Organizational Responses to Contending Institutional Logics: The Moderating Effect of Group Dynamics
| Date | 01 October 2014 |
| Author | Toke Bjerregaard,Charlotte Jonasson |
| DOI | http://doi.org/10.1111/1467-8551.12014 |
| Published date | 01 October 2014 |
Organizational Responses to Contending
Institutional Logics: The Moderating
Effect of Group Dynamics
Toke Bjerregaard and Charlotte Jonasson1
Department of Business Administration, School of Business and Social Sciences, Aarhus University,
Bartholins Allé 10, DK-8000 Aarhus C, Denmark, and 1Department of Psychology, School of Business and
Social Sciences, Aarhus University, Bartholins Allé 9, DK-8000 Aarhus C, Denmark
Corresponding author email: toke@asb.dk
This paper advances knowledge on how the forms of institutional logics that emerge and
become venerated among members of a singular organization in a heterogeneous field are
influenced by struggles between contending interest groups. It examines the moderating
effect of group dynamics that occur when an organization attempts to balance novel
institutional complexity within organizational bounds through its hiring and promotion
systems. The authors argue that, while the specific institutional oppositions of hetero-
geneous fields compel organizational changes, the institutional forms that emerge and
become legitimate among members of an organization in such fields are the effects of
indeterminate social processes of regularization and breaking of coexisting logics. The
paper provides insights into how the negotiations among groups of organizational actors
over the process and outcome of institutional change are influenced by asymmetric power
relationships yet significantly mediated by their social strategies. The findings reported
are from an ethnography of the enactment of institutional changes at a South Korean
credit card company following the economic crisis in 1997 and the International Mon-
etary Fund bailout programme.
Introduction
Institutional logics can be understood as organiz-
ing guidelines that inform actors on how to con-
struct legitimate organizations (Friedland and
Alford, 1991; van Gestel and Hillebrand, 2011).
Early contributions revolved around how new
logics replace old ones at the field level with pow-
erful effects upon prevailing organizational mor-
phology (Haveman and Rao, 1997; Thornton,
2002). While the lion’s share of more recent
research has illuminated how the existence of
plural logics affects a field’s organization, rela-
tively little research has been devoted to how indi-
vidual organizations experience and respond to a
complexity of logics (Greenwood et al., 2011).
More research on how individual organizations
filter a plurality of institutional logics is impera-
tive in order to further the understanding of ‘the
variegated responses of organizations to the expe-
rience of institutional complexity’ (Greenwood
et al., 2011).
This paper seeks to advance knowledge about
how an individual organization filters coexisting
institutional logics and how group processes
influence the responses that emerge in a heteroge-
neous field. More detailed insight into this micro-
dynamic is scarce, yet it is of critical importance
for a broad array of organizations, whether they
be professional service firms (Greenwood et al.,
2011; Smets, Morris and Greenwood, 2012), com-
mercial microfinance organizations (Battilana
and Dorado, 2010), social integration enterprises
(Pache and Santos, 2012) or research institutions
(Owen-Smith, 2003; Sauermann and Stephan,
2012). The sustainability and success of such
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British Journal of Management, Vol. 25, 651–666 (2014)
DOI: 10.1111/1467-8551.12014
© 2013 The Author(s)
British Journal of Management © 2013 British Academy of Management. Published by John Wiley & Sons Ltd,
9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA, 02148, USA.
hybrids are dependent on their abilities to strike a
delicate balance between logics, so as to retain
their hybrid nature over time, grow into stable
organizations (Battilana and Dorado, 2010) and
exploit the potential synergy of multiple logics
(Hargrave and Van de Ven, 2009; Kraatz and
Block, 2008).
Recent contributions have expanded the under-
standing of individuals and groups in moderating
responses to conflicts in institutional prescriptions
based on characteristics such as prior socializa-
tion into a logic. This stream of research accounts
for the role of organizational representation and
power distributions (Greenwood et al., 2011;
Kellogg, 2011). Responses are shaped by whether
individuals who embody given institutional logics
represent the different sides of conflicting pres-
sures within the organization (Pache and Santos,
2010). Research on responses to demands for
change in Korean universities, for instance, shows
how responses can be explained by the presence of
groups that advocate the promotion of a given
selection system within an organization in fur-
thering the organization’s goals, interests and
institutional logics (Kim et al., 2007). A particular
focus revolves around how organizational
systems affect the response to multiple logics,
such as human resource management (HRM)
systems that frame how organization members
enact logics and how organizational sustainability
is achieved amid opposing logics (Battilana and
Dorado, 2010; Pache and Santos, 2010). Hence,
hiring and socialization practices can influence
internal representation of logics, as people who
are socialized into an institutional logic become
‘carriers’ (Zilber, 2002) and advocates of that
logic (Battilana and Dorado, 2010; Pache and
Santos, 2010). These two elements interact, as
HRM practices can be an attempt to conform to
environmental pressures (Decramer et al., 2012;
Pache and Santos, 2010; Thornton and Ocasio,
1999).
This paper seeks to expand knowledge about
how group dynamics influence the form of logics
that emerge when an organization attempts to
strike a balance between opposing logics through
its HRM systems. We thus shift the focus of atten-
tion from the logics assumed to be ‘carried’ and
represented by organizational actors as determi-
nants of responses to the indeterminate processes
of negotiations among groups as they strategically
manoeuvre between logics in fights over resources
and rewards. Accordingly, in aiming to contribute
to this area of research, the present research draws
inspiration from an emerging line of work
responding to calls for research that inquires
beneath overt ceremonies of adoption and
examines actual, on-the-ground implementation,
namely ‘inhabited institutionalism’ (Bechky,
2011; Binder, 2007; Hallett and Ventresca, 2006a,
2006b; Spillane et al., 2002). As noted by Hallett
(2010):
Instead of linking politics to conflicts of interest tied
to a priori needs and values, inhabited institutional-
ism analyzes the interactions through which inter-
ests are socially constructed, and how interests
emerge from struggles over meaning. (Hallett,
2010b, p. 26)
Yet, as institutional research on structural
hybrids is still relatively scarce, and understand-
ing of organizational responses to institutional
complexity is partial, much work remains to be
done (Greenwood et al., 2011). In short, a path of
research deserves to be paved into how contesta-
tions of interest groups, and the HRM systems
within which these groups operate, shape the
organizational experience and enactment of novel
institutional complexity. These voids in the extant
body of institutional scholarship have motivated
the following question, which this paper will
answer: How do group processes shape the form
of logics that emerges and becomes legitimate
among the members of a singular organization in
a field with contradictory logics?
The present research is based on an ethno-
graphic field study of the social struggles over the
direction of change processes that played out in a
South Korean credit card company during a real-
life, macro-institutional transition phase from
Korean to American schemes of organizing under
the International Monetary Fund (IMF) inter-
vention in the post-economic crisis years. The
research reports how American-style HRM
systems that are adopted to achieve institutional
conformance and newly recruited groups (tempo-
rary workers) are drawn into processes that
momentarily maintain an emergent hybrid form
of logics. In this vein, the paper furthers knowl-
edge about how the effects of HRM practices that
are adopted in an attempt to balance coexisting
logics within organizational bounds (Battilana
and Dorado, 2010) are moderated by the negotia-
tions of contesting interest groups whose interac-
652 T. Bjerregaard and C. Jonasson
© 2013 The Author(s)
British Journal of Management © 2013 British Academy of Management.
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