Uniformity and Diversity in Turkish Business Groups: Effects of Scale and Time of Founding
| Author | Behlül Üsdiken,Nisan Selekler Gökşen |
| Published date | 01 December 2001 |
| Date | 01 December 2001 |
| DOI | http://doi.org/10.1111/1467-8551.00213 |
Introduction
Over the last three decades or so there has been
an increasing interest in the cross-national study
of organizations (Clark and Mueller, 1996). In the
1970s, while mainstream research emphasized a
universal ‘logic of rationality’ governing organized
activity, others began to argue that rationality
was constructed contextually, allowing for and
supporting societal variations in organizational
arrangements. Challenges to universalism stemmed
both from views that stressed the salience of cul-
tural differences and those that granted primacy
to nationally variable institutional frameworks
(Wilkinson, 1996).
Maurice and his colleagues (Maurice, 1979;
Maurice, Sorge and Warner, 1980) were among
the first to differentiate between social institutions
and culture as societal phenomena influencing
ways of organizing, and to argue for the signifi-
cant role of the former in shaping organizational
arrangements. The ‘societal effect’ argument that
they developed has been complemented and popu-
larized more recently by the ‘political economy’
(e.g. Biggart and Orru, 1997; Hamilton and
Biggart, 1988; Orru, Biggart and Hamilton, 1991)
and the ‘national business systems’ (Whitley, 1990,
British Journal of Management, Vol. 12, 325–340 (2001)
© 2001 British Academy of Management
Uniformity and Diversity in Turkish
Business Groups: Effects of Scale and
Time of Founding*
Nisan Selekler Göks¸en and Behlül Üsdiken†
Department of International Trade, Bogˇaziçi University, PK2, 80815 Bebek, Istanbul, Turkey
email: goksenn@boun.edu.tr
†The Graduate School of Management, Sabanci University, Orhanli 81474, Tuzla, Istanbul, Turkey
email: behlul@sabanciuniv.edu.tr
This study aims to extend recent theoretical and empirical work that has begun to
question the strong homogeneity argument in much of the macro-institutional literature
on nationally dominant forms of organizing. More specifically, the paper develops the
proposition that intra-national variety is likely to be greater in business strategies and
structures than in governance patterns. Drawing upon macro-institutionalist and con-
tingency theories, testable hypotheses are derived from this proposition that postulate
relationships between size and time of founding and organizational dimensions of
strategy, administrative structure, and forms of governance. These hypotheses are then
tested on a sample of business groups that have historically been the dominant form of
large business organization in Turkey. Findings did show, as expected, that governance
structures remained insensitive to size and time of founding effects. Variety associated
with size was apparent in the case of central administrative structures, although features
associated with vertical control remained invariant. Hypotheses concerning diversification
and internationalization strategies received only partial, and in the latter case, rather
weak support. The findings are indicative, however, of divergence resulting from differ-
ences in size and institutional conditions of founding.
*This is a revised version of a paper presented at
the 16th EGOS (European Group for Organizational
Studies) Colloquium, Helsinki, Finland, 2–4 July 2000.
We thank the editors and two anonymous reviewers
of the journal for their constructive comments on our
original submission.
1992a, 1992b, 1994) perspectives. According to
these macro-institutionalist views, social institu-
tions particular to a country constitute a ‘societal
logic’ (Maurice et al., 1980), a ‘pattern of authority
relations’ (Hamilton and Biggart, 1988), or a
‘business system’ (Whitley, 1990) that mould the
dominant form of organizing that survives and
prospers within that national context. Thus, the
macro-institutionalist position advances a ‘neo-
contingency’ (Sorge, 1991), or a ‘societal con-
tingency’ framework (Clark and Mueller, 1996;
Hung and Whittington, 1997) whereby organ-
izational forms are seen as contingent upon social
institutions. As social institutions are particular to
nation states and vary between them, organizations
are expected to be alike within, but different
across, countries. Especially with the increasing
popularity of the national business systems per-
spective in the 1990s, the attention in this strand
of literature has been on showing how organ-
izations within particular nation states tend to
coalesce into distinctive forms of organizing (Hung
and Whittington, 1997). Various comparative and
country-level studies (e.g. Whitley, 1992a, 1992b;
Whitley and Kristensen, 1997) have delineated
the central features of business systems and forms
of organizing that characterize dominant economic
actors in different countries.
More recently, conceptual and empirical work
has begun to emerge that questions the strong
slant towards intra-national homogeneity in much
of the macro-institutional literature (e.g. Clark
and Mueller, 1996; Hung and Whittington, 1997;
Mayer and Whittington, 1999; Wilkinson, 1996).
Clark and Mueller (1996), for example, have
argued that there is room for organizations to
deviate from societal templates due to ownership
differences, size and changes in industrial contexts.
In their study of Hungarian large businesses,
Whitley and Czaban (1998) found that firms under
foreign control made more marked changes in
their strategies and structural arrangements in
the face of radical societal change, lending some
support to the ownership effect argument. Hung
and Whittington (1997), studying the Taiwanese
computer industry, found homogeneity in the
nature of ownership and inter-firm linkages but
also diversity in firm strategies. They attributed
the strategic diversity they observed to institu-
tional plurality. For Hung and Whittington (1997),
the plurality of rules and resources provides
purposive actors with an opportunity to choose
and, to the extent that there are differences among
the choices made, variation emerges among the
organizations embedded in the same societal con-
text. Along similar lines, Mayer and Whittington
(1999) found in their study of French, German
and British large industrial firms that ownership
and control patterns retained their nationally
specific character, whereas firm strategies and
structures were more likely to converge through
international emulation.
The present study draws upon and aims to
extend these emerging themes. To this end, it
develops the broad proposition that within forms
of organizing which have become dominant in
particular societal contexts intra-national variety
is likely to be greater in business strategies and
structures than in governance patterns. To derive
testable hypotheses from this proposition, the
study draws upon macro-institutionalist thinking
and conventional contingency theory. More
specifically, relationships are postulated between
scale and changes in macro-level institutional
frameworks and components of a nationally dom-
inant organizational form. By doing so, the study
extends recent work critical of strong intra-
national uniformity arguments, as these contribu-
tions have leaned towards adding a strategic choice
perspective to macro-institutional research. In
a different vein, the present investigation turns
to the contingency approach to hypothesize and
empirically examine the impact of organizational
contingencies as a source of variation together
with effects originating from changes at the
macro-institutional level.
Turkish business groups or ‘family holdings’
(Amsden and Hikino, 1994; Granovetter, 1994;
Guillén, 2000; Khanna and Palepu, 1999) provide
the setting for an empirical examination of these
theoretical ideas. The Turkish ‘business system’
bears close resemblance to that of South Korea,
which Whitley (1994), for example, has treated
as an archetypal case of what he calls the ‘state-
dependent system’. Very much like South Korea,
business groups, often in the form of family
‘holdings’, have been identified as the dominant
form of large business organization in Turkey
(e.g. Bugˇ ra, 1994; Bugˇra and Üsdiken, 1995; Öni s¸,
1995a). Again as in South Korea (Kim, 1996;
Zeile, 1996), even the more prominent ones vary
in scale (Bugˇ ra, 1994), some ranking amongst the
largest firms in the world (Amsden and Hikino,
1994). Moreover, over the last two decades
326 N. S. Göks¸en and B. Üsdiken
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