The Anatomy of Change: A Neo-institutional Perspective

Editors Steen Scheuer John Damm Scheuer The Anatomy – A Neo-Institutionalist Perspective of Change Copenhagen Business...

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Editors Steen Scheuer John Damm Scheuer

The Anatomy – A Neo-Institutionalist Perspective of Change

Copenhagen Business School Press

The Anatomy of Change – A Neo-Institutionalist Perspective © Copenhagen Business School Press, 2008 Printed in Denmark by Narayana Press Book design, typeset and cover design by BUSTO | Graphic Design 1. edition 2008 e-ISBN 978-87-630-9951-6 Distribution: Scandinavia DBK, Mimersvej 4 DK-4600 Køge, Denmark Tel +45 3269 7788, Fax +45 3269 7789 North America International Specialized Book Services 920 NE 58th Ave., Suite 300 Portland, OR 97213, USA Tel +1 800 944 6190, Fax +1 503 280 8832 Email: [email protected] Rest of the World Marston Book Services, P.O. Box 269 Abingdon, Oxfordshire, OX14 4YN, UK Tel +44 (0) 1235 465500, Fax +44 (0) 1235 465655 Email: [email protected]

All rights reserved. No part of this publication may be reproduced or used in any form or by any means - graphic, electronic or mechanical including photocopying, recording, taping or information storage or retrieval systems - without permission in writing from Copenhagen Business School Press at www.cbspress.dk

Table of Contents Notes on Contributors . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Chapter 1 Introduction: Change Anatomies and Processes . . . . . . . . . . . . . . . . . . 11 John Damm Scheuer

Section I | Changing Organizations Chapter 2 Interpreting the Means and the Goals: Innovation in Danish Public Libraries . . . . . . . . . . . . . . . . 33 Lars Fuglsang Chapter 3 Organizational Change and Values-Driven Management: A Perspective from Institutional Theory . . . . . . . . . . . . . . . 57 Jacob Dahl Rendtorff Chapter 4 Changing Success Criteria for Public Sector Institutions: Squaring the Circle? . . . . . . . . . . . . . . . . . . . . . . . . . 79 John Storm Pedersen Chapter 5 Convergent and Divergent Processes of Change in Organizations: Exploring Change as Translation in the Encounter of Idea and Practice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107 John Damm Scheuer

Chapter 6 Intervention, Implementation, and Translation as Metaphors of Change in Healthcare and Public Sector Organizations . . . . . 139 John Damm Scheuer Chapter 7 The Institutionalization of a Routine: Identity, Interaction, and Materiality . . . . . . . . . . . . . . . . 181 Niels Christian Nickelsen

Section II | Changing Societies Chapter 8 Ideas in EU Decision Making: Towards a Typology of Ideas and Ideational Change . . . . . . . . 209 Kennet Lynggaard Chapter 9 The Process of Legitimation . . . . . . . . . . . . . . . . . . . . . 237 Eva Boxenbaum Chapter 10 Institutions and Governance: The Dynamics of Change in the Institutional Arrangements of the Danish Labor Markets . . . . . . 263 Steen Scheuer

Section III | Conclusions Chapter 11 Conclusion: Theoretical Perspectives . . . . . . . . . . . . . . . . . . . . . . . 299 Steen Scheuer

Notes on Contributors

EVA BOXENBAUM, Ph.D., is Assistant Professor in the Department of Organization at Copenhagen Business School. She conducts research on institutional change processes, particularly the role of innovation, translation and entrepreneurship in bringing about change in mature organizational fields. Her work has been published in Strategic Organization, Journal of Business Strategies, and American Behavioral Scientist. [e-mail: [email protected]] LARS FUGLSANG, Ph.D., is Associate Professor of Social Sciences at Roskilde University. His main research interest is in how organizational frameworks are created to deal with the impact of innovation and technology on business and the public sector. He has written books and papers in the field of science and technology studies, innovation studies, service studies, and public innovation. [e-mail: [email protected]] KENNET LYNGGAARD, Ph.D., is Associate Professor in International Organization and Administration at Roskilde University. His main research interests are concerned with decision making in the European Union and the Common Agricultural Policy. His recent publications include The Common Agricultural Policy and Organic Farming: An Institutional Perspective on Continuity and Change (CABI, 2006) and “The Institutional Construction of a Policy Field”, Journal of European Public Policy (2007). [e-mail: [email protected]] NIELS CHRISTIAN NICKELSEN holds a Ph.D. in organization theory from the Copenhagen Business School. He is Assistant Professor in the department of psychology at the University of Copenhagen. His key research interests lie within the mundane co-evolution of subjectivities, instruments, and institutions in relation to reorganization and product/service development

The Anatomy of Change – A Neo-Institutionalist Perspective

in hospitals and industry. These interest circle around the complex processes involved in weaving together the various expertise, agendas, technology, and classifications of the actors. [e-mail: [email protected]] JOHN STORM PEDERSEN, Ph.D., is Associate Professor of Social Sciences at Roskilde University. He has written books and articles in the field of public administration and management, on structural reforms in the public sector, and public innovation. His current main research interests include the impact of structural reforms on the Danish public sector and the production and delivery of services by public institutions. He is former CEO of the Mayor’s Office in the Aalborg Municipality, Denmark. [e-mail: [email protected]] JACOB DAHL RENDTORFF, Ph.D., is Associate Professor in the Department of Communication, Business, and Information Technologies at Roskilde University. His publications are primarily concerned with business ethics, values-driven management, corporate social responsibility and corporate governance. He recently published “Corporate Social Responsibility, Sustainability, and Stakeholder Management” in Business Ethics and Corporate Social Responsibility (2006). [e-mail: [email protected]] JOHN DAMM SCHEUER holds a Ph.D. from the Copenhagen Business School and is Assistant Professor in the Department of Communication, Business, and Information Technologies at Roskilde University. His main research interests and focus are the study of the encounter of innovative ideas and local practice in private as well as public organizations. He studies the encounter as implementation, as diffusion or as translation processes, and he also explores ways of theorizing about “the encounter” and local organizing processes. [e-mail: [email protected]] STEEN SCHEUER, M.A., Ph.D., DS.C., is Professor of Organization and Management in the Department of Society and Globalization at Roskilde University. His most recent book is Social and Economic Motivation at Work (CBS Press, 2000). He has published in the British Journal of Industrial Relations, European Journal of Industrial Relations, Thunderbird International Business 6

Notes on Contributors

Review, Journal of Labor Research and (in Denmark) in Ledelse og Erhvervsøkonomi, Økonomi og politik, Dansk Sociologi, and Samfundsøkonomen, among others. Presently, he studies the impact of EU integration and globalization on collective interest organizations in Europe. [e-mail: [email protected]]

7

Preface

The contributors to this book are researchers from Roskilde University, Copenhagen Business School, and the University of Copenhagen. They share a common interest in exploring organizational change from a neoinstitutionalist theoretical perspective. The group has met and discussed this shared interest at meetings and seminars. While we haven’t reached agreement on a common text or program statement, we have been able to clarify the exposition of each others’ thoughts. We hope that this volume will stimulate discussion and contribute to neoinstitutionalist reasoning, argumentation, and ultimately a better understanding of societal and organizational change. Some of the activities connected to this book have been made available by a generous network grant from the Danish Social Science Research Council. We are grateful for this support and for the understanding and patience of our colleagues in the editing phases of this book. It might be added, that while the editors share last names, they are not related.

Roskilde, November 2007 Steen Scheuer and John Damm Scheuer

Chapter 1

Introduction

Change Anatomies and Processes By John Damm Scheuer

Globalization, the new economy, and the IT revolution are some of the words used when researchers, as well as practitioners, try to explain the seemingly ever-increasing speed of change in contemporary society. Whatever the label, organizations today are facing change in a host of different ways. Sometimes they act as “change-takers,” forced to adapt to changes and innovations coming from the outside. At other times they are “change-makers,” who foster innovation and change, giving them a competitive advantage or a heightened legitimacy. Sometimes they force others to adapt to these changes. What are the drivers of change in the organizations of the twenty-first century? What is the anatomy of change, or how is change initiated and received? Who and what takes part? What constitutes real change and what is just continuity or conservatism in the guise of change? These are the central questions motivating the contributions to this book. Its basic premise is to ask scholars from a number of theoretical fields and scholarly traditions (sociology, economics, political science, business economics, and law) to illuminate these issues from their theoretical and analytical/empirical backgrounds. The contributions are organized into two main sections. The first focuses primarily on change at the organizational level. The contributions in the second section focus primarily on change at the societal level. Since processes of change at the micro-, meso- and macrolevel are, however, interrelated, this division simply represents an organizing principle rather than an attempt to separate organizational from societal development and change. The authors of this volume all relate to, develop, or discuss institutional


theory. Some of them confront central questions and issues in institutional theory related to organizational change. Others combine institutional theory with other theoretical perspectives in order to explore how these perspectives may cross-fertilize and develop our understanding of organizational change. The main themes discussed by the contributors to this volume are:

• Convergence and divergence in organizational fields • The role of ideas in institutional change • The role of materiality in the institutionalization of routines • Institutionalism compared to other metaphors of change • Theoretical and empirical questions related to institutional change

Each chapter in this volume asks specific research questions that relate to broader issues and discussions in institutional theory. In the following sections a sketch of these issues and discussions will be drawn in order to demonstrate more accurately how each contribution relates to these issues and discussions.

Convergence and Divergence in Organizational Fields Explaining Convergence and Homogeneity in Organizational Fields Neoinstitutionalist research first started out explaining the surprising homogeneity and convergence of structures and practices in public, as well as private, organizations in western industrialized countries. Neoinstituionalist “organizational analysis takes as a starting point the striking homogeneity of practices and arrangements found in the labour market, in schools, states, and corporations” (DiMaggio and Powell 1991, 9). Its adherents focus on institutionalization as the diffusion of standard rules and structures; theorize institutions as macro-level abstractions made up of taken-for-granted scripts, rules, and classifications; and propose that institutionalization occurs at the sectoral or societal level rather than at the organizational level (DiMaggio and Powell 1991). Meyer and Rowan (1977, 1991) described organizational blueprints and recipes for formal structure as rationalized myths. They claimed that organizations adopt such rationalized myths in order to align themselves symbolically with the rational myths of the organizational fields of which they are a part. The result of such an alignment is that the organization is perceived as legitimate by its environment, which in turn is supposed to affect the flow of resources to the organization from the environment. Internally, the adopted 12

Introduction

blueprint/recipe is, however, often decoupled from the operational level so that operational effectiveness is maintained. Meyer and Rowan claimed that isomorphism was an effect of these processes, making organizations in an organizational field still more alike. DiMaggio and Powell’s article from 1983 (DiMaggio and Powell 1991) identified the mechanisms that were supposed to make isomorphism occur in organizational fields – that is, make organizations become still more (structurally) alike in a field. They pointed out three important types of mechanisms, or isomorphic pressures – coercive, imitative, and normative – that bring about isomorphism. Coercive isomorphism occurs when pressure to adopt a particular organizational form comes from other organizations that can exercise power over it. Mimetic isomorphism occurs under conditions of significant uncertainty about what the most appropriate organizational form actually is. In this form, the safest strategy appears to be to copy whatever is in fashion with other organizations that are perceived as modern or successful. Finally, normative isomorphism is a type of copying that results from processes of professionalization and institutionalization where professional staff undergo relatively uniform training and participate in similar social networks, and then carry the ideas they have picked up in these contexts out to the many different organizations that employ them (DiMaggio and Powell 1991; Pollit 2001). As a consequence of these groundbreaking insights, earlier research was often directed at studying isomorphic processes in organizational fields in institutional theory (Dobbin et al. 1993; Friedland and Alford 1991; Strang and Meyer 1993). Today institutional researchers have, however, started looking in other directions.

Explaining Divergence and Heterogeneity Neoinstitutional researchers have increasingly moved from studying homogeneity and convergence to studying heterogeneity and variation in organizational forms and practices (Greenwood and Hinings 1996; Ruef and Scott 1998). Lounsbury and Ventresca (2003, 470) suggest that a focus on spatial variation can facilitate analyses of how different positions in a field, relational connections, or identities shape whether organizations adopt novel practices, and how they then implement them. Researchers like Scott (et al. 2000) and Powell (1991) have introduced a field-level approach to the analysis of change, which aims to uncover the heterogeneity of actors and their practices, as well as the multilevel 13


processes by which fields retain coherence and become transformed (Lounsbury 2003). Scott (et al. 2000) has tracked the dynamics of institutional actors, logics, and governance systems in the healthcare field of the San Francisco Bay Area since the 1940s. They show how field-level changes were driven not only by the claims and interests of actors but also by shifting belief systems and regulatory structures that took shape at the field level (Lounsbury 2003). As a consequence of these developments, change processes in organizational fields may be understood as more complex than anticipated by earlier institutionalists. Other approaches to the analysis of institutional stability and change may be needed. The different types of mechanisms driving change at the individual, the organizational, and the field level will have to be identified, as well as connections between these levels and mechanisms of change (Poole and Van de Ven 2004). Contributions Related to this Theme Steen Scheuer asks: Which institutional and other factors drive change of national institutions, and to what extent are they influenced by globalization and technological advances? He takes his point of departure in the proposition that market economies, as well as industrial relations systems, are not converging under the influence of globalization and technological change. Scheuer then asks what is driving change in national industrial relations systems. Theoretically, his analysis is based on the varieties of capitalism (VOC) approach, which describes the industrial relations system as one of five general types of institutional arrangements, or systems, found in western industrialized countries: the corporate governance system, the industrial relations system, the intercompany system, the vocational training and education system, and the social welfare system. Empirically, his analysis focuses on developments and changes in the Danish industrial relations system. He discusses how six institutional factors mediate, influence, and are balanced against market forces under the influence of globalization: 1) union density and collective bargaining coverage, 2) trends in composition of the labor force, 3) changes in labor law, 4) trends in union impact on wages and other economic conditions, 5) the prevalence of industrial conflict, and 6) changes in the political orientation of unions. He concludes that some aspects of the Danish industrial relations system are quite persistent (e.g., union density, bargaining coverage, minimal legal regulations, etc.) while other aspects (e.g., the reduction of working hours, an extra week of holiday, 14

Introduction

the decentralization of pay bargaining, the steep decline in industrial conflict, etc.) have changed substantially. Finally, he notes that national industrial relations systems do not simply converge or diverge, but are constantly undergoing institutionally embedded changes caused by inspiration from the world outside (e.g., from the OECD, by economic difficulties, etc.) John Damm Scheuer asks: How may processes of convergence and divergence in organizational fields be studied and explained as translation processes? Scheuer starts with the premise that neoinstitutionalist researchers have begun studying heterogeneity and variation in organizational forms and practices in addition to homogeneity and convergence. He then explains how neoinstitutionalists are increasingly combining institutional and more practice-based perspectives in order to understand the microprocesses on which institutional orders are built and changed. Finally, he explains that changes may take place at several different levels – the organizational, field, societal, and global levels – and that these changes may interact. Consequently, he suggests that a new model of institutional change is needed that is able to take this kind of complexity into account. He reviews the relevant literature, and asks how processes of organizational change may be studied and explained using a model of translation (when an idea encounters practice), and how this model helps to explain convergence and divergence in organizations. The model is used to analyze how healthcare professionals in a clinic for orthopaedic surgery and in a psychiatric ward at a minor hospital in the Copenhagen Hospital Corporation encounter the idea of “clinical pathways.” Some conclusions are (a) that an idea and the human and nonhuman elements associated with it are co-constructed in specific time-space contexts, (b) that an idea may, at the same time, be translated in ways that are both similar to and divergent from its origination and (c) that translation may result in intended as well as unintended effects depending on how and which elements are associated with an idea in a specific time-space context. Another more general conclusion is that processes of organizational and institutional change cannot be reduced by referring to simple and partly mistaken theories about what drives human and nonhuman action. When scrutinized in detail, processes of homogeneity and convergence simply turn out to be more complex and heterogeneous than formerly assumed. Eva Boxenbaum asks: How are different strategies of legitimation used to launch a new and innovative idea in a mature organizational field? 15


The idea in question is that of socially responsible investment (SRI). SRI is a set of practices whose aim is to generate high return on investment while simultaneously pursuing social gains. The introduction of SRI in the Canadian province of Quebec is used as a case study. A discussion paper on corporate social responsibility and SRI was published by the provincial parliament of Quebec in 2002, and was followed by the establishment of an SRI fund with the objective of investing in small and medium sized enterprises that developed, used, or distributed environmentally friendly technologies in Quebec. The investment fund was formed by two private firms that invested pension funds of workers, and an environmental NGO that was responsible for distributing public funds to local entrepreneurs who helped protect the environment. Boxenbaum first identifies the different frames and ways of associating concepts of actors. She then examines how the different actors involved engaged creatively with the different frames to make SRI gain cognitive legitimacy. A process model is then deduced that describes three dimensions through which embedded actors transformed an illegitimate frame into one that reflected dominant, institutionalized beliefs in the field. The first dimension suggests that an idea has to be in accordance with individual preferences – that is, the values and beliefs of those legitimizing the idea. The second dimension is strategic reframing, whereby legitimizing actors pragmatically evaluate and choose which reframing of an idea will appeal most to actors who can either support or prevent the realization of the idea. The third dimension is related to the legitimizing actors’ attempts to grounding the idea locally by connecting the idea to established, legitimate practices in the form of routine procedures and daily activities. John Storm Pedersen asks: Which institutional success criteria are important to managers in Danish public sector organizations? Have they changed, and if so, what are the consequences of these changes? He focuses on the success criteria that managers in the Danish public sector have to fulfil now, as well as in the near future. On the basis of a representative survey, he concludes that public managers think their success or failure is measured on the basis of four success criteria: 1) the quality of the services delivered, 2) the degree of democratic (stakeholder) influence on production, delivery, and consumption, 3) the production and delivery of tailored services to the single user, and 4) the use of market mechanisms. The managers think, however, that they are not evaluated on the basis of criteria concerning eco16

Introduction

nomic efficiency in the daily operation of their institutions. Petersen suggests that the structural reform of Danish public institutions and the introduction of New Public Management (NPM) – in the form of an increased use of contract, rather than budget and monopoly models – will result in public managers being forced to take criteria concerning economic efficiency in operations more seriously. He anticipates consequences including an enlargement of the set of success criteria that public sector institutions have to fulfil, and an increase in the complexity of the production and delivery of services in public sector institutions. It will also become more difficult, if not impossible, for managers to fulfil the success criteria, because over time public institutions will have to fulfil more and more success criteria, at a higher and higher level, within relatively fixed budgets.

The Role of Ideas in Institutional Change Neoinstitutionalists began by focusing on institutionalization as the diffusion of standard rules and structures in organizational fields (DiMaggio and Powell 1991). Consequently, it was implied that there was something that moved across time and space in such fields making them more homogeneous. Institutionalist researchers identified that something as ideas (Campbell 2004; Czarniawska and Joerges 1996). John Campbell (2004) points out that institutionalists have been criticized for not sufficiently incorporating ideas into their analysis of decision processes and institutional change. According to Campbell the critique may be boiled down to five questions that institutionalists will have to answer in relation to ideas: 1. What are ideas and how may they be defined? 2. W hich actors are responsible for the meaning of ideas and what role do they play? 3. How are ideas affecting institutional change and how are institutions affecting ideas? Which causal mechanisms are involved? 4. Under which conditions is it likely that ideas affect institutional change? 5. Which methodology is most appropriate when trying to decide whether ideas have affected institutional change? Czarniawska and Joerges (1996) have defined and shown how ideas travel and become institutionalized in organizational fields. According to Czarniawska 17


and Joerges, ideas are “images which become known in the form of pictures or sounds (words can be either one or another).” They can then “be materialized (be turned into objects or actions) in many ways: pictures can be painted or written (like in stage-setting), sounds can be recorded or written down (like in a musical score) and so on and so forth” (Czarniawska and Joerges 1996, 20). When ideas move they are translated (Latour 1986) and often objectified, turned into objects like reports or books. These objects disembed (Giddens 1984) or decontextualize (i.e., ignore) the specific conditions under which the idea was introduced and practised, such as the local context in an organization. When an idea has been objectified it may travel across time and space and may be recontextualized, or re-embedded, (Giddens 1984) in another time-space context. During the translation process the idea is typically translated into an object (for instance a prototype or some kind of document describing how the idea should be translated locally), then into actions, and finally into an institution, if the actions are repeated regularly. The translation can be performed by any actor who decides to react to and/or act on behalf of the idea and, thereby, extend or diminish its power. Fashions – generally accepted master ideas and processes of attention – are seen as especially important in relation to the translation process and the impact of different ideas on change. The focus of attention is supposed to depend on what the actors know in advance, on cultural assumptions, on political structures, and on what leaders, the market, and the general public find important at a given time and place. John Campbell (2004) focuses on how ideas influence decision processes and institutional change. Campbell distinguishes between cognitive and normative ideas. Cognitive ideas specify causal relations while normative ideas express the values, attitudes, and identities of the actors. Cognitive ideas are related to paradigms that represent (and limit) the basic assumptions upon which we base our understanding of causal relationships and the action programs of actors. Public opinions represent public assumptions that limit actors in their translation of values, attitudes, and identities into legitimate action programs. Campbell suggests that if ideas are to have an influence on top decisionmakers like politicians, bureaucrats, and top managers in industry, they will have to be translated into programs that top decision-makers can incorporate into their decision processes. He sums up what the necessary conditions are for ideas to have an impact and result in institutional change. Since key decisionmakers have to deal with important problems, crises, and uncertainties, dif18

Introduction

ferent ideas and programs must, first and foremost, be accessible to them. The ideas and programs have, moreover, to be convincing and in accord with the dominant paradigm. Another criterion is that a program has to be perceived as an effective solution to the problem at hand. Programs tend to be perceived as effective if they are packaged in a way that makes them understandable to decision-makers, if they offer clear guidelines, and if decision-makers believe the programs have been empirically proven to actually work. If programs live up to these conditions, decision-makers will perceive them as legitimate, and in accordance with public opinion. Campbell thinks that institutions may affect the impact of ideas by functioning as filters. The formal and informal institutional channels through which actors get access to key decision-makers may influence the impact of ideas and programs on decision processes and institutions. The way institutions are organized may do so, as well. Surrounding institutions may also affect the impact of ideas and programs. While the contributors above have focused on the concept of and processes through which ideas become institutionalized, other researchers have examined the idea itself and asked whether ideas may have characteristics that affect institutional change. Kjell Arne Røvik (1998) suggests that ideas that travel far and fast in organizational fields share some common characteristics. They are:

• recommended by an authoritative organization in the field; • presented as a tool or concept that will work everywhere; • easily communicated and presented as a commodity on a market; • defined as new, modern, and innovative compared to older recipes; • designed in order to avoid conflicts and avoid favoring special interest groups; • communicated through dramatic stories about their development and acceptance; • presented as an opportunity for development and growth for the individual members of the organization. Contributions Related to this Theme Kennet Lynggaard’s central concern is similar to that of Røvik and Campbell. He asks: What is the role of ideas in institutional change and are some ideas more susceptible to change than others? Lynggaard discusses, develops, and empirically tests a new typology of ideas and ideational change that supplements existing typologies of ideas in institu19


tional analysis. Ideas have been defined as issues, paradigms, information, or knowledge, and judged by their relative persuasiveness, but no one has investigated how resistant or susceptible different types of ideas involved in decision making processes are to change. To do so, Lynggaard has developed a typology of four types of ideas: theoretical, normative, analytical, and cognitive. He then tests these ideas empirically in a case study focusing on decision processes related to the common agricultural policy (CAP) of the European Union (EU). According to the study, cognitive ideas first gave rise to concerns related to surplus production and budget pressures. By the late 1980s and the early 1990s, these elements were associated with theoretical ideas suggesting causal relationships between price policies and production output, normative claims related to environmental protection, food safety and quality, and analytical ideas generated through evaluations of previous policies and policy outcomes. Consequently, cognitive ideas related to surplus production and budget pressures had, by the late 1990s, transformed into analytical ideas. This was also due to the build-up of in-house expertise in the Commission Services. Agents of cognitive ideational change in the late 1980s and early 1990s, and agents of analytical ideational change in the late 1990s, were all found within the Commission and the Commission Services. Lynggaard posits that normative ideas about protection of the environment, and food safety and quality, have been relatively stable since the mid-1980s even though the priority given to these issues by the Commission and the Commission Services has changed. As a consequence, he argues that cognitive ideas are more susceptible to change than normative ideas. Finally, he concludes that his study lacked enough empirical evidence to allow an assessment of the relative susceptibility to change of cognitive and normative ideas vis-àvis theoretical and analytical ideas.

The Role of Materiality in the Institutionalization of Routines Routines and institutions The concept of the institution and a routine are interrelated and interdependent in neoinstitutionalism; one may not be understood without the other. Berger and Luckmann provide a definition of institutions, wherein their routinized characteristics become apparent:

20

Introduction

Institutionalization occurs whenever there is a reciprocal typification of habitualized actions by types of actors. Put differently, any such typification is an institution. … The typifications of habitualized actions that constitute institutions are always shared ones. They are available to all members of the particular social group in question, and the institution itself typifies individual actors as well as individual actions. The institution posits that actions of type X will be performed by actors of type X. … Institutions further imply historicity and control. Reciprocal typifications of actions are built up in the course of a shared history. … Institutions also … control human conduct by setting up predefined patterns of conduct, which channel it in one direction as against the many other directions that would theoretically be possible (Berger and Luckmann 1966, 72). According to Ronald Jepperson (1991), institutions represent a social order or pattern – or interaction sequences – that have attained a certain state or property, while institutionalization denotes the process of such attainment. An institution, then, is “a social pattern that reveals a particular reproduction process . … When departures from the pattern are counteracted in a regulated fashion, by repetitively activated, socially constructed, controls – that is, by some set of rewards and sanctions – we refer to a pattern as institutionalized” (1991, 145). Institutions should, therefore, be considered interaction sequences that are repeated regularly (routinized) and are socially controlled with rewards, as well as sanctions. William Scott (2001, 48–50) defines institutions as social structures that have attained a high degree of resilience. Social order and institutions are obtained through rules, norms, and meanings that arise in interaction and are modified by human behavior and the mobilization of resources. Scott relates rules, norms, and meanings to three “pillars” of institutions: regulative, normative, and cultural-cognitive. He suggests that institutions are transmitted by at least four types of “carriers”: symbolic systems, relational systems, routines, and artefacts. Symbolic systems refer to norms and values as well as symbolic schemata, including models, classifications, representations, and logics (2001, 78). Relational systems rely on patterned expectations connected to networks of social positions – that is, role systems. These systems constrain and empower the behavior of actors, and at the same time are reproduced and transformed by it. Rules and belief systems are coded into positional distinctions and roles reflecting cognitive typifications, as well as norms and rules. Institutions are 21


also assumed to be transmitted by structured activities in the form a habitualized behavior and routines. Routines rely on patterned actions that reflect the tacit knowledge of actors: deeply ingrained habits and procedures based on inarticulate knowledge and beliefs (Scott 2001, 80). Finally, institutions are transmitted through material culture and artefacts. Artefacts may be associated with, as well as affected by, the rules, norms, and meanings of the three pillars of institutions. It is clear from the above discussion that the theorization of institutions and their relation to routines has varied over time. In more recent attempts, researchers like Scott (2001) have started including material artefacts more explicitly in their conceptualization of institutions. Neoinstitutionalists like Lawrence and Suddaby (2006) suggest that actor-network theory, which emphasizes the human, as well as material, aspects of building macro-actors (e.g., institutions) is one theoretical approach that will further enrich the study of institutional work in the future. Furthermore, institutional and more practicebased perspectives on organizing and change, like actor-network theory, are increasingly being combined in order to understand the microprocesses on which institutional orders are built and changed. In their recent work, Martha Feldman and Brian Pentland (2005) show how organizational routines may be theorized, applying an actor-network perspective on routines. They (2005, 91) define organizational routines as “repetitive, recognizable patterns of interdependent actions, carried out by multiple actors.” They suggest that the construction of social order in organizations, as well as organizational fields, is based on routines. Certain situated actions or performances (i.e., routines) are related to a narrative, which suggests that these activities fit together in a way that is natural and may be taken for granted. The narrative both enrols and guides the performance. A routine is, therefore, theorized as an actor-network that consists of people, their performances, and supporting artefacts held together by a narrative about the routine. Nonhuman actants, such as written standard operating procedures, forms, and technologies, may exert influence over the development of a routine, and may also be influenced by it. Organizational routines are associated, via organizational and field narratives, and are seen as the building blocks of both organizations and organizational fields. Routines (and through them organizations and organizational fields) become powerful as a consequence of an association of elements, or actants, such as those mentioned above. Continuous change becomes the norm, and stability is an exception that must be explained. What 22

Introduction

has to be explored and explained are the network building activities of actors who – by assembling actor-networks, as well through the work of existing actor-networks – make routines. Through these activities organizations and organizational fields become possible, as well as powerful. Contributions Related to this Theme Niels Christian Nickelsen asks: What is the role of materiality in the institutionalization of an organizational routine? He suggests that neoinstitutionalists have either ignored, or given only a minor role to, materials and objects in the making of organizational routines. In his empirical analysis of the moulding of a rubber valve at AVK Gummi A/S he shows, however, that materials do seem to play a role in the making of organizational routines. By applying actor-network theory, and a symmetric approach to the analysis – which allows that both humans and nonhumans may play a role in the making of organizational routines – he highlights in more detail what role humans as well as nonhumans played in the making of organizational routines related to the production of the rubber valve. He concludes that routines may be reconceptualized as strong, performative, and stabilized programs of human and nonhuman allies, and that they are the effects of translation and negotiation among coalitions. He then calls upon neoinstitutionalists to develop a higher degree of empirical sensitivity. They should develop concepts that reveal, in more detail, what is currently only vaguely conceived of as “physical mediation” or “material circumstances.”

Institutionalism Compared to other Metaphors of Change In the Medici Effect, Frans Johansson (2004) explains how the Medicis – a wealthy banking family in Florence – contributed to the creative ideation of sculptors, scientists, poets, philosophers, financiers, painters, and architects in the city of Florence during the Renaissance. The family funded different actors from a wide range of disciplines, who in turn met and exchanged ideas, which contributed to a creative learning process fostering a multitude of new and innovative ideas. Based on this example, Johansson suggests that one may construct extraordinary new ideas by stepping into an intersection of fields, disciplines, and cultures. Neoinstitutionalist research supports this notion. Neoinstitutionalists, as well as other researchers, may have difficulties changing their own ideas, which have become institutionalized and taken for granted. 23


Change is, however, possible if embedded actors (in this case researchers) (a) activate their ability to perceive alternatives, (b) expose themselves to multiple logics in heterogeneous fields (Seo and Creed 2002), (c) become embedded in multiple fields (Schneiberg 2002), or if they (d) locate themselves at the interstice (overlap) between fields (Morrill, forthcoming). According to Boxenbaum (2005), Calvin Morrill (forthcoming) proposes that the interstitial emergence of ideas occurs as individuals who are located at an interstice combine elements from overlapping fields in novel ways. Accordingly, institutional researchers are increasingly combining insights from different research and theoretical areas in organizational studies, in order to enrich and develop institutional analysis and theory.They combine institutional theory with discourse analysis, actor-network theory, social movements theory, practice theory, and semiotics (Lawrence and Suddaby 2006; Lounsbury 2003; Ventresca and Mohr 2002). The contributors who address this theme combine or compare institutional theory with innovation theory, implementation theory, evidenced-based theories about effective interventions, and theory about change management, organizational ethics, and value-based management. Contributions Related to this Theme Lars Fuglsang asks: Is innovation in public organizations best understood as entrepreneurial, institutional, open, or strategic-reflexive? He focuses his question on how innovation is being handled in the Danish public library system. The idea that the libraries are changing only slowly and reluctantly is challenged by another more proactive and empirically based view on innovation and change. Fuglsang discusses four frameworks that differently theorize innovation and change: entrepreneurial, institutional, open, and strategic-reflexive innovation. He concludes that the Danish library sector has become an interpretative organization that interprets innovation opportunities and acts proactively in order to innovate. The innovation process has changed from institutional to open innovation. The old library mission emphasizing democracy and enlightenment has been replaced by a new one emphasizing the information needs of the knowledge society. The organization has changed from a planning organization, where things were planned in detail top-down, to an interpretative organization that mobilizes and intervenes with practices. The innovation process is characterized by strategicreflexive innovation, balancing means and goals through strategic interference and reflexive involvement of employees and skills. Partnerships between libraries 24

Introduction

and librarians are, in fact, important for the innovation process. Fuglsang points out that difficult negotiations between goals and means, strategy and reflexivity, top-strategic planning and entrepreneurship, are the most crucial issues to be addressed under the conditions of open innovation in the public library sector. Jacob Dahl Rendtorff asks: How can theories about change management be crossfertilized and developed using institutional theory and theories about organizational ethics? He suggests that a change has taken place in organizations in postindustrial society from hierarchy, rules, and stable structures to dialogue, values, and demands for flexibility. He explains that values-driven management combines economic concerns with concern for human values and the need for collaboration and integration. Values-driven management also makes an organization more flexible in its relationships with internal, as well as external, interest groups. Rendtorff interprets values-driven management as a response to demands for change in society, as well as an approach that makes it possible to cope with legitimacy, action, and change in corporations. Values-driven management, in the form of triple bottom lines and corporate social responsibility, is related to companies’ attempts to create social acceptance of their actions by conforming to democratic principles of freedom and justice, so that they become more culturally embedded in society. John Damm Scheuer asks: What kinds of metaphors about organizational change are utilized by doctors, new institutionalists, and researchers of public policy and administration doing research in change in healthcare and public organizations? What kinds of problems have they encountered trying to explain change in such organizations? He takes his point of departure in the fact that new innovative ideas are continuously introduced in order to change healthcare organizations in Denmark, as elsewhere. Consequently, healthcare and other professionals are often asking themselves how to introduce these ideas effectively. When asking such questions, professionals often turn their attention toward science in their search for answers. This led Scheuer to analyze the work of three different communities doing research related to healthcare and public organizations. Based on his analysis, he concludes that each of these communities ground their research with a different metaphorical understanding of organizational change – as intervention, implementation, and translation. He also finds, that while some 25


evidence about the nature of organizational change exists, it has turned out to be difficult to reach clear conclusions about the nature of, and the cause and effect relationships related to, organizational change in all of these communities.

Theoretical Questions Related to Institutional Change In the concluding chapter, Steen Scheuer sums up the contributions of this volume by focusing on three main issues of neoinstitutional theory and change: calculus versus culture, morphogenesis versus morphostasis, and rational choice and the Collective Action Paradox. The questions surrounding calculus versus culture are related to the conflicting views of economists and sociological institutionalists regarding human behavior and motivation. In rational choice and economic theory, human actors are seen as acting rationally and in accordance with their self-interests. In early formulations of new institutional theory, human actors were seen rather as acting on the basis of culture in the form of macrolevel abstractions made of taken-for-granted scripts, rules, and classifications. Steen Scheuer suggests and discusses another actor model that rejects such simplistic assumptions about human motivation and behavior. In his discussion of morphogenesis versus morphostasis, he focuses on the dialectics of change and stability, as well as questions related to the dialectics of path shaping and path dependency. In relation to rational choice and the Collective Action Paradox, he examines how rational and normative criteria interact with one another in ongoing social interaction. Regarding the Collective Action Paradox, he discusses that it is always more advantageous for individuals not to contribute to collective action regardless of what others do and regardless of whether only a few, several, or the majority contribute (Elster 1989). Finally, Scheuer reflects on how the contributions to this volume relate to these and other prominent issues in neoinstitutional theory.

References Berger, P. L., and T. Luckmann. 1966. The social construction of reality: A treatise in the sociology of knowledge. New York: Penguin Books.

26

Introduction

Boxenbaum, E. 2005. Institutional genesis: Micro-dynamic foundations of institutional change. Ph.D. diss., Copenhagen Business School. Campel, J. L. 2004. Institutionel forandring og globalisering. Copenhagen: Akademisk Forlag. Czarniawska, B., and G. Sevón. 1996. Translating organizational change. Berlin and New York: Walter de Gruyter. Czarniawska, Barbara & Bernward Joerges (1996): Travels of ideas in: Czarniawska, Barbara & Guje Sevõn (1996): Translating Organizaitonal Change, Walter, de Gruyter, Berlin/New York, 1996. DiMaggio, P. J., and W.W. Powell. 1991. Introduction to The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 1-38. –––. 1983. The iron cage revisited: Institutional isomorphism and collective rationality in organizational fields. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 63-82. Dobbin, F., J. R. Sutton, J.W. Meyer, and R.W. Scott. 1993. Equal opportunity law and the construction of internal labor markets. American Journal of Sociology 99:396-427. Elster, J. 1989. The cement of society: A study of social order. Cambridge, U.K.: Cambridge University Press. Feldman, M., and B. Pentland. 2005. Organizational routines and the macroactor. In Actor-network theory and organizing, edited by B. Czarniawska and T. Hernes. Copenhagen: Liber, Universitets Forlag, and Copenhagen Business School Press.

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Friedland, R., and R. Alford. 1991. Bringing society back in: Symbols, practices, and institutional contradictions. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 232-263. Giddens, A. 1984. The constitution of society: Outline of the theory of structuration. Cambridge, Mass.: Polity Press. Greenwood, R., and C.R. Hinings. 1996. Understanding radical organizational change: Bringing together the old and the new institutionalism. Academy of Management Review 21:1022-54. Jepperson, R.L. Institutions, institutional effects, and institutionalism. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 143-163. Johansson, F. 2004. The Medici effect: Breakthrough insights at the intersection of ideas, concepts and cultures. Boston, Mass.: Harvard Business School Press. Latour, B. 1986. The powers of association. In Power, action and belief: A new sociology of knowledge? by John Law. London: Routledge and Kegan Paul. Lawrence, T.B., and R. Suddaby. 2006. Institutions and institutional work. In The SAGE handbook of organization studies, edited by R.S. Clegg, C. Hardy, T.B. Lawrence, and W.R. Nord. London, Thousand Oaks, New Delhi: SAGE Publications, 215-254. Lounsbury, M. 2003. The problem of order revisited: Towards a more critical institutional perspective. In Debating organization: Point-counterpoint in organization studies, edited by R. Westwood, and S. Clegg. Boston, Mass.: Blackwell Publishing. Lounsbury, M., and M. Ventresca. 2003. The new structuralism in organizational theory. Organization 10 (August) 3:457-480.

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Introduction

Meyer, J.W., and B. Rowan. [1977] 1991. Institutionalized organizations: Formal structures as myth and ceremony. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 41-62. Morrill, C. Forthcoming. Institutional change through interstitial emergence: The growth of alternative dispute resolution in American law, 1965-1995. In How institutions change, edited by W.W. Powell and D.L. Jones. Chicago: University of Chicago Press. Pollit, C. 2001. Convergence: The useful myth? Public Administration 79(4):933-947. Poole, M. S., and A.H. Van de Ven. 2004. Theories of organizational change and innovation processes. In Handbook of organizational change and innovation, edited by M.S. Poole and A.H. Van de Ven. Oxford: Oxford University Press. Powell, W.W. 1991. Expanding the scope of institutional analysis. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago and London: University of Chicago Press, 183-203. Ruef, M., and W. R. Scott. 1998. A multidimensional model of organizational legitimacy: Hospital survival in changing institutional environments. Administrative Science Quarterly 43: 877-904. Røvik, K.A. 1998. Moderne organisasjoner: Trender i organisationstenkningen ved tusenårsskiftet. Bergen, Norway: Fagbokforlaget. Scott, W.R. 2001. Institutions and organizations. London, Thousand Oaks, and New Delhi: SAGE Publications. Scott, W. R, P. Mendel, and S. Pollack. Forthcoming. Environments and fields: Studying the evolution of a field of medical care organizations. In Bending the bars of the iron cage, edited by W. W. Powell and D. Jones. Chicago: University of Chicago Press.

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Scott, W.R., M. Ruef, P. Mendel, and C. Caronna. 2000. Institutional change and health care organizations: From professional dominance to managed care. Chicago: University of Chicago Press. Seo, M. G., and W.E.D. Creed. 2002. Institutional contradictions, praxis, and institutional change: A dialectical perspective. Academy of Management Review 27(2):222-247. Schneiberg, M. 2002. Organizational heterogeneity and the production of new forms: Politics, social movements, and mutual companies in American fire insurance, 1900-1930. Research in the Sociology of Organizations 19:39-89. Strang, D., and J.W. Meyer. 1993. Institutional conditions for diffusion. Theory and Society 22: 487-512. Ventresca, M.J., and J.W. Mohr. 2002. Archival research methods. In Companion to organizations, edited by J.A.C. Baum. Oxford: Blackwell Publishing, 805- 828.

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Section I CHANGING ORGANIZATIONS

Chapter 2

Interpreting the Means and Goals Innovation in Danish Public Libraries By Lars Fuglsang

Introduction Innovation can be understood as an interactive process (Lundvall 1988) that is socially distributed, and that involves a multitude of changing actors, across sectors and employees at many levels. Innovation is, therefore, not an activity that is restricted to scientists or technologists working in departments of research and development, people belonging to the so-called creative class (Florida 2004), or advanced “symbol analysts,” as they are described by Reich (1991). It is a more common activity that produces contingencies for many people in an organization. How can organizations relate to these contingencies and involve employees in these changes? I argue in this paper that innovative organizations sometimes function as interpretative systems (Daft and Weick 1984; Fuglsang and Sundbo 2005). They try to create some order and integrate people into changes by interpreting their skills, as well as the purpose of the organization, and by looking at how skills and purpose can be adjusted to each other. The interpretative organization is different from the classical planning organization. In the planning organization, the course of action is more given, the skills more fixed and the activities are planned and managed in a more detailed way. Furthermore, in the planning organization, we can assume that there is already coherence between skill and purpose, which is built-up over time. For the interpretative organization, the most difficult task today is perhaps to create some kind of coherence between skill and purpose, or – in other words – to avoid anomies as a result of inconsistencies between means and goals (Merton 1938; Durkheim 2002).


The paper examines a case study of innovation in the public sector.1 Partly drawing on a critical incident technique (Flanagan 1954; Fuglsang 2007), it explores how innovation is being handled in the Danish public library system as a whole. Critical incident technique is an action-oriented method that can help the researcher to identify core incidents that have had a positive or negative impact on a given situation. In this paper, the method is mainly used to structure the data from a variety of sources. Four frameworks for innovation and intervention into changes are discussed: entrepreneurial innovation, institutional innovation, open innovation, and strategic reflexive innovation. In this paper, I argue that the public library has always been innovative, but that the framework for innovation is changing from institutional to open and strategic reflexive innovation.2 This is especially due to the advent of the Internet. This shift has led to more contingencies on the one hand, but also, on the other, to proactive reinterpretations of the library and its role in society. What are the implications of this approach? First, it seems crucial that employees, here the librarians, see themselves as part of an interpretation framework that can proactively handle contingencies, and can create and maintain certain patterns of development. Looking specifically at the experience of Danish libraries, it seems essential in this process to be able to take care of the relationship between existing skills and new purposes. Libraries do not have to give into the new contingencies. To be able to develop the purpose from the skills, rather than the other way round, can be crucial for many organizations.

Interpreting Means and Goals in the Library The public sector is often seen as bureaucratic and organized into silos with walls in between, and little communication across the various organizational units (Koch and Hauknes 2005). Studies of change processes in the public sector often focus on imitations, isomorphism, and decoupling effects, hence they describe a reactive mode of innovation, rather than innovation as a more distinct and proactive process (Meyer and Rowan 1977; DiMaggio and Powell 1983; Røvik 1998). Consequently, the public sector is believed to be a relatively stable environment that is not very responsive to innovation and other 1 2

For the case-study report, see Fuglsang 2006. For another discussion of this topic, please see Fuglsang 2007.

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Interpreting the Means and the Goals

contingencies. Public organizations either seek to protect themselves from external contingencies or they eventually give in to them. Most of this literature seems to confirm that even if the public sector is changing, it changes only in a very conservative and reluctant way. Nevertheless, competition has entered into the public sector, including public libraries. In the case of public libraries, this is due first and foremost to the Internet and the myriad available search machines, which enable users to download all kinds of material directly from the content provider. Users also gain access to daily updated information and entertainment that is provided by the broadcasting companies, newspapers, through social network technologies, as well as by other organizations in the public sector. Partly as a result of these technologies, new trade agreements have been implemented, some of which cause problems for libraries (Rikowski 2005). Public libraries have, therefore, been forced to rethink or reinterpret their role. They have to relate to the new situation in order to survive.3 Innovative organizations do not always adopt external changes in a reactive manner: however, in order to be proactive, managers and employees need to interpret opportunities in certain ways and try to maintain particular active patterns. In the case of the Danish public library system, it is anchored in a social movement, the library cause, with a strong cultural legacy of more that 100 years. This movement has been institutionalized in various ways in Danish society, but it still exists as a resource inside the library system and provides a strong starting point for interpreting new opportunities. The library cause has traditionally put democracy and enlightenment at the center of their mission. This mission is still being maintained along with an additional goal: to support the development of citizens’ competence in the emerging knowledge society. The library sector is trying to formulate a new strategy in which the traditional library skills become, in part, relevant for new purposes. This is not to say that the traditional library cause is disappearing entirely, but rather adapting to a new context. This process of adaptation point in the direction of what I call a strategic reflexive approach to innovation.

3

I believe the Danish public libraries have been able to respond to the new contingencies in a proactive way. In seeking to explain these actions, this paper presents a model of innovation that argues, drawing on the work of other innovation theorists (Lundvall 1988; Lundvall 1992; Nelson 1993; Leydesdorff 2000), that innovation is increasingly an interactive process involving many and changing actors.

35


The Critical Incident Technique Flanagan, the inventor of this technique, describes it as follows: The critical incident technique consists of a set of procedures for collecting direct observations of human behaviour in such a way as to facilitate their potential usefulness in solving practical problems and developing broad psychological principles. The critical incident technique outlines procedures forcollecting observed incidents having special significance and meeting systematically defined criteria (Flanagan 1954, 327). Flanagan emphasized best practice and quantification of the date in the form of reported incidents. He used the method to analyze critical requirements for success or failure in a given situation. The most quoted example is the impact of dizziness (or the ability to handle dizziness) for flight crew performance. The discovery of such critical requirements in a given situation can lead to proposals for training and recruitment of personnel and improvement of technology (for example in the cockpit). Furthermore, Flanagan’s original method implies that a large number of incidents are collected from a variety of people who are familiar with the situation in question (e.g., flight crew personnel). My application of the method is more similar to that of Chell (1998). Chell uses the method to explore incidents, as they are perceived by respondents, not only as hard ontological facts but also as perceptions of problems and intentions, or strategy. Along these lines, the method is used here to explore how incidents and events of innovation are conceptualized. The purpose is to examine how innovation is understood and organized in the context of the public sector, assuming that the conzeptualization of innovation rather than innovation itself is a key. Furthermore, while the method is used both by Chell and Flanagan to collect data from a large amount of interviewees, this study uses data collected mainly from documents and a few key people whose ideas are already credited as successful.4

4

Interviews were conducted with a vice-director of the Danish National Library Authority, with a department head in the Danish Bibliographic Centre, and a project initiator and project developer of the Library Watch.

