In-depth analysis of Institutional theory and assessment of key literature regarding the subject. Perfect exam preparation for international business studies.
, CASE STUDY EXAMPLES
Croucher, G. and Woelert, P. (2016). Mimetic isomorphism in the
Australian Universities. Mimetic isomorphism used to reduce risk
when facing environmental uncertainties.
Isomorphism less prevalent in commercial industries where
differentiation leads to advantage.
Hofstede insights for national context:
Power distance
Individualism
Masculinity
Uncertainty avoidance
Long term orientation
Indulgence
Mimetic and regulative isomorphisation – adoption of hybrid working after COVID 40%
started hybrid work after covid (Travel perk 2023)
(Almazrouei & Pech 2015) – Unique charactersitics in the UAE as a result of influence from
British occupation – evidence of crossvergence
Key theories/definitions
Critique of socio economic theory – high impactful change in business and society as result
of the digital revolution – if societies are embedded and complimentary – how can such big
change occur? (Brewster et al 2016). The interaction and cross vergence of different cultures
creates change that contradicts the theory that organisations always respond the same way
to the same forces – talked about by (Whitley 1992) and (DiMaggio and Powell 1983).
Example – 90% private sector workers in Sauid arabia are foreign nationals (
Culture – (Hall 1997) a sum of a people’s learned behaviour, patterns, and
attitudes.
Institutional theory – firms in markets observe and imitate eachother
as a way of minimising risk and replicating the success of others
Critique of this theory – firms behave differently depending on the
industry. Sometimes imitation may occur – but this is more prevalent in
industries of the social sector (Croucher, G. and Woelert, P. (2016) is
an example). – where a benchmark of a product/service is set by
customer expectations, and also heavily governed by overseeing bodies –
such as the government – which set rules an guidelines for firms to
follow.
This is very different to private sector industries where imitation is not
wanted and differentiation is desired. In industries such as the automobile
market, firms innovate to differentiate from competitiors, by offering
products that are different to the rest of the market. This is done to stand
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