cohort replacement and institutional change

Institutional theorists have become obsessed with explaining sources of institutional change in organizations. During neoinstitutional theory’s rise to prominence, it was mostly a theory of stability and homogenization of society, but in the last decade or so more and more institutional scholars have started focusing on change dynamics. There are some obviously good reasons for this, including the purpose of making institutional theory a more useful tool. Theories of institutional change often try to find endogenous explanations, e.g., institutional contradictions, competition between institutional logics. Still most of these explanations, because they give primacy to higher-level processes, ignore what’s going on at the ground level or at least fail to take into account the processes whereby people change their beliefs, adapt values, and alter their identities to make room for a new institutional practice.

In our rush to generate endogenous explanations for institutional change, it seems that some of the obvious micro-level processes of institutional change have been ignored. This research completely ignores the people whose “hearts and minds” must change in order to actually create lasting institutional change, even though for a new routine to become institutionalized people have to put it into action and for a new policy to be seen as “legitimate” people have to be convinced of the policy’s appropriateness. Perhaps the lack of emphasis on these micro-dynamics is the result of methodological biases. Demographic analysis, public opinion research, and experimental methods are mostly outside the toolkit of most institutional theorists. And yet, there’s probably a lot we could get from these analyses.

One potentially very important mechanism of institutional change is cohort replacement. By that I mean the replacement of old guards of organizational members and leaders with newer cohorts who have different beliefs, opinions, and values. It’s strange, when you think about it, that institutional theorists haven’t considered in any serious way how cohort replacement affects organizational practices and policies, even though opinion research indicates that cohort differences explain significant variation in beliefs and attitudes. Cohort differences may often matter more than life stage differences in explaining political opinions and attitudes. Take the case of liberalizing beliefs about same sex marriage. One study indicates that about half of the growth in support for same sex marriage is the result of cohort replacement. Younger generations are simply more open to this practice than preceding generations. We can expect that in a couple of generations, same sex marriage will be legal everywhere due to cohort replacement.

How might cohort replacement explain organizational change? One way to examine this would be to look at how demographic differences across organizations explain openness to new policies/practices or rates of early adoption. Another fruitful path would be to explain how cohort replacement creates identity conflict in organizations, a potentially crucial source of friction underlying change. Cohorts, in this sense, could be conceptualized as the carriers of different identities and logics. A nice illustration of this type of research is Nancy Whittier’s 1997 ASR paper about micro-cohorts and the transformation of the feminist movement. Even though the paper is often cited as an important illustration of how collective identity matters in movements, I think it’s undervalued as a study of institutional change.  Another potential line of investigation would be to examine the link between cohort replacement and selection processes at the field level-of-analysis.  One of my students pointed out to me yesterday that Haveman’s and Rao’s 1997 AJS paper on the thrift industry relies to an extent on the imagery of cohort replacement to explain why certain forms of thrift were selected.

More generally speaking, there should be a stronger link between research on organizational demography (e.g., see Damon Phillips’s work on law firms; Heather Haveman on managerial tenure) and institutional theory. Obviously, rates of entry and exit of managers affect organizational processes. The question for institutional theory is, how do these demographic changes affect institutional stability and heterogeneity?