The Institutional Environment and the Dynamics of Organizational Change

The institutional environment includes the rules, norms, and expectations that shape how organizations operate, such as laws, culture, and industry standards. Organizational change refers to adjustments or transformations within a company. Together, they influence how organizations evolve; external structures can enable, constrain, or drive change, while internal factors respond to these influences. Understanding this dynamic helps explain why organizations adapt at different rates and how they successfully implement new strategies or practices amidst external pressures.