ORIGINAL RESEARCH ARTICLE
Toward a Discursive Approach to the Hybridization of Practice: Insights from the Case of Servitization in France
Olivier Cristofini*
Sorbonne Business School, Université Paris 1 Panthéon Sorbonne, Paris, France
Citation: M@n@gement 2021: 24(2): 23–47 - http://dx.doi.org/10.37725/mgmt.v24i2.7796.
Handling Editor: Thibaut Daudigeos
Copyright: © 2021 Cristofini. This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), permitting all non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.
Published by AIMS, with the support of the Institute for Humanities and Social Sciences (INSHS).
Received: 7 July 2018; Accepted: 22 June 2020; Published: 1 June 2021
*Correspondence to: Olivier Cristofini, Email: ocristofini@gmail.com
Abstract
Hybrid practices incorporate conflicting institutional logics and are recognized for their capacity to cope with societal problems. Previous literature has concentrated on the hybridization mechanisms inherent in organizations. This focus on an entity has diverted attention away from equivalent mechanisms that operate in wider social systems – specifically, in organizational fields. In this article, I show how discourses can enable such mechanisms. To that end, descending hierarchical classifications were performed on media outlets to study the discourse on the emergence of servitization in France. The results reveal two original mechanisms enabled by discourses and supporting the hybridization of the practice under study: (1) practice renaming and (2) the pivotal role played by the institutional logic of environmental protection. Based on these results, I propose a model detailing how institutional logics and discourses interact to bring about a hybrid practice. This model offers original insights to develop knowledge on hybrid organizing and promote practices that realign business goals with those associated with social welfare and preservation of the natural environment.
Keywords: Discourse; Descending hierarchical classification; Theorization; Hybrid organizing; Hybrid organizations
Over the past decade, research in hybrid organizations has developed a growing interest in institutional theory (Battilana & Lee, 2014; Pache & Santos, 2010; Smith & Besharov, 2019). Hybrid organizations are appealing because of their capacity to uphold several institutional logics, which are culturally derived principles that prescribe organizational behavior in bounded areas of social action (Friedland & Alford, 1991; Thornton et al., 2012). Specifically, many of these organizations can incorporate both non-profit and for-profit institutional logics into their practices, which allows them to tackle major societal issues: commercial microfinance organizations addressing poverty (e.g., Battilana & Dorado, 2010), enterprises with a core social mission sustained by business means (e.g., Tracey et al., 2011), and firms producing food while coping with environmental degradation resulting from human activity (Boyd et al., 2017).
Research has provided important insights into how hybrid organizations can integrate elements from conflicting institutional logics into their own practices. However, it has tended to take an ‘entity’ focus that implicitly posits hybridization mechanisms as attributes inherent in organizations (Battilana et al., 2017). Although useful, this focus has shifted attention away from the hybridization mechanisms that might intervene in wider social systems (i.e., across rather than inside organizations), especially in organizational fields (Hoffman, 1999): social spaces in which the different populations of organizations interact with each other and adopt collective practices to address common issues. This lack of attention is surprising given that organizational fields have properties that lie at the very heart of institutional theory (DiMaggio & Powell, 1983) and may help the hybridization of practices while spreading them further.
In this article, I argue that some of the organization field mechanisms enabling the hybridization of practice pertain to discourses. Discourses are meaningful bodies of texts that underpin social action (Phillips et al., 2004). In particular, they actively support the theorization of practice across organizational fields (Weber et al., 2013). Theorization involves the abstraction and codification of localized practices to make their outcomes intelligible and acceptable to a wider milieu (Strang & Meyer, 1993). In particular, it ascribes a shared social meaning to childrearing practices, thereby spreading them to other fields’ populations of organizations (Greenwood et al., 2002).
This article aims to examine the discursive aspects of the theorization of a hybrid practice. In so doing, it considers practices as ‘patterns of activities that are given thematic coherence by shared meanings and understandings’ (Smets et al., 2012, p. 879). Such shared meanings and understandings stem from institutional logics and are enacted through theorization activities, some of which are underpinned by discourses. As a result, this study is motivated by the following research question: how can discourses contribute to shaping the theorization of a hybrid practice in an organizational field?
To answer this research question, I conducted an in-depth analysis of the discourse on servitization in France. Servitization is ‘the innovation of an organization’s capabilities and processes to better create mutual value through a shift from selling products to selling Products-Service Systems’ (Baines et al., 2009, p. 555). In France, discourses accounted for multiple institutional logics and populations of organizations involved in the theorization of servitization as a hybrid practice. Specifically, these discourses showed that while this innovation emerged in a business context, it was eventually also endorsed for environmental protection and social welfare matters. Since it has become a hybrid practice shared by heterogeneous actors, the case of servitization is well suited to this research.
