Bachelor’s Thesis
How Corporate Venturing Influences
the Flexing of Organizational Identities
Stijn Wijdekop
BSc in Economics and Business University of Amsterdam Supervisor: Taghi Zadeh
Acknowledgements
The past three months have been an exciting journey, dedicated to the last step in finishing my bachelor ‘Economics and Business’ at the University of Amsterdam: writing this thesis. I would like to express my gratitude to those who helped me during this period.
First, I would like to thank Allan de Ventura Silva, Martijn Swijghuisen Reigersberg, Menno van Leeuwen, and Reginald de Wasseige for participating in this research. During these hectic times, brought to us by COVID-19, I can imagine work being more stressful and time-consuming than it would normally be. Your participation is greatly appreciated.
Secondly, I would like to thank my supervisor from the UvA, Taghi Zadeh, for his guidance throughout the research project. His feedback has helped me tremendously, especially during times where I felt lost.
I hope that you will enjoy reading the current research. If you have any questions or comments, please do not hesitate to contact me.
Abstract
As a result of the decreasing information costs and increasing community engagement, companies are constantly faced with the pressure to innovate. One way of innovating is through corporate venturing activities. This study aimed to explore the influence of corporate venture activities on the flexing of the organizational identity. This research provides new insights on how organizations can flex their organizational identity. To research this relationship, semi-structured interviews were held with four employees of ABN Amro. Through in-depth analysis of the interviews, we develop a grounded model that explains the influence of corporate venturing on the flexing of a rigid organizational identity. We find that people are afraid of change resulting in this rigidity in their mindset, but that this perspective can be changed by involving these employees more in the innovation process and exposing them to positive examples.
Table of Content:
Chapter 1: Introduction 4
Chapter 2: Theoretical Framework 6
§2.1 Introduction 6
§2.2 Context to the Research 6
§2.3 Innovation and Corporate Venture Activities 6
§2.4 Organizational Identity 8
§2.5 Organizational identity and (its Influence on the Perception of) the External
Environment and Innovation 10
Chapter 3: Methodology 13 §3.1 Introduction 13 §3.2 Type of Research 13 §3.3 Sample Composition 13 §3.4 Data Collection 15 §3.5 Data Analysis 16 §3.6 Quality Procedures 17 Chapter 4: Findings 18 §4.1 Introduction 18
§4.2 Change in Organizational Identity 19
§4.2.1 Rigid Organizational Identity (Past) 19
§4.2.2 Flexible Organizational Identity (Present/Future) 19
§4.2 Causes of Rigidity 20
§4.3 Causing the Transition 21
§4.3.1 External Changes 22
§4.3.2 Strategic Refocus 22
§4.4 Results of the New Strategy & Purpose 23
§4.4.1 Increase in Explorative Innovation and Collaborating (through CV) 24 §4.4.2 Communicating the New Strategy and Involving the Employees 25 §4.5 Changing Mindsets through Involving Employees from throughout Entire
Organization 27
Chapter 5: Discussion 30
§5.1 Introduction 30
§5.2 Quality Measures 30
§5.3 Limitations & Implications for Further Research 31
Chapter 6: Conclusion 32
Chapter 1: Introduction
Between 2013 and 2018, the global capital expenditures of corporate venture activities have increased by more than 400%, growing from 10.6 billion USD to 53 billion USD. During that period of time, the amount of deals with external startups through corporate venturing increased by more than 166% (Corporate Venturing Report, 2019). Financial technology, also known as fintech, is Europe’s largest venture capital investment category. Fintech receives almost 20% of all venture capital in Europe (The State of European Fintech Report, 2019). In a speech in 2015, Anthony Jenkins, former CEO of Barclays, expected fintech to disrupt the financial industries. Jenkins warned for an ‘Uber-effect’, meaning that fintech would disrupt the banking industry comparable to how Uber disrupted the taxi industry (Chatham House, 2015). However, the feared fintech revolution did not happen as expected. Instead, banks started to become tech companies themselves. As a result of the decreasing information costs and increasing community engagement, companies are constantly faced with the pressure to innovate. Incumbent banks often rely on their legacy systems, which makes it difficult for them to innovate in the same manner as the smaller startup companies (Smal, 2019). One way of innovating is through corporate venturing activities (Narayanan, Yang, and Zahra, 2009). Through corporate venturing, firms invest in internal intrapreneurial initiatives (Burgelman, 1983), as well as external startup companies (Covin and Miles, 2007).
Generally, the objective of such corporate investments in entrepreneurial businesses is to develop new capabilities and to explore possible domains or industries. An efficient collaboration between the investing firm and the entrepreneurial business is necessary for this learning and development process. Research suggests that there are different types of barriers to overcome in order to achieve this efficient collaboration. One example of such barrier is the flexibility of the organizational identity (OI) (Zucker and Darby, 1997). OI is described as the characteristics of the organization that its members perceive as central, distinctive, and enduring (Albert and Whetten, 1985).
Research has identified multiple strategies of how organizations flex their organizational identity for inter-firm collaborations. For example, technological transformation in virtue of leveraging managerial capabilities (Zucker and Darby, 1997), selective forgetting of undesirable characteristics of the organization (Anteby and Molnar, 2012), coming up with a transitional identity specifically for mergers (Clark, et al., 2010).
However, from the perspective of organizational identity, the source of this rigidity and the way that managers can flex this rigidity remain underexplored, especially in corporate venturing studies. An OI-based view of this phenomenon has important implications for both theory and practice.
There is extensive literature on the topic of organizational identities, covering the basic definition, having multiple identities (Foreman and Whetten, 2002), flexible identities as a result of liquid modernity (Ahuja, Nikolova, and Clegg, 2020), and how organizational identities influence the perception of the external environment, including innovation (Raffaelli, Glynn, and Tushman, 2019). The effect of the organizational identity on the innovation activities organizations has been researched thoroughly by Raffaelli et al. (2019). In their research, they state that a flexible organizational identity results in a wider view of the innovation opportunities, thus increasing non incremental innovations. However, their research only covers the relationship from the perspective of the organizational identity, how the identity influences whether or not the organization rejects non incremental innovations. There is a research gap on the topic of how corporate venturing activities, in turn, influence the flexibility of the organizational identity.
