Examining ‘Institutionalization’: A Critical Theoretic Perspective*study.sagepub.com/sites/default/files/28 Cooper, Ezzamel & Willmott.… · Examining ‘Institutionalization’:

Examining ‘Institutionalization’:A Critical Theoretic Perspective*

David J. Cooper, Mahmoud Ezzamel and Hugh Willmott

INTRODUCTION

Various forms of critical theory have beensuggested to illuminate social practices.Versions of such theories has been promotedfor the analysis of management, organiza-tions and work (e.g. Burrell, 1988; Burrell,1994; Alvesson and Willmott, 2004) and thischapter considers how such analyses, withtheir emphasis on power, domination andemancipation, can be used to examine a cen-tral focus of institutional theory, namelyinstitutionalization. Limitations and anom-alies in institutional theory have stimulatedits development from ‘old’, through ‘new’, to‘neo’ variants of analysis1 (DiMaggio andPowell, 1991). At each stage, institutional

theory has taken on board and accommo-dated critiques which, alternatively, havecalled for a rebalancing of the emphasisgiven to the conditioning constraints of‘structure’ or the innovative capabilities of‘agency’ (Reed, 1997). This chapter stepsback from this process of critique and incor-poration to provide a ‘critical theoretic’ illu-mination of institutional theory to facilitatereflection on its distinctiveness and limits.

We begin by noting how, in their differentways, varieties of institutional theory and crit-ical theory share an attentiveness to institu-tionalization, conceived as processes thatorder and constrain but also enable forms ofinteraction and organization. In institutionaltheory, dominant ‘logics’ that are irreducible

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

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to rational choices or a to a series of environ-mental contingencies, are held to account forwhy, for example, within a population oforganizations there is an homogeneity ofform and practice. For critical theorists,processes of institutionalization account forhow patterns of domination and oppression –for example, racism or sexism but also moresubtle, normalized forms of subjugation suchas bullying and pressurizing at work –become naturalized in workplaces and else-where yet, in principle, are open to transfor-mation. What they share, nonetheless, is arejection of analysis founded upon method-ological individualism (e.g. rational choicetheory)2 that ignores how ‘choices’ areembedded in, and organized through,processes that are infused with value. So, forexample, in principle, institutional theoryproblematizes analyses that do not appreciatehow the very idea of ‘choice’, for example,articulates a particular, institutionalized wayof making sense of the world. Critical analy-ses extend and radicalize this understandingas institutionalization is examined as a meansof domination and oppression.

We conceive of the differences – ofemphasis and bearing – between institutionaland critical theories in terms of their con-trasting value-orientations.3 Crucially, wereject any suggestion that institution theory isvalue-free whereas critical theory is value-laden or normative. Instead, both are norma-tive, although in different ways. In broadterms, institutional theory is conservativeinsofar as it inclines to naturalize the statusquo and shies away from (critical) theoriesthat, in contrast, problematize the status quoas oppressive. A key difference is that thenormativity of institutional theory isoccluded by its pretensions to positivistobjectivity whereas the normativity of criti-cal theory is comparatively explicit.

A guiding thread running through thechapter is the (institutional) idea that criticaltheory and institutional theory are embeddedin differing ‘general views of life and the Universe’ that articulate different projectswhich are inherently political in their

commitments and consequences. The differ-ences are both theoretical and practical. AsLounsbury (2003: 16) notes, differences oforientation to ‘the problem of order as wellas conflicting social imageries of the rela-tionship between culture and power leadinstitutional and critical analysts of organiza-tions to ask different kinds of questions’.This observation helps to account for why, inthe voluminous literature of institutionaltheory, there are so few references to key crit-ical thinkers, such as Marx, Habermas andFoucault.4 Advocates of institutional theoryposition and develop their work in rela-tion to rational choice theory, contingencytheory and resource dependency theory.Consideration of the possible relevance ofcritical theory concepts of ‘totality’, ‘contra-diction’ and ‘praxis’ (Benson, 1977) is highlyunusual (e.g. Seo and Creed, 2002).Tellingly, what is perhaps the most pene-trating critique of institutional theory(Hasselbladh and Kallinikos, 2000) has beenignored in the plethora of institutional papersthat have appeared since its publication.5

We will argue that institutional theory isembedded in a distinctive tradition of socialscientific enquiry that is preoccupied with thepossibility of developing more objectiveknowledge of what it conceives the socialworld to be (that is, a product of processes ofinstitutionalization). A concern to enhanceprediction – for example, by researching howstrategic responses ‘are predictable largely interms of the nature of institutional pressures’(Oliver, 1991: 174) in order to secureimproved control of the social world – pro-vides a taken for granted, but rarely interro-gated, impetus for institutional theory. Otherpossible traditions of social science –hermeneutic or critical (see Bernstein, 1976) –are rarely contemplated or debated. In con-trast, critical theoretic analysis conceives ofsocial scientific knowledge production inrelation to its capacity to de-naturalize thepresent, and thereby to open up questions of whether the conditions and consequencesof present circumstances are oppressive oremancipatory (and to whom).

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From these introductory remarks, it can beappreciated that it is a challenging task torelate institutional theory to critical theory.Critical theory (and indeed institutionaltheory) covers a vast and expanding terrainof intellectual endeavour (see Appendix) andconsideration of its connection(s) with insti-tutional theory can be approached fromnumerous angles. A review might, for exam-ple, consider how key elements in institu-tional theory relate to, deviate from, or run inparallel to a more narrowly (e.g. confined toCritical Theory, Marxism, and so on), or to amore expansive (e.g. extending to poststruc-turalist theory) notion of critical theory.Alternatively, a review of their relationshipmight concentrate on those contributions toinstitutional theory that have selectivelydeployed elements of critical theory to refineor augment their analysis; and such a reviewcould be extended to discuss how other ele-ments of critical theory may be incorporatedin the development of institutional theory. If, however, the value-orientations of insti-tutional theory and critical theory arebelieved to diverge significantly, as we have suggested, then it is an unrewardingchallenge to imagine how either theory can be subsumed within the other withoutdiluting or compromising their distinctiveintent and associated contributions to knowledge.6 Our favoured approach, there-fore, develops an appreciation of, and respectfor, their differences; and it explores how a variant of critical theory may be engaged to shed some new light upon the particularityand limits of institutional theory but withoutthe restrictive and subjugating requirementof having to limit an assessment or demon-stration of its relevance and value as asource of remedies for problems preoccupy-ing institutional theorists.

Accordingly, in this chapter, in-depthattention is given to one key contribution tocritical theory – the work of Michel Foucault.We mobilize his thinking to give some indi-cation of what it could mean to think criti-cally about the value-orientation andcontribution of institutional theory; and,

more specifically, to reflect critically uponthe role and relevance of notions of ‘power’and ‘agency’ invoked by neo-institutionaliststo address its alleged anomalies and limitations. We have two reasons for ourselection of Michel Foucault. The first is thatduring the past decade and more his thinkinghas been exceptionally influential in socialscience as well as critical theory.7 The secondis that his writings on power and subjectifica-tion are suggestive of an alternative under-standing in which oppressive dimensions andeffects are the focus of analysis.

Subjectification is conceived by Foucaultas the ‘different modes by which ... humanbeings are made into subjects’ (Foucault,1983: 208). Foucault’s focus upon subjectifi-cation has an (unexplored) resonance withprocesses of institutionalization, not leastbecause, as Hasselbladh and Kallinkos(2000: 701) put it, ‘institutionalization is sus-tained and given meaning and directionthrough its capacity to constitute distinctiveforms of actorhood’. A condition of institu-tionalization, in other words, is subjects’identification with the forms and practicesthat it reproduces. For example, in modernsocieties, the institution of actorhood – that isthe attribution of agency to subjects – is pre-dominantly constituted and institutionalizedin ways that Weber (1978) has characterizedas ‘instrumental’. Actors’ identifications withthe institutions of work, family, religion, etc.become progressively less traditional, affec-tive or value-rational. Crucially, this does notmean that we are any less habituated to, orany less institutionalized or subjectified asagents within zweckrational modes ofaction.8 Indeed, the commonsense appeal ofrational choice explanations of action is,from an institutionalist perspective, indica-tive of the dominance of what, in aFoucauldian analysis, might be identified asa particular mode of subjectification. Thismode is disciplined by a specific conceptionof competent agency that privileges and nat-uralizes the exercise of conscious, sovereigncalculation to achieve desired ends withappropriate means (see also Friedland and

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Alford, 1991). This chapter explores theseissues in more detail.

The next section provides a discussion ofhow a particular understanding of institutionshas become naturalized in institutionaltheory and introduces our focus on issues ofpower and agency. This is followed by a briefoverview of critical theory before we attenddirectly to Foucault’s contribution to concep-tualizing power, knowledge, and subjectifi-cation. Applying Foucault’s ideas, we thenconsider some recent efforts to revise institu-tional theory. A further section discusses anumber of issues arising from our explo-ration of the relationship between institu-tional theory and critical theory before wedraw together our main arguments.

INSTITUTIONAL THEORY ANDINSTITUTIONALIZATION

Before ... institutionalisms themselves becomeinstitutionalized – reified as distinct ‘theoreticalstrategies’, codified in textbooks, and taken asgiven by practitioners – we had better take stock.(Jepperson, 1991: 143–144)

Jepperson cautions against a forgetfulness ofthe particularity of institutional theory – inthe sense that it is a construction based uponspecific, institutionalized assumptions.Within this particularity, there is consider-able diversity and debate (DiMaggio andPowell, 1991) and recurrent attempts to rec-oncile internal differences (e.g. Hirsch andLounsbury, 1997). Institutional theory’s par-ticularity has been frequently surveyed andtypified (e.g. Scott; 1991; DiMaggio andPowell, 1991) but, for the most part, has notbeen critically addressed. In this section, weexamine this particularity through a series ofreflections upon institutional theory’s ‘take’on institutionalization. We consider the con-tributions of a number of leading proponentsof institutional theory and pay particularattention to Berger and Luckmann’s discus-sion of institutionalization as this has pro-vided a key source of inspiration and

legitimation for institutional theorists. Ourspecific focus is on questions of how‘agency’ and ‘power’ are addressed andincorporated within institutional theory.

