Introduction
Over the past decades, research has turned to how organizations strategically respond to institutional complexity (Besharov & Smith, Reference Besharov and Smith2014; Ocasio & Radoynovska, Reference Ocasio and Radoynovska2016; Radoynovska, Ocasio, & Laasch, Reference Radoynovska, Ocasio, Laasch, Laasch, Suddaby, Freeman and Jamali2020; Raynard, Reference Raynard2016; Smets, Jarzabkowski, Burke, & Spee, Reference Smets, Jarzabkowski, Burke and Spee2015). Institutional complexity comprises situations where multiple institutional logics, understood as principles that prescribe and proscribe actions to achieve certain goals in a field, are in jurisdictional overlap (Thornton, Ocasio, & Lounsbury, Reference Thornton, Ocasio and Lounsbury2012). Such situations are of strategic importance to organizations as institutional complexity may potentially both threaten to pull them apart and serve as strategic resource (Ocasio & Radoynovska, Reference Ocasio and Radoynovska2016; Vermeulen, Zietsma, Greenwood, & Langley, Reference Vermeulen, Zietsma, Greenwood and Langley2016). Responses to institutional complexity have for long primarily been considered a top management accomplishment (e.g., Almandoz, Reference Almandoz2014; Battilana & Dorado, Reference Battilana and Dorado2011; Laasch & Pinkse, Reference Laasch and Pinkse2020; Pache & Santos, Reference Pache and Santos2010; Radoynovska, Ocasio, & Laasch, Reference Radoynovska, Ocasio, Laasch, Laasch, Suddaby, Freeman and Jamali2020; Wenzel, Stanske, & Lieberman, Reference Wenzel, Stanske and Lieberman2020). Correspondingly, a line of research has focused on top management strategizing (Liu & Maitlis, Reference Liu and Maitlis2014; Wenzel & Koch, Reference Wenzel and Koch2018; Wenzel, Stanske, & Lieberman, Reference Wenzel, Stanske and Lieberman2020). Contrary to a focus on top management, recent research shows that institutional complexity is handled variously at different levels of the organization (Andersson & Gadolin, Reference Andersson and Gadolin2020; Demers & Gond, Reference Demers and Gond2020; Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Reference Jonasson, Mäkitalo and Nielsen2015Klemsdal & Wittusen, Reference Klemsdal and Wittusen2023; Malhotra, Zietsma, Morris, & Smets, Reference Malhotra, Zietsma, Morris and Smets2021). Specifically, a recent study shows that middle managers across different organizations find ways to either accept or reject reinforced managerial logics (Olsen & Solstad, Reference Olsen and Solstad2020). Relatedly, research has investigated middle managers’ strategizing and thereby emphasized that strategizing is an accomplishment of multiple actors beyond top managers’ control (Balogun & Rouleau, Reference Balogun, Rouleau, Floyd and Wooldrige2017; Tarakci, Ateş, Floyd, Ahn, & Wooldridge, Reference Tarakci, Ateş, Floyd, Ahn and Wooldridge2018; Tarakci, Heyden, Rouleau, Raes, & Floyd, Reference Tarakci, Heyden, Rouleau, Raes and Floyd2023; Van Rensburg, Davis, & Venter, Reference Van Rensburg, Davis and Venter2014).
However, we suggest that there is a need to investigate middle managers’ strategizing for institutional complexity. We thereby combine research on institutional complexity with research on middle managers’ strategizing. This is in correspondence with recent calls for inquiry into institutions and strategizing that uncover the ‘subtleties of how macro-level institutions are instantiated in micro-level activities’ (Kohtamäki, Whittington, Vaara, & Rabetino, Reference Kohtamäki, Whittington, Vaara and Rabetino2022, p. 219). Carrying out such research is important to fully understand how organizational responses to diverse institutional logics is formed through microlevel strategizing practices, while such strategizing is being formed by macrolevel institutional complexity. In doing so, we moreover follow recent encouragements for a renewed focus on strategizing as practices and thereby as socially distributed accomplishments (Jarzabkowski, Kavas, & Krull, Reference Jarzabkowski, Kavas and Krull2021; Rouleau & Cloutier, Reference Rouleau and Cloutier2022). This allows for going beyond assumptions of strategizing for institutional complexity as an exclusive managerial activity. Instead, strategizing as a social accomplishment involves that strategic activities are dispersed and relationally shaped across organizational levels, being inscribed into the larger system of norms and rules (Jarzabkowski, Seidl, & Balogun, Reference Jarzabkowski, Seidl and Balogun2022; MacKay, Chia, & Nair, Reference MacKay, Chia and Nair2021; Rantakari & Vaara, Reference Rantakari, Vaara, Courpasson and Vallas2016). Nevertheless, as outlined by Rouleau, Balogun, and Floyd (Reference Rouleau, Balogun, Floyd, Golsorkhi, Rouleau, Seidl and Vaara2015), previous studies have primarily investigated strategizing practices either vertically between, for example, middle managers and employees (e.g., Bjerregaard, Reference Bjerregaard2011; Splitter, Jarzabkowski, & Seidl, Reference Splitter, Jarzabkowski and Seidl2023), or top management and middle managers (e.g., Birollo, Rouleau, & Teerikangas, Reference Birollo, Rouleau and Teerikangas2023; Heyden, Fourné, Koene, Werkman, & Ansari, Reference Heyden, Fourné, Koene, Werkman and Ansari2017), or laterally, at the same level, among middle managers or employees (e.g., Balogun, Best & Lê, Reference Balogun, Best and Lê2015; Balogun & Johnson, Reference Balogun and Johnson2004; Jarzabkowski & Bednarek, Reference Jarzabkowski and Bednarek2018; Tarakci et al., Reference Tarakci, Ateş, Floyd, Ahn and Wooldridge2018).
Therefore, the present article aims to, first, examine the vertical dynamics of middle managers’ (re)strategizing institutional complexity at the nexus of top managers and employees. This allows us to explore middle managers’ contributions to strategizing institutional complexity as they wrestle with the organizational turbulence occurring from ‘unsettled’ prioritization of logics (Raynard, Reference Raynard2016), and from their followers’ responses to such strategizing. Second, we aim to explore the lateral dynamics of interaction between multiple middle managers. This allows us to explore how and why pluralistic, interdependent re-strategizing responses to institutional complexity might emerge. Combining these aims, we investigate the emerging organizational consequences of strategizing for institutional complexity as a situated social accomplishment being formed through vertical and lateral practices of strategizing. We here respond to recent calls for exploring how organizational consequences are the result of ongoing, multidirectional strategy formations (Burgelman et al., Reference Burgelman, Floyd, Laamanen, Mantere, Vaara and Whittington2018).
Accordingly, this article responds to the theoretically motivated question of: How do vertical and lateral dynamics of practices shape middle managers’ strategizing for institutional complexity in an organization facing reform?
