Corley Gio A

Identity Ambiguity andChange in the Wake ofa Corporate Spin-off

Kevin G. CorleyUniversity of Illinois,Urbana-ChampaignDennis A. GioiaThe Pennsylvania StateUniversity

© 2004 by Johnson Graduate School,Cornell University.0001-8392/04/4902-0173/$3.00.

We ihank Penn State's e-BusinessResearch Center for generously support-ing this research effcjrt and the membersof Bozkinetic for iheir time during thestudy. Wa also ttiank Jennifer Jones-Cor-ley, Linda Trevino, Karen Jansen, DennisGouran, Mike Pran. Kevin Rockman,Prasad Balkundi. Ra|iv Nag, and the mem-bers of Buzz for their help and support onearlier drafts of this paper. Finally, wethank Huggy Rao, Linda Johanson. andOur three anonymous reviewers for theirguidance of this manuscript through thereview process. An earlier incarnation ofthis paper won the Newman Award forbest paper based on a dissertation at the2003 Academy of Management meet-ings-

We report on the findings of an inductive, interpretivecase study of organizational identity change in the spin-off of a Fortune 100 company's top-performing organiza-tional unit into an independent organization. We exam-ined the processes by which the labels and meaningsassociated with the organization's identity underwentchanges during and after the spin-off, as well as how theorganization responded to these changes. The emergentmodel of identity change revolved around a collectivestate of identity ambiguity, the details of which provideinsight into processes whereby organizational identitychange can occur. Additionally, our findings revealed pre-viously unreported aspects of organizational change,including organization members' collective experience of"change overload" and the presence of temporal identitydiscrepancies in the emergence of the identityambiguity.*

Change is challenging. With any organizational change comeunknowns. With unknowns come ambiguities. When thoseambiguities concern the identity of the organization itself, itbecomes difficult for members to make sense of "who weare as an organization," especially when traditional referentsfor understanding that identity lose their relevance. Ambiguityabout identity is uncomfortable, at both the individual andorganizational levels, and most would like to resolve it quicklyto achieve some renewed semblance of clarity about theiridentity. For that reason, ambiguity about identity creates thecontext for its own resolution during times of change.

For many organizations undergoing identity change, theprocess is a fairly lengthy one, playing out incrementally overmany years (Albert and Whetten, 1985). Some identitychanges, however, are so sweeping and discontinuous thatthey disrupt the order of the understood world. One suchoccurrence is the spin-off of one organizational entity from itsparent. During a spin-off, issues of change and identity con-verge on a single, interrupting, and potentially profoundevent, the creation of an independent organization seeking itsown survival, growth, and success. For spin-offs, identitychange can be, and often must be, relatively rapid. Suchchanges are often accompanied by individual and collectiveapprehension associated with unknowns that are only partial-ly predictable and thus are fraught with ambiguity. Ambiguitymight be a feature of most change efforts, but when thatambiguity extends to the organization's identity, changebecomes a precarious enterprise.

In the wake of such ambiguity, resolving the "who are we?"question becomes salient. When we revise our familiar waysof describing our identity, or when our familiar ways of know-ing who we are as an organization lose their meaning or haveno meaning in new circumstances, the context for identitychange arises. Identity ambiguity implies multiple possibleinterpretations about which core features should define thechanged organization, so tensions can accompany theprocess of deciding which interpretations will prevail in shap-ing the company's future image. Attentive leaders experiencea "sensegiving" imperative (cf. Gioia and Chittipeddi, 1991}and take steps to promote collective sensemaking so they

173/Administrative Science Quarterly, 49 (2004): 173-208

can foster a renewed clarity about an altered identity (Fiol,2002). For these reasons, understanding ambiguity is pivotalto understanding organizational change, especially identitychange. All change, however, involves some process of mov-ing from an existing clarity of understanding to doubt, uncer-tainty, and/or ambiguity, and ultimately to a state of renewedclarity that resolves Into an altered form, an observation thatechoes Lewin's (1951) longstanding characterization ofchange as broadly involving the stages of "unfreezing,""moving," and "refreezing,"

The recognition that change is an important factor in the livesof organizations and their members has become so wide-spread as to lead to the creation of a variety of approachesfor examining and classifying different types of organizationalchange (e.g,, Robertson, Roberts, and Porras, 1993; Van deVen and Poole, 1995; Armenakis and Bedeian, 1999; Weickand Quinn, 1999). Although the ultimate purpose of changetypologies is usually to provide classifications for differentways that organizational change can occur, such a focus rais-es the potential for paying more attention to category defini-tions and less attention to the dynamics underlying thechange event or process itself. Albert (1992) has offered asimplified approach that encourages a focus on these impor-tant dynamics, one that begins with the recognition thatmost substantive organizational change involves either addi-tion (i.e., new units, mergers, assimilations, etc.) or subtrac-tion (elimination of units, divestitures, downsizing, etc) froma focal organization or organizational unit.

At the organizational level of analysis, even a cursory reviewof the change literature reveals a strong bias toward empiri-cal examinations of additive types of change, most oftenassociated with organizational actions around mergers, acqui-sitions, joint ventures, and strategic alliances. Even if theremight be more acquisitions than divestments, examinationsof organizational change involving subtraction, such as spin-offs, equity carve-outs, and de-mergers have been understud-ied. This paucity of research on subtractive change could besignificant because research on additive change does notnecessarily inform our understanding of subtractive change,and, in fact, might be misleading in the face of evidence thatsubtractive change can be more difficult to plan for, imple-ment, and manage than additive change (Albert, 1984, 1992),particularly if it involves a change in organizational identity.

Identity at the organizational level refers to insiders' answersto self-reflective questions about what is centra! to their orga-nization's existence, such as "Who are we as an organiza-tion?" or "Who do we want to be as an organization?"(Albert and Whetten, 1985). Although past work has providedinsight into why organizational identities change (and need tochange) over time (Elsbach and Kramer, 1996; Gioia andThomas, 1996; Gioia, Schultz, and Corley, 2000), it has notprovided adequate insight into /low organizational identitychange can occur (cf. Gioia, Schultz, and Corley, 2000; Fiol,2002). Additionally, most research on organizational identitychange has examined this phenomenon in the context ofmergers, acquisitions, and diversifications (e.g., Barney,1998) or the creation of a new division within the organiza-

174/ASQ, June 2004

Identity Ambiguity and Change

tion's boundaries (e.g., Brown and Gioia, 2002), all of whichinvolve additive changes in which conflict, tension, andpower struggles are typical and expected. We might expectdifferent processes and outcomes to surface during organiza-tional identity change in a subtractive change context, how-ever, as suggested by Ashforth and Mael (1989) and Prattand Foreman (2000), because subtractive change throws intoquestion members' understanding of "who we are as anorganization." Those who were insiders in a particular organi-zation become outsiders as the subtractive change proceeds.We know little about identity change in this context, whichprompted our guiding research question: How does organiza-tional identity change occur during a corporate spin-off?

Spin-offs represent an excellent context for examining organi-zational identity change because issues of change and identi-ty naturally arise as members attempt to position their neworganization for survival and growth. Most corporate spin-offresearch, however, has taken a decidedly financial and eco-nomic perspective (cf. Hambrick and Stucker, 1998), focusingon the profit or investment implications of the event (e.g..Miles and Woolridge, 1999), and often in relation to the finan-cial outcomes of mergers and acquisitions. We are aware ofno strong theoretically based empirical examinations of theidentity change processes associated with a spin-off or, forthat matter, of the identity change processes involved in sub-tractive organizational change. We therefore sought to pro-vide insight into the dynamics of identity change in a corpo-rate spin-off through a qualitative, interpretive study of thespin-off of a Fortune 100 firm's top-performing unit into itsown wholly independent organization.

ORGANIZATIONAL IDENTITY CHANGE

Organizational identity is the members' collective, sharedsense of who they are as an organization (Albert and Whet-ten, 1985; Stimpert, Gustafson, and Sarason, 1998). It repre-sents insiders' centra! perceptions and beliefs about whatdistinguishes their organization from others and provides thefoundation for presenting the organization to external audi-ences (Hatch and Schultz, 2002). In their original work defin-ing the concept, Albert and Whetten (1985) conceptualizedorganizational identity as those characteristics collectivelyunderstood by an organization's members to be central, dis-tinctive, and enduring. These defining aspects were presum-ably stable and resistant to ephemeral or faddish attempts atalteration because of their ties to the organization's foundingand history. Although Albert and Whetten acknowledged thatidentity could change, they also argued that change occurredslowly, over long periods of time.

Dutton and Dukerich's (1991) examination of the NewYork/New Jersey Port Authority and its attempts to adapt toenvironmental changes provided an initial, empirically ground-ed look at organizational identity's relationship with individual-level variables during times of organizational change. Theiranalysis revealed a strong relationship between organizationalidentity and how members' sense of outsiders' perceptionsof the organization (what Dutton, Dukerich, and Harquaii,1994, later referred to as "construed external image") inter-

175/ASQ, June 2004

acted to influence individual cognition and behavior, as weWas strategic organizational actions. When outsiders' percep-tions of the organization differed from insiders' perceptions,members questioned both their beliefs about who the organi-zation was and their status as members of the organization,Reger et al. (1994) advanced the link between organizationalidentity and change in observing that a fundamental changein the way an organization conducts its business, such asimplementing a total quality management (TQM) initiative,requires a fundamental change in how the organization thinksof itself, They posited that only by bringing about changes inthe organization's identity could a top management team suc-cessfully implement the radical transformations that TQM ini-tiatives required.

Empirical support for the relationship between organizationalidentity and change emerged in Gioia and Thomas's (1996}investigation of a strategic change effort at a large publicresearch university. Their findings indicated that the universi-ty's identity was not only capable of rather rapid change butthat identity was relatively fluid and malleable in adapting toenvironmental changes. Their grounded theory indicated thatthe link between identity and image, specifically, a desiredfuture image projected by the top management team,sparked the identity change and formed the basis of strategicrenewal within the university. By presenting an alternativeperspective of what the organization could be, the top man-agement team was able to destabilize current perceptions ofwho the organization was and create support for the desiredstrategic change effort. All these studies represent attemptsto accomplish a change in organization-level identity andmight be construed as attempts to achieve a macro-level ver-sion of a "possible self" (cf. Markus and Nurius, 1986). Simi-larly, Elsbach and Kramer's (1996) examination of how mem-bers of top-20 business schools responded to identity threatsimplicit in reputational rankings provided further empiricalsupport for the notion that image is important to understand-ing why identity change might occur. Their findings that insid-ers reframed the organization's identity on the basis of theperceived level of dissonance between the identity and thereputational feedback demonstrated the powerful influencethat outsiders' perceptions have on the malleability of organi-zational identity.

Building on these previous efforts, Gioia, Schultz, and Corley(2000) developed a process model of the adaptive relation-ship between organizational identity and construed externalimage. Their basic premise was that external images of theorganization trigger a comparison by insiders between organi-zational identity and construed external image. Specifically,organization members assess how they see their organiza-tion (i.e., answer such questions as "Who do we think weare?" and "Who do we think we should be?") in relation tohow they think outsiders see it (i.e., answer questions like"Who do they think we are?" and "Who do they think weshould be?"). Arising from this comparison is either a senseof discrepancy ("How we see ourselves does not match howwe think others see us") or a sense of alignment ("We seeourselves in a way that is similar to how we think they see

176/ASQ, June 2004


us"). Alignment tends to strengthen organizational identity,whereas discrepancy leads to sensemaking about how torespond to the disparity (see also Chreim, 2002; Foremanand Whetten, 2002). Consequently, identity changes asnnembers cope with the knowledge of how others view theorganization and how aligned those perceptions are with theirown.

Although these foregoing works identified reasons why anorganizational identity change occurred, they did not provideadequate insight into how identity change might occur. Gain-ing insight into the processes by which organizational identitybecomes destabilized and how that destabilization leads toalterations in identity can provide a deeper theoretical under-standing of major organizational adaptation and renewalefforts.

