Under pressure from conflicting institutional demands and time in inter-institutional temporary organizations

a theoretical exposé and empirical investigation

Assistant Professor, Department of Organization Copenhagen Business School

Jonas Söderlund, PhD

Professor, Department of Leadership and Organizational Behaviour BI Norwegian Business School

Abstract

Institutional rules and regulations play an increasingly important role in modern society: They guide individual and collective action and ensure efficient processes of collaboration. However, more and more collaboration cuts across organizational fields, which in some cases poses fundamental challenges to collaboration efforts. This is perhaps particularly noteworthy in the context of temporary organizations that are set to govern collaboration across sectors, private-public boundaries, and professional domains. However, so far, research on the organizational impact of institutional demands has failed to address the inherent dynamics of such collaborations. This paper addresses, through the use of a unique and explorative qualitative case study, how the three elements of institutional demands—cultural-cognitive, normative, and regulative—are unfolding and evolving in inter-institutional temporary organizations. The study addresses the integration and disintegration of logics and normative orders in an ongoing process characterized by co-mingling, co-existence, creation, and resolutions of hybrid logics and creation of institutional exceptions throughout the life of the studied temporary organization. In that respect, this paper contributes with a more nuanced view on the evolution, dynamics, and co-existence of pressures from multiple institutional demands at the organizational level.

Keywords: inter-institutional temporary organizations;, institutional demands; healthcare

Introduction

“Pressure pushing down on me
Pressing down on you…
Under pressure we’re cracking”
(“Under Pressure,” David Bowie and Queen, 1981)

Organizations are often under pressure from multiple and, sometimes, conflicting institutional demands (Friedland & Alford, 1991; Hargrave & Van de Ven, 2006; Pache & Santos, 2010; Scott, 2004), which is perhaps especially true for large-scale temporary projects (Scott, Levitt, & Orr, 2011). Organizing through projects implies transcending established routines and standard operating procedures and collaborating with people representing a range of knowledge bases and organizational units (Dille & Söderlund, 2011). Large-scale projects have been singled out as a solution to all kinds of societal and technical problems. Projects are supposed to contribute to creating innovative infrastructure and building collaborative and sustainable meta-organizations. The integration of diverse knowledge and contrasting viewpoints therefore typically stands at the fore of modern large-scale projects. This rapid knowledge specialization in a wide range of societal sectors typically leads to gradually greater complexities at the project level (Scott et al., 2011). Handling this greater complexity and increased heterogeneity could be seen as the ultimate rationale of organizing by projects and also an important driving force for the increasing part played by large-scale projects in modern society. However, handling the pressure and expectations is far from trivial. As several empirical investigations have documented, this often results in organizational breakdowns involving excess interdependencies concerning roles and extreme coordination costs (Flyvbjerg, Skamris Holm, & Buhl, 2003; Scott et al., 2011).

Dille and Söderlund (2011) discuss the idea of the inter-institutional project as a particular kind of temporary organization situated “in complex, diverging, and fragmented institutional environments that involve actors from multiple organizational fields” (p. 483). This results in institutional pluralism, which poses a number of challenges in matching and coordinating across institutional demands (Dille & Söderlund, 2011). Dille and Söderlund argue that such projects most likely will give rise to severe frictions, conflicts, and opportunistic behavior that may endanger the entire life of the temporary organization (Orr & Scott, 2008). Empirical research on inter-institutional projects is still rather limited. Most often, institutional dimensions are only analyzed in passing (for example, see Grabher, 2002; Grabher, 2004; Grabher & Ibert, 2011; Newell, Goussevskaia, Swan, Bresnen, & Obembe, 2008; Whitley, 2006). Indeed, there are a few exceptions, such as Scott et al. (2011), who conceptually investigate the institutional environment of global projects; and Henisz, Levitt, & Scott (2012), who propose a conceptual framework of project governance. Both those studies are based on Scott’s three institutional pillars (i.e., the regulative, normative, and cultural-cognitive elements). Dille and Söderlund (2011) investigate the relation between time and diverging institutional requirements and elaborate on the effects of isochronism, which highlights how organizations within the same organizational field come to resemble each other in the tempos and phases of their activity cycles. In addition, Orr and Scott (2008) investigate how institutional differences are translated into cross-border projects, and Bresnen and Marshall (2011) examine what happens when a new “public-private-partnership” logic (i.e., a PPP project mode of organizing) enters the construction industry. However, there is more to be said about the nature and dynamics of inter-institutional projects and about the specific reasons behind their frequent breakdowns.

In many ways, inter-institutional projects could be viewed as a particular kind of hybrid organization; they combine different institutional logics in unique ways (Battilana & Dorado, 2010) and, in some cases, operate under institutional exceptions (Orr & Scott, 2008) to manage the pressure from multiple institutional demands. In this paper, we are interested in how temporary organizations respond to conflicting institutional demands under severe time pressure. Due to the temporary and dynamic nature of projects, especially their explicit deadlines and in-built beginning and end points, this paper draws on ideas from institutional theory that focus more on processes of institutional change than on conditions of stability and isomorphism (Bresnen & Marshall, 2011 Colyvas & Powell, 2006; Lounsbury, 2007; Orr & Scott, 2008; Reay & Hinings, 2005). We use the notion of institutional demands including regulatory regimes, normative orders, and cultural-cognitive logics (Friedland & Alford, 1991; Pache & Santos, 2010; Scott, 2012) to investigate the process of co-existing, co-mingling, cracking, and clashing institutional demands in these organizations. The focus of analysis is the project process.

Aligned with Phillips, Lawrence, and Hardy (2004) and Orr and Scott (2008), we shift attention from outcomes and impacts (what happened?) to social process (how did the observed effects occur?). We are interested in how potential institutional exceptions and hybrid logics are shaped within temporary endeavors. We thereby assume that nothing ever really stays the same: Involved things and actors change and move. Institutional theory assumes that institutional orders and their logics exist and that organizations and actors operate under their pressures (Thornton, Ocasio, & Lounsbury, 2012). For example, in the empirical context addressed here involving construction works, it is commonly assumed that a professional regime will guide the architect in the design of a facility that meets the client’s needs and requirements. Moreover, it is assumed that the architect’s professional logic is under dual pressure regarding efficiency (engineer-manager) versus aesthetic (artist-entrepreneur) logics (Thornton et al., 2012). The two logics will get different possibilities and acceptance to flourish and prosper depending on the context in which the actor is embedded. In this study we assume that different institutional orders and logics may exist. Our aim is to investigate how conflicting institutional demands drive negotiations manifested through differences in how actors talk, write, use symbols and artifacts, and make sense of these discourses (Phillips et al., 2004). Furthermore, this research addresses how hybrid forms or institutional exceptions emerge from dialectic negotiations and interactions in the project process. Accordingly, we seek to answer the following research question: How are conflicting institutional demands unfolding in temporary inter-institutional organizations?