Hence the research question of this thesis: how do corporate venture activities influence the flexing of a business’ organizational identity? To address this theoretical gap, interviews were held with multiple individuals within a financial institution, which has adopted a new strategy in 2017 resulting in flexing the organizational identity. The research is held in The Netherlands, where the financial institution is located. This study contributes to multiple streams of literature. First, in the field of organizational identity, it enhances our understanding of the rigidity of OI’s and how these can be flexed through pursuing innovation through corporate venturing. Second, in the field of corporate venturing, this study provides knowledge on the consequences that corporate venturing has on the characteristics of the organization. Also, with an almost 500% increase of corporate venture capital expenditures in 2013-2018, it is important to gain an in-depth understanding of this phenomenon, providing insights which could be used by corporations.
Chapter 2: Theoretical Framework
§2.1 Introduction
In the theoretical framework, multiple theories and definitions are discussed, being the foundation on which this research is built. In the first part of the theoretical framework, the external environment in the banking industry is discussed, covering the rise of multisided platform business models and institutional changes in the form of regulations. In the second part of the theoretical framework, different ways for banks to innovate are discussed, especially focusing on corporate venture activities. The third part of the theoretical framework covers the concept of organizational identity, by explaining how this shared identity influences perception of the members of the organization, and by describing the effect of frame flexibility and multiplicity of organizational identities.
§2.2 Context to the Research
As a result of increasing community engagement and decreasing information costs, organizations need to look beyond existing business models and examine new approaches that capture this creativity of external innovators and parties (Altman et al., 2013). In 2019, Payment Service Directive 2 (PSD2) is adopted as a successor of PSD and is in force from the 19th of February. As explained by the Consumentenbond (2019), the purpose of PSD2 is that it will lead to more competitiveness and result in more innovation in the banking industry. PSD2 forces banks to share their user data. The Dutch Consumers Association (Consumentenbond, 2019) explained that this directive results into new types of services, leading to the financial environment becoming more dynamic and hostile and forcing the banks to innovate. Brodsky and Oakes (2017) concluded that this regulation benefits the clients as well as results in more innovation and more competition. Also, the banks’ roles may shift as it introduces a new financial services ecosystem.
§2.3 Innovation and Corporate Venture Activities
Henderson and Clark (1990) described innovation as the process or activity of refining and improving an existing design, or introducing a new concept that departs in a significant way from what has been there in the past. In their research, they differentiated between three
categories of innovation, namely incremental innovation, radical innovation, and architectural innovation. An innovation is categorized as incremental when the changes are relatively small. Incremental innovation further exploits the potential of the established design, which is why it is seen as competence enhancing (Tushman and Anderson, 1986). This type of innovation reinforces the capabilities the incumbent organizations, thus reinforcing their dominance. Radical innovation is based on a completely new and different set of engineering and design principles, often resulting in entirely new markets (Henderson and Clark, 1990). Because radical innovations are so different from past practice, it often results in difficulties for the established firms and great opportunities for new entrants. Radical innovations are also seen as competence destroying innovations (Tushman and Anderson, 1986). The architecture of a product refers to the way that the core design concepts are linked to each other. Architectural innovation is innovation where the core concepts of the product remain the same, but the way that these concepts are linked changes. The innovation has a significant effect on the relationships between the components, but not on the components itself.
One way to innovate is through corporate venturing. As described by Narayanan et al. (2009), corporate venturing is the set of organizational systems, processes and practices that focus on creating businesses in existing or new fields, markets or industries. This can be done through internal as well as external means. Internal means include innovation and new business incubation. External means include acquisitions, joint venturing, licencing, and corporate venture capital (CVC). Corporate venturing is closely linked to innovation and strategic renewal. In comparison to general investing, CV investments often generate lower financial returns (Narayanan et al., 2009). However, the value of CV’s should not solely be assessed based on the financial measures, since strategic benefits are not included. CV investments enable the incumbent organization to gain access to the resources of start up companies, which may lead to significant changes in the organization’s business, its strategy, or renewing its operational activities (Narayanan et al., 2009).
The internal means of pursuing CV is explained by Burgelman (1983) in ‘A Process Model of Internal Corporate Venturing in the Diversified Major Firm’. Burgelman (1983) suggests that the autonomous strategic initiatives of individuals within the organization is the motor behind corporate entrepreneurship. These initiatives are one of the most important resources for maintaining the corporate capability for renewal, through internal development (Burgelman, 1983). These initiatives often lead to difficulties, because the incumbent
organization generally deems the objectives set by the initiative to be impossible. The incumbent looks at the initiative from its own perspective, resulting in this rigidity. Linking the strategic initiative to the corporate strategy has a key role in the success of these initiatives (Burgelman, 1983). Thus, managing these is crucial.
From the external means of these CV activities, corporate venture capital is central for this research. Chesbrough (2002) described corporate venture capital as directly investing corporate funds in external startup companies. In ‘Making Sense of Corporate Venture Capital’, Chesbrough (2002) explained that corporate venture capital investments have two characteristics by which they can be defined, resulting in classifying the CVC investments into four different types. The first characteristic is the goal of the investment (Chesbrough, 2002). The goal of the investment is most often one of two types, namely investing for strategic benefits or investing for financial benefits. The second characteristic by which a CVC investment can be defined is the degree to which the operational activities of the investing company and the startup are linked. Chesbrough (2002) suggests that CVC activities can result in strategic benefits and company growth. Thus these types of investments should not be valued only on their financial returns.
§2.4 Organizational Identity
When people think of identities, often the first thing that comes to mind are individuals. However, having identities is not exclusive to individuals. Identities are a multilevel construct. They are also conceptualized in groups of people, such as business units, organizations, or even entire industries (Foreman and Whetten, 2002).
Organizational identity consists of two parts, namely an internal part and an external part. The internal part of organizational identity consists of how the company views itself, how members of this organization view their own organization (Albert and Whetten, 1985). The external part is sometimes also referred to as the image of the organization, how others view your company (Dutton and Dukerich, 1991). Albert and Whetten (1985) described the organizational identity as the characteristics of the organization that its members perceive as central, distinctive, and enduring. In other words, the characteristics that are seen as fundamental to the organization, uniquely descriptive of the organization, and persist within the company over time.