36


Four Modes of Innovation and their Emphasis on Means and Goals As mentioned previously, this paper distinguishes between four modes of innovation, which are derived from the literature on innovation: entrepreneurial innovation, institutional innovation, open innovation, and strategic reflexive innovation. Each of these modes of innovation have specific historical roots, but they could also be seen as structures of action that are simultaneously present today in the innovation society. Actors can move back and forth between them and take different positions at different times. They are not exactly roles in the convention of role theory, but rather positions or motivational states that people can rely on in a dynamic way (Harré and Moghaddam 2003). Each of these modes places different emphasis on interpretation and the integration of means and goals. Some pay strong attention to goals while others pay stronger attention to means. Furthermore, some are proactive and some reactive. The strategic reflexive mode is arguably the most important today because it seeks to integrate interpretations of means and goals, and lays particular emphasis on the organization as an interpretative system that can intervene proactively in contingencies. Entrepreneurial Innovation An entrepreneur can be understood as a dynamic and creative person that can make a difference by generating social or economic value. In the literature on entrepreneurship, various approaches to entrepreneurship can be found. Two important approaches are those of Schumpeter and Kirzner. The Schumpeter entrepreneur undertakes a creative-destructive role (Schumpeter 1969), and the Kirzner entrepreneur is someone looking for market failures to be corrected (especially information problems concerning prices). By correcting these faults the entrepreneur can earn a profit, while also correcting coordination problems in the market (Kirzner 1973). The task of the entrepreneur is to generate value for himself and for society. The value can be economic or social, in which case we speak of social entrepreneurship. What is the motivation behind entrepreneurship? In a very general sense, the motivation behind entrepreneurship is not necessarily profit, even though profit can be an important incentive. Entrepreneurship is also motivated by creativity: the attempt to break rules, pave new ways, find new solutions, reposition oneself in life, or create something new. This is consistent with 37


Schumpeter’s vision of the entrepreneur as someone who wants to create a private kingdom, prove themselves, or enjoy the process of creating something (Schumpeter 1969, 93). This kind of entrepreneurial motivation is, in a sense, an essential part of life itself, but it can, depending on the context, be more or less restricted, even though it cannot be completely eliminated. In the public sector as well as in large organizations, we usually think of entrepreneurship as something that is highly restricted. Too much entrepreneurship would undermine the working routines of such organizations and the authority of their leaders. Nevertheless, in some cases, entrepreneurship can be supported in public organizations, for example, by allowing entrepreneurial career patterns and giving emotional support to creative people. In these cases, the entrepreneur would usually have to be tied to a particular purpose, and the success of entrepreneurship would depend on whether this was possible. In the case of entrepreneurship, the interpretation of goals and purposes can play a stronger role than the interpretation of skills. The Schumpeter entrepreneur is described as someone who destroys old habits and creates new ones, while the Kirzner entrepreneur is oriented towards external faults in the market to be corrected. In both cases, focus is supposedly on what is to be achieved, whereas the skills or the habits are something that has to follow from the goal. Furthermore, the entrepreneur is often working on an individual basis. Interpretations are not really linked to pre-existing routines or organizational structures. The entrepreneur defines the organization, its goals and routines, rather than the other way round. Entrepreneurs are like Napoleon’s soldiers: a new generation of people who, not constrained by old habits and power structures from the past, are able to pursue new goals. The danger exists, of course, that skills and social experiences will be destroyed and lost. Institutional Innovation This approach, as it is presented here, can be described by referring to socalled institutional theory (Scott 1995; Meyer and Rowan 1977; DiMaggio and Powell 1983; Røvik 1998) as well as the theory of technological change (Nelson and Winter 1977, 1982; Freeman and Perez 1988). In both of these approaches, the path-dependency of actors and their routines are described as important phenomena that constrain actions. Changes in the institutional and technological environment will occur for various complex reasons. This will put pressure on organizations to change. In the institutional approach, and thus in institutional innovation, there is a strong emphasis on the way in 38


which people respond to these pressures by seeking to remain within traditional boundaries as much as possible. Institutional theory attempts to show how institutional structures influence and stabilize organizations through the institutionalization of norms, rules, and cognitive structures (Scott 1995). In periods of institutional or technological change, organizations often remain true to previously institutionalized routines. Indeed, people also have professional and economic interests in preserving these routines. In the literature on institutional theory, change processes are sometimes described as recipes or rationalized myths travelling from the institutionalized environment into the organization. This travel is not unproblematic and the recipes are transformed to something else during the process. Sometimes a decoupling effect can be described, whereby organizations only superficially pretend to act in accordance with the new recipes (in order to save face), while in practice, they continue to pursue the same old routines as before. This explains why, on the one hand, organizations become more similar: They are all confronted with the same recipes, which they – at least superficially – try to adopt in a reactive manner. On the other hand, it shows how organizations transform these recipes. In a complicated way, they “translate” them into local practice through some kind of calculation of advantages and disadvantages. The position of goals and means is different compared to entrepreneurial innovation. In this approach, the means and the pre-existing norms and routines play a much stronger role, while changing goals are interpreted more sceptically. Means, routines, and roles are seen as institutionalized over time – through education and employment – and come to have a strong hold on workers. They are difficult to unlearn and constitute, therefore, a barrier to change. Norms and routines are the starting point for institutional innovation. In the extreme, it deals with interpreting how stability rather than innovation can be achieved. Open Innovation The concept of open innovation originated from Chesbrough (2003) and also von Hippel’s work concerning the impact of advanced users on innovation could be mentioned (2005). Open innovation represents a more chaotic and flux-like situation where the boundaries of organizations are more porous, subject to contingencies, and where planning becomes more difficult. It arose from the growing distribution of innovative resources throughout society. Previously, innovations started principally in large research laboratories where they were carefully 39


planned. But the situation is changing with the advent of multiple spin-offs from research laboratories, the increasing impact of service firms on innovation, combined with the growing level of education in the population, as well as the apparent growing impact of advanced users on innovation. Innovative resources become extensively dispersed throughout society and innovations can come from many, often surprising, places. This requires a new level of vigilance from companies and organizations. Some years ago organizations could remain focused on their core competencies (Prahalad and Hamel 1990), i.e., their internal resources and resource planning. Today, they have to engage in a sort of poker game (Chesbrough 2003) and take into account or read all the stakes and inputs from the many new external, and partly unknown and often irritating, innovative sources, and then combine them with internal resources. The motivation behind open innovation is to stay competitive (and to survive). Compared to institutional innovation, management plays a stronger role, since it becomes important to take into consideration many different sources of innovation. Professional staff can, however, also be important because of their relationships (i.e., professional networks) and ability to read what is going on (i.e., judgement power). Another important concern is how users or customers can be better exploited as sources of innovation, though how this can be accomplished is still an open question. One route is to focus on advanced users that are able to solve practical problems in an innovative way (von Hippel 2005). Another route is to make ethnographic studies of the users in their living environment to uncover needs that have not yet been satisfied (Rosted 2005). Like institutional innovation, open innovation is reactive, but it is more extroverted – following external trends – and is less protective. The game of poker is its model, which means that assumptions about an environment cannot be analyzed in a straightforward way; rather, there is a premium on interpretation. In open innovation, interpretation is mainly aimed at goals (i.e., detecting trends and megatrends on the market or important solutions to a problem) that can be discovered by scanning the market and the users.

Strategic Reflexive Innovation In this approach, playing poker is insufficient. External inputs have to be carefully transformed into various forms of organizational skill and put into a local context (Sundbo and Fuglsang 2002; Fuglsang and Sundbo 2005). External 40


inputs are still important, but the organization is seen as an interpretation system (Daft and Weick 1984) that seeks to intervene into contingencies. Following the tradition of actor-network theory, we may also say that the organization attempts to translate inputs from the external environment into something useful or meaningful at the organizational level (Callon and Latour 1981), but the organization also puts these translations back into the environment.5 The interpretations are strategic in the sense that they point to certain options and goals. They are also reflexive to the extent that these goals are reflected upon inside the organization by managers and other employees who relate them to an elaboration of pre-existing skills. Like institutional innovation, strategic reflexive innovation is trying to create order and stability, despite the recognition that the world is contingent. Compared to open innovation, strategic reflexivity is a more active approach seeking to shape answers (Daft and Weick 1984) rather than detect them externally. Strategic reflexivity is really a broad concept meant to describe the organization as an interpretative system in the most radical sense. It is a situation where both the means and the goals are interpreted, and where some kind of coherence between them is continuously attempted. From this small review, we can draw three tentative conclusions. Firstly, interpretation is crucial to innovation. Hence, it can be argued that interpretation plays a strong role in all four modes of innovation because of the flux-like character of innovation. Secondly, there is perhaps an historical shift from entrepreneurial to institutional to open innovation, with increasing emphasis on an interactive and organizational approach to innovation (to be distinguished from an individual approach). Finally, each framework emphasizes means and goals somewhat differently. Entrepreneurial and open innovation both have a strong emphasis on goals, whereas institutional innovation, by contrast, emphasizes the means (and in a stabilizing manner). We know from the sociological literature (Merton 1938; Durkheim 2002) and from the more recent literature on flow experience (Csikszentmihalyi 1997; Fuglsang and Sundbo 2006) that too much emphasis on goals at the cost of means is basically unhealthy and frustrating, causing a feeling of stress or even anomy and leading to deviate behaviour (Merton). The concept of strategic 5

“ Sense-making” is another way of expressing some elements of this approach (Weick 1995), but sense-making is here infused back into the context.

41


reflexive innovation as presented here is really an ideal type for a situation where more attention is given to the means and the goals in combination, and how they can be adjusted to each other in a proactive way.

The Case: Danish Public Libraries We can discern three phases in Danish library development, from institutional innovation to entrepreneurial innovation to open innovation. Libraries in Denmark were initially driven forward by the so-called bibliotekssagen (library cause), even if this term was not used officially in Danish law after 1923. The library cause was a social movement that argued for the necessity of libraries for Danish education and democracy (see Lange 1909). It was viewed as a manifestation of the Enlightenment project and had broad support in society. According to the library cause, libraries had to be organized according to certain common standards and rules; thus, initially, the goals and the means of Danish library development were highly institutionalized and relatively unproblematic. During the 1970s, libraries became more individualized (Dyrbye et al. 2005, 9–37) and entrepreneurial. For example, alternative forms of literature came into focus (e.g., working class and feminist literatures), single libraries sometimes developed their own profiles and ideas, and during the 1980s entertainment, relaxation, and self-realization were also more stressed as legitimate endeavors in their own right. This led to a sort of a deinstitutionalization of the library cause. A new era of open innovation started during rise of digitization in the 1990s. Several events tooks place to prepare the library for open innovation; • The Danish Bibliographic Centre (DBC) was reformed in 1993 • The Danish National Library Authority was restructured in 1997 • A white paper on libraries in the information society was published in 19976 • A new Library Act was finally passed in 2000, which requested that libraries expand their activities to include electronic media Over a ten-year period from 1994 to 2004 the library situation changed in

6

S ee Udvalget om bibliotekerne i informationssamfundet. 1997. Betænkning om bibliotekerne i informationssamfundet, Betænkning nr: 1347. København: Kulturministeriet.

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many related ways, demonstrating the growing role of external ideas and open innovation for library development. The composition of the materials available in the libraries is still changing. Expenditures on books has fallen by 28 percent, while expenditures on other materials (e.g., CDs, DVDs, etc.) has increased by 60.2 percent. Library attendance is also somewhat different today than a few years ago: Between 1998 and 2004, the number of adults who attended a library once every month fell from 35 to 29 percent (Andresen, Madsen, and Hansen 2005). A small group of super-users seems, however, to be using the library more, especially due to the advent of the Internet and the possibility of using library computers for various other purposes. Borrowing habits are also changing with the introduction of new e-based self-services. (All public libraries have acquired publicly available Internet access.) From 1999 to 2004, the overall number of leant materials increased by 2.4 percent, while the actual number of loans fell by 13.3 percent. In the same period, the number of renewals of loans increased by 139.5 percent (most likely because people can now renew loans from their personal computers). The so-called interurban loan among libraries increased by 74.6 percent from 2000 to 2004. This was due to a new service, bibliotek.dk, which made it possible for users to order books from any Danish library using their home computers, and to pick them up at their preferred library in a few days. The digitization of Danish libraries was perceived throughout much of the library sector as a new joint project that could give their institutions a new profile and the librarians a new role in society (Dyrbye et al. 2005, 37). Perhaps we can metaphorically speak of the “new library cause” with more emphasis on open innovation, entrepreneurship, as well as user competencies in the knowledge society. In 2006, the director of the Danish National Library Authority expressed the following views to a Danish news magazine: Libraries have been static institutions, which have stored and kept knowledge. Citizens and companies have addressed themselves to the libraries to get this knowledge. Today, it is clear that we, as a nation, do not make use of this knowledge base to the maximum, even if access to knowledge and the ability to use it have become crucial parameters of competition. Therefore, the issue is now how to develop the libraries into becoming extrovert knowledge networks that can help citizens and especially companies with knowledge whenever they need it… .The goal is for libraries in the future to provide easy access to relevant 43


information in the work situation just like waterworks provide clean water in the tap. Being first and best for this job, the libraries can become a comparative advantage for companies in international competition … (Lindholm 2006). The new library of open innovation and entrepreneurship had to be organized differently. Libraries became incorporated into a concern-like structure with more emphasis on top-strategic management. Most importantly, the Danish National Library Authority became an institution under the Ministry of Culture. This institution had earlier been called the National Library Service but the name was changed in 1997 in response to the growing requirements of open innovation. The director wrote: The change of name from ‘service’ to ‘authority’ clearly meant that the institution was the Ministers’ agency, and that the task was to carry out state policy and carry out the administration related to it, and not the opposite: to be the libraries’ lobby-organization vis-à-vis the Ministry (Nielsen et al. 2005, 439). Today the Library Authority is an important player that can combine external ideas with internal, entrepreneurial ideas. It even administers a fund that provides financial support for entrepreneurial ideas that come out of the libraries. The Library Authority is also responsible for setting up the framework of the bibliotek.dk, and supports the so-called net-libraries through a specific fund for activities across libraries. The net-libraries are entrepreneurial projects initiated by local libraries often in collaboration among each other, and they create what could be called new entry-points for users, which may help to prevent users from exiting the library all together. The libraries themselves create the net-libraries, often in cooperation. One example of this kind of collaborative entrepreneurship and open innovation is the Library Watch, which will be described in more detail in the next section. The DBC is the company that develops some of the most important new digital services for the Library Authority, including bibliotek.dk. DBC is also implicated in interpretations of the new library cause and open innovation. An article in DBC Avisen, Winter 2005, discussed why the future librarian is: Much more than an elderly lady with an amber chain that wears her hair in a knot at the back sitting behind the counter … The Internet floods modern society with information. This increases the need for information experts who 44


can navigate in the information jungle, make quality assessments, facilitate self-help, teach search techniques, and source criticism. The libraries have, by themselves, adopted the Internet as a channel of communication and they take active part the intermediation of culture. The Danish Union of Librarians call themselves the ‘Union of Information Specialists and Cultural Intermediaries’ and wants, with its new chairman in charge, to kick in the door to private companies and municipal politicians, and tell them in broad terms that the librarian is attractive and indispensable. The profession has become multifarious and the borderlines of the profession more blurred. The Royal School of Library and Information Science educates generalists that can undertake jobs as researchers, caseworkers, webmasters, and IT-consultants in private and public firms … The library of the future is a hybrid between an open learning center, a public service center, and a local cultural institution. In the hybrid library, the librarian changes her role and function, and becomes a consultant, instructor, or information guide. She is not necessarily educated as a librarian. … The future librarian is proactive, extroverted, and ready for changes, and is good at selling herself and creating her own job. The Library Association is another organization that also seeks to reinterpret the library cause. The Library Association traditionally fights for “the free, open, democratic society with free and equal access to information and culture for all” and for “the defence of democracy by making public libraries and the library sector as a whole an important actor that can help ensure that the whole of the population has free and equal access to all information” (from the Library Association’s Strategy Plan 2006–2010). But the association is also starting to look out for a new library cause with more open innovation and entrepreneurship. On its centennial anniversary, the association published The Strong Public Library, written by researchers from the Library School. The book describes, among other things, the library cause and the history of the library from its traditional roots to its modern hybrid form. The book contains a number of very nice illustrations, which in a sense describe an evolution from a somewhat boring, silent, partly unfriendly, and closed library to an exiting, lively, friendly, and open library. An example is the illustration on page thirty-seven. It is of a booklet from 1987 predicting “the fantastic library of the future.” The illustration shows a black and white photo of a librarian sitting at an elevated disk in 45


an old library characterized by a dreary quietness. He dreams of more lively times for the library’s future, pictured in a cartoon drawing of his thoughts, with many funny people, life, and full of new media. As well, the Danish Union of Librarians is seeking to promote a new and much more open role for librarians. The Union presents itself on its home page as “a union of information specialists and cultural intermediaries” (April 2006). The Union has tried actively to reformulate both its own and the librarian’s role. On the Union’s home page, under the heading “Librarians are the future’s information architects” the following discussion can be read: The Copenhagen Institute for Futures Studies is completely wrong when it predicts that librarians will not exist in ten to fifteen years. In Politiken [a Danish national newspaper], 10 January 2006, project leader Niels Bøttger-Rasmussen described how librarians in reality are a kind of “zombie,” because they, as a result of current developments, will soon have the future behind them. Pernille Drost, the chairman of the Union of Librarians, was very surprised by this statement: ‘The Institute of Futures Studies has just published a magazine where they focus on innovation ability in companies. Innovation requires knowledge, and knowledge does not come at random. Librarians have a sharp profile in knowledge management. The Union of Librarians works with user-driven innovation and the role of the librarian in that process. We can, with a few words, shoot down Niels Bøttger-Rasmussen’s claim that librarians will not exist in ten to fifteen years. User-driven innovation is about giving customers or users what they want before they know it themselves. Therefore, a special knowledge about customers is essential for user-driven innovation. This knowledge has to be collected, organized, and made accessible in an appropriate way, and it is in that respect that librarians become key players in the process. Today thirty-six percent of the candidates from the Library School are employed in private companies, where they facilitate knowledge and develop information architecture. The private as well as the public labor market works with user-driven innovation, and this is a condition for survival in many industries and services. There is a broad agreement about this, both politically and among companies in most Western countries. Information architecture is the core of the librarian’s competencies.

46


Niels Bøttger-Rasmussen seems to have a view of the librarian as being obsolete. Maybe he should update his knowledge in this area,’ says Pernille Drost (accessed January 10, 2005). We can conclude that the Danish library is introducing a new library cause with more emphasis on open innovation and entrepreneurship. It is also developing a new interpretation of its means and goals. The period of the 1970s and 1980s can be seen as one where entrepreneurial innovation played a certain role with many experiments going on in the libraries throughout the country. Since the 1990s, one can observe a new era, where entrepreneurship has become combined with open innovation, where digitization started to play a role, and competition from the Internet became a critical issue. During the 1990s and 2000s, libraries have also tried to create a more strategic reflexive approach to open innovation. For one thing, the library has been reorganized to become a more concern-like and top-strategic organization. This organization is not a planning organization, but a strategic organization that pulls together external and internal ideas, and it stimulates collaborative entrepreneurship involving local libraries and librarians. In addition to this, a lot of attention is given to the librarian’s skills, how these can be reinterpreted, and how libraries can become entrepreneurs in the new library cause.

The Library Watch: A New Entry-Point to Avoid User Exit One example of how the new library cause has created more emphasis on open innovation and entrepreneurship is the Library Watch.7 The Danish National Library Authority supports it as one of its high-profile net-libraries. The example is mainly based in an interview with a project developer (in the following called PD), and clearly shows that this service has developed as an entrepreneurial open project. It has a strong focus upon library skills and how these can be used and extended to serve the purpose of more open and user-friendly innovations. Library Watch is conceived as a free Internet-based information service. Users can ask questions to librarians through this service. This is done by filling in a form at the home page of the service, which is then sent on to a librarian,

7

See http://www.biblioteksvagten.dk/.

47


who returns an answer within twenty-four hours. Another possibility is to chat with a librarian in a chat room during Library Watch’s hours of operation. At the time of the interview (February 2006), forty-five public libraries, thirteen research libraries, and about 250 librarians cooperated through this service. Three entrepreneurial libraries created Library Watch. According to PD, the purpose was to develop a new role that would capitalize on the librarians’ skills for the libraries on the Internet. According to PD, for most of its history the library had a virtual monopoly on information, and citizens could not avoid it if they wanted access to knowledge and information. By the end of the 1990s, this monopoly was disappearing. For example, people now had access to Danish Acts and the Danish Parliament directly from their computer at home. “Libraries need to be on the Internet, onto which all the library users are gradually moving,” she says. Open innovation is clearly a premise behind Library Watch. To create Library Watch, a partnership was formed among librarians at three libraries in Herning, Silkeborg, and Gentofte. In the beginning, Library Watch was mostly seen as an organizational challenge for these libraries. They had to find a way to cooperate despite the distance between them and their distinctive institutional cultures. A common virtual workplace had to be constructed among the librarians that could function on a daily basis. The number of participating libraries has grown steadily. Eventually, research libraries were also included into the service. This meant that certain questions of a more specialized character could be sent on to librarians at specific research libraries, who had particular competencies in those fields. In 2000, an evaluation of Library Watch was carried out. One of the conclusions was that the cooperation among the libraries was important and successful. It was also clear that more libraries had to be added into the cooperation because of the popularity of the service. According to PD, three libraries and ten librarians can work together without detailed instructions, but for more libraries to participate, it was important to formulate more precise statements about the nature of Library Watch. Some rules of the game and procedures had to be established to make this possible. The partnership between many libraries makes it possible to create some flow in the service, which is necessary for the user to stay in the system (see also Fuglsang and Sundbo 2006). The librarians must seek to return an answer to the user within the promised twenty-four hours. The librarians can also share experiences and learn from each other’s answers to a particular type of ques48


tion. All answers given are kept in the system’s database, which can be browsed by the participating librarians. Again, openness and open innovation becomes an important philosophy behind the project. The boundaries between libraries and librarians are broken down. The service has also been further developed from user response. It turned out that the users were using the service in a different way than was first expected. When the service was started, it was expected that users would primarily use the service for reference questions, i.e. factual questions. But the users instead asked broad questions like “I have to make an interpretation of this or that novel in school. How can I find relevant materials and knowledge?” The users themselves solved factual questions by searching the Net. The librarians also changed their working style. In answering the users’ questions, they started to make use of all the materials they could find on the Net and to create links to these resources. The cooperation in Library Watch is managed from an internal home page. Here, all the questions users have asked and all the answers given by librarians are stored, as well as a manual with procedures and instructions, a duty roster and a description of the whole working concept. A watch plan has to be worked out to ensure a division of labor among the participating librarians during their working hours. In this way, librarian can also leave questions to each other according to the watch plan if they know that the next librarian in the line has special knowledge of a topic. The librarians also meet face-to-face. There is an introductory seminar for all new librarians in the service, and once a year a common seminar for all participating librarians is arranged. The librarians need to feel ownership of the service. They have to feel that the Library Watch is their working place, says PD. Librarians can give many types of answers depending on the question from users. PD gave some examples: I had one yesterday. She wanted material about the Danish media’s coverage of the Vietnam War. I wrote a long answer to her. In my answer, I had to make clear what it is she wants from me. I also had to tell her that no analysis of the Danish media during the Vietnam War exists. She needed to have a look at the newspapers, which she can get on microfilm. We do not have access to radio and television from so long ago. Another person wanted to know whether black currants existed during the Middle Ages, and if they were used as medicine. I found a book called People 49


and Flora in which I could see there is a section on black currants, though I did not provide a quote. So, my answer is that he probably he can find an answer in that book. There was also a person on the chat, a pupil from the eighth grade. She wanted to ask about the [Universal] Declaration of Human Tights. To this, I quickly found a link. Then she asked what happens when it is broken. I answered that there is not a clear answer. I gave her some more links where she can read about breaches of human rights. Then she asked me what the role of torture is in the Danish debate about refugees. This I cannot answer. Instead I gave her some advice and said that she has to think about this herself. But I gave her some links. The quality of the answers is an important issue. It is, however, a difficult issue. All librarians that participate in Library Watch can see and potentially make use of other librarians’ answers. The fact that the other librarians are potentially watching you becomes an indirect mechanism of quality control. An evaluation of all the given answers has been considered for the future. PD suggested that students from the library school could, for example, develop this into a project. Checking all the answers would, however, be a very timeconsuming task. Library Watch is a way to make use of, and reinterpret, library skills in a new way. Twenty-five years ago the job had very different content, says PD. If the user could not come up with a very precise question, then the librarian could not give an answer. Today, one almost never gives up. Many librarians experience their work as new and more exiting due to Library Watch, not the least librarians from small local libraries, says PD. Earlier, if you were employed in a local library, you would have a limited circle of users and a limited amount of materials at your disposal. In Library Watch, the librarian at the local library effectively becomes a librarian in a very big library with many and different users, many colleagues, and many materials at their disposal. “There are many librarians both old and young who are happy with this. You have a lot of feedback and a lot of colleagues to work with. You can really extend your horizon,” says PD. We can conclude that the Library Watch is a new way to deliver a library service within a framework of open innovation: It constitutes a new entrypoint for the library user to prevent him or her from exiting the library. Furthermore, the project-leader interprets Library Watch as a service that creates 50


an entirely new, much more open environment for the librarians, where library skills can be used and developed. In other words, Library Watch is understood to create some kind of link between the external ideas of digitization of the library and the internal skills and ideas of the librarians. Furthermore, Library Watch is based in a strong partnership and collaboration among the participating libraries and librarians.

Conclusions The following five broad events or incidents concerning innovation and change have been discussed in this paper: Firstly, the library sector is becoming an organization that interprets innovation opportunities, including its means and goals as well as their mutual coherence. New contingencies have emerged for the library, but rather than give in to them it has tried more actively to participate in open innovation, thus interfering with the contingencies and shape the answers. We see how it is possible to interfere with innovation at a more general level by formulating strategic interpretations, which relevant people in the organization can relate to. Secondly, open innovation has becomes more pertinent to the library as a framework for innovation. There is a change from institutional to open innovation. Open innovation becomes more crucial to the library due to the advent of the Internet. Open innovation means that the library alone cannot take into consideration internal resources and ideas for its development, but must take more external inputs into account, especially concerning the evolution of the Internet and users’ responses to it. Thirdly, libraries are responding to this situation by redefining the library cause. The old library cause mostly emphasized democracy and enlightenment while the new library cause attempts to create a framework whereby libraries can assist citizens in the knowledge society. In this context, the whole range of librarians’ skills is being reinterpreted to suit new purposes. What has been called strategic reflexivity, understood as the attempt to create a balance of means and goals through strategic interference and reflexive involvement of employees and skills, seems a reasonable way to characterize what has occurred in the library sector. Fourthly, these changes have involved the creation of a top-strategic organization that intervenes in library practices and supports collaborative en51


trepreneurship. A change has occurred from a planning organization, where everything is planned in detail, to an interpretative organization that mobilizes and intervenes with practices. Multiple projects and entrepreneurial initiatives can exist in this context (as long as they conform to the strategy). Library Watch is one example of this, where responsibility is delegated to a group of entrepreneurial librarians working within an overall framework of rules and procedures. This pluralistic approach is needed in order to create multiple entry-points for users into the library sector, and to prevent users from exiting the library altogether. Finally, partnerships inside the library sector between libraries and librarians is an important way to handle new contingencies. Partnership means that groups of people create long-term relationships in order to solve problems, share each other’s experiences, and exchange ideas and resources. What can we learn from the case study? Maintaining balance between goals and means, strategy and reflexivity, top-strategic planning and entrepreneurship is difficult. This is a crucial issue under the new conditions of open innovation, which also seems to affect the public sector.

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Scott, W.R. 1995. Institutions and organizations. Thousand Oaks, Calif.: SAGE Publications. Sundbo, J., and Lars Fuglsang, eds. 2002. Innovation as strategic reflexivity. London: Routledge. von Hippel, Eric. 2005. Democratizing innovation. Cambridge, Mass.: MIT Press. Weick, K.E. 1995. Sensemaking in organizations: Foundations for organizational science. Thousand Oaks, Calif.: SAGE Publications.

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Chapter 3

Organizational Change and Values-Driven Management A Perspective from Institutional Theory By Jacob Dahl Rendtorff

In organizations and companies, processes of change have become conditions of survival in post-industrial society. “Change or die,” as Tom Peters has said (Beer and Nohria 2000, 1). Companies are forced to search for innovative creativity – “creative destruction” as proposed by Schumpeter – in case they want to survive in the process of change. Governmental organizations and public offices are forced to follow the lead of the private sector if they wish to be perceived as useful and socially acceptable agencies. In this sense, change has become a key word for understanding modern business processes and organizational development. Organizations have to be open and sensitive to influences and interactions with different stakeholders. Management and leadership have become change management. Workers and employees are supposed to be flexible and ready for change; however, not all conceptions of change are positive. There seems to be a tension, one could even say conflict, between economic drivers and forces of change, and the human and organizational realities of their implementation. In many processes of change managers have to ask questions like “What are the appropriate conditions of change?” and “How should we conceive these conditions?” This is because change is often imposed on organizations from the outside. Political, economic, and social forces in society pressure organizations


to make fundamental changes in order to be ahead in social and economic development. Change may also be necessary because of internal conditions, for example when organizations become reified bureaucracies. In contemporary Denmark, for example, but also in other European countries and probably in the whole economic system of the West, the discourse of change is dominating.1 In the process of change European society has to become flexible and ready for change in order to achieve its goal of becoming the most innovative and competitive economy in the world (Campbell and Pedersen 2001). There are strong forces that put pressure on organizations, firms, and large companies in order to create change and impact social development. The discourse of the necessity of change has great impact on the concepts of market, state, and civil society. We are all human beings who are forced to be flexible, and we are all submitted to the necessity of change. It is required that we should not be resistant but feel positively towards innovation. Though we are submitted to these demands for change, we also experience them as dangerous and destructive processes. In many companies change and innovation are experienced as top-down processes – managing by fear – resulting in stress, breakdown, and despair among employees. The general response among management theorists and consultants to these situations of radical change is to focus on the human factor and its importance for uniting the economic necessity and value-chain creation approaches with the human relations and employee-based conceptions of change. They suggest that having a vision of leadership and change is paramount, and that employees should be integrated in these processes. This is really values-based management, where the ethical values are well-argued and show respect for universal norms. But in order for values-driven management to have real impact on the organization it must be based on a vision of values that are acceptable for all. Change management is about managing both values and stakeholders in the sense that positive feedback from employees and their motivation are both essential in order to make the change process organizationally and economically efficient. Change management is supposed to recognize that people in change processes cannot be reduced to mere economic production variables but should

1

T he Liberal Conservative government became marked by the discourse of change when it announced its intention to make Denmark a leading brand in the globalization of the entrepreneurial knowledge economy.

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Organizational Change and Values-Driven Management

be granted their dignity and humanity. Ethical values, morality, and visions of the good life cannot be ignored in processes of change in organizations. Accordingly, the way change management is performed is essential to achieve the economic and administrative goals of change processes. Processes of change in organizations have to acquire general legitimacy among major stakeholders in order to succeed. Keeping this in mind, the following discussion begins with an assessment of the discourse of change – illustrated by values-driven management – then moves on to examine different conceptions of management of change, and finally presents a possible interpretation of these processes within the perspective of institutional legitimacy and organizational ethics.

Discourse of Change as Values-Driven Management The discourse of change has been present in modern management discourse for nearly a decade. It began with the modernization of industrial capitalism during the 1960s. In the famous book, Future Shock, a popular futurologist, Alvin Toffler, predicted the end of bureaucracy and the rise of ad-hocracy (1970, 125). With the increasing change processes and competition stemming from the rise of capitalism, he predicted that – rather than becoming a prison of bureaucratic organization – the postindustrial capitalist organization would experience continual revolutionary changes through which it would be totally transformed from one day to day. Toffler described the new ad-hocracy as the advent of project organization in capitalist firms (1970, 132). It would not be stable bureaucracy, but project organization and ever-changing ad-hoc organization that would dominate the future. Since Toffler, management theory and management discourse have produced different new forms of management in order to deal and cope with change in society. John P. Kotter, a management professor from Harvard Business School, has become a well-known expert in the management of change. In one of his famous books, Leading Change, he emphasized the close relation between values-driven management and the management of change processes. Kotter opposes bureaucratic management to leadership, and argues that change processes are only likely to succeed when they are led by people with leadership capacity. In contrast to bureaucratic management, which focuses on planning, budgeting, organizing and staffing, controlling, and problem solving, leadership is based on the creating a vision that motivates and inspires people to be captured by the process of change (Kotter 1996, 21). Leadership of change 59


processes should, according to Kotter, be everything other than bureaucratic. Kotter proposes an eight-step change management process including:

1. Establishing a sense of urgency 2. Create a guiding coalition 3. Developing a vision and strategy 4. Communicating the change vision 5. Empowering broad-based action 6. Opening short-term wins 7. Consolidating gains and producing more change 8. Anchoring new approaches in the culture (1996, 21)

This concept of change management, as driven by vision-led and value-based leadership, can be said to be illustrative of the discourse of change in project society. It argues that change is necessary because of technological development and the internationalization of capitalist society in the era of globalization. Increased competition, with greater pressure on performance, and more danger and insecurity of a company being unable to survive, are conditions of the emergence of such and economy of change. Kotter’s contribution can be understood as a powerful example of change management that, combined with of the proposed values-driven management, can function as a way to deal with the possible stumbling blocks of change processes: (a) lack of a powerful vision, (b) lack of organizational development, (c) insufficient communication or (d) insufficient power to go through with change processes. All of these obstacles can compel organizations to return to their traditional bureaucracies. Values and vision are, arguably, central aspects of Kotter’s concept of wise leadership of change processes; however, given his focus on efficiency, it is necessary to augment his discussion of change management with theories of values-driven management or business ethics that include an emphasis on the importance of organizational legitimacy (Badaracco 1991; Boatright 2003; Carroll and Buchholtz 2002; Driscoll and Hoffman 2000; Elkington 1997; Fairholm 1994; Freeman 1984; Hoffman et al. 2001; McIntosh et al. 1998; Paine 1994; Paine 2003; Philips 2003; Weiss 2003; Wheeler, Sillanpää 1997, and Zadek 2001). Values-driven management is particularly useful for reforming conservative and bureaucratic organizations. In postmodern society, values-driven management is a method to make organizations conform to the requirements of soci60


ety by combining the need for economic efficiency with the prioritization of personal and human values in the workplace. Values-driven management can be used as an instrument to motivate employee engagement in the firm, in a context where work can no longer be justified by reference to a religious calling and search for eternal salvation. Values-driven management is conceived as an instrument of change that is critical towards the bureaucratic idea of organization man, or animal laborans, who is captured in the bureaucratic imperative of organizations without any ability or capacity to act and think on his own (Scott and Hart 1979). Values-driven management requires the acceptance of a plurality of values, not limited solely to instrumental concerns, that play a role in organization and change. As with Kotter’s concept of leadership, values-driven management is often presented as a major form of change management that is focused on making the organization more flexible and fit. This perspective stems from a human relations approach to change management, which argues that in order to make organizational change work, it is necessary to create a strong vision of the firm that is founded on strong values. Moreover, in order to be successful in changing the organization, you need to create a “sense of urgency of change” (Kotter 1996, 4). Values-driven management challenges economic methods of management as the most honest approach to make employees understand the scope and necessity of organizational change, and how change expresses an opportunity to make a better organization outside of concerns for economic efficiency. A change process is supposed to combine economic and value changes, so that the firm creates a new self-conscious collective identity that contributes to awareness of important values at all levels of the organization. This is confirmed by the close relation between values-driven management and other management concepts (e.g., organizational learning, culture theory, theories of quality development, etc.), which posit that organizational change must be justified by sincere appeals to a powerful vision that includes honest communication with employees (Hildebrandt and Brandi 2005). Many authors argue that using values-driven management in change processes has the potential to succeed because it combines economic concerns with concerns for human values and for need of collaboration and integration (Beyer 2006, 11). By focusing on ethics and values, it contributes to the reinforcement of employee self-organization, motivation, and ownership, and supplements instrumental rationality as the sole concern of the firm. This concept of values-driven management emphasizes that values do not fit into a stable 61


framework for the world (Paine 1994; Paine 2003; Beyer 2006) and avoids bureaucratic management by rules. Management by values emphasizes that the world is open and unpredictable, in contrast to bureaucratic conceptions of organization that want to keep a particular standard picture of reality. Values-driven management is capable of relating critically to strict structures and conditions of economic action. Values-driven management is a theory of culture and organizational learning, as well as quality and knowledge management. It is founded on a conception of the flexible conditions of postmodern society where changing work conditions and permanent restructuring of organizations are the norm. Valuesdriven management can, therefore, be conceived as an instrument to handle conditions of corporate ecologization with the surroundings. The discourse of change management in values-driven management emphasizes the importance of being aware of new forms of reflection, and how these forms can make employees much more flexible. Values-driven management is an instrument to transcend lack of motivation, a low sense of responsibility, and a low level of collaboration in companies. Values-driven management aims towards integration, collaboration, and the development of new forms of thought in open connection with surroundings, and the recognition that these actions occur in a space of complexity with many possible kinds of solutions that challenge traditional economic models. Many proponents of values-driven management emphasize the capacity to navigate chaos. All routines and rules should be temporarily suspended in order to facilitate a dialogue and process of change, which in turn makes it possible to reach new structures in the company. This process creates more learning, as type of “organization in chaos” (Kotter 1996; Beyer 2006, 55). Lars Kolind is a manager who illustrates this kind of values-driven management for organizations. In the 1980s, he worked for the firm Oticon, where he combined the necessarily hard process of economic change – due to the need for efficiency – with the realization of new values by reforming the whole structure of the organization from bureaucratic and hierarchical to project-oriented, serviceminded, and nonhierarchical. In values-driven management, it is not only the role of the manager to be a strong authority, but rather a kind of pilot of chaos, a visionary person who creates a vision and communicates. This manager helps employees find meaning in their jobs, so that change in the organization will be a process of development that contributes to the creation of a new identity and the unification 62


of values. The organization will become increasingly capable of innovating and developing its values through more dialogue and creativity in relation to the stakeholders of the firm, such as the customers, suppliers, employees, etc. An element of change is the development from bureaucratic organizational concepts to flexible and flat structures. A focus on values-driven management highlights how changing from hierarchy, rules, and stables structures to dialogue, values, and flexibility is central in order to understand the new demands of firms in public and private organizations. We perceive a personalization of the use of vocabulary moving from bureaucratic concepts, such as duty, to concepts like intuition, love, and emotion (Born and Åkerstrøm 2001). If we analyze contemporary discourse about change in public and private organizations, we can perceive that values-driven management often is proposed as a supplement to the economic concept of necessary value-creation. Concepts such as market competition, instrumental rationality, and strategy are suggested for implementation by the use of values-driven management, even though the focus is on values, dialogue and personal management. In this sense, focus on efficiency and economic bottom line can readily be combined with the strategic management of values and ethics in the organization, with particular emphasis on driving change through collaboration and personnel development (Beyer 2006). Theories of values-driven management are, therefore, helpful for overcoming tensions between different conceptions of change management. In Breaking the Code of Change, a collection of articles from a Harvard Business School Colloquium on Change Management, Michael Beer and Nitin Nohria address the problem of change by distinguishing between economic theories of change (E-theories) and theories of organizational capabilities (O-theories). E-theories focus on economic value, top-down leadership, and rational planning (Beer and Nohria 2000, 12). O-theories focus on organizational capabilities, leadership, and culture. Although values-driven management is a response to economic requirements, it can be situated within the framework of O-theories, hence there is a fundamental tension between the two categories (Beer and Nohria 2000, 4). Economic theories focus on shareholder value, economic incentives, formal structure and systems, and top-down and knowledge-driven change. Organizational capabilities theories concentrate on high commitment culture, human capability, high involvement, strong values, bottom-up, participative and values-driven concepts of change management.

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The challenge of how to combine economic change with conceptions of values-driven management is important. In fact, proponents of economic change are usually rather critical of the exclusive focus on organizational development in change theory. The major criticism of values-driven management as a theory and practice of change is presented by theorists who take an economic approach to institutional theory, such as Michael C. Jensen (who was inspired by Hayek and Friedman). Jensen argues that the focus on change is destroyed by theories of values-driven management, because they ignore the one true objective of the firm, value and profit maximization (Beer and Nohria 2000, 38; Jensen 1976). These theorists take the position that change cannot have many functions and values, but should be oriented towards this singular objective value. Jensen argues that values-driven management as stakeholder management in many cases does not really live up to this objective requirement.2 In order to accommodate economic approaches to organizational change, values-driven management should also focus on the objective of profit maximization. In fact, as demonstrated, this is exactly its function even though it focuses on human capabilities and other objectives in order to gain long-term economic value. As Peter Senge remarks, it is only possible to achieve the economic goals of the firm by having an approach to management that is open to a pluralist perspective with regard to important norms and values. From this vantage, values-driven management can be seen as based on the dynamics of organizational learning, or the “dynamics of nonlinear multiple feedback loop systems” (Beer and Nohria 2000, 65). Some see the combination of concerns for economic bottom-line with the ethical search for values as baldly manipulative, talking about values while giving employees even more stressful work conditions. The ethical potential of values-driven management should, however, not be forgotten. It can create increased motivation and creativity among employees, which contributes to combating a reduction of values-driven management to instrumental publicity for certain change processes in given companies. Values-driven management can, in this sense, be considered an instrument of management that is capable of mediating between economic and organizational theories of change, because values-driven management combines need for economic efficiency with concerns for organizational norms and values. 2

J ensen proposes an enlightened stakeholder theory that equates the goal of stakeholder management as supporting this central objective (Beer and Nohria 2000, 38; Jensen 1976).

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Institutional Theory and Values-Driven Management of Change How is values-driven management of change conceived from the point of view of institutional theory? As proposed, institutional theory represents an organizational ecology that can help to align the anatomy of change with value-driven management. Institutions are defined as patterns of interaction in organizations between formal structure and purely conventional behaviour (Meyer and Rowan 1977). The term institution is, therefore, very close to the concept of action that is presupposed in the theory and practice of values-driven management. Institutions are social practices between pure formal structure and loose organizational culture (Nielsen 2005, 46). Institutional theory has many important concepts that can help to understand why values-driven management is so present in change processes of public and private organizations. Values-driven management is also an illustration of the possible applications of institutional theories in management science. Institutional theory is an umbrella term for many different approaches – economic, political, and sociological – to organizations (Nielsen 2005). These different theoretical perspectives propose important differences and tensions for conceiving the role of values in organizational change processes. There is also a functional distinction between old and new institutional economics (Rutherford 1994), which can be used to clarify the E-perspective of valuesdriven management on organizational change. Old, or original, historical institutional economics dates to nineteenth-century Germany. It was inspired by the German historical school in philosophy and human sciences, which conceived of culture and history as important elements in economic development (Hodgson 1994). This conception of economics was later defended by Thorsten Veblen who argued that economic institutions are cultural and social creations and, thus, ethics and values are important for social change (Nielsen 2005). New institutional economics recognizes the importance of institutions for economic change. This approach is represented by economists like Oliver Williamson and Douglass North (Williamson 1989; North 1992). It takes the position that individuals seek economic efficiency and profit maximization following the economic concept of utility maximization. Institutional economics agree that institutions are important for understanding economic action, but these institutions are also considered as transaction costs and limits on efficient economic action (Coase 1937; Williamson 1984, 1985, 1989). Values and 65


ethics represent elements of transaction costs that may be a hindrance for efficient economic action and are, therefore, necessary to include in reflections about economics and management. Institutionalism in political science agrees with economic institutionalism that institutions are important for understanding human action. Political science institutionalism argues that we have to analyze organizations as institutions in order to understand organizational change and development (March and Olson 1989). Political science institutionalism is, however, characterized by social constructivism, and a hermeneutic and value-oriented perspective on social action. Rational choice and individual utility-maximization are not mutually exclusive, but social action is conditioned by broader factors based on values and interpretations of meaning. Political science institutionalism has a broader perspective on social action, as does neo-institutional economics, because action is determined by broader institutional rules, values, and cognitive horizons of meaning (Scott 1995). Like institutionalism in political science, institutional sociology emphasizes the importance of the role of rules, norms, and cognitive schemes of institutions for understanding organizational action (Powell and DiMaggio 1991). Institutional sociology represents a broader social constructivism and hermeneutics of social action than new institutional economics and some rational choice theories of political science. Institutionalism in sociology recognizes the importance of institutions for shaping values and interpretation of organizational meanings and structures. Instead of being determined by economic concepts of rational action and utility maximization, social reality in organizations is constructed out of the implicit demands and expectations of collective conceptions of meaning. In this approach, it is well-recognized that values and cultures are important for developing organizational legitimacy and adjusting to the world external to the organization. In these different institutional theories the term institution refers to aspects of behavior, norms, rules, values, and cognitive schemes that lie between formal organization and implicit organizational culture (Nielsen 2005). The concept of institution is broader than the concept of organization and narrower than the concept of culture. Institution refers to values, norms, and cognitions that combine factors of organizational development that are exposed in both E- and O-theories of organizational change. The change in terminology may, however, be somewhat foreign to institutional theory because institution refers to deep aspects of meaning and value that lie beneath surface appearance of 66


organizations and institutions. Institutional theory can, therefore, help us to understand the resistance to change that is implicit in many organizational processes; change processes challenge deep normative, rule-governed, and cognitive structures of organizations. Christine Oliver has provided possible answers to how organizational change implies a change in the values of organizations. She argues that norms and values are very present in institutional responses to possible organizational change. Among important strategies for avoiding change, she mentions: acquiescence, compromise, avoidance, defiance, and manipulation (Oliver 1991). By acquiescing, an organization uses habit, mimicry, and compliance with already existing rules and practices to avoid institutional change. Compromise is an effort to balance multiple expectations, and the accommodation and negotiation that are present. Avoidance strategies conceal nonconformity, or alter the goals in the direction of already established procedures. A strategy of defiance dismisses, challenges, or attacks new procedures, while a manipulate strategy seeks to shape values and criteria in order to control processes of change (1991). Confronted with these typical reactions to institutional change, we can perceive why values-driven management may be suitable for managing change in organizations. Values-driven management is characterized by a proactive and critical relation to already established path-dependency in institutions. As proposed by Kotter or Senge, it is a point of departure for values-driven management that organizations are characterized by values and norms that are likely to continue to play a role in change processes. Values-driven management accepts the importance of path-dependency while accepting the need for proactive evaluation of organizational processes. Institutional theory delivers an argument for understanding why values-driven management can combine the requirements of O-theories and E-theories of organizational change: Values-driven management is aware of the influence of the path-dependency of values on economic structures of organizations. There are epistemological and ontological arguments for undertaking change processes through values-driven management that fit well within institutional theory. The interplay between values-driven management as a strategic and normative instrument of organizational change, and institutional theory as a descriptive organizational metatheory with processes of organizational ecology and the anatomy of organizations embedded in social and cultural contexts is fruitful. Institutional theory explains the uses of values-driven management in 67


concrete situations and practice based management, thereby accommodating both O-theory and E-theory elements. At the same time, institutional analysis explains the limits, possibilities for, resistance to, and possible developments of organizational processes of change through values-driven management. It may seem that it is paradoxical to explain organizational change in terms of institutional theory. Because institutional theory focuses on institutional stability, path-dependency, and similar issues of organizational development, it seems to emphasize continuity and stability rather then difference and change. With regard to organizational change processes, this paradox may, however, represent a challenge because it makes it possible to conceive of change at a deeper level in the organization. From this point of view, what is regarded as radical change, may, at a deeper level of the organization, be understood as continuity and institutional stability. Moreover, what one singular organization conceives of as revolutionary may, from the point of view of general organizational development, be seen as an element in a general isomorphic transformation of institutional frameworks of organizations. Indeed, leading change processes by applying values-driven management, this feature of institutional isomorphism becomes visible (DiMaggio and Powell 1983). Different forms of managing institutional change processes are, seemingly, characterized and conditioned by the same structures and discourses of change. Many organizations feel the same pressures and they choose similar strategies of survival, with values-driven management as a popular method of changing values and norms. Institutional theory conceptualizes organizations as values, norms, and cognitive schemes, which helps explain how values-driven management functions as management of change. The fact that values-driven management is positioned between E- and O-theories, and that it combines the economic approach with the conceptualization of the need for change in organizations, also helps to explain its popularity. It can also be argued that values-driven management in organizations combines different ontological and epistemological concepts within institutional theory, including rational choice institutionalism, social constructivism, and mediated choice institutionalism (Nielsen 2005, 20). Values-driven management mediates between rational choice conceptions of institutions on the one hand, and social constructivist conceptions on the other. The ontological and epistemological presuppositions of values-driven management can be defined in terms of mediated choice institutionalism, where the tensions between calculation and culture, which are implicit in the tension between social con68


structivist interpretations and rational choice interpretations, are reconciled by the capacity to mediate between O- and E-theories of organizational change that characterizes values-drive management. Values-driven management may also be situated within sociological and political science institutional theory because it deals with organizations from the point of view of external and internal institutional legitimacy. Because valuesdriven management may be conceived as an instrument to create legitimacy in organizations, the normative political science institutionalism of March and Olson (Nielsen 2005, 25) helps to explain its function. Legitimacy concerns the capacity of the organization to create acceptance and fulfill expectations within its own environment, in the sense that it adapts to the expectations of the social environment. This emphasis on legitimacy indicates that the conceptions of human beings within political science institutional theory are not primarily instrumental. Actors are motivated by social as well as economic motives. Furthermore, human actions cannot be reduced to economic preferences, because actors are also conditioned by ethical values. From this perspective, values-driven management may be defined as an instrument of management that can conscientiously deal with path-dependency in institutional development. Path-dependency means that it is possible to identify earlier institutional forms that are likely to function as “paths” and, as such, continue and have great influence on future institutional development. Values-driven management questions deep values and structures of the organization and creates room for a critical evaluation of earlier institutional forms. In summary, new institutional sociology and new institutionalism in political science are very apt to constitute formulations of the epistemological and ontological foundations of the concept of organization that lies behind values-driven management. These theories have a shared focus on institutions as intentional horizons of meaning, and how values build on the cognitive, normative, and evaluative frames presupposed by values-driven management of change. Indeed, theories of values-driven management can also learn from E-theories of change, as proposed by new institutional economics, though there may be some tension between the narrow concept of economic actors in new institutional economics and the broader concept of socially motivated actors within the theories and practice of values-driven management. In some ways, this discussion comes full circle back to original institutional economics, which considered organizational and economic action as a part of a larger framework of social and cultural institutions of society. 69


Institutionalization of Values and Organizational Legitimacy Resolving the problem of corporate legitimacy is important for success with processes of change and acquiring long-term sustainability. The requirement of legitimacy is grounded in the fact that companies are not only technological tools of production, but open systems that enter into dynamic interactions with their internal and external environments. The concept of legitimacy originates with Max Weber’s description of different forms of legitimate authority: charismatic, traditional, value-rational, and instrumental goal rationality. These categories were used by Jürgen Habermas in his development of the concepts of instrumental goal rationality and communicative rationality, and later criticized by Niklas Luhmann, who described legitimacy as being an indication of the effort of organizational systems to survive and develop in interaction with their surroundings. Mark C. Suchman has continued this discussion. He defines legitimacy as an effort to adapt to the internal and external environment of the organization. The discussion of legitimacy has been marked by a tension between strategic and institutional definitions, with very little dialogue between the two theoretical traditions. Legitimacy can be conceived as a “process where the organization justifies to a peer or subordinate system its right to exist” or as a “congruence between the social values associated with or implied by (organizational) activities and the norms of acceptable behavior in the larger social system” (Suchman 1995: 573). It may also be a “generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions (574)”. For clarity, Suchman distinguishes between (a) a pragmatic strategy of legitimacy, founded on self-interests and of the idea that one can manage external and internal surroundings, and (b) a moral concept of legitimization, which is founded on the interest in the collective good and a cognitive concept of legitimization that presupposes the comprehensibility of environments and “taken-for-grantedness” of the activities of the organization. Moral and cognitive concepts of legitimacy partly limit the idea that it is possible to manage the formation of legitimacy, and they emphasize that organizations are formed and developed from the interactions between cultural norms, perceptions, and rituals in the environment. The strategic approach to legitimacy conceives of legitimization as something that can operate as a part of the strategy of the organization, while insti70


tutional concepts conceive of legitimacy as something that is also influenced by external relations. Pragmatic legitimation is based on strategic management, while moral and cognitive legitimation is, to a larger extent, based on communicative interactions with environments. With regard to values-driven management, the process of change in values-driven management arguably represents a combination of these three forms of legitimacy. This position may be defined as a normative, ethical institutionalism combining elements of sociological, political science, and original historical institutional theory. Such a normative, ethical institutionalism strives to provide an analysis of what the French philosopher Paul Ricoeur called the “the good life with and for the other in just institutions” as it is proposed by social philosophy and normative legal institutionalism in philosophy of law (Ricoeur 1990). Change theories, as proposed by Kotter and different theoreticians of values-driven management, are often practical and normative theories with a common goal of making organizations better and more sustainable for society. Values-driven management also operates with ethical concepts of justice and fairness towards employees and other stakeholders of the organization. The conceptual tools of values-driven management (e.g., creating a vision, mission, and value proposal of organizations) contain ethical and normative concepts of legitimacy that challenge the descriptive hermeneutics of mainstream institutional theory. Dealing with such normative issues of organizational justice and fairness, new economic institutionalism considers these issues in the framework of organizational efficiency and rational choice. Organizational values and concepts of justice should be related to institutional concepts of property rights and the possibility of a liberated actor in economic markets. We may say that this freedom of the actor is connected to their role as someone who exercises rational choice (i.e., homo economicus) and who has a free independent point of view from outside of the organization.3 For Richard Posner, the grand theorist of law and economics, legal institutions should be considered as instruments to promote rational choice and economic efficiency. Theorists of law and economics are, therefore, skeptical of traditional legal institutionalism, which conceives of law as based on a vision of justice and the social legitimacy of legal institutions.