A key to understanding how organizational identity changecan occur is found in its dual nature: organizational identitiesconsist of both language and meanings (Gioia, Schultz, andCorley, 2000). Identity labels represent the symbolic expres-sion of how organization members collectively answer thequestion "Who are we as an organization?" Yet each identitylabel can have multiple meanings associated with it. Theidentity of an organization whose members answer the ques-tion "Who are we?" with "We are an innovative company"consists of the self-referential label "innovative" as well asthe shared meanings underlying that label {e.g., cutting-edgescientific research, industry-leading customer service, alwaysfirst to market, etc.). Thus it is possible to conceive of atleast two basic ways in which organizational identity changecan occur: (1) through a change in the labels used to expressidentity, such as a shift from describing the organization as a"computer software company" to describing it as a "technol-ogy solutions company," or (2) through a change in themeanings underlying those labels, for example, what itmeans to be a "technology solutions company" today is dif-ferent from what it meant previously. Both forms of identitychange can be adaptive for an organization {Gioia, Schultz,and Corley, 2000), but each takes on a different form depend-ing on whether change is occurring at the level of the labelsor at the level of meaning,

We have limited empirical evidence about how each type oforganizational identity change might occur or about relation-ships between labels and meaning change. Fiol's (2002)examination of an intentional identity change effort providessonne initial insight into how labels-based organizational iden-tity change can occur (see also Ashforth and Humphrey,1997, on the role of labels in organizations). Her findingshighlight the importance of managing rhetoric during planned,radical identity transformations to help members disidentifywith the old identity and identify instead with a new set ofcore beliefs. Our study expands on this insight by examiningboth planned and unplanned Identity change, thus providing abetter understanding of how meaning-based identity changecan occur and how it is related to subsequent attempts atlabels-based identity change.

177/ASQ, June 2004

The grounded model of identity change that arose from ourstudy of this spin-off revolves around a context for changedefined by a key emergent concept, identity ambiguity, a col-lective state wherein organization members found them-selves without a good sense of who they were as an inde-pendent organization during and after the spin-off or a senseof what the future held for them as an organization. The col-lective sensemaking that ensued in the wake of this identityambiguity fostered the creation of a change context in whichdefining who the new organization was and where it wasgoing became a strategic imperative for the ultimate successof the spin-off. The emergent model also provides insightinto some triggers of identity ambiguity and senior leaders'responses to the sensegiving imperative, thus providing thewherewithal to develop theory on key processes of organiza-tional identity change and their implications for organizationaladaptation.

Because we knew little about the processes of organizationalidentity change when we began this study, we chose to pur-sue our investigation inductively, relying on a qualitative,interpretive approach. Interpretive research focuses on build-ing an emergent theory from a perspective that gives voiceto the interpretations of those living an experience, in thiscase, the experience of identity change. Because most socialgroups try to maintain an aura of stability in their identity(Whetten and Godfrey, 1998: 35), observing change in organi-zational identity (and getting insiders to talk about it) can bedifficult. To aid in understanding this process, then, we need-ed to identify an organizational context in which issues ofidentity change were open and apparent and thus possiblefor insiders to acknowledge and discuss. We chose the occa-sion of an organizational spin-off for our study.

METHOD

The organization we studied was a global technology serviceprovider being spun off from its long-time Fortune 100 parentorganization, which we will call "Bozco." Changes in theindustry had produced restructurings among competing firmsand start-ups in the industry that augured for Bozco spinningoff its subunit to help both the parent and the offspring com-pete more effectively, These industry changes suggestedthat agile, independent companies were the way to go. Thespin-off company, which we call "Bozkinetic," had approxi-mately 30,000 full-time employees at the time of the restruc-turing, with 95 percent of those employees located withinthe United States. At the time of the spin-off, Bozkinetic hada seven- to nine-level hierarchy (depending on the specificpart of the organization) and a seven-member top manage-ment team consisting of five ex-Bozco executives and twooutsiders (one of whom was from outside the industry) thatwas responsible for all strategic decisions within the newcompany. As was the norm in the industry, Bozkinetic's workculture was highly virtual, with every aspect of the compa-ny's planning and operations spread across multiple geo-graphical locations, including the executive team, which wassplit between a headquarters building on the West Coast andan office on the East Coast. Travel between the two locations

178/ASQ, June 2004


was frequent, and members used video conferencing andelectronic meetings as well.

Phases in the research. Bozkinetic's path to its "Indepen-dence Day," the official term used by Bozkinetic's top man-agement team to describe the actual spin-off event, took justover 18 months from the parent's initial decision to create atracking stock for the eventual new unit to the day that itbecame a freestanding company. The path to independenceincluded the initial public offering (IPO) for the initial trackingstock, the forma! announcement of the spin-off date, and theactual spin-off event itself, which was followed by a period ofapproximately six months during which members adjusted totheir independent status. For data collection and analysis pur-poses, we broke this timeline into three distinct periods: (1)pre-spin-off, (2) spin-off, and (3) post-spin-off, as shown infigure 1.

The pre-spin-off period involved the time from the initialtracking stock announcement up to the last official and legalhurdle the organization had to clear before the spin-off couldactually occur, the IRS's final ruling declaring that the spin-offcould proceed as a tax-free restructuring. The spin-off periodfollowed this event and lasted just over one month. It beganduring a legally mandated "quiet period" with the IRS tax rul-ing, included a formally scheduled "Independence Day," andended with Bozkinetic's final "all employee spin-off meet-ing," at which the company's top managers explained toevery employee the strategic and operational details of thespin-off and outlined their vision for the company's future.These events allowed us to define the spin-off period clearly,although the processes accompanying the spin-off over-lapped the formal, methodological time boundaries. Theseformal features are quite common in spin-offs. All spin-offs,mergers, and acquisitions, for instance, have a formal startdate. The quiet period is government-mandated to ensure thecompany does not do anything to hype its own stock undulywhile investors are determining the specifics of the restruc-turing deal and pertains to any publicly traded companyengaging in a spin-off, merger, or acquisition.

Rgure 1. Timeiine of Bozkinetic's spin-off.

PRE-SPIN-OFF SPIN-OFF POST-SPIN-OFF

18 Months

Quiet Period

Entry intoOrganization

V 1 Month

Quiet Period

6 Months

f—'—^

* 1 1( " ^ Studv Observation Period

1 *Tracking StockAnnounce nnent

IPO Spin-offAnnouncement

lOffictal Spin-off''Independence

Day"IRS Tax

Ruling onSpin-off

Last All-employeeSpin-offMeeting

End-of-year

Analysts'Meeting

179/ASQ, June 2004

The post-spin-off period lasted six months, during which weintended to capture organizational implications in the wake ofthe spin-off event. This last period concluded with the year-end analysts' meeting about earnings and an all-employeeteleconference summarizing the past year's performance andview ahead for the coming year. Our entry into the organiza-tion occurred with approximately two and a half monthsremaining in the pre-spin-off period and lasted until the endof the post-spin-off period, as shown in figure 1.

Sampling

We followed Lincoln and Guba's (1985) guidelines for "pur-poseful sampling" in choosing our informants. We initiallychose informants who would be most able to inform us onour main research question concerning how organizationalidentity changes. Then we used a snowball technique, askingeach informant for his or her recommendations as to whocould best explicate the processes of interest. Past researchand our research focus suggested that sampling should beginwith top managers because they play an important role in thestrategic aspects of spin-offs. Prior research has identifiedtop managers as critical players in perceptions about changein organizations (Kiesler and Sproull, 1982; Daft and Weick,1984; Isabella, 1990). As active participants in the changesassociated with a spin-off, these managers represent keyinformants (Kumar, Stern, and Anderson, 1993) who haveimportant insight into an organization's identity, uniqueaccess to knowledge of organizational structures, strategies,and actions and are in a position to recommend additionalinformants at all levels and units within the organization. Inaddition, we employed the processes of theoretical sampling,pursuing data relevant to the themes and grounded theoryemerging from the on-going analysis, and constant compari-son of data across informants and over time (Glaser andStrauss, 1967) as integral parts of our grounded-researchprocess. The entire procedure involved an iterative processof simultaneously collecting data, analyzing the data, andseeking new informants on the basis of information deemedimportant by prior informants. This approach resulted in anevolving sample of informants and increasingly focused datarelevant to the emerging theory, until further data collectionand analysis yielded no further explication of a given categoryor theme, what Glaser and Strauss (1967) referred to as"theoretical saturation."

Data Collection

We collected data using three techniques; (1) semistructured,one-on-one interviews, (2) written and electronic documenta-tion, and (3) non-participant observation. We relied on theinterviews as the main source of data on the identity-changeprocess, with the observation and documentation data serv-ing as important triangulation and supplementary sources forunderstanding events and their presentation to various con-stituencies and discrepancies among informants and as ameans of gaining additional perspectives on key issues (Jick,1979; Miles and Huberman, 1994).

180/ASQ, June 2004


Semtstructured interviews. We conducted multiple in-depthinterviews with organization members before, during, andafter the spin-off event. To maintain consistency, the leadauthor conducted all interviews. We asked all informants tospeak as the representative voice of the collective (i,e., asthe voice of Bozkinetic), We employed semistructured inter-views at the beginning to provide as wide a scope as possi-ble for the data collection. Interviews lasted 45-90 minutes,and all initial interviews lasted at least 60 minutes. The initialinterview protocol was mostly standardized across infor-mants, with some customization for hierarchical level, busi-ness unit, and organizational tenure. These initial interviewsinvolved questions about company experience, involvementin work at Bozkinetic, thoughts about the company's histori-cal evolution and perceptions of the impending, current, orrecent spin-off, the business and strategic context of thespin-off, plans for the spin-off, and early indicators and under-standings of organizational identity and image. Subsequentinterviews became progressively more structured as themesemerged in the data. This progressive focusing of the inter-views allowed for targeted data collection in our attempts toidentify patterns across informants and consistencies andinconsistencies across the organization, as well as tentativerelations among concepts. Thus much of the content of sec-ond and third interviews with a given informant focused oncategories and themes represented in our emerging datastructure.

To minimize the possibility that the interview questions in fol-low-up interviews with the same informant might bias mem-bers' responses toward our evolving interpretations, we ledoff later interviews by identifying issues raised by other infor-mants and used terms generated by informants to framequestions, Qnly later did we raise questions to follow up onissues identified by the same informant. In addition, to helpprevent our informants from becoming sensitized to issuesof identity via our interviews, we asked questions related toidentity only after such issues were raised by the informant.Long durations (often months) between interviews alsoserved to reduce bias,

We conducted 80 interviews with 38 different informantsthroughout the organization, as detailed in table 1. We audio-recorded all but 13 of the interviews and then had the tapestranscribed verbatim. The 13 non-recorded interviews wereunscheduled interviews with key informants in which wetook detailed notes as soon after the interview as possible.The 38 different informants varied in both functional area andhierarchical level. We interviewed five of the original seven-member top management team, as well as two new execu-tives added to the team in the spin-off phase. The other 31informants ranged from senior vice-president level down tothe lower-middle of the hierarchy, positions such as humanresource trainer, local sales manager, and marketing assis-tant.

Documentation. We collected unobtrusive data through doc-uments pertaining to the spin-off (Webb and Weick, 1979),These documents took three forms: (1) identity artifacts,which included paper and electronic representations and

181/ASQ, June 2004

Table 1

Quantitative Details of the Interview Data

Informant andHierarchical Position

Chief executive officerExecutive vice-presidentExecutive vice-presidentExecutive vice-presidentExecutive vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentSenior vice-presidentVice-presidentVice-presidentVice-presidentViceiDresidentVice-presidentVice-presidentVice-presidentVice-presidentMarketing managerBusiness managerTechnology managerHuman relations managerBusiness managerSales managerBusiness managerMarketing rep.Human relations trainerCustomer agentTechnicianCustomer agentBranding agentTechnicianFinancial agentCommunications agent

Pre-spin-off

21

1112

3

11

1

1

11

Interviews in

Spin-off

121

111121111111

11

111

1

Phase:

Post-spin-off

12

21311121

11321

11

11111

2211111

1

descriptions of the organization's identity to insiders, (2)image artifacts, which included paper and electronic repre-sentations of how the company projected itself to outsidersas well as how outsiders actually perceived the organization,and (3) contextual material, which included paper and elec-tronic documents related to strategic, operational, financial,and cultural aspects of the organization, aimed mostly atinsiders. Not only did these documents (e.g., executivememos, press releases, and printouts of its Web site text)provide a secondary data source (Jick, 1979) about the orga-nization's identity and the spin-off process, but they alsoproved helpful as a tool {Forster, 1994) for engaging infor-mants in discussions of how specific identity claims andimages related to the process of identity change. Table 2 pro-vides details about the documents, including whether thesource was internal or external to the company and itsintended audience.

