Date01 September 2016
Published date01 September 2016
doi : 10. 1111/p adm .12256
Many countries use state-owned, for-prot, and thirdsector organizations to provide public services,
generating ‘hybrid’ organizational forms. This article examines how the hybridization of organiza-
tions in the public sector is inuenced by interaction between regulatory change and professional
communities. It presents qualitative data on three areas of the UK public sector that have under-
gone marketization: healthcare, broadcasting, and postal services. Implementation of market-based
reform in public sector organizations is shaped by sector-specic differencesin professional commu-
nities, as these groups interact with reform processes. Sectoral differences in communities include
their power to inuence reform, their persistence despite reform, and their alignment with the direc-
tion of change or innovation. Equally, the dynamics of professional communities can be affected
by reform. Policymakers need to take account of the ways that implementation of hybrid forms
interacts with professional communities, including risk of disrupting existing relationships based
on communities that contribute to learning.
Many countries now use mixed economies of supply for providing public services in
which state-owned, for-prot, and third sector organizations can deliver services. One
explanation for the emergence of such plural or ‘quasi-markets’ (Bartlett and Le Grand
1993) is policymakers’ desire to improve service delivery by exposing state-owned
providers to competition, while also needing to safeguard public services’ welfare role
(Van der Heijden 2013). In the UK, use of mixed economies of supply is linked to a
broader turn towards use of ‘business-like’ management practices that aim to modernize
state-owned organizations across the public sector (Hood 1995).
This article explores market-based reforms in relation to three areas of the UK public
sector. In the English National Health Service (NHS), state-owned hospitals have been
corporatized and granted more nancial freedom, while service providers from the pri-
vate and third sectors have been encouraged. In broadcasting, a compulsory quota for
commissioning programming from the independent sector was imposed upon the British
Broadcasting Corporation (BBC) in the early 1990s, and extended through subsequent
organizational reforms in the mid-2000s. In the postal industry, the state-owned provider,
Royal Mail, was converted into a public limited company (owned by the government) in
2001, followed by privatization in 2013 through otation on the London Stock Exchange.
An inuential way of interpreting market-based reforms is to describe the emergence
of ‘hybrid’ forms in public service delivery. Hybrid forms of organization – that combine
coordination through price, authority, reciprocity and trust – fall somewhere between the
distinction between market and hierarchy found in transaction cost economics, and sug-
gest a blurring of the boundaries between the public and private spheres in how providers
deliver services. Hybridity is often approached by distinguishing between ideal types of
Simon Turneris at the Department of Applied Health Research, University College London, UK. Ana Lourenço is at the
Católica Porto Business School and CEGE, Universidade Católica Portuguesa, Portugal. Pauline Allen is at the Depart-
ment of Health Services Research and Policy,London School of Hygiene and Tropical Medicine, UK.
Public Administration Vol.94, No. 3, 2016 (700–716)
© 2016 John Wiley & Sons Ltd.
organization – e.g. public, private, and third sector – and assessing how each is inuenced
by the need to respond to a regulatory context that emphasizes both the public interest and
market-like behaviour. The emergence of hybridity may be seen as a ‘coping strategy’ in
response to these contrasting demands (Evers 2005). The inuence of multiple demands on
hybrid organizations has generated both optimism, such as opportunities for new income,
and pessimism, due to the risks of losing independence and changing values (Billis 2010).
Studies at the meso (organizational/structural) level have assessed the impact of multiple
demands on public sector organizations by examining the relationship between the reg-
ulatory context and providers’ structural form, including their ownership, funding, and
relationships with other providers.
An alternative way of analysing hybridity, which has emerged in the public adminis-
tration literature, aims to provide a theory of agency to analyse the processes through
which hybrid forms are practised at the micro (service) level, including the responses of
groups and individuals (Skelcher 2012; Skelcher and Smith 2015). Rather than privilege
structural characteristics and forms of authority, these approaches explore the practices
through which hybrid forms are produced and experienced to explain how potential
tensions between different demands on hybrid organizations are negotiated. For instance,
hybrid organizations may be associated with nancial, cultural and political risks
(Brandsen and Karré 2011). At the micro level, processes such as situated knowledge use,
argumentation among stakeholders, and local resistance in response to organizational
change help to shape the emergence of hybrid forms, meaning that they cannot be reduced
to structure or agency (Gleeson and Knights 2006; Skelcher 2012).
Taking into account both perspectives, this article explores how different forms of
hybridity emerge through interaction between change at the meso level and agent reex-
ivity within organizations at the micro level. This approach responds to a recent call for
multi-level approaches to the study of hybridity, which involves: ‘linking changes on
the level of individual professionals or groups in public services to their changing, often
hybrid, organizational and political environment’ (Denis et al. 2015, p. 284). This article
addresses the following question: how is the hybridization of organizations delivering
public services inuenced by interaction between regulatory and organizational change
and the characteristics of professional communities in different areas of the public sector?
To link structure and agency, the analysis uses the theory of ‘communities of practice’
(CoPs) which represents a micro-level theory of agency in suggesting that learning within
organizations takes place through repeated social interaction among groups of individu-
als with shared interests and skills (Wenger 1998). Within the public sector, professional
communities such as healthcare professionals are critical to service delivery and innova-
tion as they hold specialist knowledge and expertise, contribute to organizational learn-
ing through social interaction, and often have the authority to moderate external change
(Ferlie et al. 2005; Amin and Roberts 2008). CoPs theory can be used to analyse, rst, how
professional communities in the public sector are inuenced by regulatory and organiza-
tional change associated with hybridization, e.g. demands for ‘commercial’ knowledge
and, second, the ways in which professional communities may resist or moderate the
implementation of change.
In the next section, different approaches to hybridity in public administration, focusing
on organizational structure or agency, are outlined. After describing the research method-
ology, the ndings concerning the impact of market-oriented reform on three UK public
sector organizations are presented and discussed.
Public Administration Vol.94, No. 3, 2016 (700–716)
© 2016 John Wiley& Sons Ltd.

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