Hybrid Organizations – What’s in a Name?

2.1 Origins of the Concept

In studies of organizations, the possible first use of the concept of hybridity was by the American journalist and foreign correspondent Marquis Childs, who studied Swedish society in the 1930s and highlighted its corporativist structure with close bonds between state and enterprise, dubbing the Swedish model a “hybrid economic structure” (Childs 1936: 70–71). In a similar vein, a 1950s study in political science described organizations that are in the border area between the public and private sectors (Dahl and Lindblom 1953). Years later, with a similar argument, Bozeman (1987) concluded that all organizations are, to an extent, public since all organizations are part of the public sphere and operate within the framework of public regulation.

By then, many studies had acknowledged organizations operating in between of societal sectors, most obviously public-private enterprises (PPPs) and similar entities that have the legal form and structure of e.g. a private company but fulfill a public service.

This state of hybridity thus means that organizations combine and balance between potentially conflicting interests such as profit and social benefit, or democratic transparency and trade secrets, and they typically also combine different governance forms such as bureaucratic rule and professional autonomy. In the words of Antonsen and Jørgensen (1997), the borders between the public and private sector have become blurred. This statement resonates with key arguments of several prominent social theorists of late, who have conceptualized current “late modern” or “post-modern” society (and similar) as a state of boundarylessness or at least increasingly permeable boundaries between previously clear institutions and entities such as the nation state, nuclear family, sectors of society, and class (Berman 1982; Wagner 1994; Bauman 2000), which we will return to later.

Empirical research on the interesting and promising manifestation of hybridity became increasingly relevant and opportune in the wake of the reforms to both private and public sectors in the 1970s and on, including deregulation, choice reforms, and the rise of what has been called the New Public Management (NPM). These changes brought a steep growth in private companies performing public services, a reorganization of public authorities to conform with private sector governance forms and ideals, including the branching off of public services into publicly owned companies, and a rise in mixed ownership and control, including not least PPPs (Johanson and Vakkuri 2018: 3–4; Koppell 2003: 3). PPPs and other similar constructs are what Alexius and Furusten (2019) call “constitutional hybrids”, which means that they are deliberately constructed to combine different purposes, logics, or ideals, such as profit and public good or other nonprofit purposes.

The identification of such constitutional hybrids usually relies on ideal-typical descriptions of three sectors of society: public, private, and nonprofit (or “third sector”) (Billis 2010). According to this scheme, which is highly intuitive, the three sectors have specific characteristics that separate them organizationally and in terms of their resource bases. The public sector is organized around political decision making and the exercise of public authority, in accordance with democratic, bureaucratic and legal rule, and with primary funding from the public purse and thus the taxpayers. The private sector, organized around the production and distribution of value in accordance with the capitalist and market logic, consists of enterprises of various types, that operate in accordance with legal frameworks generally designed to enable profit-making and the limiting of exploitation of natural and human resources. The non-profit or third sector consists of organizations that lack a profit motive but are driven by a special interest, usually with ideological or religious grounds or a specific aim to promote activities or ideals of a particular type, such as in sports or culture. The main revenue stream of the third sector is the voluntary work or donation of funds from private citizens or organizations, and the basis of their governance is both more varied and more diffuse than the private and public sectors.

By identifying the category where a particular organization belongs, knowledge about the governance and funding of the organization, and what patterns of decision making and behavior we can expect to see in it, can be conveyed (Billis 2010). A theoretical consequence of this ideal-typical categorization is that while most, if not all, organizations probably combine characteristics from two or more of the categories, most organizations probably also have a main affiliation in one of them, due for example to their ownership structures.

2.2 The Institutional Logics Perspective

Much of the above mentioned research has aligned itself with organization studies in the neoinstitutional tradition, and more specifically the arm that developed the “institutional logics” perspective and the study of coexisting and conflicting such “logics” in organizations and organizational fields. This is, most likely, the most common use of hybrid organizations as concept, and it is slightly paradoxical: Neoinstitutional theory originally emphasized homogeneity (isomorphism) in organizational fields, rather than conflicting logics (Meyer and Rowan 1977; DiMaggio and Powell 1983; see also Battilana, Besharov, and Mitzinneck 2017). A counterreaction to this homogeneity thesis, initiated by Friedland and Alford (1991) and championed especially by Thornton and Ocasio (1999], 2008]), produced a new perspective that maintained the social-constructivist view on behavioral patterns and how they contribute to conformism in organizational operations, but acknowledged that there are different logics that may come in conflict with each other, and put these at the center of the analysis.

