BU398 Lecture 7: Institutionalism
Document Summary
The institutional perspective is an emerging view that holds that under high uncertainty, organizations imitate others in the same institutional environment. The institutional environment is norms and values from stakeholders that organizations try to follow in order to please stakeholders. The institutional view believes that organizations adopt structures and processes to please outsiders, and these activities come to take on rule-like status in organizations. The institutional environment reflects what the greater society views as correct ways of organizing and behaving. Legitimacy is the general perspective that an organization"s actions are desirable, proper, and appropriate within the environment"s system of norms, values, and beliefs. Organizational theory is concerned with the set of intangible norms and values that shape behaviour. When an organizational field is just getting started, diversity is the norm, and new organizations fill emerging niches. However, once an industry becomes established, there is an invisible push toward similarity, called isomorphism.