Conceptualizing institutionalization

In his landmark text on institutional theory,Scott (1995/2001) identifies Parsons’ defini-tion of institutionalization as a synthesis of the arguments of earlier major theorists(e.g. Veblen, Commons, Durkheim, Weber):‘A system of action is said to be institution-alized to the extent that actors in an ongoingrelation oriented their action to a common setof normative standards and value patterns’(Scott, 1995/2001: 15, emphasis in original).For Parsons, compliance to institutionalnorms ‘is a need disposition in the actor’spersonality structure’ (1951: 37, cited byScott, 1995/2001: 12), where compliance ismotivated by the moral authority that institu-tional norms exert over the individual. Actorsfeel compelled to comply because refusal orfailure to do so results in feelings of anomieand, at the extreme, mortification.

Critics of this (functionalist) conception ofinstitutionalization have argued persuasivelythat it attributes ‘needs’ to actors which areseemingly either unconditioned by processesof institutionalization or unequivocally welldisposed to them. A widely canvassed remedyfor this limitation is to emphasize the role ofinterests, instrumental action and/or rationalchoice (Alexander, 1983; Silverman, 1970).In this remedy we encounter an example of aflip-flopping between (functional) structural-ist and action-theoretic accounts of socialaction. The dynamic of the flip-flop dependsupon each pole being simultaneously recog-nized and denied as one or other side of the dualisims privileged, and subsequentlyfound to be unbalanced by advocates of thealternative pole. So, for example, Parsons’systems-theoretic conceptualization of insti-tutionalization is censured for assuming amodel of human action in which compliancewith moral authority is governed by the


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‘need’ to internalize its order(s) rather than,say, a calculation by agents that involves thestrategic development of, or identificationwith, particular norms and values.

It is notable that mention of agency islargely excluded from Meyer and Rowan’s(1977/1991) classic paper where their rejectionof methodological individualism is clearly sig-nalled in the definition of institutionalization:

Institutionalized rules are classifications built intosociety as reciprocated typifications or interpreta-tions (Berger and Luckmann, 1966: 54). Such rulesmay be simply taken for granted or maybe sup-ported by public opinion or the force of law ...Institutionalization involves the process by whichsocial processes, obligations, or actualities come totake on rule-like status in social thought andaction. (Meyer and Rowan, 1977/1991: 42)

Writing from the structuralist pole of thedualism (see above), Meyer and Rowan omitreference to actors’ orientations and alsoexclude consideration of power in respect ofthe conditions of institutionalization as wellas its consequences, possibly because theyequate the conceptualization of power with anotion of one individual or group possessingthe power to secure their interests despite theresistance of others.

The development of neo-institutionaltheory has involved a rehabilitation of anotion of agency (and power and interests) soas to account for processes of change that, inpart at least, are attributed to the interven-tions of powerful agents (e.g. institutionalentrepreneurs and social movements, seeespecially DiMaggio, 1988). In order to fur-ther develop and deepen our reflections oninstitutionalization, we turn to Berger andLuckmann’s The Social Construction ofReality which has provided the theoreticalunderpinning and legitimacy for much insti-tutional theory (Gulrajani and Lok, 2005).

Institutionalization in ‘The socialconstruction of reality’

We begin by considering Scott’s reading ofBerger and Luckmann’s three moments in

the process of institutionalization, payingparticular attention to how ‘agency’ and‘power’ are formulated in their thinking:

Externalization – the production, in social interac-tion, of symbolic structures whose meaning comesto be shared by participants [in particular socialworlds, e.g. the world of institutional theory];Objectification – the process by which this produc-tion ‘comes to confront him as a facticity outside ofhimself’ as something ‘out there’, as a reality expe-rienced in common with others [e.g. the ‘institu-tionalisms’ to which Jepperson (1991: 144) refers].And only then comes Internalization – the processby which the objectivated world is ‘retrojected intoconsciousness in the course of socialization. (Scott,1995/2001: 40, emphases omitted and added,citing Berger and Luckmann, 1966: 60–61)

The emphasis on ‘facticity’, ‘out there’, ‘out-side of himself’ serves to counteract Parsons’functionalist accent on the moment of inter-nalization. On the other hand, Berger andLuckmann account for institutionalization interms of ‘the important psychological gain’(echoes of Parsons) that institutionalizationdelivers as it narrows choices and ‘therebyopens up a foreground for deliberation andinnovation’ (1966: 71). There is little or noconsideration of how, for example, the verysense of agency emerges through processesof institutionalization; or how, in Foucault’sterms, human beings become subjectified asthey/we are made into subjects through par-ticipation in such processes. Relatedly, thereis no appreciation of the ambivalence of the‘gain’ secured by habitualization (seeWillmott, 1986). As a consequence, whenconsidering the ‘controlling character’(Berger and Luckmann, 1966: 72) of institu-tionalization, Berger and Luckmann under-stand it as something that is ‘inherent’, andnot mediated by relations of power.

In conceiving of institutionalization asoccurring ‘whenever there is a reciprocaltypification of habitualized actions by typesof actors’ (1966: 72), Berger and Luckmannassume an unforced reciprocity in processesof habitualization which is based upon the‘psychological gain’ enjoyed by all parties:‘the most important gain is that each will beable to predict the other’s actions’ (1966: 74).


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Institutionalization is thus represented asuniversal and politically neutral. It is con-ceived as universal in the sense that it has nohistorical specificity: all forms of institution-alization are deemed to be equivalent. And it is politically neutral, if not amorallyconservative, in the sense that the (political)conditions and consequences of institutional-ization are excluded from its characteriza-tion. As Berger (1988: 223) has commented,those who read radicalism into his construc-tionism laboured under a ‘profound misun-derstanding’. Berger and Luckmann’sunderstanding of social constructionism canbe applied as readily to slave plantations, forexample, as it can to movements for the abolition of slavery without, in either case,making reference to the oppressive or eman-cipatory character of such institutions. Thereis barely a gesture9 towards the possibleinvolvement of more or less powerful actorsin establishing and imposing typificationsthat, over time, become habitualized andreciprocated or, at least, complied with. Nor,building on critical theorizing, is thereacknowledgment of the powerful, normaliz-ing effects that all forms of institutionaliza-tion – whether imposed or embraced – exert.

The reliance upon Berger and Luckmannfor theoretical inspiration and legitimationcombined with, at best, a loose coupling ofpower and processes of institutionalization intheir thinking, helps to account for why‘power’, let alone domination or oppression,is so weakly theorized in new institutionaltheory (see Perrow, 1985) and appears as an ‘add-on’ in neo-institutional analysis. As DiMaggio (1988: 3) comments, in some-thing of an understatement, the presence andsignificance of agency and power in institu-tional theory is ‘somewhat obscure’. They are obscured as a consequence of newinstitutional theory’s consensualist, conser-vative assumptions that are endorsed, if not inspired, by Berger and Luckmann’s conceptualization of institutionalization.Consensualist analysis encounters a problemwhen it comes to accounting for change, at which point neo-institutional theorists

have endeavoured to rehabilitate agency (andpower) to counteract the determining forceattributed to institutional pressures by newinstitutionalists. Doubting that change can beadequately explained by functionalist fine-tuning or endogenous shocks, neo-institu-tionalists have flip-flopped in the direction ofother catalysts – such as (powerful) institu-tional entrepreneurs or members of a socialmovement – as agents of change.

Agency and institutionalization

Inspired by DiMaggio’s (1988) critique ofnew institutional theory, neo-institutionalistanalysis is propelled by a taken-for-granted,and thus unexamined, assumption that‘agency’ must play some (important) part inprocesses of de/institutionalization and, morespecifically, is a source of diversity or cre-ativity that is productive of innovation andchange. A recurrent shortcoming of suchappeals to agency concerns their tendency tooverlook how ‘agency’ does not exist exter-nally to, but is itself a powerful product of,processes of institutionalization. This is evi-dent when ‘agency’ (and ‘interests’ and‘power’) are invoked by neo-institutionaliststo account for processes of institutionaliza-tion and de-institutionalization without suffi-cient attention being paid to the frameworksthat render their reality plausible and/or sup-port their adoption as explanatory variables.

Even if, as DiMaggio contends, ‘interestand group conflict’ is important for explain-ing ‘the processes by which institutionsemerge, are reproduced, and erode’, it shouldnot be conceived as external to institutional-ization. Unless a basic premise of institu-tional theory is to be abandoned or at leastseverely compromised, then ‘interests’ mustbe conceived as identified, whether by agentsor their observers, through processes that are institutionalized. The very claim that‘behaviour is driven by, and understandablein terms of, the interests of human actors’,for example, is not self-evident but, rather, an articulation of a particular institution that


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asserts and legitimizes the credibility of suchclaims. To put it another way, the claim is anarticulation of (hegemonic) power that oper-ates to define the world in a distinctive way(Friedland and Alford, 1991),10 to naturalizeand legitimate that which is institutionalized.

CRITICAL THEORY ANDNATURALIZATION OF THE PRESENT

Calling a theory ‘critical’ is, of course, aprovocation as it implies that other theoriesare ‘uncritical’. Yet all theory develops inrelation to some other theory against which,more or less overtly, it defines itself and takescritical issue. We noted earlier how variantsof institutional theory have established theirclaims by being critical of forms of un-institutional (e.g. rational choice and con-tingency) theory. To draw an authoritative orstable distinction between theories that are‘critical’ and others that are ‘uncritical’ isuntenable, not least because the sense andsignificance of their meanings shifts overtime (the Appendix examines this issue inrelation to critical theory; the other contribu-tions to this volume speak to the variety ofmeanings of institutional theory).

The signifier ‘critical theory’ is notrestricted here to the Critical Theory of theFrankfurt School such as Adorno, Marcuse,and Habermas (Held, 1980) but, rather, isinvoked to signal forms of thinking that provide a radical challenge to, as contrastedwith, an incremental refinement of, estab-lished conventions of thought and practice,with respect to their anticipated emancipa-tory impetus or potential. Thus, a chief target of critical theory is patterns of activitywhich, in different ways, naturalize the pres-ent – from Marx’s critique of political econ-omy to Derridean deconstructionism. Whatcritical theories share is a (value-based) con-cern to develop thinking with a practicalintent that may be broadly characterized as‘aimed at decreasing domination and increas-ing freedom’ (Stanford Encyclopaedia

<http:// plato,stanford.edu/entries/critical-theory>).11 The de-naturalizing intent of critical theories is generally motivated by a value-oriented conviction that the principalimport of knowledge resides in problematiz-ing conventional wisdoms and de-legitimizingestablished institutions so as to foster andfacilitate emancipatory change (e.g. the contribution of feminist knowledge to identifying and challenging patriarchal practices).

