Institutional theory: Distinctive Features

Institutional theory differs from alternative approaches to the study of organizations in a number of ways that are important to identify. The following appear to be important:

  • Institutionalists eschew a totalistic or monolithic view of organi- zational and societal structures and processes.

The institutional perspective, more so than others, emphasizes the importance of the social context within which organizations operate. Indeed, the “figure” (organization) is often defocalized to stress the centrality of the “ground” (environment). In many institutional accounts, “the figure is not simply embedded in, but also penetrated and constituted by, the ground” (Scott and Christensen 1995: 310). As suggested in Chapter 8, institutional theorists recognize the value of attending to the larger drama, rather than to the individual player.

In addition, institutionalists are more likely than many other analysts to conditionalize their generalizations. Rather than seeking universal social laws, on the one hand, or reverting to “pure descrip- tion and story-telling,” on the other, they operate at an “intermediary level” that offers “sometimes true theories” of selected social phenomena (Coleman 1964: 516). As Swiss historian and economist Simonde de Sismondi (1837) observed nearly two centuries ago:

I am convinced that one falls into serious error in wishing always to generalize everything connected with the social sciences. It is on the contrary essential to study human conditions in detail. One must get hold now of a period, now of a country, now of a profes- sion, in order to see clearly what a man is and how institutions act upon him. (p. iv)

This view resonates with our emphasis on the importance of organiza- tion fields as a significant unit of study and level of analysis.

  • Institutionalists emphasize that even innovative actions make use of preexisting materials and enter into existing contexts which affect them and to which they must adjust

As Tocqueville (1856/1998, 2001) pointed out, the French revolu- tion arose out of central contradictions in L’Ancien Régime, and its development was subsequently shaped by this social and political framework (see Chapter 1). A more contemporary example is on offer as the “digital revolution” is beginning to challenge and reshape the contemporary field of higher education (Kamenetz 2010). While new modes of delivering education are being devel- oped and new (primarily for-profit) forms of providers (colleges) have emerged, it is highly likely that, if they are to persist, these new practices and players will be required to accommodate to existing, institutionalized structures and processes (Scott forthcoming). Insti- tutionalists stress the continuing impact of the old on the new, the existing on the becoming.

  • Institutionalists insist on the importance of nonlocal, as well as local, forces shaping organizations.

An important addendum to the primacy given to context is the recognition that this concept—particularly in the modern world—can no longer safely be delimited by geographical boundaries. Many, if not the majority of, organizations are affected by and responsive to forces far removed from their local environment. This has long been the case, but is truer in today’s world of intensified media and massive migra- tions (Appadurai 1996). As described in our discussion of institutional carriers in Chapter 4, institutional elements are highly portable and can arrive in the briefcases of consultants or the knapsacks of displaced people, come by the hiring of contract workers, or via the Internet and images of the cinema.

  • Institutionalists have rediscovered the important role played by ideas, specifically, and symbolic elements, generally, in the func- tioning of organizations.

Reigning approaches to organization analysis in our time have for too long privileged the importance of material resources, techno- logical drivers, and exchange/power processes in the shaping of organizations. From contingency theory to resource dependence and population ecology, analysts have examined in detail power and resource constraints to the neglect of cultural forces and cognitive processes. Indeed, throughout much of the 20th century, organiza- tions have been treated as if they were “culture-free” systems driven by instrumental objectives and governed by “natural” economic laws. Political scientists, whose thinking has been dominated by rational models viewing relations between nations or other political actors as reflecting realpolitik—self-interested actors driven by material interests—are increasingly attending to the role of ideas in ground- ing interests (Goldstein and Keohane 1993). Institutional theorists reclaim organizations as creatures of as well as creators of manmade culture.

  • Institutionalists accord more attention to types of effects occur- ring over longer time

Too much of the work in social science concentrates on structures and processes of the here and now. As Pierson (2004) elaborates:

Many important social processes take a long time—sometimes an extremely long time—to unfold. This is a problematic fact for con- temporary social science [where] the time horizons of most ana- lysts have become increasingly restricted. Both in what we seek to explain and in our search for explanations, we focus on the immediate—we look for causes and outcomes that are both temporally contiguous and rapidly unfolding. In the process, we miss a lot. There are important things that we do not see at all, and what we do see we often misunderstand. (p. 79)

Pioneering institutional work by Selznick and his students empha- sized the value of seeing institutionalization as a process occurring over time (see Clark 1960; 1970; Selznick 1949; Zald and Denton 1963; see also Chapter 2). These quasi-historical studies followed the devel- opment of a single organization over a relatively long period of time. Not long after, however, organizational ecologists began to conduct their longitudinal studies of organizational populations, beginning with the birth of the first organization of a given type and following the subsequent development of that population. Such studies empha- sized the importance of taking a longer time perspective, ideally captur- ing the entire history of a given form (Carroll and Hannan 1989). Although this approach recognized the importance of studying orga- nizations through time, these studies collected only minimal data about the organizations being tracked and, as Zucker (1989: 544) emphasized in her critique of this work, ecologists attended to time passing, but not to “historical time,” assuming that one year is equiv- alent to another.

By contrast, during the past two decades, institutionalists have pioneered in the development of what Ventresca and Mohr (2002: 810) label the new archival tradition, which “tends to share key sensibilities in the historiographic approach, sharing its concerns for employing the nuanced, meaning-laden, action-oriented foundation of organiza- tional processes.” Key features of this work include its reliance on “formal analytic methodologies,” “emphasis on the study of rela- tions” rather than attributes, concern with “measuring the shared forms of meaning that underlie social organizational processes,” and attention to “the configurational logics” that produce organized activity. The studies by my colleagues and me (Scott et al. 2000) and by Rao, Monin, and Durand (2003), reviewed in Chapter 8, exemplify most of these characteristics.

Still, we have far to go to fully take time seriously. In too many of our change models, time erupts to “punctuate” the equilibrium of our systems, which then return to stability. We need to attend to Streeck’s (2010) advice to realize that “time matters,” but

it matters “all the time” and not just once in a while, since insti- tutional change is basically conceived of as an unending pro- cess of “learning” about the inevitably imperfect enactment of social rules in interaction with a complex and unpredictable environment. (p. 665)

  • Closely related to this concern with time, institutionalists also accord more attention to an examination of social mechanisms.

As described in Chapter 6, interest in mechanisms directs attention away from questions regarding what happened to questions of how things happen. Attending to processes of various kinds—fueled by environmental, relational, or cognitive mechanisms (McAdam, Tarrow, and Tilly 2001: 25–26)—is also a way of uncovering the sources of agency in institutional change.

  • Institutionalists embrace research designs that support attention to examining the interdependence of factors operating at multi- ple levels to affect the outcomes of interest.

Institutionalists recognize that societies operate within and are affected by transnational processes and structures, organizational fields are affected by societal- as well as organizational-level phenom- ena, and organizations operate within fields that shape, constrain, and empower them, but are also influenced by the interests and activities of their own participants. In my view, the most interesting institutional studies are those examining the interplay of such top-down and bottom-up processes as they shape our social world.

Source: Scott Richard (2013), Institutions and Organizations: Ideas, Interests, and Identities, SAGE Publications, Inc; Fourth edition.

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