Observation. Finally, we engaged in direct, non-participantobservation of organizational actions, members' routines

182/ASQ, June 2004


Table 2

Quantitative Details of Documentation Data

Source / Audience Pre-spin-off

3226

400

114

m109

Study

Spin-off

2118

5635

1453

Phase

Post-spin off

2531

33830

45101

Total

7875

7815179

119272

External / external (e.g , news articles)Internal / internal (e.g., employee nnemos)Internal / external

Press releasesAdvertisementsWeb pagesExecutive speeches

SubtotalTotal

(e.g., handling of customer calls, interactive problem solvingwith coworkers), and social interactions (e.g., internal meet-ings and employee information sessions) to gather potentiallyinsightful data pertaining to personal and interpersonal issuesof identity change. These observations occurred during timespent shadowing organizational members as they went abouttheir activities. We took detailed field notes during the obser-vation and, in the process, not only captured those items ofrelevance to the research questions but also acquired usefulinformation about cultural and structural aspects of the orga-nization to aid in understanding the organizational context ofthe spin-off. Key observation events included strategic meet-ings about marketing, branding, and technology, celebrationsaround the actual spin-off event, and all-employee meetingsheld during and after the spin-off event. We constructed thenarrative of our findings from a combination of our inter-views, documents, and observational field notes.

Data Analysis

As we collected the data, we also inductively analyzed it,adhering closely to the guidelines specified for methods ofnaturalistic inquiry (Lincoln and Guba, 1985) and constantcomparison techniques (Glaser and Strauss, 1967). Theseapproaches provide the basis for rigorous collection andanalysis of qualitative data and assist in determining the sam-pling and content foci of later data collection. Additionally,they provide the basis for clearly delineating themes andaggregate dimensions (Gioia et al., 1994) through the exami-nation and comparison of key events (Isabella, 1990), as wellas ideas discussed by the informants.

We began the analysis by identifying initial concepts in thedata and grouping them into categories (open coding). Con-ceptual coding used in-vivo (Strauss and Corbin, 1990) or firstorder (Van Maanen, 1979) codes (i.e., language used by theinformants) whenever possible, or a simple descriptivephrase when an in-vivo code was not available. Next, weengaged in axial coding, wherein we searched for relation-ships between and among these categories, which facilitatedassembling them into higher-order themes. Finally, we gath-ered similar themes into several overarching dimensions thatmake up the basis of the emergent framework. These tech-niques were not linear but, instead, formed a "recursive.

183/ASQ, June 2004

process-oriented, analytic procedure" (Locke, 1996: 240) thatcontinued until we had a clear grasp of the emerging theoret-ical relationships and additional interviews failed to revealnew data relationships. The final data structure is illustratedin figure 2, which summarizes the second-order themes onwhich we built our model of identity change.

Trustworthiness of the data. Following Lincoln and Guba(1985), we took several steps to ensure the trustworthinessof our data. First, we meticulously managed our data, includ-ing contact records, interview transcripts, field notes, anddocuments, as they were collected, using a computer-basedqualitative data management program. Second, we used peerdebriefing, which entails the field researcher engaging otherresearchers not involved in the study to discuss emergingpatterns in the data, to serve as a sounding board for evolv-ing propositions, and to solicit critical questions about thedata collection and analysis procedures. It is a means for thefield researcher to vet his or her ideas through anotherresearcher to gain an outsider's perspective. In this study, thepeers were department members as well as another qualita-tive researcher at another school. Finally, we asked an experi-enced qualitative researcher familiar with the grounded pro-

Figure 2. Data structure,

1st Order Concepts 2nd Order Themes

• Loss of parent company as direct (internal) comparison• Shift in focus to comparisons with competitors• Media attention shifts away from Bozco to industry

Change inSocial Referents

' Who we are going to be? / How will we see ourselves?• This is what independence means" How do we get there from here?

Temporal IdentityDiscrepancies

' Misperceptions / false data reported in the media" Quiet periods constrain our internal communications* Stock price does not adequately reflect who we are" Customers don't know we're independent

• We don't even know who we are right now* Understand the labels, but what do they mean?• Sense of missed opportunity around the spin-off* No consistency in labels during pre-spin-off and spin-off

' Growing sense of change overload" Emerging identity tensions

• Shift from "independent" and "innovative" to "doingthe right thing"

• Providing more to work life than just a paycheck• Proactive management of internal and external

perceptions

' Using branding efforts to change external perceptions• Branding efforts can help employees with disconnects

Behaviors more influential than words"Walking the talk"

ConstruedExternal ImageDiscrepancies

IdentityAmbiguity

SensegivingImperative

Refined DesiredFuture Image

IncreasedBranding Efforts

ModelingBehaviors

AggregateDimensions

Triggers ofIdentity

Ambiguity

LeadersResponsesto Sense-

184/ASQ, June 2004

Identitv Ambiguity and Change

cedures we followed to conduct an audit of our empiricalprocesses and products to help gain a sense of the depend-ability of our data. This researcher went through our fieldnotes, interview protocols, coding schemes, and randomsamples of interview transcripts and documentation toassess whether the conclusions we reached were plausible.

IDENTITY CHANGE AT BOZKINETIC

As illustrated in figure 3, there are three main dimensions tothe model of identity change that emerged from Bozkinetic'sexperience; (1) triggers of identity ambiguity, (2) the identitychange context itself, and (3) leaders' responses to thesensegiving imperative. To better understand why each ofthese aggregate dimensions and their constitutive themesemerged, it is important to gain a sense of Bozkinetic's orga-nizational identity as it existed prior to the spin-off period.

Figure 3. Organizational identity change process.

Pre

-Spi

n-of

f Id

entit

y

TRIGGERS OFIDENTITY

AMBIGUITY IDENTITY CHANGECONTEXT

LEADERS-RESPONSES TOSENSEGfVINGIMPERATiyE

SocialReferentChange

TemporalIdentitv

Discrepancies

ConstruedExternal ImageDiscrepancies

Label S( MeaningConfusion Void

Change & IdentityOverload Tensions

RefinedDesired

Future Image

IncreasedBranding

Efforts

ModelingBehaviors

Pre-spin-off Identity

We were able to gain entry into Bozkinetic far enough Inadvance of the actual spin-off event to capture a sense of theorganization's identity before any formal changes occurred.Early entry enabled us to develop a basis for comparison withfuture data on the organization's identity during and after thespin-off. Prior to the spin-off, the organizational identity of theBozkinetic unit within Bozco was clear, heavily rooted insocial comparison, and often took the tone of "not likethem." In response to questions relating to "Who are we asan organization?" most answers involved how Bozkineticwas not like Bozco. Aspects of the pre-spin-off identityincluded such claims as "We are an innovative companycompared to [Bozco]," and "We are a younger, more agilecompetitor than [Bozco]." Yet, as a senior vice-president (VP)told us, Bozkinetic's identity also clearly involved the notionof dependence: "We are dependent on their strategies andtheir financial goals, so our capital spending and how fast wecan grow are all constrained by the larger goals of [Bozco].We are just so subservient to [them] in so many ways."

185/ASQ, June 2004

Other, non-comparison-based identity claims surfaced in ourearly interviews as well, including references to Bozkinetic'spreferred view of itself as "an industry founder," "an aggres-sive competitor," "a ground-breaking marketer," and as being"a reliable and safe choice" within the industry, althoughthese claims usually arose only after an informant providedidentity claims based on a Bozco comparison. Regardless ofthe specific aspect of identity mentioned, however, membersheld what can be termed "identity clarity." As a businessmanager explained to us early on, "We know exactly who weare—we are a young, aggressive, savvy company, somewhatin the dot-com mode, but at the same time we have the size,the resources, and the talent to succeed in the marketplaceand do it all , . . that's all pretty clear to us."

Members seemed quite sure of the meanings associatedwith their identity labels and what those meanings meant inregard to the company's positioning in its market space: Boz-kinetic was a great unit in which to work and a strong com-petitor in its marketplace, and this was most evident in com-parison with Bozco. Internally and externally focuseddocuments also reflected these underlying meanings, usingBozkinetic's place near the top of Bozco's divisions in finan-cial performance as a morale booster for employees and apositive projected image for outsiders. Bozkinetic memberssaw this shared clarity about their identity as an asset in theirupcoming split from Bozco,

As Bozkinetic became more accustomed to the idea of itscoming independence, however, and the realization emergedamong members about how different things would be as anindependent company, our data analysis began to reveal sub-tle shifts in thinking about who the organization was and,more importantly, where it was going. As a marketing direc-tor told us, "I think it's still formative. It's unclear what weare going to be to a lot of people in the management ranks. . . for most employees, they don't see it or hear it or can'ttouch it or feel it yet," Although most employees did not seenotable changes in their day-to-day jobs or in their reportingor working relationships, they did begin to notice and com-ment on changes in perceptions about—and a confusingarray of images, labels, and rhetoric around—"who theywere going to be" (i,e., their desired future image) as anindependent company. For instance, much of the earlyrhetoric about the spin-off involved the belief that being inde-pendent would allow Bozkinetic to show off its true techno-logical talents in the marketplace:

. . . and we are going to work together to make IBozkinetic! the #1company in the defining Itechnology] industry of the 21st century,(Chief executive officer's memo to employees just before the spin-off)

Today's demonstration reinforces our commitment to be a leader inthe Itechnologyl field and to continue to bring new [technoiogy]advances to the marketplace. (Statement from the senior VP oftechnology in an internal memo and reflected in an external pressrelease)

186/ASQ, June 2004

Identitv Ambiguity and Change

There's a sense that splitting off is going to make us more technical-ly advanced. I think it's definitely something that we're hoping forand I think we are on the edge of that. But is that really us? Eitherwe're going to find out that we are a technologically advanced com-pany capable of innovating or not. And we're going to find that outfairly quickly, (HR manager)

The dominant theme to emerge from our comparisons ofBozkinetic's pre-spin-off identity with its spin-off and post-spin-off identity claims reflected a growing sense of identityambiguity among members about what it meant to be Bozki-netic. The emergence of identity ambiguity, its rising intensityprior to and during the spin-off period, and its subsequentremission all signaled transitions: from identity clarity toambiguity and then to a renewed (albeit altered) clarity overthe duration of our study. The dynamics of this ambiguityoverlapped the three phases of the spin-off, as shown in fig-ure 4, Most importantly, the prevalence of identity ambiguity,and the subsequent sensegiving imperative to resolve it, con-stituted the key elements of Bozkinetic's subtle but powerfulchange context, the triggers of which constituted a constella-tion of differing social, temporal, and external referents.

Figure 4. Mapping of emergent themes onto spin-off phases.

Quiet Period Quiet Period

Pre-spin-off Spin-off Post-spin-off

Triggers of

.eaders' Responses tonsegiving imperative

Triggers of Identity Annbiguity

Three specific themes relating to the origins of the identityambiguity characterized our informants* experiences: (1)changes in social referents, (2) temporal identity discrepan-cies, and (3) construed external image discrepancies. In thisfindings presentation, we have coordinated and integratedfour data displays—the findings narrative itself, figure 2,showing the progressive data structure, figure 3, showingthe emergent model, and table 3, showing additional support-ing data—so the interested reader can discern and "quadran-gulate" the evidence for our findings.

Change in social referents. The first trigger of identity ambi-guity involved a natural consequence of the spin-off itself, theloss of Bozco as a social referent. In terms of organizationalidentity, social referents are other companies that organiza-tion members use as a comparison to help them determinewho they are as a company. Since the creation of the Bozki-

187/ASQ, June 2004

Table 3

Data Supporting Interpretations of Identity Change Processes

Theme Representative Quotations

Triggers of identity change

Social referent change

Tennporal identitydiscrepancies

Construed externalimage discrepancies

•| think that instead of getting hung up on the fact that you want to be different than (Bozco)you are supposed to be differentiating yourself from your competition. Who cares if youare different from (Bozco)?" (executive VP).