To explore these dynamics of strategizing institutional complexity, we take departure in a qualitative study of a payment processing firm operating in a field under substantial pressure for institutional reform. The article follows suggestions to cross-pollinate literature on organizational responses to institutional complexity with conceptual resources from the strategy-as-practice (henceforth SAP) field (Jarzabkowski, Reference Jarzabkowski2005; Jarzabkowski et al., Reference Jarzabkowski, Seidl and Balogun2022; Kohtamäki et al., Reference Kohtamäki, Whittington, Vaara and Rabetino2022; Suddaby, Seidl, & Lê, Reference Suddaby, Seidl and Lê2013).
Theoretical background: Strategizing institutional complexity
In this section we account for the conceptual resources of institutional complexity and SAP, which we combine to sensitize the empirical analysis.
Organizations operating in institutionally complex environments
Current studies of institutions are far from limited to neo-institutional theory (Ocasio & Gai, Reference Ocasio and Gai2020). Instead, it has been stated that the institutional logics perspective has contributed to the introduction of a practice-based approach to the study of ‘ongoing institutional variation and change’ (Lounsbury, Steele, Wang, & Toubiana, Reference Lounsbury, Steele, Wang and Toubiana2021, p. 263). Institutional logics comprise societal-level cultural influences on cognition and action and constitute the core components of institutional complexity (Thornton, Jones, & Kury, Reference Thornton, Jones and Kury2005). They delineate the forms of organization and action considered legitimate in a field of activity and can coexist in both cooperative and competitive tension (Cloutier & Langley, Reference Cloutier and Langley2013; Laasch & Pinkse, Reference Laasch and Pinkse2020; Raynard, Reference Raynard2016; Reay & Hinings, Reference Reay and Hinings2009; Zilber, Reference Zilber2011). Recent conceptualizations portray such logics as balanced in different constellations (Goodrick & Reay, Reference Goodrick and Reay2011; Høiland & Klemsdal, Reference Høiland and Klemsdal2022), characterized by different degrees of compatibility and contradiction (Besharov & Smith, Reference Besharov and Smith2014; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015), and jurisdictional overlap and settlement (Gümüsay, Smets, & Morris, Reference Gümüsay, Smets and Morris2020; Raynard, Reference Raynard2016). The distinct configurations of institutional complexity inform and impact the strategies of organizations (Besharov & Smith, Reference Besharov and Smith2014; Pache & Santos, Reference Pache and Santos2010), where they may serve as strategic resources (Durand, Szostak, Jourdan, & Thornton, Reference Durand, Szostak, Jourdan, Thornton, Lounsbury and Boxenbaum2013; Laasch & Pinkse, Reference Laasch and Pinkse2020). Granting attention to institutions in strategy research thus contributes to understanding strategic diversity as multiple institutions within a given context leave room for strategic maneuvering of firms (Hung & Whittington, Reference Hung and Whittington2011).
The research has often focused on strategies of responding to institutional complexity as ready-made or rather static solutions chosen at the organizational apex (Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015). The lion’s share of early research that addressed intraorganizational institutional complexity focused on which elements of multiple logics organizations integrate. Recent research has focused more on uncovering specifically how this is accomplished and by whom (Greenwood, Raynard, Kodeih, Micelotta, & Lounsbury, Reference Greenwood, Raynard, Kodeih, Micelotta and Lounsbury2011; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015). Thus, a series of practice-near studies addresses how ‘ordinary’ people balance institutional complexity integral to their everyday work (Andersson & Gadolin, Reference Andersson and Gadolin2020; Demers & Gond, Reference Demers and Gond2020; Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Jarzabkowski, Smets, Bednarek, Burke, & Spee, Reference Jarzabkowski, Smets, Bednarek, Burke and Spee2013; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015). This paves the way for exploring the character and consequentiality of middle managers’ strategizing for institutional complexity as being socially distributed across an organization.
Strategizing institutional complexity as distributed, situated and emergent practice
Practices with strategic consequentiality can both exist as more macro or societal-wide practices and as microlevel practices that are specific to particular organizational contexts (Burgelman et al., Reference Burgelman, Floyd, Laamanen, Mantere, Vaara and Whittington2018), the latter being the focus of our research. An SAP lens considers the work of strategizing as distributed, socially situated and an emergent activity (Jarzabkowski, Reference Jarzabkowski2005; Jarzabkowski et al., Reference Jarzabkowski, Kavas and Krull2021; Smets, Greenwood, & Lounsbury, Reference Smets, Greenwood, Lounsbury, Golsorkhi, Rouleau, Seidl and Vaara2015). As noted by Jarzabkowski (Reference Jarzabkowski2005), strategy is ‘socially accomplished activity constructed through the actions and interactions of multiple actors’ (p. 7). Vaara and Whittington (Reference Vaara and Whittington2012) further suggest that it comprises ‘the myriad of activities that lead to the creation of organizational strategies. This includes strategizing in the sense of more or less deliberate strategy formulation, (…), and all the other activities that lead to the emergence of organizational strategies, conscious or not’ (p. 299). Engaging SAP inspirations, thus, allows us to consider even quite mundane practices, which are not necessarily considered formal strategy practices, yet which play a role in strategy formation through their consequentiality (Jarzabkowski et al., Reference Jarzabkowski, Kavas and Krull2021). Hence, an SAP lens widens the understanding of what is considered strategic. Organizational participants, then, not only strategize under institutional complexity. They also strategize institutional complexity itself by (re)configuring logic constellations in the dispersed dynamics of organizational strategy formation. The following theoretical conceptualizations orient our investigation of the stated research question.
First, being distributed activity means that strategy formation involves multiple actors’ contributions as a wide organizational activity (Jarzabkowski, Reference Jarzabkowski2005; Jarzabkowski et al., Reference Jarzabkowski, Seidl and Balogun2022; Rouleau & Cloutier, Reference Rouleau and Cloutier2022; Tarakci et al., Reference Tarakci, Heyden, Rouleau, Raes and Floyd2023). Thus, strategizing institutional complexity is not merely in the hands of managers at the top but also local managers, who bring forth but also reformulate strategies (Binder, Reference Binder2007; Birollo et al., Reference Birollo, Rouleau and Teerikangas2023; Birollo & Teerikangas, Reference Birollo and Teerikangas2022; Heyden et al., Reference Heyden, Fourné, Koene, Werkman and Ansari2017). Insights into managers’ balancing of institutional complexity can thereby be widened with recent SAP research demonstrating that strategizing is distributed to also include managers at the middle (Balogun & Rouleau, Reference Balogun, Rouleau, Floyd and Wooldrige2017; Pfister, Jack, & Darwin, Reference Pfister, Jack and Darwin2017; Rouleau, Reference Rouleau2005). They are in a key position to translate logics into action (Olsen & Solstad, Reference Olsen and Solstad2020). Moreover, recent SAP research has suggested that middle managers do not craft strategic responses to institutional complexity in isolation but in ongoing interactions with superiors, peers, and followers (Rouleau et al., Reference Rouleau, Balogun, Floyd, Golsorkhi, Rouleau, Seidl and Vaara2015). It is an ontological premise that strategy thus is a perennially unfinished project (Iszatt-White, Reference Iszatt-White2010). Attention should be directed to the distributed, social accomplishments of strategizing institutional complexity (Jarzabkowski, Kaplan, Seidl, & Whittington, Reference Jarzabkowski, Kaplan, Seidl and Whittington2016; Rouleau & Cloutier, Reference Rouleau and Cloutier2022; Vaara & Whittington, Reference Vaara and Whittington2012). Extending this to the present research, we explore the vertical and lateral dynamics of interactions between middle managers and fellow organizational actors and how this shape distributed, ongoing practices of strategizing of institutional complexity.
