Internal openness? How and why managing directors in SMEs involve employees in strategic conversations

Abstract

PurposeThis paper investigates the ways managing directors (MDs) in small and medium-sized enterprises (SMEs) involve employees in strategic conversations. The paper examines how managers interact with employees in strategic conversations, and why the managers do so (or do not), to generate empirically grounded knowledge about the nature of internal openness in SMEs.Design/methodology/approachThis study employs a general inductive approach and is based on in-depth interviews with 60 Swedish MDs with development and growth ambitions.FindingsThe paper develops a model of employee involvement in strategic conversations based on the nature and intensity of the MD–employee interaction. A key finding is that SMEs exhibit wide variation in terms of employee involvement, from virtually no employee involvement to, in some cases, far-reaching company democracy. The reasons for this variation are complex, but personal preferences and company size are shown to have an impact, as does, to some degree, ownership structure. In contrast to existing research, the limitations and drawbacks of involving employees in strategic conversations are outlined.Originality/valueThe study provides important insight into MDs' views and practices of internal openness in strategic conversations in SMEs. A model of employee involvement in strategic processes is outlined, and potential limitations of internal openness are highlighted.

Management toward Industry 5.0: a co-workership approach on digital transformation for future innovative manufacturing

“…Learning and innova on processes Hamid, 2022;Fasth and Tengblad, 2023;Peschl and Sch€ uth, 2022), to maintain and build trust for organizational changes required for transformation. Findings of this study highlight that is crucial for management to increase employee involvement for change of culture and ensuring transparent communication to maintain and re-build trust for organizational changes.…”

“…I5.0 is here viewed as an innovative manufacturing paradigm aiming for an industry based on the core elements of human-centricity, resilience and sustainability as a response to the limitations of I4.0 (Nahavandi, 2019).Further, I5.0 is applied as a holistic outlook acknowledging the importance to re-organize manufacturing processes by understanding the importance of structural, organizational, managerial, cultural and competence aspects of digital transformation (Carayannis et al, 2022). Such re-organization of manufacturing processes may include involvement of employees in strategic discussions (Fasth and Tengblad, 2023) to offer sufficient time for employees to gather information and participate (Ullrich et al, 2023) and facilitate an adaptive culture with a focus on knowledge and competence (Carlsson et al, 2022).…”