In pioneering studies of the academic publishing industry, Thornton (2004) developed “institutional logics” as a conceptual tool to study the coexistence, contrast and conflict between different norm systems, governance principles, and goals in organizations. From there on, this use of “institutional logics” grew dramatically, in two complementary directions. One was the theoretical development of “the institutional logics perspective”, consolidated in a handbook chapter (Thornton and Ocasio 2008) and a monograph (Thornton, Ocasio, and Lounsbury 2012), that outlined a rather strict and simultaneously apparently consolidated interpretation of the theory with an “interinstitutional system” consisting of several “institutional orders” (family, religion, state, market, professions, corporation) (Thornton, Ocasio, and Lounsbury 2012: 56). The other was a more pragmatic utilization of the concept and the overall idea, developed in a myriad of empirical studies that focus on logics and how they coexist in specific settings. These include pioneering studies that point out that all organizational fields necessarily have to contain competing logics (Reay and Hinings 2009); that organizations also can actively ”cherry-pick” elements of different logics (Pache and Santos 2013); that different logics therefore can be mobilized to balance stakeholder interests (Kodeih and Greenwood 2014); and that logics therefore can be resources for individuals and organizations alike (Battillana & Dorado 2010; Smets et al. 2015; Bévort and Suddaby 2016; McPherson and Sauder 2013). The variety of logics identified in these and other studies is vast and includes bureaucratic, managerial, professional, and commercial/market logic, but also editorial, public-bureaucratic, NPM, bank, medical, community, and democratic logic (for a review, see Alvehus and Hallonsten 2022).

Soon, this line of research also began exploring the concept hybrid organizations, noting that the combination of different institutional logics within the same organizations is inevitable and thus something that organizations must cope with, but that can also give rise to several interesting phenomena (e.g. Pache and Santos 2013). Although this presents a challenge to organization studies in the tradition of neoinstitutional theory, given its emphasis on homogeneity in organizational fields, reviews have shown that the neoinstitutionalists have been able to take on this challenge with good results (Battilana, Besharov, and Mitzinneck 2017; Alvehus and Hallonsten 2022). In relation thereto, it is of particular importance not to assume, as a seeming majority of the contributions to studies of institutional logics seem to implicitly do, that logics are always in conflict with each other (see the review by Greenwood et al. 2011: 325–331). The original launch of the concept by Friedland and Alford (1991) made no such assumption, and the misunderstanding has consequently been pointed out recently (Friedland & Arjaliès 2024). There is thus much to suggest that in order for the concept of hybridity in organizations to be truly useful and workable, it must be assumed that logics can be both mutually conflicting and compatible, and thus create both tension and harmony within organizations.

2.3 Hybridity by Other Names

The above review of the emergence of the concept of hybrid organizations shows that this conceptual development has revealed the seemingly self-evident fact that all organizations are, to some extent, characterized by goal conflicts or at least the need to balance different stakeholders with (partly) different demands, and different aims that require (partly) different strategies and modes of governance. This means that it is possible to find many other examples of seminal studies of organizations that highlight similar things, under other names, that therefore describe hybrid organizations or some aspect of hybridity in organizations without using that very term.

One is within transaction cost economics, pioneered by Williamson (1975), where a key insight was formed that activities of markets come at certain costs (transaction costs) and that firms therefore seek to minimize these costs by establishing economies of scale and other structured coordination. The idea is as ancient as the field itself; going back to Coase’s classic The Nature of the Firm (Coase 1937), but it also implies that firms in their everyday operations seek to blend pure market logic with bureaucratic logic and hierarchy, seeking to partly escape the market in favor of more efficient ways to goal attainment. Williamson himself mentioned “intermediary” or “ambiguous” organizations (Williamson 1975: 109) that combine the two logics, and went on to later rebrand these as “hybrid” (Williamson 1996: 104–105).