This paper presents findings from an in-depth explorative case study of a large-scale project—the construction of a new major hospital in Sweden. The paper is structured in the following way: First, we present the theoretical foundations and a short review of the literature on institutional demands with the focus on inter-institutional projects. Second, the methodology and the case are presented and analyzed. Finally, a discussion is provided, which is followed by conclusions and implications.

Institutional Demands

Institutional theory addresses the processes by which social structures, including both normative and behavioral systems, are established, how they become stable, and how they undergo changes over time (Scott, 2012). Studies on institutions therefore try to understand social structures by investigating similarities and differentiations in social settings, the relation between structure and behavior, the role of symbols in social life, the relation between ideas and interests, and the tensions between freedom and order. The levels of analysis range from the broader societal and institutional level to the organizational and interpersonal relational level (Scott, 2004; Scott, 2012). One branch of studies in this field focuses on institutional logics.

The original idea of institutional logics was to bridge the gap between macro structural perspectives and micro process attempts in institutional theory (Friedland & Alford, 1991; Jackall, 1988). At their core, the institutional logics reflect the content and meaning of institutions. Institutional logics are thereby socially constructed, reflecting historical patterns of practices, values, beliefs, and rules that guide individuals in their day-to-day interactions and decision-making (Friedland & Alford, 1991; Lounsbury, 2007; Thornton & Ocasio, 1999). Individuals are suggested to be exposed to a number of institutional logics at different levels (Thornton & Ocasio, 1999). For example, on the societal level, individuals are exposed to cornerstone institutions such as family, religion, and market, which provide cultural symbols and practices (Friedland & Alford, 1991; Pache & Santos, 2013). On the organizational field level, indoctrination of collaborative organizational members into certain values, goals, and practices happens through logics-reinforcing activities such as education, conferences, club membership, and so on (Pache & Santos, 2013). On the organizational level, depending on the status of the organization, the governance system may either strengthen or protect its members from the organizational field logic (Friedland & Alford, 1991; Pache & Santos, 2013).

The multiple logics that people are exposed to are sometimes competing (Friedland & Alford, 1991), overlapping, and/or contradictory. Jensen, Kjærgaard, and Svejvig (2009) argue that detailed knowledge of how individuals and organizations choose between available logics is missing. Research on logics thus tries to understand, for example, how groups and individuals are bound by social constraints the logics give rise to, how individuals and organizations accept competing institutional demands in practice and the impact of experience and learning on this process (Pache & Santos, 2013; Smets & Jarzabkowski, 2013), and how competing logics interact and shape practice diffusion (Lounsbury, 2007). In that respect, studies on institutional logics may not only provide the missing link between macro and micro levels but also emphasize the concepts of meaning that Suddaby (2010) argues have disappeared in recent works on institutional theory.

Much research on institutional logics and their interplay still focus on the permanent organization in longitudinal studies; for example, see Lounsbury (2007), Pache and Santos (2013), and Smets and Jarzabkowski (2013). In permanent inter-institutional arrangements, such as alliances and joint ventures (Jones & Lichtenstein, 2008), new “local” logics may be created (Thornton & Ocasio, 1999) with hybrid properties. But what about the temporary nexus offered in projects: Can specific inter-organizational logics be developed, or will logics solely co-exist and co-mingle in these endeavors? In this study we focus on complex inter-institutional projects under pressure from multiple institutional demands. These demands include regulative rules, normative orders, and cultural-cognitive logics that may create institutional exceptions (Henisz et al., 2011; Orr & Scott, 2008; Scott, 2012).

Institutional exceptions are suggested to be accidental deviation from established institutions. These deviations may bring more or less costly consequences for the entrant organization. Exceptions can be created for regulatory, normative, and cultural-cognitive elements (Orr & Scott, 2008). Orr and Scott (2008) investigate the creation of institutional exceptions in global projects. They describe these institutional exceptions as something that happens when an entrant is entering a host’s sphere. Each episode of institutional exception is viewed as a learning episode where managers, with growing experience, become more skilled in avoiding and resolving exceptions. An institutional exception is thereby not regarded as a good thing, but rather a costly phenomenon that should be avoided (Orr & Scott, 2008). However, in temporary organizations operating under the pressure from time and multiple and sometimes conflicting institutional demands, could it be that institutional exceptions, materialized through the creation of hybrid logic, for example, in fact are the rule rather than the exception? Could it be that these exceptions are a necessity rather than something vicious in order to succeed with the project task?

Institutional Pressures in Temporary Organizations

In this section we will draw on the three institutional pillars—regulatory, normative, and cognitive-cultural—and connect them to the pluralistic institutional environment large-scale projects are exposed to. Institutions comprise multiple elements that when aligned produce resilient social systems and when misaligned offer important triggers and levers for social change (Scott, 2012). Rules, norms, and beliefs are thus symbolic representations until being materialized into social behavior. More specifically, the three pillars involve regulative elements such as formal regulations, laws, and property rights. In this setting this involves, for example, public-private partnership, national standards, environmental laws, etc. Normative elements involve informal norms, values, standards, and roles—for example, standards provided by professional associations such as, among others, the Project Management Institute (PMI), International Project Management Association (IPMA), and International Organization for Standardization (ISO) on the institutional field level. Cultural-cognitive elements comprise shared beliefs, identities, and logics of action—for example, identifications with a certain occupation, organization, and practice (Misangyi, Weaver, & Elms, 2008; Orr & Scott, 2008; Scott, 2004; Scott, 2012). In a large-scale project this implies that participants may be exposed to distinct institutional orders driven by the market, the profession, the state, the community, and the corporation (Thornton et al., 2012) and materialized through logics such as “human right,” “conservation”, “development” (Scott, 2012), “service,” and “management” (Grabher, 2004). Implying, for example, that a project team member may identify himself/herself with the quality of work logic, get authority through the professional logic and believe that work is legitimized by personal expertise. But in the same time may be part of a corporation logic, where status is given by hierarchy and work is legitimized by whether it increases the firm’s market position. Moreover, the team member is acting on a market where increased efficiency is the status and self-interest the basis of the norms. (Thornton et al., 2012). The team member is thereby acting under a number of institutional pressures, which we believe is put to the test when collaborating with other team members with distinct institutional pressures under severe time constraints in a temporary organization.