"1 think there's been a lot of emphasis on differentiating us from (Bozco) that in my view isunnecessary and wasted energy" (new sales manager).

"When we do compare ourselves to (competitor A} for example, it's not as pretty as con>paring ourselves to (Bozco). Also, there's a lot less certainty around those comparisons. Itwas easier to know what was going on inside (Bozco). You have no idea what's going oninside of (competitor A). All you see is the results and maybe they are dying somewhereelse because of this, but it's not evident yet" (senior VP).

"How will we get there from here?" (business manager)."I don't necessarily see how we are going to get there, or what we are doing right now, to

lead us to this vision that supposedly is guiding us. There is ambiguity as well in the senseof what's realty going on. Do we have a good future? Is it stable?" (technology manager).

"Suddenly some people have to remember what it's like to be an independent company.Even for some of the (original venture) people who are still here, they weren't in seniorenough positions then to really know what it means and others are just r>ot sure what itmeans to begin with. So now we are going through this growth cycle and there is goingto be some ruffled feathers, because we don't necessarily have all the skills we need"(executive VP).

"I don't think they totally understand what it is we are and what it is we have. I think theyare undervaluing what we have. For example, our stock price isn't even close to beinglinked to our performance" (communication manager).

"We see ourselves in the corporate space as the market leader—but that's not how we'reviewed out there" (VP).

"There's a lot of things that we don't say or we don't even rebut. We also are just a compa-ny that doesn't give out info; we don't put out as many press releases as some others. SoI feel that our name and what we're doing isn't always out as much as some of our com-petitors" (VP).

Identity change context

Identity ambiguity "We just don't know who we are right now" (business manager)."No one is stepping up to display behaviors that will help define who we are; they're not

even taking the time to explain things to us" (human relations trainer)." I think it's unclear what we are to a lot of people who are in the management ranks" (senior

VPt."You almost have this cognitive dissonance where you are trying to say you were different

but you really weren't that different. So maybe it's better to accept who you are and try tobe the best at that, than to try and really totally change. But we are different; it just doesn'tseem like it. It can all get very confusing" (business manager}.

"I think six months after the spin we will have a little bit more of a self-identity that's not asfocused on (Bozco) . . . we currently have some things that are considered [Bozcol stuffand I hope there's going to be a better understanding of who we're trying to be" (com-munications manager).

"I think most employees basically are still wanting more clarification around who we are"(VP).

"Because we did go through so many years when we were part of [Bozcol and there werealmost like two identities. Now it's kind of like 'Who are we?'" |VP).

'The effort for a lot of last year was focused on the split, and then I think we've been kindof low profile since. So I think we really need to ratchet that up and really position our-selves internally" (executive VP).

"Many parts of the organization, especially in the non-managerial ranks, have had no expo-sure to what we're going to be doing because they were being told to focus on runningthe business today and not worrying about tomorrow, so this is all a mystery to them.We've got to get them up to speed somehow because otherwise this uncertainty Is onlygoing to grow" (senior VP).

Change overload "As things change, you know, it's a vary different environment to work in and our strategieschange and so that changes priorities and depending on if we have to be reactive to some-thing in the marketplace, that might change something and It just gets to you after awhile"(human relations manager).

(Continued on next page)

Sensegiving imperative

188/ASa June 2004

Table 3 (Continued)

tdentity Ambiguity and Change

Theme Representative Quotations

"There are all these changes going on, just change after change. Almost the sense thatthere's no end to it all: change is just going to become a part of who we are, I mean, Ialmost expect a reorganization of some sort every six months from here on out and that'sjust too much for us to handle" (technician).

Identity tension "So (the analytical focus) has caused more attention to be put onto the enterprise side of thebusiness. I slill think that when you look at the weight of the resources and when you lookat how decisions are made, it's still very consumer centric, but the balance is shifting a lit-tle bit and there's anxiety about that" (sales manager).

"And yet with Imajor tech initiativel now coming aiong, these issues could replicate all over.You know, that same struggle, even down in the trenches where I think that people alreadyhave the sense that it's [technology X] versus [technology Y]" (technology director).

Leaders' responses to sensegiving imperative

Refine the desiredfuture image

Branding efforts

Modeling behaviors

"What do we tell our employees? Well, we have to tell them they are part of a great com-pany But more than that, I now understand, is that we've got to find that emotional attach-ment for who we are" (CEO).

"There will be more of a focus I believe long term on the need of employees to fee! that theyare part of something that does good as opposed to just turning up to work everyday. Sohow do you do that? Well, it just reinforces the importance of having a clear visiori and amission and strategy that they buy into, and having the communications to spread thatimage" (executive VP).

'To be honest with you, I don't know that I have them worked out, but I think it has to bearound what do we stand for? What is our strategy and what is theif foie in it? We kind ofhave our strategy down, but I think we need to tweak it more so that it is a dashboard kindof message that has meaning" (executive VP).

"We do have the brand to worry about. We market it under the |Bo2co| brand. It's not purecharity on our part" (executive VP).

"There's a real return from [the brand). People in the industry think its pretty sustainable tobe an American, familiar, trustworthy brand. There's a lot of value in the brand" (executiveVP).

"The [Bozcol brand does not test as powerfully with them (young people). We still do haveto really figure out better ways to get connected to youth" (executive VP).

"Our branding efforts will also impact employees. I think you want what you are saying inter-nally to match what they are saying about you externally unless it's not truly externallyobvious. But I think if you're very consistent in what you are saying you're much better off.I think what (our) employees saw was this unbelievably negative stuff and then it doesn'tmatch up with what they might have been told internally, and you just get a major discon-nect and then you sort of spread a lack of trust. We want to correct that with this effort"(executive VP).

"You can say you want to be known as a decisive company all you like, and put it on a tentcard, or you can actually be decisive" (executive VP).

"You can tell them what's important and what you think is important in as far as how we treatcustomers, I think as long as we the leadership team makes sure we've got the linkage,so that the way these people do their job is linked into supporting (the vision), then that'sthe thing that's really important more than somebody memorizing what the (vision) is. It'sreally how do they see it enacted?" (executive VP).

"How do they see us walk the talk?" (executive VP).t"So you're starting to see much more of a connectior} between the present and the

future?"} "Absolutely. I thought it before because I was confident that they would do it,but I'm even more so now that they've proven they can do it. So it's less based in faithand more based in action and behavior now" (marketing representative).

netic unit within Bozco some seven years earlier, Bozkineticmembers had a convenient, and mostly positive, comparisonpoint that lent identity clarity: Bo2co. Even when the compari-son was not necessarily a positive one, it was still relativelyeasy for Bozkinetic members to derive meaning about whothey were as long as they could point to Bozco and sayeither "we are like them," or "we are not like them."

189/ASQ, June 2004

After the spin-off, this comparison was no longer easily avail-able. Employees could no longer use Bozco as a point of ref-erence for describing aspects of their identity or for trying tounderstand what a particular change meant to the company.As the chief executive officer (CEO) put it, "We can't hidebehind their difficulties anymore." And this loss of social ref-erence was reinforced in the media as the business pressstopped comparing the two, as they had in prior referencesto Bozkinetic as the "darling of [Bozco's] divisions" or thepart of Bozco "that was doing well." Bozkinetic simplybecame another one of many technology service companiesin America and around the world. Bozkinetic's members, as asales manager noted, accepted this change in referentssomewhat reluctantly: "I think you really should be focusedon differentiating yourself from your competition and IBozco]is not our competition, it's our ex-parent. But people have ahard time giving it up, even though it doesn't work any-more." Finally, in the period immediately following the spin-off event, no apparent replacement referent emerged amongBozkinetic's competitors; internal documents and mediareports referred to different companies when it was conve-nient, but none provided as strong a social referent as Bozco,which produced some "independence anxiety."

One contributing factor that hurt Bozkinetic's ability to estab-lish new referents was the decision to retain the company'sname and brand, both of which were closely associated withthe parent. This was not an easy decision for top manage-ment, and not one that necessarily went over well with allmembers of the organization. Top executives, however, feltthe current brand had too much equity and that the costs ofestablishing a new brand were prohibitive, given Bozkinetic'simpending independent status. This decision led some out-siders who were less knowledgeable about the spin-off (e.g.,customers) to continue to associate Bozkinetic with Bozco,which made it harder for insiders to break away from thosecomparisons and establish new referents.

Temporal identity discrepancies. Temporal identity discrep-ancies represent instances in which members recognized aninconsistency between their organization's current identityand claims of what it would be or what members would likeit to be in the future. Thus temporal identity discrepanciesarose for members of Bozkinetic as they tried to cope withwho they knew the organization currently was versus expec-tations (expressed and implied) for the spin-off and percep-tions of who the organization would be after the spin-off. Asone executive VP indicated, there was some apprehension:"We're excited about being our own separate company. But Ithink, and I hear this echoed a lot, that we feel we need tobe more nimble and aggressive and organized more efficient-ly to be who we want to be. It's just a matter of figuring outhow to be that from where we are now."

One of the earliest examples of temporal identity discrepancyas an important concept arose in the interview data andinvolved what it meant to be an independent company.Although the enticing image of being independent from theparent had been motivating for many employees since thespin-off announcement, post-spin-off reality was more sober-

igO/ASQ, June 2004


ing. Some informants discussed how the company wasalready receiving increased scrutiny of its finances and opera-tions from the outside and how parts of the business pressseemed unwilling to grant them a "honeymoon" period,which was disheartening. Others talked about how there wasno real internal sense of what it meant to be independent,because so many of the top managers were from Bozco andhad never led a newly independent company before. Still oth-ers struggled with the uninspiring realization that, as an HRtrainer put it, "everything has changed for us as a company"and yet "I'm still doing the same thing I used to do, with thesame people I used to do it with."

Perhaps the strongest form of temporal identity discrepancyexpressed in the interviews involved members' comparisonsbetween their own perceptions of Bozkinetic and descrip-tions they heard from top management about who the com-pany was becoming. As with many organizational restructur-ings, the official rhetoric surrounding the spin-off was intenseand had mostly positive overtones. Expectations were highfor being an independent company, even though senior lead-ership was careful to include "reality checks" in most state-ments, such as "We have a long road ahead of us," and"There's still a lot of work that needs to be done before weget there." Temporal discrepancies arose not because peoplebelieved the future images were undesirable but rather,because of subtle doubt about whether the company couldactually achieve those visions. That doubt arose in interviewsas employees frequently concluded their thoughts about thefuture with comments such as "But what does that actuallymean for us?" "Can we actually become that?" An appre-hensive business manager put it this way: "I think things aregoing to be great three years from now, but we've got to getthere and I don't see how yet." Some even talked about thepossibility of a future merger or acquisition radically changingthe company's direction, leading to a void in meaning aboutthe coming transition. The lack of meaning underlying thedesired future identity claims helped members recognize dis-crepancies between the current identity and images of thedesired future identity, triggering feelings of identity ambigui-ty and eventually helping to reinforce and sustain the identityambiguity over time.

Construed external image discrepancies. The identityambiguity was also triggered by incongruities between howmembers saw their organization (i.e., their organizationalidentity) and their perceptions of how outsiders saw theirorganization (i,e., their construed external Image). Many Boz-kinetic employees believed the spin-off was a positive eventfor the company, that the company was headed in the rightdirection, and that the company was in a strong position tobe a leader in the technology economy. Unfortunately, thisdid not always correspond with what they heard from thebusiness media, the stock market, or even their customers. Itwas frequent in interviews to hear employees explain howthey believed the media misrepresented the company andsometimes even reported inaccurate information in variousarticles and columns. A senior VP complained, "Oh, we'retreated extremely poorly in the media. If you read Business

191/ASQ, June 2004

Week. I mean they just beat us up whenever they get thechance!"