3

n example may be the theory of law and economics that considers law as a function of economic A action as an institutional process (Nielsen 2005, 33).

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Original institutional economics, new institutionalism in political science, as well as the approach of new institutional sociology, share a possible theoretical foundation for the analysis of normative ethical issues, which stands in contrast to rational choice conceptions within new institutional economics, theories of law and economics, as well as some concepts of rational choice sociology and political science. This potential foundation is based on a shared hermeneutic perspective on institutions and agreement that the analysis of the normative interpretations of actors is important for understanding institutional development. Institutions shape cognitive and normative structures, collective action, identities, normative expectations, and the values of actors (Nielsen 2005, 59). Along with a criticism of rational choice approaches to institutional theory, these theories share with social philosophy the concern for the theoretical foundations of the legitimacy of social institutions. Using concepts from institutional sociology, it could be argued that the focus on legitimacy is not only on normative concepts but also on the link between values and cognitive structures. Through this link, legitimacy becomes what Berger and Luckmann call the “social construction of reality” and what Richard Weick calls “sense-making” in organizations (Nielsen 2005). As Richard W. Scott emphasizes, “institutional behavior is morally grounded behavior” (Scott 1995, 74; Nielsen 2005, 74). With this phenomenological and hermeneutic concept of institutions, sociological and political science institutionalism provide the foundation for approaching the issue of legitimacy of organizations. This poses the question of how to conceive of institutionalization as a problem of creating institutions and organizations that help to shape freedom and the good life of organizational agents, which may be considered an essential issue in valuesdriven management (conceived as a part of organizational ethics). In order to achieve this analytical goal, it is important to consider elements of what may be called legal historical institutionalism, as opposed to the tradition of law and economics. Historical legal institutionalism may be conceived as the mainstream tradition of natural law from Thomas Aquinas to Hegel that posited the issues of the good life and justice in institutions as essential issues of analysis. This point of view has been repeated by many theorists of law and justice in modern legal philosophy, in opposition to legal positivism. Ronald Dworkin’s position, for example, is an institutional view of law by a jurist and legal philosopher. He considers institutions as legal constructs based on the “law as integrity,” that create new institutions based on external and internal requirements of legitimacy. What is important in this concept is the idea of a legal system as a system 72


of coherence in interpretation that is based on the search for “equal concern and respect” and the respect of justice as fairness (Dworkin 1986). In addition to institutionalism in legal philosophy, we can draw on institutionalism from the social philosophy of Cornelius Castoriadis to explain the legitimacy of values-driven management for organizational change. Castoriadis argues that humanity searches to come to autonomic self-expression through imagination as a primary force of history. The social imaginary is a dream of human autonomic emancipation and self-expression. Social institutionalization is a product of this social imaginary. For Castoriadis, this theory of imaginary institutionalization relies on a theory of democracy, because democratic policy is based on an ongoing search for autonomy and critical questioning of existing social institutions. Direct democracy is created in an open process of creation, but also in the capacity of self-limitation, and wise and prudent decision making. The ethos of democracy is an understanding of the limits of human existence and action. It only by understanding self-limitation that we can understand the conditions of human autonomy and democracy. With this in mind, Castoriadis’s concept of institutionalization can be applied to the process of change through values-driven management, and assist in the experience of a searching for autonomy and self-limitation, thereby helping to explain why ethics and values are so important for creating a new understanding of the meaning of business organizations in society. Valuesdriven management, as a basis for social legitimacy, can, therefore, be seen as an aspect of the institutionalization of democracy in modern society. In contrast to the bureaucratic organization of reified institutions, with its strict separation of groups and classes and with strong hierarchical structures based on instrumental and utility oriented rationality, the imaginary search for autonomy is characterized by striving for autonomy and emancipation (represented, for example, by new social groups and their reaction against established social structures). According to Castoriadis, the human revolutionary project must be conceived as an effort to become emancipated from bureaucratic structures in an imaginary creation of autonomous democratic institutions. The social imaginary is not a picture of anything. It is not predetermined, but it expresses a capacity to create in the perspective of hope and desire of a better social reality and new social institutions. In L’institution Imaginaire de la Société, Castoriadis defines this concept of institutionalization as the foundation of a theory of democracy (1975): His73


tory is understood as creation (poiesis), determined by the human imaginary capacity for creation. Society is created through an imaginary symbolism based on conceptions of meaning and values that are the basis for social existence. We can talk about a social capacity of imagination that represents a capacity to imagine and, thereby, contribute to the creation of new social structures and contexts. Human imaginary capacity can be characterized as a primordial way of being that contributes to the creation of common imaginary contexts of significance as the basis for community and collective meaning. This horizon of meaning can – depending on whether one is discussing democratic or totalitarian forms of organization – be based on a more or less open or closed autonomy. Dworkin and Castoriadis’s concept of normative institutionalization aides in understanding the function of values-driven management for creating new horizons of social legitimacy. The increased focus on social responsibility, ethics, and stakeholder management within values-driven management can be considered as an effort to create stronger organizational integrity, as well as organizational change, in the direction of human freedom and the imaginary creation of collective meaning. Values-driven management can be viewed as an element of the poetic auto-institutionalization of democratic societies in order to create organizational legitimacy. The auto-institutionalization process, when undertaken by stakeholders, creates new values for corporations, which correspond to the expectations of society.

Conclusion In conclusion, this chapter has elaborated the concepts of organizational change and values-driven management from the perspective of institutional theory. It started with the discussion of values-driven management as a response to the demands of change in modern corporations. Values-driven management is able to deal with many issues that cannot be captured by economic concepts of change management. Analyzing values-driven management from the perspective of institutional theory, it is possible to understand why this kind of management is so important in order to cope with the question of legitimacy and change in modern organizations. We can argue that explicit values are formulated as a response to new conditions of action in complex modern societies. New values of corporate social responsibility and the triple bottom line, which combines the economic with the social and environmental bottom-line, are paradigmatic examples of this development. From the per74


spective of the auto-institutionalization of freedom in democratic societies, principles of values-driven management may be considered as resultant of cognitive developments of the understandings of social relations. In order to create social acceptance of their actions, companies conform to democratic principles of freedom and justice so that they become more embedded in the cultural understanding of society. Social legitimacy is institutionalized by the fact that companies respond to the expectations of complex democratic societies.

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Meyer, J.W., and B. Rowan. 1977. Institutionalized organizations: Formal structure as myth and ceremony. American Journal of Sociology 83(2):340-363. Oliver, C. 1991. Strategic response to institutional processes. Academy of Management Review 16(1). North, D.C. 1990. Institutions: Institutional change and economic performance. Cambridge: Cambridge University Press. Paine, L.S. 1994. Managing for organizational integrity. Harvard Business Review. (March/April):106–17 –––. 2003. Valueshift: Why companies must merge social and financial imperatives to achieve superior performance. New York: McGraw-Hill. Philips, R. 2003. Stakeholder theory and organizational ethics. San Francisco: Berrett-Koehler, Inc. Powell, W.W., and P.J. DiMaggio. 1991. The new institutionalism in organizational analysis. Chicago and London: University of Chicago Press. Ricoeur, P. 1990. Soi-même comme un Autre. Paris: le Seuil. Rutherford, M. 1994. Institutions in economics: The old and new institutionalism. Cambridge: Cambridge University Press. Scott, W.G., and D.K. Hart. 1979. Organizational America. Boston, Mass.: Houghton, Mifflin. Scott, W.R. 1995. Institutions and organizations. London: SAGE Publications. Suchman, M.C. 1995. Managing legitimacy: Strategic and institutional approaches. Academy of Management Review 20(3). Toffler, A. 1970. Future Shock. New York: Random House.

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Weiss, J.W. 2003. Business ethics: A stakeholder and issues management approach. 3d ed. Mason, Ohio: Thomson South-Western. Wheeler, D., and M. Sillanpää. 1997. The stakeholder corporation: The Body Shop blue print for maximizing stakeholder value. London: Pitman Publishing. Williamson, O.E. 1989. The economic institutions of capitalism. New York: Free Press. –––. 1985. Market and hierarchies: Analysis and anti-trust implications. New York: Free Press. –––. 1984. The economics of governance: Framework and implications. Journal of Institutional and Theoretical Economics 140. Zadek, S. 2001. The civil corporation: The new economy of corporate citizenship. London: Earthscan.

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Chapter 4

Changing Success Criteria for Public Sector Institutions Squaring the Circle? By John Storm Pedersen

Section One: Introduction More than 11,000 public institutions produce and deliver at least ninety percent of Denmark’s core public welfare services. In order to be considered successful, the production, delivery, and consumption of these services must fulfill four types of success criteria:

1. Direct external cross-sector success criteria; 2. Sector-specific success criteria; 3. The two core success criteria of the Danish welfare state; 4. Systemic success criteria.1

This chapter focuses on the first type succes criteria.

1

F or a comprehensive discussion and analysis of different types of success criteria for the production, consumption, and delivery of public core services by public institutions see Pedersen 2004, 2003, 2006.


These criteria are referred to as “direct external” because they are defined by the national, regional and local political systems and its political-administrative organizations, which, furthermore, are assumed – more or less correctly – to have granted control over the fulfillment of these criteria to the public institutions. They are called “cross-sector,” because they are common to public institutions across all sectors in a welfare state. The position of the present Danish government, at of time of writing in 2007, is that its public institutions are in a position to fulfill direct external cross-sector success criteria at a (much) higher level because they have already received sufficient resources. The government’s main strategy to force/help public institutions in fulfilling the criteria at a higher level, without allocating new resources, is to implement top-down reforms in the welfare state. The direct external cross-sector success criteria are very similar to some of the success criteria discussed within the framework of New Public Management (NPM), which seeks to ensure that taxpayers get the most value for their money by putting public institutions under pressure regarding the production and delivery of public services (Hood 1995).2 This chapter can, therefore, be seen as a contribution to the debate on NPM regarding success criteria for the production, delivery, and consumption of welfare services produced and delivered by public institutions. It also questions how well these criteria are currently being fulfilled, and whether they are realistic for public institutions. The following is a brief discussion of the other three types of success criteria: Sector-Specific Success Criteria Examples of this type are: demanding a specific success rate for the treatment of different types of cancer and strokes at an individual public hospital, or at all hospitals demanding a certain score on the PISA survey (an international measurement of schoolchildren’s technical skills) for an individual state school, or all Danish schools; and requiring a specific average number of hours spent in the classroom by teachers at every state school, or an individual school.3

PM consists of two interrelated lines of thinking. First, public institutions can benefit from copying N important elements of how private companies are managed. Second, public institutions should be exposed to market conditions, thereby making them more efficient, oriented towards the user’s needs, etc. The basic thrust of NPM is to make the public sector achieve the economic optimality that exists – theoretically – in a perfect market economy. 3 See Indenrigsministeriet 2004b for more examples of sector-specific success criteria. 2

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Changing Succes Criteria for Public Sector Institutions

The Two Fundamental Success Criteria of the Danish Welfare State The core goals of the Danish (and the Scandinavian) welfare state are (a) to create a very high degree of measurable equality among its citizens, and (b) to support (indirectly) private companies and the market economic system, in general. Furthermore, these goals must be realized simultaneously (Pedersen 2003, 2004). This has been achieved, traditionally, through the production and delivery of services by public institutions. One indicator of how successful these institutions have been in generating equality among the citizenry is the Gini-coefficient. According to United Nation Development Programme’s Human Development Indicators (2005), Denmark has a very low Gini-coefficient compared to the other countries it considered. Two indicators of how successful public institutions have been in supporting private companies and the market economy are 1) the long-term national strength of competition and 2) the flexibility in the economic system, especially in the labor market. Denmark does very well on both counts (OECD 2005; Jørgensen 2007). Systemic Success Criteria Success criteria at the level of the welfare state are generated by issues, such as: national budget policies, tax policies, EU standards implemented by the Danish parliament, and national standards set-up by political-administrative organizations (e.g., for the removal of children from their parents). Each single public institution is, however, also forced by political systems and their political-administrative organizations to contribute to the fulfillment of systemic success criteria. In other words, each institution has to fulfill its obligations by keeping the budget, sticking to the national rules and standards, etc. These criteria are constituted in a broad and nonhomogeneous manner.

Section Two: The Criteria and their Fulfillment Approximately twenty direct external cross-sector success criteria can be derived from a resent comprehensive report on the efficiency of the Danish welfare

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state in producing and delivering core welfare services (Indenrigsministeriet 2004b).4 These criteria can be grouped into five categories. There are success criteria concerning: 1) Economic efficiency in the daily operations in public institutions 2) The quality of the services produced and delivered by public institutions 3) Democratic control over, and stakeholder influence on, the production, delivery, and consumption of services by public institutions 4) The production, delivery, and consumption of services by public institutions that are tailored to the single user’s/citizen’s needs 5) The use of market mechanisms on the demand side to regulate the supply side of public services.5 The criteria are not derived using tools of social scientific analysis such as surveys, interviews with managers of public institutions, or reviews of the existing literature on the efficiency of public institutions. They merely reflect that success criteria are beliefs handed down from political systems to political-administrative organizations and, finally, to public institutions. These beliefs inform the report’s assessments of the extent to which the welfare state – the public institutions – fulfill the success criteria. To investigate whether or not these criteria are baseless and whether or not the five categories are appropriate, they were presented to and discussed by roughly 2000 managers of and employees in public institutions at seminars, conferences, and workshops in 2005 and 2006.

T he report was produced by the Strukturkommission, which was an official commission (2002–2004) that analyzed the need for a structural reform of the Danish welfare state. As a part of the analysis, both cross-sector and sector-specific success criteria were mapped and reported (Indenrigsministeriet 2004b). There is an agreement between the present Danish government and the Danish People’s Party (Dansk Folkeparti), which supports the present government in reforming the Danish welfare state (Indenrigsministeriet 2004a). This agreement also expresses many of the success criteria for public welfare services and public institutions. See Pedersen 2004 for a summary of the success criteria in Strukturkommissionens Betænkning. 5 In practice, this is to make sure that users can choose freely among public suppliers. If the users/ citizens can choose freely among public suppliers of welfare services, at the end of the day they will gain the most value for their tax revenues. This will promote “good” institutions and eliminate “poor” institutions in the very long run. 4

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An interesting result of the investigation was that the managers and employees felt the success criteria to be real. Furthermore, the five categories of success criteria were, in general, accepted by the managers and the employees as being appropriate. Some version of these five categories was already used in many of the institutions to structure the daily operations. To test the validity of the results, a more comprehensive survey was carried out nationally in 2006. It showed that not all the five categories were used by managers. The criteria in category one, concerning economic efficiency in the daily operation of public institutions, was not in use. As will be discussed later, this has important consequences for the fulfillment of the success criteria by public institutions. The population surveyed included managers of kindergartens, state schools (grundskoler), institutions for disabled persons, elder homes, and after-school institutions.6 There are approximately 11,000 of these types of institution in Denmark. 1502 managers were asked to fill in a web-based questionnaire in November/December 2006. It was completed by 759, or 51 percent, of the managers.7 In section three, the context of the production, consumption, and delivery of welfare services is presented and discussed. This context is important for understanding the direct external cross-sector success criteria as well as evaluating how the institutions performed. Section four presents the government’s top-down reforms in the public sector. These reforms aim to change the context of the production and delivery of services, and may force and/or help public institutions fulfill the criteria at a higher level. The discussion continues by considering the effect of these reforms. Section five considers the long-term development of the success criteria, which shows that they are not static (stable) but dynamic (changing). Over time they (a) increase in number, (b) change with increasing frequency, and (c) become

P ublic hospitals/managers of public hospitals were not included in this survey, primarily because the profile of these institutions regarding management, number of employees, annual budget, requirements in the daily operations, location in respect to users, etc. is markedly different. 7 Managers were asked about much more than the direct external cross-sector success criteria and their fulfillment. They were also asked about governance models for the production and delivery of public services, innovation, how they used their time during the day, etc. For more details see Appendix B: The Survey. The main results of the survey are published in Pedersen 2007. 6

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more conflicting. A simple straightforward consequence of this is that they become more and more difficult for institutions to fulfill at a high level. Finally, section six presents the results of the national survey regarding the success criteria and their fulfillment. The results are analyzed and discussed on the basis of the considerations presented in the preceding sections. This section concludes by discussing whether or not the ability of public institutions to fulfill the criteria is limited.

Section Three: The Context The production and delivery of public services takes place, first and foremost, within the context of the welfare state. The division of labor and financing for these services is a stratified political and political-administrative concern, or construction, with responsibility distributed along three levels: state, regional, and municipal. Second, authorities must make decisions within the context of a huge array of possible theoretical models for the production and delivery of public welfare services. In practice, however, not that many models are given legitimacy at any given time. In brief, there are currently seven widely known models for structuring these services: 1. The budget and monopoly model, whereby public institutions are given annual budgets and virtually granted monopolies by the political systems and political-administrative organizations to produce and deliver services in certain areas (a municipality or a region). State schools represent an example of this model. 2. The contract model, under which a region or municipality and its public institutions agree on contracts defining the services the public institutions shall produce and deliver, and the conditions for their production and delivery. An institution receives its annual budget to finance its activities on the basis of its contract. The contract model can be found in all fields of the production and delivery of public services. 3. The public procurement model, whereby both public institutions and private companies bid for the production and delivery of public welfare services. Elder care in some municipalities can be used as an example of

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this model. In spite of many political and political-administrative efforts to bring this model into practice for more than two decades, it is still almost nonexistent in Denmark.8 4. The public-private partnership model (PPP) is also used for production and delivery of services;9 however, the number of PPPs in Denmark is less than fifty per year (Pedersen 2004, 2006). 5. The pseudomarket model, under which the political systems and political-administrative organizations create, regulate, and control a form of market for the production, delivery, and consumption of services that renders public institutions as competing “companies.” The free choice of suppliers in Danish elder care can serve as an example of this model, though users of other public services in Denmark have not widely responded to this model. 6. The open competition model. This encourages open competition between public institutions and private companies for the production and delivery of services. Food preparation and delivery for the elderly have been handled this way in certain municipalities. 7. The citizen-as-customer model, whereby citizens are given money and/or vouchers to buy services from either public or private suppliers. Ideally, this should give the customers/citizens the most value for their tax expenditures, yet this model is almost never used in Denmark.10

In the national survey, managers were asked their opinion on models one, two, four, and five (see Appendix A). Approximately seventy percent of the managers said their institutions operate within the context of the budget and monopoly model. Approximately thirty percent said their institutions operate within the context of the contract model. The survey also shows that the PPP model and the pseudo-market model are almost nonexistent in Denmark.

See Pedersen 2006. Some of the activities of the Danish company, Zealand Care A/S, provide examples of PPP. Zealand Care A/S develops and distributes equipment for disabled people in some municipalities. For more details see www.kvalicare.dk. 10 The Dutch version of the model has been under consideration, but not implemented. For a more detailed definition of the models and a comprehensive analysis, see Pedersen 2004, 2003. 8 9

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The managers were asked to anticipate how the use of various models would change within the five-year period after the survey. They predicted that the PPP and pseudo-market model would continue to be nonexistent, that the use of the budget and monopoly model would decrease, and that the use of the contract model would increase. A little more than thirty percent of managers expected that their institutions will operate within the context of the budget and monopoly model. In contrast, almost sixty percent of the managers expected that their institutions will operate within the context of the contract model (see figure 4.1). Governance Models Present Model

Model in 5 Years

80 70 Percentage

60 50 40 30 20 10 0 Budget and Monoply

Contract

PseudoMarket

PPP

Figure 4.1. Governance Models

Reduced use of the budget and monopoly model and increased use of the contract model in the future will, of course, change the context of the production and delivery of services by public institutions. The consequences of this changing context on the direct external cross-sector success criteria and the probability that institutions will fulfill them is analyzed and discussed in section six.

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Section Four: Reforms, Fulfillment of Success Criteria at a Higher level, and More Control One of the beliefs of the present government in Denmark is that public institutions can fulfill the direct external cross-sector success criteria at a (much) higher level without receiving additional resources. To achieve this, the government has implemented a structural reform in 2006 and 2007.11 The government is, furthermore, designing both a quality reform, and an accounting and budget reform. All of these reform initiatives share the common aim to force and/or help public institutions to improve the level of fulfillment of the success criteria using their current resources. In principle, structural reform is very simple; however, in practice it is very complex. First, the number of municipalities in Denmark is reduced from 272 to 98, increasing the size of the average municipality.12 The number of counties (now called regions) is reduced from thirteen to five. Even though this effectively increases its size, an average Danish region will still be far smaller than the EU average. The Danish regions will have an approximate range of 700,000 to two million inhabitants. Second, the division of labor among the state, regions, and municipalities is changing. The municipalities will produce and deliver most of the core welfare services to the citizens. The regions will have a near monopoly on the production and delivery of health services. The state will, in principle, only take care of the coordination and control of the production and delivery of public services in the regions and the municipalities. The state will, however, make some of the principle decisions regarding the external environment, urban and industrial planning, and infrastructure maintenance and construction. Finally, the financial system – the flow of tax revenues – within the welfare state is also changing. The main reason for this is fourfold: 1. To match the new division of labor among the state, the regions, and the municipalities

11 12

See Pedersen 2006 for more details. The municipalities will have very different numbers of inhabitants. The smallest will have approximately 2,000 inhabitants while the largest will have approximately 450,000.

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2. To make the financial system more transparent for all actors involved in the production, consumption, and delivery of welfare services 3. To block the municipalities from externalizing some of the costs of services produced and delivered by municipal institutions to the counties or the state 4. To build in new incentives in the financial system to reward the municipalities and counties for fulfilling the success criteria. For example, a county could receive a bonus if one of its hospitals exceeded the anticipated production of health services. As mentioned, the goal of the structural reform is to force and/or to help public institutions to fulfill the direct external cross-sector success criteria at a higher level in the years to come. The structural reform will certainly force public institutions to attempt to fulfill the success criteria at a higher level. The survey shows that between seventy-one and eighty-three percent of the managers believe that the structural reform will lead to demand for improvements in the level of the fulfillment of the direct external cross-sector success criteria “to a great extent” and “to some extent.” In contrast, between seventeen and thirty percent believe it will lead to little or no demand for improvements in the level of the fulfillment of the direct external cross-sector success criteria (see table 4.1). More efficiently produced services

Higher quality

Improved legal rights

More tailored services

To a great extent

34

37

29

30

To a certain extent

49

41

42

41

To a low extent

11

14

21

20

Not at all

6

8

9

9

Total

100

100

101

100

N

693

702

654

679

Table 4.1. Structural Reform: Demands and Percentage 88


The structural reform will, when fully implemented, change the political and political-administrative external environment for public institutions. However, no major direct causal links exist between the three main elements of the Danish structural reform, the daily operations of public institutions, and the fulfillment of the direct external cross-sector success criteria (Pedersen 2006). Relatively few managers of public institutions think, therefore, that the structural reform will help improve the fulfillment of the direct external cross-sector success criteria. The survey shows that fifty-six percent of the managers think that the reform will be neutral regarding the level of the fulfillment of the criteria. Only fourteen percent think that the reform will lead to improvements in fulfillment. More importantly, thirty percent think that the reform in itself will lead to a decreased level of fulfillment (see table 4.2).  

Percentage

N

Much Better

1

6

Better

13

81

Neutral

56

336

Worse

27

161

Much Worse

3

21

100

605

Total

Table 4.2. Structural Reform: Better or Worse Services

Political systems and their organizations will, of course, try to ensure that structural reform is successful. To achieve this, the political systems and their organizations will portray decisions rooted in structural reform – decisions which force public institutions to merge horizontally or vertically – as having positive effects on the ability of public institutions to fulfill the direct external cross-sector success criteria. A key expectation of the merged and larger public institutions will be that they can become more economically efficient as they benefit from improved economies of scale, decreased learning curves, and shared knowledge management.13 The consequence of this expectation is analyzed and discussed in section six. 13

Hagedorn-Rasmussen, Højland, and Pedersen 2006; Pedersen 2007.

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As shown in table 4.3, fifty-five percent of the managers expect their institutions to (be forced to) merge horizontally or vertically with other public institutions in the five-year period following the survey. Percentage

N

Unchanged

36

253

Horizontal merger

33

232

Vertical merger

22

151

Fragmentation/closure

9

62

100

698

Total

Table 4.3. The most likely Scenario Within Five Years of Survey Completion

The Danish government has, in parallel with structural reform, established several new agencies to promote improved fulfillment of the direct external crosssector success criteria. For example, organizations have been established to analyze the efficiency of daily operations in public institutions and, on the basis of these analyses, recommend which instruments are best to put pressure on public institutions to fulfill the direct external cross-sector success criteria.14 In a similar effort, the National Agency for Health will be reorganized in 2007. It will be given more administrative power to directly order how hospitals organize their daily operations and to implement instruments to secure that these operations will be executed as efficiently as possible.15 New agencies created by the government and the state will, by definition and in practice, put pressure on public institutions to improve the fulfillment of the success criteria. Some of the consequences of this pressure will also be discussed in section six.

Instruments include Yard Stick Competition, DEA-analysis, and budgets on the basis of average cost per produced service. 15 Examples include the procedures for the treatment of cancer and strokes, and a budget released each month in accordance with actual efficiency in daily operations. 14

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Section Five: The Long-Term Development of Success Criteria Seen from a long-term perspective, neither the direct external cross-sector success criteria nor the other three types of success criteria mentioned in section one are static. In this section, a very preliminary study of teaching in state schools is used to illustrate the development of success criteria and their longterm fulfillment.16 The original success criterion for teaching in state schools was that the children should learn to calculate, write, and read better from school teaching than from their families. After a relatively short period it was also required that as many children as possible should be taught in state schools. This success criterion was fulfilled to a great extent by the development of inexpensive teaching methods (i.e., mass production) in the state schools. It was later required that teaching should be pedagogical: children were to increasingly learn more by using evermore effective learning methods. The teaching was also to contribute to the children’s healthy development, both physically and mentally. To achieve this, physical education and creative subjects such as music and art were put on the syllabus. Individual attention was later – towards the end of the twentieth century – added to the list of success criteria for teaching in state schools. In the first years of the twenty-first century, this has developed to include written plans for the individual child’s technical and personal development in the school. Very recently, this demand has been expanded to include children in kindergarten, whereby the child’s development should continue uninterrupted in the state schools. The direct influence of parents and children on teaching has been considerably strengthened in recent decades. Parents and children are becoming more and more involved in its preparation and evaluation. This occurs both on a day-to-day basis and through pupil councils, parent boards, etc. Individual state-sponsored Danish school are owned by the municipalities, which means that state schools do not have to make a profit. As citizens demand, however, that tax rates must not rise, more pressure is put on schools to keep within their budgets. This creates inevitable tensions as these same

16

T his provisional study of teaching in state schools is based on the following literature: Henriksen (1999), Kettel (2001) and Weinreich (2006a, 2006b).

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citizens demand that state schools carry out more and more tasks. An example – disseminated through the media or by members of interest groups – is the demand that state schools should not merely teach the children to read, write, and calculate; they should also give the children a general education. Accordingly, children should be taught and trained in democratic behavior, empathy, and to be socially competent. State schools should also make a considerable contribution to tackling the problem of the intergenerational transmission of poverty. As well, the schools should make a considerable contribution to the integration of children with different ethnic backgrounds.17 These soft-success criteria are supplemented by hard-success criteria, including, among other things, that children should attain measurable skill levels in reading, writing, and arithmetic.18 The state schools should also ensure that they have modern IT equipment and good facilities, so the children can have an education that equips them for the future. All this adds up to more and more success criteria fulfilled, at a higher and higher level, within the framework of budgetary constrains. Teaching in state schools can be regarded as a critical case, which – with some cautions – can be treated as representative of the production, delivery, and consumption of other core welfare services produced and delivered by public institutions.19 The development and fulfillment of the success criteria can be charted as follows: 1. Draw a timeline which, for example, starts in 1900 and ends in 2007 2. M ark on the timeline the emergence of the success criteria for the production, delivery, and consumption of the different core welfare services 3. Mark on the timeline the changes in the existing success criteria 4. Map conflicts regarding the fulfillment of the success criteria.

It has recently been stated that the increasing number of such secondary success criteria for the state schools now compromise the primary success criteria (e.g., teaching reading, writing, etc.) (Weinreich 2006a, 2006b). 18 An example of this is that the state schools should ensure that the children achieve a good, and in time better, placing in the PISA survey. 19 See Flyvbjerg (1991, 1:150; 2006, 229–30) regarding the possibility of generalizing on the basis of critical cases. 17

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The result will be that the number of success criteria, including the direct external cross-sector success criteria, increases over time. Furthermore, the success criteria are changed more frequently, become increasingly conflicting, and are fulfilled at a higher and higher level by the public institutions. Given this pattern, public institutions will perceive that the direct external cross-sector success criteria and the three other types of success criteria change over time. Furthermore, the production, delivery, and consumption of public services becomes more complex over time, which makes it still more difficult for public institutions to realize their ultimate goal: to fulfill the success criteria at the highest possible level, as demanded by the many stakeholders linked to these institutions. One could say that the long-term development of the success criteria has created an impossible mission for public institutions, and hence managers. There has been a tendency to confront public institutions with more and more conflicting success criteria, requiring them to handle stronger and stronger daily operational cross-pressures – to balance and calibrate still more conflicting success criteria. One could also say that the production and delivery of services, which fulfill the success criteria for public institutions and their managers, becomes a task and a job similar to squaring the circle. This will be discussed in more details in the next section.

Section Six: The Direct External Cross-Sector Success Criteria and their Fulfillment Of the five categories of direct external cross-sector success criteria listed in section two, the survey confirms the existence of categories two, three, four, and five. Between forty and sixty percent of the managers answered that the political systems and political-administrative organizations demand category two, three, four, and five “to a great extent” (see Figure 4.5).

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Succes Criteria Demand

Fulfillment

Importance

100 90 80 Percentage

70 60 50 40 30 20 10

ice ho eC Fre 5-

2-

Pr

of

es Cr sion ite al ria 3Le ga lR igh ts 3Tra ns pa re nc y 4Ta ilo re dS er vic e

ne ar Ne 2-

1-

Pr

ice

ss

0

Figure 4.5. Success Criteria

Furthermore, the survey shows that sixty percent of the managers answered that the political systems and the political-administrative organizations demand category one “to a low extent” or “not at all.” Looking at the fulfillment of the direct external cross-sector success criteria, the survey shows that between fifty and seventy percent of the managers say their institutions “to a great extent” fulfil categories two, three, four, and five. In other words, the institutions generally fulfil the success criteria at a fairly high level. Figure 4.5 also shows, however, that managers give “importance” a higher score than both “demand” and “fulfillment” for every criterion except “free choice.” This indicates that managers believe categories two, three, and four can and ought to be fulfilled at a higher level. In the context of the decades-long NPM debate, as well as the reform(s) in the public sector mentioned in section four, it is surprising that public institutions are not confronted with category one – success criteria concerning economic efficiency in daily operations.20 Furthermore, when public institutions are not 20

T he results are also surprising because, when asked before the national survey was carried out, the managers and the employees said that category one is used.

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confronted with category one they have no or only very soft incentives to improve their economic efficiency. This is reinforced by the fact that most public institutions operate within the framework of the budget and monopoly model as shown in section three. After having received their annually allocated resources, the main task for the institutions – and the managers – is simply to keep the budget. No major systemic incentives or strong management incentives are built in to help and/or to force the institutions to improve their economic efficiency. As shown in section three, use of the budget and monopoly model will, however, likely be reduced in the five years subsequent to the survey, while the use of the contract model will increase during the same period. This outcome would result in most public institutions operating within the framework of the contract model. If the contract model is designed and administered within the framework of the NPM debate (i.e., principal-agent theory, the theory of outcome management, etc.), it will mark a fundamental structural change in the context of the production and delivery of services, and hence in the definition and fulfillment of institutional success criteria. Public institutions will be confronted with category one and demands to fulfill the success criteria at a higher level. It is, however, not likely that the contract model will be designed and administered within the thinking of NPM in the short-term. More contracts are established around cooperation between a municipality, or a region, and its institutions than between a principal and agents, which means that they typically lack legal status. These informal contracts try to create a win-win situation for a municipality, or a region, and its institutions. For example, if institutions can reduce recruitment costs, costs related to absenteeism, or maintenance and equipment costs they save money for other purposes. In turn, the municipality, or the region, doesn’t have to pay for these purposes through future budget increases. From this perspective, it could be argued that the contract model is an informal formalization of the budget and monopoly model and is, therefore, very much out of line with the contracts described and analyzed within NPM. As mentioned previously, the goal of the structural reform is to help and compel public institutions to fulfil the direct external cross-sector success criteria at a higher level. Furthermore, it was shown that (a) a high percentage of managers believe that reform will lead to increased demand for fulfilling the success criteria at a higher level and (b) that few managers believe the reform will not help the institutions fulfill the success criteria at a higher level. If in the coming years managers of public institutions can show and document that structural reform did not help public institutions fulfill the success 95


criteria at a higher level, but only led to increased demand for fulfilling them at a higher level, then the reform might be considered as unsuccessful. To avoid this, the political systems and their administrative organizations will probably decide to merge public institutions. A key expectation is that these bigger public institutions can produce and deliver services much more economically efficiently. In other words, these mergers will confront public institutions with success criteria concerning economic efficiency in their daily operations (i.e., category one). The important question becomes: How shall the political-administrative organizations implement category one in practice? For the political-administrative organizations a very easy and direct way to implement these criteria would be to build success criteria into the contract model. If this occurred, the contract model would be in line with NPM thinking. Furthermore, if the general demand to fulfil the direct external crosssector success criteria at a higher level were to also be built into the contract model, it would be even more in line with NPM. The agencies created by the government/state, which will control the fulfillment of the success criteria, should, of course, be very supportive of tailoring the present contract model in line with NPM thinking. This process might, slowly and incrementally, change the context of the delivery of services and hence the definition and fulfillment of the success criteria. As discussed in section five, the long-term development of success criteria tends to create an increasingly difficult situation for public institutions and managers as they seek to fulfill the direct external cross-sector success criteria at a higher and higher level. This difficulty is exacerbated by structural reform, the possible alignment of the contract model with NPM thinking, more severe control of institutional fulfillment of the success criteria, etc. Until now, institutions and managers have, however, been able to fulfill given success criteria at a higher and higher level. One important reason why public institutions have been able to manage the situation is that success criteria concerning economic efficiency in their daily operations have not been implemented at the level of the single institution. This has made it possible to escape being forced to focus on increasingly higher fulfillment of success criteria (across the categories) at the very same time. This has also reduced the amount of cross pressures in daily operations and made the existing cross pressures softer. If the criteria in category one are applied at the level of the single institution the complexity will, of course, increase regarding the production and deliv96


ery of the services. A straightforward consequence of this is that the amount of cross pressure in the daily operations will increase. Furthermore, the cross pressures will become harder. This complexity will increase further if a contract model is introduced. It might, then, become untenable for individual institutions to fulfill the criteria at a higher and higher level. It remains to be seen, however, whether or not political-administrative organizations – with support from political systems – can introduce success criteria concerning economic efficiency at the level of the single institution. Managers and employees usually simply think that it is wrong to introduce success criteria concerning economic efficiency at the level of the single institution. Furthermore, a strong and long-lasting alliance between the managers and employees often exists in public institutions with this aim. For these reasons, managers and employees have been quite successful in blocking the implementation of these criteria at the individual institutional level.

Section Seven: Conclusion Which criteria must public institutions fulfill and to what extent are they successful? This chapter has examined this question by focusing on direct external cross-sector success criteria, which were grouped into five categories. The results of a national survey were discussed, which showed that public institutions must fulfill categories two, three, four, and five. Furthermore, the survey showed that public institutions succeed in fulfilling these criteria at a fairly high level. Finally, the survey indicates that in the next few years, public institutions will likely be forced to fulfill category one, as well. This is strongly supported by the long-term development of success criteria, reform(s) in the public sector, more control over the fulfillment of the success criteria by public institutions, and the potential use of a contract model. One consequence of this will likely be that public institutions will be confronted with a larger set of success criteria, leading to increased complexity in the production and delivery of their services. This could also make it more difficult, or perhaps impossible, to fulfil the success criteria. While success criteria concerning economic efficiency could be introduced more widely at the level of the single institution, there is reason to believe that this will be met with resistance. A strong and long lasting alliance between the managers and the employees in public institutions exists, and they have tended to reject the introduction of success criteria at this level. 97


Appendix A: Relevant Questions from The Questionnaire 8. Think of the production of services in your institution. To what extent does the political and administrative system demand … To a great extent That the users and the citizens know the cost of the services in your institution? For example the cost of a pupil in a school or for a room in an old-age home. That your institution is located as close as possible to the homes of the users? For example that a school are located close to the homes of the pupils. That the users can choose an alternative institution if they want? For example choose another kindergarten or old-age home. That your institution produces and delivers the services that users rightly can expect? For example special training of pupils in reading and writing in schools or rehabilitation of senior citizens in old-age homes. That your institution produces and delivers the services in dialogue with the users with the aim to deliver tailored services? That your institution produces and delivers services on the basis of professional criteria and not on the basis of economic criteria? That your institution has transparent criteria for the production and delivery of services? For example transparent criteria for giving pupils special training in reading and writing.

98

To a certain extent

To a low extent

Not at all

Don’t know


9. In your opinion: To what extent is it important … To a great extent

To a certain extent

To a low extent

Not at all

Don’t know

That the users and the citizens know the cost of the services in your institution? That your institution is located as close as possible to the homes of the users? That the users can choose an alternative institution if they want? That your institution produces and delivers the services that users rightly can expect? That your institution produces and delivers the services in dialogue with the users with the aim to deliver tailored services? That your institution produces and delivers services on the basis of professional criteria and not on the basis of economic criteria? That your institution has transparent criteria for the production and delivery of services?

99


10. To what extent does your institution fulfill the demand … To a great extent

To a certain extent

To a low extent

Not at all

Don’t know

That the users and the citizens know the cost of the services in your institution? That your institution is located as close as possible to the homes of the users? That the users can choose an alternative institution if they want? That your institution produces and delivers the services that users rightly can expect? That your institution produces and delivers the services in dialogue with the users with the aim to deliver tailored services? That your institution produces and delivers services on the basis of professional criteria and not on the basis of economic criteria? That your institution has transparent criteria for the production and delivery of services?

12. Think of how your institution, at present, produces and delivers the services. To which extent will structural reform command that your institution … To a great extent Shall produce and deliver the services cheaper? Shall increase the quality of the services? Shall increase the democratic control over the production and delivery of the services? Shall produce and deliver more tailored services to the citizens/users.

100

To a certain extent

To a low extent

Not at all

Don’t know


13. Will your institution, as a consequence of structural reform, fulfill the success criteria of the production and delivery of the services … Much better? Better? Neither better nor poorer Poorer Much poorer Don’t know

14. In your opinion, which scenario is most likely for your institution within the next five years? My institution will merge horizontally, i.e., a merger with institutions producing and delivering the same kind of services. For example, the merger of two schools. My institution will merge vertically, i.e., a merger with institutions producing and delivering different types of services. For example a merger of a school and a kindergarten. My institutions will be fragmented because different departments of the institution will be merged with different institutions. My institution will be closed down. My institution will continue on the basis of business-as-usual. Don’t know.

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19. Which relationship do you have with your employees regarding the production of services? A stable exchange, i.e., the production of services are within rather fixed limits regarding how they are produced, what (groups of) employees produce the different services, and the employment conditions. An open exchange, i.e., the production of services are negotiated with employees regarding how the services are produced, what (groups of) employees produce the different services, and employment conditions. A partnership, i.e., the production of services rest on independent responsibility of employees regarding how the services are produced, what (groups of) employees produce the different services, and employment conditions. Don’t know

20. Which relationship would you prefer to have with your employees? A stable exchange An open exchange A partnership Don’t know

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25. Within which model does your institution operate at present? The budget and monopoly model. Under the budget and monopoly model, it is understood that the important services are produced on the basis of an annual budget and that the institution receives the users more or less automatically. The partnership model. Under the partnership model, it is understood that the important services are produced in collaboration with private firms. The pseudomarket model. Under this model, it is understood that the important services are produced in market-like conditions. The contract model. Under the contract model, it is understood that the important services are produced on the basis of a contract with the municipality. Don’t know

26. Within which model will your institution operate five years from now? The budget and monopoly model The partnership model The pseudomarket model The contract model Don’t know

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Appendix B: The Survey The survey is based on responses from managers of the following public institutions in Denmark: kindergartens, schools, after-school institutions, institutions that specialize in treating disabled persons, and elder homes. These institutions produce and deliver all the core welfare services in the Danish welfare state other than health services. The survey includes questions regarding success criteria, governance structures, dialogue with the political-administration systems, managers’ relationship to the employees, managers’ use of their time on different activities, reforms in the public sector, and innovation. The survey was conducted in November/December 2006. The method of data collection was an internet survey. The manager of each institution received an email including a hyperlink leading to a Web page where the survey could be completed. The managers were promised a summary of the results of the survey if they participated. The managers received the summary on 1 March 2007. The survey includes responses from 759 managers (see table 4.6). The sample consists of 1502 managers, and the response rate of the survey is 51%. The analysis of non-responses shows no significant differences between the sample and the population regarding demographic characteristics. Institutions that specialize in treating disabled persons and elder homes are, however, underrepresented in the sample due to lack of reliable contact addresses. Except for this bias, which is accounted for in the analyses, the survey is representative and the results can be generalized to the population of around 11,000 managers/institutions. Percentage

N

Kindergarten

46

350

School

32

240

After-school

12

89

Institution specialized

7

51

Elder home

4

29

101

759

Total

Table 4.6. Type of Institution

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The method of sampling is that of stratified cluster sampling. The clusters (ninety-eight municipalities) are stratified by geography (five regions) to ensure representation from all parts of the country. In each region, six municipalities were selected based on “probabilities proportionate to size” (PPS) to ensure proper representation of institutions in large municipalities (De Vaus 2002, 75–76). Finally, fifty institutions were randomly chosen in each municipality. The PPS method means that a municipality with 400 institutions has a four times greater chance of being selected than a municipality with one hundred institutions. While large municipalities have a higher probability of being chosen, the same number of institutions in each municipality was chosen regardless of size. This compensated by lowering the probability of a particular institution in the large municipalities being chosen. In general the results of the survey are mostly presented in frequency tables including chi-square test of significance. Only correlations that are significant in a multivariate logistic regression are presented. These regressions include the background variables: gender, age, seniority, education, type of institution, size of institution, size of municipality, and geography. A workshop was held at Roskilde University Centre on 7 February 2007 to interpret and discuss the results of the survey. Both academic scholars and managers participated in the workshop.

References Flyvbjerg, B. 2006. Five misunderstandings about case-study research. Qualitative Inquiry 12(2). –––. 1991. Rationalitet og magt. Århus, Denmark: Akademisk Forlag. Henriksen, H. 1999. Kulturkampen: Bidrag til enhedsskolens historie. Vojens, Denmark: Holger Henriksens Forlag. Hagedorn, P., J. Højland, and J.S. Pedersen. 2006. Strukturreformens konsekvenser for ledere og medarbejdere. Arbejdsliv 4 (December). Hood, C. 1995. The “New Public Management” in the 1980s: Variations on a theme. Accounting, Organizations, and Society 20(2/3).