Inter-organizational collaborations involve processes of negotiation to overcome the unstructured nature of collaborative relationships, and this results in the construction of new institutional forms (Phillips, Lawrence, & Hardy, 2000), such as new norms and beliefs. Yet, the temporal dynamics of projects have been found to influence collaborative activities among independent organizations (Jones & Lichtenstein, 2008). Recent research has highlighted that logics often demonstrate distinct perceptions of time (i.e., tempo and timing) that is, distinct values and logics of actions in relation to tempo and timing in the project process (Dille & Söderlund, 2011). Most notably, participating organizations involved in mega projects have been found to have different time logics concerning the speed and timing of activities, which generally makes it challenging for managers to avoid pace clashes in the project (ibid.). Indeed, the time dimension involves more aspects than just tempo and timing. Engwall (2003) demonstrates that, despite their unique, one-off, and time-limited characteristics, temporary organizations are impacted by their history and present, ongoing context. This generally means that even though a temporary organization is new to its team members and their organizations, many of the participants have considerable experience in collaborating and negotiating with participants adhering to diverse professional and organizational logics and institutional demands. It is likely that such experience constitutes an important resource that participants can draw upon when establishing new collaboration patterns in the present action locality. Further, there exist no facts about the future, only more or less adequate guesses, and therefore the future possesses an inherent unknowability and uncertainty (Winch & Maytorena, 2012). The individual’s perception of the degree to which the new logic will serve their own present and future interests will impact their willingness to change or abandon a presently adopted logic (Reay & Hinings, 2005).

Institutional demands are thus not timeless but rather characterized by different time temporalities such as past, present, and future, as well as time in the sense of pace and tempo. We suggest these time dimensions will provide a certain degree of agility, which will materialize when conflicting institutional demands interact, potentially find their equilibrium or hybrid form, or create an institutional exception in the inter-institutional project process.

Research Methodology

This research adopts an explorative, qualitative, single-case-study approach. In general, case studies provide context-dependent insights and are therefore excellent for identifying “black swans” (Flyvbjerg, 2006a) and for reporting “talking pigs” (Siggelkow, 2007), which quantitative studies may disregard. Case studies may thereby help researchers in a field to go from beginners to experts, as they provide rich, in-depth data about a specific phenomenon in a certain context (Flyvbjerg, 2006a).

Case Selection and Presentation

The case was selected because it was expected to be an unusual case (i.e., an extreme case selection strategy) (Flyvbjerg, 2006a). The case project under study is regarded as unusual and extreme, as it was the largest PPP project in the world in the healthcare sector, worth 52 billion SEK (approximately 8 billion USD) at the time of procurement. The studied project can be considered a mega infrastructure project involving a new hospital system, a new organization, and a new collaborative practice (Davies, Gann, & Douglas, 2009; Flyvbjerg, 2006b). The project was initiated as an important catalyst for change of the entire healthcare system and is thereby under the governmental pressure of contributing to an overall political mission. Studying this project is in itself important considering the importance and uniqueness of the project; in that respect we set out to accomplish an empirical aim with this paper. However, our primary aim is theoretical: linking institutional theory with the notion of a temporary organization. We believe this case is particularly relevant for such an endeavor.

The healthcare sector is a complex sector with enduring conflicting demands (Pache & Santos, 2010; Reay & Hinings, 2005), which creates an extra challenge for the project team concerning, for instance, managing stakeholders’ diverging interests and goals. The project involves a new hospital building—a transformation of the healthcare service in the whole municipality—to achieve advanced efficiency. Some features of the project include, a state of the art power supply system, two helidecks, 320,000 square meters in five buildings, 600 beds, 100 daily beds, one patient hotel, 6,000 employees, and 1,000 researchers and students. The project further implies that the tenderers will build and operate the facilities (i.e., refurbishments and operations) over a period of 30 years after the building completion date. Moreover, PPP initiatives are extremely rare in the healthcare sector (and rather uncommon in Sweden, where the case is set), and this is the first instance of a PPP project in the healthcare sector in Sweden and the first instance of a large-scale PPP initiative in Sweden. Previously, it had mainly been tested in smaller road and railway projects. We therefore suspected that it would: 1) be a multi-institutional setting with potentially diverging goals and interests, and 2) involve partners with limited knowledge of working on PPP initiatives. We therefore believed this project provided an interesting arena to explore how people under time pressures and temporary conditions deal with new, unfamiliar institutional demands entering the process. In that respect, the idea was to identify and analyze a “talking pig” somewhere in this unusual setting that could tell us an interesting, credible, and memorable story (Dyer & Wilkins, 1991).

Data Collection

Data collection began in late 2012 and continued with a round of interviews during the spring and fall of 2013 when the project was ongoing. The collection was done in an inductive, explorative manner to increase our chances of finding the “talking pig.” The data was collected through document analysis and interviews. The document study was extensive, involving political documents and reports, debate articles, and newspaper articles in media, corporate documents, and reports. The interviews included open-topic questions steering the interviews to some extent through the topics of the project’s history, its critical events, and its challenges. We interviewed a total of seven representatives from the private healthcare project team, including the project manager and senior managers, as well as one representative from the public organization. The interviews lasted between one and two hours and were recorded and transcribed.