Employees also expressed their belief that the spin-off didnot receive as much attention as it should have and that thecompany was not given its due as the technology/marketingleader they thought it was. These feelings of misunderstand-ing were also evident in their perceptions of industry ana-lysts, most often reflected in the dropping stock price. Asone informant explained, "They often drop your stock pricewhen they don't think you have strong management and it'spretty obvious we do." Concurrently, many felt that the lackof knowledge customers had of their independence fromBozco was also negatively affecting external perceptions, thefavorite story being one of a family member who continuedto ask questions about services no longer supported by Boz-kinetic. One VP complained, "I see things written all the timethat are false!" Yet, as a senior VP acknowledged, "We arevery poor in terms of media response."

Discussion about discrepancies in the construed externalimage often included dissatisfaction with the company'sefforts at external communication (marketing, public rela-tions. Investor relations, etc.), which further heightenedemployees' ambiguity about who the company was and whoit was becoming. Unfortunately, one of the direct conse-quences of the spin-off was an external regulatory constrainton Bozkinetic's ability to communicate with key stakeholdersin the form of the government-mandated "quiet period" untilthe financial and equity aspects of the spin-off were com-pletely settled. Because Bozco had issued a tracking stockfor Bozkinetic prior to the spin-off announcement, all employ-ees received shares in the company, which made themstockholders and, thus, targets of the quiet period. As aresult, Bozkinetic found itself in the difficult position of noteven being able to communicate with its own employeesabout future announcements, breakthroughs, and strategicmoves, a condition informants described as severely limitingthe company's ability to manage the meanings underlyingidentity claims and counteract discrepant external feedback.As one VP said:

It will be very nice to be out of the quiet period. One of things that'sbeen hard with the quiet period is that, because they're sharehold-ers, we've been able to do a lot less employee communication thanwe normally would have, which has been frustrating to employees.It's been frustrating to the leadership team too.

These perceptual discrepancies and the company's inabilityto counteract them effectively served to weaken and obscureemployees' sense of who the company was and where itwas going. Even though they firmly believed that the compa-ny was better off being independent from the parent and thatit was better than it was externally portrayed, the mountingfeedback still undermined their confidence that the companycould actually be something that the outside world did notsee it as being. This emergent sense of ambiguity about whothe company was, and who it was going to be, served as thefoundation for Bozkinetic's identity change context.

192/ASQ, June 2004


Identity Change Context

Identity ambiguity. Identity ambiguity, a central theme in theidentity change process, first began to emerge in the latterdays of the pre-spin-off period as informants talked about thestruggles they were facing as part of the spin-off process.Across all informants, some sense of "We're not sure whowe are right now and we need to figure it out soon" usuallyemerged. As one VP put it, "That [Bozco-related] identityshould be gone with the spin, should be totally wiped out.We had an old identity, so do we revert to that? Who wasthat? Is there something new? If so, make it easy for me toknow." This ambiguity was also evident In internal and exter-nal documents (memos, intranet web pages, public relationsnotices, speeches) released during those periods, as well asin observations of meetings and social gatherings as mem-bers struggled to define who they were as a newly indepen-dent company. A clear example of such ambiguity came dur-ing the spin-off period when there was inconsistency in theofficial labels used to describe the company: organizationalstatements about the spin-off sometimes focused on the"safety and reliability" demonstrated in the past, while otherstatements focused on the significance of "breaking away"and the "innovation" demonstrated as the first truly indepen-dent company in the industry. Senior leaders also waffled onthe meaning underlying various identity labels in statementsto analysts. For instance, depending on feedback receivedfrom the market, sometimes they described the label "pre-mier service provider" as connoting "the first to market withnew pricing models" (executive VP) and other times as hav-ing "the most reliable customer service" (VP). Adding to theambiguity were mixed interpretations of the meanings oflabels by employees, such as a marketing representative'sdescription of "premier" as "always coming out with the lat-est and greatest, staying on the bleeding edge of what is outthere," a sales manager's view as "invoking notions of quali-ty in whatever we do," and, finally, a technology manager'sbelief that "premier would be a size thing for most people,you know, the biggest market share, the most revenues, thelargest number of employees."

Our interviews with executives and managers also captureda rising sense of identity ambiguity as the transition to inde-pendence approached. A senior VP commented, "I think ifwe had handled the [preparation for] spin-off better, thensome of the ambiguity that's out there would probably not bean issue." Informants indicated that there were a number oflabels used internally to describe the company (both oral andwritten), but they were not sure of the meanings of thoselabels or how they applied to who the company was becom-ing, As one VP told us, " . . . even my own direct reportswould say they haven't heard anything about the meaningsof those descriptions since the spin." Examples of theseinternal labels (identity claims) included "the largest indepen-dent [technology] company," "the [technology] company withthe strongest management team," and "the most financiallysound company in the industry," all claims that informantsfound to be pretty mundane and, therefore, failed to seemuch significance in. Perhaps most importantly, thesedescriptors did not help them define what it meant to be the

193/ASQ, June 2004

new Bozkinetic, As one informant put it, "I've heard a lot ofnew ways to describe us, but they don't mean much now."Also included in this theme were statements about the spin-off as a "missed opportunity" for the company to defineitself, a category supported by informants who indirectly (andretrospectively) blamed their ambiguity about the company'sidentity on the lack of internal spin-off communication to helpthem define the company. A new executive VP lamented that"there was an opportunity to drive deeper and do more of aninteractive, participative kind of approach. We missed it, sonow it is what it is."

In an apparent attempt to allay the burgeoning concerns andspecify some putative core elements of identity, the execu-tive team did issue what it termed the company's "Corner-stones," which included vision, mission, strategy, and com-mitments statements, going so far as to print up"Independence Day" flyers explaining these cornerstonesand wallet-sized cards containing the four cornerstone state-ments. This effort, however, did not seem to have thedesired short-term effect on employees, as most peopleinterviewed did not find much meaning in the statements. Asa customer agent remarked, "How is this supposed to helpme understand what is going on?" And apparently employ-ees forgot about the statements after they did not result inobvious changes to everyday behavior and operations.

Sensegiving imperative. As might be expected, the exis-tence of identity ambiguity in Bozkinetic had an effect on theorganization's internal processes and external interactions. Astime passed and the ambiguity became more pronouncedand recognizable, a sense of urgency began to build thatdefinitive action was needed to deal with it. An executive VPreflected that urgency: "What I have my team working oninternally is a plan that really looks at what the strategy is andthe vision, so we can try to develop a kind of multimediaapproach to what it means for the individual. This is reallyimportant right now and we've got to get on it." As we dugdeeper into this sensegiving imperative (cf. Gioia and Chitti-peddi, 1991), so labeled because managers talked about fill-ing in the void with appropriate meanings, we found that twocritical concepts provided an illustration of this imperative:change overload and identity tensions.

Change overioad. We found that the many changes takingplace, both planned and unexpected, were causing anincreasing overload among employees, akin to but differentfrom the notion of information overload. In addition to thenormal business-related changes associated with a rapidlychanging and highly turbulent competitive environment (e.g.,shifting technologies, changing customer desires, tighteningprofit margins), Bozkinetic was also dealing with structuraland cultural changes related to its breaking away from Bozco.The sense of overload developed as members attempted tojuggle their usual responsibilities with additional assignmentsto cross-functional teams, planning committees, and changeimplementation teams, along with adjusting to the new pro-cedures, policies, and structures implemented to turn thecompany into a fully functioning independent business entity.These change-overload effects were prevalent and noted by

194/ASQ, June 2004


virtually all informants in the weeks following the spin-off,including the CEO in a memo to employees: "Many of yousaid that as we put all of our effort into reducing customerlosses, making the transition to [a new technology], andbuilding a cost culture, that you are being pulled in too manydifferent directions. We recognize that."

Others were less diplomatic, such as a weary HR managerwho simply said to us, "It can't go on like this for muchlonger." The presence of identity ambiguity only exacerbatedthese feelings of overload because it was more difficult tocommit to and identify with the changes, not to mention theaccompanying increases in work, without a clear sense ofwho the company was, where it was going, and what allthese additional activities meant in relation to the new identi-ty. Employees were also less motivated to "go the extramile" for their company. As one sales manager explained, "IfI knew why this mattered so much, I might care more." Fur-thermore, internal perceptions were more easily swayed byexternal feedback, which often was not positive and tendedto have a strong effect on internal identity-discrepancy per-ceptions, which caused even more questioning of why all thechanges were necessary. These ambiguity-fed feelings ofchange overload were consistently mentioned as a manifes-tation of the growing sensegiving imperative felt throughoutBozkinetic and were instrumental in the push toward achiev-ing some new sense of identity clarity.

Emergence of identity tensions. Subtle tensions began toform as multiple views about who the company was becom-ing competed for preeminence among employees. This ten-sion was exacerbated by the growing recognition of theincreasingly dysfunctional and uncomfortable ambiguity about"who we are and who we're going to be," thus providing thepolitical grounds for different parties to try to gain control ofmembers' perceptions. A technical manager captured thespirit of the feeling by noting that "we're definitely schizo-phrenic right now, and I don't know any way around it, butwe have to do something soon."

The fault lines of this evolving friction were most evident andtelling in two emergent tensions involving different aspectsof Bozkinetic's identity: (1) a continuing tension betweenaspects of the business focused on two different customergroups, one representative of Bozco's primary focus and theother more associated with Bozkinetic's new industry, and (2)a growing and potentially destructive tension between twodifferent technology paradigms at the core of Bozkinetic'sproducts and services, one old and the other new. One obvi-ous tendency in a spin-off is to focus heavily on the future,not only because the new company wants to impress on oth-ers its belief in a positive, future-oriented outlook but alsobecause it helps distinguish the new company from its par-ent and its newly focused competitor set. Thus the desire foran increased focus on new customer areas and future tech-nologies was understandable because it helped Bozkineticstrengthen its desired image as an "innovator" and "technol-ogy leader." But it also led to internal perceptions that oldcustomers and past technologies (both of which signified thepast identity claims of "reliable and safe," "conservative,"

195/ASQ, June 2004

and "industry founder") were being downplayed, eventhough people recognized that the company could notbecome a leader in the new technology and customer areaswithout continuing to excel in the old areas. A technologymanager put it succinctly: ", . . we've got to put the infra-structure in place to handle the large ramp-up that's expectednext year for Itechnology Y], At the same time, we got mostof our customers still using Itechnology X]. We can't take oureyes off of that because that's where the money is comingfrom right now," The resulting confusion fed the meanings-based identity ambiguity and heightened the emerging imper-ative to deal with the ambiguity quickly. An executive VP cap-tured these tensions between the old and the new with anapparently minor but revealing example;

The only reason that thing la long-used internal satisfaction survey]was postponed is that we needed to modify it and ask, "Does thisfit with who we are becoming?" But people are pretty jumpy aboutchanges to what we've done in the past right novw, so that was whythere was such a firestorm. If something's not done soon, though,it's only going to get worse.

We refer to these as identity-based tensions and not identityconflicts themselves because neither of these reached thestage of actually taking on the designation of an "identityclaim" (Glynn, 2000). The official rhetoric surrounding thecompany's identity never included any of these tensions;instead, these tensions were visible only in areas symbolic ofan organization's identity, such as its structure, its businessprocesses, and in its resource allocation decisions (Albert andWhetten, 1985; Fiol, 2002), In this way, they were evident formembers to see and experience, but they had not yetreached the status of (or been used by someone as) a claimof "who we are as an organization," It was clear, however,that if these tensions were not managed properly, theywould form the foundation of an identity conflict filling thevoid created by the identity ambiguity. As these strongthemes of identity ambiguity and sensegiving imperativebegan to gain prominence in the data, we recognized theneed to better understand the outcomes of this change con-text. We therefore began asking informants about and codingdocuments for data related to how they responded to thesensegiving imperative that grew out of the identityambiguity.