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Jørgensen, H. Forthcoming. Flexicurity and beyond. Copenhagen: Jurist- og Økonomforbundets Forlag. Indenrigsministeriet. 2004a. Aftale om strukturreform. Copenhagen: Indenrigsministeriet. –––. 2004b. Strukturkommissionens betænkning. 3 vols. Copenhagen: Indenrigsministeriet. Kettel, L. 2001. Skolen i samfundet. Værløse, Denmark: Billesø and Baltzer. OECD (Organization for Economic Co-operation and Development). 2005. Economic survey – Denmark 2005: Key challenges. Paris: OECD. Pedersen, S.J. 2007. Conditions for the managers of public institutions in the Danish welfare state (Rapport om Institutionsledernes vilkår). The Danish School of Public Administration (Danmarks Forvaltningshøjskole). http://dfhnet.dk/kurser_uddannelser.aspx. –––. 2006. Strukturreform og succeskriterier. Nordisk Aministrativt Tidsskrift 2(October). –––. 2004. Nye rammer: Opgaveløsning under og efter strukturreformen. Copenhagen: Børsens Forlag. –––. 2003. Offentlig eller privat? Copenhagen: Samfundslitteratur and Roskilde Universitetsforlag. United Nations Development Programme (UNDP). 2005. International Cooperation at a crossroads: Aid, Trade and Security in an unequal world. New York: United Nations Development Programme. Vaus, D. 2002. Surveys in social research. London: Routledge. Weinrich, T. 2006a. En bedre folkeskole. Copenhagen: Høst og Søn. –––. 2006b En skole er en skole. Berlingske Tidende, 6 April. 106

Chapter 5

Convergent and Divergent Processes of Change in Organizations Exploring Change as Translation in the Encounter of Idea and Practice By John Damm Scheuer

Introduction New institutionalism took “the striking homogeneity of practices and arrangements found in the labor market, in schools, states, and corporations” as its starting place (DiMaggio and Powell 1991, 9). It can be argued that homogeneity in organizational forms and practices occurs across fields because it is more effective and efficient than other types. This convergence, or homogeneity, may simply be an effect of people acting rationally and pursuing their (economic) self-interest; however, the scientific evidence for this being the case is weak (Pollit 2001). Another explanation is provided by neoinstitutionalists like DiMaggio and Powell (1983), who argue that coercive, normative and imitative pressures (e.g., rules and laws, normative pressure in the form of professional norms and networks, common beliefs, and shared and assumed logics of action) direct organization forms and practices in similar directions. Brunsson suggests that “talk, decisions, and products are mutually independent instruments used by the political organization in winning legitimacy and support from the environment” (Brunsson 1989, 27). He points out that there may be a difference between homogeneity and convergence in relation to talk, decisions, and actions. In other words, there may be convergence in talk but not in decisions and actions, or in talk and de-


cisions but not in actions, etc. He suggests that such decoupling between talk, decisions, and actions makes it possible to deal with problems in organizations despite the inconsistent and conflicting norms of stakeholders and conditions of uncertainty and ambivalence. Christopher Pollit (2001) suggests that the idea of homogeneity and convergence in organizational fields is a myth, and that you are just as likely to find divergence and heterogeneity in organizational forms and practices. He suggests yet another explanation based on the idea that the myth of convergence and homogeneity serves the personal interests of individual actors, such as ministers, top civil servants, consultants, and academics. For example, ministers need standardized ideas, such as those related to New Public Management (NPM), because they wish to be perceived as being able to act, and as being sensible and modern, even though they know little about the design of administrative organizations. NPM ideas are also advantageous for top civil servants because the optimal design of administrative organizations is complex and not based on scientific evidence. Consultants, who are often former civil servants, also find NPM ideas advantageous because they can sell them as concepts and models. Academics benefit because they are given something to debate and an object for scientific research. In recent years neoinstitutional researchers have increasingly moved from studying homogeneity and convergence to studying heterogeneity and variation in organizational forms and practices (Greenwood and Hinings 1996; Lounsbury 2001; Ruef and Scott 1998). Lounsbury and Ventresca (2003, 470) suggest that a focus on spatial variation can facilitate analyses of how different positions in a field, relational connections, or identities shape whether organizations adopt novel practices, and how they then implement them. Neoinstitutionalists like Scott et al. (2000) and Powell (1991) have introduced a field-level approach to the analysis of change that aims to uncover the heterogeneity of actors and their practices, as well as the multilevel processes by which fields retain coherence and become transformed (Lounsbury 2003). For example, Scott et al. (2000) has tracked the dynamics of institutional actors, logics, and governance systems in the San Francisco Bay Area healthcare field since the 1940s. They show how field-level changes have been driven not only by the claims and interests of actors but also by shifting belief systems and regulatory structures that took shape at the field level (Lounsbury 2003). As a consequence of these developments, the processes of institutional change may now be considered more complex than formerly assumed. People 108

Convergent and Divergent Processes of Change in Organization

have been assumed by institutionalists to act rationally on the basis of personal or economic interests. They may, however, also act on the basis of social rules and laws, normative pressures, as well as common beliefs, and shared and assumed logics of action. Furthermore, changes taking place at the organizational, field, societal and global level may interact and influence local processes of change. Consequently, Poole and Van de Ven (2004) suggest that researchers should look for the motors that drive change on all of these levels, as well as how they interact in processes of change. Scott et al. (2000) may, again, be mentioned as an example. A recent trend is that institutional and more practice-based perspectives on organizing and change are increasingly being combined in order to understand the micro-processes on which institutional orders are built and changed. In this chapter, I suggest that a new model of institutional change is needed that is able to take into account the complexity of institutional change, as mentioned above. The proposed model focuses on the encounter of an idea and local practice, and theorizes the processes that are set in motion as a translation process. As the point of departure, it is assumed that any type of organizational and institutional change is locally grounded, and that it will be in the encounter and translation processes taking place in and following the encounter that the possible effects of an innovative idea are created. The hypothesis is that processes of homogeneity and convergence, as well as of heterogeneity and divergence, may be explained as consequences of local translation processes. The research questions asked are: 1. How may processes of organizational change be explained and studied as a translation process (i.e., where an idea encounters practice)? 2. How may processes of convergence and divergence in organizations be explained when applying such a perspective on organizational change? To examine these questions, a case study is presented: the activities of a working group that planned clinical pathways in a psychiatric ward at Frederiksberg Hospital, a hospital in the Copenhagen Hospital Corporation. A clinical pathway may be defined as “a standardized, prewritten, one- or two-page document showing the interventions of all disciplines along a time schedule. In effect, it is a grid, with time as one axis and staff actions as the other” (Zander 1995, 9). Clinical pathways were first developed by the nurse Karen Zander and her 109


team at the New England Medical Center Hospitals in Boston (Garbin 1995; Hofmann 1993; Zander 1995). According to Zander, the idea of clinical pathways soon spread internationally because they are nonconceptual, visually appealing, easy to write, and effective in reviewing and decreasing the length of a patient’s stay (1995, 11).

Translation as an Approach to Institutional Change Translation is Introduced in Scandinavian Neoinstitutionalism1 Actor-network theory is based on a constructionist ontology (Callon 1986; Callon and Latour 1981; Latour 2005). It claims that phenomena in the world are coproduced by humans and nonhumans (objects/things). Power, institutions, and knowledge – as well as other phenomena – are all effects of the work of heterogeneous actor-networks. The concept of translation is associated with a network building activity where actors transform tokens (orders, ideas, artefacts, etc.) into something else by translating or associating them with heterogeneous elements that might be human, as well as nonhuman (objects). The diffusion in time and space of tokens (ideas, orders, and artefacts) is assumed to be brought about by people, each of whom may act in different ways: they may

1

ethods used when doing the literature review: Neoinstitutional theory about translation has been M the subject of several literature and research reviews since the 1996 publication of Translating Organizational Change by Czarniawska and Sevón (Røvik 1998; Erlingsdottir 1999; Lindberg 2002; Johnson and Hagström 2002; Scheuer 2003; Boxenbaum 2005). The sources mentioned above were used and supplemented with a literature search in Proquest (ABI inform), JSTOR, and the academic search engine Google Scholar. The search was delimited to texts that relate explicitly to neoinstitutional translation theory: the terms chosen were “translation,” “Czarniawska,” and “institutional theory.” A Proquest search on the basis of the terms “translation” in citations and abstracts, combined with “Czarniawska” in citation and document texts, resulted in nineteen hits. Searching Proquest for the term “translation and Czarniawska” in citation and document texts resulted in forty-five hits. A search in JSTOR, based on the search term “translation and Czarniawska not language,” resulted in sixty-one hits. A Google Scholar search for the term “translation” in all words, and combined with “institutional theory” as a sentence anywhere in the text – and with “Czarniawska” as at least one of the words – yielded eighty-eight hits. Searching Google Book Search for the terms “translation,” “Czarniawska,” and “new institutional theory” yielded seventeen hits, five of which were selected to supplement the books that had already been identified. The articles and books were sorted and grouped in different translation models by reading and skimming book chapters and articles. The translation models were ordered chronologically to reveal how the concept of translation has been translated by Scandinavian neoinstitutionalists from 1996 until 2006, when the literature study was finished.

110


let it drop, modify it, deflect it, betray it, add to it, or appropriate it. Whether ideas or orders become powerful depends on the number of humans and nonhumans that become (or do not become) associated with and start “acting on behalf of ” them during the translation process. Put another way, it depends on whether an actor-network is established or not in relation to a token. In the 1990s, neoinstitutionalists (Czarniawska and Joerges 1996) developed a new theory about organizational change called the idea model, which built on the concepts of translation and actor-network theory, and combined them with Scandinavian institutionalism. The Scandinavian neoinstitutionalists criticized Selznick’s “old institutionalism” and DiMaggio and Powell’s “new institutionalism” for emphasizing stability rather than change in their theories of institutions and institutional change. What they wanted instead was a theory about institutional change that described organizations as characterized by stability, as well as change. For this reason, the concept of translation was emphasized as an especially important and useful concept because it has a richness of meaning, evoking associations with both movement and transformation, and embracing both linguistic and material objects (Czarniawska & Sévon 1996, 3–5, 7). The concept of translation also suggests that the actor has a more active role in the process of institutional change than had previously been considered by American institutionalists like DiMaggio and Powell (1983) and Meyer and Rowan (1983). It also offered a solution to a problem that had been pointed out by other Scandinavian institutionalists: Neoinstitutionalists did not make clear the role of actors and actions in the creation, diffusion, and stabilization of organizational practices (Christensen et al. 1997, 392; Meyer 1996, 242). Scandinavian Institutionalists: Translating Translation Since the mid-1990s, Scandinavian institutionalists have made different translations of the concept of translation. Reviewing the recent literature, one can see seven different models of translation developed by Scandinavian institutionalists (Scheuer 2006):

1. The idea model 2. The editing model 3. The imitation model 4. Kjell Arne Røvik’s model 5. The model of action-nets 111


6. The communication model and 7. The model of association Even though the models share the same basic metaphor of organizational change, they focus on different types of problems and have different views on the process of translation. The idea model (Czarniawska and Joerges 1996) focuses on the movement of ideas in time-space, in and across organizations in organizational fields. It adopts Latour’s definition of the concept of translation as a process where the movement of tokens (ideas, orders, and artefacts) are assumed to be brought about by people who may act differently: it may be dropped, modified, deflected, betrayed, added to, or appropriated. The translation process is constructed by the idea model as a process where an idea is translated to an object, then to actions, and finally into an institution (if the actions are repeated regularly). Nonhumans, such as things, are seen as mediating the translation of ideas into actions and institutions, and as facilitating the travel of ideas when they are translated into decontextualized descriptions of concepts that may be dis- and re-embedded in different time-space contexts. Fashions and culturally embedded master ideas and processes of attention are seen as especially important in relation to the translation process. What is given attention will depend on what the actors know in advance, on cultural assumptions, on political structures, and on what leaders, the market, and the general public find important at a given time and place. The editing model (Sahlin-Andersson 1996) and the imitation model (Sevón 1996) suggest that translations are not random and free but influenced by different types of socially constructed rules. Whether translations follow socially constructed editing rules or are perceived as socially appropriate by organizations is seen as especially important for the content, direction, and effects of the translation process. Røvik (1998) does not define his concept of translation, but describes translation as a process consisting of and influenced by different elements. He suggests that ideas are translated as a consequence of rational calculations, non-intended translations, and organizations’ attempts to clarify their own identities. The translations are taking place in one or more centers of authority in the field, and/or are carried out by leaders and internal and external consultants. The outcome of the translations may be that the idea is concretized, partly imitated, combined with other elements, or remelted (i.e., transformed into 112


something else). The translation process is, moreover, influenced by characteristics related to the idea. Barbara Czarniawska’s theory about action nets (2000a, 2000b, 2005) is a general theory about organizing. It focuses on the problem of how phenomena in the world – actors, organizations, institutions, and intra- and interorganizational relations – are produced and reproduced through action nets. A human actor’s translation, editing, and objectification of ideas in conversations in different time-space contexts is seen as the main process that makes the production of order possible in and between different time-space contexts. Johnson and Hagström (2002) theorize translation as a communication process whereby policy ideas are interpreted and attributed meaning on the basis of local contextual elements that are social, cultural, experience-based, etc. The influence of ideas is related to latent and manifest conflicts between actors with different descriptions and definitions of alternatives, and the attempts of these actors to mobilize others in favor of their specific descriptions and definitions of alternatives. The last model of translation identified is the model of association (Scheuer 2003), which is used in the analysis below.2 This model of translation distinguishes itself from other Scandinavian neoinstitutionalists models of translation on several points that will be explained in more detail after the introduction to the model.

Analytical Perspective Translation as Association in the Encounter of Idea and Practice Czarniawska and Joerges (1996) define ideas as “images which become known in the form of pictures or sounds (words can be either one or another).” The model of association (Scheuer 2003) focuses on how innovative ideas are translated by association with heterogeneous elements – human as well as nonhuman (objects/things) – as the idea encounters local practice in organizations. Translation is defined as one of many alternative ways in which human actors can associate an element such as an idea with other human and nonhuman elements. An idea in a local time-space context, as well as across contexts, becomes more durable

2

T his model was originally developed on the basis of a detailed empirical study, and was one of the results presented in my doctoral dissertation.

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and powerful when there are more humans and nonhumans to act on its behalf. It is suggested that translation processes have to be analyzed by deciding when the translation process under consideration starts and ends, and by dividing the selected time period into episodes. An episode is “a number of acts or events having a specifiable beginning and end, thus involving a particular sequence” (Giddens 1984, 244). The humans and nonhumans associated with the idea during each episode, as well as across episodes, are then analyzed. In order to guide the analysis a number of questions need to be asked. Breaking Down the Change Process Into Episodes 1. Which projects are focused upon and become objects for translation activities during this process? 2. Which actors are responsible for these translation activities? 3. When do the translation activities start and when do they stop? 4. How may the process be organized chronologically into episodes on the basis of these activities? Analyzing the Content and Development During Episodes 5. Which elements (actants) are associated with the idea in each episode? 6. Which kinds of events result in these elements being associated with the idea? 7. What are the relations between the translation activities going on in and between episodes? A project is defined as one or several actors’ “purpose at hand” (Schütz 1973, 9). The process is subdivided into episodes by focusing on when an actor’s idea-related translation activity starts and stops. Any events, including conflicts between humans and nonhumans, that influence the content and development of the idea during and between episodes is identified. On the basis of the analysis, it is decided who the tranlators were, which kinds of translations they made, and what kinds of effects were a result of the idea’s translation. Variables and conditions affecting the content and direction of the translation process are considered empirical questions that have to be answered on the basis of empirical analysis. Existing theories might be used heuristically to set-up hypotheses about which variables and conditions influence the translation process. The effect of the translation of an idea is assumed to be the result of the established local, as well as global, collective of humans and nonhumans 114


acting on behalf of a token as an idea. Sometimes the work done by humans and nonhumans is black-boxed. In other words, translators forget, overlook, or take the work done by actors for granted. Technological and material complexity may be shut in in computers until the computer breaks down and requires an expert to come and fix it. A certain division of labor may also be blackboxed until the introduction of an innovative idea suggests that the division of labor ought to be organized differently Institutionalization is considered a relatively stable association of heterogeneous elements with an idea in time and space. De-institutionalization, on the contrary, is associated with the dissolution of such a relatively stable association. Stable associations of heterogeneous elements in time and space are referred to as translation bundles. When ideas have been institutionalized, they appear as translation bundles (i.e., bundles of humans and nonhumans) that actors can mobilize routinely in order to produce and reproduce organizational practices. The results of the analysis performed using this model are organized around four questions: 1. Who were the translators? 2. Which translations were made? 3. What kind of events resulted in these elements being associated with the idea (i.e., these translations)? 4. What were the effects of these translations? The methods used in order to generate and analyze data are described elsewhere. In relation to the analysis, it should be noted that it was guided by two simple principles from actor-network theory: 1) follow the actor (i.e., follow the token in focus – in this case the idea of clinical pathways, and 2) follow the controversies (i.e., the conflicts that occurred as translators started associating humans and nonhumans with the idea). Therewith, if no conflicts or controversies were identified in the analysis of the two cases it was because no conflicts were detected in the data.

The Model of Association Compared to Other Models The models of translation of the Scandinavian institutionalists are based on a social constructivist ontology. The model of association is, however, based on a 115


constructivist rather than a social constructivist ontology. Consequently, the focus is not on the attributed meaning and social constructions of actors, but rather on the network building activities and work done by human and nonhuman actors as they construct phenomena in the world. It is supposed that humans and nonhumans may do work that is directly related to institutional production, reproduction, and change. And that non-humans need not only do mediating work as suggested by the idea model. Inspired by actor-network theory, the model of association does not make a priori assumptions. In other words, it does not assume in advance that the translation of ideas is influenced by elements such as fashions, culturally embedded master ideas and processes of attention, an actor’s knowledge, cultural assumptions, political structures, and what leaders, the market, and the general public find important. Neither is it assumed in advance that the translation process is influenced by editing rules, a logic of appropriateness, or latent and manifest conflicts between actors with different descriptions and definitions of alternatives that may be more or less mobilizing to actors. Pressures or factors that may result in organizational and field-level homogeneity and convergence, or the opposite, are also not proposed in advance. All these suggestions and hypothesis are turned into empirical questions in the model of association rather than proposed as constitutive for the analysis. As a consequence, the model of association is best described as a simple tracking device, making it possible to follow and analyze processes of organizational and institutional change while detecting influences, such as those mentioned above (if they may be constructed on the basis of data). It also makes it possible to detect other types of elements or actants that had an influence on the content and direction of a given translation process. The main difference between the models of translation in actor-network theory and the model of association is that the latter sees time and space as constitutive for the translation process while the former does not. Consequently, the ontology of actor-network theory may be criticized for being out of touch with the world we live in. It seems to suggest an ontology that is in accordance with a society where the majority of the translation processes take place in cyberspace, or through other means of communication, making it possible to ignore the situatedness of and distances between the body and objects in time and space. Even though such societies do exist – for instance, in cyberspace – they are still quite rare. Unlike most of the neoinstitutionalist models of translation, the model of association does not focus on how ideas travel in and across organizations in 116


organizational fields. It focuses on what happens in the encounter between an innovative idea and practice in organizations. The approach may be seen as an answer to Lounsbury and Ventresca’s (2003, 470) call for neoinstitutionalists to focus on temporal and spatial variation in order to analyze how different positions in a field, relational connections, or identities shape the decision of organizations to adopt novel practices and how they implement them.

Analysis3 Introduction to the Two Cases When the Copenhagen Hospital Corporation was formed in 1995, a hospital plan was made that introduced several new ideas related to NPM, including quality development and clinical pathways. As a result of the plan, several new centers, specializing in basic surgery and medicine, were established at the Corporation. Frederiksberg Hospital was one of the smaller hospitals in the Corporation. The plan called for an elective surgery center and a center for medicine to be established at the hospital. Departments from several hospitals were merged in order to establish these centers. The plan also called for some services of the hospital’s psychiatric ward to be reorganized. According to the corporation’s quality development plan, all centers and departments were expected to start reorganizing their patients’ pathways and to plan them rationally in order to use resources more effectively and improve their quality. To facilitate this reorganization, Frederiksberg Hospital formed subgroups focusing on quality development and clinical pathways that were under the project groups planning the establishment of the elective surgery center and the center of medicine, as well as the reorganization of the psychiatric ward. Following, is an analysis of the cases, focusing on the planning of the clinical pathways in the subgroups that planned clinical pathways in the clinic for orthopaedic surgery – one of the clinics in the elective surgery center – and in the psychiatric ward. 3

T he two cases were selected because the content and techniques used to describe clinical pathways were different, because the number of conflicts involved in introducing clinical pathways varied a lot and because the amount of time needed to translate the idea of clinical pathways was much longer in one of the units (the psychiatric ward) compared to the other (the Clinic for Orthopaedic Surgery). The collection of data was based on document studies, interviews and observation in situ. Data were organized chronologically and then broken down and analyzed by asking the questions described in the model of association.

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Analysis of First Case Translation of Clinical Pathways in the Clinic for Orthopaedic Surgery The subgroup that planned clinical pathways in the clinic for orthopaedic surgery had twelve members. The professional groups represented were doctors, nurses, physio- and occupational therapists, and secretaries. Management was represented by a surgeon who was also leader of the clinic and nurse officers. First Episode: August–September 1996

The planned opening for the elective surgery center was 1 January 1997, which required that the planning of clinical pathways had to be finished by that date, or as soon thereafter as possible. The project group responsible for the planning of the center decided that its clinics needed some advice about how to describe and plan clinical pathways, so the hospital’s planning and development department was asked to produce a written proposal suggesting how the clinics might describe and plan clinical pathways. Two proposals were produced by a development consultant, which represented a re-engineering approach to the description and planning of clinical pathways. According to the proposals, the clinics should describe and analyze the patient’s pathways in order to reduce organizational as well as material “slack.” Processes should be reorganized if necessary, and measured and benchmarked continuously against preset quality standards in order to assure quality development. The development consultant’s first proposal was used to translate clinical pathways in the subgroup that planned clinical pathways in the clinic for ortopaedic surgery. The proposal was used in a discussion aimed at dividing the clinical pathway for patients who were having their hips replaced into chronologically organized phases. The proposal, and the translation that it represented, did not, however, have an effect on the translation process that followed since no one associated with, or decided to work on behalf of, the translation that it represented. Second Episode: September–October 1996

A doctor and a nurse officer in the subgroup were asked by other members of the subgroup to make a proposal describing how clinical pathways for patients having their hip and knee replaced might be described and analyzed. The doctor suggested that there were two aims for clinical pathways. First, clinical pathways were seen as a tool that made it possible for clinicians to live up to 118


external demands for documentation of patients’ pathways. Second, they were seen as a tool that made it possible to analyze what professionals did with patients, and to identify what could be done better. The external demand by hospital managers, external auditors, and medical officers to document patients’ pathways was seen as relevant and legitimate, and as an expression of public servants wanting to get more detailed insight into what happened to different types of patients. Outside intervention in patients’ pathways was, however, seen as illegitimate because external civil servants did not possess the necessary knowledge about local practices and the specific medical specialty under consideration. The group members themselves did not think that they needed descriptions of clinical pathways, since these types of pathways were already very well-known. The translation of clinical pathways was simple and actionoriented. The doctor and the nurse suggested, and succeeded in convincing, the subgroup that describing clinical pathways simply meant articulating what professionals used to do in the old department of orthopaedic surgery that was now to be transformed into a clinic in the elective surgery center. Moreover, the types of objects that were related to clinical pathways were descriptions of what healthcare and other professionals involved in patient pathways normally did in relation to hip patients in this department. First, the patient pathway for hip patients was divided into phases, and the tasks that were normally solved during each phase were identified and written down. Second, more specific detailed documents were created that described what was normally done to patients before and after an operation, and in relation to nursing, mobilizing, and informing them. According to informants, the descriptions of what was normally done in relation to the group of hip patients did not change much. The descriptions contributed, however, by making it possible for patients to experience a more continuous pathway: The different groups of professionals found out what other groups did, or needed to do, in relation to hip patients. The most important effect of the translation work done in the subgroup was that it produced a knowledge base, which was, in turn, translated again and used by a nurse to generate clinical pathways in the subsequent episode. Third Episode: October 1996–February 1997

At the beginning of this episode, the doctor who had been appointed as the new leader of the clinic entered the scene. He and a nurse officer who was a member of the group that was planning clinical pathways took over that task. The formally appointed subgroup planning clinical pathways was shut down, 119


and no conflicts with its members occurred. (Probably because living up to external demands for documentation by civil servants was not a high priority for members of the group.) The leader thought that the clinic had few and relative homogeneous groups of patients, and that the treatment and care of these patients was well-known. The leader of the clinic and the nurse now made two different types of translations of clinical pathways. The first translation turned clinical pathways into a total concept that related clinical pathways with a broad spectrum of loosely coupled elements: a model program describing the clinical pathway for patients; cross-disciplinary teams and nursing teams related to each patient; a booking system; quality standards related to performance measurement; a survey system aimed at measuring patients satisfaction with pathways; and clinical databases in which data were supposed to be stored for further analysis and, if necessary, intervention in relation to clinical pathways. This type of translation occurred in reports to the project group that was planning the elective surgery center, and happened to be in accordance with how civil servants in the Copenhagen Hospital Corporation were translating the concept of clinical pathways. The second translation turned clinical pathways into a management tool called the model program. It consisted of an eleven-page document describing: the different phases of the clinical pathway for hip patients; the tasks that should be undertaken in each phase; the activities related to solving each task; an abbreviation indicating which professional group were responsible for solving each task; and the standard measurements related to phases and tasks as well as the registration of data in related systems. The leader of the clinic used this document as an opportunity to start-up a dialogue and create consensus among professionals in the clinic regarding the current clinical pathway for hip patients. He also saw and used it as a social and written contract that codified how clinical pathways of hip patients should be handled in the clinic. The leader related clinical pathways with a hierarchical social structure by suggesting that it was the most specialized and experienced doctors in relation to hip and knee patients – as well as other groups of patients – who were the main persons responsible for the descriptions of clinical pathways for these patients. The standardization that resulted from this way of translating clinical pathways resulted in a conflict with doctors in the clinic. The doctors wanted to decide which type of hip prosthesis to use while the leader of the clinic wanted standardization, and to use only one type. This was seen as an illegitimate interference in the doctors’ professional autonomy – a strong principle and value 120


among doctors in the clinic. The nurses welcomed, however, the standardization because they found it easier to follow a standard than each doctor’s suggestions and ideas about how to treat hip patients. Yet another group wanted things to stay as they were. Practices in the clinic were, however, changed in spite of these objections. The effect of the translation of clinical pathways into a total concept was that the clinic of orthopaedic surgery, as well as the elective surgery center, were legitimized in relation to actors in the environment (e.g., the civil servants in the Copenhagen Hospital Corporation, in hospital management, and in the hospital’s planning and development department). The effects of translating clinical pathways into a management tool in the form of an object – a model program – was that a process was set in motion in which agreements (i.e., social contracts) among professionals about the clinical pathways of hip patients were negotiated and written down. The model program had effects because it became the object to which employees referred when they talked about clinical pathways. Moreover, when – in their final report to the Copenhagen Hospital Corporation – the doctor and nurse who were managers of the elective surgery center decided to present the model program from the clinic of orthopaedic surgery as the standard way of describing clinical pathways in the center, it became an internal as well as external symbol of rationally planned pathways. The model program also confirmed the hierarchical social structure that characterized social relations in the department.

Analysis of Second Case Translation of Clinical Pathways in the Psychiatric Ward The subgroup that planned clinical pathways in the psychiatric ward had eleven members. The professionals represented in the group were psychiatrists, nurses, physio- and occupational therapists, psychologists, and social workers. Management was represented by the head of department who was also a psychiatrist, and two nursing officers. The hospital’s planning and development department was represented by a development consultant. First Episode: April 1997–January 1998

The psychiatrist who was chairman of the subgroup and the development consultant shared had a common definition of a clinical pathway. They started out suggesting that the aim of the subgroup was to describe an evidence-based 121


clinical pathway for psychiatric patients, and to assure – and if necessary develop – the quality of this pathway by measuring performance in relation to preset quality standards. The work with clinical pathways was supposed to give an insight into the quality of treatment and care of patients, to contribute to improving the quality of pathways, and to assure that personnel and other resources were used as effectively as possible. Patients were supposed to be included in the subgroups work, but never were. Because approximately ninety percent of the patients in the psychiatric ward were acute, the subgroup decided to describe an ideal clinical pathway for acute psychiatric patients instead of for groups of patients with specific diagnoses. The group also decided to begin by describing an ideal pathway for these patients. The pathway of acute psychiatric patients was divided into phases and the tasks that had to be taken care of in each phase were identified and written down (i.e., objectified). The division of labor into central and peripheral tasks, as well as the construction of a written and ideal description of the clinical pathway for acute psychiatric patients, opened a discussion of the best division of labor between professionals involved in the pathway, effectively turning a subject that had previously been black-boxed (Latour 1987) and that represented tacit knowledge into an object of discussion. The discussions resulted in a time delay. The psychologist entered the discussion and suggested that the quantitative approach to quality development of clinical pathways suggested by the chairman and the development consultant was insufficient in relation to psychiatric patients since psychiatric patients could not be standardized. She suggested an alternative qualitative approach based on the idea that the continuity and quality of psychiatric patients’ pathways could only be assured if based on common knowledge about the cross-disciplinary treatment of psychiatric patients. The psychologist also pointed out that the psychiatrists in the ward did not agree on how to treat the patients, rendering the construction of standardized pathways difficult. Consequently, the chairman informed the project group and the planning and development department that the group needed more time to finish its work. Second Episode: January–September 1998

In the second episode, the role as chairman was taken over by the psychiatrist who was head of the department because the head nurse and the planning and development department were unsatisfied with the lack of progress in the subgroup’s work. The chairman wrote a plan suggesting that quality develop122


ment of pathways had to be based on a cross-disciplinary perspective on psychiatric illness since the psychiatric patient is more complex than suggested by the psychiatrist’s biological, psychological, and social-network perspectives on psychiatric illness. The chairman constructed his own version of the qualitative approach to development of pathways, focusing on quality development of cross-disciplinary information used in decision making and development of the processes and objects involved in cross-disciplinary coordination and communication between professionals. The objects produced during the episode included descriptions/reports about the information needs of involved professional groups, as well as descriptions of the types of treatments each group could offer the patients. The activities also included a specification of the division of labor between one or two professionals who met the acute psychiatric patient, and two cross-disciplinary teams that used the information collected by these persons to decide where to place, and how to diagnose and treat the patient in focus. Since the cross-disciplinary perspective made all professional groups equally important, the effect of this translation proposal was that the discussion of the division of labor between professional groups and the division of tasks into main and peripheral tasks were closed down. Another effect was that an alternative perspective on quality development of pathways was developed, which is adjusted to local knowledge, as well as to professional interests. At the end of the episode a conflict arose between nurses and other professionals in the clinic. The head of department had suggested that professionals other than nurses should be allowed to help psychiatrists when they met patients in order to diagnose or treat them. The nurses solved the conflict by referring to the law. Since nurses are authorized to delegate work to all other professional groups except doctors, while professional groups – other that doctors – are not, it is not possible for other types of professionals to replace nurses. Third Episode: October 1998–December 2000

In the third episode, the representative from the planning and development department made the writing group and the head of department aware that external groups might have a quantitative rather than a qualitative perspective on quality development of pathways. The activities in the subgroup were directed at producing flowcharts and standards/goals related to the pathway of acute psychiatric patients. Their effectiveness was, however, limited since the professional groups and managing psychiatrists made sure that standards and goals 123


were only mentioned as “examples” in the final report, and not as something that should be put into practice in the ward. Consequently, the subgroups final report may be described as a hybrid. On the one hand, it may be read as being in accordance with the quantitative approach since it includes elements such as flowcharts and standards/goals normally related to this approach. On the other hand, the report sums up the work done in the subgroup on the basis of the alternative qualitative approach. The development activities that followed the report were, however, related to the qualitative rather than the quantitative approach. The effect of the translation process was that the produced report legitimized the activities that had been occurring in the ward in relation to external actors, as well as summed up the results of the development activities internally. The report also served as a point of departure for, and a way to legitimize, new development activities that are related to the qualitative rather than quantitative approach to quality development of pathways.

Comparison of Cases Firstly, it may be noted that the time used to translate the idea of clinical pathways was different in the two units. In the clinic for orthopaedic surgery, the translation process took approximately seven months, while in the psychiatric ward the translation process took much longer. In sum total, it took three years from start-up until the final report was delivered. In the clinic, hip patients were seen as relatively easy to diagnose and the technologies needed to treat and take care of the patients were considered wellknown. As a consequence, the standardization implied by the idea of clinical pathways was easily achieved and less time-consuming. In the ward the patients’ illnesses were, however, seen as so complex that a cross-disciplinary perspective on the illnesses was needed. In order to handle the complexity that the psychiatric patient represented it was decided that the psychiatrist’s biological, psychological and social-network perspectives on psychiatric illness should be supplemented with every other professional perspectives on psychiatric illness and treatment. The standardization implied by the idea of clinical pathways was difficult to achieve and thus more time-consuming, eventually ending with the reinvention of the idea of clinical pathways in the psychiatric ward. The number and level of conflicts in the two departments were also different. In the clinic, there were fewer and less serious conflicts than in the psychiatric ward. In the clinic, conflicts arose when the professional autonomy of doctors – a 124


highly-regarded value – was effectively challenged by the leaders who wished to introduce standard hip prosthesis. In the ward, more serious and time- consuming conflicts arose over the division of labor between professional groups in the ward and over how the idea of clinical pathways ought to be translated. In the clinic, the idea of clinical pathways was translated into a management tool that was objectified in the model program. The leader of the clinic used this object to start up a dialogue and create consensus among its professionals about what the clinical pathway of hip patients did or should look like. He also saw and used it as a social and written contract about how clinical pathways of hip patients should be handled in the clinic. In the ward clinical pathways were, however, first translated into a method that could be used to re-engineer processes in the ward. Later, the idea was related to quality development of cross-disciplinary information used in decision-making and quality development of processes and objects involved in coordination and communication between professionals working in cross-disciplinary teams. Karen Zander defined the concept of clinical pathways as “a standardized, prewritten, one- or two-page document showing the interventions of all disciplines along a time schedule.” She noticed that it, in effect, was “a grid, with time as one axis and staff actions as the other” (Zander 1995, 9). During the process of translation, the concept of clinical pathways originally suggested by Karen Zander was transformed in the clinic and in the psychiatric ward, though some elements remained the same across all three types of translations, namely the more simple idea that clinical pathways may be related to descriptions of processes with time as one axis and staff actions as the other. It was the association of other types of elements to the idea of clinical pathways that resulted in the idea being translated differently in the different time-space contexts. The phases and tasks in each part of the clinical pathways were identified in both cases. In the clinic a model program was, however, attached to the idea of clinical pathways while the different professional groups’ descriptions of their information needs were attached to the idea in the psychiatric ward. As briefly noted above, the social structure and related clinical pathways in the clinic were hierarchical. The individual doctors who were formally the experts in relation to specific groups of patients (e.g., hip patients, patients having their knees replaced, etc.) were given responsibility for the design of the clinical pathways of these patients. In the psychiatric ward, another type of social structure was related to clinical pathways. Here it was the cross-disciplinary team that was related to the clinical pathway. 125


The departments’ relationships with their environments were also different. In the clinic, the relationship with hospital management, the planning and development department, and the civil servants in the Corporation were not based on conflict. The translation made of clinical pathways in the clinic was generally in accordance with how these groups translated the concept, and thus was seen as legitimate by these actors and the clinic’s clinicians. In the ward the qualitative approach to clinical pathways was, however, perceived as conflicting with these groups’ way of translating the idea of clinical pathways. As a consequence, complicated flowcharts and quality standards were constructed and included in a report that turned out to be a hybrid summing up the work done in relation to the quantitative, as well as the qualitative, approach to clinical pathways. It thereby served a double purpose: 1) to sum-up the work that had been done and 2) to legitimize the activities in the ward vis-a-vis external actors. Finally, the outcomes related to the work with clinical pathways were different in the two units. In the clinic, the most important outcome of the translation process was the introduction of the model programme, which was constructed as a management tool. In the psychiatric ward, the most important outcome of the work with clinical pathways was the learning process that was set in motion in many different areas in the ward as a consequence of the subgroups’ work with the idea of clinical pathways.

Discussion In this chapter, the model of association was offered as an alternative to existing models of translation in neoinstitutional theory. Instead of focusing on the travel of ideas in and across organizations in organizational fields, as do most models, the presented material focused on the translation of ideas in the encounter between an idea and local practice. The empirical insights provided by the analysis based on the model of association will be discussed in detail in the following sections. How May Processes of Organizational Change be Studied and Explained as a Translation Process, where an Idea Encounters Practice? On the basis of a review and discussion of existing neoinstitutionalist models of translation, an alternative model focusing on the encounter of idea and practice in organizations was introduced. 126


The model of association (Scheuer 2003) focuses on how innovative ideas are translated through association with human as well as nonhuman elements, as an idea encounters local practice in organizations. Translation was defined as one of many alternative ways in which human actors can associate an element, such as an idea, with other human and nonhuman elements. It was suggested that an idea can become powerful depending on the number of human and nonhuman elements that are acting on its behalf. It was also suggested that translation processes have to be analyzed by dividing them into episodes and deciding upon which human and nonhuman elements are associated with an idea during each episode, as well as across episodes. Finally, institutionalization was conceived as the relatively stable association of heterogeneous elements to an idea in time and space. De-institutionalization, on the contrary, was conceived as the dissolution of such relatively stable associations. As demonstrated by the analysis, the model of association gives a new and more detailed insight into the translation of ideas as they encounter practice in organizations. It may be concluded that an idea and the human and nonhuman elements associated with it are co-constructed in specific time-space contexts. An idea may be translated in ways that render it more or less different. Its translation may result in both intended and unintended consequences, depending on how and which elements are associated with the idea in a specific time-space context (Giddens 1984). Different human and nonhuman elements may be mobilized by, or force themselves upon, the translators in different time-space contexts, resulting in ideas being translated in directions that may be difficult to foresee. The translators in the two case studies differed in their constructions of the patient, the kind of technologies needed to treat and take care of patients, the relevant social structure, and actors in the environment. Moreover, the translators’ constructions of their own identities (as in the psychiatric ward, where the quantitative approach was seen as incompatible with a patient population who could not be standardized) seemed to play a role. Different graphical and text-based techniques were used to describe the clinical pathways. The tacit political and management structures of the two units seemed to play a role, too, which resulted in the two doctors who were the leaders of the clinic and the psychiatric ward playing a key role in the translation of the idea of clinical pathways in their respective departments. Leadership was, however, also exercised in practice by other professionals such as the psychologist. Generally, leadership was exercised by translators who were able to put forward transla127


tion proposals (i.e., proposals about how to associate elements to the idea of clinical pathways) that mobilized support from internal and external actors (actants). There were also elements that forced themselves upon the translators, and disturbed and limited the translation process. One such element was time, which played a role in the translation of clinical pathways in the clinic. The deadline for opening the elective surgery center put pressure on the planning of clinical pathways, which had to be finished at that date or as soon after as possible. In the psychiatric ward, time also played a role when the head nurse and the planning and development department put pressure on the ward’s leader to assure progress of the subgroups work. Conflicts occurred when central values and vested interests (e.g.., the autonomy of doctors) were affected by the translation of clinical pathways. The division of labor between professional groups, as well as the operative distinction made between central and peripheral tasks, impacted the translation work done in the two departments. This happened when the black box of tacit knowledge about these issues was opened up as a consequence of the translation activities related to clinical pathways. The need for organizational development in the psychiatric ward also became apparent, and forced itself upon the translators as their knowledge about practices in the ward was built up. One example of this was the need for an agreement about how to choose between the biological, psychological and social-network perspectives on psychiatric illness that resulted from the translation activities related to clinical pathways. One may ask whether or not the idea of clinical pathways was institutionalized in the two organizational units that were analyzed. In order to fully answer that question, more time would have been needed. It may, however, reasonably be suggested that the model program and the actants attached to it were institutionalized in the clinic. In other words, they represented a relatively stable association of heterogeneous elements, related to the idea of clinical pathways in time-space. Whether the quantitative and subsequent qualitative translations in the psychiatric ward resulted in their institutionalization remains, however, an open question. By the end of the study, the qualitative approach seemed the most stable association of elements between the two. As demonstrated by this study, the translation of clinical pathways or other ideas as fact building is hard work and may result in later path-dependency: So much organizational learning and work go into associating a specific idea with a specific set of local human and nonhuman elements that it become difficult 128


for later actors to change these constructions. The amount of work related to organizational change may, therefore, easily be underestimated. Additionally, the speed with which organizational change can occur may also be easily overestimated. A crisis in an organization may make organizational change easier because translators are given more freedom to introduce and translate new ideas, as well as translate existing ideas in novel ways by attaching new types of elements to them. Existing ideas may also be de-institutionalized. Yet another type of change is evolutionary institutional change where the elements normally associated with an idea are changed, but slowly. The characteristics of the translation process include bricolage and improvisation – associating humans and nonhumans to ideas until attractive and desirable effects occur locally – and are central activities when translating innovative ideas as they encounter practice in organizations. The effectiveness of an idea will depend on the types of elements that are present locally and on which elements translators happen to succeed in associating with it. The relationships with humans and nonhumans involved in the translation process will most likely be both consensual and conflictual, and vary over time. The types of knowledge one needs as a translator, in order to make change occur, are specific to local human and nonhuman elements. These elements include those that can be mobilized as well as those that require handling, because they force themselves upon the translation process. When Applying the Model of Association, How Can Processes of Convergence and Divergence in Organizations be Explained? What may explain why and how new ideas such as “clinical pathways” are introduced in organizations? At the beginning of this chapter, different explanations were put forward to explain homogeneity and convergence in organizational fields. Convergence and homogeneity may simply be an effect of people acting rationally and pursuing their (economic) self-interest. Another possibility is that humans, when confronted with coercive pressures (e.g., rules and laws, pressures in the form of professional norms and networks, and common beliefs and shared and assumed logics of action) will act in ways that direct organizational forms and practices in similar directions. Yet another argument could be summarized by suggesting that “talk, decisions, and actions are mutually independent instruments used by the political organization in winning legitimacy and support from the environment” (Brunsson 1989, 27). It was pointed out that there might be a difference between homogeneity and convergence in 129


relation to talk, decisions, and actions. Pollit (2001) suggested that the idea of homogeneity and convergence in organizational fields might be a myth, and that this myth served the personal and political interests of individuals such as ministers, top civil servants, consultants, and academics. On the basis of the analysis it may be concluded that clinical pathways were introduced and translated in the clinic for orthopaedic surgery and the psychiatric ward because hospital management, the hospital’s planning and development department, as well as the professionals planning the reorganization of the two units all chose to act on behalf of the Corporation’s plans and directives. It was thus rule following (the following of plans and directives) in practice rather than rational calculations, the pursuit of political interests, the following of professional norms or imitation of legitimate cultural templates that resulted in work being done in relation to clinical pathways in the two units. The local health care professionals themselves did not introduce the idea of clinical pathways or share assumptions about them, other than that they already knew a lot about clinical pathways from their everyday work. The decisions and actions of translators in the clinic were, to a certain degree, in accordance with the “talk” presented to hospital management, the planning and development department, and civil servants in the Copenhagen Hospital Corporation. In the psychiatric ward, the subgroups’ final report represented a hybrid and covered-up the fact that the decisions and actions in the ward were decoupled from the talk. What conclusions can be drawn from the discussion of homogeneity and convergence versus heterogeneity and divergence? As a consequence of the contextual and processual complexity of translation processes, it is unlikely that an idea that has been translated in one time-space context may travel and be translated in a similar way in another. Ideas may be associated with human and nonhuman elements in ways that seem to make them similar, but only to a degree. It may, therefore, be more appropriate to talk about a range of outcomes of the translation process (the association of elements) that may be constructed as being more or less convergent with, or divergent from, an original idea. In the analysis of the case studies, it became apparent that elements remained the same when translations were compared; clinical pathways may be related to descriptions of processes with time as one axis and staff actions as the other. While this basic idea remained the same across all types of translations, it was the association of other types of elements to the idea of clinical pathways that resulted in the idea being translated differently in the various time-space 130


contexts. It seems fair to suggest, however, that the range of translations of the idea of clinical pathways corroborates that the translators in the studies were, in fact, solely working with the idea of clinical pathways. The array of translations represented may be considered as within the range of types of translations that might be related to the concept of clinical pathways. This points to the need for an increased awareness of the range or type of translations that may or may not be related to a specific idea in different time-space contexts. This analysis pivotally suggests that processes of organizational change cannot be easily reduced to explanations that build on simplistic and often partly mistaken theories about the nature of change processes and what drives human action. When scrutinized in detail, and from the perspective of the model of association, the actions of translators and humans and nonhumans turn out to be more complex than suggested by the explanations of homogeneity and convergence mentioned above. The model of translation works as a sort of tracking device that makes it possible to detect who the translators of an idea are, which translations they made, and how organizational, field, societal, and global elements influenced the direction and content of local translations. Finally, it makes it possible to identify the effects that result from translation (e.g., which types of elements were associated with the idea of clinical pathways).

Conclusion Two research questions have been addressed in this chapter: 1. How may processes of organizational change be studied and explained as a translation process where an idea encounters practice? 2. How does this perspective help explain the processes of convergence and divergence in organizational change? On the basis of a review and discussion of existing neoinstitutionalist models of translation, an alternative model focusing on the encounter of idea and practice in organizations was introduced. It was used to analyze the encounter of the idea of clinical pathways and practice in the clinic for orthopaedic surgery and psychiatric ward at Frederiksberg Hospital. The model of association focuses on how innovative ideas are translated through association with human as well as nonhuman elements, as an idea encounters local practice in organizations. It suggests that translation processes have to be analyzed retrospectively by dividing them into 131


episodes and by deciding which human and nonhuman elements were associated with an idea during each episode, as well as across episodes. In the clinic for orthopaedic surgery, the idea of clinical pathways was first translated into a method that could be used to re-engineer patients’ pathways. Then it was translated into a tool that made it possible for clinicians to meet external demands for the documentation of patients’ pathways, to analyze what professionals did with patients, and to identify what could be done better. The idea was then translated into a model program that was used as a management tool by the leader of the clinic. In the psychiatric ward, the idea was first translated into a quantitative approach to clinical pathways that emphasized the importance of developing the quality of clinical pathways on the basis of systematic measurements of differences between an ideal and a factual pathway for hip surgery patients. Subsequently, the idea was translated into a qualitative approach that emphasized the importance of focusing on quality development of cross-disciplinary information used in decision-making, and of the processes and objects involved in cross-disciplinary coordination and communication between professionals. On the basis of the detailed empirical analysis of the translation process in the two organizational units, it is concluded that an idea and the human and nonhuman elements associated with it are co-constructed in specific time-space contexts. An idea may be translated in ways that are similar to, as well as different from, its original form. It may also be translated in ways that result in intended as well as unintended effects, depending on how and which elements are associated with the idea in a specific time-space context. Different human as well as nonhuman elements may be mobilized by or force themselves upon the translators in different time-space contexts, resulting in ideas being translated in directions that may be difficult to foresee. The translation of clinical pathways or other ideas as fact building is hard work and may result in path-dependency. Finally, ideas may develop in an evolutionary way while a crisis may lead to deinstitutionalization and more radical forms of institutional change. As a consequence of the characteristics of the translation process, bricolage and improvisation – associating humans and nonhumans to ideas until attractive and desired effects occur locally – are central activities when translating innovative ideas as they encounter practice in organizations. This is because the effects of an idea will depend on the types of elements that are present locally and on which of these elements translators happen to succeed in associating with an idea. 132


On the basis of the analysis it may be concluded that clinical pathways were introduced and translated in the clinic for orthopaedic surgery and the psychiatric ward because of rule following (the following of plans and directives) in practice rather than because of rational calculations, the pursuit of political interests, the following of professional norms or imitation of legitimate cultural templates. The local health care professionals did not introduce the idea of clinical pathways or share assumptions about them, other than that they already knew a lot about clinical pathways from their everyday work. As a consequence of the contextual and processual complexity of translation processes, it is unlikely that an idea that has been translated in one time-space context may travel and be translated in a similar way in another time-space context. A conclusion is that ideas may be associated with human and nonhuman elements in ways that seem to make them similar to some degree. As a consequence, it may be more appropriate to talk about a range of outcomes of the translation process (the association of elements) that may be constructed as being more or less convergent with or divergent from an original idea. A final and central conclusion is the suggestions that processes of organizational change are irreducible to simple explanations building on simple and partly mistaken theories about the nature of change processes and what drives human action. When scrutinized in detail, and from the perspective of the model of association, the actions of translators and humans and nonhumans turn out to be more complex than suggested in the explanations of homogeneity and convergence that were mentioned above.

References Boxenbaum, E. 2005. Institutional Genesis: Micro-dynamic foundations of institutional change. Ph.D. diss., Copenhagen Business School. Brunsson, N. 1989. The organisation of hypocrisy: Talk, decisions, and actions in organisations. Chichester, U.K.: John Wiley. Callon, M. 1986. Some elements of a sociology of translation: Domestication of the scallops and the fishermen of St. Brieuc Bay. In Power, action, and belief: A new sociology of knowledge?, edited by J. Law. London; Routledge and Kegan Paul.

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Callon, M., and B. Latour. 1981. Unscrewing the big Leviathan: How actors macro-structure reality and how sociologists help them to do so. In Advances in social theory and methodology: Toward an integration of micro- and macrosociologies, edited by Knorr-Cetina and A.V. Cicourel. Boston: Routledge and Kegan Poul. Christensen, S., P. Karnøe, J. Strandgaard Pedersen, and F. Dobbin. 1997. Action in institutions. American Behavioral Scientist 40(4). Czarniawska, B. 2005. En teori om organisering. Lund, Sweden: Student litteratur –––. 2000a. Att studera management som skapande och återskapande av handlingsnät. Nordiske Organisasjonsstudier 2(3):5-24. –––. 2000b. A city reframed: Managing Warsaw in the 1990s. Reading, U.K.: Harwood Academic Publishers. Czarniawska, B., and B. Joerges. 1996. Travels of ideas. In Translating organizational change, edited by B. Czarniawska and G. Sevón. Berlin and New York: Walter de Gruyter. DiMaggio, P.J., and W.W. Powell. 1983. The Iron Cage revisited: Institutional isomophism and collective rationality in organization fields. In The new institutionalism in organizational analysis, edited by P.J. DiMaggio and W.W. Powell. Chicago and London: University of Chicago Press. Erlingsdottir, G. 1999. Förförande idéer Kvalitetssäkring i hälso-och sjukvården. Lund, Sweden: Ekonomihögskolan, Lunds Universitet. Garbin, B. 1995. Introduction to clinical pathways. Journal for Healthcare Quality 17(6). Giddens, A. 1984. Constitution of society: Outline of the theory of structuration. Cambridge, Mass.: Polity Press.

