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Article
Publication date: 29 June 2020

Herman Aksom and Inna Tymchenko

This essay raises a concern about the trajectory that new institutionalism has been following during the last decades, namely an emphasis on heterogeneity, change and…

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1284

Abstract

Purpose

This essay raises a concern about the trajectory that new institutionalism has been following during the last decades, namely an emphasis on heterogeneity, change and agentic behavior instead of isomorphism and conformist behavior. This is a crucial issue from the perspective of the philosophy and methodology of science since a theory that admits both change and stability as a norm has less scientific weight then a theory that predicts a prevalence of passivity and isomorphism over change and strategic behavior. The former provides explanations and predictions while the latter does not.

Design/methodology/approach

The paper offers an analysis of the nature, characteristics, functions and boundaries of institutional theories in the spirit of philosophy and methodology of science literature.

Findings

The power of the former institutional theory developed by Meyer, Rowan, DiMaggio and Powell lies in its generalization, explanation and prediction of observable and unobservable phenomena: as a typical organizational theory that puts forward directional predictions, it explains and predicts the tendency for organizations to become more similar to each other over time and express less strategic and interest-driven behavior, conforming to ever-increasing institutional pressures. A theory of isomorphism makes scientific predictions while its modern advancements do not. Drawing on Popper's idea of the limit of domains of explanation and limited domains of theories we present two propositions that may direct our attention towards the strength or weakness of institutional theories with regard to their explanations of organizational processes and behavior.

Practical implications

The paper draws implications for further theory building in institutional analysis by suggesting the nature of institutional explanations and the place of institutional change in the theoretical apparatus. Once institutional theory explains the tendency of the system towards equilibrium, there is no need to explain the origins and causes of radical change per se. Institutional isomorphism theory explains and predicts how even after radical changes organizational fields will move towards isomorphism, that is, institutional equilibrium. The task is, therefore, not to explain agency and change but to show that it is natural and inevitable processes that organizational field will return to isomorphic dynamics and move towards homogenization no matter how much radical change occurred in this field.

Originality/value

The paper discusses the practical problems with instrumental utility of institutional theories. In order to be useful any theory must clearly delineate its boundaries and offer explanations and predictions and it is only the former 1977/1983 institutional theory that satisfies these requirements while modern advancements merely offer ambiguous theoretical umbrellas that escape empirical tests. For researchers therefore it is important to recognize which theory can be applied in a given limited domain of research and which one has little or no value.

Details

Journal of Organizational Change Management, vol. 33 no. 7
Type: Research Article
ISSN: 0953-4814

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Article
Publication date: 20 April 2015

Rusdi Akbar, Robyn Ann Pilcher and Brian Perrin

This paper aims to explore the perceived drivers behind the implementation of performance measurement systems (PMSs) in Indonesian local government (ILG). It analytically…

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3353

Abstract

Purpose

This paper aims to explore the perceived drivers behind the implementation of performance measurement systems (PMSs) in Indonesian local government (ILG). It analytically assesses Indonesia’s attempt to introduce PMSs by addressing three research questions: Do organisations in developing countries actually use PMSs to aid decision-making and help plan for future performance improvement? (RQ1) Do the three isomorphic pressures exist in the development and use of PMSs? (RQ2) and If institutional isomorphism is evident, can accountability exist within the development and use of PMSs given these pressures? (RQ3).

Design/methodology/approach

This research explores the perceived drivers behind the implementation of performance measurement systems (PMSs) in Indonesian local government (ILG). It analytically assesses Indonesia’s attempt to introduce a PMS by addressing three research questions: RQ1 Do organisations in developing countries actually use PMSs to aid decision-making and help plan for future performance improvement? RQ2 Do the three isomorphic pressures exist in the development and use of PMSs? and RQ3 If institutional isomorphism is evident, can accountability exist within the development and use of PMSs given these pressures.

Findings

Results determined that although employees perceived coercive isomorphism as being a driver of ILG compliance with President B.J. Habibie’s presidential instruction (Inpres No. 7/1999), the Laporan Akuntabilitas Kinerja Institusi Pemerintah/Performance Accountability Report of State Apparatus (known as LAKIP), many councils were still not reporting and those who were, were not doing it well. Many councils lacked management motivation, with some choosing to merely mimic (mimetic isomorphism) what others were doing. Better-resourced councils made use of external consultants or local universities where knowledge was shared (normative isomorphism).

Practical implications

An understanding of factors influencing the development and use of performance measures, in turn, can be used not only to improve PMSs in the future but to improve the quantity and quality of LAKIP reporting.

Originality/value

The theoretical development and interpretation of this research is drawn from institutional theory with a major contribution being that it provides an in-depth conceptual overview and understanding of factors influencing the development and use of performance measures. Further, it fills a gap in the literature exploring PMSs and accountability in a developing country – in this case, Indonesia.

