How Hybrid Organizations Respond to Institutional Complexity: The Case of Norway

Abstract

In past decades, hybrid organizations and institutional complexity have received growing attention, yet questions remain about how hybrids manage institutional complexity in the Nordic welfare states. This article investigates how Norwegian social enterprises (SEs), a subset of hybrid organizations, internally manage contradictory demands when externally engaging with multiple logics. The data consists of interviews of leaders and staff members from five SEs, and the findings show that most institutional referents hold a public-sector logic which may crowd out the hybrid nature of SEs. Depending on the conflicting demands, SEs mix decoupling and selective coupling when responding to them. Some were also found to rely on the structural responses of organizational compartmentalization. Compared to the blended hybrids, the structural hybrids experience less internal tension when managing institutional complexity since logic compartmentalization allows the organizations to attend both to their in-use logic and at-play demands. The data yield compelling insights into how the Nordic welfare state may incite a specific configuration of SE where logic compartmentalization appears as a pragmatic choice.