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Opening the Black Box: The Microfoundations of Institutions

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... This focus could potentially shine a spotlight on topics within the Carnegie School (e.g., conflict, politics, interpretation, ambiguity, search) that are also important but currently remain largely unexplored within Routine Dynamics. Similarly, the promise of the Carnegie School to serve as microfoundations in institutional theory (Powell and Rerup, 2017), could potentially improve by conceptualizing experiential learning as a process of patterning. This focus could highlight the role of routine actors, action and artifacts in shaping, maintaining and changing higher-level patterns and structures such as institutions (Royer and Daniel, 2019). ...
... Integrating exogenous and endogenous change processes to advance our understanding of stability and change can contribute to addressing a challenge in the wider organizational theory community --bridging the micro and macro divide (Salvato and Rerup, 2011;Powell and Rerup, 2017). Disentangling exogenous and endogenous change in routines and considering the larger situated context could, for instance, help address puzzles such as the "paradox of embedded agency" (Seo and Creed, 2002). ...
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Given the centrality of experiential learning in the Carnegie School, we focus on how this form of learning provides an opportunity for deepening the relationship between the Carnegie School and Routine Dynamics. Experiential learning is central to Routine Dynamics because the flow and progression of routines emerge from experiential learning like processes of taking action, evaluating the results of those actions, and, if necessary, making adjustments to future actions.
... The desired team cooperation and giving full play to the team advantage of 1 + 1 > 2 is difficult to achieve if team institution is lacking, even if team composition is reasonable. Therefore, scholars argued that a team composition perspective cannot open the black box between the entrepreneurial team and the growth of the firm, and exploring the mechanism of the entrepreneurial team on the sustainable growth of start-ups is necessary from the perspective of institution [5,6]. The same is true for the field of social entrepreneurship. ...
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Why are some social entrepreneurial teams able to adapt to challenges and leverage the opportunities that are generated from a crisis, and why can some start-ups achieve sustained growth yet others do not? From the perspective of relational governance, this study unpacked the mechanism of how entrepreneurial teams promote social start-ups’ abilities to deal with crises and the mediating role of team learning through a survey of 396 social entrepreneurial team members. The results showed four key findings. (1) Trust among entrepreneurial team members has a positive effect on organizational resilience, whereas shared vision and communication-cooperation do not. (2) All the dimensions of relational governance positively promote team learning, and team learning is positively associated with organizational resilience. (3) Team learning mediates the effect of entrepreneurial team relational governance on organizational resilience; specifically, team learning plays a complete intermediary effect on shared vision and communication-cooperation to organizational resilience, whereas it plays a partial intermediary effect on trust in organizational resilience. (4) Team learning is the key factor to organizational resilience, whereas communication-cooperation promotes team learning the most. Practically, to strengthen social start-ups’ organizational resilience, entrepreneurial team members must first improve their understanding of environmental adaptability and then engage in productive and creative dialogues to manage issues, improve team members’ capability in information integration, as well as agree upon the action and activities that should be performed.
... An important aspect of the call of scholars for considering the micro-foundations of institutions is the urge to pay attention to unimportant people in everyday situations (Powell & Colyvas, 2017). People mindfully reflect on their daily practices. ...
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Organizations incorporate the institutional demands from their environment in order to be deemed legitimate and survive. Yet, complexifying societies promulgate multiple and sometimes inconsistent institutional prescriptions. When these prescriptions collide, organizations are said to face “institutional complexity”. How does an organization then incorporate incompatible demands? What are the consequences of institutional complexity for an organization? The literature provides contradictory conceptual and empirical insights on the matter. A central assumption, however, remains that internal incompatibilities generate tensions that, under certain conditions, can escalate into intractable conflicts, resulting in dysfunctionality and loss of legitimacy. The present research is an inquiry into what happens inside an organization when it incorporates complex institutional demands. To answer this question, I focus on how individuals inside an organization interpret a complex institutional prescription. I examine how members of the French Development Agency interpret ‘results-based management’, a central but complex concept of organizing in the field of development aid. I use an inductive mixed methods design to systematically explore how different interpretations of results-based management relate to one another and to the organizational context in which they are embedded. The results reveal that results-based management is a contested concept in the French Development Agency. I find multiple interpretations of the concept, which are attached to partly incompatible rationales about “who we are” and “what we do as an organization”. These rationales nevertheless coexist as balanced forces, without escalating into open conflict. The analysis points to four reasons for this peaceful coexistence of diverging rationales inside one and the same organization: 1) individuals’ capacity to manipulate different interpretations of a complex institutional demand, 2) the nature of interpretations, which makes them more or less prone to conflict, 3) the balanced distribution of rationales across the organizational sub-contexts and 4) the shared rules of interpretation provided by the larger socio-cultural context. This research shows that an organization that incorporates institutional complexity comes to represent different, partly incompatible things to its members without being at war with itself. In doing so, it contributes to our knowledge of institutional complexity and organizational hybridity. It also advances our understanding of internal organizational legitimacy and of the translation of managerial concepts in organizations.
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