In parallel therewith, population ecology theory was developed as a macro perspective on organizations, emphasizing the role of organizations and large groups of organizations as a primary means for society to adapt to new circumstances, since a greater plurality of organizations can absorb change and use it constructively to innovate (Hannan and Freeman 1977, 1989]). Contrary to the neoinstitutionalists (previous section), population ecology scholars thus highlighted growing dissimilarities between organizations in the same field. In order to explain this, they ventured that organizations are comparably passive recipients of logics, norm systems and other impulses from society, which also means that organizations can combine a variety of such societal interests, logics, forms, and purposes (Ruef 2000; Ruef and Patterson 2009). Especially important are the varying expectations of stakeholder groups, and how different circumstances can lead organizations to overcome complexity and disorder, or suffer from it (Hsu, Hannan, and Kocak 2009; Wry, Lounsbury, and Jennings 2014). Hybridity can then be used as an asset to adapt to, and absorb, change.

Similar notions are found in the very broad but influential school of contingency theory, launched by James Thompson in his classic work Organizations in Action (Thompson 1967), which established the open systems view on organizations. This perspective emphasizes the interaction between organization and environment, and therefore acknowledges the complexity and versatility of the contexts that organizations constantly need to handle, which includes a number of stakeholders with different demands, as well as more diffuse or abstract features of the environment that may be mutually contradictory or complementary but force organizations into balancing acts: Culture, norm systems, sociopolitical change, and so on. To manage the complexity of the external environment, organizations react by making their internal complexity match the complexity of the external environment, through internal differentiation or the development of units and functions that can absorb complexity and manage the balance act between different interests and demands.

Something similar was found in research on organization identity, where the combination of differing identities is seen to lead to permanent states of hybridity that can be either ideographic or holographic (Albert and Whetten 1985). In the former, organizations tie different identities to separate units or divisions, whereas in the latter, they instead encourage a common sharing of multiple identities by all (or most of) the organization’s members. Unsurprisingly, it was also demonstrated that hybrid organizations of both types give rise to ambivalence among individual organization members and an elevated risk for conflict, especially on long term (Pratt and Rafaeli 1997).

Judging from extant literature, the perhaps most marked identity conflicts in contemporary organizations come when professional identities meet bureaucratic, democratic or market logics and ideals. This seemingly eternal identity struggle has been an important theme in classical sociology of science (Weber 1919/1946; Merton 1942/1973). In the second half of the 20th century, many prominent contributions to organization studies and organizational sociology demonstrated the usefulness of studying consequences of the coexistence of professional logic and bureaucratic logic in organizations (e.g. Wilensky 1964; Mintzberg 1979, 1983]; Abbott 1988). The contrasts between professional, bureaucratic and market logic have later proven particularly useful for understanding latter-day knowledge-intensive organizations and the challenges of contemporary organizing (Freidson 2001; Alvehus 2021). For example, studies of health care, and of the introduction of a managerial logic inspired by the private sector, have noted that this development has transformed not only hospital organizations but also the role and identity of medical professionals into hybrid forms (McGivern et al. 2015; Nordstrand-Berg 2017; Conceição, Picoito, and Major 2022). Other studies have highlighted similar developments in other parts of the public sector (Breit, Fossestøl, and Alm Andreassen 2018).

It should be emphasized that the logics themselves, in pure form, hardly ever exist and that it is the combination of two or three of them that characterizes most, if not all, organizations today (cf. Bozeman’s claim that all organizations are public, above). This is similar to what was concluded above, in connection with transaction cost theory: An actually existing pure market logic is unrealistic, as is both a completely dominating bureaucracy and full-blown professional autonomy (Freidson 2001: 2). Logics apparently need to coexist and keep each other in check.

But logics can also coexist in relative ignorance of each other, within the same organizations. and be purposefully mobilized as a resource for their management and governance. Loose coupling has been shown to be a natural feature of organizations: Although different parts are connected and cooperative, their day-to-day operations can also be conducted in physical and organizational separation from each other, and thus follow different logics or norms (Weick 1976). This is similar to what Albert and Whetten (1985], above) describe as ideographic hybridity. By extension, parts of organizations can develop subcultures that become assets on the level of units or division, but also poses risks on the overall.