Second, strategizing is socially situated in that actors’ strategizing practices are shaped by their situatedness in local social relationships as well as the societal context in which they are embedded, such as, for example, broader institutions (Ericson & Melin, Reference Ericson, Melin, Golsorkhi, Rouleau, Seidl and Vaara2010; Jarzabkowski, Reference Jarzabkowski2005). Relatedly, institutional research connecting individuals to institutional logics has explored the significance of identity (Lok, Reference Lok2010; Toubiana, Reference Toubiana2020) and institutional biography (Bertels & Lawrence, Reference Bertels and Lawrence2016) and how identities of managers have implications for their responses to institutions (Hung & Whittington, Reference Hung and Whittington2011). In the present study, the focus is on the situatedness of middle managers, whose historical and institutionalized status and power relations shape the development of competing practices of strategizing institutional complexity.
Third, SAP scholarship has shown that top-down and bottom-up practices often weave together in ongoing strategy formation (Mirabeau & Maguire, Reference Mirabeau and Maguire2014; Vaara & Whittington, Reference Vaara and Whittington2012). Complicating this further, it has been suggested that managers are inevitably faced with unanticipated emergence, such as when followers and fellow actors counteract or actively reframe intended strategies (Lê & Jarzabkowski, Reference Lê and Jarzabkowski2015). Such unanticipated emergence can involve strategy obstruction, overt/covert confrontation, and critique of strategy, as well as the silent resignation from strategy (Whittle, Mueller, Gilchrist, & Lenney, Reference Whittle, Mueller, Gilchrist and Lenney2016). This is in correspondence with recent institutional research on middle managers having to handle followers’ resistance to novel logics (Kellogg, Reference Kellogg2019; Malhotra et al., Reference Malhotra, Zietsma, Morris and Smets2021). Therefore, we focus on how middle managers, in their strategizing institutional complexity, are faced with everyday struggles and critique from followers and fellow managers.
In summary, there is a need for further empirical research on how strategizing practices dynamically interact and combine in ongoing strategy formation (Burgelman et al., Reference Burgelman, Floyd, Laamanen, Mantere, Vaara and Whittington2018) when facing institutional complexity. We thus combine these conceptual inspirations across SAP and institutional complexity research to analyze how middle managers’ strategizing for institutional complexity occurs through distributed, situated, and emerging practices.
Methodology
A qualitative field study was chosen as a suitable research methodology for investigating in detail middle managers’ strategizing for institutional complexity as a social accomplishment with organizational consequences. Specifically, the ACB Company (pseudonym) was chosen based on its centrality as part of a field under heavy pressure for radical institutional change. In the aftermath of the Asian financial crisis, the Republic of Korea (henceforth Korea), and particularly its financial sector, was under heavy pressure to make major institutional changes to accommodate the International Monetary Fund’s (henceforth IMF) concerns (Cho, Reference Cho2008; IMF, 2000). The field study allowed us to investigate how actors in the ACB Company developed strategic responses to novel complexities of institutional logics underpinning what was termed Korean- and American-style management. In the results section, we describe in depth the field-level complexities in institutional logics, but first we turn to describing the company site and research methods.
Organizational research site
The ACB Company provided end-to-end payment services, and its portfolio included credit card acquisition (credit, debit, and prepaid) and card-issuing business outsourcing to financial institutions and retail. The company consisted of approximately 2,000 employees positioned in the head office and 11 branches. The primary research site, the Suwon branch (pseudonym), comprised approximately 35 employees and approximately 10 contractors. The Suwon branch, having agreed to be the primary site of the study, was a suited site for the research due to its ranking as the best-performing branch within the company. This meant that the branch held a central position in the company’s strategic aim of sustaining high performance amid field-level demands of institutional reform. The branch was placed in an upcoming business area and was organized with a general manager (henceforth GM) and three teams, each with a team leader. Each of the three teams had a designated work area comprising ‘services’ managed by team leader Kim, ‘marketing’ managed by team leader Song, and ‘sales’ managed by team leader Park. In our study of this company, we set out to explore how these middle managers strategize institutional complexity in practice.
Participant observation
The first author performed 4 months of participant observation in the branch. When carrying out minor odd jobs, the researcher became involved in small talk with the employees about work and everyday life. The researcher also participated in employees’ collection tours to customers and banks in the neighborhood to gain an understanding of their work assignments. Moreover, time was spent on coffee breaks, small groups’ lunch hours, and after-work social gatherings, where many informal conversations about conflicts and hardships at the workplace were adding to the more formal interviews. The researcher also participated in ACB Company outings and visited the head office as well as neighboring branches. This was important to gain insight into the company strategy as expressed by the top management residing at the head office. Visiting the neighboring branches provided insight into how, vertically, the head office and branches interacted in their formulation of strategic responses to national economic hardship and institutional complexity.
Interviews
The field study resulted in 42 semi-structured interviews with branch and team managers (4), employees (31), and with managers at the head office and neighboring branches (7). The first author carried out interviews in the branch’s open office, in empty meeting rooms, or in nearby cafes. The interviews were conducted in a combination of Korean and English. The interviews lasted between 1 and 2 hr and were subsequently transcribed (Bernard, Reference Bernard2006; Taylor & Bogdan, Reference Taylor and Bogdan1984). Initial participant observations formed the basis of the interview guide, which included questions about the Korean- and American-style management, branch as well as questions regarding company, branch and team leader balancing of such management styles. The interviews thereby focused on exploring strategic responses to the field-level institutional and corporate changes following the financial crisis. The interviews with top managers were particularly suitable for exploring in more detail how the ACB Company’s strategic changes were related to greater institutional complexities in the field of finances. Interviews with branch and team managers served the purpose of gaining insight into their aims and perceptions of re-strategizing company formal strategies to enhance local performances. Finally, interviews with employees were important for gaining insight into how they perceived local strategies to affect their everyday work, and how and why they, at times, counteracted such strategies.
