1. Advanced Organizational Theory – 3/9/2010
Institutional logics
Advanced Organizational Theory – 3/9/2010

2. Authors Patricia H Thornton William Ocasio Research Interests
Adjunct Associate Professor
Duke University
Research Interests
Institutions
Governance
Innovation and Entrepreneurship
Cultural Industries
William Ocasio
Professor
Northwestern University
Corporate Governance
Organizational Attention and decision making
Executive power and politics
Organizational and Institutional Change

3. 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

4. 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

5. 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

6. 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

7. 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)

8. 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

9. 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

10. 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

11. 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

12. 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

13. 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.

14. 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)

15. 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

16. 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

17. 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

18. 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

19. Interpretive Methods Rich data analysis techniques Ideal Types
Qualitative and/or quantitative
Authors suggest triangulation of both
Find and interpret ‘meaning’
Ideal Types
Helps understand meanings that actors assign to their actions

20. 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

21. 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

22. 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

23. 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

24. 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

25. 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

26. 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

27. 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

28. 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

29. 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

30. 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.

31. 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?