The Formation of Breakaway Organizations: Observations and a Process Model

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Abstract
Two qualitative studies examined the processes leading to the formation of breakaway organizations, which result when groups leave existing organizations to form new organizations. In the first study, analysis of interviews at 11 organizations in which group exit occurred revealed that the process unfolded in six stages: relative harmony, idea development, change, resistance, intense conflict, and exit. Five trigger events—introduction of conflicting ideas, legitimizing them, alarm, polarization of views, and justification—moved the participants through the group exit process. Study 2, conducted in three organizations in which group exit was avoided, revealed a trigger harmonizing event instead of a polarization event and a final dissonant harmony stage, instead of exit. Implications for the exit/voice/loyalty/neglect paradigm, the group studies literature, and organization theory in general are discussed.