Rethinking Deinstitutionalization: Exploring the Boundary Conditions for Abandoning and Decoupling Highly Diffused and Institutionalized Practices

Deinstitutionalization of taken-for-granted practices as a natural consequence of ever increasing entropy seems to directly contradict the major institutional thesis, namely, that over time isomorphic forces increase and, as a result, possibilities for deinstitutionalization decrease culminating in the impossibility of abandoning in highly institutionalized fields. We argue that the possibilities for deinstitutionalization have been overestimated in organizational literature and offer a revisited account of deinstitutionalization vs. institutional isomorphism and institutionalized vs. highly diffusing-but-not-institutionalized practices. A freedom for choice between alternative practices exists during the pre-institutional stage but not when the field is already institutionalized. In contrast, institutionalized, taken-for-granted practices are immutable to any sort of functional and political pressures and they use to persist even when no technical value remains thus deinstitutionalization on the basis of a functional dissatisfaction seems to be a paradox. We offer a solution to this theoretical inconsistency by distinguishing between truly institutionalized practices and currently popular practices (highly diffused but non-institutionalized). It is only the later that are subject to the norms of progress which allow abandoning and replacing of existing organizational activities. Deinstitutionalization theory is thus can be applied to popular practices that are subject to reevaluation, abandonment and replacement with new optimal practices while institutions are immutable to these norms of progress. Institutions are immutable to deinstitutionalization and the deinstitutionalization of optimal practices is subject to the logic of isomorphic convergence in organizational fields. Finally, we revisit a traditional two-stage institutional diffusion model in order to explain the possibility and likelihood of abandonment during different stages of institutionalization.