When A+B Does Not Equal B+A: Asymmetrical Combinations and Performance in Microfinance

Abstract

This paper tests propositions about organizations facing multiple demands, and builds theory about differences in organizational hybridization and its consequences. Prior work suggests that in order to avoid conflicted or compromised performance, organizations concentrate on performance related to only one set of demands. Yet recent work has suggested that organizational configurations might be able to simultaneously fulfill multiple sets of demands. I compare the performance of hybrid and non-hybrid organizations, as well as different types of hybrid organizations. I propose and find that hybrid organizations without barriers to integration are most able to achieve high performance relative to two sets of demands. These dynamics have observable outcomes in the microfinance industry, where performance is measured relative to multiple demands. Findings have implications for hybrid organizing, and are likely to have implications for any organization attempting to satisfy two different sets of demands.