Leaders' Responses to the Sensegiving Imperative

Even though senior leaders began seriously addressing thesensegiving imperative relatively late in our data collection,three themes still emerged that provided insight into the for-mal organizational responses to the identity ambiguity, asshown in table 3. Each theme, (1) refinement of the desiredfuture image, (2) increased branding efforts, and (3) modelingbehaviors associated with the desired future image, repre-sented a purposeful attempt by top management to provideeither new labels for describing the company or the desired,new meanings underlying those labels. For example, anexecutive VP identified the meaning void when he noted,"It's pretty simple to say, 'we're the best [technology ser-vices] company in North America.' That's pretty focused, but

196/A5Q, June 2004

Identity Ambigu'itv and Change

I'm not sure everybody could repeat that back to you or evenunderstand what it means to them." These efforts eventuallybegan to produce the desired transition toward greater identi-ty clarity later in the post-spin-off period.

Refine the desired future image. As top managers lookedfor a more meaningful future image to inspire employees,they used the worsening economy and increased instabilityin the world as a rationale for trying to get employees tofocus on Bozkinetic as a source of significance and stability intheir lives. They believed that by getting employees to buyinto an image of the company as "something special" that"did the right thing regardless of cost," they could provide ameaningful sense of unity to replace the ambiguity presentafter the spin-off. According to the CEO:

Being financially sound is not good enough, and neither was beingthe most competitive. Neither was being the most innovative. Nei-ther was being an independent, fast-moving company. It doesn'twork. What counts is being the most caring company that deliversto its customers. Everybody knows what that is viscerally. The (peo-ple here] want to be winners. They want to be innovative winners,but I mistook that. I mistook that for the thing that drives themmost, putting humanity and values and caring underneath it.

In the end, the CEO cast the desired future image in telling,comparative terms by saying simply, "I want us to be differ-ent from IBozcol. I want us to be 180 degrees different fromthe IBozcol of now, but 1 want the values, character, and treat-ment of the technology for people to be like [Bozco] 1958."Subsequent communication and action by top managementteam members, in the form of modified and increased brand-ing efforts as well as modeling behaviors that better repre-sented the desired new identity, began to emphasize the"values," "caring," and "technology-for-people" themes thathoned Bozkinetic's desired future image.

Branding efforts, increased branding efforts also represent-ed a significant effort to actively manage impressions, direct-ly for external audiences and indirectly for insiders. The topmanagement team believed that an increased brand pres-ence reflecting their new desired image would help. As theCEO framed it,

, . . that's what we are working through with [our new brandingagency]. How do you express yourself as the stewards of this tech-nology? As the one who is most likely, because of our brand andour innovation, to bring it to life? To make people more secure, andmore comforted, and more assured, and more productive?

The most delicate issue had to do with the fact that Bozkinet-ic retained Bozco's brand name, which had some clearupsides but also some problematic downsides, including neg-ative perceptions held by analysts and customers. Seniorleaders were torn, in that "We are mindful of the brand anddon't want to hurt the brand," but they also saw themselvesas victims of the "baggage from Bozco" (a senior VP). Unfor-tunately, the desirability of the brand depended on the audi-ence for the brand image. The CEO explained, "This is com-plicated! Our name is still related to [Bozco], IThe media] stillreport our results in the same story that they report that

197/ASQ, June 2004

wholly separate imploding company called [8o2co]. . . . In themarket we want to use that brand. In the investment com-munity we want to separate ourselves from that brand." Forthat reason, senior managers took actions to begin distancingthemselves from Bozco in the business press, while capitaliz-ing on the brand appeal to enter new market segments.Branding consumed a major portion of top managers' timeduring the post-spin-off period because they deemed it to bean important means of communicating who Bozkinetic wasto both internal and external audiences.

Modeling behaviors. Likewise, senior leaders made a con-certed effort to begin modeling the behaviors that were rep-resentative of the desired future image. The belief was thatby "walking the walk as well as talking the talk" (a seniorVP), they could increase understanding and buy-In of the newfuture image and provide meaningful answers to the ques-tion "Who is the new Bozkinetic?" An executive VP summa-rized this belief by saying, "I think my point is that by actingvery clearly, you help create an identity for yourself. By mak-ing those decisions you create an identity, as opposed to sit-ting around and saying, 'How do I want to convince people ofour new identity?* They will observe it when they see whatwe are doing." The CEO observed that "you vote with yourtime," by which he meant that by letting people know whatthe top leaders spent their time on gave emphasis to thoseactivities deemed most important to the success of thefuture image. He was transparent in indicating that he com-municated with many people inside and outside Bozkinetic,that he was emphasizing innovative independence, customercommunication, caring, "stewardship" of technology-for-people, and that getting the buy-in of his employees was acritical component of Bozkinetic's survival. Employees werenot blind to this "showing by doing" approach, as one middlemanager noted in explaining that in this period of leading byexample, " . . . it's about what the leadership team is doing,"so it became clear that employees noticed the modeledbehaviors, which helped to clarify the desired future image.

Postscript to the Study

Overall, our study covered three time periods: pre-spin-off(period 1), spin-off (period 2), and post-spin-off (period 3),over a total of 10 months. Our data provide clear evidence ofa pronounced identity change from time period 1 to the endof time period 3 {six months after the spin-off). Bozkinetic'sidentity was originally described (in period 1) in terms of itsrelationship with Bozco, with identity claims such as "moreinnovative," "more agile competitor," and "safe and reli-able." As period 2 came and went, ambiguity emerged aboutwho the organization had become. It was not until late inperiod 3 that management was able to begin stabilizing theorganization's identity around claims of "being somethingspecial," "doing the right thing," and "being stewards of thetechnology" through strong efforts at meaning management.A reasonable question to ask is whether at some later timeBozkinetic's identity continued to progress to some form thatwas notably different than it was at the study's conclusion atthe end of period 3. To answer this question, we revisitedone of our key informants almost two years after finishing

198/ASQ, June 2004

1

Identity Ambilguity and Change

the study. She clearly indicated that the core elements ofBozkinetic's identity, nearly two years on, were very similarto the core elements at the point at which we stopped ouroriginal data collection and were dramatically different fromBozkinetic's Bozco-era identity:

A lot of vi/hat was being talked about right after the spin has cometo fruition since. 1 think people would say that we were beginning togel as a company by 6 months after, and that there was a common-ality of our vision and our goals as a separate company. So whenwe started hitting our stride later in that year, it was more like afterthe spin than before. The actions of our leadership post-spin reallywent a long way toward stabilizing our identity.

Taken together, these data suggest that the study tracked abona fide identity change process over our 10 months ofengagement and that the point at which we left essentiallycoincided with fading identity ambiguity and the attainmentof a new identity clarity, which has held for some time,

DISCUSSION AND CONCLUSION

Organizational change is now so ubiquitous that the experi-ence of change has become something of a constant in mod-ern organizations. Change now seems to be even/where allthe time, such that fluidity and discontinuity have becomehallmarks of organizational life (cf. Bateson, 1989). Perhapsthe organizational change with the most potential for disrup-tion is a change in identity. The main purpose of this studywas to better understand how organizational identity changeoccurs in the context of a corporate spin-off, a change con-text representative of subtractive-type organizational change(Albert, 1992). Research on corporate spin-offs and otherforms of subtractive change is scarce, so our understandingof these contexts needs theoretical development. The find-ings of this study provide a starting point for that theoreticaldevelopment by explicating an emergent state of identityambiguity, the existence of which stemmed from loss ofmany of the spin-off's previous identity claims. This ambi-guity-based model of identity change thus affords us an initialgrounding that we might be able to augment with additionaltheoretical insights to build a more specified model of organi-zational identity change.

Insight into the specifics of identity ambiguity and its role inthe identity change process begins with an understanding ofIts triggers. Discrepancies between organizational identityand image (specifically, construed external image and tempo-ral identity discrepancies), along with changes in the organi-zation's social comparators, result in a state of equivocality inwhich organization members are in doubt about who they areas an organization. All three of these triggers are forms oforganizational "referents," and it is the constellation of con-vergences among these referents that promotes identitychange in the wake of the identity ambiguity produced.'* Thisidentity ambiguity occurs mainly at the level of nneanings, asold identity labels still exist yet no longer apply and new iden-tity labels have yet to take on meaning for members.

We thank an anonymous reviewer for the ^s members cope With and try to manage this sense ofinsight that the triggers are forms of u- -^ ^u . • x . ^ -^ • , , . ^organizational referents. ambiguity, they Create meanings for the identity labels from

199/ASQ, June 2004

the events, actions, and discussions within the organizationabout who the organization is becoming, as evidenced byinternally and externally projected images and the languagechosen to describe the company. These socially constructedmeanings often come from the top down because of thestrategic importance of a clear organizational identity and thesensegiving imperative (Gioia and Chittipeddi, 1991) generat-ed by members' need for sensemaking in the wake of theidentity ambiguity. If these meanings provide a coherentsense of collective identity, then stability can emerge inmembers' perceptions, ambiguity will subside, and somenew form of "identity clarity" or resolution can result. If theemergent meanings are not coherent or conflict with eachother, then the identity can remain unstable, in a state ofeither identity ambiguity or growing identity conflict.

Identity Ambiguity

The key to this process of meaning-based identity change,then, was the emergence of a state of identity ambiguity,especially as compared with the beginning state of identityclarity. The term ambiguity signifies "an ongoing stream thatsupports several different interpretations at the same time"(Weick, 1995: 91) or "a property possessed by any stimuli ofhaving two or more meanings" (Levine, 1985: 8). In organiza-tional settings, it often takes a form similar to the informationequivocality discussed by Daft and his colleagues (Daft andWeick, 1984; Daft and Lengel, 1986), who defined it as "themultiplicity of meanings conveyed by information about orga-nizational activities" (Daft and Macintosh, 1981: 211; see alsoMarch and Olsen, 1976; Meyerson, 1990). Accordingly, asapplied to organizational identity, the type of ambiguity weuncovered at Bozkinetic Involved a shared sense that therewere multiple possible interpretations of who the organiza-tion was, thus leading to a sense of unformulated or nebu-lous identity.

After a transforming organizational event like a spin-off, ambi-guity about identity becomes evident as the vagueness ofself-definition emerges in contrast to the sense of clarity heldbefore the event. It comes somewhat as a shock and initi-ates sensemaking processes among those involved {Weick,1995), serving as a trigger for sensemaking activities aimedat producing a more structured understanding. Interestingly,identity ambiguity might be viewed as an unrecognized ele-ment of Lewin's (1951) venerable portrayal of change asinvolving "unfreezing, moving, and refreezing," in that suchambiguity provides an impetus for organization members tocreate workable new ways of understanding and acting. Theambiguity experienced by Bozkinetic's members after theirspin-off was noticeable and noticed, and members felt opento discuss it because of its salience in the organization. Thisambiguity was evident in organization members' language(e.g., no preferred labels available to describe their identity, orconfusion about which labels best described the organiza-tion), in the organization's forma! and informal projectedimages (e.g., lack of consistency in expressed identity labelsor multiple identity labels used to describe the sameattribute), and in a lack of clarity about what the expressedidentity labels meant.

200/ASa June 2004


Although some suggestive evidence of ambiguity concerningorganizational identity has been present as a backgroundissue in other studies (e.g., Dutton and Dukerich, 1991; Els-bach and Kramer, 1996), the specific notion of identity ambi-guity has not been well articulated or empirically documentedin the organizational studies literature as it has in social psy-chology, where notions of self-clarity and self-certainty havebeen used in relation to an individual's self-esteem anddepression (cf, Baumgardner. 1990; Campbell, 1990; Setter-lund and Niedenthal, 1993) and where Hall (1976) and Gould(1979) have described the concept of identity resolution. Inpart, this can be attributed to the propensity of extant organi-zational identity research to focus more on content than onprocess issues (Whetten and Godfrey, 1998). Furthermore,many of those studies that have specifically examined identi-ty processes such as formation, change, and loss (e,g., Gioiaand Thomas, 1996; Glynn, 2000; Reger et al., 1994) have pro-vided evidence for the presence of identity dynamics andtheir connections with larger organizational dynamics, ratherthan studying the underlying processes associated with iden-tity's dynamism. This study extends these earlier works byproviding an explicit examination of one form of identitychange and key processes associated with the identity ambi-guity at its core.