Document analysis
In addition to visits to the head office and interviews with top managers, reports on the Asian crisis in Korea and formal company documents were also subject to analysis (Atkinson & Coffey, Reference Atkinson, Coffey and Silverman2011). Such documents comprised strategy and Human Resourcepolicies, newsletters, and the ACB intranet, which included records of the company’s new performance appraisal system, the so-called management by objectives (henceforth MBO) system. This was important for gaining insight into the company’s strategic decisions to implement so-called American-style management combined with Korean-style management in response to the field-level logic changes. Moreover, while managers and employees readily narrated their experiences and perceptions to the researcher, the formal documents made it easier to understand their referrals to specific difficulties with balancing American- and Korean-style management and HR policies.
Analysis
The analysis was initiated early on during the field study. Two strands of analyses were carried out. Regarding the first strand, the data material concerning everyday practices was originally coded into 24 initial in vivo codes organizing central themes in the data extracts (Miles, Huberman, & Saldaña, Reference Miles, Huberman and Saldaña2018). These initial codes were developed during the time of the fieldwork by reading the field notes and transcripts. This helped identify patterns of social interactions and responses to novel management styles as well as informing the continuous data gathering. Based on these codes, first-order themes were developed (Gioia, Corley, & Hamilton, Reference Gioia, Corley and Hamilton2013). The first-order themes were developed based on a cross-coding of observed and interviewed narratives of everyday practices and by using theory on institutional logics (Thornton, Ocasio, & Lounsbury, Reference Thornton, Ocasio and Lounsbury2012). This initial analysis centered around the emic terms of ‘Korean-style’ and ‘American-style’ management practices as strategic responses to institutional complexity. In the second strand of analysis conducted up until writing this the present article, the second-order themes were developed from a rereading of the first-order themes and related data through the lens of theoretical inspirations of SAP and institutional complexity research (Jarzabkowski et al., Reference Jarzabkowski, Kavas and Krull2021; Raynard, Reference Raynard2016; Rouleau & Cloutier, Reference Rouleau and Cloutier2022; Smets et al., Reference Smets, Greenwood, Lounsbury, Golsorkhi, Rouleau, Seidl and Vaara2015). Based on these theoretical inspirations, the authors decided to carefully reread the empirical data related to the managers’ interdependent re-strategizing responses to institutional complexities. This rereading of the empirical data widened the theoretical understanding of the empirical findings and led to important main second-order themes such as ‘interdependent practices for strategizing institutional complexity’ and ‘locally distributed strategic agency’. Table 1 provides a data structure display of the initial in vivo codes, the first-order themes, and the second-order themes.
Table 1. Initial in vivo codes and first- and second-order themes
Results: Vertical and lateral dynamics of strategizing institutional complexity
Below we first present the field developments reflected in institutional complexity and how this is responded to in formal ACB Company strategies. We thereafter zoom in on the middle managers’ strategizing for institutional complexity.
Company strategic response to institutional demands: Incorporating American style
At the time of this research study, Korea was heavily marked by the repercussions of a greater Asian crisis, which resulted in the involvement of financial support and structural reform programs of the IMF. Advancing neoliberal principles, the IMF demanded that Korea opened its financial markets to foreign investment and decentralized the financial sectors of the major conglomerates (Cho, Reference Cho2008). At the same time, Korean chaebols, such as Hyundai, Samsung, and LG, were under heavy pressure to respond to demands of changes in the institutional field up till now governed by logic elements of a strong vertical hierarchy and Confucian emphasis on family-like organizations (Park, Reference Park2004; Rowley & Bae, Reference Rowley and Bae2004). In the aftermath of the Asian economic crisis, the IMF demanded more competitive corporate restructuring and increased flexibility of the labor market (Cho, Reference Cho2008; IMF, 2000). Subsequently, the more typical Korean management practices of seniority-based hierarchies came under institutional demands for change toward more flexible human resource practices. This gave rise to a situation of unsettled field-level prioritization, with jurisdictional overlap and conflicting-yet-compatible, also referred to as, volatile institutional complexity (Raynard, Reference Raynard2016). Thus, Korean companies were exposed to a gradual transition from institutional logics of family-like and social hierarchical organization toward institutional logics of capitalist competition and individual performance, constituting an institutionally complex field (Lee, Reference Lee2003; Park & Kim, Reference Park and Kim2005). Similar logics of family and capitalism have been characterized by Thornton, Ocasio, and Lounsbury (Reference Thornton, Ocasio and Lounsbury2012) drawing on institutional logics on societal and market levels (Alford & Friedland, Reference Alford and Friedland1985; Bhappu, Reference Bhappu2000). Moreover, similar institutional logics are still salient as they have been included in recent studies of institutional and business changes in the Asia Pacific (Chin, Shi, Rowley, & Meng, Reference Chin, Shi, Rowley and Meng2021; Haveman, Joseph-Goteiner, & Li, Reference Haveman, Joseph-Goteiner and Li2023).
The logics were reflected and configured in the ACB Company strategy, being referred to as respectively ‘Korean style’ and ‘American style’ management and organization strategy. These emic terms referred to the organization members perceiving the institutional transition as being of Western influence. Being part of the company’s strategy for gaining legitimacy and survive in the aftermath of the Asian crisis, the two forms of logics were relationally constructed in variable constellations as being in some ways contradicting, in some ways complementary (see also Smets & Jarzabkowski, Reference Smets and Jarzabkowski2013). Inspired by Thornton, Ocasio, and Lounsbury (Reference Thornton, Ocasio and Lounsbury2012) tables of logic characteristics, we provide an overview of the logics and related strategic responses from the top management in ACB in Table 2.
Table 2. Overview of constellations of logics underpinning Korean- and American-style organization in ACB Company
Source: Inspired by Thornton et al. (Reference Thornton, Ocasio and Lounsbury2012).
* See for more detail Table 3.
** See Janelli (Reference Janelli1996).
With regard to the logics underpinning Korean-style form of organization and management, a central aspect of Korean companies had been the seniority-based job-grade system (Bae, Reference Bae1997). This system was based on institutional logics of a Confucian family-like harmonic hierarchy, and, thus, prioritized seniority rather than abilities and performances for specific tasks (Bae & Rowley, Reference Bae and Rowley2002; Chin et al., Reference Chin, Shi, Rowley and Meng2021). Moreover, in accordance with the Korean-style Confucian social system, so-called ‘regular’ employees with permanent contracts were often recruited based on what has been called ‘yongo’, translated to connections related to a shared hometown, school, or family relations (Bae & Rowley, Reference Bae and Rowley2002; Horak, Reference Horak2017; Horak & Taube, Reference Horak and Taube2016; Janelli, Reference Janelli1996). In regard to promotion, such ‘yongo’-based career paths in the organization were rather predictable (Bae, Reference Bae1997; Horak, Reference Horak2017). In ACB Company, ‘yongo’ was exemplified by the company recruiting most ‘regulars’ from the same university.