Consider, for example, how reference isroutinely or implicitly made to the ‘realworld’ without any acknowledgement of howthe ‘reality’ of this world is apprehended or,better, constituted, from a particular, histori-cally and culturally located, point of view. Inbusiness textbooks and journal articles aswell as in the classroom, the ‘real world’which is evoked is frequently, and more orless explicitly, the one presumed by a pointof view attributed to senior management – aview that tends to take for granted the neces-sity of the status quo, the legitimacy of exec-utives and academics privileged place within it and the heroism of all engaged inreproducing the system. This ignores a criti-cal understanding of the present world asdivisive and destructive, where the relentlessexpansion of capitalism is made possible, inpart, by its routine legitimation in social science and business school education12

(in which institutional theory plays its part).And yet, some residual, albeit barely

acknowledged, awareness of the selectivity,limitations and self-serving rationalizationinvolved in bodies of knowledge, such asthose constructed in business schools, is to be expected. Those engaged in reproduc-ing and consuming bodies of knowledge that naturalize the present ‘rarely experiencetheir oppressive character’, yet they ‘can feel that burdensome weight if they dare step outside the presuppositions of under-standing and the sanctioned forms of inference and presentation of “evidence” ’(Barnett, 1997: 17). Taking this ‘step outside’ is the invitation extended by our exploration of institutional theory from


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an alternative, critical theoretic standpoint.Our intent is to develop a picture of institu-tional theory less as an appealing and pros-perous research programme, and more as anexemplar of Kuhnian ‘normal science’ thathas contentedly settled down in the suburbiaof social theory (cf. Pollner, 1991). InKuhnian terms, we identify institutionaltheory as a ‘puzzle-solving’ activity within agiven (i.e., institutionalized) frameworkwhere any appetite for interrogating theunderlying tenets of the framework tends tobe marginalized or suppressed (Kuhn, 1970:especially p. 35). It is precisely this appetitethat critical thinking stimulates and feeds asit problematizes what it understands to havebecome naturalized, excluded or glossed. Aswe indicated earlier, our attentiveness to crit-ical thinking is highly selective, beingrestricted to a Foucauldian reading and cri-tique of institutional theory. Accordingly, weelaborate our understanding of Foucault’scritical thinking in the following sectionbefore applying it to examine a number ofkey contributions to institutional theory.

FOUCAULT, POWER/KNOWLEDGEAND CRITICAL THEORY

My role – and that is too emphatic a word – is toshow people that they are much freer than theyfeel, that people accept as truth, as evidence,some themes which have been built up at a certainmoment during history, and that this so-called evi-dence can be criticized and destroyed. To changesomething in the minds of people – that’s the roleof an intellectual. (Foucault, 1988: 10)

The directness of this quote suggests thatmany critics of Foucault – who assert that hisapproach is totalizing in its denial of subjec-tivity or that he is relativist or nihilist – aredifficult to sustain. This is not to deny that hiswritings are multifaceted and susceptible todiverse readings.13 Amongst the themes thatrecur in his writings are those on the natureof rationality, the relationship between truthand power and an examination of the dark

side of modernity. We focus largely on hiswriting on power and subjectification, anemphasis that Foucault (1983) himself retro-spectively identifies as central. In contrast toinstitutional theory, which points (ironically)to the mythical quality of rationality withoutsubjecting it to critique, ‘Foucault questionsthe rationality of post-Enlightenment societyby focusing on the ways in which many ofthe enlightened practices of modernity pro-gressively delimit rather than increase the freedom of individuals and, thereby, per-petuate social relations of inequality andoppression’ (McNay, 1994: 2). McNay’sobservation on Foucault’s scepticism about‘post-Enlightenment society’ and his atten-tiveness to the ‘freedom of individuals’ aswell as ‘relations of inequality and oppres-sion’ is indicative of a difference between hisposition and that of many other critical theo-rists (e.g. Frankfurt School); it also signalswhat distinguishes his thinking on the signif-icance of institutionalization. We considereach of these in turn.

Many advocates of critical analysis (aswell as positivists) assume the possibility ofestablishing foundational knowledge, eitherby applying scientific methodology (e.g.Bhaskar) or through counterfactual argumen-tation (e.g. Habermas).14 And, of course, thisgets Foucauldians into trouble, as well asothers who lean in a non-foundationalist15

direction, such as liberals like Rorty, withthose wedded to some particularism whichthey privilege as universalism – whether thisis spiritual or secular, or whether it is leftistor rightist, in inspiration. Non-foundational-ists regard the kinds of truth claims assertedby foundationalists not only as elusive but,when taken seriously, as potentially verydangerous. Notably, they are seen to harboura misplaced assuredness about truths which,at best, prop up the repressive/cynical toler-ance of liberal pluralism and, at worst,engender dogmatism and court the dangersof totalitarianism. The rejoinder to theassessment that, lacking any normative basisfor critique, non-foundationalism harboursrelativism and nihilism is that, ultimately, the


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authority of foundationalist critique reliesupon self-referentiality with regard to (partic-ular) assumptions and assertions about itsauthority that can be supported only by refer-ence to the very assumptions upon which itrelies. Acknowledging the limitations andhazards of all forms of thinking, criticalthinking included, is, despite the lack of cer-tainty, considered by anti-foundationalists tobe more defensible and/or to be of greatersocial value than to claim or assume that thereis some independent or non-self-referentialbasis for producing knowledge.

Non-foundationalism is a stance that takesus away from the quest for transcendental ornormative criteria that aspire to provide thedefinitive identification of what, for example,is (essentially) oppressive or emancipatory.Turning away from this alluring but treacher-ous fantasy, we are obliged to face up to ourreliance upon whatever ‘standards of ration-ality and justice are available to us within thespecific contexts in which we find ourselves’(Sawicki, 1994: 352). Such standards are notregarded as hopelessly flawed or useless inrelation to some higher ideal. Rather, their(limited) value and their (inherent) ‘danger-ousness’ is recognized (Foucault, 1984: 343).As Dreyfus and Rabinow (1986: 118) assessFoucault’s stance, it ‘has never been todenounce power per se nor to propound truthbut to use his analysis to shed light on thespecific dangers that each specific type ofpower/knowledge produces’. What, forFoucault is uniquely dangerous about moder-nity is that ‘everything becomes a target fornormalization’ (Hiley, 1988: 103). Such nor-malization, we argue, includes the study ofinstitutionalization.

Turning now to the question of Foucault’sdistinctive position on the nature and signifi-cance of rationality and institutionalization,we first note that, for institutional theorists,human action is infused by value in the formof ‘social entanglements and commitments’(Selznick, 1992: 232), the implication beingthat rationality is a myth, at least to the extentthat this infusion is unacknowledged (e.g. inrational choice theory). The (institutionalized)

idea of rationality is identified as a normativeimperative with which modern organizationsand their members conform to ‘increase theirlegitimacy and survival prospects’ (Meyerand Rowan, 1977/1991: 41). However, ininstitutional theory, this problematizing ofrationality is not connected to (ethical) issues(e.g. of freedom). Rather, the study of ration-ality is linked to questions of the (scientific)adequacy of forms of explanation. In Meyerand Rowan’s case, their analysis concludeswith three testable hypotheses. Likewise,DiMaggio and Powell (1983: 154) assess‘the ultimate value’ of their work in terms ofits ‘predictive utility’ and present a series ofhypotheses for empirical testing. In eachcase, the theory-laden nature of empiricalfindings collection/construction is unac-knowledged. A perspective that is latentlynormative (the value of predictive science) ispresented as descriptive or positive.

In Foucault’s study of rationality, the focusis on its ethical significance, not its status asa variable in the development of an empiri-cal-analytic science of prediction and con-trol. His focus is on what, loosely, may betermed the institutionalization and reproduc-tion of ‘inequality and oppression’ (McNay,1994: 2) that takes the form of routine andambivalent subjectification as well as moreovert and unequivocal subjection. There is no(scientistic) assumption or pretence thatsome objective measure of ‘inequality andoppression’ can be devised and applied.Instead, all truth claims, including those ofinstitutional theory, are understood to beembedded in, and subject to, evaluation byrelations of power-knowledge; and it iswithin the specificity of these relations thattheir meaning and significance is fashioned.Taking this stance, it would be inconsistent todiscredit as bogus or incorrect forms ofpower-knowledge that ascribe truth to thefindings of an empirical-analytical concep-tion of science preoccupied with hypothesistesting. Instead, Foucault’s approach com-mends critical reflection upon the particular(institutionalized) basis upon which seem-ingly authoritative, universal claims are


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founded; and it advocates close attentivenessto the (political) effects of believing suchknowledge to be true.

Power: juridical and disciplinary

A significant area in which Foucault hasopened up epistemological space is in thestudy of power where he challenges the nat-uralization of a view of power that conceivesof it as possessed by unitary, ‘sovereign’political (individual or collective) agents(Foucault, 1977, 1979a, 1979b, 1980). Sodoing, Foucault does not deny, or seek toinvalidate, the force of what he characterizesas the ‘juridical’ conception of power (seeFoucault, 1979a: especially p. 7 and 1994:especially p. 42 et seq). After all, he makesno assumption that power has an essencewhich conventional wisdom fails to mirror;instead, he problematizes its exclusivity byposing an alternative to the established,juridical view.16 That is, additionally, heinvites us to conceive of power as productiveof extensive, subjectifying processes of nor-malization – which he associates with thedevelopment of modern organizations andwhich he also understands to be ‘embodiedin the background of everyday practices’(Dreyfus, 2004). Foucault’s interest is notprimarily directed at the expression of powerin its most central and institutionalized formssuch as state apparatuses or class relations.Rather, he is concerned to examine howpower relations of inequality and oppressionare created and maintained in more subtleand diffuse ways through ostensibly humaneand freely adopted social practices. Thesesubtle practices can be deeply institutional-ized and taken for granted. In modern organ-izations, such as factories, offices and stateagencies, a juridical form of power exercisedfrom above is seen to depend upon, promoteand even be displaced by a ‘disciplinary’form of power that objectifies and institu-tionalizes social reality through processes ofnormalization and subjectification. It is thisshift in the conceptualization and analysis of

power that underpins the assessment that ‘Perhaps no writer of the last half cen-tury has done more to illuminate the natureof power than Michel Foucault’ (Wolin,1988: 179).