Identity ambiguity vs. identity conflict. It is also importantto note how identity ambiguity differs from identity conflict, aconcept involving multiple organizational identities vying forpreeminence or privilege (Albert and Whetten, 1985; Fiol,2002; Golden-Biddle and Rao, 1997; Foreman and Whetten,2002), in which any one could viably serve as a collectiveanswer to the question "Who are we?" but no two are mutu-ally compatible (Glynn, 2000; Pratt and Foreman, 2000). Iden-tity ambiguity is different because it refers to a situation inwhich the organization's identity is vague, not because twoor more competing identity claims exist but because noclaims exist or, more likely, because the meanings underlyingthose claims are in doubt or subject to multiple plausibleinterpretations (see also Katz and Kahn, 1966, for their dis-tinction between role ambiguity and role conflict). For identityconflict, it is clear what the competing claims or identitiesmean for who the organization is (Golden-Biddle and Rao,1997), but it is not clear which one is more appropriate, a dis-tinction Weick (1995) highlighted as a lack of clarity involvinguncertainty as opposed to a lack of clarity involving ambiguity.

Identity ambiguity, therefore, does not necessarily involvemultiple identities or identity claims. Ambiguity can existwhen no identity claims are made or members do not feelthat the organization has a definitive identity. It can occurwhen a single organizational identity is in transition or hasbeen called into question by an exogenous or endogenousevent or feedback, or it can occur as multiple identities inhab-it the same shared cognitive context but do not conflict witheach other. For example, if the two identity claims of "innov-ative" and "independent" are both present in a particularcontext, there is no reason why they need to conflict witheach other (i,e,, being one does not preclude being theother), yet they still might be the source of ambiguity ("What

201/ASQ, June 2004

does it mean to be innovative or independent?" or even"How does being independent help us be innovative?").

Given the subtractive nature of an organizational spin-off(Albert, 1992), and the consequent divestiture of a previousidentity (cf. Van Maanen and Schein, 1979), it should not besurprising that identity ambiguity emerged instead of identityconflict. As a spun-off organization copes with the loss of itsprevious identity, a meaning void will exist until a revisedidentity can be developed. This void provides the cognitiveand affective context in which ambiguity can emerge. Actual-ly, the probability is high for emergent ambiguities (identity-based and otherwise) to arise in the wake of any subtractivechange and continue to exist until other changes occur tocompensate for what was eliminated, an oft-used strategy tohelp soften the blow of a subtractive change (Albert, 1992).The occurrence of these changes—at Bozkinetic, the devel-opment of new identity labels and meanings in response tothe sensegiving imperative—mark the transition from ambi-guity to potential conflict because of the likelihood of differ-ing ideas, perspectives, and philosophies competing for pre-eminence among organizational members.

One interesting question might be why Bozkinetic moved toidentity resolution without identity conflict. It is clear that themembers of Bozkinetic recognized and accepted the rationalefor the spin-off and the reality that they were going to beindependent but also saw that their way of doing businesswas not going to change dramatically. Theirs was not a situa-tion that changed their ground rules for action and interactionand, therefore, did not undermine existing power structures.Thus, there was little need for conflict to produce alignmentwith some markedly new or different set of rules. There was,however, pronounced ambiguity and associated tensions thatneeded to be resolved about who they were becoming as afreestanding entity.

Labels, Meanings, and Identity Change throughAmbiguity

As illustrated in Bozkinetic's spin-off, the presence of identityambiguity in an organization can be a tell-tale sign that Identi-ty change is under way. As noted, identity change oftentakes one of two forms at the organizational level: (1) whenthe labels used to express identity undergo change, or (2) themeanings underlying those identity labels change (Gioia,Schultz, and Corley, 2000). At Bozkinetic, both types of identi-ty change occurred, albeit at different times, under differentcircumstances, and with different results. The first type ofidentity change occurred during the spin-off period as topmanagement proffered new labels (Ashforth and Humphrey,1997; Fiol, 2002) to describe who the company was after thespin-off (e.g., "independent," "technology leader"). Asexpressed by our informants, members did not reject theselabels, nor did they create a conflict among competing identi-ty claims. In fact, the new labels seemed like the type ofidentity claims that any newly independent company shouldbe using to describe itself. Unfortunately, the employees didnot understand these new labels, and many members did notknow what they meant for who the company was becoming.

202/ASQ, June 2004

fdentKy Ambiguity and Change

This state of ambiguity about the meaning of the organiza-tion's identity labels represents the second form of identitychange in process. At Bozkinetic, identity ambiguity wasactually increased by top management's creation of newlabels that held little meaning for the membership. Yet identi-ty ambiguity could have emerged even if top managementhad not introduced these new labels, because the old labels(applicable to the company while it was part of its parent)probably would not have been as meaningful to employees.Either way, ambiguity is likely to have arisen as memberssought to understand what it meant to be an independentcompany and whether their old identity labels applied. Thus,whether the ambiguity arises because new labels hold nomeaning or because old labels have lost their meaning, theresult is similar: the equivocality of meaning facilitates identi-ty change via meaning change.

Because ambiguity involves equivocality of meanings, it isnot surprising that identity ambiguity led to more of a mean-ings-based form of identity change, as opposed to a labels-based change. When identity labels lose their meaningsenough for ambiguity to arise, the potential for identitychange is strong. If we have labels to describe ourselves, buttheir meaning is not clear to us, who are we really? What isour identity? Answers to such questions are likely to result indifferent meanings being applied to the identity labels, and asthose meanings become clearer or take on significance formembers, the identity represented by the labels changes.Thus identity ambiguity represents a state of identity destabi-tization, and the process of filling the void of ambiguity withmeaning can facilitate identity change.

One of the unexpected but enlightening findings of this studyinvolved the juxtaposition of both planned and unplannedaspects of identity change and their relationships to changesin labels and meanings. Clearly, Bozkinetic intended tochange and worked hard at trying to develop a new sense oforganizational identity. Just as clearly, there were strong unin-tended aspects involved with the change effort. One possibleupshot of our findings is the suggestion that intentional(planned) change is more likely to revolve around labels-based identity change (Fiol, 2002), whereas more uninten-tional (unplanned) change is more likely to revolve aroundmeanings-based identity change. The labels-based form issimilar to other forms of organizational change that occur viavarious "signaling" processes; the meanings-based form isarguably more subtle and distinctive (Corley and Gioia, 2003)and therefore has more potential for unique contributions tochanging identity. One practical implication of this finding isto make identity change issues more salient to change lead-ers. Doing so would encourage more attention to these moresubtle aspects, as well as better sensegiving processes thatare better timed to help members with their sensemaking.

From a more overarching view, it is apparent that achievingidentity change involves both cognitive and behavioralapproaches. An important part of what changed was mem-bers' perceptions of Bozkinetic in the competitive world,independent from Bozco. in this sense, identity change wasvery much a cognitive enterprise, one that provoked execu-

203/ASQ, June 2004

tives to realize that they too needed to see it as a cognitiveenterprise and engage in sensegiving activities such asincreased branding efforts and modeling of behaviors associ-ated with the desired future image. Actions in support ofidentity change seemed to matter more later in the process,perhaps because behaviors translate concepts into action. Inthe "launch" stages of identity change, then, it is the cogni-tive aspect of identity that matters; for identity change totake hold, however, ideas need to be transformed intoobservable actions.

Temporal Identity Discrepancies

Of the other concepts to come out of this study, perhaps themost interesting for understanding organizational identitychange was the emergence of a heretofore understudiedtype of identity discrepancy, temporal identity discrepancies(for related work, see Brun, 2002; Chreim, 2002). In contrastto many of the identity discrepancies discussed in previousresearch that are based, explicitly or implicitly, on Festinger's(1954) notion of social comparison—such as construed exter-nal image discrepancies (Gioia, Schultz, and Corley, 2000),current-ideal identity gaps (Reger et al., 1994), or identity-rep-utation discrepancies (Fombrun, 1996; Chreim, 2002)—themain feature of the temporal identity discrepancies at Bozki-netic was a grounding in time-based differences, a discrepan-cy more in line with Albert's (1977) temporal comparison the-ory. Temporal identity discrepancies represent instances inwhich organization members recognize an inconsistency inidentity claims when they compare a hoped-for future imagewith present or past identities that are still salient for them.Thus these discrepancies arise when perceptions of "whothe company is" currently do not match with (1) some pro-jected image of the company, (2) the perceived direction thecompany's identity is taking, or (3) past identities, or who thecompany used to be (see Foreman and Whetten, 2002, forrelated work on discrepancies as applied to organizationalidentification). >

Because past theorizing about the role of discrepancies inidentity change has given little consideration to time-basedincongruities, this finding represents an opportunity to under-stand more about why and how identity changes over time.Most conceptions of changing organizational identity arebased in a "looking-glass self" approach (Cooley, 1902), inwhich members come to understand the organization's iden-tity and any need for changing It via social comparisons (Fes-tinger, 1954) based on feedback received from outsiders.Changes in identity then arise from attempts to align identityperceptions with social feedback. Temporal identity discrep-ancies highlight the possibility that organizational identitychange can be sparked internally, by insiders looking atdesired future images or past identities and comparing themwith current identity claims. Although Albert's (1977) originaltheorizing about temporal comparisons was based on theassumption that their underlying motive involved maintainingstability of the self over time, he later expanded this toinclude the motive of recognizing changes in the self overtime (Albert, 1992). Such theorizing is consistent with

204/ASQ, June 2004


Markus and Kunda's (1986) discussions of the stability andmalleability of the self at the micro level.

Change Overload

The growing sense of change overload felt throughout theorganization provided an initial context and impetus for theambiguity to become noticeable. Change overload, although asecond-order, researcher-generated term, was instantly rec-ognizable and meaningful for our informants, helping demon-strate its credibility or face validity. Bozkinetic's experience ofchange overload stemmed from individuals' feelings of over-work, doing too many new activities, and declining commit-ment among employees. Yet our informants treated it as acollective concept that had gripped most of the organization.As a collective construct, change overload implies that Bozki-netic exceeded its comfortable or "characteristic level ofchange" (Jansen, 1996) and compares with Eby et al.'s(2000) notion of "readiness for change."

Change overload, although a straightforward idea, seems tocapture a prevalent change dynamic. It has the kind of reso-nance with these other concepts that suggests deep-struc-ture connections. Its strong presence in the midst of theidentity ambiguity is intriguing because it represents a rela-tionship between two concepts that have previously notbeen juxtaposed. Although more research is needed before aclear operationalization is possible, the notion of a collectivesense of overload in the amount or intensity of change con-fronting an organization is a key theoretical finding from thisstudy. It also holds practical significance in that it brings voiceto a concern faced by any organization coping with change,not just those undergoing a spin-off or identity change.Hence, the concept of change overload is likely to be trans-ferable to other organizations and contexts and can bethought of as a critical component in the effective manage-ment of change.

Transferability of Findings

A reasonable question often arises concerning the transfer-ability of case study findings, including grounded theory mod-els, to wider domains. Although it is always potentially prob-lematic to argue for extensions from case studies, this studyhas a number of features that suggest that the processes wefound operating at Bozkinetic are likely to share commonali-ties with other domains. Clearly, the reasons for the spin-offcould have an effect on identity change processes, but thereis nothing unusual in the spin-off context we studied, In fact,the reasons for this specific spin-off (changes in the competi-tive environment indicating that an independent companywould be more viable) are increasingly common, which lendsconfidence that similar processes are likely in other settings.

More generally, it seems fair to say that in any major changecontext, and perhaps especially a major identity change situa-tion like a spin-off, there are likely to be ambiguities.Although specific characteristics might differ, the processesassociated with those ambiguities and their resolution thatsurfaced in this study would seem to apply to other localesas well. Overall, it is apparent that our informants' experi-

205/ASQ, June 2004

ences have commonalities with other domains, so the modelseems plausibly transferable. There is little that is unique toBozkinetic, in principle, about social referent change, tempo-ral identity discrepancies, construed external image discrep-ancies, refining desired future image, or branding efforts. Forthat reason, we have confidence that the model itself is likelyto have applicability beyond this particular study. In addition,the presence of such concepts in the grounded theory pointsup another advantage of the model: beyond its specifics, themodel consolidates many issues and ideas into a coherentconstellation of change-relevant features, and it is a modelthat can become increasingly useful over time.

