The System of Management Ideas: Origins, Microfoundations, and Dynamics

Abstract

We argue that there is a system of management ideas, that is, set of institutionalized high level heuristics that guide organizational and individual behaviours in managerial reality, involves distinct knowledge and transfers that knowledge across time and space, may change as a result of local adaptation or innovation, and may be selected for or against. This system operates at multiple levels, particularly the individual, organizational and institutional levels. A system of management ideas can be analyzed through a microfoundational approach, where actions of individual agents lead to an evolution of the system through processes of variation, selection and retention. We then specifically apply this approach to organizational level choices between adopting existing, fashionable management practices versus creating novel management practices. We present a process model depicting this make-or-buy choice in management practices and provide insights into why and when organizations may choose one of these routes over another one.