The degree to which members of the organization define themselves by the same attributes that they perceive also define the organization, is called organizational identification (Dutton, Dukerich, and Harquail, 1994). In their article, Foreman and Whetten (2002) stated that various researchers argue that the organizational identification process happens by members comparing their own identities to those of the organization, and that these identity comparisons influence the attitude of the members towards the organization. This identity comparison process has two common approaches. In the first approach, the member compares the organizational identity with their own identity, which is a direct comparison. The second approach is an indirect comparison, where the member compares the organizational identity to the preferred organizational identity of the member. In this second approach, the identity that the member prefers of the organization is an extension of their own personal identity, hence it being an indirect comparison (Foreman & Whetten, 2002). In their research, they show that the members’ level of organizational identification is more reflected in their affective commitment, rather than in their continuance commitment. Affective commitment is described as the degree to which a member wants to stay with the organization, their emotional attachment to the organization. Continuance commitment is the degree to which a member needs to stay within the company (for example, due to financial reasons), depending on the opportunities and possibilities to leave. What this means is that the member wanting to remain with the organization reflects the organizational identification more than simply identifying with the identity because the member is forced to do so (Foreman and Whetten, 2002).
Similar to humans, organizations can have multiple identities. These identities can conflict with each other and thus they need to be managed (Pratt and Foreman, 2000). When multiple identities are present within the same organization, it does not mean that these are necessarily contrary to each other, or in conflict. Also, these multiple identities do not need to be consciously held all the time, nor do they need to be shared by all members of the organization (Pratt and Foreman, 2000). For example, different identities can be held by different units within the organization. As explained by Pratt and Foreman (2000), having multiple identities can have its benefits and its costs, depending on the specific organization and its environment. An example of a benefit of having multiple identities is that these companies find it easier to retain a broader range of people, which results in the enhancement of the capacity for creativity and of learning. An example of the potential costs of having
multiple identities is that this may lead to conflicts between identities, which can lead to inconsistent action or no action at all. Having multiple identities can also negatively influence the strategic management of the organization (Pratt and Foreman, 2000). Since having multiple identities has potential advantages and disadvantages, Pratt and Foreman (2000) came up with a framework to explain when multiple identities are beneficial and when they are harmful. Managers can reach the optimal level of identity multiplicity in two ways, firstly by managing the number of identities, and secondly by managing the relationships between the existing identities.
As stated by Ahuja et al. (2020), established notions of identity in management theory seem out of date. The conditions under which members of society act change more rapidly than it takes to form these actions into habits (Bauman, 2005). This is his conceptualization of ‘liquid modernity’, an era of individualization, fluidity of solidarities, deregulation. As a result of this liquid modernity, together with technological change, authority structures, and employment relation, organizations are changing (Ahuja et al., 2020). Constantly changing structures, processes, and norms are replacing the stable anchor points for constructing one’s identity. The dynamics of this these rapidly changing workplaces shape the identity in new ways (Ahuja et al., 2020). Due to the liquid, multiple, and shifting identities, the organizational environment gets evermore complex. The process of forming, maintaining, repairing, revising, or strengthening the identity is called ‘identity work’. As a result of these changing social contexts, such as organizations, identity work is increasingly becoming important. People seek to balance stability and change through identity work (Ahuja et al., 2020).
§2.5 Organizational identity and (its Influence on the Perception of) the External Environment and Innovation
In Product-to-Platform Transitions: Organizational Identity Implications, Altman and Tripsas (2015) conducted a research on the relationship between the organizational identity and the transition from a product-based business towards a platform-based business. Altman and Tripsas (2015) proposed that the transition from a product-based company towards a platform business is not simply a change in operational activities, but also requires examining the organizational identity because it might challenge how the organization views itself. Besides examining the identity during the transition, the organizational identity can also influence
whether or not the organization wants to become platform-based in the first place (Altman and Tripsas, 2015). The companies that are discussed in their research mostly had difficulty matching their organizational identity with the required activities for this transition. However, Altman and Tripsas (2015) also recognized that organizational identity can be reinforcing and supportive of these activities and changes.
As described by Altman (2015), the way that organizational members view their company also results in shared views on how the company operates. These views make up the expectations and routines that coordinate the behaviour within the company. Organizational identity has been used to show how organizations identify threats, interpret issues, how they solve conflicts, establish competitive advantage over other companies, how they manage change, and how they frame their strategies and responses (Foreman and Whetten, 2002). Tripsas (2009) also mentions that the organization’s identity filters the interpretation of the external environment. Hence, organizational identity influences the way employees view their external environment, and thus influences the way they look at new technology and innovation. This relationship between organizational identity and innovation is further researched by Raffaelli et al. (2019). In their research they focused on why incumbent firms often reject non incremental innovations. Non incremental innovations consist of radical and architectural innovations, because adoption of radical and architectural innovations present the most significant tensions for the adopting firms. In their research, Raffaelli et al. (2019) find that one of the factors behind this phenomenon is the degree of frame flexibility. Frame flexibility is described as the capability to cognitively expand the categorical boundaries of the innovation and to cast the innovation as emotionally resonant with the organizational identity, with its competencies, and its competitive boundaries. These factors influence how the organization perceives innovations, and that by broadening these by having frame flexibility, the organization increases the likelihood of adoption. Frame flexibility consists of cognitive frame flexibility and emotional frame flexibility. Cognitive framing is the process of thinking, providing a framework through which individuals can give meaning to information. It is also described as the interpretive lens through which we look at the environment. Emotional framing is the process of feeling, so providing a framework through which individuals align their emotions with the environment. Raffaelli et al. (2019) explained that during technological change, an inelastic organizational identity and a rigid definition of the innovation boundaries hold the organization hostage to its past. Having
multiple organizational identities, or transitioning from one to another, increases frame flexibility, which, in turn, increases adoption of non incremental innovations. When the management team of an organization reinterprets the firm legacy strategy, they bring innovations into greater alignment with the organizational identity, which initially would have seemed incompatible (Raffaelli et al., 2019). Organizational identity shapes the cognitive framing of innovations (Tripsas, 2009). Kogut and Zander (1996) stated that organizations can rule out possibly interesting innovations because their organizational identity reinforces their current competencies and strategy. When their organizational identity is elastic, a wider set of innovations will be perceived as aligning with the organization's competencies and strategy.
The effect of organizational identity on the perception of the external environment, including innovation possibilities, is clear in the literature. Raffaelli et al. (2019) have explained how this effect depends on how elastic the organizational identity is. However, research lacks the opposite relationship. How does innovating through corporate venturing influence the flexibility of the organizational identity?
