diffusion A THEORY OF SOCIO-BUSINESS DIFFUSION: UNDERSTANDING THE INFLUENCE OF MONDRAGÓN CORPORACIÓN COOPERATIVA AS A POSITIVE FORCE FOR CHANGE AT THE INTERSECTION OF BUSINESS AND SOCIETY by BONNIE RICHLEY Submitted in partial fulfillment of the requirements for the degree of Doctor of Philosophy Dissertation Advisor: David L. Cooperrider, Ph.D. Department of Organizational Behavior Weatherhead School of Management CASE WESTERN RESERVE UNIVERSITY August, 2009 CASE WESTERN RESERVE UNIVERSITY SCHOOL OF GRADUATE STUDIES We hereby approve the dissertation of Bonnie A. Richley_________________ candidate for the ____Ph.D. ___________________ degree*. (signed)_______________DAVID COOPERRIDER_________ (chair of the committee) __________________DAVID KOLB________________ _______ ___RONALD FRY_ ___________ _______ _PETER WHITEHOUSE__ ________ (date) June 01, 2009_____________ *We also certify that written approval has been obtained for any proprietary material contained therein. Copyright © 2009 by Bonnie A. Richley All rights reserved 1 To God, my Father, He who is everything. I live each day with the hope of bringing You joy, serving You with all of my being, bending to Your will, moving toward the good purpose on this path which You have made for me. 2 Prayer for systemic change We praise and thank you, O God, Creator of the Universe. You have made all things good and have given us the earth to cultivate. Grant that we may always use created things gratefully, and share them generously with those in need. Give us creativity in helping the poor meet their basic human needs. Open our minds and hearts so that we might stand at their side and assist them to change whatever unjust structures keep them poor. Enable us to be brothers and sisters to them, friends who walk with them in their struggle for fundamental human rights. We ask this through Christ our Lord. AMEN “The whole field of international economic development has changed since the 1960s and '70s. The new idea is to lift people out of poverty by giving them tools to improve their incomes. Their lives are changed not by handout aid, but through design.” ~Andrew Blauvelt, Curator, The Walker Design Center, show entitled, “Design for the Other 90%,” Minneapolis. May 24, 2008 It is difficult to get a man to understand something when his job depends on not understanding it. ~Upton Sinclair 3 Table of Contents LIST OF TABLES…………………………………………………………… 7 LIST OF FIGURES………………………………………………………….. 8 LIST OF ILLUSTRATIONS………………………………………………... 9 PREFACE…………………………………………………………………….. 10 ACKNOWLEDGEMENTS………………………………………………….. 17 ABSTRACT…………………………………………………………………… 22 PART ONE: INTRODUCING THE RESEARCH STUDY CHAPTER 1…………………………………………………………………… 24 INTRODUCTION Research Concern and Purpose Why is this Important? Alignment with the emergent need to generate both social and business good. Alignment with new forms of organizing that restores power and hope to individuals and communities. Alignment with the mission of scholarship. Contributions A Map of the Dissertation Summary CHAPTER 2……………………………………………………………….…… 44 CONCEPTUAL FRAMEWORK AND GUIDING LITERATURE Guiding Philosophy: Appreciative Inquiry and Positive Organizational Change Innovation and Diffusion A Model that Enjoins Business and Social Objectives Rethinking Cooperatives Organizational Culture Summary 4 CHAPTER 3…………………………………………………………………… 63 METHOD AND ANALYTICAL APPROACH Research Purpose and Questions Methodology Qualitative Research. Grounded Theory and Case Studies. Cases-within-a-Case Study. Sample Data Collection Primary Case Site – MCC. Nine Mini-cases. Analytical Approach Summary PART TWO: SOCIO-BUSINESS INNOVATIONS CHAPTER 4…………………………………………………………………… 92 MONDRAGÓN: AN EXEMPLARY SOCIO-BUSINESS INNOVATION A Personal Reflection A Visionary Realist’s Qualifier A Socio-business Innovation: Identifying Characteristics The Birth of MCC: From and End Comes a Beginning Mondragón Corporación Cooperativa Today Summary CHAPTER 5…………………………………………………………………… 126 PARTICIPANTS PROFILES Case 1 The Person The Context The Impact Case 2 The Person The Context The Impact Case 3 The Person The Context The Impact Case 4 The Person The Context The Impact Case 5 The Person 5 The Context The Impact Case 5 The Person The Context The Impact Case 7 The Person The Context The Impact Case 8 The Person The Context The Impact Case 9 The Person The Context The Impact Summary PART THREE: ANALYSIS AND MODEL DEVELOPMENT CHAPTER 6…………………………………………………………………… 187 FINDINGS AND A THEORY OF SOCIO-BUSINESS DIFFUSION Building Blocks of Theory The Diffusion of an SBI Phase I: Precursors to SBI Extrinsic Influences Intrinsic Motivators Phase II: Discovering and Experiencing an Ideal SBI Attractors Connecting Knowledge Transfer Phase III: Actualizing an SBI Contextual Relevancy Leveraging Capacity Grounding SBI A Model of the Diffusion Process of an SBI Data Structure A Theory of Socio-Business Diffusion Summary 6 CHAPTER 7…………………………………………………………………… 226 DISCUSSION, IMPLICATIONS AND CONCLUSION A Third Way Review of Research Questions Diffusion of an SBI Phase I – Precursors to SBI Phase II – Discovering and Experiencing an SBI Phase III – Actualizing an SBI Diffusion of an SBI: Generative Capacity Evolution of innovation Differences in diffusion Generative Organizing: Propositions Implications Limitations Summary APPENDICES………………………………………………………………… 254 Appendix A – IRB Application and Consent Form Appendix B – Interview Protocol BIBLIOGRAPHY…………………………………………………………….. 