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Greenwood, R., and C.R. Hinings. 1996. Understanding radical organizational change: Bringing together the old and the new institutionalism. Academy of Management Review 21:1022-54. Johnson, B., and B. Hagström. 2002. Policyspridning som översättning: En fallstudie av svensk metadon-behandling mot heroinnarkomani. Nordiske Organisasionsstudier (4)1:26-59. Sevón; G. 1996. Organizational imitation in identity transformation. In Translating organizational change, edited by B. Czarniawska and G. Sevón. Berlin and New York: Walter de Gruyter. Hofmann, P.A. 1993. Critcal path method: An important tool for coodinating clinical care. Journal of Quality Improvement 19(7). Latour, B. 2005. Reassembling the social: An introduction to Actor-NetworkTheory. Oxford: Oxford University Press. –––. 1987. Science in action. Cambridge, Mass.: Harvard University Press. –––. 1986. The powers of association. In Power, action, and belief: A new sociology of knowledge?, edited by J. Law. London: Routledge and Kegan Paul. Law, J. 1992. Notes on the theory of the actor-network: Ordering, strategy and heterogeneity. Centre for Science Studies, Lancaster University, Lancaster, U.K. http://www.comp.lancs.ac.uk/sociology/papers/Law-Notes-on -ANT.pdf. Lindberg, K. 2002. Kopplandets kraft: Om organisering mellan organisationer. Gothenburg, Sweden: Bokförlaget BAS. Lounsbury, M. 2003. The problem of order revisited: Towards a more critical institutional perspective. In Debating organization: Point-counterpoint in organization studies, edited by R. Westwood and S. Clegg. Oxford: Blackwell Publishing, 210-219.

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Sahlin-Andersson, K. 1996. Imitating by editing success. In Translating organizational change, edited by B. Czarniawska and G. Sevón. Berlin and New York: Walter de Gruyter. Scheuer, J.D. 2006. Translating the concept of translation: An analysis of the Scandinavian institutionalists’ translation of the concept of translation. Nordiske Organisasjonsstudier 8(4):3-40. –––. 2003. Patientforløb i praksis: En analyse af en idés oversættelse i mødet med praksis. Ph.D. diss., Copenhagen Business School. Scott, W.R., M. Ruef, P. Mendel, and C. Caronna. 2000. Institutional change and healthcare organizations. Chicago: University of Chicago Press. Schütz, A. [1953]1973. Common-sense and the scientific interpretation of human action. In Collected papers, vol.1. The Hague: Marinus Nijhoff, 3-47. Zander, K. 1995. Collaborative care: Two effective strategies for positive outcomes. Chicago: American Hospital Publishing, Inc.

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Chapter 6

Intervention, Implementation, and Translation as Metaphors of Change in Healthcare and Public Sector Organizations By John Damm Scheuer

Introduction In Denmark, as well as in other countries, new innovative ideas are continuously introduced in order to change healthcare organizations. New ideas, especially those related to New Public Management (NPM), have changed Danish healthcare organizations in recent years (Jespersen et al. 2002; Vrangbæk 1999). These ideas and changes include the decentralization of budget and management competencies, activity-based budgets, internal contracting, management by objectives, and the introduction of systematic quality development (Jespersen et al. 2002). Healthcare professionals such as doctors, nurses, managers, and consultants often ask themselves what it takes to introduce these sorts of ideas and make them work (i.e., produce the desired outcomes). To answer these questions, healthcare and other professionals often turn their attention toward science. They typically ask for research and evidence-based knowledge about how an idea may be implemented. This chapter examines in detail the answers that three scientific communities can provide. A study of the research literature show that the introduction of innovative ideas and change in healthcare and public organizations has been studied in at least three different ways by at least three different types of researchers:


• Doctors have studied organizational change as implementation of evidencebased knowledge in practice • Policy analysts and researchers related to public administration have studied organizational change as the implementation of policy ideas in practice • Scandinavian institutionalists have studied organizational change as ideas that travel in and across organizational fields during which process they are translated in local practice. The following research questions are addressed: A. What are the theoretical perspectives and metaphors about organizations and organizational change used by these three communities of researchers? B. What types of problems have they tried to solve, and which types of problems have they encountered in relation to theorizing about and analyzing organizational change?

Research Communities in Focus A community may be defined as “a body of persons of common and especially professional interests scattered through a larger society” (Encyclopaedia Britannica online). The epistemic community – a group of inquirers who have knowledge problems to solve – is the basis for claim-making in research (Miller and Fox 2001). In the analysis that follows, it will be suggested that researchers typically belong and contribute to specific communities sharing the same types of theoretical, empirical, and/or methodological interests. The analysis assumes that research development by specific communities can be studied through their publications. The first community of researchers is related to the Cochrane Collaboration, which makes and distributes systematic and evidence-based reviews of treatments and their effects. The focus is on the Effective Practice and Organization of Care Group (EPOC ). EPOC researchers systematically review the research in order to decide which interventions are most effective when trying to implement evidence-based knowledge about treatments in clinical practice. The second community of researchers consider and study the implementation of policy decisions in public organizations. These researchers have traditionally studied implementation processes from a top-down or a bottom-up perspective, or have synthesized these approaches when studying change in public 140

Intervention, Implementation, and Translation as …

organizations. The third community of researchers approach the question of implementation from another perspective. Substituting the concept of “implementation” with “translation,” they focus on studying how innovative ideas travel across time and space in organizational fields and on how they enter and become institutionalized in organizations. Of course, human and organizational change has been theorized and studied in other ways by these different communities of researchers.1 The reason for focusing on these three communities of researchers is that practitioners such as doctors, nurses, administrators, and consultants in healthcare organizations often refer to the concept of implementation when speaking and writing about organizational change. Another reason is that these groups have likely been confronted with the concept of implementation while they were studying, or during their professional lives. The concept of translation, and theories about the travel of ideas, are offered to healthcare and other professionals as alternative ways to conceive of organizational change.

Analytical Strategy Assumptions About the Social Sciences As a consequence of social constructivism and the linguistic turn in organizational analysis, it may be suggested that scientific knowledge is socially constructed (Turner 2006). What counts as factual, true, or false knowledge is a result of situated, social, and knowledge constructing processes where researchers with different interests negotiate until they reach such results (Olesen 1996). Even though an “objective reality” might exist it is not possible to test since such a test would depend on an intersubjective pragmatic and/or aesthetic test based on language: Whether we claim to speak of a reality or a fantasy, the value of our utterance cannot be established by comparing it to its objects, but only by comparing it to other utterances. … As the new pragmatists put it, the correspondence theory of truth is untenable because the only thing with which we can compare

1

See Borum 1995, Borum and Christiansen 2006, and Poole and Van de Ven 2004.

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statements are other statements. In this light, there are at least two possible criteria of what constitutes ‘good knowledge’: the pragmatic and the aesthetic (Czarniawska 1997, 56). Barbara Czarniawska (1997) concludes that there are no universal criteria for what constitutes good scientific knowledge. What exists are, rather, contemporary and local agreements in scientific communities about what constitutes good, functional, and aesthetic knowledge. Ontologically, the following analysis takes its point of departure from this view. It suggests that organizational studies are characterized by many different theories about organizations, and that these different theories may be organized in groups that often share the same metaphorical understanding of the organization and the nature of organizational change.2 Theories arrange sets of concepts to define and explain a phenomenon (Silverman 2000). They consist of plausible relationships produced among concepts and sets of concepts (Strauss and Corbin 1994, 278). They provide a framework for critically understanding phenomena in the world, as well as a basis for considering how the unknown might be organized (Silverman 2000). A metaphor may be defined as “a figure of speech in which a word or phrase literally denoting one kind of object or idea is used in place of another to suggest a likeness or analogy between them” (Encyclopaedia Britannica online). By asserting that subject A is like B, the metaphorical processes of comparison, substitution, and interaction between the images of A and B generate new meaning. Metaphors about organizations are by no means innocent (Morgan 1981, 1986). They lead to distinctive and often partial ways of understanding organizations that can become taken-for-granted. They can also help us to create new ways of thinking about organizations. They are often used as practical tools for diagnosing organizational problems, and for organizational management and design. 2

ccording to Turner (2006), the unintended consequence of Kuhnianism, and the concept of the paraA digm in the social sciences, was that it legitimized every perspective. This resulted in a permanent revolutionary situation, in which different potential social science paradigms continuously competed with one another free from the threat of being delegitimized by standard methods and standard definitions. McKelvey (1997, 1999) suggests that organizational studies is in a prescientific, preparadigmatic state. Robert Westwood and Stewart Clegg (2003) suggest that there are no paradigms in organizational studies, at least not the kind imagined by Thomas Kuhn (1962, 1970, 1971). As a consequence, I refer to theories and groups of theories with metaphorical characteristics in common, instead of referring to paradigms.

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Steps in the Analysis In order to organize, analyze, and compare the different theoretical perspectives, metaphors, and central problems considered by the three research communities, six basic questions are asked:

1. What is the focus of their perspective? 2. How are the organizational relationships described? 3. How are processes described? 4. What kind of knowledge or process is proposed as necessary in order to make organizational change occur? 5. What is perceived as problematic? 6. Which problems have been encountered in research, and which of them are the focus of future research? The first question is based on the assumption that research communities often concentrate on doing research in particular areas in order to solve or understand particular types of empirical and theoretical problems. When they study and theorize organizational change, they do so in a certain context, which is an important factor in the understanding of organizational change that is developed. The second and third questions suggest that different research communities develop basic metaphors and ways of interpreting and depicting the organization and organizational processes that are related to the types of empirical and theoretical problems on which they focus. In these processes, a kind of tunnel vision or group-think often develops, which makes it difficult for researchers and practitioners alike to think differently about processes of organizational change, even when confronted with new types of interpretation. This leads to the fourth question. What is perceived as problematic in relation to the change process depends on the characteristics of the theoretical perspectives and metaphors a research community applies in order to understand such processes. The basic assumptions about the organization and organizational change that are built into particular perspectives and metaphors make it possible to distinguish between central and peripheral problems. In each community, professional publications are supposed to promote a dialogue aimed at developing the scientific field in which the researchers are working. Certain problems related to change are identified by the community and some of them are considered especially important in order to develop the communities’ understanding of organizational change in 143


its particular scientific field (see the fifth question). Members with extensive research knowledge typically point out problems for future research, thereby making it possible to direct the community’s attention and efforts in similar and new directions (see the sixth question). The consideration of these six questions is followed by a comparative analysis of the approaches to organizational change by the three communities. The central problems that the communities are trying to solve are identified, as are problems encountered in relation to theorizing and analyzing organizational change.

Analysis of the Three Approaches The research groups have three different approaches, based on three different metaphors for organizational change: intervention, implementation, and translation. The characteristics of the three metaphors identified in the analysis are summarized in table 6.1. Metaphor

Intervention

Implementation

Translation

Focus

Interventions aimed at introducing evidence based practice

Implementation of legitimate policy decisions

Translation of ideas that travels

Organization

Cochrane Collaboration

Decision center

Organization with – decision center(s) – local knowledge users

Middle layer Street-level bureaucrats

Loosely coupled communities Means of intra- and inter-or-ends ganizational translators Means-ends locally constructed

Process

Center-periphery

Top-down and/or bottom-up

Change by

Evidence-based knowledge about crucial variables and effective interventions

Knowledge about crucial Situated learning about variables and/or processes the possibilities and effects of associating human and nonhuman elements

Problem

If evidence-based knowledge about treatments is not used in practice

Policy outcomes not in ac- Negative rather than cordance with policy goals positive effects of the process of translation

Table 6.1. Three Metaphors of Organizational Change 144

From association of few to association of many actors (actants)


Cochrane: An Evidence-Based Approach to Change The Cochrane Collaboration is an independent international nonprofit organization, which makes and distributes systematic and evidence-based reviews of healthcare interventions, and promotes the search for evidence in the form of clinical trials and other studies of interventions.3 The organization, named after the British epidemiologist Archie Cochrane, was founded in 1993. Cochrane reviews are a highly regarded source of evidence about the effects of healthcare interventions among doctors and other healthcare professionals, partly because the reviews are regularly updated as more information becomes available and in response to comments and criticisms. Reviews are made by healthcare professionals who volunteer to work in one of the many Cochrane review groups. The reviews are made available to other healthcare professionals through the Cochrane Database of Systematic Reviews which is published quarterly as part of the Cochrane Library, an updated collection of evidence-based medicine databases. The following analysis focuses on one of the Cochrane review groups, the EPOC, which specializes in making systematic reviews of research in order to decide which interventions are most effective when trying to implement evidence-based knowledge about treatments in clinical practice. The scope of the EPOC group is described on their homepage: The focus of EPOC is on reviews of interventions designed to improve professional practice and the delivery of effective health services. This includes various forms of continuing education, quality assurance, informatics, financial, organisational, and regulatory interventions that can affect the ability of healthcare professionals to deliver services more effectively and efficiently. The following section examines the state-of-the-art work of EPOC researchers, in order to show how the medical community has attempted to handle the intricacies of organizational and behavioral change, and to point out the problems that have arisen on the basis of that work.

3

T he description is based on information available from the homepage of the Cochrane Collaboration, http://www.cochrane.org/index.htm. Another relevant webpage is http://www.epoc.uottawa.ca/.

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From Best Evidence to Best Practice Grol and Grimshaw identify a central problem for the EPOC group: Continuous development of healthcare innovations presents a constant promise of more effective and safe patient care. About 10,000 new randomized trials are included in MEDLINE every year, and 350,000 trials have been identified by the Cochrane Collaboration: however, major difficulties arise in introducing these innovations into routine daily practice. One of the most consistent findings in research of health services is the gap between evidence and practice. Results of studies in the U.S. and the Netherlands suggest that about 30–40% of patients do not receive care according to present scientific evidence, and about 20–25% of care provided is not needed or is potentially harmful (Grol and Grimshaw 2003, 1225). Grimshaw, Eccles, and Walker (2002) have highlighted that there is a difference between what doctors do and the evidence-based knowledge about what they ought to do. Doctors have a limited capacity and limited time to process information, which explains why dissemination or diffusion of knowledge through peer-reviewed magazines doesn’t work. They also point out that doctors have not been trained to evaluate the quality of the research that is being published. Another difficulty is related to the shear amount of research published in each of the different subspecialties of medical science. Shaneyfelt has calculated that general internists would need to read twenty articles per day year-round to maintain their present knowledge. Even though the availability of systematic reviews and guidelines reduces the need for doctors to read original studies, they still find it difficult to keep up with such syntheses (Grol & Grimshaw 2003, 1225). There are a number of potential barriers that might make it difficult to implement evidence-based knowledge in clinical practice, including: … structural (e.g., financial disincentives), organizational (e.g., inappropriate skill mix, lack of facilities or equipment), peer group (e.g., local standards of care not in line with desired practice), individual (e.g., knowledge, attitudes, skills), information overload within busy consultations leading to acts of omission, or patient expectations (e.g., created by direct-to-consumer pharmaceutical advertising (Grimshaw et al. 2002, 238). 146


The authors are, however, confident that the best way to study interventions and changes in the behavior of doctors in clinical practice is to use clusterrandomized trials. They also explain that this kind of research is necessary in order to help medical educators and local healthcare organizations maximize benefits and minimize costs when intervening in order to implement change in clinical practice: … strategies for disseminating and implementing research findings are not without costs. … Thus, medical educators and local healthcare organizations …need guidance in considering how best to maximize benefits and minimize costs. … We strongly contend that the best evidence to guide decisions about which strategies to choose derives from rigorous evaluations (mainly clusterrandomized trials) of different strategies (Grimshaw et al. 2002, 239) The EPOC group has developed a taxonomy of different interventions aimed at changing physicians’ behavior in clinical practice. The group has reviewed the research literature in order to identify which of these interventions are most effective. Table 6.2 (next page) summarizes the conclusions of the EPOC group’s analysis of reviews.

Recent developments After its review, the EPOC group concluded that it is difficult to identify the interventions that are most likely to be effective (or cost-effective) in particular situations. It is also noteworthy that the authors conclude that the generalizability of current studies remains uncertain because of the researchers’ limited understanding of contextual, organizational, and individual factors that might influence the effectiveness of different interventions (Grimshaw et al. 2002, 242). The EPOC group has come to the conclusion that the lack of evidence of the effectiveness of the different interventions might be explained by the fact that these interventions have not been based on validated theories about human behavior and organizational change. The group believes it is possible to develop a generalizable model based on theories about human behavior that will make it possible to decide which interventions might be most effective in changing clinical practice. “The assumption that clinical practice is a form of human behavior, and can be described in terms of general theories relating to

147


Strategy

Number of reviews*

Number of studies

Conclusions

Educationel materials

9

3-37

Mixed effects

Conference, courses

4

3-17

Mixed effects

Interactive small group meetings

4

2-6

Mostly effective, but limited number of studies

Educational outreach visits

8

2-8

Especially effective for prescribing/prevention

Use of opinion leaders

3

3-6

Mixed effects

education with different educational strategies

8

5-63

Mixed effects, depending on combinations of strategies

Feedback on performance

16

3-37

Mixed effects, most effective for test ordering

Reminders

14

4-68

Mostly effective, particularly for prevention

Computerised decision support

5

11-98

Mostly effective for drug dosing and prevention

Introduction of computers in practice

2

19-30

Mostly effective

Substitution of tasks

6

2-14

Pharmacist effect on prescribing: nurse: mixed effects

Multiprofessional collaboration

5

2-22

Effective for a range of different chronic conditions

Mass media campaigns

1

22

Mostly effective

Total quality management / continuous quality improvement

1

55

Limited effects, mostly single-site non-controlled studies

Financial interventions

6

3-89

Fundholding and budgets effective, mainly on prescribing

Patientmediated interventions

8

2-14

Mixed effects: reminding by patients is effective in prevention

16

2-39

Most reviews: more effective that single interventions: not confirmed in recent reviews.

Combined interventions

* Number of reviews that included studies addressing the interventions.

Table 6.2. Overview of Strategies for Implementation of Evidence and Conclusions of Reviews Source: Grol and Grimshaw, 2003 148


human behavior, offers the basis for a generalizable model” (Eccles et al. 2005, 108). As a consequence, the EPOC group has directed its attention toward finding validated theories about human organizational behavior: Research on organizational, economic, and political approaches to change is as yet scarce; we note a challenge for researchers here. … Which strategies work for a particular type of evidence in a setting? This question implies we need to give more attention to the validation of different theories on changing professional and organizational performance (from health promotion, social sciences, organizational and management sciences, marketing, and economy) to find the crucial determinants of effective change (Grol and Grimshaw 2003, 1229). Ferlie and Shortell (2001) suggest four levels at which interventions to improve the quality of healthcare might operate: 1) individual health professional, 2) healthcare groups or teams, 3) organizations providing healthcare (e.g., NHS trusts), and 4) larger healthcare system or environment in which individual organizations are embedded. Furthermore: A full scientific rationale for interventions to translate research findings into clinical practice requires exploration of theories relevant to interventions directed at each of these four levels. Given the large number of potentially relevant theories, it is helpful to have a rationale for choosing between them (Eccles et al. 2005, 109). The PRIME (process modelling in implementation research) study, which was launched by the EPOC group in December 2003, may be seen as an attempt to move further in this direction: The objectives of the study are: to amplify and populate scientifically validated theories of behavior with evidence from the experience of health professionals; to identify which elements of the questionnaire (i.e., which theoretical constructs) predict clinical practice and distinguish between evidence compliant and noncompliant practice; and on the basis of these results, to identify variables (based on theoretical constructs) that might be prime targets for behavior change interventions (Walker et al. 2003, 1).

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The theories considered in the study include: two motivational theories (the theory of planned behavior and social cognitive theory); three action theories (i.e., the theory of operant conditioning, of implementation intentions, and Leventhal’s self-regulation theory); and, finally, a stage model of change (Walker et al. 2003). As a consequence of these activities, further research and a number of studies have been launched focusing on choosing and validating different theories about human and organizational behavior. One such study focused on using the theory of planned behavior to investigate factors associated with the prescriptions of antibiotics for patients with uncomplicated sore throats by general practitioners. Another study asked “Can psychological models bridge the gap between clinical guidelines and clinicians’ behavior?” (Eccles et al. 2005). Yet another study tried to establish consensus among experts on which psychological theories and variables might be of importance in relation to the implementation of evidence-based practice (Michie et al. 2004). A recent study (Foy et al. 2005) focused on identifying barriers and facilitating factors related to implementing clinical guidelines for care of women requesting induced abortions by using a questionnaire based upon theoretical constructs from the theory of planned behavior.

Analysis The first community of researchers belong to the medical community and have a background in the natural sciences. Their perspective is labelled “intervention,” since their primary goal is to understand how they may intervene in order to assure that evidence-based knowledge about treatments is used in clinical practice. Researchers related the metaphor of intervention focus on limits and possibilities for intervening in order to better assure an evidence-based practice in healthcare. The image of the organization and the organizational relationships consists of three elements: 1. An authority center (e.g., the Cochrane Collaboration) outside the healthcare organization which provides evidence-based knowledge about treatments and interventions (Røvik 1998). 2. A decision center somewhere in the organization, which decides to adopt and implement that knowledge. 3. And the knowledge-users at the bottom of the organizational hierarchy, whose behavior is supposed to change in accordance with the evidencebased knowledge that has been put forward. 150


Ideas move from a center – the Cochrane Collaboration – to the periphery (other organizations). Goals, as well as decisions related to the means necessary for achieving them, are taken outside the organization on the basis of expert knowledge. Effective change is dependent on evidence-based knowledge about variables and effective intervention, especially related to changing individual human behavior. Problems arise when evidence-based knowledge is not used in clinical practice. The search for evidence-based knowledge about effective treatment interventions in clinical practice has not been entirely successful. The researchers related to the EPOC group are disappointed that the current evidence base is difficult to use in healthcare settings. They cannot identify which intervention is most likely to be effective (or cost-effective) in a particular situation. Even though some evidence exists, they conclude that the generalizability of current studies remains uncertain because of their limited understanding of contextual, organizational, and individual factors that might influence the effectiveness of different interventions. Even though the researchers point to a broad range of factors, including material ones that may prevent the introduction of evidence-based knowledge in practice, they have concluded that the problem lies with the fact that the examined interventions were not based on a validated theory of human and organizational change. The new focus is on establishing principles for choosing and testing such theories in order to identify variables and types of interventions that are based on validated theories about human and organizational change. The theories chosen focus on individual human behavior and on how it might be changed. These include theories about planned behavior and social cognitive theory, the theory of operant conditioning and of implementation intentions, Leventhal’s self-regulation theory, and stage models of change. Other researchers have tried to establish a consensus among psychologists about which psychological factors are most important for behavioral change, in order to initiate research to validate these theories.

Implementation: Top-Down, Bottom-Up, and Combined Perspectives on Change Implementation as Part of the Policy Process Researchers in public administration and public policy have studied the introduction of innovative ideas and change as implementation processes. Implementation has traditionally been understood as a part of the political process, especially the practical process of carrying out policies. According to Heclo, 151


policy is “a course of action intended to accomplish some end” (1972, 84). Politics deals with the allocation of resources and values in society. This is summarized nicely by Harold Lasswell’s book title, Politics: Who Gets What, When, How (1958). Parson’s (1995) way of describing the policy process is typical for political scientists. He describes a number of phases in which implementation has its natural place. The policy process follows a path consisting of: 1) identifying and defining the problem, 2) presenting and evaluating alternatives, 3) choosing a policy, 4) implementation, and 5) evaluation. If the goals are not met, the policy process might start all over again. The policy science tradition may be said to integrate questions of implementation in its very definition of the science: “The policy sciences may be conceived as knowledge of the policy process and of the relevance of knowledge in the process” (Lasswell 1970, 3).

Roots of Implementation Studies Historically, the interest in implementation studies grew out of a frustration over the ineffectiveness of policy programs related to Kennedy and Johnson’s War on Poverty, which was a part of their Great Society initiative. The lack of expected effects led to an interest in the analysis of implementation processes during the 1960s and 1970s.4 Pressman and Wildavsky, in their pivotal study of how a federal jobs creation program in Oakland, California turned into an architecture and bridge building enterprise, demonstrated that there was “a missing link” (Hargrove 1975, 1983) between policy decisions and policy outcomes. The implementation process was described as more complex than formerly anticipated. Complicating factors, such as civil servants playing an important role in the implementation of policy decisions and the high number of decisions points in the process, made it difficult to plan and control for results. Nine different organizations had to be coordinated in order to implement the decision, and the analysis of the problem and causal theories related to solutions were insufficient. Pressmann and Wildavsky’s study turned out to be a wake-up-call for political scientists. The discovery of the complexity of real-life implementation processes led to the development of a top-down perspective on policy implementation.

4

See Pressman and Wildavsky 1973.

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Top-Down Implementation The literature related to this perspective is called top-down because it takes as its point of departure the political decisions that are supposed to be implemented. Because of democratic principles, it was perceived as illegitimate if policy decisions taken in Washington were not implemented as intended locally. The political scientists wanted to give politicians and public administrators good advice about how to implement their policies. As a consequence, a number of studies were launched that focused on identifying the crucial variables which ought to be taken into account when implementing policy decisions. Some of the classic studies of this type were made by Donald Van Meter and Carl Van Horn (1975), and Paul Sabatier and Daniel Mazmanian (1980). Sabatier and Mazmanian pointed out seventeen variables related to three problem areas in their theoretical framework: the identification of the policy problem, the ability to structure the implementation process, and other variables not related to the legal aspects of the policy implementation process. Different authors also looked more closely at different aspects of the implementation process. Berman (1978) pointed out the importance of the institutional setting and how the implementation of policies might be divided into macro- and micro-implementation; the formulation of a policy decision into a program; the start-up of a local project related to the policy decision; and the introduction of new practices locally. O’Toole and Montjoy (1984) pointed out the difficulties related to coordinating multiple organizations when implementing policy decisions, while Ingram and Schneider (1990, 1991) emphasized the importance of the social construction of target groups made by policymakers. Though many case studies were attempted, it turned out to be difficult to compare and reach generalizable conclusions about the crucial variables. Researchers started talking about how implementation research had a problem with too few cases and too many variables. Some researchers started, therefore, looking in a different direction.

Bottom-Up Implementation Instead of looking at the policy process as a top-down process, and trying to identify the crucial variables related to successful implementation, some researchers started focusing on the policies that were the result of the way civil servants acted locally. Wildawsky and Majone suggested that, related to 153


the top-down tradition, implementation as interaction was an alternative to implementation as control. They described implementation as an evolutionary process and suggested that unintended consequences of implementation stemmed from mutual adaptation, whereby “a policy or program evolves in response to its environment as each alters the other” (Majone and Wildavsky 1977). Browne and Wildavsky (1983) noticed that instead of looking at implementation processes as a dynamic process, implementation researchers tended to look at it as a static and predictable process. Elmore (1980) rejected “the noble lie,” by which he meant the idea that hierarchy works, and that civil servants at lower levels of public organizations do what they are told to do by the decision center. Instead of this kind of forward mapping when planning in public organizations, he suggested another strategy – backward mapping. A key point was to try to understand how the organization and its employees actually worked, both formally and informally. Instead of trying to control the organization top-down, the decision-maker should try to identify which part of the organization would have the capacity to handle a given task. The questions decision-makers should ask themselves became: “What is the ability of this unit to affect the behavior that is the target of the policy?” and “What resources does this unit require in order to have that effect?” Another researcher, Michael Lipsky (1980), focused on how “street-level bureaucrats” influenced the implementation of policies. He suggested that “when taken together, the individual decisions of these workers become, or add up to, agency policy.” He studied civil servants working locally with different groups of people, and identified the resulting policies. David Porter and Benny Hjern (1981, 1987) developed yet another approach. They thought that policies were created constantly and in many places in modern societies; even in areas where decision centers did not formulate formal policies. Their idea was to perform an institutional policy analysis aimed at revealing the interaction pattern or informal implementation structure between different groups and actors, in order to identify which policies were the result of these interaction patterns and/or of changes in interaction patterns. The bottom-up approach emphasizes the importance of the actions of individual actors, as well as interaction patterns between actors. The approach may, however, be criticized for ignoring the problems related to governing the actions of actors in directions deemed necessary by a democratically elected policy center.

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Combined Perspectives At present there is no agreement or consensus about how to define the concept of implementation. A number of combined perspectives have developed that integrate theoretical elements from the top-down and the bottom-up perspectives. The elements that have been combined are those shown most likely to influence the implementation process, according to implementation research (Bjørkemarken 1995). The combined perspective help to understand what happens when policy ideas are implemented and give some advice about how to plan and control the implementation of such ideas. The different approaches do, however, agree on one thing: Policies are influenced by many different factors and from many different directions when they are created and implemented. They may be influenced by different political and administrative levels, by street-level bureaucrats, as well as by interests groups who respond differently than expected in relation to certain policy decisions. Hull and Hjern (1983) have developed an “inductive approach in order to match policy outcomes with policy intentions.” They suggest interviewing all actors involved in policymaking from the top to the bottom of the administrative hierarchy in order to reveal the implementation activities occurring, the implementation structure, the actors’ understanding of the legal intensions and of how laws do or do not contribute to dealing with a certain policy problem. Another thing that might be focused on is how and why things go wrong during the implementation process. Paul Sabatier (1997) contributed the advocacy coalition framework. Søren Winter (1994) contributed another model whereby the outcome of an implementation process depends on how a given policy is formulated and designed and on different elements that may affect the process, such as organizational as well as interorganizational behavior, and the behavior of street-level bureaucrats and of target groups.

Recent Developments According to Susan Barrett (2004), the development of a New Right movement during the late 1980s and the introduction of New Public Management (NPM) meant that concerns about the process of implementation were superseded by an emphasis on change management and a focus on performance targets. Since NPM addressed key problems of implementation failure (e.g., lack of clear policy objectives, resource availability, and control over implementing 155


agencies) implementation studies were perceived as less relevant. She went on to argue that many unintended consequences of NPM reforms and the topdown model of policy implementation have, however, made implementation research relevant once again. Recently, implementation researchers have started discussing the need for a revival of implementation research and new directions that the research might take (Schofield 2001; Barrett 2004; Saetren 2005). Schofield (2001) has suggested that implementation researchers need to address some of the contemporary problems facing the (New Public) management of public services. Brodkin (1990) posits that the relationship between policy promises and policy products might be explored by focusing on four themes within the literature: 1) knowledge, learning, and capacity in implementation, 2) the processes of implementation, 3) the role of actors and agents in implementation and, 4) bureaucratic discretion in implementation. Implementation studies should also reflect and take into account that new and emerging political ideas, such as those related to NPM, change the organizational and societal context in which implementation and change take place. In a recent article, Laurence J. O’Toole (2004) offered an analysis of the cutting edge of implementation research. He points out that implementation research has moved past the top-down/bottomup dispute and towards perspectives that synthesize elements of these two approaches. The context-dependent feature of earlier work has been exposed. The volume of case studies in implementation research has been supplemented by a number of larger-n empirical studies. Elements of both top-down and bottomup approaches have been validated, but the research literature is still overpopulated by a mass of potential explanatory variables that need to be tested and sorted in order to decide which variables are especially important in relation to transforming policy promises into policy products (Barrett 2004). A fully validated theory of implementation is still needed and plenty of work remains (O’Toole 2004). O’Toole points to research in institutional analysis, the study of governance, networks and network management, and certain formal and deductive approaches that might inform and develop implementation research further. He also considers Elmore’s theories about backward mapping (1980), reversible logic (1985), game theory, and contextual interaction theory as applicable when translating the results of implementation research into advice that might be useful for people working in practice. Two different quantitative research strategies have been proposed in relation to larger-n empirical studies: One focuses on constructing a general theory of implementation (Goggin 1986, 1998; Goggin et al. 1990), and the other on developing and testing dif156


ferent partial theories and hypotheses (Winter 1999). According to O’Toole (2000), the methodological and theoretical recommendations of Goggin et al. would require applying research designs that involve numerous variables across fifty states, over at least ten years, as well as measuring the relevant variables by a combination of content analyses, expert panels, elite surveys, and expert reassessment of the data from questionnaires and interviews. Winter (2006) has, therefore, criticized Goggin et al. for suggesting a too demanding research strategy. Instead, he suggests a research strategy that may be summarized in six points: 1) provide theoretical diversity, 2) focus on partial rather than general implementation theories, 3) seek conceptual clarification, and 4) focus on the implementation output (performance of implementers) as a dependent variable, 5) include studies of outcomes, and 6) use more comparative and statistical research designs (Winter 1999, 2006).

Analysis The second community of researchers are social scientists related to public administration and policy analysis. Their perspective is referred to as “implementation” because of their focus on policy implementation. They focus on the possibilities and limitations related to implementing legitimate policy decisions in practice. The relationships are constructed in a hierarchical manner. At the top of the hierarchy there is a (democratically elected) decision center, which sets-up legitimate policy goals. In the middle, there are regional or local organizations, or middle managers. Street-level bureaucrats who are in charge of delivering services to the general public are at the bottom of the hierarchy. Overall policy goals are subdivided into means-ends chains on their way through the hierarchy. Ideas move, and types of processes are identified as, top-down, bottom-up, or a combination of the two. Effective change is dependent on predictive knowledge about which variables – topdown as well as bottom-up – are most likely to affect policy implementation. It is perceived as a problem when policy outcomes are not in accordance with policy goals. The researchers working in the field of public administration and public policy have encountered different types of problems during its development. First, they discovered that there is a difference between policy decisions, or policy promises, and policy outcomes. This led to a search for the crucial variables that are particularly important for implementing policy decisions in 157


practice. As a consequence of this search, however, the researchers encountered other types of problems. Many case studies were carried out and many variables posited as important when implementing policy decisions, thereby making advice to policy and decision-makers difficult. There were, however, not enough case studies to reach generalizable conclusions about which variables were crucial for implementing policy decisions in practice. Some researchers chose to solve the problem by abandoning the idea that policy outcomes might be controlled by relying on planned top-down change and an insight into general variables affecting the implementation process. Instead, they suggested that policy processes should be regarded as more contingent processes which constitute policies regardless of actions taken at the decision center. The bottom-up approach focused on the importance of actions of individual actors, as well as interaction patterns or networks between actors. Evolutionary and learning processes were identified that lead to the creation of policies in practice, or realized policies. The approach was criticized for ignoring the problems related to governing the actions of actors in directions deemed necessary and valuable by democratically elected policy centers. Implementation researchers turned, therefore, their focus toward designing implementation models combining both top-down and bottom-up elements that proved promising in earlier research. When discussing the state of the art of implementation studies, researchers conclude that there exists no agreement or consensus about how to define the concept of implementation. The research has moved in the direction of models of implementation combining top-down and bottom-up elements. Some researchers have suggested a revival of implementation research focusing on general themes present in the implementation literature (i.e., knowledge, learning, the process of implementation, the role of actors and agents and bureaucratic discretion in implementation). Other researchers focus on the now classic implementation problem as something that still needs to be solved. Larger-n empirical studies are especially needed that can help sort out which of the many variables identified in implementation studies are especially important to the policy implementation process. Researchers belonging to the EPOC group have started looking for theories about individual change in order to find a theoretical basis on which to build a validated theory of implementation. The implementation researchers are, however, focusing on the intergroup level rather than on the individual level of change in their search for relevant theories. The theories which are considered relevant are theories of governance, networks and network management, Elmore’s theory 158


about backward mapping, theories about reversible logics, game theory, and contextual interaction theories. Finally, implementation researchers note that the very contexts on which former theories about implementation were based has changed as NPM reforms have changed the institutional contexts in which implementation processes occur. Consequently, this aspect must also be taken into consideration when formulating theories about policy implementation.

Change as Translation The group of researchers in focus in this section have approached the question of implementation from yet another perspective. Substituting the concept of implementation with that of translation they have focused on studying how innovative ideas travel across time and space in organizational fields, and on understanding how such ideas travel into and become institutionalized in organizations in such fields. The concept of translation discussed here originates from the philosopher Michel Serres (Brown 2002) and actor-network theory. Actor-network theory was developed in the beginning of the 1980s as an alternative to the social constructivist perspective on the construction of scientific knowledge and technology (Barnes and Bloor 1982; Callon 1986; Latour 1986; Law 1987). Since then, actor-network theory has spread out and been used in many different areas of the social sciences including social medicine (Berg 2001), art studies (Hennion 1989), political science (Barry 2001), rural studies ((Woods 1997), urban planning (Bowler 1999) and organizational studies (Hassard et al. 1999; Czarniawska and Hernes 2005). In organizational studies, the Scandinavian institutionalists criticized Selznick’s old institutionalism and Dimaggio and Powell’s new institutionalism for focusing on stability rather than change. What they wanted instead was a theory about institutional change that theorized organizations as characterized by stability as well as change (Czarniawska and Sévon 1996, 3–5). The Scandinavian institutionalists were inspired by actor-network theory, especially its concept of translation, which emphasized movement and transformation, embracing both linguistic and material objects. This inspiration led Czarniawska and Joerges to integrate the concept in what they labelled the “idea model” – a new theory about institutional change (1996). The idea model explains how ideas travel in and across organizational fields, accounting for institutional stability, as well as change, and offering a solution to a problem that had been identified by other scandinavian institutionalists: New institutionalists don’t explain the 159


role of actors and actions in the creation, diffusion, and stabilization of organizational practices (Christensen et al. 1997, 392; Meyer 1996, 242). The work undertaken by Scandinavian institutionalists to develop an alternative theory of organizational change based on the concept of translation will be analyzed in detail in the following sections. As the analysis will show, this work has until recently been much less coordinated than in the other two communities of researchers.

Translation in Actor-Network Theory Actor-network theory is based on a constructionist ontology (Callon 1986; Latour 1986, 2005; Law 1987). It claims that phenomena in the world are coproduced by humans and nonhumans (objects/things). Power, institutions, and knowledge, as well as other phenomena, are all effects of the work of heterogeneous actor-networks. The concept of translation is associated with a network building activity where actors transform tokens (orders, ideas, artefacts, etc.) into something else by translating or associating them with heterogeneous elements that might be human as well as nonhuman. The diffusion in time and space of tokens is assumed to be brought about by people, each of whom may act or translate it in different ways: they may let it drop, modify it, deflect it, betray it, add to it, or appropriate it. Whether ideas or orders become powerful depends on the number of humans and nonhumans that become (or do not become) associated with and start acting on behalf of them during the translation process. In other words, it depends on whether or not an actor-network is established in relation to a token. As a consequence, social phenomena such as institutions and/or power are an effect of the work of actor-networks rather than a cause in actor-network theory. What has to be explained is the process of translation and how the establishment and work of an actor-network make such effects (e.g., institutions, power, knowledge, etc.) possible. It is important to notice that the word “actor” in the word actor-network is given a semiotic definition. Actors are defined as actants, humans and/or objects/things that are identified as being the source of an action. As an idea – defined as a token and an actant – is translated, it is changed along with the translators. Their identities are changed. Let us now explore how these ideas have been translated and used in new institutional theory in order to study the travel of ideas.

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Models of Translation in New Institutional Theory In a recent review, Scheuer (2006) identified nine different translation models, seven of which have been developed by the Scandinavian institutionalists. In the following sections the different translation models will be scrutinized in order to show how the concept of translation has been translated and developed chronologically by these institutionalists. The different models of translation are ordered and described in a chronological fashion.

Translation as Ideas that Travel The idea model (Czarniawska and Joerges 1996) attempts to explain how ideas travel in and out of, and become institutionalized in, organizations in organizational fields. It uses Bruno Latour’s translation model as its point of departure. Instead of remaining loyal to the constructionist perspective of actor-network theory the authors integrate Latour’s conceptualization of the concept of translation into their own social constructivist idea model (Scheuer 2006). The idea model constructs the translation process as one whereby an idea is translated into an object (for instance a prototype, or some kind of document describing how the idea should be translated locally), then into an action and, finally, into an institution, if the action is repeated. Ideas are supposed to be able to travel when they have become objectified (i.e., turned into objects that have been decontextualized or disembedded) (Giddens 1984). Decontextualized and disembedded objects (e.g., descriptions and recipes describing general concepts and ideas) may travel in time and space until they are translated by someone such as a local human actor or translator, whereby the objects become recontextualised or reembedded (Giddens 1984). Fashions and processes of attention are seen as especially important in relation to the translation process. What is given attention will depend on what the actors know in advance, on cultural assumptions, on political structures, and on what leaders, the market, and the general public find important at a given time and place. The degree to which an idea has an effect depends on whether or not it is institutionalized. While the role of objects is an empirical consideration, and potentially unlimited in the actor-network model of translation, they play a more limited role in the idea model: primarily mediating the process whereby ideas travel and/or become institutionalized.

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Translation as Editing and Imitation Kerstin Sahlin-Andersson and Guje Sévon suggest that change processes are translation processes as described by Czarniawska & Joerges. They claim, furthermore, that certain socially constructed rules exist, which influence these processes. Sahlin-Andersson (1996) has argued that even though translation processes may look creative and open-ended at first glance, they turn out to be characterized by social control, conformism, and traditionalism when scrutinized more closely. Researchers, professionals, managers, consultants, and planners follow “editing rules” when they tell stories about new and innovative ideas regarding, for example, context, formulation, and logic. The result of the editing rules is that ideas that are embedded in a rational and dramatic story, and that ignore factors related to local characteristics, will travel further than ideas that are portrayed in stories without these characteristics. Guje Sévon (1996) posits that translators in organizations follow a logic of appropriateness when they translate new and innovative ideas. She claims it is especially important for the translation of an idea that it is perceived as socially appropriate and in accordance with the organizational identity. When an organization tries to imitate and learn from other organizations by adopting their ideas or models, an identity transformation is set in motion. The organization/ its members will start asking questions such as: What am I like (concerning the identification of oneself and others)? What would I like to be (a question about desire and the construction of desire)? What kind of situation is this like (an example of analogical reasoning)? What is appropriate for me in this situation (a question of institutionalized action)? The answers to these questions concern identification of oneself and others and how it is possible to become as one would desire. They become, therefore, of major importance for the translation of a particular idea or model.

Translation as Diffusion of Recipes Røvik (1998) developed a theory to explain how and why ideas travel into organizations from the organizational field. Røvik did not use Latour’s model of translation but developed his own. He suggests that ideas are translated in organizations because of rational calculations, nonintended translations, and an organization’s efforts to define and redefine its identity. Translations are tak162


ing place in the organization as well as in the organizational field. The translators may be authoritative centers in the field, managers, as well as internal and external consultants. Even though an idea may be translated in many ways, Røvik suggests that translations of an idea may be categorized analytically in relation to how the translation of the idea differs from the original. According to these categories, an idea may be concretized, partly imitated, combined, or remelted. The elements affecting the content, direction, and effect of the translation are the ones mentioned above, along with characteristics related to the idea. Concerning the latter, Røvik suggests that ideas that travel far and fast are characterized by having been:

1. authorized socially (recognized by important organization in the field); 2. theorized (presented as related to certain causes-and-effects); 3. turned into a user-friendly product; 4. presented as a new and better solution; 5. harmonized by not offending or favoring special interest groups; 6. told in a dramatic way; 7. individualized as an opportunity for development for organizational members.

Translation as Organizing of Action-Nets The concept of translation has been integrated in Barbara Czarniawska’s theory of action-nets. Action-nets are defined as collective actions that are coupled to each other because they are perceived as mutually necessary in a certain institutional setting (Czarniawska 2000a, 2000b, 2005). In actor-network theory, entities such as organizations are perceived as effects of work done by an actor-network. In the theory of action-nets, it is suggested that entities and phenomena (e.g., actors, social order, formal organizations, and informal networks etc.) are created by actions that are related to each other in action-nets. Actions-nets are perceived as a precondition for the establishment of actornetworks as described in actor-network theory (Czarniawska 2005, 31–32). Czarniawska’s theorization is inspired by Berger and Luckmann (1966). Organizations, actors, and networks begin as actions, which are then repeated; for instance, when certain actions produce a desirable result, have a function, or are perceived as aesthetically appealing by someone, or simply occur accidentally. The new action pattern is followed by a normative explanation of the 163


pattern that is in accordance with present norms and values. Action-nets are produced and reproduced in dialogues that occur in many different places in time and space. Czarniawska (2005) identifies three types of actions that contribute to the production of order: translation, editing, and inscriptions. In organizations, translations occur between different types of languages: from and to words, numbers and pictures; from abstract to concrete aspects; and from and to different local types of languages. During the process of translation, the translators are editing their translations in a way that balances different interests and viewpoints. When that is done, the outcome of the process may be inscribed in a document or another type of object, which is then written in only one language, thereby facilitating organization, the achievement of social order, and allowing organizational members to talk about it.

Translation as Communication Johnson and Hagström (2002) relate Latour’s translation model to the semiotic and ritual communication model, which focus on actors’ construction of meaning in local socio-cultural contexts. The translation process is, consequently, portrayed as a fight and power struggle over alternative descriptions of problems and solutions in the organizational field. It is supposed that the translation process is affected by the latent and manifest conflicts between different actors involved in the translation process. It is also supposed that the effects of introducing an idea depend on the ability of the different actors to mobilize support for their interpretations of the problem and potential solutions. An idea becomes more powerful as it gains supporters.

Translation as Association Scheuer (2003) focuses on how innovative ideas are translated through association with heterogenous elements (i.e., humans as well as nonhumans) as the idea encounters local practices in an organization. Translation is defined as one of many alternative ways through which human actors can associate an element, such as an idea, with other human and nonhuman elements. As more humans and nonhumans are enrolled by an idea in a local time-space context and act on its behalf, the more durable and powerful it becomes. Translation processes have to be analyzed by deciding upon when the translation process starts and ends, and by dividing the selected time-period into episodes. The 164


humans and nonhumans associated with the idea during each episode, as well as across episodes, are analyzed. On the basis of the analysis, it becomes apparent who the translators were, which kinds of translations were made, and their effects. Elements and conditions affecting the content and direction of the translation process are considered as empirical questions, which have to be answered on the basis of empirical analysis. Existing theories might, however, be used heuristically to set up hypothesis about the elements and conditions that might influence the translation process. The effect of the translation of an idea is assumed to be the result of work done by the established collective of humans and nonhumans. Institutionalization is associated with a relatively stable association of heterogeneous elements to an idea in time and space. Deinstitutionalization is associated with a dissolution of such a stable association of heterogeneous elements in time and space.

Recent Developments John Campbell has criticized institutionalists for not specifying the causal concepts related to institutional change (2004). In an attempt to rectify that error he suggests that two concepts may be especially important when theorizing evolutionary and revolutionary institutional change. One concept is bricolage, and the other is the concept of translation. The analysis of the literature above has shown that different authors in institutional theory mean different things when they utilize the concept of translation. A dialogue between Scandinavian and other institutionalists is needed in order to discuss the advantages and disadvantages of different ways of theorizing translation processes. A discussion of the increasing number of empirical studies and empirical evidence related to translation processes is also needed. Different authors have suggested different theoretical conceptualizations of the concept of translation – sometimes on the basis of single or multiple case studies – but more in-depth studies are needed in order to decide which of the models best explain institutional change. The different models point out elements that supposedly influence the translation and institutionalization process. Socially defined editing rules (Sahlin-Andersson 1996), rules concerning the formation of organizational identity (Sevón 1996), and characteristics related to the idea itself (Røvik 1998) and to the patterning of attention (Czaniawska & Joerges 1996) are some of the important elements which have been identified that define the content and direction of translation processes. Still, very few empirical studies exist that try to compare 165


and estimate which of the elements most probably influence the translation and institutionalization of innovative ideas in convergent, as well as divergent directions. One point of view could be that the concept of translation itself – say, as defined by Latour – suggests that change processes are unique. It would, therefore, follow that no generalizable elements exist which similarly influence translation and institutionalization processes. The very concept of institutions, as well as our daily experience of social order, suggests, however, that certain historically institutionalized elements do, in fact, exist. They influence, if not determine, the content and direction of translation processes.

Analysis The third community of researchers are social scientists related to institutional analysis. They focus on the situated changes and processes of bricolage that are set in motion by actors when general ideas and concepts travel in and out of organizations – and across organizational fields – while being translated. The organizational relationships are constructed as consisting of loosely coupled communities of intra- as well as interorganizational translators. Means-ends relationships related to ideas are seen as locally constructed. The idea is seen as moving from one community of translators to another, and as being decontextualised and recontextualized during that process. The process is constructed as a process of association, or translation. At first, relatively few actors (actants in Latours vocabulary) are associated with an idea, but if it becomes powerful, it is because many actors (in some models only humans, in other models both humans and nonhumans) are associated with or mobilized by it. Change is seen as dependent on the possibilities and effects of associating human and sometimes nonhuman elements. Change is often seen as dependent on historically institutionalized elements, which proceed and influence the translation process. What is perceived as a problem in relation to the process are negative rather than positive effects of the process of association. Institutional researchers interested in the travel of ideas in and across organizational fields have adopted and translated the concept of translation. The problems they are currently facing include the following: Several and different models of translation exist, even though not all researchers seem to be aware of this. As a consequence, a dialogue between researchers about the different ways of theorizing the translation process, as well as the empirical evidence 166


related to such processes, is needed. Another unresolved problem is related to a difference between actor-network theory and institutional theory. According to actor-network theory, identifying the factors that might influence a change or translation process is an empirical process, not something that should be decided a priori. The very concept of institution suggests, however, that there are such elements (i.e., institutionalized elements which influence the content and direction of translation processes), which might explain why Scandinavian institutionalists have only vaguely identified such elements.