For Foucault, there are two related kindsof normalizing power: ‘disciplinary power’and ‘bio-power’. ‘Bio-power’ is at work inthe subjugation of human bodies; and thecontrol of populations by making clear whatis ‘normal’ and what is not. Normalizingeffects are articulated through discursive for-mations such as psychiatry, medicine, man-agement and social work. ‘Disciplinarypower’ renders specific individuals or groupsof people orderly and regimented through thedevelopment and use of technologies ofassessment and surveillance – technologiesthat became widely disseminated throughorganizations and institutions. Disciplinarypower is conceived to operate ‘through a multiplicity of organisms, forces, energies,materials, desires, thoughts, etc.’ (Foucault,1994: 35). Such power, Foucault contends,‘must be analysed as something which circulates ... It is never localized here orthere, never in anybody’s hands, never appropriated as a commodity or piece ofwealth. Power is employed and exercisedthrough a netlike organization’ (Foucault,1994: 36). Moreover, disciplinary power is not exclusively negative or zero-sum; it isproductive, not just repressive; it is diffuseand relational. It is also subjectifying, inasmuch that it constitutes subjects as individuals:

power produces; it produces reality; it producesdomains of objects and rituals of truth. The individ-ual and the knowledge that may be gained of himbelong to this production. (Foucault, 1984: 204–5,emphasis added).

Amongst these ‘domains of objects’ is thesense of agency attributed to, and demon-strated by, subjects. This could imply thatFoucault’s concept of subjectification isequivalent to the more established, sociolog-ical idea of socialization. But this is to jumpto an unsupportable conclusion, as Dreyfus(2004) observes,


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Socialization into norms is the universal way theunderstanding of being or power governs theactions of the members of any society. .... how-ever, norms are progressively brought to bear on‘all aspects of life’... normalization works directlythrough new sorts of invisible, continuous prac-tices of control Foucault calls micro-practices ...disciplinary power works meticulously by orderingevery detail. So, while for Foucault all forms ofpower are bottom up and the understanding ofpower as monarchical misses this important fact,nonetheless bio-power is bottom-up in a new anddangerously totalizing way, so that understandingpower on the model of the power of the rulercovers up an important change in how our prac-tices are working.

Crucially, knowledge and power do not existindependently of each other:

there is no power relation without the correlativeconstitution of a field of knowledge, nor anyknowledge that does not presuppose or constituteat the same time power relations ... it is not theactivity of the subject of knowledge that producesa corpus of knowledge, useful or resistant topower, but power/knowledge, the processes andstruggles that traverse it and of which it is madeup, that determines the forms and possibledomains of knowledge. (Foucault, 1977: 27–28)

Foucault draws us towards analysis thatstrives to appreciate the terms, and moreespecially, the effects, of particular dis-courses with regard to how they articulateand sustain a ‘regime of truth’ such that aparticular ‘object of discourse’, or socialobjectivity, is successfully institutionalized.Foucault’s attentiveness to power/knowledgeexplores how it is productive of subjects whoare normalized through the operation of‘micro-practices’ that regulate numerousaspects of their/our everyday lives.Technologies of power (that include manage-ment practices such as accounting and infor-mation systems) not only aspire to identify,monitor and control numerous aspects of life,but, crucially, provide a seductive regime oftruth for governing subjects who come tocomply with its disciplinary logic.

Yet, for Foucault, the effect of power’soperation is by no means totalizing as it oper-ates upon recalcitrant material (humans) – as,for example, when the ‘objects’ of discipli-nary technologies respond by ‘gaming the

system’ or simply refusing to act in a respon-sive, disciplined manner. As Foucault (1978:95) puts it, ‘where there is power, there isresistance’. Exercises of power are thereforeendemically vulnerable to both overt andcovert resistance that challenges, and mayultimately displace, its ‘truth’. The effects ofjuridical as well as disciplinary power are indeterminate as they are contingent uponits dispersed targets – the ‘individual or collective subjects who are faced with a fieldof possibilities in which several ways ofbehaving, several reactions and diverse com-portments may be realized’ (Ezzamel, 1994: 221).

We have noted how both ‘old’ and ‘neo’versions of institutional theory incorporateelements of a juridical, top-down conceptionof power as they invoke notions of agencyand interests to account for processes ofde/institutionalization. There is, however, noequivalent to ‘disciplinary power’ in institu-tional theory. This is not entirely surprisingas a focus upon subjectification is farremoved from the normal science value-ori-entation of institutional theory which focusesupon ‘enduring elements of social life’, suchas ‘logics’ (Lawrence and Suddaby, 2006:215) rather than the particularity of their sub-jectifying effects17 (but see Lok, 2007 andKhan, Munir and Willmott, 2007 for exam-ples of how Foucauldian thinking may beintroduced into the examination of processes,e.g. institutional entrepreneurship typicallystudied by institutional theorists).

Power and subjectification

To recap, what institutional theorists charac-terize as ‘institutionalization’ can alterna-tively be understood from a more critical,Foucauldian standpoint as ‘normalization’,where human beings become bound to theidentities to which they/we are subjected.Foucault is distinctly attentive to the discipli-nary processes through which subjects areconstituted as an effect of participation insocial institutions, as contrasted to the


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(juridical) establishment and enactments ofsovereignty by one group over another.Notably, when discussing how the humansciences have developed alongsidepower/knowledge technologies invested indisciplinary institutions (the prison, the fac-tory, the school, etc.), Foucault (1979b: 305)links power with the subject, and drawsattention to specific forms (modalities) ofpower:

a certain policy of the body, a certain way of ren-dering the group of men docile and useful. Thispolicy required the involvement of definite rela-tions of knowledge in relations of power; it calledfor a technique of overlapping subjection andobjectification; it brought with it new proceduresof individualization. ... Knowable man (soul, indi-viduality, consciousness, conduct, whatever it iscalled) is the object-effect of this analytic invest-ment, of this domination-observation.

In everyday activities and routines, normaliz-ing power constitutes subjects as agents towhom sovereignty is attributed as a ‘naturalentity’, and to which interests are alsoascribed. Such discourse produces a sense ofself as a centred, autonomous decision-maker as well as self-affirming beliefs aboutthe location of power – either as a possessionof subjects (agency) or as an enabling/dis-abling constraint on agency (structure). In hislater works. Foucault turned his attentionmore directly to strategies of resistance andthe production of alternative discourseswhose aim is to challenge dominant dis-courses of power, including technologies ofself (Foucault, 1988), at a particular juncturein time and space (see also McWhorter,1999). Power is conceptualized as a networkof relations, rather than as juridical or sover-eign. The effects of its operation are con-ceived as ambivalent and unpredictable butalso potentially ‘dangerous’ as they areappealing, yet can have unintended, malig-nant as well as beneficial consequences.These effects include the ambivalent capaci-ties of agency in which subjects becomeabsorbed: ‘all subjectifying power endowssubjects with some capacities required to be agents, even when it is oppressive’

(Simons, 1995: 82). For Foucault, institu-tions are not benign; nor are they mere objectsof analysis; they are mobile complexes ofjuridical and disciplinary power. Disciplinarymechanisms have power effects as they sort,rank, homogenize, differentiate, individualize,and produce the rules that are at once bothinclusive and exclusive of populations of indi-viduals. Foucault is attentive to the productiveand insidious effects of power, and to theresistance that discloses the limits of power.

To recap key elements of our argument, we have identified institutional theory’s con-ceptualization of institutionalization as preoccupied with explanation rather thanemancipation, and as methodologically col-lectivist and tendentially consensualist with atendency to revert to methodological individ-ualism, where change is attributed to wilfulagency that is in possession of some kind ofpower. A key difference between Foucault’sapproach to the study of power and that ofinstitutional theorists is the central concern tohighlight the operation of unacknowledgedprocesses of domination and oppression inthe guise of normalization and subjectifica-tion. In Foucauldian analysis, power, con-ceived as disciplinary as well as juridical, isnot treated as a ‘bolt on’; and agency/struc-ture dualism is problematized by understand-ing it as a naturalized product of a particularpower/knowledge complex that frames somuch ‘normal’ social scientific discourse.

With a few exceptions (e.g. Knights, 1992;Townley, 1993; Ezzamel and Willmott,1998), the important Foucauldian insightsdiscussed above have hardly received anyattention in the mainstream organization liter-ature. By way of illustrating the contributionthat Foucault’s work can offer to organizationstudies we briefly discuss the work ofKnights and Townley, and refer to less well-known, critical literature.

Knights (1992: 515) draws on Foucault’swork to disrupt ‘knowledges that are built onrepresentations deeming to reflect reality’.Examining the study of strategy from aFoucauldian standpoint, Knights notes howpositivistic studies of strategy objectify


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businesses and their practices, whilst being‘oblivious to how their representations actu-ally constitute the subjectivity of manage-ment, as practitioners draw upon these studiesin their exercise of power’ (Knights, 1992:523) such that particular features of strategicdiscourse could be self-fulfilling in theireffects. Knights (1992: 529) emphasizes theconstitutive power of discourse by arguingthat ‘strategic discourse and practice repre-sent a set of power-knowledge relations thatconstitutes the subjectivity of managers andemployees’.

Townley (1993) draws on Foucault to present human resource management (HRM)as ‘the construction and production of knowl-edge’, and as a way of ‘rendering organiza-tions and their participants calculable arenas,offering, through a variety of technologies,the means by which activities and individualsbecome knowable and governable’ (1993:526, original emphasis). She shows how thedisciplinary technologies of HRM governpopulations of employees, in particular thedistribution of individuals into work space,their spatial enclosure, their partitioning fromeach other, their ordering into hierarchicalpositions, as well as the use of temporal(timetable) examination, and confessionaltechnologies to construct the subjectivity ofemployees and to render them calculable,analyzable and governable. Townley (1995)extends this analysis to examine the discipli-nary effects of technologies of accountingand performance measurement. Her work hasbeen developed by Covaleski, Dirsmith,Heian and Samuel (1998) in their Foucaudianexamination of HRM practices in accountingfirms, by Ezzamel and Willmott (1998) intheir examination of teamwork in manufac-turing, and by Grey (1994) in his analysis ofthe disciplinary effects of conceiving one’swork as a ‘career’.

There has also been considerable researchusing Foucaudian concerns about the disci-plinary power of management practices suchas accounting. Notably, Miller and O’Leary(1987) conduct an historical analysis to showhow scientific management and standard

costing produced ‘governable persons’.Hoskin and Macve (1988) and Carmona et al.(2002) similarly use historical methods toshow how the inter-connection betweenpower and knowledge produced modern conceptions of management. Field researchas diverse as Knights and Collinson (1987),Preston, Cooper and Coombs (1992) andEzzamel, Lilley and Willmott (2004) illus-trate the insights derived by examining disciplinary processes of subjectification andthe construction of specific conceptions of organization and management. Finally, the empirical studies of Haigh (2006),Preston, Cooper, Scarbrough and Chilton(1995) and Kosmala MacLullich (2003) indicate how the analysis of normalizationcan be applied to investment, ethical andaudit practices.

