Adoption of management innovation: an organizational learning perspective

Institutional theorists have generally focused on the role of social and cultural characteristics of the external environment that motivate and facilitate the diffusion of management innovations (MIs). However, most studies have treated innovation as a discrete phenomenon and have not examined the variability of innovation adoption over time. MI, characterized by flexibility, variability, and continuity, necessitates probing into the “Iron Cage” to describe a more complete image of institutional change. Based on insights from the behavioral theory of the firm (Cyert & March, 1963), this dissertation focuses on the dynamic process that determines organizational responses to institutional pressure. It is composed of three studies which deal with the population-level diffusion, individual-level adoption, and field-level isomorphism of MI practices respectively. The empirical setting is the adoption of alternative types of public service delivery in U.S. local governments. Information on service delivery was obtained from the International City/County Management Association’s (ICMA) surveys of local governments’ service delivery choices in 1982, 1987, 1992, 1997, 2002, and 2007. The ICMA data were supplemented by the data from censuses of governments and other sources. The primary method of implementing the New Public Management (NPM) movement has been the use of contractual or cooperative agreements between local governments and private sector businesses or non-profit organizations to deliver public services. Whereas the outsourcing of government services has its advocates and critics, this study posits that accompanying the NPM movement has been an institutional change from traditional to market-driven public management, where conflicting institutional models coexist. This dissertation hopes to make several contributions. First, it depicts how organizational heterogeneity is generated through path dependence, even in dealing with identical institutional change. Second, it provides a more dynamic process of institutional change by borrowing insights from the behavior theory of the firm (Cyert & March, 1963). Third, it offers a new approach to understanding the nature and process of institutional isomorphism. Demonstrating the impact of variability and flexibility pertaining to MI, this dissertation calls for holistic, balanced interpretations and applications of structuralistic, deterministic theories. Ph. D.Includes bibliographical referencesIncludes vitaby Jun L