Data Analysis

The data was analyzed in four primary steps. First, a content analysis was conducted to identify emerging patterns and topics, and it was written down in a rather general and descriptive case study report. Second, discussions and email conversations based on this case study report, led to the identification of a narrower research focus and formulation of a more specific research question. Third, particular phases of the project process to include in this more focused study were extracted and selected. Fourth, the selected project processes were analyzed in more detail to identify challenging events and the present institutional logics at these events. This was done with the aim of investigating whether the presence of multiple logics appeared to have an impact on the identified challenging event and, if so, how people had dealt with them in the project. In other words, for every identified event, the past, present, and future implications of identified logics were analyzed. The purpose of this was to identify any possible signs of co-existing, co-mingling, or development of a hybrid logic or institutional exceptions—that is, the materialization process of conflicting institutional demands in the project were investigated.

The Story of the 21st Century Hospital

Early in the 1990s, politicians in Sweden began to discuss a new vision for the country’s healthcare sector. A number of investigations and reports were issued, and a decade later the idea of a new hospital facility was born. In 2005, an architectural competition was announced and the competing architects were encouraged to submit not only a design but also a description of the facility’s identity and interplay with the surrounding area. They were also asked to illustrate how the area, the buildings, and the rooms may be used over time for healthcare, research, and education. Five architects were prequalified, and a winner was selected in 2006. A programming phase involving more than 300 participants from the healthcare sector was completed and accepted in March 2008. A decision was made the same day to go ahead and construct the building. A Public Hospital Construction Organization with 30 people was assigned in May to ensure that the hospital was constructed (see Figure 1). Two months later the highest political decision-making body decided to organize the project as a PPP initiative. The procurement phase lasted for 18 months and was initiated through an open meeting in October 2008 to present the project for interested partners. More than 100 companies turned up. The meeting was also the starting point of the pre-qualification procurement phase. Forty-seven companies announced their interest and were given procurement application documents. Only one of the 47 initially interested partners submitted the application before the pre-qualification phase closed in December of the same year. The submitted application was evaluated and accepted three months later. The program (the outcome of the programming phase), involving requirement specifications concerning the healthcare organization, technical, service, and design, was sent out to the winner. This was the start of the third phase of the procurement—the actual procurement phase that lasted for approximately six months. This is also the starting point of our story of the making of the 21st century hospital (see Figure 2 for an overview of the major phases and events in the case story).

Why do we begin our story here? Because an election was approaching and the public side was afraid that if the opposition won they would cancel the whole project and conduct the project as a standard procurement, not as a PPP project. The political opposition clearly expressed its resistance and voiced many doubts about the chosen organizational and contractual model for the project. This put extra time pressure on the project. This is also the point in time when the private hospital partner consortium (PHPC) (see Figure 1) took shape, also under severe time pressures. The private consortium was 50% owned by a Swedish contractor and 50% by a UK investment corporation. The two parties had experience from previous collaborations in PPP initiatives in the United Kingdom. However, the Swedish organization had little direct experience with such a contractual model. The Swedish mother organization therefore let the private construction organization (PCO) be owned by 30% of the UK affiliation to gain potential advantages from their experiences, as the Swedes were totally inexperienced with PPP initiatives. However, this solution was not established without friction.

If we had done this again, I think organizationally we would have thought about it and executed it a bit differently. We have put a lot of time into merging the English way of doing things with the Swedish way of doing things. It has taken considerable time to get there. (Project team member A, PCO)

The organizational chart of the project setting

Figure 1: The organizational chart of the project setting.

Timeline of the project, displaying major phases and events incorporated in this study

Figure 2: Timeline of the project, displaying major phases and events incorporated in this study.

Clashing Institutional Demands Under Time Pressure

The Swedish procurement team was rather quickly assembled with people from all over the country who were considered knowledgeable and experienced in healthcare planning. The team included clinical experts and architects with specific healthcare expertise, which is a rather rare competence. Support functionaries, such as lawyers, economists, administrators, etc., were assigned to the team. The team also closely collaborated with technical consultants at the private construction organization and the private operation and maintenance organization, as the program had a significant amount of requirements concerning sustainability, life-cycle costs, and services of the building in use that impacted the space and design solutions.

The program delivered by the client was expected to involve complete drawings in the scale of 1 to 200 (drawings at the room level). However, when the team sat down and started reading the detailed descriptions of requirements in the program, they found it far from complete. Hence, the members began to draw it themselves, and they soon realized that the set space requirement was not large enough to fit all the other requirements listed in the program. The team had trusted the client to deliver what they had ordered, but they now needed clarifications and explanations of some of the solutions, especially because the list of requirements prescribed many innovative, high-tech solutions that had to be integrated in the building system. Normally there are opportunities for dialogues with the client in Sweden during the procurement phase; in this case, however, they were only allowed to have a few strictly controlled meetings with the client:

During the few meetings we had with the client, a lawyer was involved too. The lawyer decided whether it was acceptable to ask a question or not and whether the client was allowed to answer it or not. The level of secrecy was very high and we were only allowed to ask about direct technical aspects of the program. We were not allowed to have any dialogue or discussion with the client concerning, for example, different solutions or what they meant with different descriptions and requirements. Nor were we were allowed to have any contact with any team members who had been involved in the programming. So, even though all parties involved understood that there was only one partner qualified for the procurement phase, the level of secrecy was extreme. This was a consequence of the extremely tense political situation in the city at the moment. The public side of the partnership wanted a spotless procurement and management of the PPP initiative, while the opposition was so clearly and loudly against it. (Project team member B, PHPC)

The team now realized that they needed more people to be able to draw the missing links and to try to merge it all together. This was done through everlasting testing of combinations and flows in stacking diagrams, as the scope of their work first had been underestimated. In May, the private consortium had to employ every possible architect they could find and some consultants in the closest geographical area—the requirement of having only healthcare expertise in the team was impossible to maintain, as it is such a rare competence. So, the core part of the team, those with the healthcare expertise, took the decisions and delegated the assignments to the others who were less experienced in healthcare planning. At this stage the team quickly grew from five to a group of 50 architects, and the Englishmen entered the project too.