Space limitations do not permit us toengage with these illustrations in more detail,nor to comment on the extent to which weendorse their readings of Foucault. Rather,their work is cited here as examples of howFoucault’s work can be usefully extended toareas of organization studies as an alternativeway of seeing, rather than as a replacementor corrective, to other research approaches.In the following section, we examine in somedetail some of the recent attempts made inthe organizational literature to refine institu-tional theory and comment on the extent towhich such attempts are commensurate withour reading of Foucault’s work.

THE LIMITS OF REFININGINSTITUTIONAL THEORY

We now apply our reflections on institutionaltheory, critical thinking and Foucauldiananalysis – to consider the interventions byadvocates of institutional theory who havepointed to, and proposed ways of overcom-ing, its limitations. Initially, we elaborate andsupport our claim that neo-institutionalistanalysis relies upon deinstitutionalized con-ceptions of agency and related, juridical


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understanding of power. We then examinesome examples of how critical thinking,including Foucauldian ideas, has been intro-duced into institutional analysis.

Incorporating agency, interest andpower? DiMaggio, Oliver, Meyerand Jepperson

Amongst the more influential reformers ofinstitutional theory are DiMaggio (1988) andOliver (1991; 1992). DiMaggio (1988: 3)calls for incorporating ‘the role of interestand agency’ as a corrective to an analysis‘predicated on the assumption, oftenimplicit, that persons and organizations hold,and act on, universal interests in survival andin the reduction of uncertainty’. Oliver(1991) follows this lead as she commendsresource dependency theory in order to pay‘attention to the role of organizational self-interests and active agency in organizationalresponses to institutional pressures andexpectations’ (1991: 45). The intent of theseinterventions is to acknowledge and under-stand how ‘institutionalization is a product ofthe political efforts of actors to accomplishtheir ends’ (DiMaggio, 1988: 13), with aview to extending the capability and reach ofinstitutional theory in relation to its study of‘strategic responses to the institutional envi-ronment’ (Oliver, 1991: 151).

Revisions to institutional theory thatattribute change to the agency of actorsdepart, as DiMaggio (1988: 11) notes, fromthe understanding that institutional and inter-est-based frameworks are incommensurableor ‘antagonistic’ – a position which, for bothhim and Oliver, is seen to impede ‘the devel-opment of a more comprehensive theoreticalapparatus’ (1988). Such revisions are intro-duced as a remedy for what is regarded as therestrictive capacity of institutional theory ‘todevelop predictive and persuasive accountsof the origins, reproduction, and erosion ofinstitutionalized processes’ (1988, emphasisadded). In a similar vein, Oliver approvinglyquotes resource dependency theorists who

‘argue that organizational stability isachieved through the exercise of power, con-trol, or the negotiations of interdependenciesfor purposes of achieving a predictable orstable inflow of vital resources and reducingenvironmental uncertainty’ (1991: 149,emphasis added). In this turn to agency,exemplified in the work of both DiMaggioand Oliver, power is conceived as a posses-sion of agents which, when operationalized,is seen to render behaviour more predictableand thereby attenuate uncertainy. This orien-tation differs markedly from Foucault’s nor-malizing conception of power as a networkof relations whose outcome is indeterminate.In commenting upon this turn to the role of‘agency’ in the exercise of power, we focusupon two related issues. First, the compati-bility of its methodologically individualisticconceptualization of action with the founda-tional assumptions of institutional theory;and, secondly, the focus upon a juridical con-ception of power to the exclusion of otherconcepts of power, such as those articulatedby Foucault.

As Friedland and Alford (1991) incisivelypoint out, DiMaggio’s proposal to correct the ‘defocalization of interest and agency’(1991: 3) assumes a ‘materialist-idealistdualism’. This dualism is evident, for example, in the view ‘that actors have objec-tive interests, which can be understood inde-pendently of the actors’ understandings’(1991: 244) and to which, presumably, socialscientists have privileged knowledge andaccess. In such formulations, agency appearsto exist externally to, and to operate in some measure outside of, processes of insti-tutionalization. Thus, DiMaggio asserts that‘there is much about the processes by whichinstitutions emerge, are reproduced, anderode, that cannot be explained without ref-erence to interest and agency’ (1988: 3). InDiMaggio’s rehabilitation of agency withininstitutional theory, actors are susceptible tothe influence of institutions only when theirreal interests are adequately catered for, orare recognized by them.18 Oliver (1991) isless explicit about her conception of agency,


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although in drawing upon resource depend-ency theory, she relies on a juridical concep-tion of power: she does not conceive of theorganization, the environment, or, indeed, theperspective that differentiates them, as artic-ulations of power in the manner suggested byFoucault. The power attributed to organiza-tions appears to develop and be exercisedindependently of the institutional frameworkand processes through which organizationalpractices are enacted. These are the taken-for-granted ‘context’ against which power isexercised by actors pursuing their interests.In short, a basic limitation of bothDiMaggio’s and Oliver’s theoretical posi-tions is their ‘institution-free conception ofinterest and power’ (Friedland and Alford,1991: 244). The materialist-idealist dualismeffectively ‘defocalizes’ (using DiMaggio’sterminology), processes of institutionaliza-tion with respect to both what the signifier‘interests’ (and ‘agency’ and ‘power’) is intended to describe (its referent) and towhat it signifies (see Hirschman, 1986, citedin Friedland and Alford). Put bluntly, there isa lurch to methodological individualismwhere institutional entrepreneurs somehowevade or ‘escape the rules, routines, andnorms of institutional fields’ (Levy and Egan,2003: 811).

In pointing to this example of structure-agency flip-flopping in neo-institutionaltheory, we stress that DiMaggio’s andOliver’s proposed refinements seek to avoiddeficiencies attributed to (new) institutionaltheory, but suggest that their analysis resem-bles a version of action theory rather thanone that is institutionalist. Their conceptual-ization of power, self-interest and politicshighlights our earlier observations about theconservative value-orientation of institu-tional theory. For, despite Oliver’s character-ization of interests as ‘political’ (1991: 147),she treats politics as synonymous with bar-gaining, where the substance or issues beingbargained over are regarded as an ethicallyirrelevant feature of institutionalization.

Reliance on a juridical view of power, tothe exclusion of bio-power and disciplinary

power, is also evident in more recent work,where change is seen as a problem that is‘solved’ by identifying the agents who ‘must’possess power to change things – institutionalentrepreneurs or social movements. These‘powerful’ agents are said to establish some-thing that does not simply reproduce whatalready exists (Suddaby and Greenwood,2005), but whose ethical or political propertiesare irrelevant to such analysis. This approachexemplifies a mode of knowledge productionwhich aspires to capture, order, and reordersuch ‘objects’. Such (power-) knowledgeenhances the position of comparative sover-eignty of a certain class of actors (e.g. man-agers, technocrats) in identifying ‘better’(from their perspective) strategic responses to institutional pressures. A Foucauldianresponse to this endeavour is not necessarilyto deny the potential benefits of predictionand managerialism, per se, but rather toemphasise that belief in the possibility of pre-dicting the outcome of power is conditionalupon the exclusion of a conceptualization ofpower as a network of relations, or problema-tizing the ethical rights of managers.

Turning to the work of Meyer and Jepperson(2000), they valuably remind us that the mean-ing and significance of terms such as agencyand interests is neither self-evident nor intransi-tive. Rather, such terms are articulations of acultural system in which ‘the modern actor [isconstructed] as an authorized agent for variousinterests via an ongoing relocation into societyof agency originally located in transcendentalauthority’ (2000: 100). Meyer and Jeppersoneffectively admonish those who appeal toagency or interests – for example, in order toexplain processes of institutionalization – whenthe appeal to agency fails to recognize how anyconception of agency relies on a set of ‘precon-scious understandings’ (DiMaggio, 1988: 3)that modern actors come to acquire and broadlyshare. This critique is subtly articulated whenMeyer and Jepperson deconstruct the taken forgrantedness of agency and ‘agenticness’ in somuch social and organization theory:

Most social theory has recognized one way oranother that core social entities have been more


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elaborately constructed over time. The agenticaspect and its underlying spiritual devolution is lesswell recognized. Modern individuals, organizations,and nation-states, in becoming legitimated agentsfor their underlying interests, incorporate the highlystandardizing responsibility to enact imaginedmoral and natural principles. The proper, modernagentic individual, for instance, manages a life, car-rying a responsibility not only to reflect self-interestbut also the wider rationalized rules conferringagency ... Modern agentic actors involve them-selves in all sorts of efforts elaborating their agentic capabilities. (2000: 107, emphasis added)

Here we have a strong and timely reassertionof the distinctive, central idea of institutionaltheory that the key to understanding humanbehaviour is the manner and process of itsinstitutionalization. They recall that the‘proper, modern, agentic individual’ is aproduct of a particular institution that consti-tutes and legitimizes their/our sense ofagency and associated responsibility for theenactment of ‘imagined moral and naturalprinciples’ (2000), including the seemingnaturalness of self-interest and the preoccu-pation with its preservation and pursuit.

Given that Meyer and Jepperson questionthe way in which agency has been attendedto in institutional theory, it is disappointingthat, despite their observations on modernactorhood – which they helpfully associatewith ‘European efforts’ and particularly withFoucault’s emphasis on how specific featuresof actorhood are generated by specific insti-tutional structures (2000: 102, note 3) – theypay no attention to Foucault’s thinking onpower and knowledge. One way to interpretthis silence is to understand their analysis asa sophisticated restatement of an establishedconservative conception of institutionaltheory. What, in neo-institutionalist analysis,appears to escape the operation of institution-alization is understood by Meyer andJepperson to be a product of ‘deeply held,unexamined logics’ that currently form theframework ‘within which reasoning takesplace’ (Horn, 1983: cited by Suddaby andGreenwood, 2005: 37).

Meyer and Jepperson’s (2000) argument is a potent rejoinder to those who contend

that agency, for example, is external to, and operates in some measure outside of,processes of institutionalization. But Meyer and Jepperson have virtually nothingto say about power or hegemony, and in this sense their contribution is radically conservative in the tradition of Berger andLuckmann (1966).

From agency to contradiction? Seo and Creed

Seo and Creed (2002) take up and amplifyMeyer and Rowan’s observation (1977/1991)that gaining legitimacy by conforming toprevailing logics within the institutional fieldcan be damaging for efficiency and socialreproduction, notwithstanding possibilitiesfor a loose coupling between logics andaction. They formulate this insight as contra-dictions in a way that builds upon Friedlandand Alford’s (1991) thesis that contemporaryWestern societies are organized on, andthrough, diverse and contradictory logics,such as those of capitalist enterprise, familyvalues, democratic principles, etc. Theyargue that it is disjunctures within andbetween these logics that prompt agents toact in ways that produce change.