One specific form of loose coupling was demonstrated by the neoinstitutionalists, who pointed out the discrepancy between formal structure and practice in organizations: The former easily grows into a myth and a false image of rationality (Meyer and Rowan 1977). Expectations from stakeholders and broader society evolve into patterns or even recipes for proper conduct, but their implementation remain in the formal structure of organizations and only affect day-to-day operations on the margin, if at all. The result is decoupling (Bromley and Powell 2012), which can be a potential asset for balancing conflicting stakeholder demands, but also a risk and a threat to organizations. Brunsson (1982], 1989/2006) theorized this as “organized hypocrisy”, a means for managers to handle conflicting demands by simply separating talk, decisions and action. “Hypocrisy” is not nominally a meant derogatorily here; in fact, Brunsson demonstrates the potential that this strategy has to be a useful management tool. But it can of course become a liability, as in cases of “greenwashing” and similar acts of window-dressing and selective disclosure (Crilly, Hansen, and Zollo 2016; Marquis, Toffel, and Zhou 2016), or when growing gaps between public image and everyday operations lead to employee alienation (e.g. Gabriel 2008; Spicer 2018; Hallonsten 2022).

Regardless of these consequences, it is clear from over a century of organization studies that organizations constantly need to work with contemporary complexity of demands and expectations from stakeholders, and with conflicting logics and norm systems. Adding to this the many signs of an increasingly fragmented environment (see the next section), it becomes quite clear that all organizations probably, to some extent, are hybrid organizations. This acknowledgement can be let to make even more sense if the view is broadened to include also established knowledge in sociology and especially macrosociological perspectives of society.

3.1 Differentiation and Interpenetration

Ever since its founding, sociology has acknowledged that modern society is functionally differentiated, with division of labor between subsystems or sectors that have their own dynamics and operate according to their own logics (e.g. Durkheim 1893/1969; Weber 1920/1946; Parsons 1952; Luhmann 1995). Politics, the economy, science, education, family, religion, the legal system (and possibly several other similar spheres or institutions) operate in accordance with different norm systems and therefore organize resource allocation and decision-making differently. Latter-day sociology has fought hard to escape the long shadow of functionalism, which went from dominance to pariah in only a few decades in the mid-20th century, but the functionalist view of society remains useful as a fundamental view of society that builds on the identification of subsystems or institutions with distinct organizing principles (e.g. Alexander and Colomy 1990; Martin 2003; Terpe 2020). The similarities between the “institutional logics” perspective, given especially the “interinstitutional system” that is part of the central theory development within it, and functionalist differentiation theory, has also recently been pointed out, and corroborates the view further (Alvehus and Hallonsten 2022).

According to classic modernity theory, including especially functionalism and systems theory, society grows increasingly heterogeneous and differentiated, with the result that the number of different forms of rationality (in Weberian parlance) or logics (in the words of contemporary organization theory) in society grows. As Besio & Meyer (2015) highlight, this does not necessarily lead to disorder and conflict between logics, since there are also integrative tendencies. Prominent sociologists, most notably Parsons (1937/1968, 1952]) and Münch (1981], 1982]), have emphasized the role of interpenetration of different societal subsystems, spheres or logics in the development of modern society, and the integration this provides in spite of growing differentiation. Interpenetration is, namely, a process that makes spheres or systems coexist, learn from each other, and influence each other in constructive ways (Münch 1982). Interpenetration can be seen in several historical processes: The capitalist market economy and the bureaucratic and democratic state have kept each other in check and underwritten each others’ abilities of contributing to value creation and allocation in society, to the great benefit of society as a whole. But interpenetration can also be seen on other levels, for example in the coproduction of technological innovation by the spheres of science and economy, or the infusion of business practices with ethics, that gives rise to business self-regulation and widening of the ethical liabilities of business, including Corporate Social Responsibility (CSR).

Interpenetration can thus be used as a conceptual tool to understand how logics meet and combine in organizations (Alvehus and Hallonsten 2022), and therefore also be a tool in the analysis of hybrid organizations, highlighting how they combine and recombine different logics. This way, formal organizations can mediate heterogeneous logics and thus create and maintain “fragmented and temporary orders”, which make them “not only well equipped to deal with different logics but also able to make them productive for their own goals” (Besio & Meyer 2015: 237).

