Oscillating between logics: A process view on responding to institutional complexity

Abstract

The institutional literature has given considerable attention to the tensions that arise from multiple institutional logics and how organizations respond. However, this research has tended to consider responses to institutional complexity as static. To overcome the static view, this paper develops a process lens on how organizations respond to institutional complexity both in the moment and over time. We argue that a process view can extend understandings of institutional complexity through attending to the ongoing practical responses of social actors within institutions and organizations by directing our attention to their temporality. Appreciating temporality shifts our focus to the ongoing, unstable and constantly evolving nature of responses to institutional complexity over time. The expanding field of impact investment is selected as an appropriate site to explore the dynamic nature of responses to institutional complexity given its competing impact logic (focused on social welfare, community development and environmental sustainability) and investment logic (focused on delivering commercial financial returns to investors). The paper adopts a longitudinal multiple case study over a five-year period, examining 29 organizations within the Australian impact investment marketplace through 59 in-depth semi-structured interviews with impact investors, foundations, institutional investors, social enterprises and other collaborators connected to three new impact investment funds. Through the process lens we see the dynamic ways in which individuals and organizations cope with complexity: (i) oscillating in the moment and over time; (ii) becoming hybrid; (iii) experiencing shocks. These findings extend process perspectives on institutional complexity by providing empirical insights on how responses to institutional complexity are constantly in motion both within the moment and over time.