Comparative Analysis This chapter has considered what the three communities claim to know, and what they currently suggest they need to know about organizational change. What might be learned if the activities and knowledge claims of these research communities are compared? What are the main types of problems they have tried to solve, and which types of problems have they encountered theorizing and analyzing organizational change? The researchers belonging to the EPOC group are trying to find out which types of interventions might assure that evidence-based knowledge about treatments is in fact used (i.e., implemented in clinical practice). The researchers working in public administration and public policy are trying to find out how to handle the fact that in democratic societies it is considered illegitimate if policy decisions decided upon in policy centers are not implemented as intended. They also try to find out how to understand and analyze the implementation of policy ideas. The last community consists of researchers trying to solve a theoretical and empirical question: How are convergent and divergent organizational structures and practices constructed in, as well as across, organizational fields? As demonstrated, the different communities of researchers have based their research on three different basic metaphors about organizations and the nature of organizational change. The characteristics of these metaphors are summarized in table 6.1. Even though the researchers belonging to the EPOC group have managed to provide some evidence for the effectiveness of certain interventions, they conclude that the generalizability of current studies remains uncertain because of their limited understanding of contextual, organizational, and individual factors that influence the effectiveness of interventions aimed at implementing evidence-based knowledge about treatments in clinical practice. There167


fore, they are now looking for a validated theory of human and organizational change on which to base their search for effective interventions. Researchers related to public policy and public administration have moved in the direction of combining models of implementation. Some researchers have suggested a revival of implementation research focusing on general themes present in the implementation literature (e.g., knowledge, learning, and the process of implementation, the role of actors and agents and bureaucratic discretion in implementation). Other researchers focus on the implementation problem. It is also concluded that a validated theory of implementation is still needed and that plenty of work remains. Larger-n empirical studies are especially needed, which may help sort out the many variables identified in implementation studies and flag those that are especially important to the policy implementation process. In connection to this, two research strategies are proposed: One focuses on constructing a general theory of implementation and the other on developing and testing different partial theories and hypotheses. The researchers focusing on change as translation are characterized by not being sufficiently aware of the different models of translation that exist in their community. A discussion of these models and the increasing amount of empirical evidence related to translation processes is needed. The researchers also need to discuss whether the question about which factors might influence a change or translation process is an empirical issue, as suggested by actornetwork theory, or something institutionalized (e.g., editing rules) that may appears to be already established, affecting the content and direction of the translation process. In spite of the differences, the communities have something in common: a dependence on, and an interest in, understanding the characteristics of the processes related to human and organizational change. When compared it could, however, reasonably be concluded that despite some evidence has been presented by the three communities, it has turned out to be difficult to reach clear conclusions about the nature of, and the cause and effect relationships related to, organizational change in all of these communities.

Conclusion On the basis of the analysis it is concluded that each community bases their research on different theoretical perspectives, employing different metaphorical understandings of the organization and the nature of organizational change. 168


Each of these three metaphors has been described in detail and is summed up in table 6.1 under the labels of intervention, implementation, and translation. It is concluded that the research communities have approached the problem of human and organizational change in different ways, and in order to solve different types of problems. The researchers belonging to the EPOC group are trying to find out which types of interventions might assure that evidencebased knowledge about treatments is in fact used (i.e., implemented in clinical practice). The researchers working in public administration and public policy are trying to find out how to understand and analyze the implementation of policy ideas, as well as how to handle the implementation problem. The last community of researchers are trying to better understand how convergent as well as divergent organizational structures and practices are constructed in, as well as across, organizational fields? It is concluded that the three communities have tried to solve different types of problems, but that they share an interest in understanding the processes related to human and organizational change. The reductionist attempts made by the three communities to understand the complex nature of organizational change turned out to be less successful than the researchers, as well as healthcare professionals, had hoped. Even though some evidence exists, it has turned out to be difficult to reach clear conclusions about the nature of, and the cause and effect relationships related to, organizational change in all of these communities. This is the case, despite the considerable amount of research time and effort that these communities have put into doing research in organizational change. The problems encountered by researchers related to the EPOC group are connected to uncertainty over the generalizability of current studies, and a limited understanding of how contextual, organizational, and individual factors influence organizational change. Researchers related to public policy and public administration have also found it difficult to develop a general theory about implementation, and are currently discussing which themes to focus upon in future research. Should they focus on general themes present in the implementation literature, the implementation problem, or development of a general or partial implementation theory? The researchers focusing on change as translation need to discuss the different models of translation as well as the available empirical evidence of translation processes. They also need to discuss

169


how institutionalized elements manifest themselves, and affect the content and direction of translation processes.

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Chapter 7

The Institutionalization of a Routine Identity, Interaction, and Materiality By Niels Christian Nickelsen

Introduction The focus of this chapter is a microchange – the institutionalization of a simple routine, namely the production of an industrial rubber valve, at the bequest of a German customer, in a Danish factory. This work has little, if anything, to do with reorganization or organizational design but, rather, treats change as an appropriation of self by a collective, endowing one with the ability to do something new. Using ethnographic tools to evaluate this as a real-time change process, I study how it is possible to make something new with complicated technical margins in the seemingly fatiguing practices of the factory. More precisely, I follow how this specific and difficult order became engineered into an organizational routine – from a vague description in the technical department, through test production, and finally into a product that met the quality demands. The research questions I intend to answer are: What is an organizational routine? What is the role of materiality in the making of an organizational routine? The theoretical ambition in this work is to contribute to institutionalism, and the literature on organizational routines, by allotting a precise role to the context and the material. Through a theoretical discussion of several perspectives on organizational routines, I argue that materiality plays an important role in


the making of a routine. In my empirical study, I demonstrate that the concept and practice of the valve changes, and that it is identified in a number of ways, as it passes through the testing phase of production. I argue that the negotiation of these changes during test production is the fulcrum in the routinization of the production procedure. It is through these identity shifts that the valve is both reified, and rendered producible and applicable in the customer world. This discussion involves a number of voices from inside and outside the empirical study. It appears that making an organizational routine is neither a straight forward nor a rational process. In order to understand the process of institutionalisation, I take a detailed look at technical intricacy and technical negotiation. As Bruno Latour argues, it is exactly through this detailed interweaving of the technical and the social that we are able to understand transformative effects (2000). Before I present the case study, I will look at a number of articulations of routine, institutionalization, and identity. I start with actor-network theory, which is a thoroughgoing perspective from which to discuss institutionalism and routines.

Actor-Network Theory: Alliances, Translation, Symmetry, and Routine In a programmatic paper, Latour (1991) argues that actor-network theory is concerned with how voices or statements get loaded. He recounts an anecdotal story about a hotel manager whose guests repeatedly forget to drop-off their keys at the front desk before leaving. The manager tries several strategies to alter their behavior. First, he reminds them to bring their keys back, but the effect is negligible. He then puts up a sign that reads, “Please leave your key at the front desk before you go out.” This has some effect, but the majority of the guests still leave the hotel with their keys in their pockets. Finally, the hotel manager talks to an innovator, who suggests attaching a lead block to each key. This works: Now the overwhelming majority of the guests happily rid themselves of their keys at reception before they leave. Drawing on the relevant literature, Latour depicts this narrative as a battle between two programs: leaving versus keeping. The first program, leaving, gains more and more strength by loading itself with a number of elements in syntagmatic chains (e.g., a verbal statement, a written sign, and a lead block) (Latour 1991, 2000). Consequently, the first program becomes convincing. The question about how one voice becomes dominating – a mystery, for instance, to the social constructionist (Gergen 182

The Institutionalization of a Routine

1997; Burr 2003) – is now no longer a mystery. The manager’s voice comes to dominate by enrolling a number of other elements into his network, except that actor-network theorists would never reduce the event of the returned keys to the effect of a voice. Instead they would attribute the effect to the entire heterogeneous network, and they would note how the manager’s initial statement is subtly changed during the process of network expansion (Law 1992). In an actor-network analysis, the number of entities that are included is expanded from merely social actors to entities of any kind. The important questions become: What gets connected and what gets disconnected? Which programs are successful in enrolling allies? Which programs are able to maintain their connections (of whatever kind) over time? Actor-network theory considers agency to be a distributed, relational phenomenon, rather than something that can be located or isolated in human bodies or heads. Latour’s analysis of the narrative of the hotel manager provides a theoretical vocabulary for studying scientific practice and other transformative effects by paying close attention to the processes through which heterogeneous elements are associated into stronger or weaker networks. From this perspective, organizational routines should be seen as configurations of allies that are simultaneously strong and performative. This perspective is close to Feldman and Pentland (2005) who define organizational routines as a recognizable pattern of interdependent actions that are carried out by multiple actors. But how are organizational routines produced across different weaker, or stronger, programs? One could argue that a kind of organizational routine is created after the lead is attached and the hotel guests begin to leave their keys, but what if they get rid of the lead? Once again the problem would resurface. The seminal notion in actor-network theory of translation is helpful in addressing this quandary. Latour states that the word “translation” has more than one meaning. In addition to its ordinary linguistic meaning, it also means to move from one place to another – from one semiotic system to another – thus, translating interests comes to mean offering new interpretations (Latour 1987, 117). In a later work, Latour tells another anecdote about a group of French soil scientists who are investigating whether the rain forest encroaches on the savannah, or vice versa. Researchers collect soil tests from different areas in order to investigate this question. Latour argues that when the soil is put into a pedocomparator (i.e., a device for comparing soil) the identity of this Brazilian soil changes completely. It changes from Brazilian soil to scientific evidence, which is later 183


used at conferences and in scientific papers. During this removal from one place to another the identity of this soil becomes something else. It is translated (Latour 1999, 49). The soil example demonstrates that a material, a concept, a practice – or what I intend to call a routine – may change completely as a chain of actors undergoes the process of borrowing ideas and practices from one another. The spread in time and space of claims, orders, and artefacts is in the hands of people (Latour 1991, 104). Each of these people may act in many different ways, letting the token drop, modifying it, betraying it, or appropriating it; thus, the initial force of the first actor in the chain is no more important than the force of the hundredth actor. Furthermore, it is not possible to know where or when the process concludes. The point is that when an idea, a piece of knowledge, or one end of a routine is moved from one semiotic system to another it will change. It will be identified according to a new set of rules. Organizational routines presuppose some kind of mutuality and interconnectedness. My argument, based in actor-network theory, is that routines arise when a strong and performative program connects entities across contexts in certain interconnected and repetitive patterns.1 In the case of the hotel manager, the point is that he/she is successful due to the fact that the guests now want to rid themselves of the annoying key. The interaction among manager and guests has been routinized. Nobody intends to change the status quo, rather, what we observe is what actor-network theorists call durability (Latour 1991), or obduracy (Law 1998). This phenomenon is in evidence when a number of actors reproduce a particular kind of interrelatedness. As I have argued, materials are crucial in understanding transformative effects and repetitive configurations of any kind within actor-network theory. Now I intend to take a closer look at some articulations of organizational routines in new institutionalism.

State of the Art: Routines as Reproductive Interaction Patterns In 1982, Nelson and Winter made the case for the concept of routines, which – like the concept of the gene in biology – was to be the key for understanding how economies were changing. But today there is still little agreement in

1

Actor-network theorists have not been interested in the problem of organizational routines.

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academia on what routines are, or their effects. Markus Becker (2004) has provided a comprehensive review of the literature on organizational routines. The analysis of the literature emphasizes the collective nature of routines, as opposed to the individual nature of habits. An important point in Becker’s review is that routines do not necessarily lead to inertia, as a popular view would suggest; rather they lead to stability in organizations. Routines provide stability, which plays an important role for learning and for helping change. Moreover, routines integrate distributed elements in practice, help cognitive scarcity, and are embedded in the specificities of particular social practices. This leads to a conception of routines as recurrent interaction patterns that are historical. Here pattern refers to standardized interaction sequences (Jepperson 1991, 145). An institution represents a social order or pattern that has attained a certain state or property, whereas institutionalisation denotes the process of such attainment. Institutionalization can be opposed to the absence of order (i.e., entropy), but can also be distinguished by its lack of reproductive processes. If for instance shaking hands is an institutionalized form of greeting, one takes action by refusing to offer ones hand. The point is that organizational routines are enacted processes. The change of routines takes place by departing from those patterns. Becker concludes his review by noting that because of academic disagreement, routines have not been given the role in organizational theory that Nelson and Winter hoped for.

Routines as Knowledge in Practice Anders Hellqvist (1997) argues that organizations consist of these hard-tograsp routines. Organizational routines simultaneously assume and reproduce organizational knowledge. What he calls practical knowledge is produced when the individual participates in social practice.2 Because the human actor is also characterized by knowledgeability (i.e., the ambition to develop knowledge), routines can be understood as the meeting of individual’s ambition to know and social practice. Hellqvist borrows the notion of the script from cognitive psychology in order to grasp the cognitive mechanisms of organizational life. Drawing on the

2

e draws on what the philosopher of social science and phenomenologist Alfred Schutz (1967) calls H the intentionality of man.

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work of British sociologist Anthony Giddens (1984), he posits that behavior in organizations is developed mostly unconsciously, and is executed more or less automatically. Giddens’ categorization of consciousness includes a split between discursive consciousness and practical consciousness. Practical consciousness has to do with situations where actors perceive activities around them and link their own participation to those activities. Discursive consciousness addresses questions such as: Why is something done? In what way ought something to be done? According to Hellqvist, routines are reproductive patterns of knowing in practice. This does not necessarily mean that reflection and consideration are excluded from routines, as the mainstream literature suggests. Even though a routine is more or less obvious, a routinized situation, for instance, implies that people involved consider what is expected of them and how they meet those expectations.

Identity and Organizational Routine The singularity of the term identity – along with a general contemporary enthusiasm for personal integration, consistency, and individuality – leads to a tendency to see action as a reflection of a stable and consistent self. According to March (1994, 61), identity is a conception of self organized into rules for matching action to situations. Rationality optimistically sees decisions as based on a coherent self. Decisions constitute an evaluation of alternatives informed by knowledge of their consequences, but decision makers are seldomly, if ever, acting on full knowledge. They are always partial and only somewhat rational, in part because of the complexity and ambiguity that are salient components in organizational life. Things can always be interpreted in a number of ways and actions are, consequently, always based on insecure grounds. What March calls the logic of appropriateness is a situation wherein actions are matched to situations by means of rules. Those rules have to do with the identity of the decision maker. According to March, decision makers act on behalf of who they believe they are, rather than on an insight into the consequences of what they do. Decision makers explicitly or implicitly ask questions such as: What kind of a situation is this? What kind of person am I? What kind of organization is this? (March 1994, 58). Identities are simultaneously constructed by and imposed upon individuals. Creating or accepting an identity is, at the same time, a motivational and a cognitive process through which a certain kind of 186


social order and routine is brought into existence. Accordingly, routines turn out to be socially constructed contracts and cognitions that, in subtle ways, connect to identities, organizational structures, material circumstances, and bounded rationality. One of the main arguments for bounded rationality is precisely that cognitive capacity is a scarce resource in organizations (March 1994, 10). Routines free-up cognitive resources and offer the possibility to redirect attention.

Routines as Enacted Narratives According to Barbara Czarniawska, routines are a particular form of human action that should be understood as enacted narratives (1997, 13). The human fabric is constructed in conversation about our lives while we live them. These narratives are collective products; we are never the sole authors or performers. Conversation consists of bits of social positioning that are accepted, rejected, or improved upon by partners in ongoing conversation and action (14). Society is thus performed and routinized in endless chains of conversations and physically mediated actions that are irrevocably tied to one another. Since we spend our lives planning, commenting upon, and justifying what we and other people do, Czarniawska sources organizational knowledge to narrative. From this perspective, the process of organizing appears as a network of nonessential interaction undertaken in an effort to shape performance, outcomes, and human lives. The self is produced, reproduced, and maintained in conversations that are sensible to past as well as present.3 According to Czarniawska, drama, script, and performance are key entities in understanding how organizational routines are shaped. This is not to say that organizational life is theatre, but rather that drama and other forms of self-expression (e.g., autobiography) are crucial elements in shaping everyday narratives and routines. The leader’s role is to provide the rest of the cast and the audience with the illusion of control, even though control of joint action is not possible. No one is, or could be, in charge of symbolic interaction (40). Still, a leader who fails to provide this illusion, by revealing the paradox of social control rather than resolving it, cannot continue to stay in the role. Individuality is an institutional myth developed within rational theories of choice – a myth that, according to Czarniawska, continues to be attractive due 3

In making this argument Charniawska draws on the American pragmatist, Richard Rorty (1989).

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to the need to keep up the illusion of control and accountability in organizations.

Different Articulations of Routines and the Role of Materials I have discussed and articulated four perspectives on organizational routine that focus on the construction of recurrent and patterned interaction: Bruno Latour, Anders Hellqvist, James March, and Barbara Czarniawska (see table 7.1). I have already argued that routines in an actor-network theory ontology are constituted by a power struggle between chains of allies. I have also posited that materials are explicitly allotted a role in stabilizing networks. Neither Hellqvist nor March sufficiently theorize how connection between routines and materials takes place. Organizational routines are constructed as:

Role given to materials

Bruno Latour

The emergence of strong programs of heterogeneous allies that gain power over weaker and less performative programs

Materiality is allotted a crucial role since allies in strong programs can be human as well as nonhuman.

Anders Hellqvist

The meeting of the knowledgeable individual and a social practice – knowledge is performed in practice through routines

None

James March

A logic of appropriateness – the identity of actors and rule following in order to free-up scarcity in cognitive capacity and attention

Routines are cognitions and contracts that connect to organizational structures and material circumstances.

Collectively enacted narratives and commenting on daily dramas and life problems in order to control outcomes, performances, and human lives

Routines are performed in conversation and physically mediated actions.

Barbara Czarniawska

Materials exist as circumstances that are muted.

Materials exist through physically mediated actions, but are weakly articulated.

Table 7.1. How are Routines Made and what Kind of Significance is given to Materiality?

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In Czarniawska’s work, on the other hand, the material is articulated as something that appears through physically mediated actions. But like March, it is weakly articulated. As I have already argued organizational routines, from an actor-network approach, are a matter of powerful and performative connections among humans and nonhumans in strong and repetitive programs.

Meeting the Studied Field This study is constituted by ethnographic fieldwork done in AVK GUMMI A/S, a moulded rubber producer in Låsby, Denmark. AVK GUMMI A/S delivers technically complicated products with high margins to a demanding global market. It is an expanding company that started producing simple rubber toys in the 1950s. The managing director, Knud Flemming Madsen, was appointed in 1980 and since that time, AVK GUMMI A/S has grown continually in size, sales, and technical capacity. Madsen is known to be a highly competent technician, designer, and manager. The following observations focus on the making of a ball valve, a colander-like metal body covered with rubber, which constitutes an important part of a closing mechanism. The ball valve is exported to a German customer for pharmaceutical application in facilities throughout the world. The difficult part of the production process is to meet the demand for high-grade rubber that covers the metal body in four different qualities. It constitutes a particular problem to get the ball valve out of the moulding tool (see figure 7.1).

Figure 7.1. The Ball-Valve in the Moulding Tool 189


I worked for almost two years as an ethnographer-activist, borrowing a term from Marcus (1995). I was trying to understand how it was possible to keep up several orders and interactions among them in a mundane practice. I was interviewing and observing the everyday work of engineers, managers, planners, mechanics, and operators in the plant. I recorded – using both still photography and video – procedures, and collected and studied forms, descriptions, statistics, and summaries of meetings. It was a condition of my attendance that I give something back, so I participated in the steering committee where I offered advice based on my growing understanding of the firm’s practices. I focused helping to structure arrangements whereby discussions on the social and technical problems of launching new products could continue after my absence. In four, one to two day seminars, my observations were discussed with a group of twenty people that consisted of the management group, engineers, work foremen, shop floor stewards, and other key persons. From these conversations, I developed further observations on routines in the company. Establishing configurations to enable the continuation of these discussions was important. I was precisely interested in how it could be possible to maintain order fulfilment and produce these new difficult products at the same time.

Case Description Part 1: The Effort of Casting a Valve at AVK GUMMI A/S In the following case study I will introduce several key players in the case study: the test manager, Jens; the technical manager, Erik; and the logistics manager, Finn. While reading the following passage, I invite the reader to focus on the role of rubber, of the moulding tool, and other tools and materials. Jens stands at a workstation. He runs some ball valve trials. The customer had earlier ordered the valve from a firm in Holland, but has recently switched to AVK GUMMI A/S. The ball valves are used in dairy plants. Jens has worked on this task for several days when I meet him. The difficulty of this test production is that the customer has ordered the ball valve in four different rubber qualities. Different rubber qualities mean different colors. The lighter colors easily become unclean so it takes a lot of effort to change color, both because

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of cleaning and the time consuming shifts during the process. Jens first tries EGF, a very robust type of rubber. The ball valve is particularly difficult because a colander-like metal body is to be moulded into the item in order to strengthen it.

Figure 7.2. Erik and Jens Scrutinize the Inlet of Rubber to the Moulding

The present difficulty is that the moulding process leaves small dents in the upper ring of the items. These dents constitute a serious quality problem because of the later risk of leakage. Jens draws up the machine protection grid. He casts a flaked item.4 He investigates how much rubber is drawn into the moulding tool and adjusts the control panel. He is very careful, because if too much rubber is drawn into the tool he has to strip the tool down and clean it. The protection grid is drawn up again and a new item is cast. There is still too little rubber in the moulding tool. He gives it another couple of millimeters on the control panel. He investigates the item intensely and some small cracks on 4

I use the term “casting” several times. It denotes the sometimes difficult process of picking out the moulded item from the moulding tool.

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the side of the valve. He turns down the heat on the control panel. Jens casts another item. This time it looks somewhat better. “There are ‘fins’ on it, but that is a trifle!” he exclaims. While still hot, he examines it and states that it is possible to see a line where the rubber runs together. He is not satisfied. A planner and a production technician contemplate Jens’s efforts. They are worried because this test is taking too much time. They had planned another batch to be run on this machine, and they are concerned that the time needed for testing will cause production and delivery delays. They suggest that Jens bring his trial production to a close, and quickly. Jens casts another item, this time using a compressed air pistol. He experiments by giving a lot of air at the edge of the item in order to help it come off easily, but he simply cannot get it out of the moulding tool. He finds a little brass device and tries to force the item out. The device just bends as he presses. He stretches out the brass device with a hammer and tries once again. This time he succeeds. “For the first time, the item looks like it is supposed to,” he says. The only problem is that Jens has damaged the edge with the brass device as he cast the item. Consequently, he immediately takes off the rubber from the metal body with a pocket knife. He gives the metal body a large amount of lubricant and draws off the remaining rubber. He cleans it with compressed air in order to reuse the colander-like metal body. He turns to the machine control panel and saves the machine parameters in a set-up map.5 At this moment he finds the parameters are close to what they should be in order to initiate an actual production of the ball valve. When he casts the next item he experiments again with the compressed air pistol. He does not succeed, so he must use the brass device again. Again, he has similar problems. The logistics manager comes to the work station to tell Jens that the customer is on the phone. He says that, “They plead for the commodities. … We have tried this before where we also did not succeed. Now the customer has spent a moulding tool and we try again. But I think when Madsen [the managing director] comes on Monday the conclusion will be that we are not willing to stand up for more trouble with this valve. Where is the project manager? He is on vacation! Where is the technical manager in this situation? I think I take 5

T he set-up map is a significant written recipe. It is a kind of reified routine that is distributed to different professional groups in the firm. The set-up map informs the participating professional groups of their contribution to a particular new product. Jens can not finish the set-up map before he has found the way to make a routine out of this new and complicated order. On the performance of the set-up map, see Nickelsen 2002.

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this hammer with me to his office.” He then looks at the hammer, touches it, and concludes, “No! It is soft. It will not do.”6 Jens casts another item. This time it actually goes quite well. He gets it out quickly and without destroying it during the casting. Then he says, “This can possible be approved as the worst item in a batch. But that is not good enough. We will get nothing but trouble out of it! When the item is produced our experience is that it collapses a bit and gets worse. If it does not run smoothly during the test production, it is a strong indication that trouble will show up later.” He concludes decidedly, “We have to inform the customer that we are not able to do this.” Jens once again scrapes the rubber off the metal body. The logistics manager walks away seemingly satisfied without commenting on this convincing statement.

Analyzing the Case: “Rubber is Alive,” or the Difficulty with Controlling Rubber The test manager focuses on three areas: 1. He spends quite a long time trying to make sure that the rubber covers the metal body, but he repeatedly encounters the same difficulty–a problematic confluence of rubber can be seen on the backside of the valve. He believes this constitutes a considerable functional problem and that it is enough to dismiss the item. 2. He tries persistently to find a solution to the casting problem. He concludes, after some time, that the compressed air pistol does not work. He subsequently develops an alternative casting tool – a simple brass mandrel. 3. He focuses on the control panel parameters. He does this in order to complete the set-up map and to make sure that the zero series that follows does not collapse. After repeated setbacks and a prolonged test production, Jens loses his faith in the possibility that a successful serial production is possible. He even tells the pessimistic logistics manager that the customer should be told that AVK 6

I have taken this passage into the text not to put the logistics manager in a compromising light. Rather, my point is to demonstrate that this complicated routine is produced in tension. The situation also demonstrates the role of irony and humor in managing conflict among professional groups.

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GUMMI A/S cannot produce the valve. He decides to go to the technical manager for help. Part 2: Handing Over the Uncontrollable Product Jens walks into the technical manager’s office and explains the difficulties. The technical manager is silent for a long time while he intensively scrutinizes the one and only acceptable valve that has been brought into his office. Then he says, “We must have drilled the furrows. They are too narrow.” Jens offers his primitive bass mandrel. “What about the casting? I have made this casting tool!” “No,” says Erik. “What is needed is air. We have defined it during the tender process. We must not give up until all the possibilities have been tried out.” They both decidedly walk to the machine at the shop floor. The technical manager curiously investigates another valve while it remains in the moulding tool (see figure 7.2). He casts the tool easily and gently. The technical manager examines the condition of the rubber at the inlet. He states that it is sufficiently soft. “We can do this,” he states, exhilarated. Erik seems to be very focused on ending this test production as fast as possible. He picks up a metal body from a bin besides the workstation. He sees that they have only been painted on the exterior side. “Maybe it goes easier if they are painted on both sides,” Erik directs Jens to “get some paint on these metal bodies.” Jens hurries to the component department. The protection grid goes up once more and the tool parts split. As always, the valves sit on the upper part of the tool. Erik takes the brass mandrel and casts the valve with an elegant move. Jens has already returned. “The inlet of the tool has to be corrected. It costs [DKK] 4,000–5,000 at the external toolmaker and takes a couple of days,” Erik claims. “The casting tool must be applied with a handle, so it is comfortable to use for the operator. This is nothing,” he crows. “I have been standing with things like these for months and at last I had to change all the furrows.” Erik leaves. Jens can now write data from the control panel directly into the set-up map because the technical manager finds the item satisfactory, though yesterday, the technical manager was wholly unsatisfied. This conflict does not seem to bother Jens at all. The projection grid goes up and Jens is now supposed to cast the way Erik instructed him. “This is easy,” he states while he is doing it. He puts the valve on the table and immediately cleans the tool parts with the compressed air pistol. While the new item cools down he puts a new metal body into the tool 194


and presses the start button. He turns his body 180 degrees and investigates the cooled valve on the table. It looks reasonable. There is small amount of rubber residue on the inside. After the metal bodies have been fully painted it is more difficult to make the rubber flow all the way around and cover the metal body. This is because the painting works as a binding material. On the back side an opening to the painting and the metal body can be observed. According to Jens this does not matter. He grinds down the fins and the veils and jots something down on the set-up map. He begins to prepare the finished items for after-vulcanization in the kiln. He starts to cast the next item. He still has not made one item without a defect. He gives plenty of compressed air this time around the item and presses with his little homemade casting tool. Jens destroys a little gasket when he casts this item, but otherwise the valve looks fine. The next item that is cast looks really good. The items are becoming better and better. “Possibly this casting tool is too complicated for the operator to use. If this is going to be the case, we will continue with Erik’s ideas concerning compressed air,” Jens says. The item he casts now is the best he has made so far. He places it on a grid with the other acceptable items. Then he starts to screw-off the moulding tool. After a few days the moulding tool came back from the toolmaker. The toolmaker drilled out the furrows, which helped the inlet of rubber. The rubber now covered the metal body more easily, but this did not help the valve to release. The test productions continued from March 2001 to November 2001 when it was finally decided to construct a cunning and very particular device connected to the moulding tool to push out the items. The handle activates an eject mechanism, which shoves out the valves of the insertion from within. Two specific kinds of rubber where linked to the casting problems. Finally, after eight months of testing the valves were produced as a serial item in four types of rubber.

Analyzing the Case: Re-Identifying the Uncontrollable Object When Jens, after four days of fumbling without much improvement, walks into the office of the technical manager a sudden change occurs. The technical manager not only has a more optimistic view on the process, he has also luck in his experiments with casting the objects. He instructs Jens how to do casting more elegantly and easily, and the items begin to look like they are supposed to. The identity of the ball valve is translated. It can be observed that Jens’s 195


performance, as well as his point of view, changes at this moment. Suddenly, the earlier problematic confluence of rubber on the back of the valve does not constitute a flaw. He begins to believe they can make it. It is interesting that the technical manager participates differently. Erik states that “rubber is alive.” He argues that the parameters of rubber production cannot be controlled; therefore, experience and bodily, tacit knowledge are crucial to engineers at AVK. As Hellqvist maintains, routines appear when the ambition to know meets practice. In this case study, we can observe two ways of knowing. The technical manager directs attention toward completely different targets than does the test manager: 1. Erik is, first and foremost, interested in the inlet of the rubber and the size of the furrows. 2. He focuses on the softness of the rubber. He spends a lot of time sensing by hand whether the rubber is soft enough to flow into the moulding tool, and whether it conforms entirely around the metal body.

Routines as Double Interacts Erik’s participation hardly makes much sense alone. His redefinition probably qualifies as one side of what Weick calls a double interact (1979, 110). Double interacts are participations that are meaningless without the other and that together constitute a somewhat stable subassembly. In an interesting study on error-free performance of flight operations on aircraft carriers in the Pacific, Weick and Roberts have argued that routines can be disrupted and disaster can happen if participants in a collective start acting heedlessly. By “heedless” they mean a manner that is more individual than collective, and thus not sensitive to the others (2001, 272). Erik only argued that the inlets needed to be enlarged because Jens, over the course of several days, had demonstrated the hopelessness of carrying out the production within the existing conditions. This could actually be considered a heedful interaction. The technical manager is acting and deciding on behalf of the specific experiments carried out by Jens. Both are occupied with subtle bodily knowing, with sensing, smelling, and observing. They are both sensitive to the other, but Jens observes the process of casting and of the confluence of the rubber, while Erik observes the state of the furrows and the softness of the rubber. The point is that the observed interaction is institutionalized, in the 196


sense it is interrelated. There are, indeed, mutual ways to identify technical problems. Yet Erik and Jens are, despite this mutuality, still not able to make a quality product according to the demand.

Performative Materials Together, Erik and Jens identify the state of the routine according to the responses they face through their mutual exploration. By watching, sensing, and smelling they receive important cues on what to do next: (a) how to produce a simple brass mandrel; (b) how to use the compressed air pistol with an elegant bodily movement; (c) how to paint the metal bodies on the inside; and (d) how to drill the furrows. In other words, they identify their way of practicing this test production not only in symbolic interaction with each other, but also in close exploration of the material conditions. Not only do they link to the acts of the other, they also analyze the appearance of a number of materialities. Because of the number of tests and the fact that Jens has spent four days dealing with the rubber, the manager acknowledges that there is a problem with the technical process. The moulding tool needs to be fixed. Changing the movement of the operator is no longer sufficient. Erik apprehends that an eject mechanism must be constructed so that the valve will release. At this moment, the material condition of the situation becomes significant. All the materials – the rubber, the furrows, the brass mandrel, and the compressed air that does not work – seem, in conjunction with the powerless test manager, to be “authors of consequences.” The materials seem to be performative as they participate in the construction of the difficult ball valve routine.

The Introduction of External Pressure and Temporal Order This is yet another important participant – the logistics manager, Finn. He tells of the trouble the designers had the last time they experimented with ball valves and he feels that the firm should stop attempting to produce them. The performance of the logistics manager reveals that there are loose couplings among entities at AVK (Orton and Weick, 1990). Moreover, Finn frankly introduces a kind of temporal order. According to him, the test production must immediately be finished because: 1) there are other batches to be made at the current work station; 2) the customer is pleading for the product; and 3) the technicians are having repeated difficulty with the rubber and moulding tool. 197


This leaves the ball valve production with qualities that resemble garbage can decision processes (March 1994, 198). Finn strengthens his own position by referring to the customer’s wishes, for whom he apparently acts as a spokesman, and by assuming the role of the absent managing director. Finn not only introduces a temporal order, he also constructs his points as external pressure. Finn’s participation demonstrates that the routines of the ball valve are made in tension. I will return to this point.

The Role of Narratives As the ball valve test production is displaced from the production hall into the technical department, the routine changes from the seemingly impossible to the possible. The small problems that worried Jens are suddenly of absolutely no significance. The salient point is that the immediate and surprising identification of the product and the routine, as it is displaced across the organization, is an important element in institutionalization.7 When the technical manager took over it immediately came to resemble an instance of hegemonic singularization.8 It is also worth bearing in mind Czarniawska’s (1997) discussion about leadership’s need to sustain the illusion of controllability. Erik not only changes the procedure informed by the tests done by Jens, but also argues convincingly for a particular way. He maintains a belief that the parameters can be controlled, even though at other times he is the hardest critic of modern dreams of full technical control.

L ater it became apparent that the technical manager’s identification of the routine as something easily done was not accurate. As soon as the moulding tool came back from the external toolmaker it appeared that the technical problem was not limited to the fact that the furrows were too narrow. It appeared that the project manager had a point that the casting could not be done with the use of compressed air. The casting once again appeared to be a serious problem. 8 Hegemonic singularization refers to a management style that can sometimes be observed in outcome-focused technical environments (and elsewhere). The problem in hegemonic singularization is that it does not accept multiplicity (i.e., that there are several ways to accomplish the same task). It is obvious that there are many ways to achieve the goal of making rubber, a tool, and an operator work together: using technical instruction, trying a new rubber mix, changing tools, negotiating quality demands, etc. I find it relevant to keep open the possibility that a more appropriate way of considering this particular difficulty might have defined the furrows and the casting as juxtaposed problems. See Nickelsen 2002. 7

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It is exactly through this continuing negotiation of identity, between internal and external orders, and between paradigm shifts, demands, and specifications that the ball valve routine is made useful for the customer. It is by conflict, by sensing the material, by power, and by conjecture that engineers and workers at AVK GUMMI A/S are able to produce high-quality valves.9 Practical, constructive action provides the best solutions to the world’s problems, rather than superior organization, a modernist model, an a priori common goal, or the complete master plan. Interpretive orders end up as actionable collective solutions by improvising and using available facilities pragmatically. What is striking about this case study is the almost complete disagreement between the various actors about how to proceed (see table 7.2). Test manager: Jens

Technical manager: Erik

Logistics manager: Finn

The rubber mix

Lack of confluence

Not soft enough. Cannot stick due to lack of paint on the metal body

-

The casting tool

Brass mandrel. Compressed air does not work

Compressed air. Brass mandrel is too primitive – not useable for the operator

-

The moulding tool

Will not release

Furrows not large enough. Should be drilled

-

The ongoing production process

Difficult to control parameters

Easy, but rubber is “alive”

Ought to be ended immediately due to earlier experiences

The customer

-

-

Keeps phoning to plead for the commodity

Collaboration among entities in AVK

Engineers often do not end new orders, but leave the process too early

Operators do not read specifications thoroughly enough

The technicians are not there when they are needed

Table 7.2. What is Identified as the Problem and by Whom?

9

In many ways, this process resembles what Levi Strauss (1962, 11–49) articulates as bricolage or the science of the tangible.

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As mentioned previously, the focus is directed towards performance of the material and strikingly little is discussed openly. Jens and Erik are practically mute while Finn is mostly rebuking. Different kinds of participation, materiality, and power seem to be important actors in the making of the routine, whereas narratives seem to play a more peripheral role (e.g., experiences referred to from earlier innovations). This study only partly verifies Czarniawska’s (1997) claim that action and routines are produced by actors who comment upon, plan, and correct others narratives in order to make collective orders. Moreover, the limited conversation between the actors highlights the performative role of materiality (see table 7.2). Erik claims several times during the process that “rubber is alive.” By inscribing life to the material, Erik reinforces the idea that the parameters cannot be controlled. The technical manager replicates this narrative and simultaneously produces patience and acceptance for annoying and time-consuming technical intricacy. It is important to note that Erik focuses on the performance of the material rather than on formal procedures, departments, professional groups, individuals, or leadership. The statement that “rubber is alive” becomes, in effect, a kind of war story. Julian Orr (1996) is interested in what so-called war stories can do to communities.10 He argues that narrative communities are built through stories about the performances of materials from the field. Those narratives make it possible to continue work and collaboration in hopelessly complicated situations. In opposition to this important empirical observation, Nelson and Winter (1982), March (1991, 1999), and Hellqvist (1997) seem to be more or less unconcerned with the performance of things.

Tensioned mutuality Weick (2001) conceptualizes organizational learning as a matter of confirming an oxymoron. Organizational learning is articulated as a process that oscillates between building and breaking routines. At AVK GUMMI A/S, the engineers perform a sort of informed conjecture in order to arrange the ball valve routine. They engage in creative experimentation, where imagining is an important activity. For instance, Jens has to imagine what would serve well as a 10

J ulian Orr describes in an important study (1990, 1996) how so-called REPs (copier repair technicians) build up a narrative community through war stories, which allow them to work with otherwise hopelessly technical and misguiding manuals.

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casting tool. Even though he has done something that resembles this situation on a number of other occasions, he has never been in quite the same quandary before. Likewise, Erik has to imagine what to do about the restricted inlet of rubber. The logistics manager has to imagine what to tell the customer. The empirical material laid out in this paper demonstrates that making routines in industry is a process of tensioned and interpretive interaction. Figure 7.3 is an illustration of the participants and their different foci. The outer dotted line represents the boundary of the organization. It is by tensing those differences that the making of the ball valve routine is made possible.

Figure 7.3. Tension among Participants, Materials, and Tools

The modernist ideal of zero-order production implies that demand comes close to meeting the production of new orders. The continually increasing customer demand on quality leads to a situation where traditional engineering devices, such as the set-up map, are insufficiently sophisticated to ensure adequate collaboration among groups and avoid errant processes. The managing director at AVK GUMMI A/S believes that the lack of “communication” and collaboration among professional groups constitutes the main barrier for finishing tests. It is hardly surprising that a broad and unclear phenomenon like communication is argued to be the core problem. In this case, there appears to be a kind of attribution error (Hackmann 2005). After closer analysis, it is exactly the loose coupling among professionals and the fol lowing negotiations that makes it possible to finish the test production. The 201


routine is produced through the interpretation of interaction, the coordination of different dimensions of action, improvisation, and analysis of the material, and negotiation of conflicting views. In the end, it becomes possible to establish the set-up map, which acts as a kind of freezing (Gold, 1999) of a successful and performative heterogeneous network that will endure for some time, though probably not very long in this case since “rubber is alive.”

Conclusion In my analysis of the valve production, the notion of connectedness among heterogeneous allies, programs, and translation became apparent as a productive mechanism through which to identify technical problems, process flow, and interrelatedness. This connectedness, in collaboration with the seemingly simple ontology in actor-network theory of a priori symmetry between heterogeneities, was useful in elucidating the significant role of materials in innovation. My conclusion is that the role of materiality in producing routines is vaguely articulated, if not decidedly ignored, by new institutionalism. The detailed empirical work of my case study reveals that a number of materials are significant in the process of arranging and repeating certain performative socio-technical configurations of people, materials, and tools. Moreover, it demonstrates that conversations and narratives at AVK GUMMI A/S circle around the performativity of materials. The study also demonstrates that work of new institutionalists like March and Czarniawska, as well as symbolic interactionists like Weick, fits together well with the actor-network theory perspective. Even though Latour convincingly argues that objects have agency (2005, 63), upon closer examination it is evident that the agency of humans and non-humans differs. To argue that materials have intentionality is highly counterintuitive, while arguing that intentionality is exclusively for humans is not. The narrative about rubber can hardly be contemplated in an actor-network theory optics. This is not a retreat from the focus on the interweaving of humans and nonhumans; rather, I am arguing that programs and alliances of humans and nonhumans (actor-network theory), narratives, identifications, and mutuality (new institutionalism and symbolic interactionism) are supplementary perspectives that articulate different, but equally important aspects of organizational routines.

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In contrast to the common sense view, which suggests that routines are simply followed, this paper points to the central importance of materiality, but also to tension and power relations among departments, professions, and actors in organizations. The conclusion is that organizational routines do not simply constitute some kind of truce as, Winter and Nelson (1982) argued; rather, they are effects of translations and negotiations among coalitions. Finally, it is important to point out that there are methodological as well as practical implications. First, new institutionalists ought to be equipped with a higher degree of empirical sensitivity. They should develop concepts that reveal, in more detail, what is currently only vaguely conceived as physical mediation or material circumstance. Second, practitioners who act as, for instance, consultants that contribute to stabilizing or changing organisational realities should not simply direct their attention towards narratives and structures, but also towards the subtle and nearly invisible, detailed material conditions of everyday organizational life.

References Becker, M.C. 2004. Organizational Routines: a review of the literature. Industrial and Corporate Change, 13(4): 643-77. Borum, F. 1995. Strategier for organisationsændringer. Copenhagen: Handelshøjskolens Forlag. Brunsson, N. 2003. Organised hypocrisy. In Northern lights: Organisation theory in Scandinavia, edited by B. Czarniawska and G. Sevón. Copenhagen: Liber, Universitets Forlag, and Copenhagen Business School Press. Burr, V. 2003. An introduction to social constructionism. London: Taylor and Francis. Czarniawska, B. 1997. The narrative in culture studies. In Narrating the organization: Dramas of institutional identity. Chicago: University of Chicago Press.

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Feldman, M., and B. Pentland. 2005. Organizational routine and the macro actor in actor-network theory and organizing. In Actor-network theory and organizing, edited by B. Czarniawska and T. Hernes. Copenhagen: Liber, Universitets Forlag, and Copenhagen Business School Press. Gergen, K. 1997. Virkelighed og relationer. Virum, Denmark: Dansk Psykologisk Forlag. Giddens, Anthony. 1984. The Constitution of Society – Outline of the Theory of Structuration, Polity Press, Cambridge. Gold, M. 1999. The Complete Social Scientist: A Kurt Lewin Reader, American Psychological Association Hackmann, R. 2005. The psychology of leadership. Cambridge, Mass.: Harvard University Press. Hellqvist, A. 1997. Praktik och ideer: Om organisationsrutiners betydelse i förändringssammanhang. Ph.D. diss. Linköping, Swed.: Ekonomiske Institutionen. Jepperson, R.L. 1991. Institutions, institutional effects, and institutionalism. In The new institutionalism in organizational analysis, edited by W.W. Powell and P.J. DiMaggio. Chicago: University of Chicago Press. 143-163. Latour, B. 2005. Reassembling the social: An introduction to actor network theory. Oxford, U.K.: Oxford University Press. –––. 2000. Where are the missing masses? In Shaping technology/building society: Studies in sociotechnical change, edited by W.E. Bijker and J. Law. Cambridge, Mass.: MIT Press. –––. 1999. Pandora’s hope. Cambridge, Mass.: Harvard University Press. –––. 1991. Technology is society made durable. In A sociology of monsters, edited by J. Law. London: Routledge.

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–––. 1987. Science in action. Cambridge, Mass.: Harvard University Press. Law, J. 1998 (2001). Ordering and obduracy. http://www.lancs.ac.uk/fss/sociology/papers/law-ordering-and-obduracy.pdf Law, J. 1992. Notes on the theory of actor-network: Ordering, strategy, and heterogeneity. Systems Practice 5(4) 379-393. Levi-Strauss, C. 1962. La pensee sauvage. Paris: Plon. March, J. 1999. The pursuit of organizational intelligence. Malden, Mass.: Blackwell Publishing. –––. 1994. A primer on decision making. New York: Free Press. Marcus, G. 1995. Technoscientific imaginaries: Conversations, profiles, and memoirs. Chicago: University of Chicago Press. Meyer, J.W., and B. Rowan. 1991. Institutionalised organizations: Formal structure as myth and ceremony. In The new institutionalism in organizational analysis, edited by W.W. Powell and J.P. DiMaggio. Chicago: University of Chicago Press. Nelson, R.R. and S.G. Winter. 1982. An Evolutionary Theory of Economic Change. Cambridge, MA.: The Belknap Press of Harvard University Press. Nickelsen, N.C. 2002. Multiple indsatser i industriel produktudvikling. In Forskning i praksis, edited by S. Scheuer and K. Kreiner. Copenhagen: Nyt fra Samfundsvidenskaberne. –––. 2002. Moulding singularity: Examining multiplicity in designing. Papers in Organization, no. 46. Department for Organization and Industrial Sociology, Copenhagen Business School. 30. –––. 2003. Arrangements of knowing: Coordinating procedures, tools, and bodies in industrial production. Ph.D. diss., Copenhagen Business School. 205


Nielsen, K. 2005. Institutioner og adfærd: Vaner, rutiner, regler og normer. In Institutionel teori: En tværfaglig introduktion. Roskilde: Roskilde Universitetsforlag. Olesen, F. 1996. Konstruktive studier af videnskab og virkelighed: Fra sociologi til kulturforskning. Philosophia 25:3-4. Orr, J. 1990. Sharing knowledge, celebrating identity: Community memory in a service culture. In Collective remembering, edited by Middleton and Edward. Thousand Oaks, Calif.: SAGE Publications, 20, 169-189. Orr, Julian. 1996. Talking about Machines. Cornell University Press Orton, J.D. and K. Weick. 1990. Loosely coupled systems: A reconceptualisation. The Academy of Management Review 15(2) 203-223 Røvik, K.A. 1998. Moderne organisasjoner: Trender i organisasjonstenkningen ved tusenårsskiftet. Bergen, Norway: Fagbokforlaget. Sahlin-Andersson, K. and G. Sevón. 2003. Imitation and identification as performatives. In Northern lights: Organisation theory in Scandinavia, edited by B. Czarniawska and G. Sevón, Montreal: McGill-Queen’s University Press. Weick, K. Organizational learning: Affirming an oxymoron. In Handbook of organization studies, edited by S. Clegg, C. Hardy, and W. Nord. London: SAGE Publications. –––. 1979. 2d ed. The social psychology of organizing. New York: McGraw-Hill. Weick, K., and K. Roberts. 2001. Collective minds in organizations: Heedful interrelating on Flight decks. In Making Sense of the Organisation. Blackwell Business.

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Section II CHANGING SOCIETIES

Chapter 8

Ideas in EU Decision Making Towards a Typology of Ideas and Ideational Change By Kennet Lynggaard

Introduction There is by no means agreement on the nature and role of ideas in decision making. Sometimes ideas are seen as issues – for instance, regarding a media or political agenda – which may, if subject to redefinition, give momentum to policy change (Baumgartner and Jones 1993). Sometimes ideas, or more accurately sets of ideas, are seen as paradigms, which set out the interpretative framework guiding the choices of policymakers regarding the problems that ought to be addressed, objectives to strive for, and strategies to employ in a particular context (Hall 1993). Sometimes ideas are seen as information or knowledge that enhances existing knowledge and which may give rise to more efficient institutional designs (North 1990). Finally, ideas may be judged by their persuasiveness. For instance, certain ideas may bring about change in a particular context if they are – in an “ideal speech situation” – considered trustworthy and advocated by agents with enhanced powers of persuasion (Risse 2000). It is against this background that most recent research on the role of ideas in decision making has recognized the need to differentiate between types of ideas, and begun the work on developing typologies of ideas, including suggestions as to their varying implications for decision making. Though it may not be expedient, or even possible, to reconcile differences within the literature, the classification of ideas is worth pursuing in order to enable both


theoretical and empirical cross-fertilization. Essentially, the point of departure of this chapter is the acknowledgement that it will be impossible to assess the role of ideas in decision making until we begin to differentiate between different types of ideas (Campbell 2004, 151). The discussion in this chapter goes further by investigating how resistant, or susceptible, different types of ideas are to change. Most often, different types of ideas are defined in terms of their resistance to change and the susceptibility of ideas to change is theoretically argued. Using the example of ideational change within the Common Agricultural Policy (CAP) of the European Union (EU), this chapter will empirically question the susceptibility of types of ideas to change. That is, putting aside the investigation of how ideas may be related to institutional and policy change, the discussion takes a step back and directs attention towards identifying different types of ideas and how their susceptibility to change may vary. The discussion is organized as follows: After a brief introduction to recent research on types of ideas, mainly regarding EU decision making, a typology will be elaborated that differentiates between theoretical, normative, analytical, and cognitive ideas in terms of their discursive structure, and preliminary suggestions will be made on how different types of ideas may vary in their susceptibility to change. The susceptibility of types of ideas to change is considered an empirical question and is the objective of the second section, which focuses on the articulation and institutionalization of different types of ideas within the CAP of the EU. Concluding remarks are made in the third and final section.