Chapter 3: Methodology
§3.1 Introduction
The aim of this study was to find out how employees are experiencing the effects of corporate venture capital on their perception of the company, on their general understanding of the organizational identity, and other influences as a result of these activities. This chapter
discusses in detail how the research was conducted. Starting off by discussing the typology of the research, followed by the sample composition, after which the data collection is
explained, how the data was analyzed, and lastly, the quality procedures of the research. §3.2 Type of Research
Research methods are specific procedures for collecting and analyzing data. Since the purpose of the research is to expand the knowledge on the specific topic, this is a basic research. This means that it aims to develop knowledge and theories in contrary to
developing techniques for solving a specific problem, which would be applied research. The choice of research methodology depends mainly on the nature of the research question. This research focused on exploring how corporate venture capital activities help an organization in redefining itself and thus in flexing its organizational identity. To explore this phenomenon, the values and interpretations of the employees were necessary to build up theory around this experience. For explorative studies, qualitative methods are a suitable choice (Strauss & Corbin, 1990). Hence, qualitative research methods were used. Qualitative research methods are best for describing, interpreting, and gaining in-depth insights into a phenomenon
(Seidman, 2006). Since there has not yet been any other research on this topic, we were not looking for precise causes and conclusions, but more an exploration of the main aspects. Thus, the research is inductive, because there were no hypotheses based on prior research. §3.3 Sample Composition
Four individuals within a large Dutch financial institution were interviewed. The financial institution is ABN Amro, which is currently the third largest bank of the Netherlands (Corporate Finance Institute, 2020).
In 2017, ABN Amro drastically changed its vision and mission, switching to an all-new strategy. Also, ABN Amro is actively managing their corporate venturing activities. Because of these factors, the bank was a suitable organization for this research. Through this transition ABN Amro is changing its organizational identity, focusing on having a positive impact on the long term through sustainable development. Since the first real announcement on climate change, ABN Amro has been focusing on becoming more sustainable. In 2007, ABN Amro was listed as part of 'The Global 100 Most Sustainable Corporations in the World 2007', in the ranking by Corporate Knights (2007). Although ABN Amro has been busy with making their own business processes more sustainable, they also impact the world through how they manage their investments. ABN Amro has also been in the news because, at the same time that they were claiming to be focusing on sustainability, they were investing their clients money in harmful industries. Fast forward to 2017, ABN Amro announced that they were refocusing their strategy by adopting a new strategic purpose. They summarize this new purpose by calling it “banking for better, for generations to come”. As a result of adopting this new purpose and refocusing their strategy, ABN Amro is changing from a traditional bank towards a financial institution focused on the wellbeing of the planet. ABN Amro is here to have a positive impact on the world. Since this refocus, also their investments have been targeting sustainable solutions, and the bank stopped investing in harmful industries such as the weapons industry or the fossil fuel industry. Another factor that plays a role in the transition of identities is the increased competitiveness due to institutional change, which results in an increase in innovation. As explained in the theoretical framework, this forces banks to innovate. In 2015 ABN Amro set up the Digital Impact Fund, their corporate venture fund with a budget of €10 million. In 2018, as a result of the successes of the fund, the bank increased their budget to €50 million, and in 2019 to €100 million.
The sample for this research consists of four participants, working for ABN Amro. Two of these individuals work in the innovation department of the bank, one employee has worked in the innovation department for a long time and now divides up his time between being the head of business development at one of the ventures of ABN Amro as well as running an innovation program within ABN Amro, and one employee works at the
communications department of the bank. Through interviewing these individuals, data was gathered on how the organization undertakes corporate venture activities, and how these help in flexing the organizational identity. Reginald de Wasseige is a 29 year old male, working as
an associate at ABN Amro Ventures, which is the corporate venture fund of ABN Amro. Reginald joined the company in August 2019, so he has been working for ABN Amro for 10 months. Menno van Leeuwen is a 46 year old male. Menno started working at ABN Amro 21 years ago, where he did several jobs in different areas. Over seven years ago, Menno started working in innovation, where he set up the Digital Impact Fund in 2015, as part of ABN Amro Ventures. After setting up the DIF, Menno joined Moneyou, where he built a new mobile banking as a subsidiary of ABN Amro. Currently, Menno is the Head of Business Development at Moneyou, and runs an innovation sustainability program for ABN Amro. Allan Ventura da Silva is a 33 year old male. Allan has worked as a business analyst and project manager for Rabobank in Utrecht, after which he worked as an innovation manager at a smaller company. Since July 2018, Allan has been working at the innovation department of ABN Amro, where he is a technical innovator and product owner of the Dataistic Center. The Dataistic Center is an initiative between ABN Amro and Dell Technologies, founded in 2018, which gives universities, scientists, and third parties access to ABN’s and Dell’s knowledge and hardware. The purpose of the Dataistic Center is to help society with data-driven
solutions. Martijn Swijghuisen Reigersberg is a 50 year old male. Martijn started working at ABN Amro 7 years ago, and currently is the Head Campaigns, Social, and Newsroom. This means that he is in charge of the communication of the strategy internally to the employees of the company, as well externally to society.
Interviewees Reginald and Allan were found through snowball sampling. After having contact through email with someone within ABN Amro Ventures, this person provided the contact information of Reginald, saying that he would be able to help with the research. After our interview, Reginald then sent the contact information of Allan. We employed purposeful sampling for selecting Interviewees Menno and Martijn, since Menno has been working at ABN Amro for 21 years, and has more than 7 years of experience working in innovation, and Martijn has been working at ABN Amro for 7 years, and we wanted to have also a non-innovation department perspective to give a broader view of the phenomenon. Menno and Martijn were found through separate personal connections. §3.4 Data Collection
For the research, both primary and secondary data have been used. Primary data is the data collected directly by the researcher, which, in this case, is retrieved from the interviews.
Secondary data is data that has already been collected by someone else. In this research, the secondary data consists of the basic definitions and theories in the theoretical framework.
A semi-structured interview was used as a method of data collection, which entailed a set of questions with different levels of complexity (the Appendix shows the general
protocol). Semi-structured interviews are interviews in which the interviewer does not strictly follow a formalized list of questions. Semi-structured interviews are characterized by the usage of an interview guide, which lists the questions or issues that are to be explored in the interview. It allows for two-way communication, where certain questions will be answered, but the interviewee still has the space to open up and explain their thoughts and reasoning. Semi-structured interviews provide reliable, comparable data for qualitative research (Patton, 2002).
The interview guide, thus the interviews, were structured according to Patton (2002). Patton suggests starting the interview with some non controversial questions on present behavior, activities, and experiences. These lighten the mood and encourage the respondent to talk descriptively. The quality of the obtained information is largely dependent on the interviewer (Patton, 2002). To obtain optimal quality, the questions in the interview guide were open ended, non-dichotomous, singular, and clear. Overall, four interviews were held, one with each participant, over a timespan of two weeks. Each interview was 30-70 minutes in length, digitally recorded, and transcribed. As a result of the current COVID-19 virus, the interviews were held through different video call services, to mitigate the risk of participation for the interviewees.
