Management, Leadership and Organizational Change in a Kibbutz Factory

In the wake of organizational difficulties and economic losses in an Israeli kibbutz factory, the management hired externally for a general manager to oversee changes. The newly appointed manager wanted to shape the organization according to his vision and capitalist norms. This paper will examine the effects of the manager’s transitional style on social capital, in terms of trust and norms, and the effects on organizational culture in the factory. The study was conducted using qualitative research methods through interviews with 30 informants and analysis of documents from the kibbutz factory. The findings show that the manager’s transformational leadership style caused cultural change in the kibbutz factory—from a collectivist culture into a far more capitalistic one. Today, the factory is managed along purely business lines with minimum obligations toward individuals. To achieve this, the new manager reshaped the organization by adopting an innovative and transparent approach, and initiated human change by firing the old generation and recruiting a new and younger staff. While in his perception he was promoting a homelike atmosphere, his new leadership style created friction and tension in the factory.