Towards a Typology of Ideas and Ideational Change Research concerned with ideas in EU decision making has recently begun more systematically to differentiate between types of ideas – typically between normative and cognitive ideas (Schmidt 2002; Schmidt and Radaelli 2004). Schmidt (2002), for instance, suggests that normative and cognitive ideas (or arguments) are interdependent in the process of policy reform. Normative ideas, which may be used by decision-making elites to introduce and legitimize policy initiatives, need to be grounded in sound cognitive ideas about the viability of, for instance, a particular policy program. Cognitive ideas, on the other hand, need to be linked up with normative ideas about the appropriateness or legitimacy of a policy reform (Schmidt 2002, 171). Either way, what is 210

Ideas in EU Decision Making

emphasized is the persuasive function of certain ideas, whether in terms of the necessity or appropriateness of a particular policy initiative. Concerned with the role and use of expertise in EU decision making, Radaelli (1999) forwards a typology differentiating between technocracy, epistemic communities, and bureaucratic politics, and contrasts these to political deliberation or politicization. It is suggested that the type of expertise that may prevail in a particular policy field depends on the degree of political salience, or public attention, as well as degree of uncertainty attached to a given political issue. The types of ideas in focus are thus various kinds of expertise, which are associated with different types of decision-making logics. Most recently, a fourfold typology of ideas has been forwarded by Campbell (2004, 1998). In his work, he acknowledges that types of ideas vary as to their implications for decision making including institutional decisions, but he also indicates that ideas may vary as to their susceptibility to change. On the one hand, there are those normative and cognitive background assumptions – termed public opinion and paradigms by Campbell – which may be seen as more susceptible to change, since such ideas tend to remain uncontested and to be taken for granted. On the other hand, there are those normative and cognitive ideas explicated in the foreground of decision-making processes – termed frames and programs by Campbell – which may be seen as more susceptible to change, since such ideas are regularly tested against alternatives that form, essentially, the basis for explicit choices. That is, ideas are organized hierarchically, and certain ideas are considered more fundamental, and thus less susceptible to change, than others. The typology elaborated below draws widely on the literature on ideas in decision making regarding the implications and aspirations of, as well as the agency giving momentum to, different types of ideas in decision making. The susceptibility of different types of ideas to change is, however, posed as an empirical question rather than one of definition. Rather than defining different ideas in terms of their likeliness to change, ideas are defined in terms of how they come into being. Ideas are seen as coming into being through articulations, and are thus defined in terms of their discursive structure. It is argued that the way different ideas are articulated has implications for decision-making processes in terms of, for instance, the establishment of choices between alternative policy options and causes of action. Types of ideas may also be characterized in terms of, for example, whether they aspire for legitimacy or efficiency, as well as the type of agency that may give momentum to change. It 211


is these definitions, implications, aspirations, and types of agency that will be elaborated below.

Theoretical Ideas Theoretical ideas may be defined as the type that come into being when theoretical causal assumptions are linked with empirical data, and when the insight of this link in turn establishes a concern about future development (Pedersen 1995).1 Based on explicit causal assumptions and data about the real world, theoretical ideas are predictive. Theoretical ideas thus establish a focus on a specific causal relationship and expectations about future developments. Within the CAP by linking, for instance, the use of product subsidies and price guarantees to farmers in the EU with a collection of data on agricultural production output over a certain period of time, theoretical ideas may suggest a causal relationship between policy instruments in use and policy output, and predict future developments under certain conditions. It has been suggested that theoretical ideas are increasingly informing decision making on the organizational, national, and European levels, particularly within decision-making environments characterized by uncertainty and complexity (Fischer 1990; Richardson 2006). On the one hand, a situation characterized by uncertainty and a lack of knowledge about, for instance, the problem-solving capacity of a particular policy instrument, may pave the way for the institutionalization of theoretical ideas, which predicate something about future developments. On the other hand, a situation characterized by complexity (involving, for instance, a wide range of sources of, and solutions to, a particular policy problem) may pave the way for the institutionalization of theoretical ideas, which establish a focus on a specific causal relationship, thereby helping to reduce complexity. Theoretical ideas thus aspire to coherence, downplay inconsistencies, and, as a result, become attractive for decision-makers at times and in situations characterized by a high degree of complexity and uncertainty. 1

P edersen (1995) is concerned with various ways in which problems may come into being. However, at the same time, Pedersen and others (Hajer 1995; Rochefort and Cobb 1994; Torfing 2004) also see problems, their sources and solutions as they are identified in a given decision-making context, as particularly illustrative of the ideas embedded in such contexts. In other word, problem conceptions may be seen as ideational symptoms.

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Theoretical ideas are often coined among experts within academia, and public and private research organizations with in-depth theoretical and real world knowledge on a particular area. To be sure, experts are by no means exclusively supplying theoretical ideas, nor are experts only found in research. Yet research and experts will often lay claim to theoretical ideas. The term technostructure has been used to describe a layer of experts both on the level of organizations and the level of national policymaking. Such technostructures – or on the state level: technocorporatism – serve to depoliticize by turning decision making into a planning and coordinating activity based on scientific theories and systematic data rather than on bargaining processes among diverging interests (Fischer 1990). On the international level, policy coordination – as opposed to, for instance, political deliberation – may take place in epistemic communities, which can be seen as particularly, though not exclusively, concerned with theoretical ideas. Epistemic communities are networks of experts that supply ideas to the policy process (Hass 1992). Ideas coined within epistemic communities are based on shared causal beliefs among the network members, and such causal beliefs are based on an analysis of practices, as well as on a shared conception of the processes through which ideas are validated and invalidated. Ideas devised among experts tend, thus, to be assessed in terms of their technical feasibility and implementation capability as opposed to their political viability in a particular context. The predictive, rather than evaluative, nature of theoretical ideas also suggests that such ideas may be particularly prominent in policy formulation and agenda setting (Zito 2001, 599ff; Richardson 2006, 7). Theoretical ideas coined and given momentum by expertise do not, however, necessarily lead to technocratic or bureaucratic politics insulated from the public. It has been suggested that the role of expertise in decision making not only depends on the degree of uncertainty,2 but also the political salience attached to a policy problem (Radaelli 1999, 762ff). Policy problems surrounded by a high degree of uncertainty and, at the same time, attracting public attention may well give rise to decision making involving ideas coined by epistemic communities.

2

ote that the role of expertise in decision making is considered along the lines of low versus high unN certainty, rather than certainty versus uncertainty, which acknowledges—along with the literature, in general—that expertise is particularly prominent in decision-making environments characterized by (degrees of) uncertainty.

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It is suggested here that theoretical ideas have a relatively high susceptibility to change. There are several reasons. First, compared, for instance, to normative ideas (see below), theoretical ideas are more likely to be upset by theoretical and real world developments in the sense that new empirical data and theoretical progress may question previous insights into the link between the two. Second, when theoretical ideas are coined, the criteria for validating and, thus, choosing one idea over another tends to be agreed upon among the agents involved, making the selection and adoption of one idea over another more straightforward than, say, in situations where the selection of ideas essentially depends on ideals of (un)desirable future developments. Third, the agents devising theoretical ideas (i.e., experts) tend to develop a sense of “scientifically based decision methodologies” among themselves, emphasizing technocratic problem solving, value neutrality, and efficient goal-oriented decision making (Fischer 1990, 21). This implies that theoretical ideas are more susceptible to change than ideas evolving in decision-making environments characterized by, for instance, interest-based bargaining. Fourth, the involvement of expertise in decision making is, in itself, based on the conception that the apolitical language of expertise offers a shortcut to efficient policy outputs, while avoiding the more troublesome processes of consensus making and legitimization of political decision-making processes (Fischer 1990). Finally, since theoretical ideas aspire to casual clarity and the elimination of inconsistency, the susceptibility of theoretical ideas must be expected to be higher than, for example, cognitive ideas that are more concerned with comprehensiveness and involve a higher degree complexity.

Normative Ideas Normative ideas are based on ideals about preferred future developments and, like theoretical ideas, predictions of future development. Normative ideas establish a concern about the future; however, as opposed to theoretical ideas, such concerns arise out of ideals about desired or undesired development rather than out of theoretical causal assumptions. Normative ideas may thus be defined as coming into being when predicted developments are linked with ideals about (un)desired developments, and when the insight of this link, in turn, establishes a concern about future developments and, possibly, a need to make a choice (Pedersen 1995). For instance, within the CAP by linking predictions about a further technological modernization of the agricultural sector to 214


ideals holding that public policies should aim to protect against environmental depletion, concerns may be established about the increasing intensification of agricultural production. It has been suggested that normative ideas are either directed at, or found among, the public (Campbell 2004; Schmidt 2002). Along these lines, normative ideas may, on the one hand, be seen as public sentiments that are basic, and often implicit, public assumptions setting-up boundaries for an array of acceptable solutions. On the other hand, normative ideas may be used strategically by decision-makers to frame policies in order to make them acceptable among the public (Campbell 1998). Agency must be expected to be particularly significant regarding the normative framing of policies, and possibly change in normative ideas, since this involves strategic considerations about how to make an idea acceptable. It has been suggested that the type of agency involved in giving momentum to change in normative ideas may be exercised through rhetorical action, including justifications and legitimation of certain ideal developments (Risse 2000). If rhetorical action – or campaigning – is, however, to bring about change in normative ideas, an audience for campaigning (in principle an impressionable one) is implied. In the words of Risse (2000, 8): “If everybody in a communicative situation engages in rhetoric – the speaker, the target, and the audience – they can argue strategically until they are all blue in the face and still not change anyone’s mind.” Even if “the audience” may often be the broader public and “the speakers” are often found in more narrow circles of decision-makers, this line of thinking implies that campaigning may also be exercised among decision-makers. At the same time, the success of campaigning in bringing about change in normative ideas depends on their resonance among the audience, whether within the wider public or the more narrow circles of decision-makers, but also on at least some level of novelty of the ideas advocated: otherwise it would not be a process of change, but rather one of homogenization. The types of agents that may take up the role of campaigners include politicians, spin doctors, political aides, and organized interests (Campbell 2004, 127ff). That normative ideas are based on ideals about (un)desired developments, as well as the strategic use by decision-makers of such ideas in legitimizing policy initiatives, suggests that they are particularly prominent in regard to problem formulations and agenda setting. It is suggested here that normative ideas have a relatively low susceptibility to change. First, compared to analytical ideas (see below), normative ideas are less likely to be upset by real world developments, since such ideas are based 215


on ideals about (un)desired developments rather than on experience. Secondly, even if campaigning is exercised regarding desired developments, normative ideational change is likely to be granted only reluctantly. The reason for this is that “the audience” must, on the one hand, attach some level of novelty to the ideas being campaigned, while on the other, they are expected to already subscribe to certain alternative normative ideas.

Analytical Ideas Analytical ideas are based on experience in the sense that such ideas rise out of a comparison and evaluation of previously envisaged developments against actual developments. A focus on the positive/negative relation between a previously anticipated development and a subsequent actual development is established through analytical ideas. Analytical ideas may thus be defined as the type of ideas that come into being when previously predicted developments are linked with actual developments, and when the insight of this link is turned into some sort of experience about a relation between the two (Pedersen 1995). For instance within the field of the CAP, by evaluating actual developments in agricultural production against previously anticipated developments, experiences may be created about the relationship between the policy instruments in use and policy outcomes. Importantly, even if analytical ideas may, for instance, feed into theoretical predictions, analytical ideas are articulated as experience and stored as learning, and are not themselves predictive. Analytical debates have been suggested as significant sources of learning in political subsystems (Jenkins-Smiths and Sabatier 1993, 45ff). Analytical debates involve conflicts among advocacy coalitions over the scope of a particular policy problem, the sources of the problem and the efficacy of alternative solutions. The outcome of the debates, or whether learning takes place, depends on the introduction of new technical information and evaluations of previous initiatives, which may (or may not) convince the adversaries of new causes of action. Even if the conflicts reflect the existence of diverging norms among advocacy coalitions, the analytical debate is based on scientific evidence and at least some level of shared conception of the range of relevant theories, methods, empirical data, and standards of validation. Analytical debates are often mediated by policy brokers, such as high-ranking governmental officials, who seek to reduce the level of conflict between competing positions and facilitate decisions (Jenkins-Smiths and Sabatier 1993, 27). In this sense, high-ranking 216


government officials may facilitate change in analytical ideas among decisionmakers; however, the nature of analytical ideas also suggests that such ideas are coined among various experts with real world knowledge about a particular policy field, including evaluators, academics, think tanks, and consultants. The evaluative, rather than predictive, nature of analytical ideas also implies that such ideas are particularly prominent in policy implementation, technical feed-back processes (opposed to public feed-back processes) and evaluations. It is suggested here that analytical ideas have a medium susceptibility to change. First, compared, for instance, to normative ideas, analytical ideas are most likely to be upset by real world developments. Second, like theoretical ideas, analytical ideas are coined among agents with at least some degree of shared conception of the processes through which theories and data are validated. For example, when analytical ideas are devised through an analytical debate, the criteria for validating and, thus, choosing one idea above another tend to be agreed upon by the agents involved, making the selection and adoption of one idea above another more straightforward than, say, in situations where the selection of ideas depends on ideals of (un)desired future developments. However, even if analytical ideas – like any type idea – tend to change incrementally, the involvement of knowledge based on evaluations, learning processes, and the generation of experience suggests a more protracted process.

Cognitive Ideas Cognitive ideas have a theoretical, normative, and an analytical dimension, but cognitive ideas are not, as opposed to theoretical and normative ideas, in themselves predictive. They are, rather, based on comprehensive knowledge of the validity of certain theoretical causal assumptions, on experiences stored as learning, and on insights into how desired developments may be pursued strategically through planning. Cognitive ideas create expectations about acceptable political activity but also about how desired developments may be pursued in an efficient manner. Cognitive ideas may thus be defined as the type of ideas that come into being when theoretical causal assumptions are linked with empirical data, when predicted developments are linked with ideal developments, and when predicted developments are evaluated against actual developments (Pedersen 1995). In the case of the CAP of the EU, cognitive ideas may, for instance, involve references to a causal relationship between certain levels of product subsidies and production outcomes, evaluations of past 217


policies, as well as references to how the CAP may work to balance disparities between farmers and regions in the EU. Cognitive ideas are often associated with deep-rooted sets of conceptions or paradigms which are – usually by definition – very reluctant to change. For instance, cognitive ideas may be seen as paradigms that works as background assumptions among the decision-making elites (Campbell 2004, 199ff). Cognitive ideas, as they are defined in the current context, are, however, more closely associated with Campbell’s cognitive programs, which specify policy prescriptions and causes of action. The comprehensiveness of cognitive ideas (i.e., that cognitive ideas are defined as having a theoretical, normative, and analytical dimension) suggests that such ideas are elitist and found among decision-makers rather than among the broader public. While cognitive ideas may well draw on other types of ideas coined among, for instance, experts, academics, or organized interests, cognitive ideas are likely to be particularly prominent among decision-makers, including politicians and high-ranking government officials (Campbell 2004, 127ff). Cognitive ideas may be given momentum by the “logic of arguing,” or political deliberation (Risse 2000, 9–11); however, in opposition to Risse, neither agents nor cognitive ideas are granted any persuasive powers in themselves. Political deliberation is here, rather, seen as the type of agency that gives momentum to change based on claims about theoretical causal relationships, normative claims about the legitimacy of particular causes of action, as well as analytical claims referring to real-world experiences. The nature of cognitive ideas thus implies that such ideas are particularly prominent in regard to formal decision making, where alternatives and specified causes of actions are assessed against each other in terms of legitimacy, desirability, and efficiency. Furthermore, in opposition to Campbell’s conceptualization of cognitive programs, cognitive ideas are defined in terms of their discursive structure rather than in terms of their role in decision making and likeliness of change. Thus, while the discursive structure of cognitive ideas does imply that such ideas are found among decision-making elites, the susceptibility of cognitive ideas is essentially an empirical question. It is suggested here that cognitive ideas have a medium susceptibility to change. On the one hand, change in cognitive ideas involves a generation of data, learning, and evaluation, which suggests a cumbersome and timely process (Hass 2004). On the other hand, cognitive ideas are those most sensitive to real world developments, whether changes in ideals about (un)desired 218


developments, theoretical causal assumptions, or available empirical data. This also implies that change may appear in cognitive ideas in a partial or gradual way. For instance, the normative dimension of cognitive ideas may be subject to change, while the theoretical and analytical dimensions remain constant. In other words, whereas the theoretical causal assumptions and experiences underpinning certain causes of action may remain the same, new ways of legitimizing particular policy initiatives may be introduced and, thus, amount to a partial cognitive change. In comparison to other definitions of ideas, the definitions adopted above have implications as to how we study and theorize the role of ideas in decision making. Regardless of whether ideas may be characterized as theoretical, normative, analytical or cognitive, none of the types discussed are more or less real than others, but rather it is suggested that ideas differ on how they come into being. It should also be clear that, while the suggested typology draws on a range of analytical frameworks and theories on ideas and decision making, ideas are essentially seen and defined in terms of their discursive structure. Cognitive ideas, as defined here, are not particularly readily comparable to, say, the notion of paradigms. They are, however, more readily comparable to Campbell’s cognitive programs and Blyth’s conception of ideas as “blueprints” for institutional change (Blyth 2002, 40–41). The relative susceptibility of cognitive ideas to change may also be counterintuitive for those who see them as entities that are largely concealed from, or at least taken for granted by, the agents involved rather than a discursive phenomenon. Finally, even if some approaches – particularly rational choice institutionalism – tend to make ideas the property of individual or collective agents, ideas, and therefore ideational change, are most often (as in this study) seen as a collective phenomenon. For this reason, the focus is on how types of agency may give momentum to specific types of ideas, and on how these types of agency may be exercised by various individual and collective agents (some of whom are suggested above) at different points in time (see Radaelli 1999, 768ff). Table 7.1 summarizes the definitions, implications, aspirations, and agency of theoretical, normative, analytical, and cognitive ideas, as well as the proposed susceptibility of such types of ideas to change.

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Types of Theoretical ideas ideas

Normative ideas

Analytical ideas

Cognitive ideas

Based on a link between predicted developments and ideals about (un)desired developments

Based on a link between previously predicted developments and actual developments

Based on links between theoretical causal assumptions with empirical data, between predicted and ideal developments, as well as between predicted and actual developments

Implications4 Establish a focus on specific causal relation and create expectations about future developments

Establish a focus on alternatives and create a need to make a choice

Establish a focus Establish a focus on specified causes of on the positive/ negative relation action and output between the predicted and the actual development, and create experience

Aspirations

Coherence and downplay inconsistency

Legitimacy

Evaluation and learning

Comprehensiveness and efficiency

Agency

(Theoretical) Expertise

Campaigning

(Analytical) Expertise

Political deliberation

Low

Medium

Medium

Aspects of ideas Definition3

Based on a link between theoretical causal assumptions and empirical data

High Proposed relative susceptibility to change

Table 8.1. Types of Ideas and their Susceptibility to Change

Ideational Change within the CAP The second objective of this chapter is the empirical analysis of ideational change within the CAP. The period under consideration runs from the early 3 4

Adapted from Pedersen 1995. Adapted from Pedersen 1995.

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1980s to 2005. During this period, some of the most prominent concerns within the CAP had to do with agricultural surplus production, pressures on the budget, and the distribution of public funds among farmer and regions, which – at least initially – arose out of more comprehensive cognitive considerations. From the mid–1980s onwards, normative ideas have increasingly given rise to concerns about environmental depletion, food safety and food quality, and the overall legitimacy of the CAP. In the late 1990s, analytical ideas within the CAP gave rise to concerns about enlargement of the EU, the liberalization of international trade with agricultural products, and the management of the CAP. It appears that these types of ideas have been more or less prominent in different periods of time. Sometimes types of ideas develop in parallel to each other, sometimes they are linked up and mutate into new types, and sometimes they are transformed to such an extent that are rendered qualitatively different. Ideational change is measured beginning from the point when a particular idea has obtained institutional status within the CAP. An idea is considered institutionalised when it has been accepted as meaningful and legitimate (and often linked to formal or informal sanctions) among all the central agents within the CAP, including the Commission, the Commission Services, the Council of Agricultural Ministers, but also the European Parliament (EP). Even though the EP is often considered to be lacking influence on agricultural issues, the EP is included in this analysis since it appears that it has, at certain points and in relation to certain ideas, contributed to change. The susceptibility of ideas to change is assessed on the basis of two measures: 1) on the number of identifiable changes during the period of time under investigation and 2) on more qualitative considerations on the resistance of ideas to change. These qualitative assessments include considerations on ideational resistance to situations characterized by crisis (e.g., budget or food crises). Moreover, the scope of ideational change is assessed. The mutation of ideas, whereby different types of ideas are linked to form qualitatively new ideas, is considered a change of a certain scope. An ideational transformation, whereby one type of idea transforms into another, is considered a change of larger scope. The assessment of the susceptibility of different types of ideas to change is based on a comprehensive analysis of documents central to the development of the CAP. The documents consulted include five reform attempts – in 1984, 1988, 1992, 1999, and 2003 – as well as preparatory documents published both by

221


the Commission and the EP.5 Finally, a number of empirical studies of reforms of the CAP since the early 1980s have been consulted, particularly regarding the exercise of agency.

Changes in Cognitive Ideas within the CAP Cognitive ideas within the CAP giving rise to concerns with agricultural surplus production, budget pressures and the distribution of public funds among farmers and regions in the EU have, since the early 1980s, been subject to changes twice: First in the late 1980s/ early 1990s and then again in the late 1990s. In the early 1980s, ideas giving rise to concerns with agricultural surplus production, budget pressures and the distribution of public support had a theoretical, analytical, and normative dimension. Theoretically, such concerns where based on predictions made as early as the late 1960s, when the Mansholt Plan – named after the presiding Commissioner for Agriculture – anticipated future problems of surplus production based on the causal assumption that a price policy supporting the quantity of agricultural output would encourage farmers to increase production (Europäischen Kommission 1968). Analytically, the concerns were based on evaluations of these predictions against actual developments in production data covering a range of agricultural products throughout the 1970s and early 1980s. Experience indicated that a price policy supporting the quantity of agricultural output would encourage farmers to increase production and lead to problems of surplus production. Normatively, the CAP was also informed by ideas based on a link between, on the one hand, further predicted developments disfavoring certain farmers and agricultural regions in the Community and, on the other hand, the ideal that the CAP should strive towards balancing out such disparities (Commission 1981). By the late 1980s/early 1990s, the failure of past policies, including the limited success of two reform attempts in 1984 and 1988, and developments in agricultural production data and CAP spending, had made problems of surplus production, budget pressure, and the uneven distribution of funds even more evident (Moyer and Josling 2002, 103ff; Patterson 1997, 154). Cognitive ideas forming the background for the 1992 CAP reform appear to have been based on

5

S ee Lynggaard (2006, chapter three) for a detailed description of the methodology used in the study of ideational change within the CAP.

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experiences with the two attempts to reform the CAP in the 1980s. The 1984 CAP reform had shown that, while the production quotas introduced (in milk productions) had a positive effect on limiting surplus production (in milk) and budget costs, this particular policy instrument also worked to hamper innovation in the agricultural sector. Likewise, it was recognized by the Commission that the 1988 CAP reform, which introduced a limit on the production quantities for which farmers would be guaranteed certain prices (and a reduced price if production exceeded these limits), did not solve the problems of surplus production as intended. Finally, not only was it acknowledged that the policy instruments introduced by the two reforms of the 1980s had not been able to consistently solve concerns about agricultural surplus and spending, but the reform attempts had also been met with severe opposition among farmers and their main interest organisation at the EU level – the Confederation of Professional Agricultural Organisations (COPA) (Agra Europe 3.1.1986; 25.1.1991; Moyer and Josling 2002, 103–104; Grant 1997, 75–76; Kay 1998, 102–104). It was, however, also around this time that concerns with surplus production, budget pressure, and the uneven distribution of funds were increasingly formed against the background of normative considerations of the undesired intensification of agricultural production. By the early 1990s, it had become widely accepted that intensive agricultural production was the source, not only of environmental depletion (see below), but also of surplus production and budget pressures. In other words, increasingly intensive agricultural production was appointed and widely accepted as an undesirable development which, if curbed, would work in favor of resolving the most pressing concern within the CAP in the early 1990s: surplus production (Commission 1991). Moreover, concerns with agricultural surplus production had been linked with concerns about environmental depletion, thus further legitimizing initiatives directed at reducing intensive agricultural production. The changes in cognitive ideas that had been institutionalized by the early 1990s and formed the basis for the 1992 CAP reform may be seen, at least in part, as having gained momentum because of political deliberation. The agents exercising political deliberation included the Commission, the Commission Services and, in spite of initial opposition, members of the Agricultural Council. Changes in cognitive ideas in the late 1980s/early 1990s particularly appear, however, to have been initiated by high-ranking officials within the DG (Directorate-General) for Agriculture, with the close involvement of the Commissioner for Agriculture and his personal cabinet (Moyer and Josling 2002, 223


97–98; Kay 1998, 99ff). As someone very aware of the high political salience of reform considerations within the CAP, the Commissioner for Agriculture (Ray MacSharry) established a group of high-ranking officials from the DG for Agriculture which elaborated a radical reform paper without the usual consultation of Member States and organized interests (Coleman and Tangermann 1999, 395; Fouilleux 2004, 241-242). The experience of the 1980s, which had established relationships between certain policy instruments and outcomes, were linked within this group to developments in production and spending data in the early 1990s. As noted by Kay, “MacSharry used to spend time studying tables showing the distribution of the benefits of the CAP at an EU and member state level”(1998, 102). Likewise, the initial report, which subsequently fed into the 1992 CAP reform, was elaborated with only few Head of Divisions within the DG for Agriculture knowing about it, and “drew extensively on data and reports from the commodity divisions” (Kay 1998, 103). Although organized agricultural interests often enjoy privileged access to agricultural decision making, the shaping of the 1992 reform agenda was characterized by the absence, or marginal influence, of such interests both at the EU level and within large EU Member States, including Germany, France, and the U.K. (Kay 1998, 154ff). The success of what became known as the “MacSharry Reform” in 1992, and which is commonly considered the greatest departure from status quo in the history of the CAP, is thus often attributed to the secrecy surrounding the elaboration of the reform proposals and the initial insulation of the high-ranking bureaucrats, political advisors, and Commissioner for Agriculture from outside pressures. In the late 1990s, a central concern within the CAP was whether European agriculture would be able to profit from more liberalized international agricultural markets (Commission 1998). Experiences related to high price policies and insufficient competitiveness were linked to expectations of more liberalized international trade of agricultural products. This, in turn, formed the basis for the articulation of problems that related to the inadequacy of European agriculture to profit from liberalized international agricultural trade. Surplus production and budget pressures were still matters of concern, but at this point such concerns were increasingly articulated as the potential consequence of a lack of international competitiveness in European agriculture. Concerns over surplus production and budget pressures rose, in part, out of undesired developments related to the intensification of agricultural production in the late 1980s/early 1990s, but this had become less of a worry by the late 90s. Instead, 224


concerns increasingly arose out of the negative experiences with the high price policies and increasing international competition within the agricultural sector: transforming cognitive ideas within the CAP in the late 1990s into what may be characterized as analytical ideas.

From Cognitive to Analytical Ideas within the CAP By the late 1990s, the lack of international competitiveness in European agriculture, rather than intensive agricultural production, was seen as a the central source of surplus production and budget pressures. By the late 1990s, experience helped to establish a relationship within the CAP between high price policies and insufficient competitiveness. Linking such experience to expectations of further liberalization of international trade with agricultural products, concerns arose about whether EU agriculture would be able to profit from growth in demand and prices on the world markets. The lack of international competitiveness of EU agriculture further gave rise to concerns related to surpluses of agricultural products, as well as budget pressures within the EU (Commission 1998). More recent concerns about the management and complexity of the CAP may also be seen as arising out of analytical ideas in the late 1990s. Throughout the 90s and 80s, the Community was enlarged to include Greece (in 1981), Portugal and Spain (in 1986), and later, to include Austria, Finland, and Sweden (in 1995). Against this background, the anticipated big bang enlargement, including ten additional central and eastern European countries in the late 1990s, appeared to give rise to concerns over an increasingly bureaucratic and complex CAP. Based on experiences with previous Community expansion, it appeared that a relationship had been established between, one the one hand, enlargement and increased structural diversity in Community agricultural sectors and, on the other, increased administrative complexity (Commission 1998). Together with certain normative ideas (see above) these analytical ideas subsequently formed the basis of not only the 1999, or Agenda 2000, CAP reform (Commission 1999), but also carried through and were reinforced by the 2003, or mid-term review (MTR), CAP reform (Commission 2003). Since the later part of the 1990s, the DG for Agriculture appears to have given momentum to changes in analytical ideas. A number of DGs were involved in the Commission’s proposals for reform, including the DG for Competition, the DG for Regional Policy and Cohesion, and the DG for the 225


Environment; yet the DG for Agriculture was primarily responsible for their elaboration. It also appears that the analytical capabilities of the DG for Agriculture were particularly strengthened throughout the 1990s, in the wake of the 1992 CAP reform. Based on the experiences from the elaboration of the 1992 CAP reform, it had become apparent that the analytical capabilities and expertise of the DG for Agriculture had enabled the exercising of policy entrepreneurship, but also that these capabilities were insufficient. Throughout the 1990s, the DG for Agriculture built up its internal capacity of systematic data collection, economic modelling, as well as political analysis, as an acknowledgement of the need to consider political context and timing when promoting changes. The build-up of analytical capacity was accomplished through certain internal reorganizations, increased financial resources, and a strengthening of research. A number of additional experts, including agri-economists and personnel with knowledge of both the EU and domestic political contexts were taken into service (Fouilleux 2004, 242ff.).6 Most notably, from late 1995 to mid–1996, a think tank was set up by the DG for Agriculture with the task of diagnosing inconsistencies and problems within the CAP. The think tank was to feed into the debate on how to further reform the CAP along the lines of the 1992 CAP reform and, in particular, how a rural development policy could be further integrated into the CAP. It was chaired by a professor of agricultural economics (Alan Buckwell), and included eight additional researchers with expertise in agricultural economics, rural sociology, political economy, as well as environmental economics (Commission 1997). Even if the entirety of the so-called Buckwell report was not immediately turned into Community policy (Agra Europe 6.3.1998), it appears that this think tank coined a number of those analytical ideas, which were latter carried both into the Agenda 2000 reform and the 2003 MTR. This gave rise to concerns about the international competitiveness of EU agriculture and the management of the CAP. It could further be argued that the report also fed into the more normative concerns, which were institutionalized within the CAP in the second part of the 1990s, and had to do with the overall legitimacy of the CAP among the broader public (see below). 6

F ouilleux (2004) is concerned with the entrepreneurship exercised by the Commission and Commission Services in relation to the CAP Mid-Term Review from 2003. Yet, also according to Fouilleux, the capabilities of the Commission and Commission Services enabling entrepreneurship were enhanced and came into effect during the 1990s.

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Changes in Normative Ideas within the CAP Normative ideas within the CAP have given rise, for instance, to concerns about the depletion of the environment, food safety and food quality, as well as concerns over the legitimacy of the CAP within broader public. These ideas have been subject to change since the early 1980s, yet they have also shown at least some degree of resistance over time. In the early 1980s, ideas linking the CAP with environmental concerns were given voice, particularly among groupings within the EP (European Parliament 1981). It was not, however, until the mid–1980s that such concerns became institutionalized as legitimate concerns among all the central agents within the CAP, including the Commission and Commission Services, and among EU member states representatives (Commission 1985). To be sure, variations existed among EP committees, Commissioners, Directorate-Generals, and among EU member states as to the scope and relative importance of environmental problems compared to other concerns within the CAP, and as to who or what was to blame for environmental depletion. Regardless of such variations, environmental concerns were based on ideas that linked up predictions of further modernization of agricultural production and the ideal that the CAP should contribute to the protection of the environment. Even though such normative ideas have been challenged, the challenges have largely been abortive and suggest that normative ideas have a relatively low susceptibility to change. At a 1984 conference on the impact of environmental regulations on the agricultural sector, the European Environmental Bureau (EEB) reflected such challenges when it claimed that the “behavior of national scientific and administrative establishments has not helped to speed up a smooth and rapid implementation of Community environmental policy. Neither should it be forgotten that scientific debate is ongoing and that some politicians take this debate as an alibi for slowing down implementation” (Agra Europe 17.8.1984). Whether used as an alibi or not, the scientific evidence for the existence of a link between modern agricultural production methods and environmental depletion was questioned within the EP Committee on Agriculture in the late mid-1980s. Even if the link could be demonstrated, the severity and scope of the resulting environmental degradation, as well as the availability of efficient Community solutions, was cast in doubt (European Parliament 1986). Regardless of the challenges posed to the availability of scientific evidence, 227


such ideas were upheld. Furthermore, even though normative ideas linking the modernization of agricultural production to the depletion of the environment had obtained an institutionalized status within the CAP by the mid-1980s, the challenges posed appeared at a time when such ideas could be expected to show a higher degree of fragility compared, for instance, to the early 1990s, when environmental concerns within the CAP had been turned into hard regulations and with accompanying legal sanctions. Even as environmental and broader rural development concerns were turned into legislation in the early 1990s, such matters were still seen as essentially normative and did not appear to be subject to systematic and comprehensive effect analysis. Even if the severity and scope of environmental depletion could well be argued against the background of statistical data, detailed assessments of the actual impact of the introduction of environmental regulations on the environment appeared to be absent. Rather, it has been suggested that the linking of such normative concerns to the CAP was used strategically by the Commission to legitimise the 1992 CAP reform among top politicians outside the traditional narrow circles of agricultural decision-makers (e.g., Heads of State and Ministers for Finance) and among the broader public (Moyer and Josling 2002, 112). While preparing the CAP reform in the early 1990s, Ray MacSharry stated that “any meaningful rural development policy must take account of environmental aspects. With the growing public awareness of the environment I will be urging member states to introduce effective programs and am confident of a good response” (Agra Europe 27.7.1990). Around this period, Commission polls also showed that environmental issues where among the most important – topped only by unemployment issues – among EU citizens (Agra Europe 22.3.1991). The ideal that the CAP should obtain its legitimacy among the broader public was central to changes in normative ideas within the CAP in the second half of the 1990s. The rising concerns over the legitimacy of the CAP in the second half of the 1990s may be characterized as normative in the sense that they were based on a link between a predicted further inadequacy of the CAP to resolve problems in agriculture and the ideal that the CAP needed to obtain its legitimacy in the wider public. Even though the CAP was still expected to address a number of concerns related to the environment and the distribution of support among farmers and regions, such issues had, by the late 1990s, been linked with more recent institutionalized concerns regarding food safety and food quality, and were seen, essentially, as the source of problems related to the legitimacy of the 228


CAP (Commission 1998). That is, even though food quality had been articulated as a matter of concern in the early 1980s among groups within the EP, it was not until the late 1990s that food quality had been institutionalized as a concern among all of the central agents within the CAP (Roederer-Rynning 2003; Lynggaard 2006). Particularly illustrative of the institutionalization of the ideal that the CAP should obtain its legitimacy in the wider public, is the actual conduct of annual opinion polls since 2000 concerned with, for instance, the perceived legitimacy of the CAP and what EU citizens consider as the most important objectives of the CAP (e.g. Commission 2000; 2005). Change in normative ideas within the CAP in the late 1990s appeared most notably against the backdrop of a series of food safety crises, in particular the BSE crisis that culminated first in 1996 and then resurfaced around 2000/2001. The BSE crisis was exploited by groups within the EP, including the EP Committee for the Environment, in order to give momentum to consumer-oriented issues within the CAP, and to include civil society groups in ways other than though public hearings (Roederer-Rynning 2003). As groups within the EP had given momentum to the institutionalization of normative ideas concerned with environmental depletion in the early 1980s (Lynggaard 2007), groupings within the EP appear to have contributed to change in normative ideas in the second half of the 1990s.

Changes in Theoretical Ideas within the CAP Existing empirical insights does not supply any evidence of clear-cut theoretical ideas informing the CAP. There may be several reasons for this: First, the CAP may not be informed by theoretical ideas. Second, theoretical ideas devised by experts and academics tend to be articulated differently among decision-makers. What is first introduced as a theoretical idea among experts and academics may, when adopted by decision-makers, become articulated and instituted as (a) a normative idea, thereby creating the need to make a choice, as (b) an analytical idea in order to enhance experience, or as (c) a cognitive idea in order to specify a certain course of action. For instance, ideas forming the background for concerns with agricultural surplus production, budget pressures, and the unjust distribution of support among farmers and regions in the late 1980s/early 1990s were cognitively instituted and given momentum by the Commissioner for Agriculture and his reform team. It is, however, arguable that the theoretical ideas drawn upon to support specific theoretical 229


causal relationships between various agricultural policy instruments and policy outcomes “had existed in agricultural policy circles and academia for almost twenty years” (Kay 1998, 102). Supporting this explanation is the suggestion that supranational entrepreneurs can give momentum to ideas coined among experts by advocating particular interpretations (Radaelli 1999) and that such types of ideas may also be subject to transformation as they are articulated and institutionalized among decision-makers.

Conclusions This chapter began with the premise that, in order to enhance our insight into the role of ideas in decision making, it may be worthwhile to differentiate types of ideas. It is proposed here that the literature hints at four types of ideas: theoretical, normative, analytical, and cognitive. Each type of idea has been defined and described in terms of its implications, aspirations, and the agency involved. It is further suggested that different ideas may vary as to their susceptibility to change. Clearly, the conclusions reached regarding theoretical ideas and their susceptibility to change are preliminary, since this study lacks necessary empirical insight. Further empirical investigation directed at ideas coined among experts and academics, and the translation of such ideas among decision-makers is needed. Studies of the role of epistemic communities have begun this work, yet little is known about whether or how types of ideas may change in the process. With this in mind, the present investigation suggests several ideational shifts. First, cognitive ideas giving rise to concerns related to surplus production and budget pressures have been subject to change twice since the early 1980s. Changes in cognitive ideas in the late 1980s/early 1990s appear to have been given momentum by political deliberation, which included claims of theoretical causal relationships between price policies and production output, normative claims emphasizing the legitimate choice in favor of environmental protection, and analytical claims based on experience and generated though evaluations of previous policies and policy outcomes. Political deliberation was exercised particularly by high-ranking officials and policy advisors within in the Commission and Commission Services, and it is important to note that this was done with at least some degree of insulation from outside pressures. Change in cognitive ideas in the late 1990s may be characterized as amounting to a transformation of cognitive ideas into analytical ideas. The point is 230


not to suggest a general, or in any terms fully fledged, shift toward what has been conceptualized as a “competitive agriculture paradigm” (as opposed to a “dependent agriculture paradigm” or “multifunctional agriculture paradigm”) (Moyer and Josling 2002, chapter 3). Rather it is suggested that ideational change had occurred by the late 1990s, which created expectations in favor of a CAP more oriented towards making European agriculture more internationally competitive while, at the same time, acknowledging other different and even conflicting ideational changes within the CAP. Second, although subject to change pressures when normative ideas within the CAP may arguably have been particularly fragile, such ideas have shown at least some degree of resistance. Normative ideational change did, however, take place in the latter part of the 1990s and it appears that politicians within the EP contributed to these changes. Even though normative ideas within the CAP giving rise, for instance, to concerns over environmental depletion have been subject to pressures, such ideas have been relatively stable at least since the mid-1980s. It was not until the late 1990s that certain changes took place, including an increased prominence given to concerns related to food safety and quality, as well as the overall legitimacy of the CAP. Third, regarding the susceptibility of analytical ideas to change, this study recounts the process whereby previously cognitive ideas were transformed, by the late 1990s, into analytical ideas. It appears that enhanced in-house expertise enabled the Commission Services to contribute to these changes. Another and largely separate set of analytical ideas had, by the late 1990s, established a relationship between Community enlargement and administrative complexity. Even if it is not possible to quantify change, the empirical investigation suggests that analytical ideas have been subject to change, and that the momentum has been given by analytical expertise. Both agents of cognitive ideational change in the late 1980s/early 1990s and agents of analytical ideational change in the late 1990s are found within the Commission and the Commission Services; however, even if the agents of cognitive ideational change were highly politically skilled (see Kay 1998, 99ff), it also appears that the in-house expertise and analytical skills of the Commission Services had been enhanced by the late 1990s, based on experience with previous CAP reforms. The empirical analysis suggests that cognitive ideas are more susceptible to change than normative ideas, yet the study lacks empirical evidence which would allow an assessment of the relative susceptibility to change of cognitive and normative ideas vis-à-vis theoretical and analytical ideas (cf. table 7.1). 231


Finally, this paper also gives rise a number of pressing – and not easily answered – questions. If we suspect that 1) it is possible to differentiate between theoretical, normative, analytical, and cognitive ideas and 2) that types of ideas may vary as to their susceptibility to change, sensitive measurements and explanations of different ideas’ susceptibility to change need to be further developed. Essentially, the question of how different types of ideas relate to types of institutional change needs to be addressed. This paper provides an explorative starting point.

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Chapter 9

The Process of Legitimation By Eva Boxenbaum

Introduction How are novel ideas introduced into mature organizational fields? The institutional literature tends to suggest that a jolt, in the form of a major event, destabilizes the organizational field, which then becomes receptive to novel or diffusing ideas. This literature also holds, however, that cognition is fairly resistent to change and that new ideas are unlikely to challenge institutionalized beliefs, even if the field is destabilized. On occasion, new ideas do succeed in penetrating institutional walls, resulting in social movements and institutional change. The intriguing question that this chapter addresses is how new ideas gain enough legitimacy to challenge institutionalized beliefs in a mature organizational field. Legitimacy refers to the congruence between the values that inform organizational activities and the widely accepted norms in the larger social system (Dowling and Pfeffer 1975; Suchman 1995). An idea is legitimate if it resonates with the institutional order and widespread beliefs in the organizational field. An idea is not simply legitimate or illegitimate; it can be slightly legitimate, somewhat legitimate, or highly legitimate. Not only is legitimacy a continuous construct, it is also a multidimensional one. An idea can have sociopolitical, pragmatic, moral, or cognitive legitimacy, depending on the typology evoked (see Rao 1994; Suchman, 1995). Rao (1994, 30) identifies two types of legitimacy: sociopolitical and cognitive. Sociopolitical legitimacy consists of endorsement by legal authorities, governmental bodies, and other powerful organizations. Cognitive legitimacy is the framing of an organization as desirable, proper, and appropriate within a widely shared system of norms


and values. In practice, there is much overlap between these two types of legitimacy. If a practice enjoys cognitive legitimacy, then it increases the likelihood that legal authorities and governmental bodies will adopt and endorse it (Greenwood, Suddaby, and Hinings 2002). Likewise, if a politically powerful organization assigns sociopolitical legitimacy to a practice, then other actors are more likely to regard it as legitimate and attempt to integrate it into the widely shared system of norms and values (Thornton and Ocasio 1999). The different dimensions of legitimacy are interrelated, but it is important to distinguish among them for analytical purposes (Suchman 1995). Finally, there are different mechanisms for gaining, maintaining, and restoring legitimacy, which also need to be distinguished from one another (Suchman 1995). My objective is to illuminate the process of gaining cognitive legitimacy. Although many components of legitimation have already been identified, the process remains poorly comprehended. After carefully reviewing the literature on legitimacy, Suchman calls for more empirical research on the process: Because we lack studies that address the full range of legitimation techniques, we currently can say very little about the nature (or even the existence) of ‘typical’ legitimation progressions. Do organizations employ limited repertoires of techniques in relatively fixed sequences? Does the sequencing of legitimation efforts affect the ultimate success of a legitimation project? Can certain legitimation progressions become institutionalized and meaning laden? All of these questions remain unanswered, yet all merit close empirical attention (1995, 602–3). In fact, a number of studies addresses legitimation techniques. The problem is not that we lack studies on this topic, but that the studies use inadequate methods. Archival sources, textual data, and retrospective interviews from case studies that were selected on the dependent variable are not sufficient data sources for studying legitimation processes; yet they are, by far, the most commonly used in previous studies. These data sources tell us little about what actors think, what they say, and what they do when they engage in legitimation. They inform us what actors say about their strategic role after the fact, and they show which discourses were linked, and how they were linked, in the written output. But which alternatives did the actors consider at the time? How did they choose? We need to get in the field to observe what is happening, at the time that it is happening, and ask the actors about their ideas and actions as 238

The Process of Legitimation

they are occurring. Otherwise, insight into legitimation processes is likely to remain stylized and speculative, reflecting a priori convictions about actors’ ability to strategize deliberately in the institutional realm. This chapter is based on empirical data collected in real time and thus avoids the common problem of sampling on the dependent variable (Aldrich and Fiol 1994) while enhancing our understanding of the legitimation process. The empirical study analyzes the legitimation of socially responsible investment (SRI) in Quebec. SRI is an American idea that stipulates that financial investments can generate financial gains and social gains at the same time. These two goals are seen as complementary, even synergetic. Efforts made to legitimize SRI in Quebec in 2003 were met with the suspicion that SRI was a disguised form of liberal capitalism; a new symbolic Anglo-Saxon invasion of Quebec. This chapter examines the process through which a group of actors legitimized socially responsible investment at the center of the field. The legitimation process involved framing in three different dimensions: individual preferences, strategic reframing, and local grounding. These three dimensions are explained and illustrated in the following text, but first, the analysis needs to be positioned theoretically and methodologically.

Cognitive Legitimacy Cognitive legitimacy occurs when an idea corresponds to taken-for-granted beliefs that render it desirable, proper, and appropriate within a widely shared system of norms and values (Zucker 1986; Scott 1987; Rao 1994; Suchman 1995). Novel ideas are not born with cognitive legitimacy; they acquire it. Even genuinely novel ideas that revolutionized our understandings had to be legitimated when they were first introduced. Take electrical light, for instance. Electrical light was met with indifference when Edison first introduced it (Hargadon and Douglas 2001). People could not make sense of it, so they discarded the idea. Lack of sense-making led to sense-giving (Gioia and Chittipeddi 1991) as Edison reformulated his invention in familiar concepts and embedded it in existing practices relating to the gas lamp. When the invention came to make sense to people, it required cognitive legitimacy and became diffused. Similarly, Kodak actively embedded the roll-film camera in mainstream discourse and institutionalized practices to have it recognized as a relevant and useful aspect of social life (Munir and Phillips 2005, 1672). Active legitimation was thus required in both cases to give sense to what initially seemed like nonsense. 239


The necessity of legitimizing a novel idea is probably as pronounced, if not more so, when the novel idea is an organizational practice instead of a technology. Take as an example the import of best practices. If a foreign best practice conflicts with taken-for-granted beliefs in the field, it is likely to be rejected as illegitimate. This is what happened when the French government tried to implement an adapted version of the Danish flexicurity model in spring 2006. Large segments of the population, not least the youth and the unions, regarded it as illegitimate and effectively blocked implementation. There are also examples of illegitimate practices that have been successfully legitimized (Boxenbaum 2006; Campbell 2004; Djelic 1998; Lippi 2000). Efforts have been made to identify the components involved in gaining cognitive legitimacy. One component, which is widely recognized in the literature, is the combination with legitimate local practices. In combining the novel idea with a local practice, actors leverage the legitimacy of the local practice. Another component is discursive strategy (i.e., persuading listeners that a novel idea has merit). People may superficially accept a novel idea and consider it pragmatic, virtuous, or politically correct, but they are generally reluctant to adopt a novel idea as a deeply held conviction. A novel idea can be made to conform to pre-existing beliefs (Suchman 1995, 587). For instance, a director of a Mexican company drew on broad discourses of Communist ideology, and more recent discourses of economic realities, to produce a legitimating narrative of organizational change that appealed to other managers, workers, and broader stakeholders (De Holan and Phillips 2002, 80). Discursive strategy can also mobilize new supporters through association with an attractive social identity (Suchman 1995, 587). New constituents are more likely to adopt a novel idea if the adoption positions them as superior or good persons. Legitimation thus transforms what it means to support or oppose an idea (Creed et al. 2002, 494). Discursive strategy creates new legitimating beliefs, as well (Suchman 1995, 587). If a new belief comes into conflict with existing beliefs, then legitimation requires partial dismantling of existing beliefs. For instance, photography was initially believed to be so complex as to be inaccessible to the layperson. This belief had to be dismantled before the Kodak camera could succeed (Munir and Phillips 2005, 1674). The dismantling of existing beliefs is a political process (Rao 1998) where actors risk severing the branch they are sitting on. When actors promote a belief that contradicts existing beliefs, they engage in an act of deinstitutinalization; they challenge the institutions to which they owe their own autonomy and legitimacy (DiMaggio 1988, 13). In 240


the battle for change, they may lose their social position in the field. Empirical evidence shows that legitimation and deinstitutinalization are closely connected (Rao 1998), but the process of co-evolution remains poorly comprehended (Scott 1995, 147; Rao 1998, 921). A better understanding of legitimation processes may help fill this gap.