§3.5 Data Analysis
The interviews were recorded using a digital audio recorder. After the interviews were held, the audio was transcribed. In order to closely examine the data and to identify themes, thematic analysis was used on the transcriptions, following a grounded theory approach. The data analysis took the form of coding the interviews which implied finding main themes of each response from all the interviews. We began our analysis by identifying relevant concepts in the data and grouping them into categories, resulting in the formation of ‘open codes’. For this analytical process, we used in-vivo (Strauss and Corbin, 1998) or a simple descriptive phrase when an in-vivo code was not available. Next, the open codes were grouped together under umbrella terms based on their relation with each other, resulting in the formation of
axial codes (Strauss and Corbin, 1998). Third, selective codes were established after arranging the axial codes depending on their relationship to the flexing of the organizational identity. The data were analyzed repeatedly through coding, until theoretical saturation was achieved (Glaser and Strauss, 1967). After coding all of the transcripts, a data structure was built following the methodology of Gioia, Corley, and Hamilton (2012). In this data structure, the open codes were used as ‘1st order concepts’, the axial codes as ‘2nd order themes’, and the selective codes as ‘aggregate dimensions’.
§3.6 Quality Procedures
The criticism towards qualitative research is mostly based on the topics of dependability and transferability. No matter how diligently the researcher works, the interaction between the interviewer and the interviewee is essential in interviewing. The interviewer asks questions, responds to the participant’s answers, interprets, describes, and analyzes the data (Seidman, 2006). The interviewer is part of the process, hence qualitative research is perceived as more subjective than quantitative research. In qualitative research, achieving reliability is
especially difficult. As explained by Silverman (2006), a research is reliable/dependable when replicating the same research at another time and place would come to the same result. Often in qualitative research, reproducing the same research does not lead to the same results because of different contexts. Also, generalization of the results is difficult in qualitative research, since it is often looking at specific phenomena. However, qualitative research aims at understanding and exploring a certain phenomenon, so generalization is not the main goal (Bryman, 2008).
Prior to the interviews, the participants received a consent form including the topics of the questions as well. The consent form was set up following the criteria of Seidman (2006), to achieve informed consent. These eight criteria consist of an invitation to participate in the research with an explanation of what their participation includes, potential risks for the participant, rights of the participant, possible benefits for the participant, an explanation of the confidentiality, an explanation of how the researcher is planning to disseminate the data, special conditions for children, and contact information of the researcher.
Chapter 4: Findings
§4.1 Introduction
For the findings, the following data structure and model are used to explain how corporate venturing influences the flexing of the organizational identity. Firstly, the past characteristics of ABN Amro will be discussed, comparing them to the present or future characteristics. The past characteristics of the organization represent a more rigid OI, whilst the present characteristics represent a more flexible OI. The change in the organizational identity is clearly visible. Secondly, the rigidity will be discussed, going into what causes an OI to be rigid in contrast to being flexible. Understanding what causes an OI to be rigid is necessary in order to understand how CV affects this rigidity and flexes the OI. Thirdly, the 2nd order theme of external changes, and how these resulted in a strategic refocus will be elaborated on. This 2nd order theme covers the 1st order concepts on the changes in the environment of the organization, as well as how these changes made the organization realize that change is necessary for it to survive as a company, thus resulting in a strategic refocus.
§4.2 Change in Organizational Identity
The organizational identity was the foundation of this research. Throughout the interviews, the participants described both the past as well as the current or future characteristics. Changes in the environment forced the organization to redefine itself in order to adapt and survive. As a result, ABN Amro adopted a new strategy and a new purpose, transitioning from a narrow organizational identity towards a broader organizational identity.
§4.2.1 Rigid Organizational Identity (Past)
There are multiple 1st order concepts that fall under the 2nd order theme ‘rigid organizational identity’. The participants described the organizational identity from the past as ‘internally focused’, ‘risk avoidance’, ‘unclear vision and mission’, ‘only working with large corporations’, ‘not willing to adapt’, ‘short-term perspective’, and ‘exploiting the legacy system’.
When describing the past identity of ABN Amro, Menno van Leeuwen stated that “ABN Amro was really internally focused. Doing everything ourselves or relying on one or two big partners. The bank was avoiding risk, and the curiosity of what was happening in the external markets was low.” Allan de Ventura Silva described the bank as stubborn, meaning its unwillingness to adapt to external changes. Hereafter, Allan made another clear statement about banks in general: “Banks, in general, relied a lot on their past. They relied on their traditional competencies, and were not really looking forward. They were not willing to adapt to change.” When Martijn Swijghuisen Reigersberg started working at ABN Amro 7 years ago, all business units had their own little strategies, which did not count up to one clear strategy. Also, the bank was very hierarchical, everything was organized top-down. Martijn mentioned this because of these two factors, the employee engagement was low and the employees were not motivated to come up with ideas by themselves. These statements describe the past characteristics of ABN Amro, where the bank had a more narrow and rigid organizational identity.
§4.2.2 Flexible Organizational Identity (Present/Future)
The organizational identity of the bank has been changing. Some of the recurring 1st order concepts used to describe the current organizational identity, which is a 2nd order theme, are
‘clear strategy’, ‘willingness to change’, ‘long term perspective’, ‘broader vision’, ‘opening up to collaboration’, and ‘contributing in multiple areas’.
As stated by Menno van Leeuwen, the goal of ABN is to be a global mass bank which is specialized in sustainability, and contributes to society in different areas. The bank aims to be a precursor in the sustainable and digital developments. The organizational identity of the bank is no longer solely tied to its financial operations, but uses these operations as a
foundation to contribute to society. When explaining what the innovation department of ABN Amro currently is focusing on, also Allan de Ventura Silva showed that the bank does not simply see itself as an organization which only provides financial services, describing the bank as having a broad vision and being active in different areas or domains.
§4.2 Causes of Rigidity
The participants described the causes of this rigidity of OI’s as ‘afraid of change’, ‘legacy systems’, ‘to-do lists’, and ‘moderate risk objective’.
