Orchestrating institutional complexity and performance management in the performing arts

• Published date: 01 August 2020
• Author: Per Ståle Knardal
• Date: 01 August 2020
• DOI: http://doi.org/10.1111/faam.12223

Received: 30 November2017 Revised: 13 August 2019 Accepted:10 September 2019

DOI: 10.1111/faam.12223

RESEARCH ARTICLE

Orchestrating institutional complexity and

performance management in the performing arts

Per Ståle Knardal

NTNU Business School, Norwegian University of

Science and Technology,Trondheim, Norway

Correspondence

PerStåle Knardal, NTNU Business School, Nor-

wegianUniversity of Science and Technology,

NO-7491Trondheim, Norway.

Email:per.s.knardal@ntnu.no

Abstract

This paper investigates the integration between institutional com-

plexityand performance management in the field of performing arts.

Prior research has documented tension related to how performance

measures and management tools are used in arts organizations, and

the conflict is often explained as being a result of the intrusion of

business-like accounting tools into the exercise of the arts. Draw-

ing on the concept of institutional logics, the findings of the current

study suggest that a diversity of logics is salient in this organizational

field. The performance measurement system is confronted with mul-

tiple logics, and the study shows how the role of performance man-

agement is shaped by this institutional complexity.

KEYWORDS

institutional complexity, institutional logics, performance manage-

ment, performance measurement, performing arts

1INTRODUCTION

In recent years, there has been increased emphasis on exploringthe presence and implications of institutional logics in

organizations (Carlsson-Wall,Kraus, & Messner, 2016; Lounsbury,2008; Rautiainen & Järvenpää, 2012; Reay & Jones,

2016). Institutional logics shape rational and legitimate behavior in institutional fields and hence influence organiza-

tional practices (Greenwood, Raynard, Kodeih, Micelotta, & Lounsbury, 2011). In addition, several institutional logics

may be present in an organization or organizational field, and these separate institutional logics can create multiple

and also competing institutional demands (Friedland & Alford, 1991). However,research has offered different conclu-

sions regarding the effect of multiple logics, or institutional complexity,from conflict between, to the coexistence and

blending of logics (Besharov & Smith, 2014; Rautiainen & Järvenpää,2012).

Performance management is viewed as an overall management of performance (Ferreira & Otley, 2009), which

includes both formal and informal mechanisms. Most accounting research has focused on specific and formal aspects

This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and repro-

duction in any medium, providedthe original work is properly cited.

c

2019 The Authors. Financial Accountability & Management published by John Wiley& Sons Ltd

300 wileyonlinelibrary.com/journal/faam FinancialAcc & Man. 2020;36:300–318.

KNARDAL 301

of performance management systems, but there have been calls to take a broader approach to include more informal

mechanisms such as cultural and ideological controls (Kraus, Kennergren, & von Unge, 2017; Malmi & Brown, 2008).

This paper examines the integration between institutional complexityand performance management in the perform-

ing arts sector,more specifically in symphony orchestras. The starting point for this paper, however,is the government

performance measurement system. Performance measurement has been an extensive management trend in recent

decades (Arnaboldi, Lapsley,& Steccolini, 2015; Ramberg, 2017; Speklé & Verbeeten, 2014), particularly in the public

sector due to the increasing popularity of new public management (Lapsley,2008).

Priorresearch has also problematized performance measurement in the arts sector, with one such challenge cited as

the difficulty in capturing the complexity of artistic activity through performance measurement (Chiaravalloti& Piber,

2011; Christiansen & Skærbæk, 1997; Nørreklit, 2011; Stockenstrand& Ander, 2014; Turbide& Laurin, 2009). As such,

accounting studies within the performing arts sector have drawn on the inherent dichotomies of art and creativity on

one hand, and management and control on the other (Chiaravalloti, 2014; Christiansen & Skærbæk, 1997; Eikhof &

Haunschild, 2007; Turbide& Laurin, 2009; Wennes, 2002; Zan, 1998).

In order to study the integration between institutional complexity and performance management, this paper aims

to account for how the design and use of the performance measurement system is influenced by institutional logics,

and how these logics are manifest in this organizational field. There are numerous examples in which the coexistence

of logics has generated negativetension or conflict (Glynn & Lounsbury, 2005; Greenwood et al., 2011; Reay & Hinings,

2009). This paper, however, prompts a rethinking of the tension-generating role of performance measures in the per-

forming arts field by providing more detailed insights into how the different logics are instantiated in performing arts

organizations, and how situational factors influence the relationship between logics.

The remainder of the paper is organized as follows. The nextsection elaborates on institutional theory and the insti-

tutional logics perspective, before presenting literatureon performance management and performance measurement.

This is followed bya description of the research method used in this study. Next, the case analysis outlines the empirical

field, before developing the main findings. The final sections are a discussion of the paper’s findings and a conclusion.

2INSTITUTIONAL LOGICS AND THEIR IMPLICATIONS

An institutional approach to organizational research proposes that there are persisting elements in social life—that

is, institutions—that affect organizations (DiMaggio & Powell, 1983; Meyer & Rowan, 1977; Tolbert& Zucker, 1983).

Neoinstitutional theory can be conceived to constitute two broad approaches: structural institutionalism and agency

institutionalism (Green Jr.& Li, 2011; Heugens & Lander, 2009). Central to structural institutionalism is the idea that

organizations need to pursue legitimacy in organizational fields where important resources are exchanged(DiMaggio

&Powell, 1983; Friedland & Alford, 1991; Kurunmaki, Lapsley, & Melia, 2003). Togain legitimacy,organizations become

increasingly isomorphic due to mimetic, coercive, and normativepressures. Agency is hence constrained because insti-

tutional myths and relationships at the field level direct organizational activity and behavior (Green Jr. & Li, 2011).

Meyer and Rowan (1977, p. 347, 349), although not providing an exact definition of legitimacy,stated that legitimacy

can result from “legal mandates” and “collectively valued purposes, means, goals, and others.” Central to Meyer and

Rowan’s (1977) proposal is the idea that legitimacy protects organizations from external pressure as the incorpora-

tion of institutionalized elements shields the organization from having its conduct questioned. Suchman (1995, p. 574)

later defined legitimacy as “a generalized perception or assumption that the actions of an entity are desirable, proper,

or appropriate within some socially constructed system.” This followed Weber’s suggestion that legitimacy can result

from compliance with both generalsocial norms and formal laws (cited in Deephouse & Suchman, 2008). Thus, an orga-

nizationthat conforms to institutionalized rules and pursues l egitimacyc ontrastswith organizations built on efficiency.

Although efficient organizations strive for alignment between structure and activities, institutionalized organizations

decouple elements of control and structure from their core activities (Meyer & Rowan, 1977; Orton & Weick, 1990).