Some economists view an organization, specifically the firm, as a nexus of contracts among individuals (e.g. Jensen and Meckling, 1976). This usefully draws attention to the economic interests of organizational members, and to the fact that these interests may conflict both among themselves and with those of the employer. Nevertheless, it is an inadequate perspective because it adopts an atomistic view of organizations, ignoring how they are socially constituted. Organizations are in fact complex systems of inter-group relations and networks. Some groups are employed within the organizational core; others contribute to value chains through outsourcing, sub-contracting, and various forms of partnership within a wider organizational network. The behavior and performance of these groups is not just defined in economic terms, but is also subject to logics of action that arise from what groups stand for in the eyes of the people who belong to them.
A sense of belonging to a group is reinforced when it possesses characteristics which are compatible with a person’s own individual identity (Strauss, 1959). Indeed, such characteristics may contribute to the forming of that identity. They simultaneously make for uniformity within that group and for distinctiveness from other groups. Groups differ from one another in terms of values, experiences, and behaviors. The dynamics of social relations and the subtleties embedded in inter-personal interactions can encourage ...