260 7 LIST OF TABLES Chapter Page Table Title 2 46 1 The Ten Appreciative Inquiry Principles. 2 56 2 Comparison of a Traditional Organization to that of a Cooperative. 3 70 3 Grounded Theory Guideposts 3 80 4 2002, 2003, 2004, Visitors to MCC listed by Point of Origin 3 81 5 9/16-12/3, 2004 Schedule of Visitors to Otalora 3 82 6 2002, 2003, 2004 Groups/Hours of Education Time Recorded at Otalora 3 82 7 Details of Mondragón Internal Participant Information 3 84 8 Details of External Participant Information 4 105 9 MCC Annual Report to 31-12-2006 4 113 10 Ten Basic Principles of Mondragón 4 121 11 The Seven Characteristics of an SBI, Labels, and Support from Historical and Interview Data 6 213 12 Details of Codes and Themes 7 243 13 Differences between Pure Innovation and Technical Innovation 7 244 14 Differences between Social Innovation and Socio- business Innovation 8 LIST OF FIGURES Chapter Page Figure Title 4 98 1 MCC Geographical Location. 4 105 2 MCC Worldwide (2006) 4 107 3 Distribution of Employment Generated by MCC to 12/31/2006 4 107 4 Distribution of Employment in Spain, according to Autonomous Region to 12/31/2006 4 108 5 Evolution of Employment to 21/31/2006 4 108 6 Distribution of Employment According to Activity 4 112 7 MCC Business Structure 4 112 8 MCC Corporate Mission and Values 4 116 9 MCC’s Organizational Structure 2006 4 119 10 MCC’s Management Model 2005 6 188 11 Phases of the Diffusion Process of an SBI 6 190 12 Data Structure 6 210 13 The Diffusion Process of a Socio-business Innovation 6 211 14 Adaptation of SBI and Levels of Impact 7 245 15a Diffusion of Innovation (Rogers, 1962) 7 245 15b Diffusion of an SBI 9 LIST OF ILLUSTRATIONS Chapter Page Illustration Title 4 98 1 Fr. Jose Maria Arizmendiarrieta (1915-1976) 4 99 2 A City of Bomb Shattered Buildings. 4 99 3 1300 Bodies Recovered after Barcelona Raids. 4 100 4 Trek of Men, Women and Children 4 101 5 ESKOLA POLITEKNIKOA (The Polytechnical School) 4 102 6 MCC 1956-1970 – The Beginning of ULGOR now Fagor Cooperative. 4 104 7 MCC Today and Corporate Logo 5 163 8 Service Area of ACEnet 10 PREFACE At the heart of my desire to obtain my Ph.D. was to equip myself with the skills and knowledge to teach, research, lead and influence positive change for people and organizations. Like everyone, my goals and ideals have no doubt been shaped by my family, my culture and key transition points throughout my life. I have been raised as a member of the American working-class brought up to believe in the good of democracy and a reward system founded in meritocracy. These are values and beliefs that shape my worldview. I am grateful for my upbringing; it has paradoxically provided me with both privilege and the ability to be more sensitive to those who are marginalized by situations, systems, and elitism. In my interactions with people from other cultures I have noticed that many consider the terms “American” and “individualism” to be synonymous; this type of generalization assumes (and thereby confuses) a value for individual rights with a way of life. As an American I value without question the rights of the individual but this belief does not mean that I think that people should exist as self-serving and separate entities. Embedded in this position is the struggle to balance the needs and rights of the individual with those of the collective. Today, as class distinctions, poverty, and joblessness continue to rise, our attention turns to an increasing sense of injustice at a global level. At this juncture in time we need new ways to help us to foster democratic 11 systems to obviate the competing and ever growing drive for unbounded economic growth for a privileged few. I have spent the greater part of my life trying to figure out how to contribute to this balancing act to include international healthcare, a brief stay in law school where I intended to focus on advocacy work for women and children, community outreach and sundry other personal and professional venues. While I had taken many routes over the years in pursuit of my goal I continued to be dissatisfied. I felt bound by the bureaucracy and hierarchy inherent in the large systems that I wanted to change. I realized that I wanted to effect change but lacked the “how to.” By chance I met a person during a layover at an airport in Washington, D.C. During the three-hour hiatus we chatted about many things including my experience as a then newly initiated law school student and my long-standing personal aspirations. I remember him listening intently, with focus, and patience.
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