Instituitonal Theory

The concept of organization serves as a key factor in determining if an organization or company reaches its goals and objective while exemplifying their mission. Nonetheless, there are various theories of organization that can be utilized such as the institutional theory (I.T) of organization. This theory focuses on the environmental factors experienced by an organization such as “external or societal norms, rules, and requirements that an organizations must conform to, in order to receive legitimacy and support” (Shortell and Kalunzy, 2000, p.24). The institutional theory depends, heavily, on the social constructs to help define the structure and processes of an organization.
The most basic principle and distinct characteristic to the institutional theory is conformity. Conformity is the meter stick that is used to determine the legitimacy of an organization. The concept of conformity establishes “rational myths” in which it is just “rational” that an organi...