There were many cultural and professional dialects, as well as several differences in discourses, from day one. The English and Swedish architects had different educations; the English architects focused more on construction of buildings and management of projects, while the Swedish architects focus on design and end-users. The English architects are given a higher status in the UK and are required to make decisions, while architects in Sweden have a more advisory role. The Swedish architects were also not well trained language-wise and had difficulty asserting authority in English. The Englishmen therefore regarded the Swedish architects as insecure and did not trust their capacity, even though the core team of architects was very experienced and knowledgeable. So the English side of the partnership shipped over some English architects every now and then to ensure things were done correctly. Interestingly, even though the English architects were accustomed to having more say in decision-making, they were trained within hierarchical structures and used to taking orders, while the Swedes, who were not that respected as professionals in decision making, were used to consensus decision making and always questioned things. This gave rise to a lot of irritations and frustrations on both sides. Moreover, the core team of Swedes had in their previous professional lives been on study tours to the UK and read reports about UK hospitals that had significantly higher rates of infection dispersion, for example, than Swedish and Nordic hospitals. Therefore, they had developed a low level of trust in the quality of UK healthcare from a construction perspective over the years. This negative attitude was not improved during the discussions of what standard to offer in the procurement documents.

We were taken on a study tour early in the project to a newly built hospital in the London area, which they [the English architects] proudly and happily showed us. But that standard was not even discussable for this project, as we knew that our client expected higher quality than that. So we immediately had to take them to Norway to show them the new hospitals there and told them: ‘This is what we mean by high quality!’ So we spent a lot of energy trying to increase the quality, while they on the other hand were spending a lot of energy trying reducing things to fit the budget. But we were in a procurement process so we had to win and the must-have requirements were set high, and we didn’t want to lose the bid due to low quality. (Project team member B, PHPC)

The UK system of constructing healthcare facilities is built around a number of national technical standards that do not exist in Sweden. Swedish healthcare construction is governed through the national working environmental law. This resulted in an unequal situation between the Englishmen and the Swedes, as there were no possibilities or willingness to translate the whole law within the already short timeline. So even though the Englishmen provided creative and efficient solutions, these were not possible in a Swedish context due to the law. Table 1 summarizes these initial interactions and clashes between the institutional demands from the two sides. The table illustrates how two major institutional demands created an institutional exception between the Swedish and the English teams in the initial part of the bidding phase.

Phase 1 Institutional demand I: a “traditional” Swedish project Institutional demand II: an English “PPP” project
Regulative
(formal regulation, laws, property rights)
Working environment law

Hygiene prescriptions
National standards
Normative (informal norms, values, standards, roles) Service logic dominates

Focus on the client’s needs

Provide concise yet illustrative descriptions

Architects’ role rather weak: architects give advice
Management logic dominates

Focus on the contract

Provide concise yet precise descriptions

Architects’ role rather strong: architects make decisions
Cultural-cognitive (shared beliefs, identities, logics of action) High belief that the Nordic construction standard ensures high quality

Identity through association with quality of end-product that fits end-users’ needs

Source of legitimacy: Collaborative, discussing, questioning, consensus

Status: Architects do not have a high status due to their position in the professional hierarchy
High belief that the English construction standard ensures high quality

Identity through association with high-efficiency profit

Source of legitimacy: Taking orders, discussing, hierarchical position

Status: Architects have a high status due to their position in the professional hierarchy

Table 1. Phase 1: Contrasting institutional demands

Dancing with Conflicting Institutional Demands Under Time Pressure

During the process of interactions, clashes, and negotiations, the Englishmen and the Swedes successively approached each other on certain aspects as they understood and saw the other party’s strengths.

Concerning the formal aspects of the procurement, the Englishmen were fantastic, they knew how to guard certain aspects, how to write a contract that will work for an extensive period of time, including the 30 years of maintenance and operations, they corrected us when we had put in pictures that would commit us too much to follow a certain solution, etc. (Project team member B, PHPC)

But due to the inability to communicate properly concerning some of the quality aspects of the design solutions, they decided to bring in a third party from the U.S. They needed more professional advice, as they had been forced to employ architects with less healthcare experience. The Americans arrived within a couple of days, and even though the Swedish team still had to explain the Swedish laws to them, the collaboration went much more smoothly, as they were closer to the Swedes in their view on design quality and design solution in healthcare settings. The acceptance among the Swedes of the Americans’ view of quality might have had to do with the fact that the group from the U.S. included a “guru” in the field of evidence-based design in healthcare settings; the Swedes trusted his knowledge. The guru was able to communicate in a way that was appealing to the Swedes. However, the regulative working environmental law and normative patient safety order still had a higher impact on decision making than the guru’s voice—suggesting patient safety to be one of the strongest values and norms in the project.

The procurement team submitted their procurement documents on time with a list of over 300 questions concerning ambiguities in the received program, and they won the bid. Despite, or maybe because of, all the clashes, stress, uncertainties, negotiations, and hard and long working days, the group developed a very strong team spirit. No bonuses or incentives were offered; the driving force appeared to be related to the prestige of succeeding to deliver such a huge project.

This project has been extremely intensive but tremendously fun, the most fun thing I have done in my whole life… there was a spirit of ‘we will make it,’ so everyone was highly committed and worked so hard, we became a good team working together. (Project team member B, PHPC)

Table 2 illustrates how the two conflicting institutional demands started to merge into a hybrid institutional exception.

Phase 2 Institutional demand III: Hybrid institutional exception
Regulative (formal regulation, laws, property rights) Swedish work environment law
Normative (informal norms, values, standards, roles) Common value: Patient safety

English norms in how to write a contract

English norms in management logics

Swedish competence in how to design healthcare with American “guru” influence

Swedish norms in service logics
Cultural-cognitive (shared beliefs, identities, logics of action) Status and commitment from personal reputation and team feeling: We will make it!

Shared belief: This is hard but fun!