However, as the institutional logics of Confucian family-like hierarchy was heavily challenged by institutional demands advanced by the IMF, many firms in the Korean organizational field responded by incorporating more flexible employment on short-term contracts (Rowley & Bae, Reference Rowley and Bae2004). Similarly, in ACB Company, there was a growth in temporarily hired employees. This was legitimized by top managers’ reference to becoming a more modern organization where ‘old-time family and friendship-like “Yongo” alliances have been replaced by rational leadership and individual performance’ (top manager).
However, in the ACB Company, it seemed that two employment systems prevailed, where the introduction of flexible, competence-based employment structure was only complementary to the still existing practices of seniority-based hierarchies and hiring of regular employees based on ‘yongo’. For more details on the Korean job-grade system and the new American-style team organization, please see Table 3.
Table 3. Overview of the Korean-style job-grade system and the ACB Company American-style horizontal team organization
Source: Inspired by Bae (Reference Bae1997).
* While being only Fourth grade daeri ‘senior administrative’ due to, for example, a lack of a university education, this Korean-style job-grade position could in some cases be equivalent to the position of team leader in the company’s American-style team organization. This was the case with team leader Kim.
** The Korean-style job-grade position of fourth grade daeri ‘junior administrative’ was still used in the company to distinguish rank among the ‘regular’ employed team members. An example of a ‘junior administrative’ team member was Mr. Hong.
In response to institutional demands for change, the Korean companies also began adopting practices of flatter structures with more employee influence and performance-based evaluation and pay. This again reflected higher salience of capitalist market logics countering the Confucian family-like hierarchical logics (Kim & Park, Reference Kim and Park2003; Oh & Kim, Reference Oh, Kim, Rhee and Chang2002; Rowley & Bae, Reference Rowley and Bae2004). ACB Company followed suit with organizing team structures as part of a strategy integrating individual equity and performance. The company in external and internal strategy communication characterized itself as a modern corporation, which would ensure that ‘every individual staff member can prove his or her capabilities’. A cornerstone of this American-style management was implementing the MBO system for performance appraisal, measuring both managers’ and employees’ individual performance as well as the combined performance of each team and each branch. The official ACB strategy papers expressed that the MBO system should be ‘a system based on performance and expertise; a fair and rational evaluation system’ (internal document). The MBO system was also used for deciding promotions, job-rotations, and gaining bonuses. A top manager from the head office said, ‘It is very effective and very motivating for doing my job and for him to do his job, yes very motivating.’
Nevertheless, ACB Company still wished to sustain logics of Confucian-inspired family-like harmony in the company as expressed in their Korean-style practices. Therefore, in their strategy they still emphasized the family like collectivity, with slogans like ‘ACB company is my life’ and ‘Join the ACB Family’. Also, in the still prevailing company exams for regulars, questions regarding the family-like responsibility for the company were upheld. Yet, they no longer emphasized hierarchical relations but rather ‘hwahap’, translated to horizontal harmony, thus reflecting the transition toward a flatter American-style organization.
Overall, it seemed that despite top leaders’ formal strategy of prioritizing one of two seemingly contradictory logics, they did not entirely replace foundations of former logics. Thus, the company’s strategic response appeared to reflect what has been termed an ‘unsettled’ prioritization of institutional logics (Raynard, Reference Raynard2016). This further left room for local managers’ re-strategizing of complexity as will be outlined in the following.
Middle managers reworking strategies for institutional complexity
In the Suwon branch’s everyday operation, the GM entrusted his three middle managers, Kim, Song, and Park, to ensure that the new American-style strategy for increased performance based on MBO was sustaining the branch’s leading position. However, in doing so, the three middle managers reworked the company strategy by drawing on the institutional complexity to create highly diverse strategies.
The services team leader, Kim, reconfigured the branch strategy by seeking to create MBO results by sustaining some Confucian logic elements of ‘inhwa’ translated to hierarchical harmony. The team leader’s priority of such logic elements seemed to rest on his personal experiences with the up till now Korean-style hierarchy in the company, which a team member emphasized:
Team leader Kim is only ‘daeri’ [fourth grade, low-rank section head] because he only has a high school degree. So, he got promoted the old-fashioned way by licking his boss’ shoes. You see, team leader Kim is very ‘posinchom’ [conservative].
This so-called conservatism was being expressed by team leader Kim’s desire for, what in Korean terms is expressed ‘Jeong’, which entails hierarchical responsibilities of ‘sonbae’, superior, taking care of ‘hubae’, subordinate, in return for loyalty and respect. Thus, his re-strategizing of complexity involved creating good MBO results based on ‘Jeong’: The subordinates should do their work according to his commands and in return he would protect and ensure their position in the company. However, team leader Kim’s prioritization of ‘Jeong’ in re-strategizing complexity for the team was in some regard heavily challenged by some of the team members. A regular, ‘yongo’ employee, Song-Nae, directly refused his team leader’s order of taking on the assignment of reclaiming misused cards. This was a difficult and deemed ‘dirty’ piece of work belonging to a temporarily hired employee, who had recently quit his job. As Song-Nae pointed out ‘he [team leader Kim] cannot make me do it since I came in first place in the [company] exam’. This referred to him having obtained the best results in the Korean-style company exams still held annually for regular ‘yongo’ employees. Thereby, team leader Kim’s strategy for obtaining good MBO results through Korean-style management seemed to backfire in the vertical distribution to employees, who, also according to the Korean-style job-position system, outranked team leader Kim. The incident happened during a particularly strained period wherein the service team had been reprimanded for delivering poor MBO results.
When it came to team leader Song’s management of his own marketing team, he strategically leveraged logic elements of the new emphasis on more horizontal structures and individuality. This was in alignment with the ACB strategy of promoting American-style individual performance results and more horizontal relations where each team member should be able to prove their worth. Song for instance made one of the permanently employed team members, Mr. Hong, take care of supervising the team’s assignments. Mr. Hong thus gained more and more responsibility. This was the case when team leader Song, during one of the client meetings with colleagues from the head office, was not present but had instead gone to visit old friends in another branch. Team leader Song argued that he believed each person should do what they did best regardless of formal position:
As a leader you must trust your co-workers. And I hate to go meet clients. I always get so stressed. So, I just send Mr. Hong instead, and he is also so much better at it, you know he looks really serious.
However, Mr. Hong heavily challenged team leader Song’s leveraging of an American-style horizontal team strategy. At one of the after-work social gatherings (where alcohol let the feelings be more freely expressed), Mr. Hong publicly accused his team leader of not taking good care of the team in accordance with logics of Confucian social and family relations. He openly yelled, ‘You put “bugoerowo” [shame] on us as our team leader not holding up “jeong” [hierarchical responsibility].’
