Reflections on Institutional Theories of Organizations

Contemporary institutional theorizing in the field of organizations dates back thirty-odd years. This particularly describes what are called new or neo-institutionalisms. These terms evoke contrasts with earlier theories of the embeddedness of organizations in social and cultural contexts, now retrospectively called the ‘old institutionalism’ (Hirsch & Lounsbury, 1997; Stinchcombe, 1997). They went through a period of inattention, so that when institutional thinking came back in force after the 1960s, it seemed quite new. Institutional theories, as they emerged in the 1970s, received much attention in the field, along with other lines of thought emphasizing the dependence of modern organizations on their environments. Perhaps surprisingly, they continue to receive attention, and seem to retain substantial measures of vigor. One secondary aim, here, is to explain why. I primarily review the status and prospects of the principal themes of institutional theory. I concentrate on sociological institutionalism, as capturing core ideas in their most dramatic form, rather than the limited arguments emphasized in economics or political science. And within sociological versions, I concentrate on phenomenological theories. These reflect my own interests, are continuing loci of research creativity, and contrast most sharply with other lines of social scientific theorizing about organizations. In practice, ‘organizations’ tends to be both a research field, and a realist ideology about modern society: phenomenological thinking steps back from that commitment, and is useful in analyzing, for example, why so much formal organization exists in the modern world (Drori, Meyer,& Hwang, 2006).