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Glynn and Marquis: Fred’s Bank FRED’S BANK: HOW INSTITUTIONAL NORMS AND INDIVIDUAL PREFERENCES LEGITIMATE ORGANIZATIONAL NAMES Abstract We adopt a multilevel approach in our empirical study of organizational names as artifacts, incorporating both macro-level institutional factors and micro-level individual differences to offer an enriched understanding of symbols in practice. In a questionnaire survey, we examine how organizational names function as a “shorthand” cue to affect individuals’ perceptions of, and preferences for, organizational names. We find that individuals vary in their preference for institutional conformity, thus challenging whether isomorphism necessarily legitimates for all audiences. Our results reveal how individuals’ attentiveness to naming cues varies with regard to their beliefs about the value of symbolic isomorphism (that legitimates) and their preferences for creative names (that distinguish). Our findings embed artifacts in a rich blend of institutional and individual forces that help to explain why artifacts function as potent carriers of meaning and how individuals vary in their responsiveness to institutional isomorphism. 2
Glynn and Marquis: Fred’s Bank You have to have a command of the English language or you're just nowhere. I mean like… say you get out of college or whatever… you're gonna go into business, you're gonna open a bank just for an example. You've got to give it the right name. It's gotta be something big and strong like "Security First Trust and Federal Reserve." And you have to name a bank that because nobody's gonna put their money in "Fred's Bank." "Hi, I'm Fred, I have a bank. You got $1500? …ahhh, I'll put here … in my white suit." Steve Martin - Philosophy Steve Martin’s comedic stand-up (above) alerts us to how organizational names can serve as wellsprings of legitimacy. Martin’s insights resonate with the core tenet of institutional theory, i.e., that isomorphism legitimates. As institutionalists have demonstrated, organizations whose names, symbols and artifacts conform to prevailing normative practices tend to be seen as more comprehensible and thus more legitimate (Glynn & Abzug, 2002). As Martin suggests, “Security First Trust and Federal Reserve” connotes credibility, but “Fred’s Bank” arouses such suspicion that “nobody’s gonna put their money in [there].” Thus, the names by which we christen organizations serve both as touchstones for legitimacy (Glynn & Abzug, 2002) and as cues that guide individuals’ perceptions about an institution, thereby functioning like other organizational artifacts (Pratt & Rafaeli, 2001). In this chapter, we empirically investigate how institutional norms and individual differences interact to affect individuals’ perceptions of, and preferences for, organizational names. Broadly speaking, we take up the question of how symbolic isomorphism, the institutional conformity that confers legitimacy, may be affected by differences in individual preferences. We explore how individual differences in the receptivity to institutional isomorphism affect their understanding and choices of names. Our core research questions are: Do individuals have preferences about how closely 3
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FRED'S BANK: HOW INSTITUTIONAL NORMS ... - People. hbs .edu

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