Moreover, interpenetration gives a clue not only to why all organizations are to some extent hybrid, but also why: it is in organizations that many of society’s norm systems and principles for decision making and resource allocation meet and join forces for a variety of purposes, large and small. In relation to population ecology theory (Hannan and Freeman 1977, 1989]; previous section), it can then also be concluded that the inevitable mix of logics or norm systems within organizations can be viewed as a mechanism for adaptation on societal level, where organizations play an important part. Within public authorities, for example, during the 20th century ancient bureaucratic logic interpenetrated with a variety of demands from social movements – for equality, liberty, democracy, civil rights – and thus accommodated a necessary renewal of the role of the state and public authority that secured its legitimacy on long term and preserved overall social harmony. Within organizations, hybridity between the logics of e.g. bureaucracy and social justice was a means to accomplish this in practice.

This is close to what Luhmann conceptualized as “re-specification” – a process by which organizations transform societal logics into more specific and workable forms (Luhmann 2002: 139ff, also Luhmann 1994: 300ff), thus both making sense of them in service of various stakeholders (organization members, but also clients, customers, and so on) and making use of them for specific purposes. This means, for example, that a private company makes use of the logic of the market economy and the logic of business law/regulation for its purposes, and gives both of them specific meaning for its employees, owners, customers and business partners. As Besio & Meyer (2015]: 243) note, organizations can therefore “re-specify multiple logics through their decision-making processes”, by connecting them, translating them, and allowing them to operate separately. Hybridity between different logics thereby becomes a resource for organizations, both in terms of their direct use in internal decision-making and in terms of legitimacy, as it allows them to contribute to the reduction of social complexity.

3.2 Blurring of Boundaries

Prominent social theorists and historians have shown that the continuous process of rationalization of different spheres, subsystems or institutions under modernity, that hence made society increasingly functionally differentiated, reached a peak in the mid-20th century. In this era of “organized modernity” (Wagner 1994) or “industrial modernity” (Reckwitz 2020), that coincided with the historical period of “the short 20th century” (Hobsbawm 1994), categories and boundaries were particularly firm: Industrial capitalism, the bureaucratic and democratic welfare state, and the nation state, among other reliable institutions, were most wholesomely developed.

Such a set of functionally differentiated institutions with purified logics and norm systems seem, hence, to be tied to a very particular stage in the development of modern society, which implies that during premodern and early modern times, nothing other than “hybrid organizations” existed, that is to say, all corporations were family businesses, all states were autocratic, and most if not all other organizations were tied to either the church or the family/clan. The apparent growth of hybrid organizations today should, however, not be simply identified as a return to the normal, but be put in proper historical and sociological perspective and analyzed with the help of what the continued development of modernity theory has to offer.

A key insight in such works is that modernity is far from a fixed or stable state: Quite the opposite, it is in a state of constant change (Giddens 1990). In the most recent half century, modern society has therefore experienced a number of changes to economic, (geo)political, and cultural patterns that various theorists have conceptualized as the emergence of a new modernity, much more loose in its institutional buildup, or in the famous words of Bauman (2000), liquid modernity. Boundaries between social spheres are blurred, and hybrid forms become more prevalent. The increasing permeability of boundaries – between societal sectors, classes, nation states, cultures, and all kinds of categories including the private and the public, production and consumption, work and leisure, and so on (Harvey 1990; Wagner 1994; Bauman 2000; Reckwitz 2020) – contribute to the hybridization of organizations. Not only boundaries between sectors are blurred (Antonsen and Jørgensen 1997), but also previously solid demarcation lines are dissolved or at least weakened, through globalization, digitalization, juridification, neoliberalism, third way politics, the rise of the post-industrial or post-capitalist economy, and social acceleration.

Organization studies has been well prepared to account for the consequences of these changes at least since the publication of the seminal work of Thompson (1967), already mentioned above, but also by several other tools. Together, they make organization studies well equipped to analyze how the blurring of boundaries affects organizations.

