Emotional capability and its impact on strategic transformation:a case study of an Indian telecom firm

Abstract

Organisations are going through significant change and strategic transformation in these dynamic times. However, emotions have often been under-leveraged in the process of strategic change management. This research thesis explores how collective emotions are formed, and how leaders and organisational routines can create appropriate collective emotions to achieve relevant objectives in their strategic transformation. It also examines how firms can build an emotion-based dynamic capability through leader actions and organisational routines. The methodology adopted in this research is of a case study of an organisation going through radical change, where five teams were observed over a period of 15 months and a number of people and leaders interviewed, along with analysis of secondary data. Based on the thematic analysis of the interviews and other data, the study uses the case replication method to confirm findings. This research shows that collective emotions are formed by affective events, building on the Affective Events theory. The collective emotions formed are dependent on the type of affective events and the current emotion state of the team, including their ‘identity’ strength, and is mediated by the organisational processes of listening and addressing concerns and the historical learning of the team from similar experiences, and moderated by leader emotion management actions. The Emotional Capability of an organisation is identified as the function of the strength of three types of organisational routines, and leader emotion management actions. This paper outlines the key emotions of excitement, optimism, gratitude, interest, happiness, pride and dissatisfaction, which are necessary at different stages in the strategic transformation process, and the organisational routines and leader actions needed to build them. Finally, this research confirms the way organisational routines and HRM practices can help organisations to build an Emotional Capability as a dynamic capability, to help them in periods of dynamic change, and proposes a new conception of the role of HRM for the changing times.