THESIS
2018
xii, 142, that is, xiii, 142 pages : illustrations ; 30 cm
Abstract
Studies of organizational responses to competing institutional logics generally
assume that the dominant or minority positions of competing logics is clear to firms.
This study questions that assumption and explores firms’ responses to the
co-existence of competing logics under uncertain situations. Institutional uncertainty
is defined by combining prior scholarly work on uncertainty with neo-institutional
theory. It is differentiated from the existing concept of institutional complexity. The
study documented two types of responses.
“Straddling commitment” was one of the responses studied. The analysis shows
that when uncertainty about the dominance of competing logics prevails in firm’s
environment due to their power struggle, a firm may try to adopt contradictory
policies co...[
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Studies of organizational responses to competing institutional logics generally
assume that the dominant or minority positions of competing logics is clear to firms.
This study questions that assumption and explores firms’ responses to the
co-existence of competing logics under uncertain situations. Institutional uncertainty
is defined by combining prior scholarly work on uncertainty with neo-institutional
theory. It is differentiated from the existing concept of institutional complexity. The
study documented two types of responses.
“Straddling commitment” was one of the responses studied. The analysis shows
that when uncertainty about the dominance of competing logics prevails in firm’s
environment due to their power struggle, a firm may try to adopt contradictory
policies complying with each of them. It thus maintains its legitimacy with
stakeholders supporting both logics and keep flexibility for the future. The straddling
stance can be adjusted as one logic or the other comes to dominate. Insightful external
evaluators may appreciate firms’ straddling since it provides a competitive advantage
in uncertain situation.
Another study shows that uncertainty about the dominance between emerging and
incumbent logics in institutional transition can motivate firm’s opportunism and
rigidify a firm to embrace emerging logic. A firm may respond symbolically to gain
legitimacy from professionals favoring an emerging logic. This is particularly likely for
firms in industries where uncertainty is high. However, overall legitimation of an
emerging logic in society and a firm’s dependence on shareholders who value it tends
to reduce uncertainty and facilitate a firm’s internalizing the norms embedded in an
emerging logic. Symbolic responding in then less likely.
These findings help to better define institutional uncertainty and its role in firm’s
decision-making. They document straddling commitment and opportunistic decoupling
as two responses to institutional complexity under uncertainty. They also demonstrate
that institutional uncertainty is an important boundary condition for institutional
change. The study’s findings challenge the conventional wisdom that institutional
transition is a replacement process in which one logic eliminates its competitors. In
uncertain situation, one logic can even promote adherence to its competitor. Lastly,
institutional uncertainty also provides a boundary condition for the illegitimacy
discount discussed in the category literature and some insights about corporate
governance and CEO succession.
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