One common theme in such research in the past decades has been the analysis of the reforms of public sectors in Western countries, that have retrospectively been named the New Public Management (NPM) (Hood 1995; Lapsley 2008). It originated in broad public discontent with efficiencies of public sector bureaucracies and new developments within the field of political economy, that highlighted the efficiencies of market-based rule and resource allocation. An ambition to renew and improve public welfare services by making them more enterprise-like led to the import of models for steering and resource-allocation from the private sector into the public sector, including performance management, competition, deregulation, and in some cases straight-out privatization. Specific results of course differed between countries, with Scandinavia, Great Britain, New Zealand and Australia usually named as the most thoroughly reformed (e.g. Barzelay 2001), but the overall trend was similar across the Western world: The boundaries and distinct characteristics of the public and private sectors thereby became blurred and even dissolved, as public service organizations adopted company-like steering mechanisms and whole administrative units (such as counties or municipalities) reorganized their operations with cost- and profit centers, internal performance management procedures, and competition. This means that the so called NPM reforms created organizations that are publicly owned but characterized by logics of private enterprise, but also that private companies that have adopted characteristics of the public sector have become more common, including private welfare providers that are profitable but fulfill a public service and are funded by the public purse. The developments made the concept of hybrid organizations relevant to use in studies of the reforms, as shown in some influential publications (e.g. Nutt and Backoff 1993; Land and Rainey 1992; Koppell 2003), but these studies also naturally focused on organizations in the borderlands between public and private.

Other historical developments in the same period led to the creation of e.g. social enterprises, that are private sector organizations that have a third sector purpose (Battillana & Lee 2014), and third sector organizations that become profitable and begin operating almost completely according to a business logic, such as sports clubs that were once entirely non-profit but have become billion-dollar industries and “icons of global capitalism” (Ginesta et al. 2020: 209). Organizations in the third sector have been around for as long as there has been organized human collaboration, among other things organizing welfare services before (and in parallel with) the buildup of public welfare systems, and fulfilled purposes that to some extent have made them hybrid, yet without the label (Alexius and Furusten 2019). Their role has, however, recently changed: On the one hand, deregulation and choice reforms have made both private sector and non-profit sector organizations more important (Blix and Jordahl 2021; Billis 2010). On the other hand, civil society has been diminished and many voluntary organizations either professionalized or abolished (Skocpol 2003; Eikenberry and Kluver 2004; Mair 2013). Macro-level processes of social change that can be describes as “economization” and “juridification” have bolstered these transformations: Studies have indicated a clear shift in the relationship between state, economy and broader society from the 1970s and on, whereby the market economy has become a model for organizing across society and its institutions, and all kinds of models of thought from economics and management have entered into politics, governance, and public consciousness (e.g. Sandel 2012; Klikauer 2013; Berman 2022). Meanwhile, other studies have indicated a similar growth of the importance of legal frameworks and legal process in the organizing of society, across the private, public and non-profit sectors, and affecting how institutions are governed (e.g. Teubner 1998; Aasen et al. 2014).

It would seem as the historical developments outlined above have made hybridity of organizations more important as a societal phenomenon and as a topic of study. Although it is still reasonable to claim that all organizations are hybrid organizations, the sociological view presented in this section also demonstrates that hybridity itself has both changed and become more important as a result of several important social change processes. In the following, some consequences of this development for organization studies, and how attention to hybridity as a concept can add a conceptual tool to the field, will be explored.

4.1 Bringing Sociology in

Functionalist sociology demonstrated that the basic understanding of society as composed of several differentiated and interpenetrating spheres or subsystems is a useful heuristic or conceptual toolbox for macrosociological analysis. Others, including the neoinstitutionalists that promoted the institutional logics perspective, have established a similar view, yet on other levels of analysis. Continued development in social theory, analyzing and conceptualizing the blurring of boundaries, has given several additional clues that are matched by empirical and conceptual work in organization studies, some of which have explicitly identified hybrid organizations as a relevant category and concept.

