The Institutional Logic of Great Global Firms

Rosabeth Moss Kanter

Working Paper | HBS Working Paper Series | 2011

The Institutional Logic of Great Global Firms

Abstract

Theories of the firm have been dominated by a legacy of ideas from early industrialization that pose zero-sum opposition between capital and labor (or capital and nearly everything else), differentiating the economy from society and often posing irreconcilable conflicts. The search for mathematical models has turned the negotiated order of organizational activities, which necessarily include particularistic elements, into abstract generalizations that favor quantifiable variables. This paper offers another logic, a social or institutional logic, to let practice provoke the creation of new theory. It provides examples that show how social logic guides the practices of widely admired, high-performing companies, and why people and society are not an after-thought to be used or discarded, but core to the purpose and definition of the firm. It builds on in-depth, ongoing global field research on admired companies from four continents, followed in over 20 countries, to derive six propositions about the role of humanistic institutional logic.

Keywords: Economy; Capital; Globalized Firms and Management; Labor; Corporate Social Responsibility and Impact; Practice; Conflict of Interests; Social Issues; Theory;

Language: English

Format: Print

35 pages

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Citation:

Kanter, Rosabeth Moss. "The Institutional Logic of Great Global Firms." Harvard Business School Working Paper, No. 11-119, May 2011.

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