Given the ubiquity and pace of major change efforts in mod-ern organizations, the need to understand the processesunderlying such change has become vital for researchers.The findings of this study indicate that the role played byorganizational identity and its dynamism is an important sub-set of the broader study of organizational change processes.As past research has illustrated, significant change oftenimplicates the organization's identity; this study suggests thatif organizational identity changes, some form of identity ambi-guity is likely. Our findings provide insight into the processesand factors underlying this identity ambiguity and change.The findings and grounded model thus serve as an initial,empirical step toward understanding organizational identitychange in general, and subtractive-type change in spin-offs,in particular.

REFERENCES

Albert, S.1977 "Temporal comparison theo-

ry," Psychological Review, 84:485-503,

1984 "A delete design model ofsuccessful transitions," InJ, R, Kimberly and R, E,Quinn (eds.l. Managing Orga-nizational Transitions:169-191. New York: Irwin,

1992 "The algebra of change," InB M Staw and L. L, Cum-mings (eds). Research inOrganizational Behavior, 14:179-229, Greenwich, CT: JAIPress.

Albert, S., and 0. Whetten1985 "Organizational identity," In

L. L, Cummings and B, M.Staw (eds,). Research inOrganizational Behavior, 7:263-295. Greenwich, CT; JAIPress.

Armenakis, A., and A. Bedeian1999 "Organizational change: A

review of theory and researchin the 1990s," Journal ofManagement, 25; 293-315,

Ashforth, B. E., and R. H.Humphrey1997 "The ubiquity and potency of

labeling in organizations."Organization Science, 8:43-58.

Ashforth, B. E., and F. Mael1989 "Social identity theory and

the organization," Academyof Management Review, 14;20-39.

Barney, J.1998 "Koch Industries: Organiza-

tional identity as moral philos-ophy." In D, Whetten and PGodfrey (eds,). Identity inOrganizations; DevelopingTheory through Conversa-tions; 106-109. ThousandOaks. CA: Sage,

Bateson, M. C.1989 Composing a Life, New York:

Plume.

Baumgardner, A. H.1990 "To know oneself is to like

oneself; Self-certamty andself-affect." Journal of Per-sonality and Social Psycholo-gy, 58: 1062-1072,

Brown, M., and D. A. Gioia2002 "Making things click; Distribu-

tive leadership in an onlinedivision of an offline organiza-tion," Leadership Ouarterly,13; 397-419,

Brun, M.2002 "Creating a new identity for

France Telecom: Beyond avisual exercise," In B, Moin-geon and G. Soenen leds.).Corporate and OrganizationalIdentities; Integrating Strate-gy, Marketing, Communica-tion, and Organizational Per-spectives: 133-155, London;Routledge.

Campbell, J. D.1990 " Self-esteem and clarity of

the self-concept," Journal ofPersonality and Social Psy-chology, 59: 538-549.

Chreim, S.2002 "Reducing dissonance; Clos-

ing the gap between project-ed and attributed identity," InB. Moingeon and G. Soenen{eds-l. Corporate and Organi-zational Identities: IntegratingStrategy, Marketing, Commu-nication, and OrganizationalPerspectives: 75-90, London;Routledge,

Cooley, C. H.1902 Human Nature and the Social

Order. New York: C. Scribn-er's and Sons.

206/ASQ, June 2004


Corley, K. G., and D. A. Gioia2003 "Semantic learning as change

enabler: Relating organization-al identity and organizationallearning." In M. Easterby-Smith and M. Lyies (eds.),Handbook of OrganizationalLearning and Knov^ l̂edgeManagement: 621-636. Lon-don: Blackwell.

Daft, R., and R. Lengel1986 "Organizational Information

requirements, media rich-ness, and structural design."Management Science, 32:554-571.

Daft, R. L., and N. B. Macintosh1981 "A tentative exploration into

the amount and equivocalityof information processing inorganizational work units."Administrative Science Quar-terly, 26: 207-224.

Daft, R., and K. E. Weick1984 "Toward a model of organiza-

tions as interpretation sys-tems." Academy of Manage-ment Review, 9: 284-295.

Dutton, J. E., and J. M. Dukerich1991 "Keeping an eye on the mir-

ror: Image and identity inorganizational adaptation."Academy of ManagementJournal, 34: 517-554.

Dutton, J. E., J. M. Dukerich, andC. V. Harquail1994 "Organizational images and

member identification."Administrative Science Ouar-terly, 39: 239-263.

Eby, L. T , D. M. Adams, J. E. A.Russell, and S. H. Gaby2000 "Perceptions of organizational

readiness for change: Factorsrelated to employees' reac-tions to the implementationof team-based selling."Human Relations. 53:419-442.

Elsbach, K. D., and R. M. Kramer1996 "Members'responses to

organizational identity threats:Encountering and counteringthe Business Week rank-ings." Administrative ScienceOuarteriy, 41:442-476.

Festinger, L.1954 "A theory of social compari-

son processes." Human Rela-tions, 7: 117-140.

Fiol, C. M.2002 "Capitalizing on paradox: The

role of language in transform-ing organizational identities."Organization Science, 13:653-666.

Fombrun, C. J.1996 Reputation: Realizing Value

from the Corporate Image.Boston: Harvard BusinessSchool Press.

Foreman, P., and D. A. Whetten2002 "Members' identification with

multiple-identity organiza-tions." Organization Science,13:618-635.

Forster, N.1994 "The analysis of company

documentation." In C. Casselland G. Symon (eds.), Oualita-tive Methods in Organization-al Research: 147-166. Thou-sand Oaks, CA: Sage.

Gioia, D. A., and K. Chittipeddl1991 "Sensemaking and sensegiv-

ing in strategic change initia-tion." Strategic ManagementJournal, 12:443-458.

Gioia, D. A., M. Schultz, and K. G.Corley2000 "Organizational identity,

image and adaptive instabili-ty." Academy of Manage-ment Review, 25: 63-81.

Gioia, D. A., and J. B. Thomas1996 "Identity, image, and issue

interpretation: Sensemakingduring strategic change inacademia." AdministrativeScience Quarterly, 41:370-^03.

Gioia, D. A., J. B. Thomas, S. M.Clark, and K. Chittipeddi1994 "Symbolism and strategic

change in academia: Thedynamics of sensemakingand influence." QrganizationScience, 5: 363-383.

Glaser, B., and A. Strauss1967 The Discovery o! Grounded

Theory. Chicago: Aldine.

Glynn, M. A.2000 "When cymbals become

symbols: Conflict over organi-zational identity within a sym-phony orchestra." Organiza-tion Science, 11: 285-298.

Golden-Biddie, K., and H. Rao1997 "Breaches in the boardroom:

Organizational identity andconflict of commitment in anon-profit organization."Organization Science, 8:593-611,

Gould, S.1979 "Characteristics of career

planners in upwardly mobileoccupations." Academy ofManagement Journal, 22:539-550.

Hall, D. T.1976 Careers in Organizations.

Pacific Palisades, CA:Goodyear.

Hambrick, D. C, and K. Stucker1998 "Breaking away: Executive

leadership of corporate spin-offs." in J. Conger et al.(eds). The Leader's ChangeHandbook: An EssentialGuide to Setting Directionand Taking Action: 100-124.San Francisco: Jossey-Bass.

Hatch, M. J., and M. Schultz2002 "The dynamics of organiza-

tional identity." Human Rela-tions, 55:989-1018.

Isabella, L. A.1990 "Evolving interpretations as a

change unfolds; How man-agers construe key organiza-tional events." Academy ofManagement Journal, 33:7-41.

Jansen, K. J.1996 "Characteristic level of

change: An inherent con-straint to organizationalaction." International Journalof Organizational Analysis, 4:285-298.

Jick, T. D.1979 "Mixing qualitative and quan-

titative methods: Triangulationin action." Administrative Sci-ence Quarterly, 24: 602-611.

Katz, D., and R. Kahn1966 The Social Psychology of

Organizations. New York:John Wiley

Kiesler, S., and L. Sproull1982 "Managerial responses to

changing environments: Per-spectives on problem sensingfrom sociai cognition."Administrative Science Quar-terly, 27: 548-570.

Kumar, N., L. W. Stern, and J. C.Anderson1993 "Conducting interorganiza-

tional research using keyinformants." Academy ofManagement Journal, 36:1633-1651.

Levine, D. N.1985 The Flight from Ambiguity.

Chicago: University of Chica-go Press.

Lewin, K.1951 Field Theory in Social Sci-

ence. New York: Harper.

Lincoln, Y., and E. Guba1985 Naturalistic Inquiry. Beverly

Hills, CA: Sage.

207/ASQ, June 2004

Locke, K.1996 "Rewriting the

Grounded Theory after 25years?" Journal of Manage-ment Inquiry. 5: 239-245.

March, J. G., and J. R Olsen1976 Ambiguity and Choice in

Organizations. Bergen, Nor-way: Universitetsforlaget.

Markus, H., and Z. Kunda1986 "Stability and malleability of

the seif-concept." Journal ofPersonality and Social Psy-chology, 51: 858-^70.

Markus, H., and P. Nurius1986 "Possible selves." American

Psychologist, 41: 954-969.

Meyerson, D. E.1990 "Uncovering socially undesir-

able emotions: Experiencesof ambiguity in organiza-tions." American BehavioralScientist, 33: 296-307.

Miles, J. A., and J. R. Woolridge1999 Spin-offs and Equity Carve-

outs: Achieving FasterGrowth and Better Perfor-mance. Morristown, NJ:Financial Executives ResearchFoundation.

Miles, M., and M. Huberman1994 Qualitative Data Analysis: An

Expanded Sourcebook, 2d ed.Newbury Park, CA: Sage.

Pratt, M. G., and P. 0. Foreman2000 "Classifying managerial

responses to multiple organi-zational identities." Academyof Management Review, 25:18-42.

Reger, R. K., L. T. Gustafson, S. M.DeMarie, and J. V. Mullane1994 "Reframing the organization:

Why implementing total quali-ty is easier said than done."Academy of ManagementReview, 19: 565-584.

Robertson, P. J., D. R. Roberts,and J. I. Porras1993 "Dynamics of planned organi-

zational change: Assessingempirical support for a theo-retical mode!/' Academy ofManagement Journal, 36;619-634.

Setterlund, M. B., and P M.Niedenthal1993 "Who am I? Why am I here?:

Self-esteem, self-clarity, andprototype matching-" Journalof Personality and Social Psy-chology, 65: 769-780.

Stimpert, J. L.. L. T. Gustafson,and Y. Sarason1998 "Organizationai identity within

the strategic managementconversation: Contributionsand assumptions/' In D.Whetten and P. Godfrey(eds.}. Identity in Organiza-tions: Developing Theorythrough Conversations:83-98. Thousand Oaks, CA:Sage.

Strauss, A,, and J. Corbin1990 Basics of Qualitative

Research. Newbury Park, CA:Sage.

Van de Ven, A. H., and M. S.Poole1995 "Explaining development and

change in organizations."Academy of ManagementReview, 20: 510-540.

Van Maanen, J.1979 "The fact of fiction in organi-

zational ethnography." Admin-istrative Science Ouarterly,24: 539-550.

Van Maanen, J., and E. H. Schein1979 "Towards a theory of organi-

zational socialization." InB. M. Staw (ed.). Research inOrganizational Behavior, 1:209-264. Greenwich, CT: JAIPress.

Webb, E., and K. E. Weick1979 "Unobtrusive measures in

organizational theory: Areminder." Administrative Sci-ence Ouarterly, 24: 650-659.

Weick, K. E.1995 Sensemaking in Organiza-

tions. Thousand Oaks, CA:Sage.

Weick, K. E., and R. E. Ouinn1999 "Organizationai change and

development." In J. ISpence et al. (eds.). AnnualReview of Psychology:361-386. Palo Alto, CA: Annu-al Reviews

Whetten, D. A., and P. Godfrey(eds.)1998 Identity In Organizations:

Developing Theory throughConversations. ThousandOaks, CA: Sage.

208/ASQ, Juno 2004

Corley Gio A

Documents

Transcript of Corley Gio A