First of all, hybridity as a concept enables a connection of the balancing of different demands and goals in organizations, well-known in organization studies, with the sociological identification of sectors of society and ultimately also the fundamental view of society as composed of several differentiated and complementary spheres or orders, which is a foundation of social theory and the sociological understanding of modernity. Organizations can accommodate pluralities of logics in a variety of ways. A recent study of how organizations respond to institutional complexity, building on a comprehensive literature review and a critical discussion of how logics act out in practical situations, delineates four main aspects of hybridity in order to close in on the issue of why and how different organizations are differently affected by “pressures arising from institutional complexity”: Field position; structure; ownership/governance; and identity (Greenwood et al. 2011: 339–348). Field position (e.g. center/periphery) impacts the degree to which organizations are affected by institutional pressure, and their range of possible responses, because degrees of isomorphism depend partly on it. Similarly, organization structure – the location of power, the shaping of reporting relationships, and the degree of differentiation – also enables and disables organizations in their responses to institutional complexity. Ownership and governance are clearly key to how hybridity acts out. Constitutional hybrids are, for example, conspicuous in their combination of governance systems by design. They may be publicly owned companies that are created to fulfill a public service but that take the form and legal status of private corporation (Alexius and Furusten 2019), or so called social enterprises, meaning private companies that take on a purpose or mission otherwise found in the public or non-profit sectors (Defourny and Nyssens 2017). The specific characteristics of the hybridity thereby created by design depend on the purpose, ownership, legal provisions, and funding. Identity, finally, is a way to bring organization culture into the mix and acknowledging that patterns of behavior that go beyond the visible and formally established quite obviously impact the way in which organizations handle complex demands and expectations.

A particular way of studying links between organizations and the societal context within which they operate, is through (social) legitimacy. All organizations must, for their long-term survival, comply with rules and regulations and otherwise in a general sense fulfill expectations of different stakeholders (Bovens 2005). Put differently, organizations need to have reliable and trustworthy mechanisms for accountability, and such mechanisms are quite evidently different in different sectors. Hybrid organizations can be understood as characterized by multiple systems for accountability (Grossi and Thomasson 2015); publicly owned companies are, for example, ultimately controlled through democratic processes, but in practice run as corporations, with elaborate financial management procedures and auditing. Similarly, many non-profit organizations may adopt elaborate management procedures that make accountability a matter of living up to profit targets or similar, like sports clubs that operate as international businesses. Hybridity can therefore lead to confusion over what procedures are to be followed, or how these are to be implemented. In the case of publicly owned companies, these may end up as “unwieldy and unpredictable” policy instruments (Koppell 2003: 164). If demands and expectations come from several parallel logics, one of them may take precedence and carry with it the risk of mission drift, namely that the overall purpose of the organization is displaced (Thomasson, Wigren-Kristoferson, and Scheller 2021).

Similar confusion or drift due to hybridity can show up on the level of professionals or units with hybrid organizations, for example as a result of the mixing of professional logic, bureaucratic or managerial/hierarchical control, and democratic accountability. In the health care sector, for example, medical doctors supposedly serve the interest of the patient (to give the best possible care) and the interest of the taxpayer (efficient use of public funding) but has also, in recent decades, been increasingly subjected to managerial logic, through the implementation of NPM (see a previous section), which includes line management and hence the pressure to serve also whatever interests are vested in hierarchical authority. Ethical dilemmas may thus show up in the individual physician’s balancing of the different interests, as a consequence of hybridity, and similar situations are likely to occur in the professional lives of social workers, teachers, policemen, and any other profession where client work is conducted within the framework of a limited budget, and where line management has become a competitor of professional self-control due to governance reforms in the recent decades.

While the balancing of interests, logics and norm systems to some extent is part of all governance (Alvehus 2021: 116), organizations can of course respond to the challenges of hybridity in different ways. They can let one logic decline or degrade, for example when the professional autonomy that previously was strong in many organizations is pushed back by reforms of the past decades (including, but not limited to, NPM) that pit professional logic against bureaucratic and market logic, with professional logic on the losing side. The argument goes back to Weberian and Habermasian theories of the expansive nature of instrumental rationality (Weber 1922/2019; Habermas 1984), and means that professional autonomy is diminished in favor of exogenous control and accountability through bureaucratic governance and market mechanisms. The thesis is not new (see e.g. Oppenheimer 1972) but has been pushed with greater intensity in recent studies (e.g. Sennett 2008; Ginsberg 2011; Alvesson and Spicer 2016; Castillo 2023).

But both bureaucracy and market logic can also increase efficiency, transparency, and accountability. Harmony between e.g. bureaucracy and professional logic is a viable option, at least in principle, and their combination can bring “the best of two worlds” to organizations (Mintzberg 1983: 205). Harmony between different logics can also arise if individuals and groups are let to find their own means of combining logics and broadening their identities without compromising them (cf. interpenetration and re-specification in a previous section) (Kodeih and Greenwood 2014; Kirkpatrick and Noordegraaf 2015), or in a situation of continuous negotiation between mutually conflicting logics (Alvehus 2021: 96). Loose coupling (Weick 1976; previous section) can be combined with selective coupling, i.e. that organizations choose where to focus attention and which logics to give precedence (Pache and Santos 2013; Smets and Jarzabkowski 2013; Greenwood et al. 2011). This is possible because the conflict between different logics is neither inherent nor inevitable, but reveals itself in everyday situations, which means that local circumstances and the characteristics of specific empirical contexts need to be taken into account when studying hybridity (Alvehus 2021: 104–105).

