Controlled, Verified, and Understood

Abstract

Organizations, like individuals, are faced with the task of constructing an identity. To attract investors and consumers, a firm needs to develop a sense of “who we are” and “what we do.” Yet audiences may come to see the firm differently from how it desires to be seen. We address this alignment problem with a case study of the U.S. market for higher education. Identity verification is core to the research on individuals but peripheral in the literature on organizational identity, which instead focuses more on strategic identity construction. We use a network approach to capture both how schools view themselves (e.g., Yale nominates Princeton as a peer) and how the market responds (e.g., many schools view Yale and Princeton as peers). Results show that prestigious schools are more likely to (1) construct tightly controlled identities, (2) experience reciprocated nominations, and (3) define themselves in a manner consistent with the market’s response.