INSTITUTIONAL LOGICSAdvanced Organizational Theory – 3/9/2010
Authors
Patricia H Thornton Adjunct Associate Professor Duke University Research Interests
Institutions Governance Innovation and Entrepreneurship Cultural Industries
William Ocasio Professor Northwestern University Research Interests
Corporate Governance Organizational Attention and decision making Executive power and politics Organizational and Institutional Change
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Introduction and Background Emerged as part of institutional theory
(1970’s) Friedland and Alford (1991) summarize as:
Defining the content and meaning of institutions Less focus on isomorphism
More focus on effects of different logics Variety of contexts/levels of analysis
Can be used to bridge micro and macro levels Recognize that actors have a hand in shaping
the institutional logic
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Early Theorizing
Introduced by Alford and Friedland (1985) Decribe the contradictory practices and beliefs
in western organizations Extended by Friedland and Alford (1991)
Each institution has a central logic Logic guides organizing principles, gives actors
vocabularies of motive and sense of self Constrains means and ends of behaviour in
that institution Provides a source of agency and change
Similar definitions
Jackall (1988): “The way a particular social world works” More emphasis on normative dimensions Less emphasis on symbolic resources
Thornton and Ocasio (1999) Emphasis on all three dimensions (all are
necessary and complementary Structural Normative Symbolic (Cognitive)
Precursors to Institutional Logics
Logics of action Defined: “Framework groups use to guide their
behavior as they confront the practical constraints on their lives” (cite)
Talks about conflicting logics sans isomorphism Power struggles
Between professions (finance, mktg., manuf.) Between social classes/cultural models
Posit the existence of logics at the supraorganizational level and emphasize culture in shaping organizational activities
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Logics as Meta-theory
All three major definitions share a core meta-theory To understand individual and organizational
behaviour Five principles
Embedded agency Society as an inter-institutional system The material and cultural foundations of
institutions Institutions at multiple levels Historical contingency
Embedded Agency
Core assumption “…the interests, identities, values, and
assumptions of individuals and organizations are embedded within prevailing institutional logics”
Decisions and outcomes are at the intersection of individual agency and institutional structure Partial Autonomy
Three levels of society Individuals competing and negotiating Organizations in conflict and coordination Institutions in contradiction and
interdependency
Society as an inter-institutional system
System of societal sectors Each sector represents a different set of
expectations for social relations and behavior
Allows sectors to be in conflict Enables two advances in institutional
analysis Non-deterministic – no institutional order has
a priori causal primacy Institutional system provides an
understanding of institutional foundations of categories of knowledge
Material and Cultural Foundations
Each institution has material and cultural characteristics Institutions develop and change from
interactions of both Changes how we look at conflict and
agency How do we know if/when there is conflict? How do we respond to said conflict?
Institutional logics look at both symbolic and normative facets of culture Some sociologists have been hesitant with
norms.
Institutions at Multiple Levels Promising field for multi/cross-level research
Organizations, markets, networks, industries, etc.
Logics at one level influence other levels Institutional logics more than strategies or
logics of action Sources of legitimacy Provide a sense of order Ontological security
Ontology d= the philosophical study of the nature of being, existence or reality in general, as well as the basic categories of being and their relations (cite)
Historical Contingency
Idea is not to develop universal theories Evaluate such theories in their time/place
context
Logics in play at one period of time may not remain in play
Logics may change over time
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Logics as a Method of Analysis Main idea:
Try to measure the effects of content, meaning, and change in institutions
Key methods Event History Methods Interpretive Methods
Archival records, Interviews, Content Analysis Ideal Types
Event History Methods
(aka. survival/duration/transition analysis)
Time series analysis Uses historical time, not organizational age Looks at how states change over time Time-constant and time-dependent events
Can accommodate data at multiple levels of analysis
Can look at which logics are having more of an impact at given periods of time
Interpretive Methods
Rich data analysis techniques Qualitative and/or quantitative
Authors suggest triangulation of both Find and interpret ‘meaning’
Ideal Types Helps understand meanings that actors
assign to their actions
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Collective Identities and Identification
Collective Identity d= The cognitive, normative and emotional connection experienced by members of a social group because of their perceived common status with other members Can also be viewed at higher levels of analysis
When they individuals identify with the collective identity, they can be influenced by it
Can be a member of several social groups (each with different identities)
Collective identities can become institutionalized into logics
Contests for Status and Power Conditioned by prevailing institutions
Logics determine how status and power are gained, maintained and lost
Logic is propagated when used by social actor in the process of competing for status and power
Classification and Categorization
Categories are a necessary component of all mindful and agentive behaviour
Social and organizational categories are determined by social institutions E.g., CEO, Return on Assets
Changes in logics lead to the creation of new categories and changes to meaning of existing categories
Attention
Emphasis on how organizational responses to stimuli are mediated by the attention of decision makers
Institutional Logics affect attention allocation Provide a set of rules and conventions
Prioritization of problems Possible solutions Linking of solutions to problems
Two mechanisms used by institutions to structure attention: Generate a set of values that order the legitimacy,
importance, and relevance of issues and solutions Provide decision makers with an understanding of
their interests and identities
Agenda
Introduction and background Defining Institutional Logics Institutional Logics as Meta-Theory Institutional Logics as Method of Analysis Institutional Logics and
Individual/Organizational Action Change in Institutional Logics
Change in Institutional Logics “How can actors change institutions if
their actions, intentions and rationality are all conditioned by the very institution they wish to change?” (Holm, 1995)
Three key mechanisms of change: Institutional Entrepreneurs Structural Overlap Event Sequencing
Antecedent/Consequence of change: Competing Institutional Logics
Institutional Entrepreneurs
Create new and/or modify old institutions Leverage resources to support their interests
May organize from the center of an existing field, or from the fringe Although Organizational Ecology would argue
that it is probably wiser to do so from the fringe Can use material and cultural resources to
justify and encourage change Rhetorical strategy (using institutional
vocabulary) Expose contradictions in logics
Structural Overlap
When individual roles and organizational structures and functions that were previously distinct are forced into association Mergers & Acquisitions
More common in organizations that bridge different organizational fields and thus have contact with multiple logics Lowers constraints and embeddedness of
actors Encourages institutional entrepreneurship
Event Sequencing
Event sequencing d= “the temporal and sequential unfolding of unique events that dislocate, rearticulate, and transform the interpretation and meaning of cultural symbols and social and economic structures” Changes in cultural schemas, shifts of resources,
emergence of new sources of power Even small changes that create discrepancies can
push the first domino Suggested ways to assess:
Nominal and Ordinal comparisons Narrative analysis
Competing Logics
NOT an explanation for change in institutional logics Antecedent or consequence of change Can facilitate resistance to institutional
change Studies have primarily looked at:
Micro: Strategies of action Macro: Institutional logic at the societal-
sector level Authors suggest that more studies
should look at multiple levels.
Major OT questions
Why do organizations exist? Why are firms the same/different? What causes changes in organizations? Why do some firms survive and others
don’t? Emerging issue?