Notes for Institutional Theory

The aim of this try out is to explore the solution of organisations when confronting with institutional pressures. The essay is organised as follow. Firstly, some concepts as well as news report related to institutional guess entrust be introduced. accordingly, this essay leave define and justify the conception of authenticity and the connection between genuineness and institutional process. Thirdly, the strategic responses of organisations to deal with the pressures from institutional process and an example of response in terms of institutional control will be examined.Institutional theory is a concept that emphasizes the existence of some norms, values and beliefs of the society which organisations adapt with. And the process of conformity called institutionalisation is reflected in the structures and practices of organisations (Powell & DiMaggio, 1991). According to Oliver (1991), institutional theory emphasizes more than specifically on the pressures and constraints f rom the institutional environment which is one of its two issues address (the other one is technical pressures). Institutions here include the state, professions, interest aggroup as well as public opinion (Scott, 1987b).These institutions endure join and interdependent relationships with organisations, as the behaviours of organisation argon restricted by out-of-door pressures exerted by institutions. In order to survive, organisations have to force themselves to adapt to the environment. So, they have no other choice but to imprint their behaviours consistent with away norms and rules. After discussing the environment perspective of institutional theory, the next section will regard motives of conformity as the point of departure.Institutional theory demonstrates that stability and genuineness is what organisations to attain (Powell & DiMaggio, 1983 Oliver, 1991). In terms of obtaining stability, institutional theory trick explain why organisations conform to external rul es, norms and beliefs, not because of the direct link to a positive outcome but organisations would be unthinkable to do otherwise. In other words, this consistency may not be driven by the objective of interest maximisation, but by preconscious acceptance of institutionalisation.Uniform rules, norms and beliefs produce less(prenominal) contradiction Oliver (1991). Due to attempt to obtain stability, organisations would like to draw have got from pre-existing audiences within the current external environment and imitate those organisational structures, decision- make way and so on to response to the external pressures. Before regarding obtaining legitimacy as the other motive of conformity, it is necessary to define the concept of legitimacy. There are many different comments of legitimacy with varying degrees of specificity (Suchman, 1995).Legitimacy refers to an array of established cultural accounts made by organisations to provide explanations for its existence (Powell & Di Maggio, 1991). Another specific definition is that legitimacy is a generalized perception that the actions of an entity are desirable, proper, or set aside within some socially constructed system of norms, values, and beliefs. In addition, there are three types of legitimacy, which are pragmatic legitimacy, moral legitimacy and cognitive legitimacy (Suchman, 1995). After explaining some conception of legitimacy, the next section will focal point on the connection between legitimacy and institutional process.As every split of organisation is constructed and interpenetrated by external institutions as well as finale can determine how the organization is built, how it is run, and, simultaneously, how it is understood and evaluated, legitimacy empowers organizations by making them seem natural and meaningful. So legitimacy is critical to organisation survival. Then it can also imply the easiest approach to gain legitimacy, which suggests organisations to adapt to the existed institu tional context and adjust their structures to fit with the existed norms, rules and beliefs.This point is just consistent with the idiom of the institutional theory. So gaining legitimacy is a more significant movement why organisations accept institutional process. When confronting with institutional pressures, acquiescence will be the most probable response taken by organisations. However, if anticipated legitimacy is low, organisations may have different responses to institutionalisation, like compromising on the requirements for conformity, avoiding the conditions that make conformity necessary, denying the requirements that are advised to conform, or even manipulate the criteria of conformity.As can be seen, there are five kinds of strategic responses that organisations may channelise to institutional process, which are acquiescence, compromise, avoid, defy and manipulate(Oliver, 1991). Organisations may have different responses to inconstant cause, control, context, consti tuents and content and to even different degree of the same issue. For example, in the terms of institutional control, legal coercion or government mandates and voluntary airing are two processes pressures exerted to organisations (Powell & DiMaggio, 1983 Oliver, 1991).