Martijn Swijghuisen Reigersberg clearly stated that “the cause of the rigidity is the fear of change in general, but also the fear of losing your job as a result of this new
innovation”. Allan de Ventura Silva described that people are used to the way that they have always done things. This is present on an individual level, where people are currently in their comfort zone and do not want to change that, but also on an organizational level. The
organization is consists of legacy systems. Allan described that changing such large organizations is difficult, “They are like a puzzle; if you want to change one piece of the puzzle, you are affecting the other pieces as well. That is why it takes such a long time to change”. Martijn explained that the organization used to work with to-do lists, which made people feel like robots and not motivated to work hard. “If you’re doing something because you believe in it, you will work way harder than only doing it because an email tells you to”. This way of coordinating the employees and the work decreased the employee engagement, which, in turn, decreased their involvement and resulted in the employees only thinking about their daily routine. There was no room to come up with new ideas, creativity, and freedom. Martijn gave an example of this rigidness caused by being afraid of change and needing proof points to be able to change their mind. “When the CEO first announced that the organization would set the goal of sustainable real estate, where he wanted to have energy label A in all of the owned real estate by 2030, in comparison to 2050 which is the date given by the Dutch
Government, everybody was screaming that this would not be possible and that this is ridiculous. However when he pushed through, and showed that it would be possible,
everybody accepted it and started working on it”. In this example, the initial negative attitude of individuals towards change is very clear. Another cause of this rigidity is explained by Menno van Leeuwen, when he discussed the risk assessment of investing possibilities. Menno stated that the organization was risk averse, really focusing on low and moderate risk investments. Thus, the organization did not look beyond a couple of very large firms to collaborate with.
Figure 2. Grounded Model of the Influence of CV on the Flexing of OI. §4.3 Causing the Transition
This aggregate dimension represents the statements of the interviewees about the transition of the narrower identity of the past towards the broader identity of the present. This aggregate dimension consists of the 2nd order themes ‘external changes result in realization that change is necessary to survive’, and ‘strategic refocus’. The transition covers the causes for the transition towards a more flexible OI. As distinctly mentioned by Allan de Silva Ventura and Menno van Leeuwen, this process of opening up is a gradual process. Menno specifically said: “We are an organism. We will change, we will evolve, we will explore”. After which he stated that this is the case for all organizations, and mentioned that the answers would be the
same if the research was held at Rabobank or ING. Martijn Swijghuisen Reigersberg described the transition as a journey, which the organization is undergoing. “Inside the organization, we tell ourselves that we’ve just started on this journey’.
§4.3.1 External Changes
All four interviewees explained this transition has been triggered by changes in the environment. The 2nd order theme of external changes covers the following 1st order concepts; ‘changing customer demands’, ‘changing/increasing regulations’, ‘changes in technology’, ‘rise of fintech’, ‘sustainability’, ‘data driven developments’. Reginald de Wasseige stated that multiple aspects of the environment of the bank have been changing, which all are relevant for the organization. One of the changes in the environment is the continuously increasing customer demands, increasingly demanding top quality and personalized services. These demands can be met through a digital channel. This shift from physical contact with the customers to digital is a clear sign to focus on this new, digital way of doing things. Another shift in the customer demands is the increasing attention towards sustainability. A second change in the environment is the increase of regulations. Especially after the 2008 global financial crisis, these have been actively changing. An example given by multiple interviewees is the PSD2 regulation. But not only formal legislations have been increasing in the last couple of years. Menno van Leeuwen also mentioned semi-legislations, such as the increasing role or duty of the bank to detect and prevent financial crimes. The role of the bank as an extension of the government. Reginald de Wasseige mentioned technology as a driver of change. Similarly, Allan de Ventura Silva stated that “Everything is becoming more and more data driven”. The recent boom of fintech has resulted in an unbundling of financial services. In the past, the bank was a one-stop destination for all financial services, but fintech’s often specialize in one of those services. These specialized fintech’s have been reinventing the banking industry.
§4.3.2 Strategic Refocus
The 2nd order theme strategic refocus is made of the 1st order concepts ‘new CEO & Board’, ‘digital transformation’, ‘sustainability shift’, ‘gradual process’, and ‘strategic refocus’. As a result of these changes in the external environment of the organization, as well as the appointment of the new CEO and the Board changes in 2017, ABN Amro underwent a
strategic repositioning. Martijn Swijghuisen Reigersberg explained, that this strategic refocus had a significant effect on the organization. With the new board, the strategy became more centralized. All business units did not have their own separate strategies anymore, but were part of a larger strategy. This caused the overall vision to be more clear, making the members feel their works contribution, resulting in a higher employee engagement. This strategy refocus came with a new mission and vision, summarized under the purpose of “banking for better, for years to come”.
Reginald de Wasseige explained the changes clearly in his interview. The previously short-to-medium term perspective got traded for a medium-to-long term perspective. Consequently, there were two major changes in the focus of the organization. Firstly, the increased focus towards digital developments, through which ABN Amro wants to reinvent the customer experience. To emphasize the scale, Reginald explained that the bank did not hold back when it came to putting in the resources necessary for this new focus. The other major change in the focus was their new objective ‘accelerating the sustainability shift’. As a bank, ABN Amro feels that it is her responsibility or duty to make this world a better place. Martijn explained that “through accelerating the sustainability shift, the bank wants to help its clients change towards more sustainable business models”. But this also goes for the private clients, an example that Martijn gave was “the bank encourages people who are buying a house to become more sustainable through easing their mortgage rates if they have a better energy label or solar panels”.
Martijn explained that ABN Amro is highly determined to bring this positive change. An example he mentioned was the bank’s real estate objective. Although the Dutch Government’s objective is to have all real estate the ‘energy label’ A (most sustainable) by 2050, ABN Amro aims to have all of their real estate to have this energy label A by 2030. Through these types of changes, the bank aims to accelerate the sustainability shift.
§4.4 Results of the New Strategy & Purpose
The aggregate dimension of ‘results of the new strategy and purpose’ covers the changes as a result of the strategic refocus, which consist of the 2nd order dimensions ‘more collaborating and exploring through CV’, ‘communication of the new strategy and involving employees’, and ‘increasing employee engagement’. The former two are linked together closely, by consisting of a couple of same first order concepts, and by influencing each other.