The third team leader Park, managing the sales team, on the one hand, praised the company’s American-style strategy where individual performance and creating good MBO results mattered more than being promoted based on the Korean-style seniority-based job-grade systems. As an example, he did not differentiate between scolding the younger temporary and the older seniority-based regular team members in his efforts to keep the team’s position as the best MBO performing sales team in the company. However, on the other hand, his re-strategizing of institutional complexity also involved a certain emphasis on Confucian-derived logic elements of creating a good family-resembling ‘inhwa’ hierarchical harmony. To him, this involved hosting social gatherings for his team after the numerous forced late-night working hours needed to improve the MBO performance. Team leader Park openly said that the social gatherings were key strategic to create Korean-style family-bonds. He expressed this: ‘My team is the number one team because they also feel pride in that; then they all want to work together, and I encourage that feeling.’ In this way, he managed to develop a combined American–Korean-style compensatory strategy for his team, where the institutional logic of family-resembling harmony was enacted as part of the strategy for keeping the leading team position through high individual performances in accordance with the new American-style company strategy. However, despite the emphasis on harmonious logic elements, Park’s team members expressed doubt that the team leader had the team’s best interests in mind. Rather, they perceived team leader Park as someone advancing his own interest in becoming promoted through the team members’ hard work. A temporarily hired team member explained:
You know, team leader Park really wants to become promoted to the head office. He makes our team work so much harder than the rest. Also, our [MBO] results last time were not so good, so now he is very, very angry with Kyong and Nam [temporarily hired team members] and wants to replace them with some new people who will work even harder.
Overall, the findings show how, vertically, the middle managers carried out diverging forms of re-strategizing of the company’s strategic response to institutional complexity. Yet, vertically in relation to their followers, the middle managers were confronted with critique of their re-strategizing as not living up to norms of, for example, taking proper care of subordinates and for reworking strategies to serve own ends. This finding corresponds with understanding strategizing practices as a distributed, social accomplishment, where managers’ strategizing is met by followers’ counter actions (Jarzabkowski et al., Reference Jarzabkowski, Seidl and Balogun2022; MacKay, Chia, & Nair, Reference MacKay, Chia and Nair2021; Rantakari & Vaara, Reference Rantakari, Vaara, Courpasson and Vallas2016; Rouleau & Cloutier, Reference Rouleau and Cloutier2022). Importantly, both middle managers and followers reworked the company strategy based on ‘unsettled’ institutional logics (Raynard, Reference Raynard2016). Below we show that such vertical practices of re-strategizing institutional complexity were further moderated by lateral interactions between middle managers.
Lateral interactions of strategizing with vertical effects on company strategy
The three team leaders strived to create good MBO rankings in accordance with the company strategy. However, in doing so, the team leaders’ strategizing for institutional complexity involved lateral struggles of leveraging own team by compromising the other team’s strategies. These lateral struggles were rooted in a stark competition for scarce middle management promotions. The GM appeared to keep out of the competition as he was already promised a promotion due to his very good ‘yongo’ connections high up in the top management. It was speculated that according to the still prevailing Korean-style job-grade system, either team leader Song or team leader Park would be promoted. Subsequently, team leaders Song and Parks’ divergent re-strategizing of institutional complexity not only concerned their obligation as middle managers to commit to the company strategy, but also became personal means of winning the competition for promotion. As shown below, the lateral dynamics across the three team leaders’ strategizing of institutional complexity fueled further emerging conflicts in the branch.
In team leader Kim’s service team, the lateral dynamics of strategizing transformed into somewhat gendered group conflicts among the team members. Team leader Park and Song were according to the Korean-style job-grade system superior to team leader Kim. This superiority was reflected in their open use of team leader Kim’s female team members to heighten a Korean-style family-like collective harmony in their own teams. Creating such a positive team atmosphere was a part of their team strategies aimed at heightening the team MBO performance. Specifically, the temporarily hired female employees in team leader Kim’s team were invited to numerous parties and social gatherings by either team leader Park or team leader Song. Here, they would have to live up to Korean-style female employee ideals, acting as hostesses taking care that enough food and drinks were ordered and keeping up a good atmosphere (cf. Janelli, Reference Janelli1996). In addition, team leader Song would also ask them to participate in official ACB Card promotions because, as he said, ‘they are more attractive than most of my team members’. Over time, the female employees had a hard time taking care of their job areas after long nights of socializing and doing extra work for the marketing team and, as a result, the team MBO results worsened even further leaving team leader Kim to express his dissatisfaction. However, the other team leaders openly defied him. One day when coming in much too late after a lunch together with the female service team members, team leader Song openly exclaimed, ‘Don’t worry about Mr. Kim, he knows he can do nothing when you are with me.’ Although the female employees apologized to their team leader Kim, they continued taking long lunch breaks and arriving late after night parties, as it became clear that team leader Kim never officially opposed the other two team leaders. In this way, the two team leaders used their Korean-based seniority status to overrule their fellow team leader’s desires and pursue their internal competition to bolster strategizing of institutional complexity in their teams and improve the American-style team MBO results.
Team leader Park did not only use team leader Kim’s employees in his strategy for good team MBO performance results and subsequently his own promotion. He further went on to discredit team leader Song’s emphasis on American-style horizontal relations in his team. This was exemplified when the two team leaders worked on shared tasks such as, for example, a joint venture assignment with a Japanese company. In accordance with his praise of an American-style horizontal organization, Mr. Song would always make sure that Mr. Hong, who spoke Japanese, accompanied him and even presented their marketing approach to the Japanese managers. However, underlining Mr. Hong’s critique of team leader Song in terms of not living up to Korean-style ‘jeong’, hierarchical responsibilities, Mr. Hong and the marketing team was even further disgraced by team leader Park. At the beginning of a meeting with the Japanese business partners, team leader Park said, ‘You must excuse us for letting team leader Song’s “daeri” [junior administrative] present to you our business plan at this honored meeting with you.’ This was considered a masked mocking of team leader Song’s American-style of letting a subordinate handle the collaboration with their highly esteemed Japanese business partners. This incident only worsened the strained relationship between team leader Song and Mr. Hong greatly affecting the team atmosphere. Team leader Park thereby used claims of preserving Korean-style hierarchy to win the internal competition for best American-style team MBO performance with Korean-style hierarchy. The competition between the two team leaders was confirmed by some of the employees. According to them, this no longer merely related to re-strategizing organizational aims of creating good MBO scores but also to ensuring that team leader Park’s team score was better than that of team leader Song.
A team member explained his view on why team leader Park and Song would not work together, even on creating good branch MBO scores:
They both want to become promoted to the head office or to being GM but I guess only one team leader from our branch will be promoted this time. So, there is much competition, and they are always fighting.
It seemed that, gradually, team leader Song was the one withdrawing as he appeared to care less and less about his job, coming in late or taking whole days off from the office, and even confiding to the researcher that he hoped to move overseas with his family.