Seo and Creed’s (2002) work engagesdirectly with critical theory which, as theynote, ‘raises concerns about the possibilitiesof dominance and alienation in the processesof institutionalization that are seldom dis-cussed in the managerialist treatments ofinstitutional phenomena’ (2002: 241). Theyalso observe that institutional theory, in con-trast, ‘treats rules, logics of action, and insti-tutionalized patterns of behaviour ... assomething neutrally embedded withinpeople’s cognitions and/or as external givensof the broader society’ (2002). This assess-ment echoes our earlier reflections on the divergent value-orientations of criticaland institutional theory, and our commentson the latter’s consensualist and conservativeleanings.


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To explore the operation and significanceof contradictions for analyzing change, Seoand Creed commend a dialectical version ofcritical theory (Benson, 1977). But theysimultaneously cling to a neo-institutionalist,juridical conception of agency and power.Processes of institutionalization are under-stood to involve ‘political struggle involvingvarious participants who have divergentinterests and unequal power’ (2002: 229,emphasis added). A juridical attribution ofpower is assumed that excludes considera-tion of its hegemonic and net-like operation.Echoing DiMaggio (1988), they contend thatchange is instigated by agents when their‘ideas and interests are not adequately servedby the existing social arrangements’ (2002:229). Such ideas and interests are presentedas ‘givens’ that are self-evidently in a relationof more or less tension with ‘given’ socialarrangements. There is no consideration ofhow the identification of interests, or of the‘needs’ that are ‘unmet’ (2002: 229), or theassessment of existing arrangements is medi-ated by (contradictory) processes of institu-tionalization.

Seo and Creed’s contribution to the refine-ment of institutional theory usefully pointstowards contradictory, rather than simplycompeting, forms of institutionalization.Perversely, their use of critical theory to pro-vide an explanation of change directly con-tradicts what they initially identify as ‘one ofthe most central assertions in institutionaltheory – that actors and their interests areinstitutionally constructed’ (2002: 222–3,emphasis added). Seo and Creed’s ‘dialecti-cal perspective’ aspires to show how contra-dictions in and between institutionalarrangements induce the realization of trans-formative agency such that agents’ latentinterests are expressed through processes ofinstitutional change. While this is a com-mendable attempt to address the paradox ofembedded agency, Seo and Creed fall backon essentialist, or at least de-institutional-ized, notions of ‘need’ and ‘interests’ in theirconception of agency that are somehow transcendent of their institutional(ized)

formation and identification involvingprocesses characterized by Foucault as subjectification.

Foucault at last? Lawrence, Winnand Jennings

The distinctive way in which Foucault con-nects the exercise of disciplinary power to the process of subjectification is central toLawrence et al.’s (2001) examination of ‘theset of power relations that support the process [of institutionalization]’ (2001: 629).As they put it, ‘the power of discipline ... pro-vide(s) the basis for agency in the form ofidentity’ (2001: 636). Identity is understoodto precede agency, and is not theorized assomething that is chosen by (autonomous)agents. Contrasting disciplinary power with‘influence’, which is conceived as being con-cerned with ‘shaping a subject’s actions’(2001: 636), processes of institutionalizationgoverned by disciplinary power are under-stood to ‘shap(e) the actual formation of thesubject’ (2001: 636) and to be involved in ‘theconstitution of their targets’ subjectivity’(2001: 636). While this is useful, preciselywhat is involved in such ‘constitution’receives no attention beyond a cursory anddescriptive reference to Foucault’s observa-tions concerning the role of hierarchicalobservation, normalizing judgement andexamination in ‘maintaining power relations’(2001: 636) through the shaping of subjects’formation. Their relevance of these observa-tions for developing an alternative view of thenature and significance of institutionalizationis unexplored. Instead, Foucault’s ‘disciplinarypower’ is taken up to analyze the temporaldimension of institutionalization processes.More specifically, ideas drawn fromFoucault’s Discipline and Punish (1977) aredeployed to populate one cell within a 2 x 2typology of power-centred mechanisms ofinstitutionalization, which is distinguished by its generation of comparatively slow andstable processes of institutionalization (seefig. 2, p. 630 and Propositions 3a and 3b).


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Lawrence et al. (2001) claim that modes ofpower target either ‘subjects’ or ‘objects’when, arguably, it is always subjects that aretargeted and subjectified by discipline, evenwhen their subjectivity is disregarded (as inthe case of the power-knowledge effects ofactuarial tables or standard costs). From aFoucauldian perspective, actors rarely have‘no choice’ (2001: 631), as Lawrence et al.contend. Disciplinary power is not distin-guished from juridical power by the attribu-tion of choice to those who are subjectifiedby it. It may be the case, as Simon (1988)contends, that ‘Where power once sought tomanipulate the choice of rational actors, itnow seeks to predict behaviour and situatesubjects according to the risks they pose’(1988: 772, cited by Lawrence et al., 2001:637). But, as we argued earlier, this does notexclude consideration of the ways in whichsubjects become knowledgeable about suchchanges and seek to resist them.

Frustratingly, what we encounter inLawrence et al.’s application of Foucault’sthinking is an example of how, in the lan-guage of institutional theory, rhetoric isdeployed [by academic entrepreneurs] toaccommodate and align some new ideas [inthis case, Foucauldian ideas] to an estab-lished, taken-for-granted mode of compre-hensibility (see Suchman, 1995; Suddaby andGreenwood, 2005) that strips Foucauldiancritical theory of some of its most provocativeand original insights. Their domestication of critical thinking is brought home in theconcluding section of their article where it isconjectured that contemporary processes ofrationalization ‘involve a movement awayfrom institutionalization through influenceand force and towards discipline and domina-tion’ (Lawrence et al., 2001: 641) withoutconnecting this development to processes ofsubjectification.19 Moreover, the implicationsof this shift for researching institutionaliza-tion are framed not in terms of the effects of aputative shift to discipline and domination onsubjects but, rather, in a neo-positivist con-cern with the question of the ‘resources orabilities ... needed on the part of agents to

employ each of the four types of institutionalmechanisms’ (2001: 641). In short, it is busi-ness as usual for institutional theory.

CONCLUDING REMARKS

Our reflections on ‘Examining Institutional-ization’ are premised on the understandingthat accounts of the world generated by insti-tutional theory and critical theory are contin-gent upon the value-orientations in whichthey are embedded. We have pointed to somelimits of institutional theory, not with a viewto correcting or enhancing it but, rather, toshow how it articulates a particular, value-oriented form of power/knowledge; and,relatedly, to suggest that it does not have amonopoly of truth over the nature and signif-icance of institutionalization.

We have argued that institutional theoryunderstands institutionalization as a univer-sal and politically neutral process, albeit onewhere juridical conceptions of ‘agency’,‘power’ and ‘interests’ are increasinglyinvoked to account for the emergence ordemise of institutions. Even though institu-tional analysis conceives of organizations asvalue-imbued human constructions, ratherthan as impersonal, rational entities, its focusis on how institutions constrain and facilitateorganizational forms and practices, and notupon how institutions, dominate and oppressas they subjectify human beings. It is guidedby a conception of knowledge production inwhich there is a (positivist) emphasis uponprediction and control, as manifest in a pre-occupation with the identification and meas-urement of variables, including the powerattributed to agents, that are deemed to pro-vide a more complete explanation of howorganizational forms converge and change.Institutional theory, we contend, is institu-tionalized within a tradition of normal sci-ence which assumes an incrementalist andimperialist conception of theory develop-ment, inspired by the belief that it should bepossible to devise one, single, universally


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valid theory that successfully incorporatesand integrates every possible relevant element.

The particular value-orientation that pro-pels and legitimizes critical theory, in con-trast, produces knowledge that aims to‘denaturalize the present’, and therebyprompt and facilitate processes of emancipa-tion.20 Consistent with this impulse, we haveengaged critical theory to problematize theinstitutionalization of institutional analysisrather than to revise or replace its distinctivepower/knowledge framing of institutional-ization. Specifically, we have suggested therelevance of Foucault’s discussions of disci-plinary forms of power and processes of sub-jectification for thinking critically about howto study institutionalization.

In applying a critical, Foucauldian, read-ing to the central tenets and some key texts ofinstitutional theory our position is that thereis nothing inherently unacceptable aboutdefining and accounting for institutionaliza-tion in a particular way or, indeed, in manydifferent ways. Nor is there anything insup-portable in the ambition to develop morerobust, normal science explanations of insti-tutionalization so long as the contingency ofthe definition is fully acknowledged and sub-sequently recalled. Our point is that what ispresented, and what is counted, as ‘plausible’or ‘adequate’ is not a reflection of the corre-spondence of a particular approach with whatit aspires to refer to or ‘capture’ but, rather,its resonance with available, and perhapsdominant, discourses to which it is heard tocontribute in an affirming or disruptivemanner. To articulate this argument in termsmore familiar to institutional theorists:

actors employ rhetorical devices to connect ele-ments of the existing or proposed [meaning] tobroader cultural understandings in order to sup-port or challenge the comprehensibility of a [defi-nition]. (Suddaby and Greenwood, 2005: 41,emphasis added)

We have emphasized how institutional theory advances an important alternative tomethodologically individualist analysis butwe have also argued that, in this process,

it uncritically deploys dominant ‘culturalunderstandings’ to present a benign and totalizing understanding of institutionaliza-tion in which, for example, the institutional-ization of agency is unaddressed. We havealso noted how recent discussion of institu-tionalization has centred on the question of how the theory might be enhanced by remedying a perceived neglect of inter alia‘agency’, ‘power’, ‘interests’, ‘inequality’,‘meaning’ (e.g. Beckert, 1999; Whittington,1992; Zilber, 2002; Lounsbury andVentresca, 2003; Phillips, 2003) where it isassumed that any shortcoming identified ininstitutional theory can be corrected byapplying a restitutive patch in a way that willnot transgress or compromise its particular-ity. But these interventions have not reflectedon how the particularity of institutionaltheory has permitted or spawned such limita-tions. A consistently institutionalist perspec-tive, in contrast, could be expected toconceive of ‘agents’, and whatever is attrib-uted to them (e.g. ‘interests’ and ‘power’) as embedded manifestations of processes of institutionalization, and as existing exter-nally to such processes. What Meyer, Boliand Thomas (1987: 13, quoted in Scott,1995/2001: 42) have observed of ‘mostsocial theory’ would seem to be no less appli-cable to neo-institutionalist analysis:

Most social theory takes actors (from individuals tostates) and their actions as real, a priori, elements.... [in contrast] we see the ‘existence’ and charac-teristics of actors as socially constructed and highlyproblematic, and action as the enactment of broadinstitutional scripts rather than a matter of inter-nally generated and autonomous choice, motiva-tion and purpose.