Discourse: shared definition of key words and their meanings

Table 2. Phase 2: Emerging institutional exceptions

Mingling Partners and Colliding Healthcare Demands

The hard work was not over when the second step of the bidding process was complete, but there was a great shift in the logic of doing things. The public and the private partners were suddenly allowed to discuss and have a dialogue. The public side of the partnership had to involve 100 people in order to answer the 300 questions asked by the private procurement team. People involved included clinical professionals, lawyers, engineers, economists, architects, and national and international topic experts. All the dialogues that the procurement team had wished for earlier now took place. Both public and private project parties appeared happy to enter a new partner logic without many negotiations and conflicts; they seemed relieved to finally be able to have an open dialogue, even though time was limited and the pace was fast. The private side appeared to still be “walking on sunshine” and getting strength from the perceived success of the previous project phase (it was successful in the sense that they managed to become a functioning and well-coordinated team). The ambiguities were clarified and many of the cost-reduction solutions suggested by the procurement team were rejected. This was partly due to the fact that not everyone was happy about the project; many of the end-users were rather skeptical about the new healthcare logic the politicians wanted to manifest in the new building (a “development” logic) and felt disregarded and uninvolved. Even though many had gotten the opportunity to be involved in the programming phase (the 300 people from the healthcare sector), dissatisfaction was evident. Many of the people from the healthcare sector involved in the briefing and design phases were involved due to their personal expertise not their representation of the healthcare organization that would work in the building. The end-users expressed a pride in their prestigious university hospital in its current form (a “conservation” logic). They did not see how the two logics (the old and the new hospital) could be combined. The politicians clearly wanted to create a new healthcare logic in new facilities; not the old one in new facilities. Thus:

The building will stand there, but whether we have adjusted the new organization to the new logic, that is uncertain. (chief physician, public hospital vision organization)

The new negotiations and search for final design solutions lasted for nine months before the private partner finally got the contract. The pace was even more intensive as they were, again, working under extreme time pressures, but now with more people involved, due to the fact that the political election was banging on the door. According to the board group member of the consortium, a normal timeframe for the project phase of a PPP project of this size and complexity in the UK is usually 18 months, and they had to do it in half that time.

Despite the low level of satisfaction among the people working in the university hospital organization, the collaboration in this phase was described as good among the partners:

we are partners. It is like a marriage; you cannot lie and cheat on your partner, or it will never last… I think we have had an open and good collaboration between the public and private side. (Project team member C, PHPC)

In retrospect all interviewees agree that it would have been good to have more time to define, design, and construct what they actually were supposed to build. The private side felt that, at the start of the construction, they had to take care of a lot of things that were not completed in the previous phase, and this caused some initial delays and additional costs. However, we are not there yet in our story.

Two months after the private partner got the deal, the politicians in opposition protested saying that the interest charge would be too high for the taxpayers if the private partner took all the construction costs. A decision was therefore made and executed so that the private and the public partners split the cost 50/50. So, even though the politicians were impacting the project indirectly throughout the procurement process with the upcoming election and the idea of changing the healthcare sector that initiated the project 20 years earlier, it is not until this last phase that the politicians directly impacted it.

It feels like this project to a large extent became a political play card from the start. (Project team member A, PCO)

Our story ends in the summer of 2010 when the Crown Princess of Sweden took the first dig in the ground where the new university hospital was to be built. What happened after that dig is another story.

Table 3 illustrates three institutional orders: the “partner” order, the political visionary “development” order, and the current healthcare “conservation” order.

Phase 3 Institutional demand IV: “partner” order Institutional demand V: Politicians new healthcare “development” order Institutional demand VI: Current healthcare “conservation” order
Regulative (formal regulation, laws, property rights) Dominant regulation: Working environmental law Dominant regulation: Working environmental law Dominant regulation: Patient safety regulations and working environmental law
Normative (informal norms, values, standards, roles) Strategy and basis of attention: finishing before election to avoid risk of sunk costs if the project was cancelled by the opposition

Legitimacy: Consensus decision-making
Strategy: The hospital a political question

Source of legitimacy: The hospital represents the new healthcare vision with a new healthcare logic

Basis of attention: Win the election
Strategy: Preserve our way of doing things

Source of legitimacy: Evidence-based practices and proudness of current hospital

Basis of attention: Status in profession
Cultural-cognitive (shared beliefs, identities, logics of action) Identity: Association with quality of craft and patient safety

Shared belief: No cheating between partners
Identity: Ideology

Shared belief: The hospital represents a political “identity”
Identity: quality of craft

Shared belief: Feeling uninvolved and neglected in the project

Table 3. Institutional demands in the last phase

In summary, this story, among others, has highlighted that the past, the present, and the future are inherently intertwined throughout the project. The initial search phase is characterized by a defensive “us versus them” pride dance, which was not facilitated by the asymmetry among partners concerning the understanding the Swedish work environmental law (written in Swedish only). Yet, over time this confrontational situation increasingly transformed into a curious search for understanding the used discourses, mainly through sense-making processes of the meaning of the used words, such as: What does the other side mean by ‘quality’ and ‘patient safety’? But the sense-making also involved an increased understanding of what practices the different parties used, and what their values and beliefs were in their practices. This search thereafter turned into creative negotiations regarding how to best combine the values and practices into a hybrid institutional exception. This was not possible before the actors understood the meaning of the words used. The temporality of the institutional exception was visible as it was shifted into a partner order in the next phase. Weick (1995) states that “shared meaning is not what is crucial for collective action, but rather is the experience of the collective action that is shared” (p. 42). This was to some degree true in our case, as the private side was walking on sunshine after their previous collective action. Yet, without the initial interactions that created shared definitions of the words, the collective action might have looked completely different in the last phase. Our story is thereby aligned with the idea that language is fundamental to institutionalization (Phillips et al., 2004) in our case, and fundamental for creation of institutional exceptions.

The impact of time is evident in our empirical data, not only in the sense that it is perceived as scarce, but also as institutional demands demonstrate distinct pace and timing—for example, how quickly a contract should be signed versus how much time should be given to understanding end-users’ needs; how fast and at what pace changes should be conducted in the healthcare sector (tension between the development and the conservation orders). Institutional demands in our study thereby enter the project, create institutional exception, and leave the project process on an ongoing basis and with a different pace and tempo throughout the project as new stakeholders enter the project and the project enters new sub-phases. The permanent institutional demands are thereby to some degree temporally broken free from its ordinary form.

Discussion

Our case is indeed very unique. However, at the same time it represents a typical large-scale infrastructure project in the sense that it is under pressure from political forces, which may compromise the quality of the outcome (Brady & Davies, 2010). It is complex, fragmented, and reactive (Brady, 2011), as it operates in a complex, interdependent network of firms and has to address a wide range of diverse stakeholders, regulators, customers, users, and suppliers (Gann & Salter, 2000). These stakeholders jointly create an inter-institutional setting where different actors may have different logics concerning, for example, professions, organizations, institutions, and time (Dille & Söderlund, 2011). In many ways, this is a typical example of an inter-institutional temporary organization. The nature of work in such an organization implies working in a network with complex interfaces, sometimes referred to as a “system of systems” (Shenhar, 2001). The performance of this organization is therefore highly dependent on the efficiency and interaction of the entire network (Gann & Salter, 2000). As connecting is the essence of organizing (Hernes, in press), connecting efficiently in a temporary system of systems brings a highly complex organizing task for involved parties. However, as seen in the case addressed here, connecting in these settings is far from easy.

