Institutional Logic is a core concept in sociological theory and organizational studies. It focuses on how broader belief systems shape the cognition and behavior of actors.[1]
Friedland and Alford (1991) defined Institutions as both supraorganizational patterns of activity by which individuals and organizations produce and reproduce their material subsistence and organize time and space. They are also symbolic systems, ways of ordering reality, thereby rendering experience of time and space meaningful.[2]
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Focusing on macro-societal phenomena, Friedland and Alford (1991: 232) identified several key Institutions: the Capitalist market, bureaucratic state, democracy, nuclear family, and Christianity that are each guided by a distinct institutional logic. Thornton (2004) revised Friedland and Alford’s (1991) inter-institutional scheme to six sectors, i.e., the market, the corporation, the professions, the state, the family, and religions. This revision to a theoretically abstract and analytically distinct set of ideal types makes it useful for studying multiple logics in conflict and consensus, the hybridization of logics, and institutions in other parts of society and the world. While building on Friedland and Alford’s scheme, the revision addresses the confusion created by conflating institutional sectors with ideology (democracy) and means of organization (bureaucracy), variables that can be characteristic several different institutional sectors. The institutional logic of Christianity leaves out other religions in the US and other religions that are dominant in other parts of the world. Thornton and Ocasio (2008) discuss the importance of not confusing the ideal types of the inter-institutional system with a description of the empirical observations in a study—that is to use the ideal types as meta theory and method of analysis.
Organizational theorists operating within the new institutionalism (see also institutional theory) have begun to develop the institutional logics concept by empricially testing it. One variant emphasizes how logics can focus the attention of key decision-makers on a particular set of issues and solutions (Ocasio, 1997), leading to logic-consistent decisions (Thornton, 2002). A fair amount of research on logics has focused on the importance of dominant logics and shifts from one logic to another (e.g., Lounsbury, 2002; Thornton, 2002; Suddaby & Greenwood, 2005). Haveman and Rao (1997) showed how the rise of Progressive thought enabled a shift in savings and loan organizational forms in the U.S. in the early 20th century. Scott et al. (2000) detailed how logic shifts in healthcare led to the valorization of different actors, behaviors and governance structures. Thornton and Ocasio (1999) analyzed how a change from professional to market logics in U.S. higher education publishing led to corollary changes in how executive succession was carried out.
While earlier work focused on ambiguity as a result of multiple and conflicting institutional logics, at the levels of analysis of society and individual roles,[3] Friedland and Alford (1991:248-255) discussed in theory multiple and competing logics at the macro level of analsyis. Recent empirical research, inspired by the work of Bourdieu, is developing a more pluralistic approach by focusing on multiple competing logics and contestation of meaning.[4] By focusing on how some fields are composed of multiple logics, and thus, multiple forms of institutionally-based rationality, institutional analysts can provide new insight into practice variation and the dynamics of practice.[5] Multiple logics can create diversity in practice by enabling variety in cognitive orientation and contestation over which practices are appropriate. As a result, such multiplicity can create enormous ambiguity, leading to logic blending, the creation of new logics, and the continued emergence of new practice variants. Thornton, Jones, and Kury (2005) showed how competing logics may never resolve but share the market space as in the case of architectural services.