Meyer et al.’s (1987) commentary invites the development of a more institutionallygrounded analysis of agency (and subjectifi-cation) that has not been taken up by institutional theorists. Foucault’s thinkingresonates, as Meyer and Jepperson (2000, note 3) note, with the institutionalistunderstanding that actors’ ‘characteristics’are ‘socially constructed and highly problematic’. But there is nothing equivalent,


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in institutional theory, to the Foucauldianview that everyday processes of institutional-ization exemplify a disciplinary form ofpower that is productive yet also dangerousin respect of its subjectifying effects. In insti-tutional theory, disciplinary power is eitherunrecognized or domesticated (Lawrence et al., 2001). Agency is displaced by a focusupon ‘broad institutional scripts’ (new institutional theory) or it is treated as the locus of a previously missing variable,in the form of power that is believed toenhance its explanatory capability. This isillustrative of how ‘old’, ‘new’ and ‘neo’institutional analysis tends to flip-flopbetween ‘structure’ and ‘agency’.

When faced with anomalies within institu-tional theory, such as the paradox of embed-ded agency, some institutional theorists haveturned to critical theories – for example, inorder to support efforts to pay greater atten-tion to issues of inequality and conflict(Hirsch and Lounsbury, 1997; Lounsburyand Ventresca, 2002, 2003). However, thebelief that elements of critical theory mightbe incorporated to develop a less partialaccount of aspects of institutionalizationlabours, in our view, under a misapprehen-sion. Critical theory does not offer an ‘addi-tive adjustment’ to other theories (Kuhn,1970: 53). Instead, it advances alternative,more radical, ways of representing thenature, and especially the significance, ofprocesses of institutionalization. That institu-tional theorists have largely ignored, or oth-erwise dismissed critical theory, includingthe thinking of Foucault (e.g. Hirsch andLounsbury, 1997: 412; Lounsbury andVentresca, 2003: 464), does not, for us, implythat an opportunity to refine institutionaltheory has been missed. Rather, it reflectsand affirms our thesis that institutionaltheory and critical theory offer alternative,value-oriented ways of representing thesocial world, including the nature and signif-icance of institutionalization.

That said, a more fully institutionalistunderstanding of knowledge, including‘agency’, can prompt a shift in the direction

of more critical thinking. In one of their moreradically phenomenological moments,21

Berger and Luckmann (1966: 82) cautionthat ‘great care is required in any statementsone makes about the “logic” of institutions’.Why do they urge this vigilance? Because‘the logic [of institutions] does not reside inthe institutions and their external functional-ities, but in the way these are treated inreflection about them’ (1966). What is con-ceived, or passes, for the logic of institutionsis inescapably an articulation of a particular(value-oriented) discourse – such as institu-tional or critical theory – not a reflection ofthe social practices that are representedthrough these discourses. The dimming ofthis insight – that ‘reflective consciousnesssuperimposes the quality of logic on theinstitutional order’ (1966) – results in, ormakes possible, the dominance, if notmonopolization, of the representation ofinstitutions and institutional theory by a formof analysis that is positivistic and conserva-tive in tenor. This dominance is reflected inthe absence of engagement with, or selectiveappropriation of, critical theory by institu-tional theorists.

In institutional theory, a posture of schol-arly inquisitiveness towards whatever illumi-nation critical theory might bring has beenexceptional. Institutional theorists haveseemed reluctant to pay critical theory con-centrated attention – perhaps because of anintuition that it could throw up some destabi-lizing anomalies or ‘inconvenient facts’, andthus ignite a process of theoretical reflectionand reassessment which would be counter-productive to the business-as-usual, ‘puzzle-solving’ modality of much institutionaltheorizing (Kuhn, 1970: 35). Institutionaltheory is perhaps, as Jepperson (1991) hints,something of a prisoner of its own, distinc-tive institutional(izing) logic(s); and, in thisrespect, its analyses run the risk of:

becoming ideologies of the institutions they study.Foucault has pointed to the double relationbetween truth and power, between forms of knowledge and power relations ... (Foucault, 1980). When social scientists import the dominant


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institutional logics into their analyses of individualsand organizations in unexamined ways, they unre-flectively elaborate the symbolic order and socialpractices of the institutions they study. These elabo-rations subsequently become factors in the repro-duction of these institutions. (Friedland and Alford,1991: 260)

That there is limited critical reflection withininstitutional theory, as Jepperson (1991) andFriedland and Alford (1991) point out, maynot be a problem for institutional theory. To the contrary, we interpret this restrictionas contributing to institutional theory’sappeal and influence as it suppresses consideration of the ethics, institutonalizedas a value-orientation, of knowledge produc-tion. For us, the boundedness of criticalreflection is a problem of institutional theory. If critical reflection were more ener-getically engaged, it would threaten the verytaken-for-grantedness of institutional theorywith respect to the ‘theoretical strategies’(Jepperson, 1991: 143) that give it distinc-tiveness and ensure its future reproduction.Critical theory illuminates how institutionaltheory ignores power; how neo-institutionaltheory incorporates it in an inconsistent way;and shows that neither variant is in a positionto appreciate the subjectifying effects ofinstitutionalization.22 By de-naturalizing theanalysis of institutions and processes ofsocial ordering constructed by institutionaltheory, critical theory opens up the possibil-ity of alternative forms of institutional analy-sis, including a Foucauldian attentiveness tosubjectification.

In addressing the question of what valuecritical thinking has for students of institu-tionalization, our answer has been that it isless germane as a resource for supplyingideas or fixes for shortcomings detected ininstitutional theory. Rather, a way of devel-oping some critical distance from which to appreciate the particularity and limits of institutional theory. Appreciating the dif-ferences between institutional theory andcritical theory avoids strained, contradictoryand confusing efforts to incorporate elementsof critical theory into institutional theory.

They each challenge the authority of individ-ualist, rational choice forms of analysis. Butthe forced integration or selective appropria-tion of elements of critical theory to patch upweaknesses in institutional theory risksdevaluation of their distinctive value-orienta-tions and associated contributions to knowl-edge. Respecting and preserving thesedifferences serves to enrich our understand-ing and, more specifically, impedes any ten-dency for a particular conception ofinstitutionalization to become totalizing (Lokand Willmott, 2006). It is when criticalreflection upon the totalizing tendencies ofinstitutional theory is absent that it presentsan obstacle to the development of other, critical forms of analysis as it paints them as ‘politically charged’ or ‘biased’ in a way that simply normalizes the ‘bias’, orvalue-orientation, of institution theory. A challenge for advocates of critical analysisis to show why, instead of seizing upon‘agency’ or ‘power’ as overlooked variablesfor devising better predictions of institution-alization, closer acquaintance with criticaltheory can offer an alternative for anyoneinterested in studying how power and agencyare institutionalized in forms of normaliza-tion and subjectification.

APPENDIX

Critical theory is a capacious and slipperylabel invoked to characterize diverse forms ofanalysis. Just as institutional theory is, onoccasions, identified with one of its leading orfavoured (e.g. normative, rational choice, sociological, economic or historical) variants, critical theory is sometimes directlyassociated with, or even assumed to be identi-cal to, either Marxism (in its various forms)or Critical Theory (distinguished by its capitals) of the Frankfurt School (e.g.Marcuse, Habermas, etc.). All versions of crit-ical theory draw on a range of disciplines –economics and philosophy, as well associology and psychoanalysis, to advance


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critical thinking within a broad framework ofhumanistic Marxism (see Alvesson andWillmott, 1996, especially ch. 3). Refusingthe restrictiveness of this intellectual terrain,which contemporary Critical Theorists havealso sought to extend or revise, a growingnumber and range of theories are identifiedas ‘critical’.

So, in the contemporary context, it isimplausible to equate critical theory withCritical Theory although an important conti-nuity with the Frankfurt School is its inter-disciplinary orientation and emancipatoryintent. A common, recent, thread is a critiqueof death in a variety of forms, e.g. of realism,of narratology, of the author. Our chaptermay also be read as a critique of the deaththreat posed to critical theory in organizationstudies by the suffocating expansion of(uncritical) institutional theory. The range ofcritical theory resonates strongly with criticalwork that is emerging within the field ofmanagement under the umbrella of CriticalManagement Studies. For proceedings of theCMS conferences held bi-annually since1999, see <www.mngt.waikato.ac.nz/ejrot/cmsconference/default.htm> and <www.mngt.waikato.ac.nz/ejrot/>; see also Adler,Forbes and Willmott, 2007.

Developments in the fields of philosophy(Wittgenstein), linguistics and semiotics(Saussure) and literary criticism (de Man)have become highly influential in the con-temporary formation of critical theory in thesocial sciences, especially through the writ-ings of Foucault, Derrida and, increasingly,Bourdieu, Lacan and Zizek. What these criti-cal thinkers challenge and unpack, in differ-ent ways, is the capacity of language toprovide a faithful representation of thatwhich it aspires to reference (Rorty, 1979).This ‘linguistic turn’ does not necessarilyinvolve a reductionist equation of social reality with language, as some of its lazydetractors are inclined to claim. Rather, thepost-realist position is that,

what we take to be knowledge is constructed inand through language. Knowledge has no securevantage point outside such socio-linguistic

processes. Whatever knowledge is, it cannot bejustified through metaphors which commit us tothinking that it is an accurate representation of theexternal world. [It is] what Vattimo calls ‘the mythof transparency ‘... it is language and the socialnegotiation of meaning themselves that need to be illuminated to display their constructive properties and processes. (Johnson and Duberley,2000: 96–7)

A ‘crisis of representation’ has developed asa consequence of the view that the referenteludes any transparent or stable representa-tion by the signifier because, it is argued, thelatter can articulate only a particular, histori-cally and culturally embedded and fre-quently contested, signified. Consider thesignifier ‘critical theory’. This term (or text)is deployed to point to a referent (what criti-cal theory is) but the contested nature of crit-ical theory makes it impossible to fullystabilize what is signified by this signifier. Tothe extent that some degree of stability isaccomplished, it is achieved hegemonicallyby effectively excluding or silencing otherpossible signifieds, and not as a consequence of providing a fully transparent or compre-hensive characterization of its referent.Derrida coined the phrase ‘metaphysics ofpresence’ to characterize the fantasy of trans-parency (see also Rorty, 1979). This examplealso serves to indicate the centrality of power(hegemony) in the reproduction and transfor-mation of human realities, including the real-ities produced by scientists (Kuhn, 1970:206). The resolution, or ‘sedimentation’, ofsuch contests is understood, by Foucault(1980) for example, as an articulation ofpower-knowledge, and not as a product ofconsensus or epistemological privilege, asimplied, for example, by Berger andLuckmann (1966) and Tolbert and Zucker(1999). Post-realist thinking has fuelled thedevelopment of critical theory across thesocial sciences and humanities in ways thathave considerably extended its scope, diver-sity and influence.

