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Making decisions
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5.3 Social institutions

Of course, the extent of agreement about meaning can be highly variable: from the ephemeral (a certain style of clothing may come to stand for a shared attitude among a small group of teenagers for a short period) to the more profound (such as the idea of ‘a market’ or ‘marriage’). Sociologists refer to these more profound shared meanings as institutions. In this sense, an institution is a persistently reproduced social pattern that is relatively self-sustaining. However, to say that institutions are self-sustaining is not to say they cannot change. In recent decades, to take one example, the shared understanding of the meaning and rules of the institution of marriage have changed considerably.

These shared social meanings powerfully influence and constrain the way in which we reason and decide. They provide categories within which we think. To return to the example of marriage, the socially shared categories of fidelity, housework, childcare, separation, divorce and so on provide a framework within which we think about such relationships. These shared social meanings are tacit, implicit, and taken for granted. We understand them as ‘facts’ and they quite literally shape how we see the world. Social institutions powerfully affect how we perceive the world and exercise judgement. Box 2 gives an example.

Box 2: Social influences on what we see

In an experiment conducted by Lynne Zucker (1991) participants were placed in a darkened room where a small light was shone. They were asked to judge how far the light moved while they were in the room (the light was in fact stationary). Typically, individual participants judged the light to move to some extent. In Zucker's version of the experiment participants joined another participant who they were told was ‘experienced’. The experienced participant was in fact one of the research team. When the two participants were asked for their judgement of how far the light had moved, the ‘experienced’ participant was asked first. After 30 repetitions, the ‘experienced’ participant left the room and another naïve participant joined and the process was repeated. Zucker found that the judgement of the planted ‘experienced’ participant not only affected the judgement of the first naïve participant, but also the judgement of the second, who they never met. The perception of light movement was passing through the generations.

Zucker then varied the experiment and carried out two further versions. In the first she told participants that they should consider themselves to be part of the same organisation as other participants; in the second that they were part of an organisation and that there was an official role of ‘light operator’ – the person responsible for pressing the button to start the experiment. The light operator was first the ‘experienced’ participant (a member of the research team), and then the role passed to the first naïve participant.

Zucker found the strength of transmission of perceptions was greater when participants considered themselves part of the same organisation, and even greater when the formal role of light operator was bestowed. In other words, the more the participants were encouraged to see themselves as part of a defined social structure within which others had a legitimate role, the more their perceptions were influenced by those others. This experiment is just one example of the ways in which social institutions can powerfully affect how we perceive the world and exercise judgement.

(Source: Zucker, 1991, pp.83–107)

As we consider how decisions are made in organisations, we need to understand the role of social institutions both within the organisation and in its environment. There is an important link to the psychological perspective: much of our mental capacity has evolved to understand not the physical world we inhabit, but the social world. As a social species, individual survival has depended crucially on our ability as individuals to understand and work within our social milieu. A significant proportion of our cognitive capacity is devoted to understanding and working within social rules. If we are to negotiate our social environments and to collaborate with others, our success depends on our understanding and mastery of social institutions; so too in the world of business. Economists have typically explained firm behaviour in terms of the search for economic advantage. Many sociologists (while not denying the role of economic forces) have looked to the importance to organisation survival of establishing legitimacy in terms of relevant social institutions.