Examining ‘Institutionalization’: A Critical Theoretic Perspective

Introduction

Various forms of critical theory have been suggested to illuminate social practices. Versions of such theories has been promoted for the analysis of management, organizations and work (e.g. Burrell, 1988; Burrell, 1994; Alvesson and Willmott, 2004) and this chapter considers how such analyses, with their emphasis on power, domination and emancipation, can be used to examine a central focus of institutional theory, namely institutionalization. Limitations and anomalies in institutional theory have stimulated its development from ‘old’, through ‘new’, to ‘neo’ variants of analysis1 (DiMaggio and Powell, 1991). At each stage, institutional theory has taken on board and accommodated critiques which, alternatively, have called for a rebalancing of the emphasis given to the conditioning constraints of ‘structure’ or the innovative capabilities of ‘agency’ (Reed, 1997). This chapter steps back from this process of critique and incorporation to provide a ‘critical theoretic’ illumination of institutional theory to facilitate reflection on its distinctiveness and limits.

We begin by noting how, in their different ways, varieties of institutional theory and critical theory share an attentiveness to institutionalization, conceived as processes that order and constrain but also enable forms of interaction and organization. In institutional theory, dominant ‘logics’ that are irreducible [Page 674]to rational choices or a to a series of environmental contingencies, are held to account for why, for example, within a population of organizations there is an homogeneity of form and practice. For critical theorists, processes of institutionalization account for how patterns of domination and oppression -for example, racism or sexism but also more subtle, normalized forms of subjugation such as bullying and pressurizing at work -become naturalized in workplaces and elsewhere yet, in principle, are open to transformation. What they share, nonetheless, is a rejection of analysis founded upon methodological individualism (e.g. rational choice theory)2 that ignores how ‘choices’ are embedded in, and organized through, processes that are infused with value. So, for example, in principle, institutional theory problematizes analyses that do not appreciate how the very idea of ‘choice’, for example, articulates a particular, institutionalized way of making sense of the world. Critical analyses extend and radicalize this understanding as institutionalization is examined as a means of domination and oppression.

An earlier version of this paper was presented to the Organization Theory Research Group at the Tanaka Business School, Imperial College, London. We would like to thank participants at this meeting for their helpful and supportive discussion of the paper and especially the comments received from Marc Ventresca and Andre Spicer. We are especially indebted to Nelson Phillips and Jaco Lok for their invaluable suggestions for focusing and clarifying central arguments of the paper. Albert James assisted with the references. David Cooper and Mahmoud Ezzamel thank the Social Sciences and Humanities Research Council for financial support, and David Cooper thanks the Certified General Accountants of Alberta for their financial support.

We conceive of the differences - of emphasis and bearing - between institutional and critical theories in terms of their contrasting value-orientations.3 Crucially, we reject any suggestion that institution theory is value-free whereas critical theory is value-laden or normative. Instead, both are normative, although in different ways. In broad terms, institutional theory is conservative insofar as it inclines to naturalize the status quo and shies away from (critical) theories that, in contrast, problematize the status quo as oppressive. A key difference is that the normativity of institutional theory is occluded by its pretensions to positivist objectivity whereas the normativity of critical theory is comparatively explicit.

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