§4.4.1 Increase in Explorative Innovation and Collaborating (through CV)
The 2nd order theme of ‘increase in explorative innovation and collaborating (through CV), consists of the the 1st order concepts ‘innovation strategy’, ‘focus on digital developments’, ‘opening up to collaborations’, ‘increase in venture activities’, and ‘increase in venture fund’. As stated above, the changes in the environment have resulted in the banks adopting new technologies. Reginald de Wasseige explained that there are three major processes through which the organization pursues these innovations. The first one is an innovation department that works on in-house projects and explores new technologies. The second way the company innovates is that every team is allowed to collaborate with external parties. This is also where the ventures department is located. The third process through which ABN Amro pursues innovation is the intrapreneur track within the company. Here, people that work within the bank can launch a product or service in a safe environment and have the opportunity to scale directly if it succeeds.
Mentioned earlier, Allan de Ventura Silva explained the three major areas on which the innovation department of ABN Amro is currently focusing. These three areas or domains are outside of the daily operational activities of the bank, thus show its broad and flexible mentality. The first one is smart cities and sustainable urban areas, where everything is connected. The second one is digitization and digital transformations. So much data already exists, in this area the bank is trying to find ways on how to optimally use this. For example through collaborating with organizations outside of your industry to get new perspectives. The third area is platformication, which focuses at the opportunities to become part of a platform, or to even set one up themself. When explaining these three areas of focus, Allan described the perspective and scope on these areas as “what role can a bank play here?”. The bank does not see itself as the organization that only manages your account and gives out mortgages anymore. This attitude towards innovation has changed in the last couple of years, visible in the increase in the number of innovations and ventures and the tenfold increase of the ventures department, Menno stated. The way the bank operates is more and more through collaborating with other companies. For example, there are multiple fintech collaborations running through the organization, and three years ago, the bank started to create its own ventures of itself. Menno gave an example of how the bank is embracing the ecosystem and external collaborations. “The Digital Impact Fund is really anchored in the external market,
to obtain new ideas and potential collaborations or investments. We also do this by collaborating with initiatives with smaller, innovative companies.” Later in the interview, Menno again confirmed that ABN Amro is looking into a broader spectrum of industries, looking especially at the long term position of the bank. “We have a new group for innovation that focuses on big topics, which are more horizon three.”
Later in the interview, Allan explained how the innovation department explores markets and tries to find attractive opportunities that are not connected to the traditional banking services. They’re looking for innovations that people would not necessarily associate with being a bank. For example, the energy sector, or healthcare. An example of the bank opening up is the Dataistic Center, which Allan set up. Here the bank collaborates with organizations from different domains, such as universities, hospitals, NGO, and more. The main goal of the Dataistic Center is to find new ways to give back to society through new ways to use data. Through combining data with other parties from different domains, the Dataistic Center is exploring a lot in this new area, and tries to break free from the legacy system and the past identity. When looking at the external environment, they are not tied to the legacy system, but they try to find new ways to do things, new environments to explore, and new customers to reach, and all the knowledge gained through this exploring flows back to the bank.
§4.4.2 Communicating the New Strategy and Involving the Employees
The following 1st order concepts fall under the 2nd order theme of ‘communicating the new strategy and involvement of employees’: ‘having a clear strategy and purpose’, ‘improved communication of the strategy’, and ‘knowing what is expected of you as an employee’, and ‘employee engagement’. This 2nd order theme covers the communication and involvement of the employees, especially looking at the new strategy and the new purpose, and how this strategic refocus affected the employee engagement.
Martijn Swijghuisen Reigersberg has been working at the communications department organization for seven years now. The interview with Martijn mostly covered the changes that the organization has seen as a result of this new purpose and this new strategy, rather than focusing on corporate venturing. Since Martijn’s work consists of communicating the new strategy, and because he does not work in the innovation department of the
organization, in contrast to the other participants, his participation provided new insights for the research.
Communicating the new purpose was a project that the organization had been working on for two years. Initially starting in a project group, slowly growing larger and larger, trying to get it ‘carried’ by the employees. Martijn stated that it does not work coming up with a strategy in isolation and suddenly announcing it. People will not accept it and will not feel connected with it. “It is very important to make the employees carry this new purpose and let it spread this way. We could do all the internal marketing and communicating
programs to promote the new purpose, but if the employees don’t believe in it and if they don’t want it, it will not happen. That’s also something which is present in large
organizations like these. It is very easy to hide from something if you don’t like it. People always have the opportunity to not do something”. The way the bank was organized also influenced the employee engagement and the communication. When Martijn started working at ABN Amro, everything was managed in lists, do’s-and-don’ts. This is not optimal when trying to communicate a new purpose and strategy, he said. “You do not want people to do something because there is an email telling them to do so. You want them to do something because they believe in it. Then they will be intrinsically motivated, which makes them work harder.”
The employee engagement was not always as high as it is now, Martijn explained. Partly, because of the unclear strategy. Employees stated that they were lacking the vision and direction from the senior leadership, resulting in unclear expectations. The employees did not know what their contribution was to the broader picture. Martijn described that the
sharpening of the strategy, together with the new purpose which consists of values that resonate with the employees, really cleared up the direction that the organization wanted to go. When the new strategy was introduced in 2017, this was also one of the focus points, resulting in the employees feeling more of a connection with the organization. Martijn stated: “Suddenly people saw what their contribution was, what impact they could make with their work, and I think that was very important”. In the last couple of years, this employee engagement has increased significantly. One of the reasons for this is the focus of aligning the values of the employees with those of the organization. “I see myself as a representative of the organization, so it would be weird if I did not support what the bank stood for. This is also something that the bank is currently focusing on. Based on certain personal values and
characteristics, to determine your fit with the purpose of the bank”. These criteria are also looked at when the organization is hiring new employees, making sure that the new
organizational members share the values of the bank. Another change which also increased the employee engagement is the level of hierarchy within the organization. Martijn explained that the bank used to be very hierarchical, very top-down. This is becoming more and more bottom up as well, allowing employees to come up with their own ideas and initiatives. §4.5 Changing Mindsets through Involving Employees from throughout Entire Organization
This aggregate dimension represents the relationship between the formerly discussed two changes resulting from the strategy refocus. This aggregate dimension consists of the 2nd order theme ‘involving employees and exposing them to CV’, which, in turn, consists of the 1st order concepts ‘inspired by examples’, ‘broadening vision’, ‘opening up to collaborations’, ‘having room for discussion’, ‘investment committee’, ‘changing mindsets’. The increase in corporate venturing, together with the increase in employee engagement and involvement, exposes the employees to the successes of these types of innovation, which fall outside of the usual areas of innovation relating to the rigid OI. This exposure to positive examples opens up the mindset of the employees, inspires them to think about how they can improve their own daily lives, and ignites innovation within the organization. Thus, as a consequence of venturing activities and employee involvement, the OI becomes more flexible. Moving from a narrow perspective towards a broader perspective is something that does not happen simply in one night. As briefly discussed before, Martijn Swijghuisen Reigersberg said that people are afraid of change. Thus, transforming mindsets is a gradual process which needs time.
