Institution And Organization

By describing the organization structure and behaviors of Hangjin Silk Weaving Mill, which is one of the enterprises with time-honored brand located in Hangzhou City, the research explores and demonstrates the ways, features and reasons of the influence that the institution environment has on the organization forms. According to W. Richard Scott, this research focuses on:(1) the influences that the institution environment has on the organization at the different periods;(2) the mechanism that institution environment has the impact on the organization in the process of institutionalization and institution change from three different dimensions which are regulative, normative, cultural-cognitive.Specifically, this research analyzes and explores the static and dynamic relations between the institution environment and the enterprise as organization at the period before the establishment of PRC, at the period of planned economy and at the period of market economy through the methods of document research, intensive interview and participant observation, which are based on the method of extended case and qualitative study.The empirical research on the topic and its finding are the following:At the period before the establishment of PRC, the founding of the enterprise as organization is result of the synergy which regulative, normative and cultural-cognitive brought together. The same industry tends to appear at the same region by the influence of the normative of market and technology and the culture with local features especially. Mr. Hangjin, who was born at the region of the lower reaches of the Yangtze River, where had the most advanced sericulture and silk industry in china, learned the Silk Weaving technology in the vocational school, created the special silk weaving method, which could make silk picture as good as the photograph. Under the support of relatives, he founded Hangjin Silk Weaving Mill in1922. The enterprise as organization could get the legal status because of cultural identity, technology support and convenience of local specialty. The imitation tactics in the strategy of obedience, compromise and avoiding was hired to decide the scale and pattern of the enterprise.At the period of planned economy, in which the enterprise has been totally under control of state, the normative and cultural-cognitive could play a role only under the condition of permission from regulative. The state, which had central authority, controlled the normative of market and technology, and even the individual’s cognizing the working and living. Confronting the so powerful regulative, the enterprise as organization exercised the strategy of obedience and compromise. The enterprise became large and all inclusive, which made it be a workshop of the super monopoly enterprise named "state".At the period of market economy, in which the enterprise tries the model of diversified development in accordance with the requirements of the market economy system, with the decreasing of control from the state and transformation of government’s functions, the regulative plays a much weaker role than that of at the period of planned economy, and the normative of market and cultural-cognitive play major roles in impacting on the enterprise. Because of unsoundness of market normalization, on the one hand, the enterprise depends on the traditional cultural identity and organizational identity of industry and the identity from officials to get productive resources and to enlarge the living space, on the other hand, the enterprise has to meet the challenge from market independently. As soon as the enterprise meets the requirements of state, it would try to avoid the pressure brought by the regulative and choose the strategy of diversified development.By positive and comparative analysis of the three periods, the followings can be found:(1) the institution environment, in which the level and ways of the influence that regulative, normative, cultural-cognitive have on the organization are different, surely plays an important role in changing the structure and behaviors of the organization;(2)the inertia, which may form some certain solidified structure to narrow the scope of path choice of an organization, appears in the existing institution and the organization form that the elements of institution make at any of three periods. When the change of institution environment is happening, the organization would make a choice on the base of institutional elements which are formed at the former period. This kind of institutional dependence is essentially the inertia which comes from the element of cultural-cognitive in the institution environment. The conclusion of this research is that cultural-cognitive as one of elements of institution environment is a major variable for the organization to meet the challenges of environment change, which brings the cultural tradition to the organization and plays a large part in deciding the strategy choice and behavior pattern of the organization. When the survival and development issues of the state-owned enterprises with time-honored brand are considered in the process of establishing the market economy system, it is necessary to take advantage of the functions that the culture can bring belief system to the organization and offset the unsoundness of market norms, which is based on the peculiarity of institution which comes from the culture-cognition in Chinese institution environment.