Overall, the team leaders’ lateral struggles over different, yet interdependent recombinations of logics had negative, unanticipated effects on sustaining the company and branch’s strategic aim of continuous high performance. The employees from all three teams were exhausted and a great share of those holding temporary positions resigned, particularly from the sales team.
With team leader Song having given up in the competition with team leader Park, and the service team female employees not attending to their jobs, the service and marketing teams came out with worsened yearly MBO results. However, even team leader Park did not improve his sales team’s results as intended. Although Park had wanted to replace some of his temporary workers with new, harder working employees, the many resignations and difficulties with recruiting and training new employees instead caused delays in the sales team’s collection tasks. Consequently, the Suwon branch lost their status as the best performing branch. Although the GM recommended team leader Park for promotion, he did not receive this and one of the sales team members explained:
The head office wanted to keep up the ‘hwahap’ [collective horizontal harmony] in our branch without too many changes so the exam [needed for promotion to next job-grade position] was postponed. But I also think that they were mad because we lost our ranking as best branch.
This perception was confirmed during a visit from a ‘sangmu’, managing director. The managing director criticized the managers and employees in the branch, particularly sales and marketing teams, for not showing good results. It was emphasized that more was expected of each and one in the branch because they were representing one of the top branches on which the entire ACB Company was much dependent. However, one of the team managers from a neighboring branch blamed the company’s strategic balancing of American-style capitalist with Korean-style Confucian institutional logics as causing some of the competitive problems in Suwon as well as other branches:
It is really important with my team’s and my branch’s MBO score. And I like that it is a more modern company, you know, we are not so formal, and we can talk directly between managers and employees. We are not like the old Chaebols. You don’t just become promoted because you have seniority or ‘yongo’ [connections] – well at least not so much in the branches, maybe more so at the head office. But there is also more competition now because everybody knows that you need a good score. I do not like that.
This view reflected that the company strategizing for institutional complexity did not as intended lead to a complementary balance of logic constellations of, on the one hand, American-style individual performance and, on the other hand, Korean-style collectivity. Instead, the emerging strategizing practices had consequences of heightened conflict and worsened performance.
To summarize the findings, the middle managers’ re-strategizing of top management’s strategic balancing of ‘unsettled’ institutional demands (Raynard, Reference Raynard2016) had severe and unanticipated consequences for the overall company performance. This was due to the strategy being distributed and reworked throughout the organization in a way that allowed for emergence of diverse strategies of balancing institutional complexity. Specifically, the middle managers’ competing strategies of pursuing own goals by reworking company strategy to harness novel complexity had vertical negative consequences for the overall company strategy. Findings thereby describe how strategizing for institutional complexity is simultaneously shaped by the company strategic apex and emerging from strategizing within everyday interactions of multiple managers at the middle and their followers. This accentuates the need of exploring unanticipated emergence of actors’ ongoing reworking strategy (Lê & Jarzabkowski, Reference Lê and Jarzabkowski2015). In terms of strategic consequentiality (cf. Jarzabkowski et al., Reference Jarzabkowski, Kavas and Krull2021), the company’s strategy of integrating new complementary to old logics to achieve high performance and legitimacy in a period of macro institutional reform was due to the distributed re-strategizing not fulfilled.
Discussion and concluding remarks
The current article provides insights into how strategizing is accomplished in situations of considerable institutional complexity, which we believe constitutes an interesting venue for studies wishing to bridge recent scholarship on strategizing and on institutional reform. An overview of the present study’s theoretical contribution to the research fields of organizational responses to institutional complexity and strategizing across organizational levels are displayed in Table 4.
Table 4. Overview of study contributions
Thetable provides an overview of respectively research on institutional complexity and strategy-as-practice and the present study’s contributions based on combining this research.
The arrows in the column of study contributions display lateral and vertical dynamics of strategizing practices for institutional complexity.
In terms of theoretical implications, a range of analytical opportunities may arise from engaging a practice lens in studying strategy for institutional complexity as a social accomplishment:
First, the current study combines institutional research showing that responses to institutional complexity are formed across strategic and operational levels (Demers & Gond, Reference Demers and Gond2020; Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Olsen & Solstad, Reference Olsen and Solstad2020; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015), and SAP research calls for investigating strategizing practices for institutional complexity as a social accomplishment (Jarzabkowski et al., Reference Jarzabkowski, Seidl and Balogun2022; Kohtamäki et al., Reference Kohtamäki, Whittington, Vaara and Rabetino2022; Rantakari & Vaara, Reference Rantakari, Vaara, Courpasson and Vallas2016; Rouleau & Cloutier, Reference Rouleau and Cloutier2022). In responding to this, the present article findings provide insights into middle managers’ re-strategizing for institutional complexity as socially distributed practices, across organizational levels. Such strategizing practices were performed by middle managers in vertical dynamics of reworking strategies adopted at the organizational top. The middle managers’ aim was to influence their vertical interactions with followers to improve performance. This is in accordance with prior research on the central role of middle managers in terms of strategizing (Birollo & Teerikangas, Reference Birollo and Teerikangas2022; Rouleau et al., Reference Rouleau, Balogun, Floyd, Golsorkhi, Rouleau, Seidl and Vaara2015), and in responding to institutional complexity (Malhotra et al., Reference Malhotra, Zietsma, Morris and Smets2021; Olsen & Solstad, Reference Olsen and Solstad2020). Correspondingly, the study demonstrates how middle managers, to various degrees, enacted a special position and power in the strategic management of institutional complexity, as compared to more ‘ordinary’ professionals at the frontlines. However, in turning the practice lens back upon strategizing, we supplement this by emphasizing that middle managers could not entirely control the strategies and emerging logic constellations of their own nor the other teams. The strategizing of middle managers was met by followers’ counter actions, which influenced the constellations of logics. This highlights the diffuse and polyphonic character of distributed strategizing practices (MacKay, Chia, & Nair, Reference MacKay, Chia and Nair2021; Vaara & Whittington, Reference Vaara and Whittington2012). Adding to this, our findings accentuate that the followers too made use of ‘unsettled’ prioritization of institutional logics to rework the strategies. Thus, our study warrant attention beyond managerial strategic activities and instead toward the distributed practices of strategizing for institutional complexity.
