Practicing identity in emergent firms: How practices shape founders’ organizational identity claims

Abstract

Establishing a new firm presents a variety of challenges to organizational founders. An important concern is the development of a set of clear and coherent organizational identity claims that can inform future strategic decision-making. While practices have been identified as important resources that individuals draw on during organizational identity change and formation, their role in initiating shifts in organizational identity claims has not been examined. In this longitudinal study of seven de novo organizations, we develop a process model showing how practices engaged in by founders when establishing their firms cue sensemaking about the organization’s identity by identifying identity voids, generating identity insights through interactions with outsiders, and identifying identity discrepancies through interactions with insiders. Founders interpret these sensemaking triggers as either opportunities or threats to their identity aspirations for their firms, leading to organizational identity work that generates new identity claims. We discuss implications of our model for scholars of organizational identity emergence and practice, as well as for founders of new organizations.

Sowing the seeds of failure: Organizational identity dynamics in new venture pivoting

“…To complement the coding of organizational members' claims about "who we are as an organization," we also paid attention to the practices revealed during participant observation as they contribute to determining employee roles and reinforcing organizational identity (Fiol, 2002;Oliver and Vough, 2020). As shown in Table 3, these also evolved over time, from the indiscriminate participation of all founders, managers, and employees in various tasks to a more pronounced hierarchical organization with major decisions made only by the C-level executives in line with the VC-approved term sheet.…”

“…Our data reveal that the crystallization of organizational members' roles might contribute to rigidification, subsequently inhibiting repeated pivoting in nascent markets. Second, following calls to examine how identities are constructed with others over time and across levels (Ashforth et al, 2011;Caza et al, 2018;Oliver and Vough, 2020), we uncover the micro-mechanism linking individual roles and organizational identity in new ventures (bottom of Fig. 2).…”

“…Our analysis highlights that not only founders and employees but also investors have a strong impact on the organizational identity dynamics of new ventures. This finding is unexpected for the organizational identity literature, which usually identifies stakeholders within the organization, particularly founders, as the main builders of organizational identity (Gioia et al, 2010;Oliver and Vough, 2020) especially in nascent markets (Stigliani and Elsbach, 2018), and has a limited focus on external stakeholders (but see Gioia et al, 2000, andTripsas, 2009). Work on the organizational identity of new ventures has mainly focused on how entrepreneurs craft an organizational identity that becomes useful to legitimate the new venture with various external audiences (Lounsbury and Glynn, 2001;Glynn, 2010, 2011).…”

The strategy–identity nexus: The relevance of their temporal interplay to climate change

“…Research should go beyond studies of focal organizations, as other types of organizational actors may address strategy and identity in different ways. Several contributions in the special issue on the strategy–identity nexus (Ravasi et al, 2020) discuss how strategy and identity connect in other types of organizations, such as emerging firms (Oliver and Vough, 2020) or social movements (Georgallis and Lee, 2020). In these situations, the strategy–identity nexus is more likely to be dominated by identity because moral credibility and stakeholder reactions to identity claims take center stage.…”

Organizational identity: components and construction

“…The results of the research presented in this paper go deeply into this field of oi and aim at understanding this matter as an ongoing construction process that involves both external and internal actors (Aracı, 2019;Oliver & Vough, 2019). This research places relevant considerations regarding the role of the organizations of origin (oos) from which individuals who currently work at the studied organization come, since they are constantly evaluating the legitimacy and the reputation of the current organization they work for in contrast to that from which they come.…”