Reginald de Wasseige mentioned two ways in which venturing influences the mindset of the employees. The first one he mentioned is by involving employees from throughout the entire organization in the innovation process. When looking for new innovations, the department has discussions with employees about their problems they encounter in their work. Reginald described the results of this involvement as follows; “I think by identifying, discussing with all those people internally, we're really forcing them to think about how they can improve their day-to-day life”. Another way people from different departments of the organization are involved in this process, is the ‘Investment Committee’. The Investment
Committee is the committee that approves or declines investment proposals made by the venture department. This committee consists of major stakeholders from throughout the entire organization, as explained by Reginald. This results in alignment of views regarding the external environment, and what to invest in. The second way in which venturing affects the organization is that it made the organizational members realize that the organization needs to collaborate to survive, Reginald stated: “I think it it has accelerated the mentality, the mentality shift, of people we're working with in the bank and by spending time opening the eyes of people within the bank. I think we can contribute to that shift.”
Martijn explained that in order to change someone’s opinion, this person needs to be convinced that this change is for the better, they need proof points to prove the benefits of this change. “People want proof that something is possible, but you can only get this proof when you start doing something. Only then, people start seeing the benefits of such change, and enthusiasm slowly appears between the employees”. When more and more people start believing in it, and something is proven to work, a tipping point is reached in changing mindsets. Also previously mentioned, Martijn stated that when you need something to change in the organization, such as the strategy or a certain mindset, this change needs to be carried by the employees. He described changes like these as cargo ships, “it takes a long while to get started, but when it moves the ball starts rolling”, meaning that once the mindset is shared between enough people, it gets easier and easier to spread further. Martijn mostly elaborated on mindsets changing regarding the new strategy, but this effect is also visible when looking at collaborations and corporate venturing. Reginald de Wasseige made the following statement about the influence of collaborations with external parties, through corporate venturing, on the mindset of the employees and thus influencing the transition. “Whenever a business relationship is going well, the mindsets are really changing in a very right direction. And for the time being, the vast majority of the relationships and the investments that we've done are going to the right direction. So people are becoming more and more aware that we need to partner and collaborate to actually shift, rather than building everything yourself.” So, the positive results of the venturing activities prove to employees that this opening up is a positive change, thus changing their mindsets regarding investment opportunities. Reginald stated that people are becoming more and more aware that the organization needs to open up in order to survive as an organization. Allan de Ventura Silva stated: “It’s definitely inspiring for other people in the organization, to show them what we are doing. They really are
interested in it, and a lot of people also have their own ideas of what we can do more as a bank and they come to us. To share those thoughts and then we have the dialogue. To have a department working on things beyond the traditional or activities, I think that's very, very inspiring for people”. Allan followed up by elaborating on the role of the innovation department when it comes to changing mindsets within the organization. Allan said “if you want to make a difference and change the way we do things, the innovation department is the best place to be”. He stated that this changing the mindsets is also one of the objectives in the department, asking themselves “how can we convince people that there are other options in the market that we can look at?”.
The change in mentality towards innovation is visible in the increase in the number of innovations in the past few years, and the tenfold increase in the budget for the ventures department. The way the bank operates is more and more through collaborating with other companies. Menno gives an example of this growth, stating that there are multiple fintech collaborations running through the organization, and three years ago, the bank started to create its own ventures of itself. One example of such venture is the peer-to-peer payment service Tikkie. All four participants mentioned Tikkie as an example, when describing the inspirational effects of corporate venturing on changing the mindsets of the employees. Tikkie is an initiative started in the innovation department of ABN Amro, at the time that Menno was working there. It was the first Technology-as-a-Service for the bank. Tikkie is an app which allows for quick peer-to-peer transactions. As explained by Allan de Ventura Silva, Tikkie is one of the most well-known innovations by ABN Amro. Allan described the effects of the success of Tikkie on the mindsets of the organizational members as follows: “I think that Tikkie definitely gave a boost to the company. If you see how successful Tikkie was and how everybody within the organization was talking about it, I think is was a nice example of how we could stimulate innovation in the bank”.
Participant Menno argues that if you look at all the venturing activities and put them together, you clearly see an influence on the mindset within organization. He described the effect of corporate venturing as ‘the oilman’, saying that the ventures are the oil which makes the transition towards a flexible OI run smoother. To conclude the relationship between venturing and flexibility of the organizational identity, Reginald stated that venturing speeds up the process of transitioning towards a more flexible identity.
Chapter 5: Discussion
§5.1 Introduction
This study aimed to explore the influence of corporate venture activities on the flexing of the organizational identity. Existing literature has identified multiple strategies of how organizations flex their organizational identity for inter-firm collaborations. For example, technological transformation in virtue of leveraging managerial capabilities (Zucker and Darby, 1997), selective forgetting of undesirable characteristics of the organization (Anteby and Molnar, 2012), coming up with a transitional identity specifically for mergers (Clark, et al., 2010). However, how managers can flex this rigidity of the OI remained unexplored, especially in corporate venturing studies. This research provides new insights on how organizations can flex their organizational identity, through actively focusing on corporate venture activities, in combination with increasing the employee engagement and involving the employees in the innovation process.
§5.2 Quality Measures
Guba and Lincoln’s (1985) concepts for defining and investigating quality in qualitative research have been used to describe the quality measures of this research. These concepts are credibility, transferability, dependability, and confirmability. Credibility is described as the degree to which the findings represent the experience of the participants (Guba and Lincoln, 1985). Since the analysis of this research was done by only one person, there was not a possibility to use the methods of triangulation to increase credibility. However, during the data collection, the interviewer often repeated the answer of the interviewee when it was perceived as an important piece of data, resulting in the interviewee elaborating more on the answer. Also, engagement between the participants and the researcher was relatively short so there was no room for prolonged engagement as a means to increase credibility. Guba and Lincoln (1985) describe transferability as the degree to which the findings are applicable in other contexts. Transferability is comparable to external validity, which is more often used in quantitative research. Extracting transferable concepts and principles allows our findings to address a larger audience (Lincoln and Guba, 1985). Gioia et al. (2012) agree with the old argument that it is not possible to generalize from a small samples, which is the case in this