Our research reveals a number of processes of discursive actions, taken by the project’s stakeholders, directed at finding ways to connect under the exposition of multiple institutional demands. Even though our study only focuses on the first period of the project, the procurement phase, which was divided into three main sub-phases,, it uncovers an interesting interplay between distinct institutional demands and different conversational actions taken to find creative ways to connect. The actors’ actions in the process in many ways resemble the actions typically found in a hybrid organization. The actions taken were creative in the sense that when the actors, as carriers of institutions (Scott, 2012), entered the project, the project objective became a number-one priority and they gradually found creative and intuitional ways of temporally combining the available institutional demands. We are talking about a period that lasted six months altogether, so “gradually” is being used in the sense of a temporary organization operating at a high speed. Eisenhardt and Bourgeois (1988) describe how stable patterns of political behavior develop slowly and how, once set, they are slow to change. They use a metaphor of a river to describe the process: “Like a river, politics can take an almost random early course...However with time, political behaviors become channeled into stable patterns, and like the course of a river, resistant to change” (p. 759). This is not what happened in our temporary organization. Rather than the behavior of a river, our data demonstrates the idea behind the saying “when in Rome, do as the Romans” (Orr & Scott, 2008, p. 583). In temporary organizations, the temporality of the organizational form most often encourages a more temporary view and treatment of institutional orders among its project team members. It appears that the actors were temporally “cheating” on (i.e., partially deviating from) their institutions by merging them into temporal hybrid forms (i.e., creating institutional exceptions [Orr & Scott, 2008]) that were easily resolved when new demands entered the project. Rather than a “river” or a stable “marriage,” a “swingers’ club” or a “folkdance” appears to be an appropriate metaphor for complex temporary organizations under pressure of multiple institutional demands.

The temporary organization’s actors create opportunities for a free zone (i.e., an institutional exception) where temporary “flings” with other logics and institutional demands are legitimized and sometimes even required and potentially even change the actors’ original views, just as experiences continuously rewrite history (March, 2007). Similarly, a marriage may change, and temporary flings in a “swingers’ club” might change the view of the marriage. As described by March (2007), societies and organizations tend to reward and dictate values of manliness, forcefulness, independence, and intelligence, while ignoring playfulness, foolishness, intuition, and creativity. To some extent this is what the project partners appear to be doing with their institutional demands in temporary organizations—acting playful to cope with conflicting institutional demands. Is an institutional exception so to be seen as an exception or a rule for inter-institutional temporary organizations? As stated earlier, our case is unique but with quite a substantial amount of common characteristics shared with other infrastructure projects. Our case reveals a number of occasions of hybridization of institutional demands with a temporal nature. The exceptions seem to change with the actions, events, phases, flows, and paces in the project process. Creating exceptions may so be seen as a strategic act of bridging perspectives and demands in the project process, which might be costly in the short term (as suggested by Orr and Scott, 2008), yet potentially necessary from a longer-term perspective to keep the course of the project relevant. We thus propose:

Proposition 1. Temporary inter-institutional organizations that operate under high degrees of complexity, uncertainty, and time pressure are likely to, in a rather high pace, find creative and playful ways of combining multiple institutional demands and thus develop into hybrid organizations with institutional exceptions over a rather short time period. Yet, the institutional exceptions have a fluent nature and easily resolve as the project enters new challenges. In temporary inter-institutional projects, creating institutional exceptions may therefore be seen as a rule rather than an exception.

In order to surpass the stage of only clashing with institutional demands and create a hybrid form, the teams relied on two distinct strategies: (1) identifying a common fundamental driving force in their work, which helped them to see the “good” in the contrary institutional demands rather than only focusing on the “bad” things (good and bad in relation to the project performance), or (2) identifying a common view they could accept in the different institutional orders and building from there a mentality of combining the best of two worlds (Smets & Jarzabkowski, 2013).

The first strategy was apparent, for example, when the Englishmen and the Swedes managed to develop a positive team spirit of “we can do it!” and thereafter started to find ways that their logics could best be combined to win the bid. The project participants were acting as institutional entrepreneurs to deal with the structural overlaps they were exposed to (Thornton et al., 2012)—for example, when the English and Swedish architects met and had to renegotiate their roles and functions. Put differently, the initial stage of the two institutional order clashes was characterized by institutional ignorance and a general lack of knowledge about applicable institutions in the action arena (Orr & Scott, 2008). After ongoing negotiations under time pressure, the parties improved their discursive abilities and started to make deviations (see Orr & Scott, 2008) from their orders to find an appropriate balance in the action area. Our case thereby reveals that learning how to enact and interact with the different demands requires hard and intensive work and often a number of clashes and social negotiations to trigger creation of hybrid-logics or institutional exceptions. The role of language and the parties’ continuously improving conversational abilities were fundamental for this to happen. Thus, through their interactive processes, they tested to temporarily de-couple from certain aspects of their own demands while fighting harder to cling tighter to other aspects. This resulted in a creation of a collective “hybrid” logic where the Swedish passion for design quality could be combined with the English passion for writing watertight PPP contracts, that is, they learned both how to co-exist and co-mingle and thus achieve connection by allowing for institutional exceptions (see Orr and Scott, 2008).

The second strategy was observed, for example, when both the public and private partners agreed to observe the working environmental law and agreed that patient safety was something they wanted to achieve; as a result, a culturally shared feeling of a partnership without cheating grew. They thereby coupled strongly to this common part of the logics, while abandoning other normative and cultural-cognitive aspects of their host’s institutional logics. The third phase of the project and the quick finding of the common partner logic among the closest involved parties may be explained by the fact that they both risked severe economic losses if the opposition won the upcoming election and cancelled or changed the rules of the game in the project. This, in combination with a shared experience of collective action and an ability to go back to a traditional logic concerning a dialogue between client and contractor, appeared to glue them tightly. Pre-knowledge and experience of involved institutions and actors provided an expertise in troubleshooting and resolving exceptions (Orr & Scott, 2008). The partners could therefore more easily jump into the process of accepting a contradictory institutional order (Smets & Jarzabkowski, 2013).