Second, the study responds to calls for a deepened understanding of strategizing practices as situated in local social relationships as well as the broader institutional context (Hung & Whittington, Reference Hung and Whittington2011; Jarzabkowski et al., Reference Jarzabkowski, Kaplan, Seidl and Whittington2016). Practice-based accounts demonstrate how practical understandings are involved in straddling competing demands in the face of the situational exigencies of professionals’ everyday work (Smets & Jarzabkowski, Reference Smets and Jarzabkowski2013; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015; Tarakci et al., Reference Tarakci, Ateş, Floyd, Ahn and Wooldridge2018). Research has addressed for which practical reasons individuals balance complexity, in terms of getting work done or coping with work, and how they do it (Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Jarzabkowski et al., Reference Jarzabkowski, Smets, Bednarek, Burke and Spee2013; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015). We add insights into for whom and for what situated reasons balancing institutional complexity might be done. In the present study, the managers’ reworking logic constellations were informed not only by practical understandings about how to effectively get professional work tasks done. Their strategizing institutional complexities also concerned struggles for resources and personal careers, which were highly influenced by the novel capitalist logics underpinning company strategies of individual performance while sustaining Confucian family-like harmony. Middle managers operated between different expectations to manage and contribute to organizational strategies from above, by holding some formal responsibilities for realizing the organizational strategies of balancing capitalist and Confucian logics. Yet often they did so while struggling for their personal careers and resources, in a growing competitive setting, even at the expense of a smooth workflow. These insights advance understandings of how individuals’ engagement with institutional logics is oriented by personal agency not accounted for by the formal work or strategic role they occupy. This suggests that, in a practice lens, leveraging institutional complexity in everyday work is informed by a broad range of situated agency and personal reasons.
Third, previous research predominantly focuses on groups of managers or professionals and how they balance institutional logics (Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Olsen & Solstad, Reference Olsen and Solstad2020; Smets et al., Reference Smets, Jarzabkowski, Burke and Spee2015). However, combining this with research on lateral interactions over strategies among middle managers or professionals (Jarzabkowski & Bednarek, Reference Jarzabkowski and Bednarek2018; Reference Jonasson, Mette and Shubhra2018Tarakci et al., Reference Tarakci, Ateş, Floyd, Ahn and Wooldridge2018), our study supplements with knowledge on the emergence of highly interdependent practices of strategizing institutional complexity. The middle managers’ diverging practices emerged due to the company’s strategic aim of harnessing institutional complexity and harvesting its possible benefits by logic combinations of American- and Korean-style. This company strategy thereby did not entail complexity-reducing measures but rather ‘unsettled’ responses to institutional reforms (Raynard, Reference Raynard2016). This paved the way for pluralistic strategizing practices. Moreover, the findings suggest that diverse practices of strategizing institutional complexity moderate each other laterally. Specifically, the study showed how one manager could bring another manager’s practices of strategizing logics out of balance with severe and unanticipated consequences for harnessing institutional complexity strategically. Similarly, vertical dynamics of top and middle management and their resisting followers had emerging consequences for the company performance. Strategic practices in the face of institutional complexity are thus accomplished in interwoven, ongoing lateral and vertical activities. Such practice emergence has attracted less attention by previous research of both institutional complexity and SAP (Lê & Jarzabkowski, Reference Lê and Jarzabkowski2015), although recent calls have been made for investigating dynamic interactions in multidirectional strategy formation (Burgelman et al., Reference Burgelman, Floyd, Laamanen, Mantere, Vaara and Whittington2018).
Finally, we suggest that paying attention to the vertical and lateral dynamics of distributed, situated, and emerging practices of strategizing for institutional complexity is important for understanding their strategic consequences. The findings show how middle managers’ strategizing led to vertical effects both within and beyond the local setting, whereby the company strategic aim was compromised. We thereby complement recent research on the strategic role of middle managers (Birollo et al., Reference Birollo, Rouleau and Teerikangas2023; Birollo & Teerikangas, Reference Birollo and Teerikangas2022; Heyden et al., Reference Heyden, Fourné, Koene, Werkman and Ansari2017; Van Rensburg, Davis, & Venter, Reference Van Rensburg, Davis and Venter2014) with insight into unintended upward consequentiality. It is thus relevant to not only characterize certain strategy roles or typologize different strategies of responding to institutional complexity. Instead, we suggest that taking departure in strategizing as a social accomplishment can provide novel insight into why and how organizational responses to institutional complexity do not always lead to harvesting neither legitimacy nor performance benefits.
Limitations
The study comes with some central limitations. First being a single case study, it does not allow generalization of our findings. Nevertheless, we suggest that future studies of organizations facing institutional reform might investigate the situated, distributed, and emerging practices and consequences of strategically responding to such reforms. Second, the study takes place in a particular Korean context, and other institutional fields might comprise vastly different constellations of institutional logics. Nevertheless, similar ‘unsettled’ field-level prioritization may be found across different fields (cf. Høiland & Klemsdal, Reference Høiland and Klemsdal2022; Raynard, Reference Raynard2016). We therefore suggest that future research investigates the consequences of the vertically and relationally distributed re-strategizing of such unsettled prioritization in other institutional fields of institutional complexity. Finally, we have responded to calls for investigating how complex vertically and laterally dispersed practices may be consequential to the formation of strategies (Jarzabkowski et al., Reference Jarzabkowski, Kavas and Krull2021). However, a shortcoming of our study is that the consequences we trace are rather momentary in time. There is thus a need to investigate the consequences of strategizing for institutional complexity in a longitudinal, processual perspective.
Practice implications
Findings from the study have some practice implications for management and institutional decision-makers. Regarding the latter, while reforms, being financial, political, and/or societal, might forcefully be bestowed upon an institutional field, our findings show the complexity emerging from multiple logics in the field. Such institutional complexity might create severe tensions but also serve as a strategic resource. We therefore suggest that when facing reform, there is a need for managerial and policy decision-makers to pay attention to the myriad of strategic responses from various organizations in the field and multilevel factors contributing to such responses. Here, attention should far from only be given to the top CEO level strategizing but to organizational responses at different levels and in various dynamics of interaction. This is important because understanding such vertical and lateral dynamics of strategizing for institutional complexity might explain why some organizations struggle to sustain their strategic and field-level competitive edge under reforms. Nevertheless, it remains important to pay attention to top management strategies in ‘unsettled’ fields of institutional logics as this might create a particular space for reworking strategies in multiple, yet interdependent, ways. Regarding strategy consequences, attention should not merely be given to the strategic consequences of intended manager activities. Rather, strategizing institutional complexity is in the hands of several actors, who, besides holding formal roles and responsibilities are part of already existing relations and power structures. Here, strategizing not only serves purely organizational ends but as much personal ends to achieve various goals – even through competition. Such situated dynamics of employees and fellow managers’ interactions might therefore induce highly unanticipated, and for the overall company unintended consequences. Overall, we suggest that managers and decision-makers pay careful attention to strategizing for institutional complexity as a rather resource demanding social accomplishment.
Conflict of interest
The authors declare none.
Charlotte Jonasson’s research interests comprise organization and management in complex contexts and cross-cultural management. She has recently conducted research within fields of virtual work and digitalization leadership.
Toke Bjerregaard’s research revolves around the work of strategizing and organizing in complex settings. He has a keen interest in institutional and practice theory and recent studies focus on grand societal changes in and across organizations.