Social Movements and Frames In recent years, many institutionalists have turned to social movement theory to better understand institutional change processes (Clemens 1997; Rao 1998; Strang and Soule 1998). Recent social movement research gives attention to cultural frames, meaning and identity, and it illuminates cognitive and sociopolitical dimensions of institutional change processes (Rao 1994). One interesting proposition is that skillful entrepreneurs employ frames as mobilization devices (Swidler 1986; Biggart 1989; Snow and Benford 1992). Frames are cognitive lenses (i.e., internally coherent interpretative schemes that give meaning to experiences and behavior) (Goffman 1974; Gamson 1992). Individuals perceive and interpret the world through these interpretive schemes (Snow, Rochford, Worden, and Benford 1986, 464; Goffman 1974, 21) and tend to act in accordance with them. Frames are powerful in the way they assert unobtrusive influence over people’s perceptions, cognitions, and preferences. Frames have the power to make people accept their role without discussion because they see it as natural and because they imagine no alternatives (Lukes 1974). Social movement scholars suggest that frames can be intentionally crafted to mobilize support for a social movement (Snow et al. 1986; Snow and Benford 1988). Frames are crafted and deployed with a specific goal in mind and they can deliberately be made to resonate with shared beliefs and experiences of potential supporters (Gamson 1992; Creed et al. 2002, 480). For instance, strategic framing may be used to mobilize elite sponsorship (McAdam et al. 1996; Tarrow 1989) or to legitimize new ideas (McAdam, McCarthy, and Zald 1988). Strategic framing can be accomplished through frame alignment, which is the act of extending frames or linking previously unconnected frames to one another (Snow et al. 1986). Actors align frames when they make their interpretations, activities, goals, and ideologies appear congruent with the beliefs and values of those they wish to mobilize. In one case study, actors disarmed opposition to direct-selling organizations by successfully connecting two frames 241


that were previously unconnected, namely the logics of the family and the marketplace (Biggart 1989). In another case study, actors gained organizational legitimacy by combining frames from industrial standard-setting and home economics, and by aligning themselves with professionalization efforts (Rao 1998). In both cases, strategic frame alignment helped secure legitimacy for new organizational forms. Unfortunately, insight from social movement theory cannot be directly imported into institutional theory because it construes actors as relatively free of institutional constraints. They can supposedly strategize deliberately in the institutional sphere, using techniques such as frame alignment and story telling (Suchman 1995). Institutional theory construes actors as institutionally embedded, meaning that they are limited in their ability to distance themselves from institutionalized frames. They are, therefore, restricted in their ability to recognize and manipulate institutionalized frames. On the one hand, actors rarely do manipulate others to believe or value something that they do not believe or value themselves (Suchman 1995). On the other hand, stakeholder exposure enables actors to engage in strategic framing (Fiss and Zajac 2006). Obviously, neither extreme position is true: actors have some strategic agency and they are somewhat embedded in institutions. The question is one of degree. Empirical examination is needed to identify how frames are used in practice, most importantly which frames are available to actors who engage in legitimation, and how they select among them to accomplish their goal.

Analytical Procedures A case study was conducted in real time to investigate how actors at the center of an organizational field proceeded to legitimize a new frame: Socially Responsible Investment (SRI). As mentioned previously, SRI refers to a set of practices whose aim is to generate high return on investment while simultaneously pursuing social gains. Investment decisions are made on the basis of financial and social/environmental indicators. For instance, companies that profit from selling environmentally friendly products, or from employing individuals with a marginalized status on the labor market, constitute interesting investment opportunities. The practice of SRI rests on a firm belief in the potential synergy between financial and social/environmental goals. It is assumed that these two goals may overlap – not that they necessarily do – and the aim is to invest in this overlap. There is a fundamental belief that the market can 242


self-regulate, that governmental intervention is not required to assure healthy and ethical socioeconomic development.

The Case The provincial parliament of Quebec published a discussion paper on Corporate Social Responsibility and SRI in 2002 (Committee of Public Finance, 2002). It held a public hearing later that year to explore the value and relevance of these concepts to Quebec. One year later, the first SRI fund was launched. Its mission was to invest in small and medium sized enterprises (SME) in Quebec that foster sustainable development. More specifically, it invested in SMEs that develop, use, or distribute environmentally friendly technologies in Quebec. The SRI fund was sponsored by three organizations, all of which were centrally located in the organizational field. There were two private firms that invested the pension funds of workers associated with two of the largest labor unions in Quebec. Unions play an important role in the Quebec Model, which made these two firms central players in the field. The third organization was an environmental NGO that was charged with distributing public funds to local entrepreneurs that help protect the environment. The NGO represented civil society and local entrepreneurs, which are both important players in Quebec, and hence central actors in the field. Collectively, these three sponsors represent a broad coalition of central actors in the mature field of Quebec.

Data Sources Data was collected from the time of the public hearing in fall 2002 until the launch of the SRI fund in spring 2003. It was a period characterized by negotiations within and among the three organizations and their constituents. The negotiations revolved around the pertinence of launching a SRI fund, its mission, success criteria, legal foundation, and financial arrangements. Data from this period were ethnographic observations, including the public hearing, organizational meetings, and informal encounters with key participants in the legitimation process. Upon the public announcement of the SRI fund, representatives from the three partner organizations met with the CEO of the SRI fund to discuss implementation. I conducted nonparticipant observation of these group meetings, during which legitimation was discussed. I also inter243


viewed ten project participants about their perceptions and motivations related to this project. They requested, and were granted, anonymity due to the policial nature of the project. Therefore, I use only generic terms to identify individuals and organizations. The anonymity, in combination with the reflexive, open and articulate stance of interviewees made for high-quality data. Interview data are, however, naturally limited to what interviewees are, or become, aware of during the interview. It is also limited to what they consider relevant to the context, and are willing to express to the interviewer. To minimize these limitations, I established good rapport with interviewees and compared interview data to other data sources, including written materials from the sponsor organizations, newspaper databases, and online governmental archives.

Data Analysis Data analysis consisted in identifying frames within the data material. I grouped concepts that informants introduced as being naturally associated with one another. For instance, Anglophones, oppression, liberal market economy, Canada, and capitalism were consistently linked to one another and considered illegitimate (see results section). Similarly, Quebecois, social economy, sustainable development, solidarity, liberation, autonomy, and empowerment co-occurred across data sources, and were regarded as legitimate concepts. The American origins of SRI made it illegitimate and therefore in need of legitimation. The second step of data analysis was to identify how actors engaged creatively with the different frames to make SRI gain cognitive legitimacy. I used open coding to identify different dimensions of this legitimation process. Not all actors participated equally in the process of creative reframing, some were more strategic and articulate than others. Open coding generated three dimensions of the legitimation process, namely individual preference, strategic reframing, and local grounding, each of which captures an important element in the process of gaining legitimacy and will be discussed at length in a later section.

Results The Mature Field of Quebec The organizational field of Quebec is characterized by an institutional structure that is fairly distinct from the rest of Canada. Canadian provinces, Quebec included, exercise considerable autonomy in the allocation of transfers 244


from the federal government. The transfers must be used for specific purposes, such as health, education, and social security, and they must be administered in accordance with certain principles (e.g., private hospitals are prohibited). Within these broad parameters, each provincial government designs its own solutions to the problems that they identity. Quebec has used this freedom to develop an institutional structure that differs from that of other provinces. The province has secured rights to institutional autonomy (e.g., the right to select its own immigrants within a preset quota) above and beyond that of other provinces. During the 1995 referendum, Quebec came very close to voting for full independence. The Quebec Model is a cornerstone of Quebec’s institutional structure. This model consists of a tri-party governance structure in which local entrepreneurial firms, labor unions, and civil society foster socioeconomic development in close collaboration. It represents an alternative to liberal capitalism. Conceived in the wake of the Cold War, the model took inspiration from communist initiatives in Cuba and Italy: It was all about workers taking control of economic power. I think that our model at the time was inspired by the Cuban model (i.e., nationalization of economic enterprise and strong worker control over various councils in the firm). A thinker that inspired us very much was Gramsci, one of the founders of the Italian Communist Party. He created the first councils within Italian firms to foster self-governance. We took interest in self-governance, more so than in the Marxist-Leninist tradition where the party was present everywhere (CFO, investment firm). The Quebec model was not just an alternative governance model, it became a powerful symbol of Quebecois identity. During industrialization in the first half of the twentieth century, large segments of the Francophone population of Quebec found employment as unskilled workers in factories that were owned and managed by the Anglophone community. Many Francophones speak of this period with resentment, recalling it as a period of oppression and exploitation. Amplified by historical events of a similar nature, this situation mobilized Francophones to pursue liberation from Anglo-Saxon oppression in the 1960s. The negative sentiments they harbored towards the liberal market economy were channelled into a social movement, known as the “Quiet Revolution,” which empowered Francophones to take charge of Quebec’s economy and 245


pursue institutional autonomy from Canada. One informant captures the collective sentiments in the following words: The reality of this country [Quebec] is that no Francophones had power. Nor money, for that matter. There were priests, notaries, doctors and liberal professions who did, but the rest of us did not touch money. They were dirty. They served to exploit others. I felt that way myself when I was ten years old and wanted to be a communist. Now, at thirty-eight, I tell myself I want to take charge of money myself (CEO, SRI fund). The Quebec Model became a symbol of Francophone empowerment, anticapitalism, and the pursuit of a better society by the Quebecois people for the Quebecois people (Lévesque 2004). It also served as the cornerstone for building an institutional structure that would be independent and radically different from that of Anglophone Canada. In the words of another informant: Quebec was a dependent economy. The most important economic powers were external to Quebec, particularly the financial power. Then, in the 1960s and 1970s, we developed new powers, [through financial institutions] such as la Caisse de dépôt et de placement, la SGF, etc. It took many years, though, before these new institutions gained prominence and developed financial expertise, etc. We also did not have many managers at first (CFO, investment firm). Today, forty years after the Quiet Revolution, the organizational field of Quebec has matured. The Quebec Model has been consolidated and is now deeply embedded in the institutional structure of Quebec. It remains a symbol of the values and the taken-for-granted beliefs that are associated with Quebecois identity, and is manifest as a quest for democratic governance, autonomy, and protection of the French language. Negative sentiments toward liberal market economies are still widespread, and it is common to express negative sentiments towards capitalism and Anglophones.

The Need for Legitimation SRI carries a double objective of financial and social gains; it is expected that synergy can be found between them. The previous account of the organizational field of Quebec showed that this belief is not widely shared by the Quebecois 246


population. Historical experiences of cultural oppression, economic dependency, and communist inspiration have conditioned the Quebecois population to counterpoise financial gains and social gains. They constitute a zero-sum game, or they mutually exclude each other: You know, we always have to weigh financial and social gains against each other. We need to be economically responsible, but we also need to be socially responsible. And it is always one or the other. It is never both at the same time (Director, partner organization). The belief that these two objectives are mutually exclusive is widespread in the population and all the more pronounced among central actors in the field. The central actors are the entrepreneurial firms, unions, and civil society that make up the three pillars of the Quebec Model. Their identity is closely tied to the Quiet Revolution, and they share a belief in the inherent opposition between financial and social gains. They value social gains over financial gains, and tend to view Anglo-Saxon models as illegitimate, as obstacles to gaining institutional autonomy from Canada.

The Legitimation Process The following section presents the key findings, namely the three dimensions of the legitimation process. Each dimension is presented separately with illustrations from the case material. The three dimensions had some stepwise progression, but the process was not a linear one. Actors struggled to make the new frame correspond to all three levels on an on-going basis.

Individual Preference Individual preference refers to the elements of a new frame that provoke a personal response, either positive or negative. A positive response is when an individual is attracted to the frame, or to aspects of it, and positively mobilized to act in accordance with the beliefs and values that it conveys. The response is negative if the individual responds to elements of the frame with indignation, fear, or strong disbelief. If the response is neutral, then there is no individual preference, and the individual is unlikely to engage with the frame. Institutions influence individual preferences and make some responses more common than 247


others in a particular organizational field; however, individuals also have personal experiences and trajectories that shape their perceptions and responses. For instance, a financial executive officer in an investment company is more likely to respond positively to the notion of financial gains than would an environmentalist in an NGO. Actors who engage in legitimation will generally have a positive response to the frame in question. They want to legitimize it, and their attraction to it is the mobilizing force that drives the act of legitimation. They also perceive a need to legitimize the frame, perhaps because the organizational field responds negatively to it. Since their attraction is the mobilizing force, it is important to know what attracts each legitimizing actor to the frame. If they can align their attraction, perhaps they can convince other actors of the frame’s benefits, as well. In the case study, there was some variation in individual preferences (i.e., which dimensions of the SRI frame appealed most to different actors). Their responses varied according to position or profession, professional trajectory, family background, and organizational membership. For instance, some actors were very interested in environmental issues while others were most concerned with democracy in the workplace. Common to them all was a positive response to the element of social gains, particularly those social gains that were aligned with values and objectives that had been dominant in the organizational field for decades. Financial gains were construed as pragmatic means to that end. Two overlapping themes were frequent across individual accounts. One theme was the pragmatic pursuit of social revolution, the other theme was empowerment of local communities. With regards to social revolution, several actors saw SRI as a realistic way to build a better society with a more humane approach to economic production. SRI reflected their political convictions and represented a natural extension of longstanding commitments to socialism, unions, and Quebec independence. For one actor, SRI was a pragmatic way to attain goals that she had had for decades: When I worked in a Canadian company, I got quite involved in union work and leftwing politics. I belonged to the extreme leftwing party called L’independence socialiste du Quebec. The party was all about social revolution. There weren’t that many concrete and pragmatic proposals for how to accomplish it. That is what has changed. My values are still the same, but now I am more aware of the fact that if you want to change something, you 248


have to make proposals that make concrete reference to real life (CFO, investment firm). This longstanding commitment to unions and social revolution was common to most of the legitimizing actors. Some got involved in their youth, others grew up with the ideas at home: I grew up in a family with a father who was entrepreneur and also engaged in the union. He favored the cooperative model of development, the concern with direct democracy and transparency. So the values of cooperation, mutual aid, and economic democracy have been part of my universe since childhood. As a student, I got involved in unions and then I worked for several organizations associated with the union movement in Quebec. I got quite engaged in union activities and took an interest in the protection of consumer rights and in the development of an alternative, more human economy (CEO, investment firm). It is not surprising that individual preferences often revolved around union involvement. The investment firms were directly associated with unions, and most of their employees had previous union experience. Nevertheless, it is interesting that union engagement is closely linked to social revolution, and that unions are a driving force to legitimize SRI. The other theme of attraction to SRI was empowerment of local communities. Many legitimizing actors saw SRI as an opportunity to make local communities and community organizations autonomous from external financing. The CEO of a newly established SRI fund was attracted to the SRI concept for this reason. As former CEO of an environmental NGO that co-sponsored the SRI fund, she wanted to make the environmental NGO independent of external funding: When this project [the SRI fund] starts to make money, the part of that money that belongs to the environmental organization will be reinvested in environmental groups and educational projects. The money we generate will sustain the survival of the environmental organization (CEO, SRI fund).

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Another actor also expressed an individual preference for the empowerment of local communities. He saw SRI as an opportunity to help local communities acquire sufficient skills and resources to take charge of their own destiny: I am in favor of another world order, one in which communities become masters of their own development, not simply engines of profit making for some shareholders. We are in a logic of economic development that is at the service of humans, not the other way around. My objective is to give people and communities the means and the skills that enable them to make informed choices (Director, partner organization). SRI was attractive because it made social empowerment possible through financial gains. This social empowerment agenda is largely identical to the one that drove the Quiet Revolution forward, namely to enable an economically dependent community (Francophone Quebec) to determine its own destiny. Again, the attraction to SRI aligned with social gains that had been on top of the Quebec agenda for decades, and SRI seemed promising as a pragmatic means to that end. The two themes, social revolution and empowerment, that attracted legitimizing actors to the SRI frame represent one dimension of the legitimation process. This dimension of individual preference was a necessary, but certainly not a sufficient, condition for legitimizing a frame that appeared illegitimate to other actors at the center of the organizational field.

Strategic Reframing Another dimension of the legitimation process is strategic reframing. Strategic reframing was important to mobilize political and financial support to formally launch the SRI fund. Frequent discussions took place in private between key stakeholders at the center of the organizational field. The CEO of the SRI fund engaged in politically charged encounters with government officials, CEOs of the two investment firms, presidents of the associated unions, board members of the environmental NGO, and other environmentalist stakeholders. Each of these constituents could block the initiative if they found the SRI project to be misaligned with their personal interests and their organizational missions; hence, the task was one of building consensus and shaping SRI into a form that aligned with the strategic orientation of those actors at the center 250


of the field. Most of these private discussions unfolded over a period of one year and many of them preceded formal group meetings with representatives from the three sponsor organizations of the SRI fund. During group meetings, actors debated how to frame SRI so that it would appeal to key constituents of the three sponsor organizations and to their respective stakeholders, which included the provincial government, two large labor unions, and environmentalists. These constituents were not aligned with one another: The new fund will never hide that it is here to make money. That is, it operates according to a logic of investment. In contrast, the government-funded NGO draws on a logic of social development, which I think is a slightly different mission. The demands are not the same, and the expectations are also different (CEO, SRI fund). The challenge was, therefore, to strategically reframe SRI so it appealed to all key constituents. One adopted strategy was to use other organizational fields as leverage to gain legitimacy locally. Europe, France in particular, carries high legitimacy in Quebec, where it represents a powerful antidote to American liberalism. Social approaches to economic organization are well established in Europe, which testify to the fact that there are viable alternatives to American liberalism. A strong link between SRI and Europe made SRI more legitimate in Quebec. The following represents an example of a European tradition that actors connected to SRI: In France, and elsewhere in Europe, there is the notion of a solidarity economy. It emerged in the late 1970s and early 1980s, where it became part of the socialist party’s platform for social transformation. In 1981, when the left came on stage, there was an impression that France was undergoing profound social transformation, a bit like 1976 in Quebec when the Parti Quebecois and René Lévesque took power (Director, partner organization). The legitimizing actors made links not only to historical events but also to recent examples of SRI expansion in Europe. During meetings, they made mention of SRI initiatives within the European Commission, social responsibility legislation in United Kingdom and France, and French union engagement in SRI activities (observational notes). This testimony to the presence of SRI in 251


Europe made SRI appear more legitimate in the eyes of central actors in the organizational field of Quebec. Another adopted strategy was to connect SRI to sustainable development. The CEO of the SRI fund had attended the World Summit on the Environment, held in Johannesburg in August 2002. She, and many others, took much inspiration from the Summit in the year that followed, and new initiatives on sustainable development emerged in parallel to the SRI fund. Sustainable development was already a familiar and legitimate, if somewhat diffuse, concept in Quebec. It received increased media coverage in 2002–2003 because of the Summit, but also because the Canadian government was hesitating on the ratification of the Kyoto Protocol. The Quebecois media debate about ratification symbolically pitted Anglo-Saxon liberalism (anti-ratification) against Quebecois socialism (pro-ratification), which made sustainable development a distinct feature of Quebecois identity. This situation presented an opportunity for leverage, which the CEO of the SRI fund wanted to use for legitimation purposes. It also appealed to her environmentalist constituents – some of them at least – and it represented her individual preferences. Yet, some actors were opposed to using sustainable development for reframing, arguing that the term is so vague as to simultaneously mean everything and nothing. They claimed it would make SRI redundant and meaningless (observational notes). To overcome its vagueness, the CEO proposed the adoption of eco-efficiency, a meticulous approach to measuring energy consumption:1 What we hope to do is to show that it is possible, from a sustainable develop ment perspective, to invest in clean technologies, using the approach of ecoefficiency. We want to show that these types of firms are viable and that it is possible to generate a return on investment that is acceptable on the financial market, and that sustainable development is not in opposition to economic development (CEO, SRI fund). Since sustainable development appealed to the environmental constituents, including the provincial government that sponsored the SRI fund via the en1

E co-efficiency refers to the meticulous calculation of total energy consumption in the span of a product life cycle. Large data bases contain information about how much energy is consumed during the production, transportation, and destruction of goods. This information is then used to make decisions about which products are least harmful to the environment.

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vironmental NGO, the group eventually agreed to sustainable development as strategic reframing. Strategic reframing thus consisted of leveraging legitimate fields and legitimate events. Leveraging consisted in establishing links to parallel SRI activities in a legitimate field and to contemporary events with high legitimacy and symbolic significance in Quebec. This strategic reframing allowed the legitimizing actors to mobilize support for SRI among the key constituents, all of whom were centrally positioned within the organizational field. It also influenced the shape that SRI would take in everyday practice.

Local Grounding A last dimension in the legitimation process is to anchor the new frame in everyday practice. If the new frame is but an abstract idea, it cannot be construed as meaningful and relevant by field members, even if it is legitimate. It will likely fade away as a fad or fashion. To become legitimate, meaningful, and real to people, a new frame needs local grounding, meaning that it must become integrated into established organizational practices. Local grounding consists of linking the frame to legitimate organizational practices and the associated beliefs, structures, and routines. In the case study, the legitimizing actors grounded SRI in two established practices: eco-efficiency and social economy. That decision was made after searching for examples of how others had applied SRI and sustainable development in practice: Right now I am searching across the world for comparable models. There is very little available: lots of principles, but very few practical examples. The challenge will be how to operationalize sustainable development within the economic context of Quebec, with our entrepreneurs, with our financial logic (CEO, SRI fund). Being trained as an engineer, she was familiar with eco-efficiency. She invited former engineering colleagues with expertise in eco-efficiency to present the model to other group members. In the absence of counter proposals, this model was eventually adopted in a simplified form as an indicator of sustainable development. Only some measures were included in the calculation of total energy expenditure across the product life cycle. 253


The other practice that ensured local grounding was social economy. Social economy has roots in France and Belgium and refers to community organizations that are made financially independent, perhaps even profitable. The sector includes sales of used furniture, community daycare, and meal delivery in the community. In other words, products and services that are useful to the community but not very profitable. The Quebec government endorsed social economy in 1996 and integrated it into the Quebec model. By 2003, social economy had become institutionalized: the concept was familiar and legitimate, and routines were established. For instance, there were practices for how to obtain loans and start-up funding, including assessment criteria and followup procedures. Here was an opportunity for local grounding. The choice of social economy for local grounding came about through networking and strategic alliances. One of the investment firms already invested in, and had strategic alliances with, the social economy sector. This sector represented the values of democracy, transparency, and community that were part of its investment criteria. In addition, the CEO of the SRI fund had previously funded the social economy sector when she worked for the environmental NGO; hence it came naturally to ground SRI in social economy practices. Interorganizational workgroups were created and the CEO later stated that “we made an agreement with the Responsible Investment Network of Quebec and all the community organizations in Quebec to develop a common approach to sustainable development.” (CEO, SRI fund). SRI became grounded in existing practices and gained legitimacy through association with social economy. The choices of local grounding in eco-efficiency and social economy significantly impacted the understanding of SRI. Eco-efficiency came through in the activities that were targeted for investment. The SRI fund would invest in sustainable product development (i.e., eco-efficient technologies for product manufacturing). Social economy manifested in the types of firms that were targeted. The social economy sector is limited to small, perhaps medium size, enterprises in Quebec, which made it natural to select Quebec SMEs for socially responsible investment: We invest in SMEs. We are not at all into large firms. In fact, I think this is a first real case of sustainable development in small firms. I believe very much in local firms. It is not that I am against large structures like General Motors and Chrysler, but I like it when people take charge of themselves. I like that for the entire world, for life in general, but maybe it is particularly important 254


here in Quebec because of our history. Francophones were destroyed. In a few generations we have changed things around (CEO, SRI fund). Through local grounding, SRI became so aligned with existing practices and beliefs in Quebec that the notion of social responsibility merged with the existing understandings: Social responsibility can express itself in many ways, for instance by involving employees in the management of a firm or helping networks of entrepreneurs, local developers, community groups, etc. It can also be to show concern for the environmental consequences of our activities. In fact, we already did these things before the CSR terminology came along. It is like ‘le bourgeois gentilhomme’ who did poetry without knowing it (CFO, investment firm). Local grounding had the effect of increasing the legitimacy of the new frame, but it also had the side effect of making the new frame hard to distinguish from the dominant one. As such, this last dimension of the legitimation process concealed the alternative belief that the new frame conveyed. The entire legitimation process operated in three dimensions. The first dimension, personal preference, illuminated the elements of a new frame that appeared attractive and valuable to legitimizing actors. The second dimension, strategic reframing, had as an objective to mobilize financial and political support from key constituents. The final dimension, local grounding, integrated the new frame with established local practices to make it continuous with daily operations. These three dimensions were aligned with one another and reflected dominant institutions and significant events in the field, making legitimation the act of fitting a novel idea into an existing mold.

Discussion This study of the legitimation process presented a group of actors who legitimized the frame of SRI in the organizational field of Quebec. Legitimation was necessary because the frame did not resonate with widely held beliefs in the field, which held financial gains to be a vehicle of either oppression or liberation, not a synergy factor in relation to social gains. Intervention was required to make the frame legitimate. 255


The legitimizing actors took several steps to legitimize SRI at the center of the field, and they eventually succeeded in obtaining enough support to lauch an SRI fund. The chapter outlined and illustrated three dimensions of their legitimation process. The first dimension was individual preference. Each individual had preferences that corresponded to their own personal and professional trajectory, which overlapped to some extent because of historical events and institutionalized patterns. They saw in the new frame an added value continuous with their existing values and beliefs. This is what attracted them to the new frame and mobilized them to legitimize it in the field. The second dimension was strategic reframing. The legitimizing actors pragmatically evaluated which reframing would appeal most to key constituents (i.e., actors at the center of the field who could either support or prevent the launch of the SRI fund). Their choice of reframing resonated with institutionalized frames and current events, and they leveraged advanced SRI activities in organizational fields that were locally regarded as highly legitimate. In the third dimension, local grounding, the legitimizing actors connected SRI to established, legitimate practices. They embedded the SRI frame in routine procedures and daily activities through connection to eco-efficiency and social economy, which anchored SRI in the state of the art in environmental protection and social capitalism. These three dimensions of the legitimation process were aligned with one another and collectively made SRI appear continuous with institutionalized beliefs. Legitimation basically consisted of combining SRI with legitimate and familiar elements, some of which were historical and local, others contemporary and global. The result was that the new frame appeared as a modern version of an institutionalized frame. In the end, the unfamiliar features had almost disappeared, and the threat to Quebecois identity was eliminated. A question that arises is whether the legitimation process removed all distinguishing features of SRI, making it nothing but old wine in a new bottle. Apparently it did, but the legitimized label may be more significant than one would think. It opens up interaction with other organizational fields that use the label of SRI, which may enable other SRI practices to diffuse more easily into Quebec. In turn, this diffusion may facilitate institutional change. The study represents one example of a successful legitimation process. While success cases provide insight into what is done to legitimize an unfamiliar or illegitimate frame, they cannot inform us which factors are crucial to success. We need contrast with cases of failure to identify which dimensions are neces256


sary and sufficient to legitimize a new frame. Unfortunately, cases of failure are rarely reported in the literature, which leave us to speculate about the most important dimensions of the legitimation process. Perhaps one dimension is more important than another. Perhaps other dimensions are involved as well, such as field conditions at the time of legitimation. This case unfolded at the time of provincial elections, which resulted in a change from social democratic policy to liberal policy at the center of the field. This change may have facilitated the legitimation of SRI. The role of field conditions in legitimation processes certainly merits additional attention in future research. It would be interesting to know if legitimation efforts are effective if the field is not primed to receive the new frame. Future research should use failure cases and comparative case studies to illuminate the conditions that are necessary and sufficient for legitimation. Future research should also make effort to use real-time data to study legitimation processes. Many of the interesting questions cannot be answered by means of archival or retrospective data. For instance, some studies suggest that actors use deliberate strategies (Hargadon and Douglas 2001), whereas others imply less intentionality (Lippi 2000). How are we to know if actors are deliberate in their legitimation activities if we do not observe and interview them at the time of legitimation? Perhaps strategy is an emergent property, but then we need to understand how and why it emerges. Lack of real-time data is, in fact, a widespread obstacle to process studies.

Conclusion This study empirically investigated how embedded actors proceeded to gain cognitive legitimacy for an illegitimate frame within a mature organizational field. The process model contained three dimensions through which embedded actors transformed an illegitimate frame into one that reflects dominant, institutionalized beliefs in the field. They engaged with the three dimensions in a circular fashion, seemingly aware that legitimacy in one dimension would increase legitimacy in another dimension. This process model is the contribution to the literature on legitimation. It supplements previous research with a real-time, empirical account of how individuals engage with organizational and field level factors to legitimize a new frame. The study also contributes to a better understanding of frame alignment. The legitimizing actors engaged creatively with previously unconnected or 257


loosely connected frames, and combined them into a new one. The factor that most clearly determined the selection of frames for alignment purposes was the taken-for-granted beliefs in the field. These institutionalized beliefs made SRI seem attractive to some field members and represented a natural next step in their own insight. The same beliefs were instrumental in convincing actors at the center of the field to endorse SRI. The legitimizing actors could have chosen other specific manifestations of the institutionalized beliefs, and they probably would have done so had they worked for different organizations or had different personal trajectories. While they may have selected different concepts and practices for reframing purposes, the underlying beliefs may well have been the same given the maturity of the field. The study may indirectly illuminate institutional change processes, as well. It may clarify how field conditions interact with individual characterics to provoke institutional change. A process model of institutional change suggests that new institutions are born from local innovations (Greenwood, Suddaby, and Hinings 2002), which can result from collaboration between heterogeneous organizations (Lawrence, Hardy, and Phillips 2002). This literature suggests that local innovation is a somewhat coincidental and haphazard process, one that may later become the object of strategic institutionalization. The present study suggests that strategy may be involved at a very early stage of innovation, long before the first sprout of a new practice becomes visible on the surface. If this pattern is widespread, it may have implications for institutional change processes. Future research should investigate the relationship between legitimation processes and institutional change processes. It is through a better understanding of these processes that we can expand insights into some very interesting phenomena. One of the interesting avenues to explore is the connection of disparate literatures. The first dimension, individual preference, reflects insight from the strategy literature, which emphasizes individual motivation as a driving force behind organizational and field-level change. The fact that individual motivation is shaped by dominant institutions, at least partially, has been emphasized frequently in the institutionalist literature. The second dimension, strategic reframing, corresponds to the social movement literature. Social movement research shows how people and finances are mobilized through reframing and frame alignment (Snow et al. 1986), a process that was reflected more or less in the second dimension of the legitimation process. Similarly, an overlap is found between the third dimension, local grounding, and the translation lit258


erature. Researchers have found that foreign or novel practices are combined with legitimate local practices when they are implemented in practice (Hargadon and Douglas 2001; Lippi 2000; Pieterse 1994). Theoretical formulations of translation (Campbell 2004) and interstitial emergence (Morrill in press) make similar propositions that also correspond to the third dimension of the legitimation process. The model of legitimation processes seems to provide a coherent integration of disparate literatures, which makes it a promising avenue for future research.

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Chapter 10

Institutions and Governance The Dynamics of Change in the Institutional Arrangements of the Danish Labor Market By Steen Scheuer

Introduction Since the 1970s, market economies have evolved rapidly under the impact of a number of forces, including: 1. The globalization of markets for products and services due to a gradual and still on-going dissolution of trade barriers 2. The globalization of capital markets and of communication more generally 3. Ever-faster and more encompassing technological change, leading to more uniform standards in many applications (e.g., computer hardware and software) 4. The breakdown of communism as an alternative to capitalism and market economics Considering this evolution, many have predicted that factors such as globalization and technological development would converge (Castells 1997; Lash and Urry 1987; Offe and Wiesenthal 1985; Regini 2000). It is, therefore, an interesting question why national systems or models in various areas concerning


corporate governance, industrial relations, or social welfare do not seem to be converging to any great extent. While some convergence is visible, the difference between national social welfare or industrial systems – even within the EU – still appear inexplicably immense (Ferner and Hyman 1998; Golden et al. 1997; Traxler 1994; Visser 1991). It is not sufficient to simply note that the predicted convergence has not occurred; a more important contribution would be to try to explain the causal mechanisms behind the apparent divergence. This chapter attempts to make this contribution by employing recent theoretical contributions, utilizing aspects of the varieties of capitalism (VOC) approach (see Hall 1999; Hall and Soskice 2001; Streeck and Thelen 2005; Thelen 2004), while also relying on the industrial relations approach (see Hyman 2001; Ferner and Hyman 1998). In this context, the VOC approach means distinguishing between different institutional arrangements (often liberal versus coordinated market economies), implying two basic types of capitalism with different equilibrium outcomes. Institutional arrangements do not, therefore, have the same effects across these types. This begs questions, such as: If market economies are not converging under the obvious influence of globalization, technological advances, etc., what is driving change in national systems? Which institutional factors are used and what are their roles? Does institutionalism simply mean restraint (lagging behind), or do institutional logics drive evolution and change along different paths? It has been stated that while continuous resource allocation and employment issues are matters occurring incessantly, and thus belong under neoclassical economics (i.e., agency theory), issues of governance and of institutional environments appear to change less frequently, in periods of one to ten and ten to a hundred years, respectively. If true, this has two implications: 1. Studies of governance and of institutional environments are studies of features with more inertia (and thus less interesting), but also of greater significance (and thus more interesting). 2. When one considers the functioning of the labor market or the welfare state, the underlying causal factors will be partially at variance, depending on the institutional arrangements already in place in the countries, companies, or labor markets under consideration. Institutional factors not only determine stability and resistance to change, they may also enhance the opposite: a constant desire for change (i.e., a change orientation). 264

Institutions and Governance

The VOC approach is often described as consisting of five types of institutional arrangements, or systems: the corporate governance system, the industrial relations system, the inter-company system, the vocational training and education system, and the social welfare system. In the literature, these five systems result in two distinct production regimes, or types of market economies: coordinated market economies and liberal market economies. Not only do these two regimes reflect different institutional logics, they even determine that environmental challenges are tackled in sometimes quite diverse ways. This may appear as a variant of the contingency approach in organization theory (Mintzberg 1979; Scott 2003), which emphasizes that there is not one best way for a company, indeed a country, to organize its production, its services, its politics, and its resource allocation. This chapter looks specifically at the Danish industrial relations system from a VOC approach. While there is a clear lack of convergence in industrial relations (IR) systems, these systems still undergo substantial change in most, if not all, nations. Employing comparative data, the emphasis will be upon six factors characterizing institutional arrangements in market economies:

1. Union density and collective bargaining coverage 2. Trends in composition of the labor force 3. Changes in labor law 4. Trends in union impact on wages and other economic conditions 5. The prevalence of industrial conflict 6. Changes in the political orientation of unions

These factors represent quite distinct dimensions of the national institutional arrangements of market economies. How these particular institutional factors mediate, influence, and are balanced against market forces under the influence of globalization will be a substantial part of the following discussion.

1. Trends in Membership and Density In general, the regulation of labor market issues in Denmark has been left very much to the two sides of industrial relations, employers’ associations and trade unions, thereby reducing legal regulation to a minimum. Until recently, both sides were of the opinion that most, if not all, labor market issues were better 265


solved at the collective bargaining level, excluding intervention by parliament or government. By implication, there were relatively few areas of working life covered by law, compared especially with countries in continental Europe. This had the curious effect that even many International Labor Organization (ILO) conventions concerning working life issues were not ratified by the Danish parliament.1 In fact, all issues regarding pay (including setting a minimum wage) have been absent from Danish law. Most issues concerning working time and gender were also left out, while issues regarding the work environment, holiday entitlements, and employment protection for salaried employees were legally regulated (Due and Madsen 1994; Scheuer 1998a). Neither Danish law nor the Danish Constitution contain clauses guaranteeing the right to strike or the right to collective bargaining (Due and Madsen 1994; Kristiansen 1997; Nielsen 2001; Scheuer 1998a). The right to strike follows indirectly from the so-called peace obligation, which is part of the general agreement between the main employers’ association, the Confederation of Danish Employers (Dansk Arbejdsgiverforening, or DA), and the main trade union confederation, the Danish Confederation of Trade Unions (Landsorganisationen i Danmark, or LO). The peace obligation – originally formulated during the historic September Compromise in 1899 – is only in force for the term of a valid collective bargaining agreement for the group or company in question. This has the following implications: For companies, it is voluntary to become party to a collective agreement. For instance, a new company has no direct legal or other obligation to enter into one, even when faced with a demand from its employees to do so. For employees, there is no legal recourse for demanding a collective agreement. If the employer will not concede, he or she cannot be taken to court.2 The employees do, however, have the right to strike. Industrial conflict is legal, unless the parties are part of a collective agreement containing the peace obligation. Once a company has entered into a collective agreement, adherence to its clauses becomes mandatory. In the beginning of the twentieth century, parliament created – on the recommendations of DA and LO, the Industrial Court (Arbejdsretten), which consists of an equal number of judges from both s a case in point, consider the first ILO convention, C1, from 1919 regarding the forty-eight hour work A week. 2 Many U.S.-owned companies in Denmark (e.g., IBM or Hewlett-Packard), do not have collective agreements for their employees, while some do (e.g., Toys’R’us). 1

266


sides and one from the Supreme Court. By implication, collective agreements have, in practice, the force of law. This mandatory and binding institutionalist framework and character of the collective agreement is underscored by the fact that virtually all collective agreements have a fixed time duration of two, three, or sometimes four years. (It can be one year, but only in exceptional cases.) When they expire, trade unions and employers’ associations may legally declare a strike or a lock-out; however, parliament has – also on the recommendation of DA and LO – passed a law creating state mediators, who have considerable power in the process of collective bargaining and the renewal of collective agreements. These mediators (there are three in total) can require the parties in the national agreements to enter into negotiations under his or her guidance, put forward compromise solutions, and even decide how the parties should vote on them in the ensuing ballot (see section 5.2. below). In reality, companies in Denmark that have become part of this institutionalist regime can only leave it with great difficulty and risk – in fact, this rarely happens – which ensures the level and stability of the general collective agreement coverage rate (see section 1.2., and also Scheuer 1997; Scheuer and Madsen 2000, 25). This combination of voluntary and mandatory institutional traits effectively means that no company or no group of employees is forced into collective agreement coverage, either by directly signing the agreement, or by joining and employer’s association.3 Denmark has, therefore, no legal extension, or erga omnes clauses or mechanisms, except for rules concerning apprentices and pupils. In some countries.(e.g., France, Germany and Austria) parliament or government can extend collective bargaining agreements into a whole sector or industry. While the collective agreement coverage rate in Denmark is higher than in countries where unionism is generally weak and has few institutionalist supports, it is not nearly as high as in countries which have erga omnes mechanisms (Traxler 1994, 2000). The following sections consider the most important changes in the structure of trade unionism, of the collective bargaining regime, and of labor law since the 1980s.

3

f employees covered by a collective agreement, nearly thirty-eight percent are covered through a O single-employer agreement (cf. DA 2003, 246).

267


1.1. The Basic Structure of Unionism in Denmark Denmark has a generally high and reasonably stable union density, but also a relatively low degree of competition over membership. This means that the choice of union is rather simple for most occupations. Demarcation disputes occur time and again, and some smaller unions outside the main confederations try to compete, but the constellation of Danish unions has been relatively stable over time. The breakdown is as follows: • The Danish Confederation of Trade Unions (LO) is the largest union confederation. It consists of seventeen member unions in three general categories: one for all types of manual workers (skilled, semi-skilled, and unskilled); one for salaried employees (whose unions’ members equal less than half the total number of office clerks, shop assistants, technical assistants, etc.) and one for public sector workers. Demarcations between the member unions are established on the basis of vocational background – requiring very little education – and on the basis of the type of work undertaken by members. Total membership is nearly 1,340,000. • The Confederation of Unions for Salaried Employees and Civil Servants (Fællesrådet for Tjenestemænd og Funktionærer, or FTF) is the second largest, and consists of unions comprising school teachers, kindergarten teachers, police officers, nurses, IT professionals, finance sector employees, etc. It has more than 100 member organizations and 361,000 members. • The Danish Confederation of Professional Associations (Akademikernes Centralorganisation, or AC) is the confederation of unions for employees with a university degree, organized on the basis of their particular education or occupation, including medicine, civil engineering, science, law, economics, business economics, the humanities, etc. Its twenty-two member organizations have 163,000 members. • The Danish Association of Managers and Executives (Ledernes Hovedorganisation, or LH) is the union and confederation of managers. It has a special status as a peak confederation due to particular circumstances when the principles of the Danish Labor Market Model were first formulated at the turn of the nineteenth and twentieth centuries (cf. Due et al. 1994; Scheuer 1998a). Employees who are foremen, or otherwise act on behalf of management, are not allowed to be unionized under the LO.4

268


The need arose, therefore, for a special union for these groups. Today, it has nearly 76,000 members. • Independent unions are those whose members do not fit in any of the abovementioned confederations. This category is comprised by a mixed group of unions, some of whom compete openly – mainly with the big LO unions. The Christian Union is the largest of these (with 86,000 members). In total, independent unions have approximately 144,000 members. The basic organizational principle behind this structure is the principle of craft and general unionism, which still prevails, although it does not predominate.5 Some industrial unions exist, but even the general unions in the LO organize themselves and their external demarcations on the basis of craft or trade, even including work that could not properly be considered a craft (e.g., unskilled building workers, cleaning assistants, bus drivers, and kitchen or cleaning assistants in homes for the elderly). Changes in the structure of these occupations, such as privatization or technological changes, may give rise to disputes, but within the main confederations the craft, trade, or type of work is still seen as the primary principle for the solution of these disputes. 1.2. Trends in Membership and External Structure Contrary to most other advanced market economies, Danish union membership and union density were relatively stable in the period from 1980 until a peak in 1995, after which point they began to decline. In the 1960s, union density was either stagnant, at around sixty-two percent, or slightly declining even though membership in absolute numbers increased (there was low unemployment but also a steep increase in labor force participation by women). In the 1970s, rising unemployment precipitated another steep increase in the union participation of women and also of salaried employees, which led to a higher union density of eighty-six percent (Ebbinghaus and Scheuer 2000; Scheuer 1986, 137). This high level indicated (and still indicates today) the fact that salaried employees who are least likely – in most countries – to be unionized, such as private sector managers and university graduates, are so to a reasonable degree in Denmark. S ee clause five of the main agreement of the original September Compromise. It is still part of the main agreement today. 5 For a more thorough treatment, see Scheuer 1998a, 152–4 4

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Year Union 1980 confederation

1985

1990

Share of aggregate membership

1995

2000

2005

1980

2005

thousands

%

LO

1,270

1,402

1,423

1,510

1,459

1,369

70

65

FTF

267

314

325

332

350

361

15

17

AC

70

85

103

132

150

163

4

8

LH

24

24

71

75

80

76

1

4

Independent

194

211

186

115

123

144

11

7

Total Membership

1,825

2,036

2,107

2,163

2,162

2,113

101

101

Work force excluding selfemployed

2,246

2,434

2,674

2,617

2,759

2,753

Union density (%)

77.8

80.7

79.8

82.7

78.4

76.8

Table 10.1. Union membership in Denmark by union confederation, number of employees in work force (employed and unemployed), and aggregate union density. 1980 to 2005. Source: Statistical Yearbook and Statistical Ten-Year Review, various years. The Danish Statistical Office

Table 10.1 clearly demonstrates that while union density in Denmark is quite stable, with an average around 75–80%, it as been slowly but steadily declining since its peak in 1995 at 82.7%.6 This decline is less a function of declining aggregate union membership than of an increase in the size of the dependent workforce: Aggregate union membership has declined by 50,000, while dependent employment has increased by 136,000. This might appear as a failure of LO unions to recruit a large enough share of the new entrants into the labor market. 6

F or a discussion of historical trends in comparative union densities and methodologies, see Ebbinghaus and Visser (2000) and Visser (1991). For a discussion of historical trends in Danish union density, see Ebbinghaus and Scheuer (2000).

270


This stability of membership and density does, however, reflect underlying changes, some of which are quite significant (see, for example, the last two columns in Table 1). First, the LO member unions’ membership figures are declining. Since 1995 the LO unions have lost on average one percent of their membership every year, down from 1,510,000 to 1,369,000 members (Table 1), reducing their share of all unionized workers from seventy-three to sixty-five percent. In the same period, membership figures for the most prominent confederations (FTF, AC, and LH), as well as for some smaller unions, have seen strong growth. The FTF went from 267,000 to 361,000 members, while the AC went from 70,000 to 163,000 members, the latter jumping from four to eight percent of unionized employees. This basically reflects two processes of change in the Danish labor market: 1. The composition of the workforce is changing, especially towards more highly educated workers. The increase in the number of employees who hold a university or professional degree implies that a declining share of the employed workforce belongs in the unions under the LO, because they belong to one of the AC unions, or to the FTF. 2. Outsider unions, especially the Christian Union, has been making inroads into some of the core areas of LO union membership. The growth figures of some of these unions have been quite impressive, but they still constitute only a minor share of the aggregate membership (7%). Since they typically have no, or virtually no, collective agreements, their role in the bargaining processes in the labor market is still quite marginal. The LO confederation still organizes around 65% of all unionized workers, but this share is also declining. In the private labor market, LO’s position is still dominant, since only few FTF or AC unions have bargaining agreements with private sector employers or employers’ associations. In the public sector, the LO shares this position with the FTF and AC. The gradual decline of the LO’s overall share of union membership – factoring in the slight decline in union density – means that even if the present situation is still quite good for the unions, especially in comparison with unions in other advanced market economies, the declining trend cannot continue for very long without consequences for their bargaining position and societal influence.

271


2. Trends in the Occupational and Industrial Composition of the Labor Movement The industrial composition of the workforce (and, thus, of the labor movement) has altered in ways that are broadly similar to changes in other advanced market economies. The move from the primary and secondary sectors towards the tertiary sector is nearly universal, although in Denmark this trend has been spearheaded to a large extent by the growth in public sector employment. In 1960 thirty-two percent of the aggregate workforce was in the tertiary private sector while public sector employees accounted for only fourteen percent. In 1990 the tertiary private percentage had barely changed, while the public sector grew to thirty-five percent, implying that virtually all service sector growth during the period was concentrated in the public sector (Scheuer 1998a, 149). Since 1990 the evolution has, however, changed: growth has gravitated slightly more towards the private service sector (see Table 10.2). Today, employment in the tertiary private sector is only marginally larger than in the tertiary public sector. Sector: Year

Primary

Secondary

Tertiary private

Tertiary public

Total

1960

21

33

32

14

100

1970

11

34

33

21

99

1980

8

27

32

33

100

1990

6

26

33

35

100

2000

4

26

34

35

99

2006

3

23

37

36

99

Table 10.2. The relative distribution of the labor force in Denmark by sector (%) and by employment status, 1960–2005

The trend from 1960 to 1990 was very much a consequence of the growth of the public sector, which began slowing down in the late 1980s. This trend was positive for the labor movement, since collective bargaining coverage is nearly total in this sector and bargaining partners (i.e., public sector employers) are much easier to access than employers in the private sector. Since about 272


1990, relative growth in the composition of the workforce has, however, been concentrated in the private service sector, where unions are relatively weaker, especially with regard to collective bargaining coverage. Union density may be lower, but Denmark does not hold to the same pattern as most other advanced nations, where only a minority of employees in the private service sector is unionized. Even in the private service sector, union density is remarkably high (see Table 10.3).

All private sector employes

Density

Collective agreement

Percent

Percent

n

82

71

2,452

Manual worker

84

81

1,025

Salaried employee

82

62

1,204

Manager

64

40

103

Professional qualifications

83

56

199

Intermediate level qualifications

81

67

433

Clerical work

83

62

313

Sales, service, and care.

79

68

320

Craft/skilled work

90

83

527

Process and operation work

90

89

232

Other work

76

73

322

..

82

1,520

Employment type

Hierarchical position

Union type LO and FTF

273

The Anatomy of Change – A Neo-Institutionalist Perspective Other union

..

53

376

Not unionized

..

50

536

Primary sector

69

54

70

Manufactoring

81

76

1,001

Building & Construction

86

75

198

Transport

86

78

129

Trade

68

57

344

Finance

81

90

188

Other private service

72

54

352

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