1 Department of Economics and Business Economics, Aarhus BSS, Aarhus University2 Department of Management, Aarhus BSS, Aarhus University3 Department of Management, Aarhus BSS, Aarhus University
How members experience and handle attributions of organizational il-legitimacy
The financial crisis has brought il-legitimacy to the center of organizational life in the banking industry. It is unfortunate that little is known about how organizational il-legitimacy is experienced and handled by the people who spend most of their wakening hours at work within these organizations. The purpose of this paper is to address this gap of knowledge by exploring how members of a bankrupted bank experience and handle attributions of organizational il-legitimacy: to investigate the phenomenon from an inside perspective - in the eyes of the people who undergo it. The paper has an inductive approach and offers an explorative analysis based on an in-depth study of qualitative interviews with 20 members of a bankrupted bank. The analysis shows that in bankers’ narrations, (il)legitimacy is central: as a problem and as a solution. The paper contributes to extant knowledge on (il)legitimacy by showing how the phenomenon is experienced and handled by the people inside an il-legitimated organization. More precisely, it suggests a nuancing of the concept by dividing it into internal and external (il)legitimacy and considering how members internalize and externalize the construct. The paper contributes to the traditional way of conceptualizing (il)legitimacy by challenging assumptions of an integrated organizational response to a macro level objective evaluation by offering a back stage micro level glimpse of the multiple and conflicting ways individuals experience and handle il-legitimacy. Moreover, the paper contributes to extant knowledge on identity and institutional theory by showing that as members engage in identity work to re-construct their challenged perceptions of self and others, they also engage in a form of institutional work that facilitates a reproduction of a problematic institution in crisis.