Details

Qualitative Research in Accounting & Management, vol. 12 no. 1
Type: Research Article
ISSN: 1176-6093

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Article
Publication date: 11 March 2019

Alexander Glebovskiy

The purpose of this paper is to discuss the criminogenic nature of isomorphism and groupthink in business organisations with a view to developing a conceptual model of the…

Abstract

Purpose

The purpose of this paper is to discuss the criminogenic nature of isomorphism and groupthink in business organisations with a view to developing a conceptual model of the criminalisation process leading to criminal behaviour within businesses.

Design/methodology/approach

This paper draws on institutional theory and social psychology theory to discuss how isomorphic and groupthink processes may lead to criminal behaviour in the corporate world. The paper is based on a rigorous review of the relevant literature and theoretical frameworks regarding isomorphic dynamics, processes, factors, forces and mechanisms in the business context. The review was guided by a question of how isomorphic and groupthink processes can transform business organisations and its members into offenders. The approach applied was to transfer the existing theories of isomorphism and groupthink into the field of criminology, in order to devise a new model of the process of criminalisation.

Findings

The effects of isomorphic and groupthink processes can have a criminogenic effect on businesses and individuals in organisational settings which may coerce agents to engage in criminal behaviour. In crime-facilitative circumstances, isomorphism and groupthink foster criminal activity by cultivating homogeneous behaviour, conformity, resemblance, shared values and identical ways of thinking across and within firms. This herd behaviour can be regarded as one of the explanations for the pervasiveness of criminal and unethical behaviour in the corporate world, the consequences of which could be devastating.

Research limitations/implications

This is a theoretical analysis, not one based on empirical findings, though it does suggest a model for future testing.

Practical implications

This study explains the criminogenic nature of isomorphic and groupthink processes and contributes to the debate on the casualisation of corporate crime. This has important implications for the deterrence of illegal and unethical activities at both the organisational and institutional levels.

Originality/value

This study provides a conceptual model of the criminalisation process in businesses fostered by criminogenic isomorphism and groupthink.

Details

International Journal of Organization Theory & Behavior, vol. 22 no. 1
Type: Research Article
ISSN: 1093-4537

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Article
Publication date: 7 April 2020

Siqi Xu and Youmin Xi

This paper aims to explore the complete process and underlying mechanism that social enterprises obtain legitimacy during interactions with stakeholders from theoretical…

Abstract

Purpose

This paper aims to explore the complete process and underlying mechanism that social enterprises obtain legitimacy during interactions with stakeholders from theoretical integration of institutional theory and organization ecology perspective.

Design/methodology/approach

Based on theoretical classification, this paper selects six typical Chinese social enterprises and conducts a multi-case analysis.

Findings

The study finds that social enterprises aim at legitimizing single entity or industry and shaping stakeholders’ cognitive boundary simultaneously. Therefore, by adopting constrained cooperation and competition activities, social enterprises use normative isomorphism to achieve personal legitimation and combining ecological niche construction, social enterprises achieve organizational legitimation. By adopting fragmented cooperation-dominant or competition-dominant activities, social enterprises use mimic isomorphism supplemented by competitive isomorphism or population structure creation to obtain industry legitimation. By adopting dynamically integrated coopetition activities, social enterprises use mimic isomorphism and reflexive isomorphism to reach field legitimation.

Originality/value

This paper proposes a mechanism model that the coopetition with stakeholders influences the legitimation process, identifies four stages of social enterprise’s legitimation process and the types of legitimacy obtained in each stage and fills the gap of Chinese indigenous social enterprise research.

Details

Nankai Business Review International, vol. 11 no. 2
Type: Research Article
ISSN: 2040-8749

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Article
Publication date: 31 May 2019

Mohammad Imtiaz Ferdous, Carol A. Adams and Gordon Boyce

The purpose of this paper is to examine the influences on the adoption of environmental management accounting (EMA) in corporatised water supply organisations, from an…

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1174

Abstract

Purpose

The purpose of this paper is to examine the influences on the adoption of environmental management accounting (EMA) in corporatised water supply organisations, from an institutional theory perspective, drawing on the concepts of reflexive isomorphism and institutional logics.

Design/methodology/approach

The primary research involves case analysis of three companies in the Australian water supply industry, drawing on interviews, internal documents and publicly available documents, including annual reports.

Findings

Two key drivers for the adoption and emergence of EMA are: the emergence of a government regulator in the form of the Essential Services Commission (ESC) and community expectations with regard to environmental performance and disclosure. The water organisations were found to be reflexively isomorphic, while seeking to align their commercial logic to “sustainability” and “ensuring community expectations” logics to the legitimate adoption of EMA.

