Organisations gone wild - Greve et al. (2010)

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Description and Tags

The causes, processes, and consequences of organisational misconduct

8 Terms

1
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Five causes of misconduct

  1. Rational choice & agency theory

  2. Strain theory

  3. Culture

  4. Social network

  5. Accidental & normalisation


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Rational choice & agency theory

  • Against organisation: pay for performance lead managers to manipulate earnings

  • By organisation: low reputation firms have less to loose


3
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Strain theory

Misconduct arises when a gap opens between performance goals and actual achievement

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Culture

Cultures normalise misconduct by endorsing, permitting, or facilitating it

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Social network

  • Influence account: isolated cliques

  • Secrecy account: illicit networks


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Accidental misconduct

Bounded rationality combined with technical/structural complexity leads to accidents

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Normalisation

Small, repeated mistakes become institutionalised into routines

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Consequences

  • Reputation loss (highest for middel-status firms)

  • Spillover via networking

  • Categorical delegitimisation