Keeping Good Companies • • A NORWEGIAN ARTISAN ELITE MAKING A LIVELIHOOD Keith Postler The London School of Economics and Political Science PhD (Management) London, 2010 UMI Number: U6157B2 All rights reserved INFORMATION TO ALL USERS The quality of this reproduction is dependent upon the quality of the copy submitted. In the unlikely event that the author did not send a complete manuscript and there are missing pages, these will be noted. Also, if material had to be removed, a note will indicate the deletion. Dissertation Publishing UMI U615732 Published by ProQuest LLC 2014. Copyright in the Dissertation held by the Author. Microform Edition © ProQuest LLC. All rights reserved. This work is protected against unauthorized copying under Title 17, United States Code. ProQuest LLC 789 East Eisenhower Parkway P.O. Box 1346 Ann Arbor, Ml 48106-1346 TUt^C5 f British Library of Political and Economic Science Declaration The work presented in this thesis is my own. Keith Postler, 23rd September 2010 Copyright Notice The copyright of this thesis rests with the author and no quotation from it or information derived from it may be published without the author’s prior written consent. Abstract The thesis examines the establishment of an original business model and the institutions which enable and perpetuate it. An alliance of elite Norwegian artisan builders and interior designers develops the model in catering to a market of bespoke manufacture for Norway’s elite. The thesis argues that the originality of the model derives from the artisans’ creative use and adaptation of institutions in the Norwegian Welfare State and its business and local environment, forming a distinctive entrepreneurial lifestyle that results in a thriving network of companies and in the achievement of‘the good life’. Drawing upon literature that posits the intertwining of social and economic activity, the thesis identifies and analyses the part played by artisans’ families, associates, friends and firms engaged in making a livelihood. A dual economy characterises the functioning of these units: capitalist market exchange and closed market exchange. Two social codes govern closed exchange, one for the alliance, the other for its clients, with whom the artisans develop the institution of ‘friends’ and ‘family’ central to how the artisan network creates its wealth and well-being. The social codes regulate the network’s entrepreneurial expansion and its limits by economies of scope rather than scale. This business model of keeping good companies departs from capitalist models of growth and the model of homo oeconomicus. Rather, lifestyle, ‘the good life’, structures the network’s making a livelihood. This new finding contributes to an understanding of, and impetus for research into, accounting, business models, business strategy, entrepreneurship, innovation, international business, marketing, organisation, creating wealth and well­ being, craftsmanship, and interdisciplinary research method. The visual and manual orientation of the craft workers warranted several methods of research: statistical measures, silent and semi-participant observation, cognitive linguistic analysis, and what one might call ‘research conversation’. 3 Acknowledgements I owe my greatest and irredeemable debt to Professor Martha Mundy, Department of Anthropology at LSE, for overall supervision of this thesis far beyond the call of duty. The Department of Social Anthropology at my alma mater, the University of Oslo, contributed to my thinking during fieldwork for this thesis. I consulted Professor Fredrik Barth six times during my initial fieldwork. Professor Aud Talle granted me permission to participate in her doctoral seminar on Readings in Contemporary Ethnographic Writing. Visiting Professor Juliet Corbin’s course in Grounded Theory put to the test interpretation of my data. The Norwegian School of Management welcomed me back to participate in their doctoral seminars Qualitative Methods: Data and Analysis (under Professor Svein Andersen) and Innovation Management and Entrepreneurship (under Professor Tore Bakken). LSE provided a grant throughout my research and appointed me to teach and examine under- and postgraduates in four of its departments: Accounting and Finance, Management, The Methodology Institute, and Statistics. These opportunities supported my cross-disciplinary orientation to research and teaching. Contact with coordinators for these courses—Professor Alnoor Bhimani (Accounting), Dr Jouni Kuha and Professor Colm O'Muircheartaigh (Statistics), Professor Peter Abell and Dr Raphael Gomez (Management)— strengthened my cross-disciplinary direction. I would like to thank the anonymous artisans for making this research possible. Attila Marton, doctoral candidate in LSE’s Information Systems and Innovation Group of the Department of Management, contributed timely expertise as an IT consultant. Rodney Mantle, MA (Oxon), a native-born Londoner, afforded companionship on country walks. Brief Contents LIST OF TABLES........................................................................................................................12 LIST OF ABBREVIATIONS......................................................................................................13 1 ‘THE GOOD LIFE’: THE LIFESTYLE OF A JOURNEY ............................................15 Part I Norway 2 THE NORWEGIAN WELFARE STATE.......................................................................... 42 3 NORWEGIAN BUSINESS OWNERSHIP..........................................................................77 Part II Families and Firms 4 THE ARTISAN FAMILIES................................................................................................... 96 5 ASSOCIATES OF THE NETWORK................................................................................ 130 6 FRIENDS OF THE NETWORK.........................................................................................159 7 FIRMS OF THE NETWORK AND THEIR EVOLUTION..........................................173 Part III Lifestyle: Making a Livelihood 8 THE DUAL ECONOMY OF THE NETWORK..............................................................208 9 POWER, SOCIAL CODE, AND ENTREPRENEURSHIP.......................................... 240 10 NETWORK LIFESTYLE .................................................................................................. 276 11 THE NETWORK JOURNEY ............................................................................................312 BIBLIOGRAPHY.......................................................................................................................318 5 Detailed Contents LIST OF TABLES........................................................................................................................12 LIST OF ABBREVIATIONS......................................................................................................13 1 ‘THE GOOD LIFE’: THE LIFESTYLE OF A JOURNEY ............................................15 A N ote o n Co n ceptu a l Fr a m e w o r k s ........................................................................................... 27 Str u c t u r e and Re se a c h Q u e s t io n s ..............................................................................................28 Str u c t u r e o f th e T h e s is.....................................................................................................................28 Ethnographic Chapters .........................................................................................................29 Analytical Chapters .............................................................................................................. 30 M e t h o d s ..................................................................................................................................................... 31 Raison d'etre of Methods......................................................................................................31 Eliciting, Recording and Presenting Data ..........................................................................34 Methods and Results............................................................................................................. 36 Verification ............................................................................................................................38 Part I Norway 2 THE NORWEGIAN WELFARE STATE...........................................................................42 P a r t I N o r w a y a s a W elfa r e St a t e : In d ic a t o r s of N a t io n a l Su c c e s s ..................................42 T h e M ea su r e o f N o r w a y ................................................................................................................... 48 O ilin g th e N o r w egian W e lfa r e St a t e ....................................................................................... 48 P a r t II T h e N o r w eg ia n Bu sin ess E n v ir o n m en t in th e W elfa r e St a t e ......................................52 E ase o f D o in g B u sin ess in th e W elfa r e Sta te o f N o r w a y .............................................. 54 B u sin ess C ompetitiveness in th e N o r w egian W elfa r e St a t e ........................................ 55 N o r w a y Sco res on Competitiveness ........................................................................................... 57 P a r t III G r ea ter O slo in the W elfa r e St a t e ..........................................................................................