Institutional Entrepreneurship and Systemic Change
Well-functioning institutions are necessary preconditions for economic development. But endogenous institutional change is, by definition, difficult. In two separate papers, I use matched-case comparisons that follow change efforts from their early stages to advance our understanding of systemic change. Both papers take an “inhabited institutions” approach to study how individuals relate to systems in the attempt to purposefully change them.
The first (2016), focuses on the question of how individuals discover, experiment with, and legitimize new organizational practices that can challenge the status quo and create new institutional realities. It analyzes the creation of the small business credit market in Mexico. I use variation in the strategies that actors followed and the results they achieved across banks and Mexican states to show that successful institutional entrepreneurs operated at two distinct layers to promote institutional change. One entailed invisible, undocumented, tactical work to recruit team members, find resources, negotiate with stakeholders, run small-scale experiments, and coordinate action. The second (and the focus of prior research) entailed purposefully visible, staged, and scripted symbolic work. While invisible work was seen as the “real work” that consumed most energy, symbolic work was essential to advance every stage of the change process. The findings clarify that institutions operate through generalized beliefs about public codes, or what “everybody thinks everybody thinks.” Thus, within stable institutions there are always individuals who privately envision potential alternatives, even as they publicly endorse the existing order. For every successful and documented case of institutional change, there is significant invisible work by actors who, often, are the unreported agents of institutional change.
A second paper with Mikaela Bradbury, Tony Sheldon, and Charlie Cannon (ASQ 2024), explores a complementary challenge of systemic change, which requires actors to jointly experiment with new approaches and practices across organizations, sectors, and communities of practice. This need to collaborate and learn across boundaries amplifies the uncertainty inherent in organizational innovation.
Our work examines eight international development interventions across four countries to identify the mechanisms that allow individuals across organizations and communities of practice to coordinate for risky systemic change. To contain the amplified uncertainty of systemic change, successful actors built a set of scaffolds that granted temporary support to all stakeholders. They are scaffolds because, while clearly structural, they are also temporary, modular, and interdependent. They provided support along two complementary dimensions, allowing actors to establish temporary, shared norms and engage in coherent action. One set of structural scaffolds constituted tangible elements like physical spaces, managerial skill, and financial resources that removed critical constraints for all relevant stakeholders. They set the stage for actors to explore new ways of relating and performing. A second set of programmatic scaffolds provided direction and order to ensure that the structural scaffolds were used to their potential, coherently, and in pursuit of a collective goal. We thus provide an integrated model for how actors initiate and sustain risky systemic change across organizations and communities of practice. We are developing these ideas further in a book (outlined here). We are also distilling key elements in articles written for practitioners (e.g. 2019).