Originality/value

The paper contributes to the literature by providing case study evidence of the intentions and motivations of management in adopting EMA, and the nature of that adoption process over an extended period. Further, it provides empirical evidence of the applicability of reflexive isomorphism in the context of EMA and institutional logics.

Details

Accounting, Auditing & Accountability Journal, vol. 32 no. 4
Type: Research Article
ISSN: 0951-3574

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Book part
Publication date: 8 June 2012

Ru-Shiun Liou, Alex S. Rose and Alan E. Ellstrand

We view emerging-market multinational corporations (EMNCs) as agents for global isomorphism. EMNCs seek to enter developed markets not only to expand their business…

Abstract

We view emerging-market multinational corporations (EMNCs) as agents for global isomorphism. EMNCs seek to enter developed markets not only to expand their business operations but also to acquire advanced knowledge to enhance their core competencies. In entering these markets, EMNCs are subject to coercive, normative and cognitive pressures as they seek legitimacy. Once these firms gain legitimacy in advanced markets through the adoption of local business practices, they transfer these approaches to their headquarters in developing markets, establishing best practices in their home markets. Further, EMNCs may engage in efforts aimed at changing the institutional environment in the developing market to facilitate the transfer of learned practices from the developed market. Thus, we propose that these best practices lead to global isomorphism, but also note instances where symbolic adoption of developed market practices may slow the isomorphic process.

Details

Institutional Theory in International Business and Management
Type: Book
ISBN: 978-1-78052-909-7

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Article
Publication date: 22 June 2012

Monica Yang and MaryAnne Hyland

In this study the aim is to analyze multiple decisions in mergers and acquisitions (M&As) strategy to verify whether isomorphism appears in these decisions when a firm…

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1203

Abstract

Purpose

In this study the aim is to analyze multiple decisions in mergers and acquisitions (M&As) strategy to verify whether isomorphism appears in these decisions when a firm imitates others and to determine under what conditions the link between imitation and the degree of similarity in M&As is weakened.

Design/methodology/approach

With a sample of 4,881 completed M&As in the financial service industry, the authors adopt the generalized multivariate regression model to test the hypothesized effects of the independent variables on the degree of similarity in M&As.

Findings

Support is found for the mimetic isomorphism argument. Furthermore, firm experience and local market segmentation weaken the positive relationship between imitation and the degree of similarity in M&As.

Originality/value

This study enhances the understanding of mimetic isomorphism by not only verifying the relationship between imitation and isomorphism, but also integrating the role of organizational active agency (firm experience) and the extent to which local market competitors affect imitation and isomorphism within the industry as a whole.

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Book part
Publication date: 1 March 2021

Henny Murtini, Djoko Suhardjanto, Djuminah Djuminah and Agung Nur Probohudono

The objective of the study is to prove the suitability between the implementation of human capital disclosures on the financial statements of local governments in…

Abstract

The objective of the study is to prove the suitability between the implementation of human capital disclosures on the financial statements of local governments in Indonesia and the political system, economic system, legal system, social and cultural system, and accounting infrastructure system based on institutional theory. The study is carried out by conducting a meta-analysis on human capital disclosure fit to institutional theory. The study finds that it is more appropriate using accounting infrastructure system for human capital disclosures on the financial statements of local governments in Indonesia. Based on a meta-analysis, it is found that the normative isomorphism is widely used in Indonesia. It should be implemented on human capital disclosures on the financial statements of local governments in Indonesia. Then, it is also found that there are many regulations on human capital but there are only a few human capital disclosures on the financial statements of local governments in Indonesia.

Details

Recent Developments in Asian Economics International Symposia in Economic Theory and Econometrics
Type: Book
ISBN: 978-1-83867-359-8

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Article
Publication date: 4 April 2017

Padmi Nagirikandalage and Ben Binsardi

The purpose of this paper is to critically explore the implementation of cost accounting systems (CAS) using content analysis. In particular, it aims to examine the impact…

Abstract

Purpose

The purpose of this paper is to critically explore the implementation of cost accounting systems (CAS) using content analysis. In particular, it aims to examine the impact of Sri Lankan cultural and local characteristics on the adoption of CAS. In particular, it examines the factors that facilitate or hinder the adoption of CAS in Sri Lanka.

Design/methodology/approach

Primary data for the research were obtained by interviewing selected respondents from Sri Lanka’s manufacturing and service sectors. They were shortlisted using maximum variation sampling to obtain a representative cross-section of the national population. A total of 16 respondents were interviewed, which resulted in 57 interview paragraphs to be coded. Several theories were used to analyse them, namely, the theory of institutional isomorphism (homogeneity) and the theory of heterogeneity, as well as Clifford Geertz’s cultural theories.