Our findings thereby reveal a process where logics enter and leave the process and during their presence in the very process, they are socially negotiated and to different degrees may be temporally transformed into new shapes and institutional exceptions. We therefore suggest the following proposition:

Proposition 2. Temporary inter-organizational organizations operate under pressures from multiple institutional demands that are continuously under social negotiations as stakeholders enter and leave the organization. The ability to cope with the pressure is facilitated by strong discursive abilities among the actors through achievement of shared definition of words and their meanings. Multiple institutional demands may thereby co-exist, co-mingle, clash, or assume hybrid forms in an ongoing dialectic process throughout the life of the temporary organization.

However, not all parts of the system of systems were connecting in the process; a number of disconnections and temporal misfits were visible. First, the third phase demonstrated that sometimes diverging institutional demands continue to clash over and over again. The old and new healthcare orders did not appear to get any closer; however, the politicians were also conspicuous by their absence from the project—they were not actively involved in the dialectic process. The knowledge of the other institutional demands, as well as the means to increase the knowledge and reach acceptance, appeared insufficient. Even though the partner order appears to have managed the faster pace driven by the upcoming election, abandoning the current old healthcare order required a different pace than the project could offer. The system of systems was sub-optimized and out of pace, supporting Scott and Orr’s (2008) claim that large projects come with severe friction, conflicts, and unexpected transaction costs. Our study therefore suggests that temporal misfits in projects may encourage stronger coupling to existing logic and may become a significant risk to the project’s survival.

Much research suggests that de-coupling in projects is the key to success (for example, see Sydow, Lindkvist, & DeFillippi, 2004). We take on the perspective of institutional logics and argue that this may not always be the best solution for project work. Put differently: “…purposely not changing things is not necessarily a sign of indifference, ignorance, or incompetence. On the contrary it may well be a sign of creativity, imagination, and persistence” (Hernes, in press, p. 16). We suggest the idea of that de-coupling leads to project success on the edge; in certain situations it may be wiser not to de-couple but to stay connected to your institutional demands, or at least some of them. This thus, requires knowledge of how and when and what parts to de-couple from and stay coupled to. In the process, the project participants appeared to learn to manage this over time. We therefore suggest the following proposition:

Proposition 3. Temporary inter-institutional organizations are often characterized as being systems of systems where temporal misfits occur due to diverse institutional demands. Finding the pace in the system of systems requires close interaction and openness to engage in actions resulting in total or partial temporal de-coupling from the adopted institutional demands.

Conclusions and Implications

This study adopts a qualitative case study to investigate how institutional demands are materialized in a temporary inter-institutional organization. We adopt the approach presented by Scott and colleagues (2004; 2011; 2012) to address institutions by investigating three analytical elements of institutions: cultural-cognitive, normative, and regulative. We conclude that temporary inter-institutional organizations operating under high degrees of complexity, uncertainty, and time pressure are likely to find creative ways of combining multiple institutional demands into institutional exceptions and thus socially construct hybrid organizations over time. The transformation involves a dialectic process of conflicts, negotiations, and deviations among involved actors until they find the rules and appropriate discourses and actions for that particular arena. It may require a great deal of the project members’ time and energy to find some degree of “harmony” in the project process. Generally, deviations from an institutional order have been found costly from an economic, social, and cognitive point of view (Phillips et al., 2000), and even though some kind of harmony is temporarily achieved, the harmony is very dynamic and has a tendency to easily dissolve. New actors continuously enter and leave the organization in accordance with when their knowledge and expertise are required. The involved institutional orders are continuously under social and dialectic negotiations as stakeholders enter and leave the organization; logics may thereby co-exist, co-mingle, clash, or assume hybrid forms in an ongoing process throughout the life of the temporary organization. We further suggest, in line with Scott and Orr (2008) and Dille and Söderlund (2011), that processes unfolding in inter-institutional temporary organizations are characterized by conflicts, temporal deviations, exceptions, and misfits.

In line with Orr and Scott (2008), who suggest that experience from interacting with certain institutional demands may impact the efficiency of dealing with them, we encourage longitudinal studies of individuals who are continuously “cheating” with other logics. This would be done to investigate if their original logics become obscure and less taken for granted as they accumulate experience, or if they become more rigorous and certain of their original logistics.

Our advice to practitioners is threefold and mainly relates to the importance of understanding stakeholders’ institutional demands, as well as careful negotiations between these demands for relevant customer outcomes. First, there is no guarantee that the host organization’s institutional demands will be adopted. It is more likely that the project team members will deviate from their institutional orders and create a temporary exception, as appears to be a rule rather than an exception in these complex entities. Finding institutional entrepreneurs that are open to negotiations of the institutional demands (carried by the project’s stakeholders) yet protect the most important parts of them may be critical for decreasing potential risks related to total abandonments of the institutional demands for the involved organizations. Second, if the proponents of an institutional order are not directly involved in the dialectic negotiation process, the opponent will most likely not adopt the proponents’ suggestions and thereby become a sever risk for the project and establishment of the new institutional order. Third, inter-institutional temporary organizations comprise several large and complex systems, and temporal misfits of different parts of the project may create severe consequences for the survival of the project. Understanding the pace of different entering institutional orders and the consequences of abandoning an institution’s demands will therefore be critical skills for the project manager to possess in order to manage the complex temporary system of systems.

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Sofia Pemsel, PhD, is Assistant Professor at Copenhagen Business School, Denmark. Her main research interests are knowledge and learning in projects and project-based organizations. Dr. Pemsel earned her PhD at Lund University, Sweden. During her time as a PhD student she was a visiting scholar at Queensland University of Technology, Australia, and SKEMA Business School, France. In 2012, Dr. Pemsel successfully defended her doctoral thesis. She has since been a visiting lecturer in project management at Umeå School of Business and Economics (USBE), a visiting scholar at BI Norwegian Business School, and a post-doctoral researcher at the Université du Québec à Montréal, Canada (UQAM).

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

©2014 Project Management Institute Research and Education Conference

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