INSTITUTIONALISMS, OLD & NEW
An organization’s conformity to the common structural forms &
managerial practices prevailing within an org’l field confers
legitimacy and resource benefits from the other field members.
Institutionalization evolves from informal norms to
codified rules & regulations, sanctioned by formal
regulatory orgs, such as state medical societies &
regional college accreditation boards.
LEGITIMACY involves normative beliefs by others about the proper,
acceptable exercise of organizational authority (= legitimate power)
TAKEN-FOR-GRANTED ASSUMPTIONS are beliefs held without
challenge that a homogeneous set of organizational activities & structures
should be rewarded with financial resources, prestige, and public esteem
In contrast to organizational ecology (“why so many org’l forms?”),
institutionalists (“why so similar?”) assert wide variation is eliminated
as less-legitimate forms are starved for resources & political support.
The Old Institutionalists
Institutionalists Thorstein Veblen, John Commons & Wesley Mitchell
briefly dominated U.S. economics (1880-1910), but were eclipsed in
the triumph of neoclassical orthodoxy & the rise of Keynesianism.
Institutionalists stressed the historical, social, &
institutional factors on which economic “laws”
were contingent. Economic behaviors weren’t
immutable but conditioned by changing historical
influences, especially societal institutions which
shaped individual actors’ beliefs and actions.
In sociology, Talcott Parsons, Robert Merton & Philip Selznick promoted
institutionalism. Selznick’s TVA and the Grass Roots (1949), studied how
federal agency efforts to coopt support for its dam building back-fired, when
local officials changed TVA’s goals to serve private interests.
“Institutional commitments develop over time as the org
confronts external constraints and pressures from its
environment as well as changes in the composition of its
personnel, their interests, and their informal relations.”
Myths & Ceremonies
Orgs mirror societal conventions, playing lip-service to dominant values
& norms. A loose-coupling occurs between org’l facades & operational
cores, e.g., bureaucratic schools where classroom anarchy prevails.
Organizational field members develop shared meaning
systems, a consensus about desired qualities, values, and
behaviors. Institutionalizing common understandings
requires that “social processes, obligations, or actualities
come to take on a rule-like status in social thought and
action” (John Meyer & Brian Rowan 1977:341).
Symbolic meanings are embedded into formal structures
and routine practices permeating everyday org’l life.
Institutionalized routines often exhibit faddish, ritualistic, ceremonial &
mythic elements largely unrelated to rational efficiency or effectiveness
(DMV “red tape,” UM cap-and-gown rites). Org’l structures & practices
persist as traditional customs and habits, regardless of their rationality,
but simply because plausible alternatives to traditions grow unthinkable.
“In other words, institutionalized acts are done for no other reason than
that is how things are done” (Pfeffer 1982:240).
Mechanisms of Isomorphism
Citation classic by Paul DiMaggio & Woody Powell (1983) proposed three
mechanisms generating isomorphic conformity (convergence around a
single form), thereby reducing variation within industries & org’l fields.
☼ Coercive isomorphism stems from
political influences and cultural expectations
☼ Mimesis arises in uncertainties leading to
imitation of apparently successful forms
☼ Normative pressures originate in
occupational communities & professional assns
Causal ambiguities about org’l performance
– especially in government & nonprofit
sectors, but even in business – promote a
slavish mimicry in the diffusion & adoption of
the hottest management fads & fashions:
Taylorism, M-form, Human Relations, Matrix,
Theory Z, TQM, ISO, BPR, etc. ad nauseum.
Three Pillars of Institutions
Dick Scott defined institutions as “multifaceted, durable
social structures, made up of symbolic elements, social
activities, and material resources. … They are relatively
resistant to change.” His typology comprised 3 pillars:
Regulative
Normative
Cultural-Cognitive
Basis of
compliance
Expedience
Social obligation
Taken-for-grantedness
Shared understanding
Basis of
order
Mechanisms
Regulative rules
Binding
expectations
Constitutive schemes
Coercive
Normative
Mimetic
Logic
Instrumentality
Appropriateness
Orthodoxy
Indicators
Rules
Laws
Sanctions
Certification
Accreditation
Common beliefs
Shared logics of
action
Basis of
legitimacy
Legally
sanctioned
Morally governed
Comprehensible
Recognizable
Culturally supported