Institutional  isomorphism

DiMaggio  and  Powell  (1983)  try  to  understand  what  makes  institutions  and  organizations  so   alike.  They  use  the  terms  coercive,  normative  and  mimetic  to  explain  the  forces  that  are   making  organization  less  diverse,  and  producing  organizations  with  similar  organizational   structures.  They  view  bureaucratization  as  a  force  that  make  organizations  homogenised.  

They  also  argue  for  greater  isomorphism  in  fields  that  are  well  established:  “Once  a  field  

becomes  well  established,  however,  there  is  an  inexorable  push  toward  homogenization”  

(DiMaggio  and  Powell  1983:147).  As  the  oil  industry  in  Norway  gone  from  a  new  form  of   industry  in  the  country  to  one  of  the  biggest  and  most  influential,  it  would  be  interesting  to   see  if  this  transformation  has  had  an  influence  on  the  diversity  of  organizations  within  the   industry.  Coercive  isomorphism  is  linked  to  the  environment  around  the  organizational  field.  

The  mimetic  and  norm  forces  work  within  a  field  and  are  a  driving  force  when  it  comes  to   the  diffusion  of  structures  and  roles.  Actors  that  are  under  outside  coercive  forces  such  as   evaluation  and  regulation  usually  react  defensibly  and  this  contributes  to  the  isomorphism   of  an  organizational  field.    (Frumkin  and  Galaskiewicz,  2004)  DiMaggio  and  Powell  suggest   that  when  leaders,  managers  and  employees  of  organizations  implement  and  follow   institutional  rules  the  organization  develop  more  similarities  with  one  another.  They  

recognized  two  kinds  of  isomorphism:  competitive  and  institutional.  Regarding  institutional   isomorphism  they  suggest  that  there  are  three  kinds  of  forces  that  play  a  vital  part:  coercive,   mimetic  and  normative.    

Coercive  

The  term  coercive  can  be  understood  as  an  external  force  that  is  applied  to  gain  a  result.  

This  could  come  as  a  result  of  both  formal  and  informal  pressure  influenced  on  organizations   by  other  organizations  or  institutions.  The  coercive  pressure  often  comes  from  institutions   that  they  are  dependent  upon  in  certain  ways.  Cultural  expectation  within  a  society  where   organizations  operate  may  also  function  as  a  coercive  force.  It  can  be  felt  in  different  ways  –   persuasion,  force,  laws,  regulations  etc.  The  government  is  often  seen  as  a  key  actor  when  it   comes  to  coerciveness.  DiMaggio  and  Powell  (1983;  150)  argue  that  organizations  adopt:  

“standard  operating  procedures  and  legitimated  rules  and  structures.”    

Normative  

The  word  normative  comes  from  the  Latin  word  normati,  which  means  “from  a  standard”.  A   normative  pressure  can  be  seen  as  professionalization  of  the  industry.  DiMaggio  and  Powell   (1983;  152)  interpret  it  as:  “The  collective  struggle  of  members  of  an  occupation  to  define  the   conditions  and  methods  of  their  work,  to  control  ‘the  production  of  producers’”.  In  the  oil   business  the  demand  for  formal  education  and  knowledge  is  high.  This  could  make  the  oil   industry  highly  susceptible  this  kind  of  force,  which  leads  to  isomorphism  among  

organizations  in  the  field,  since  the  different  professions  are  susceptible  for  the  same  kind  of  

forces  as  organizations  are.  As  a  result  professions  such  as  accountants  and  engineers  can   resemble  their  counterparts  in  other  organizations,  even  more  than  other  persons  or  groups   in  their  own  organization.  An  important  aspect  causing  these  effects  is  the  filtering  of  

personnel  on  the  basis  of  their  education  level  and  background.  DiMaggio  and  Powell  claim   that  especially  industries  that  are  technology  driven  has  this  phenomenon,  as  they  often   require  personnel  who  has  a  high  degree  of  formal  education.  People  with  the  same  form  of   education  background  often  create  professional  networks,  which  extend  beyond  their  own   organization.  They  are  also  often  linked  with  a  common  professional  language  and  culture.  