But beneath the surface, harmony can of course hide resentment and discord. Today, it would seem as if the constant drive for organizations to establish and maintain social legitimacy by catering to all kinds of expectations and demands of sustainability, equal treatment, inclusion, and so on, leads to the development of communicative practices that follow standardized patterns of transparency and accountability but are alien to the core operations of organizations (Bromley and Powell 2012; Dahler Larsen 2012). The resulting decoupling of large parts of management and administrative functions from the operating core of organizations mean that “people in the same organizations begin to live in different worlds” (Spicer 2018: 41). If “organized hypocrisy” (Brunsson 1989/2006) is practiced in relation to organization members, the gap between managerial and professional logic might grow to unsustainable width (Hallonsten 2022). As an expression of conflict between logics – managerial or administrative versus professional or craft – this disharmonious situation risks becoming a downward spiral where employees lose trust in management and revert to cynical compliance (Gabriel 2008: 320–321; Fleming and Spicer 2003: 169), a development that is unsustainable on long term but not always openly visible. Studies of hybridity in organizations is a good starting point for its systematic revelation.

4.2 Understanding Renewal and Adaptation

If hybridity in organizations is understood through the lens of population ecology theory (see a previous section), it can also be conceptualized as an asset that allows organizations to adapt to change by letting different logics vary in significance and mobilizing resources within these logics to meet new demands and cultivate new opportunities.

Historical institutionalism is underestimated as conceptual toolbox for organizational sociology, and can add a much-needed historical perspective to institutional analysis. It was originally developed within political science (Evans, Rueschemeyer, and Skocpol 1985; Steinmo, Thelen, and Longstreth 1992), and has mostly been used to study how policy areas form and transform. The basic assumption is that, contrary to what classic institutional theory stipulates, changes to the equilibrium of institutional stability is neither always exogenous nor always dramatic, but instead usually gradual, cumulative, incremental and occurring on micro-level, within the framework of macro-level stability (Mahoney and Thelen 2010). A variety of processes have been identified: layering, meaning the addition of new structures to existing ones (Schickler 2001); conversion, meaning the long-term transformation of existing structures (Thelen 2004), and drift, meaning a similarly longer-term change under the guise of stability (Hacker 2004).

These processes can be used to analyze hybridity in organizations over time. Layering describes how new logics are added to existing ones, for example when the NPM reforms added new structures to existing organizations, and later, when so called “post-NPM” reforms mainly seem to have accomplished a similar layering (see e.g. Funck and Karlsson 2024). On longer term, should the internal dynamics of organizations change so that the new structures take over and old ones wither, the result may indeed be conversion or drift. The time dimension thus added can be used to establish causal chains and historical explanations for passing states of hybridity.

Organizations need to adapt to changes in their environments, but their abilities to do so are not always evident. The adding of new structures in anticipation of coming changes may be a powerful way of long-term adaptation, as shown in studies of large governmental research centers in the United States and Europe, and the changing priorities of governmental investments in R&D over the second half of the 20th century (Hallonsten and Heinze 2012, 2013]). Understood through the lens of hybridity, such studies of adaptation can give clues to the evolution of organization-society interfaces on long time scales.

On somewhat shorter timescales, immediate responses to changes in the environment may be understood with the help of organizational identity theory and the emergence of ideographic hybridity, meaning the creation of new units or divisions to absorb environmental change (Albert and Whetten 1985). This is a form of decoupling, that may lead to conflicts within organizations, but also coexistence and complementarity.

Organizational change is complicated (Sveningsson and Sörgärde 2024) but can be better understood with an institutional view and the conceptual tools offered by acknowledging hybridity and what it means. There is much to suggest that the realization that all organizations are hybrid organizations, but that some are more hybrid than others, gives important clues to why some organizations fare better than others in inevitable processes of change.