Findings

A cross-comparison between the findings and relevant literature indicates the existence of complete institutional isomorphism and partial institutional heterogeneity in Sri Lanka. Heterogeneity exists in organisations such as foreign multinationals, which have adopted unique and sophisticated CAS. In addition, inadequate access to information and the orientation of the local culture has affected the implementation of CAS in Sri Lanka, with a lack of awareness of the importance of CAS, a sluggish approach to costing and cultural values forming prominent barriers to its implementation. These findings are plausible in light of the relationship between a sluggish approach towards costing (a low cost awareness), and local attitudes towards the implementation of more efficient accounting practices such as CAS.

Practical implications

This research is invaluable as a tool for Sri Lankan policymakers and practitioners, enabling the public and private sectors to provide education and training to enhance staff understanding and promote a positive attitude towards costing. With more efficient institutional CAS, the country’s economy will be more competitive internationally. As well as policymakers and practitioners, this research could be used by academicians for advancing theoretical development around the cultural triggers and barriers for adopting more innovative and fresher CAS in Sri Lanka.

Originality/value

The originality of this research can be justified on two counts. Firstly, although a wealth of research exists that examines the influence of culture on behaviour, this research specifically evaluates the impact of cultural factors on attitudes towards costing. These factors could be facilitators or obstructions for implementing CAS. Secondly, this research aims to combine both earlier and recent theories of institutionalism with Clifford Geertz’s cultural theory, to investigate how people and institutions in Sri Lanka adopt CAS. Earlier studies have focused merely on earlier theories of institutional homogeneity.

Details

Managerial Auditing Journal, vol. 32 no. 4/5
Type: Research Article
ISSN: 0268-6902

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Article
Publication date: 25 February 2014

Linne Marie Lauesen

The purpose of this paper is to investigate how well water companies in four different nationalities and political cultures are engaged in the CSR discourse. This question…

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1083

Abstract

Purpose

The purpose of this paper is to investigate how well water companies in four different nationalities and political cultures are engaged in the CSR discourse. This question is relevant after more than 20 years of privatization of the public administration's bureaucracy and its adoption of management styles, behaviours and thinking from the private business sphere. This paper seeks to critically examine how water companies take part in the CSR discourse, by which institutional mechanisms this managerial “thinking” in terms of institutional “logics” has come about, and which adopted “meanings” lie behind.

Design/methodology/approach

The paper shows a qualitatively, ethnographic investigation and discourse analysis of privatized water companies from four different political and market economy nations; small- and medium-sized water companies from the social-democratic state of Denmark; large size companies from the conservative and liberal market economy of the UK; large- and multinational companies from the USA and medium-, large- and multinationals from South Africa. Seven companies are chosen in each country from the smallest to the largest in order to obtain maximum variety and express analytical generalizations across nations and company sizes if possible.

Findings

The findings of the cross-geographical, -political, -market economical study of maximum variety of companies show how institutional logics are transferring from “implicit” CSR towards “explicit” CSR through coercive, normative and mimetic isomorphism: companies that are only engaged in coercive isomorphic “implicit” CSR show a hesitant and resistant engagement, whereas companies engaging in normative and mimetic isomorphic “explicit” CSR translate their discourses in a more authentic way. However, the findings also question the credibility of this authenticity when most CSR-reports from the water companies are made without third party accreditation, without performance indicators and only through narratives that are hard to scrutinize.

Research limitations/implications

The research has limitations towards the discourse analysis, which in Denmark was possible to conduct from both oral texts such as interviews, observation studies and document analysis, whereas in the UK, the USA and South Africa is based only on written texts from documents, CSR-reports, annual reports and written communications between regulators and companies. The research implications suggest a further replication of the findings from a more in-depth analysis of the institutional logics in these companies in the UK, the USA and South Africa by replication of the study from Denmark.

Practical implications

The practical implications of this study suggest a transformation of political instrumentation from rule-setting to incentives making to make public water service companies even more engaged in “explicit” CSR to obtain more authenticity and a higher level of legitimacy in the field compared to the strong tradition of “explicit” CSR seen in the private business sphere.

Originality/value

The originality and value of this research is shown by the empirical findings of the theoretical suggestions by Matten and Moon in how “implicit” CSR is transferred to “explicit” CSR in the privatization of public service companies in the water sector across nations, cultures, political and market economical spheres. It shows through the discourse analysis of institutional logics how institutional isomorphism is prevalent in this sector and how New Public Management systems need to conform from instrumental rule-making to incentive-making to make public service adopt CSR in a more authentic way.

Details

Social Responsibility Journal, vol. 10 no. 1
Type: Research Article
ISSN: 1747-1117

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