This  can  lead  to  the  creation  of  groups  within  an  organization  consisting  of  personnel  with   the  same  background  and  education.  As  companies  in  the  oil  industry  often  consist  of  similar   professions  by  necessity  it  is  plausible  that  this  leads  to  a  lesser  degree  of  diversity  of  

organizations  in  the  field.    

Mimetic  

Mimetic  has  its  origin  from  the  Greek  word  mimēma  ‘that  which  is  imitated’.  The  power  of   uncertainty  is  a  strong  incentive  and  force  that  encourages  imitations  in  organizations.  In   markets  where  there  are  high  levels  of  uncertainty,  in  terms  of  technology  and  unclear  goals,   the  organizations  seems  to  mimic  themselves  to  other,  often  successful  organizations  

(DiMaggio  and  Powell,  1983).  The  economical  aspect  causes  the  reason  for  the  mimic;  when   an  ambiguous  problem  with  an  unclear  solution  accurse,  a  smaller  fiscal  expense  is  demand   to  find  a  solution.  (Cyert  and  March,  1963).  It  is  a  mimetic  process  when  an  element  of  a   culture  or  system  of  behaviour  is  passed  from  one  individual  or  organizations  to  others  by   monogenic  means.  DiMaggio  and  Powell  (1983)  use  the  term  modelling  for  the  adaption  and   imitation  of  other  organizations  when  it  is  used  to  diffuse  uncertainty.  Employees  that  have   worked  for  the  other  firms,  the  rental  of  similar  or  same  consultants,  or  even  industry   associations,  could  e  sources  of  imitations.  A  good  way  to  observe  mimetic  processes  in  a   market  is  by  analyzing  the  market  leader  with  other  companies  in  the  same  competing   market.  Often  this  is  the  case  for  firms  that  look  upon  their  main  competitor  as  a  stronger,   better  and  more  successful  organization.    

Institutional  isomorphism  and  public  sector  organizations  

The  public  sector  has  been  considered  one  of  the  key  forces  driving  the  institutionalization   of  companies  and  NGOs.  But  the  public  organizations  themselves  have  been  studied  to  a  

lesser  degree  when  it  comes  to  isomorphism  and  institutionalization.  The  tendencies  in   organizational  research  have  been  to  consider  the  actors  in  the  public  sector  as  a  catalyst   and  an  initiator  of  the  institutionalization  process  in  other  organizations  by  their  regulation   control,  licensing,  inspections  etc.  (Frumkin  and  Galaskiewicz,  2004).    

Certain  organizational  practices  generate  myths  that  are  transferred  through  relational   networks  since  they  are  conceived  as  rationally  effective.  But  a  lot  of  myths  gain  legitimacy   based  on  legal  mandates  (Meyer  and  Rowan,  1977).  

Frumkin  and  Galaskiewicz  (2004)  studied  how  public  organizations  was  affected  by  the   institutional  forces,  based  upon  data  from  the  National  Organizations  study.  They  found  that   the  institutional  forces  do  not  influence  organization  in  the  same  way.  The  governmental   organizations  were  more  susceptible  for  institutional  pressures  than  for-­‐profit  organizations.  

They  found  that  normative  and  coercive  forces  transformed  government  organizations  from   traditional  bureaucratises  structures  to  more  like  pro-­‐profit  organizations.  The  mimetic   force,  on  the  other  hand,  on  government  organizations  moved  them  towards  more   traditional  bureaucratese.  “  One  way  to  understand  these  findings  is  that  when  public   managers  are  subject  to  external  oversight  or  when  they  are  embedded  in  professional   networks,  they  are  liberated  to  some  extent  from  the  internal  pressures  they  face  on  a  daily   basis  to  bureaucratize.  (…)  We  therefore  believe  that  one  possible  interpretation  of  these   results  is  that  the  presence  of  external  influences  on  public  sector  organizations  may  rival   internal  controls  within  the  agencies  and  open  the  door  for  more  liberating  structural   transformations”  (Frumkin  and  Galaskiewicz,  2004:  303)