Does globalization lead to convergence? The evolution of organizations' cultural repertoires in the biomedical industry.

Abstract

Can national styles of doing business co-exist with a global economy? I take an organization theory approach to this question and I treat international convergence, the demise of national differences, as a special form of institutional structuration. The central tenet of this dissertation is that economic globalization is not a sweeping external trend with inevitable outcomes. Rather, it is a situated process, animated by firms' pragmatic actions and directed by concrete social structures. I examine changes in the cultural repertoires that firms use to make sense of and act on their environments, and in the institutional context that legitimates them. Cultural repertoires are the toolkits, or cognitive resources, that firms use in strategy formulation and corporate sensemaking. I examine three forms of social structure that situate the use of particular repertoires by organizations in a field: networks of interaction among organizations, organizations' awareness of each other through categorical reference groups, and the shared experiences of different founding cohorts of firms. As these structures internationalize, organizations' repertoires are expected to converge. Organizational changes in repertoire use over time triggers changes in national institutions, but organizational changes are at the same time constrained by institutional context. I thus articulate and test the mechanisms that link organizational and institutional change in each account of convergence. Data come from the organizational field of commercial biomedicine in Germany and the USA between 1980 and 2001. I analyze text from interviews, company annual reports and national newspapers, combining qualitative semiotic analysis with multilevel growth curve models. I observe aggregate mild average convergence at the organizational but not the discursive level; however, substantial within-country variation exists in repertoire use. I find dyadic competitive rivalry and cohort replacement processes to be the main structural drivers of variation in organizational convergence. Changes in organizational repertoires are associated with subsequent changes in public discourse, while framings of crisis and attention to foreign actors in public discourse facilitate organizational convergence. Thus, the empirical results support a co-evolutionary perspective of convergence.