Analyses identified as ‘functionalist’ and‘positivist’ have been amongst the primaryintellectual targets of critical theories as these approaches are inclined to assume the


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functional value of the status quo and/or the ahistorical status of social facts (see Alvessonand Willmott, 1996). But, of course, the aspi-ration to critique the naturalization of thepresent, whether in social science or every-day life, does not exempt elements and ver-sions of critical theory from critical scrutiny.In such ways, ostensibly ‘critical standards’within a discipline can ‘generate a relativelyclosed world’ (Barnett, 1997: 18) as criticaltheory becomes over-protective of its internalsacred cows. It is the limiting, oppressivequalities of such closures in all approaches(including its own) that, in different ways,critical theories aspire to bring to conscious-ness and open up to scrutiny.

Critiques of naturalization of the presentare not, of course, limited to problematizinghow language(s) are engaged to bolster andrefine what is normal. For critical theoriesassess processes of emancipation to be frus-trated, nationally and globally, by sociallyunnecessary limitations on radically demo-cratic forms of decision-making and associ-ated self-determination within both publicand private (e.g. workplace) spheres. Variantsof critical theory challenge the fetishized,and seemingly uncontrollable, order ofglobal capitalism that generates extremelyasymmetrical distributions of resources andlife-chances. Critical theory does not pretendto provide value-neutral reports of processesof globalization, for example. Rather, reject-ing the notion of value-free science as a myth that sustains the status quo, critical theories challenge the relentless pursuit ofgrowth for being socially divisive and eco-logically unsustainable. Such critical think-ing understands that resources – in the formof knowledge as well as raw materials andtechnologies – exist that could bring about aradical redirection of priorities. Criticaltheory, as conceived here, is engaged in thecritique of ideas and institutions – patriarchy,racism, and science, as well as capitalism –that are assessed to legitimize resistance to aprogressive transformation of social relationsas well as to the advancement of ideas andinstitutions more relevant to facilitating radi-cal change than to preserving the status quo.

NOTES

1 There are many versions of institutional theory.We focus here on the dominant, sociologicallyinformed, versions in the Anglo-American literature.As might be expected, there are regional variations,and institutional theories that are more historical andeconomic in emphasis (e.g. Menard and Shirley,2005).

2 Methodological individualism ‘amounts to theclaim that social phenomena must be explained byshowing how they result from individual actions,which in turn must be explained through referenceto the intentional states that motivate the individualactors.’ (Stanford Encyclopedia of Philosophy,<http://plato.stanford.edu/entries/methodological-individualism> accessed 03/01/07)

3 The term ‘value-orientation’ is closely associ-ated with the work of Weber and is a shorthandtranslation of Weltanshaungen, a term whichBrubaker (1984) regards as virtually ‘untranslatable’!Value-orientations are not judgements but, rather,are ‘general views of life and the Universe’ that areboth theoretical and practical as ‘they endow theworld with meaning and at the same time definepaths of action’ (Brubaker, 1984: 62, citing Weber,1949: 57). Since ‘methodological individualism (seenote 2) is also associated with Weber’s position, westress that it is possible to agree with philosophicalelements of Weber’s thinking without subscribing tohis methodology.

4 Aside from the question of their compatibility,the lack of inquisitiveness is perhaps attributable todark mutterings about the leftist leanings of some ofthe original institutional. theorists. In the repressiveintolerance of many business schools, scholars have taken refuge in an orientation to the study ofinstitutionalization in which critical thought isdomesticated if not fully cleansed. Amongst thatband of highly influential, ‘old’ institutionalists,Selznick is known for his youthful association with‘the Trotskyists, the socialists, the anarchists andZionist socialists’ (Lipset, 1996: 4). Jonathan Murphyalerted us to the link between leading institutionaltheorists and leftist politics.

5 Likewise, critical students of organization haverarely engaged with institutional theory. As an indica-tor of this neglect or indifference, the coverage ofinstitutional theory by two critical textbooks is eitheralmost non-existent (Thomson and McHugh, 2002)or largely descriptive (Clegg,1990).

6 That selective appropriations and translations of elements of critical theory into institutional theory (and vice-versa) have occurred is not at issue(e.g. Oakes, Townley and Cooper, 1998; Lawrence,Winn, and Jennings, 2001; Seo and Creed, 2002).Such hybridization is inherently perilous and poten-tially confusing, especially where some variant of critical theory is shoehorned into the framework


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of institutional theory. In this regard, we agree withLounsbury (2003: 216), though for rather differentreasons, that ‘analytical approaches of interest tocritical theorists [are] not easily translatable into therepertoire of institutional analysis’.

7 Foucault’s work was cited more frequently inscholarly social scientific journals during 1995–2000than any other author, and indeed received twice thenumber of citations as the second most cited author(see Posner, 2001).

8 Against this thesis, it might be argued thatinstrumental rationality provides for more assessmentof, and thus reflection upon, the means of attainingends as well as the possibility of distancing oneselffrom (responsibility for) calculating their selection.However, within Weber’s conception of instrumentalrationality, such forms of reflection and distancingare themselves instrumentally rational.

9 Only as an aside (that is not integrated withintheir notion of institutionalization), do Berger andLuckmann make any reference to institutionalizationas an articulation of power; and, even then, it isrestricted to a discussion of a situation in whichforms of institutionalization compete with each other(1966: 126–7). Specifically, they note that the construction of reality which proves victorious in suchcontests is likely to be advocated ‘by those who wielded the bigger weapons rather than thosewho had the better arguments’ (1966: 127). But this very brief commentary on how conflictsbetween rival forms of institutionalization areresolved is absent from their (consensualist) concep-tion of institutionalization.

10 Along with much else in Friedland and Alford’s(1991) instructive contribution, this observation hasnot been taken up in institutional theory. InsteadFriedland and Alford’s has been selectively appropri-ated for its use of ‘logics’ and ‘contradiction’. We aregrateful to Jaco Lock for this insight.

11 The aspiration to critique the naturalization ofthe present, whether in social science or everydaylife, does not exempt elements and versions of critical theory from critical scrutiny. Critical thinkingmay also be developed, selectively appropriated and translated to bolster and refine what is ‘normal’(cf Kuhn, 1970) – for example, through an assess-ment and effective domestication of elements that are potentially threatening to established thinking, as is illustrated by the recent flirtation byneo-institutonalists with critical discourse analysis(Phillips, Lawrence and Hardy, 2004); semiotics andactor network theory (Lawrence and Suddaby,2005)and rhetoric (Suddaby and Greenwood, 2006).

12 See Baritz (1960) and Brief (2000).13 Indeed, from our Foucauldian standpoint, it

would be perverse to claim that we provide an ‘accu-rate interpretation’ either of Foucault’s work or of thediverse contributions to institutional analysis dis-cussed in this chapter; or, relatedly, that we aspire

to correct other interpretations that stand accused of producing mere ‘social constructions’ which takeon ‘identities created as much by their users as their authors’ (Mizruchi and Fein, 1999: 653). In Foucauldian analysis, the author is de-centred in the sense that s/he is not ascribed the sovereign power to adjudicate the meaning of thetext. We recognize that this undermines both literal-ism and the sovereignty typically attributed toauthors and, for this reason, it tends to attract knee-jerk accusations of ‘relativism’ and ‘nihilism’.However, reducing a text to a single, authoritativereading – as dictated by the author or by anyone else – would seem to be an absurd, Sisyphean task(Camus, 1955).

14 Bhaskar’s warrant is a (retroductive) mode ofscience that is concerned to disclose the causalmechanisms which generate empirical phenomena,whereas Habermas’s warrant is a counterfactual idealspeech situation that, he argues, is inherent in thestructure of communication, and which provides afoundation for objective knowledge.

15 By ‘non-foundationalist’ we mean ‘rejectingthe asymmetric image of basic (immediately justified,foundational) beliefs that support nonbasic beliefs.Non-foundationalists prefer the image of a web ofmutually supporting beliefs, which are mediatedthrough a particular community.

16 This allows for the possibility of productivelystudying power in a variety of ways. Other criticalapproaches, such as Braverman’s (1974) labourprocess analysis, adopt a sovereign or juridical con-ception of power and shed insight into the wayworkers’ knowledge is appropriated by managementin the pursuit of profit.

17 Institutional theory does not readily conceiveof these ‘logics’ as forms of power since power isassociated with agency, whereas logics are associ-ated with legitimacy.

18 It is also evident in his assessment of the con-tribution of institutional theory which is character-ized as one that ‘rests in the identification of causalmechanisms leading to organizational change andstability on the basis of precarious understandingsthat organizational actors share, independent oftheir interests’ (DiMaggio, 1988: 3). For critiques ofthe use of ‘interests’ in institutional theory, seeCampbell, 2006; Enrione, Mazza and Zerboni, 2006;Fligstein, 2006.

19 In Lawrence et al.’s typology, power as ‘domi-nation’ is reserved, oddly enough, for ‘forms ofpower that support institutionalization processesthrough systems of organized, routine practices thatdo not require agency or choice’ (2001: 637) – arestriction that eliminates virtually every form or exer-cise of non-juridical power. In comparison to ‘influ-ence’, ‘force’ and ‘discipline’, ‘domination’ is(conveniently) conceived by Lawrence et al. to be amarginal and exceptional form of power.


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20 In the spirit of self awareness and reflection, itis appropriate to acknowledge that Foucault’s versionof critical theory leaves open the nature andprocesses of emancipation. While this openness isappealing to us, since it leaves such determinationsto local struggles, contexts and understandings,other versions of critical theory – for exampleMarxism and Critical Theory – identify more universalnotions of emancipation. The relevance of differingversions of critical theory for understanding manage-ment can be found in Alvesson and Willmott (2004),and engaging debates about their relevance forstudying accounting can be found in Neimark (1994),Armstrong (1994) and Hoskin (1994).

21 The phenomenological tradition, in whichBerger and Luckmann’s thinking is partially located,problematizes, or denaturalizes ‘cultural understand-ings’, albeit in a universalizing rather than historical,power-sensitive, manner.

22 We are indebted to Jaco Loc for this felicitoussummary.

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