Individual Perceptions and Responses to Competing Institutional Pressures

Helle Holm Bjerring

Student thesis: Master thesis

Abstract

Literature has proved that organisations are subject to institutional duality and struggle to achieve both internal and external legitimacy. Simultaneously, they are faced with competing institutional pressures, which they have to adhere to. In order to advance institutional theory, this thesis explores how individuals within MNCs perceive and respond to competing institutional pressures in a hostcountry environment with regards to culture and Human Resource Management practices. The study builds on the premise that organisations consist of heterogeneous individuals with subjective values and norms, calling for a deeper exploration of micro-foundations. By analysing the perceptions of various institutions; regulatory, normative, and cognitive, it becomes clear that employees working abroad and the people working and representing the headquarters put different emphasis on the various institutions. Findings reveal that individuals in host-country environments mostly address the normative and cognitive institutions due to their accessibility and knowledge about these institutional logics. The headquarters, on the other hand, mostly focus on the regulatory institutions. It is argued that this difference is because of different degrees of self-awareness and cultural awareness, due to the fact that awareness is a precondition of one’s perception of it. Furthermore, the thesis concludes that individuals mostly respond with compliance and combination, whereas the headquarters usually respond with ignorance or manipulation. The reason for this is awareness as well as different cultural expectations, level of identification, personal values, historical explanations and desire to achieve legitimacy. From bringing agency into the picture and applying an individual level analysis, the thesis contributes with a new angle to institutional theory and provides empirical evidence of individuals’ perceptions and responses to competing institutional pressures. Moreover, from the assumption that individuals respond to competing pressures depending on how they perceive them, examining what determines how individuals perceive institutional pressures will aid in enhancing our understanding of organisational responses to institutional complexity

EducationsMSc in International Business and Politics, (Graduate Programme) Final Thesis
LanguageEnglish
Publication date2015
Number of pages294