I performed an analysis by means of descending hierarchical classifications based on 610 press articles, which I used as a proxy for discourse and triangulated with archival data (Daudigeos et al., 2013; Wooten & Hoffman, 2016). The results revealed that (1) the renaming of ‘servitization’ as ‘functional economy’ supported the incremental reframing of the practice according to additional institutional logics, and (2) discourses introduced the pivotal role played by the environmental protection logic to integrate the heterogeneous components of the theorization of servitization, which resulted in its hybridization. Hence, the discourse actively supported the hybridization of servitization and, thus, brought together actors with initially conflicting identities, interests, and goals to coordinate and push for the adoption of the practice.
Based on these findings, I present a model describing how institutional logics, discourse, and theorization interact with each other to spawn a hybrid practice within an organizational field. This model is built on two mechanisms empowered by discourses: the renaming of the practice and the pivotal role of an institutional logic. This research makes three major contributions to theory. First, it brings to the fore the hybridization mechanisms that intervene at the organizational field level, in addition to those already revealed by the literature on hybrid organizing. Second, it presents the specific properties of words and vocabulary supporting the hybridization of practice, whether at the organizational or the organizational field level. Third, it identifies and characterizes the role of a pivotal institutional logic enabled by discourses in the hybridization of practice. These contributions are valuable in easing the tensions encountered by organizations engaged in hybrid practices. They also lead to hybrid practices incorporating more than two institutional logics and, in so doing, offer a way to reconcile business goals with environmental protection and social welfare goals. This work also has managerial implications in that it uncovers the meaning of servitization in France. Furthermore, it suggests that the transition to more sustainable organizational practices involves the reframing of existing practices rather than the invention of new practices.
This article is structured as follows: first, the literature review delineates the research gap and constructs the conceptual apparatus to conduct the analysis; second, the discourse on servitization in France, as well as the collected data and its processing, is presented; third, the results are expounded and show the role of discourses in the theorization of servitization as a hybrid practice; and fourth, the model used to abstract these results is detailed, and its contributions to future research are discussed.
Theoretical background
This section first describes the interplay of institutional logics with theorization activities, which enables new practices to acquire legitimacy and, thereby, to be spread further. Second, it highlights some outcomes resulting from conflicts between institutional logics, including underexplored aspects of hybrid organizing. Third, it lays out how the discursive approach has proved to be worthwhile in institutional research.
Institutional logics and the emergence of new practices
Institutional logics are culturally derived ‘assumptions, values, beliefs and rules’ that prescribe organizing principles (Friedland, 2017; Friedland & Alford, 1991; Thornton & Ocasio, 1999, p. 804). They operate in both symbolic and material ways. Symbolically, they prompt the interests, goals, attention, and rationality of actors so that the latter treat stimuli in a specific way. Materially, they shape structures and practices to meet social expectations (Thornton et al., 2012). Hence, institutional logics link culture, cognition, and action to each other. They are situated in the collective memory as cultural resources and are enacted to provide meaning to socially lived realities (Ocasio et al., 2016; Thornton et al., 2012).
Institutional logics exert influence throughout organizational fields, which are socially delimited areas in which heterogeneous actors become aware of each other as they interact over common concerns (Wooten & Hoffman, 2016). Organizational fields form around issues that emerge after an event has disturbed a prevailing social order and has delegitimized associated practices (Hoffman, 1999). In this context, institutional logics provide collective frameworks for reasoning, as well as criteria for legitimacy, which actors use to establish new practices and roles (Friedland & Alford, 1991; Lounsbury, 2002; Rao et al., 2003). Thus, they yield collective representations that fundamentally shape the dynamics of institutional change (Daudigeos et al., 2015).
Theorization is at the core of the change process that replaces previously dominant practices with new ones across an organizational field (Greenwood et al., 2002). It involves both framing problems and justifying innovations. Problem framing focuses on organizational failure and the necessity for change; justification means abstracting general principles from singular practices to make their outcomes intelligible to a wider milieu (Strang & Meyer, 1993). Through theorization, practices relate to established social values and demonstrate their technical superiority. In the process, they gain a force of meaning likely to garner social support and stabilize previously unseen roles, thereby becoming candidates for wider diffusion (Greenwood et al., 2002; Strang & Meyer, 1993).
From conflicting institutional logics to hybrid organizing
Conflicts between institutional logics can originate in both the ends and the means that they prescribe (Pache & Santos, 2010). Early research regarded conflicts as the way to transition from one logic to another: at the end of a period of struggle, a new hegemonic institutional logic arises and replaces the previous one. In turn, this shift gives rise to new practices prompted by ‘mono-logic’ (e.g., Lounsbury, 2002; Thornton & Ocasio, 1999). At most, this conflicting view acknowledges that two logics might operate separately within different parts of the same field (e.g., Greenwood et al., 2010; Marquis & Lounsbury, 2007) or alternately occupy a given field along temporal cycles (Dunn & Jones, 2010; Thornton et al., 2005). It posits organizations as being prompted by a single institutional logic.
Since then, research has shown how several institutional logics simultaneously affect organizational behavior. Notably, Kraatz and Block (2008, p. 243) elaborate on the concept of institutional pluralism related to the organizations that are ‘subject to multiple regulatory regimes, embedded within multiple normative orders, and/or constituted by more than one cultural logic.’ Moreover, through their similar concept of a constellation of logics, Goodrick and Reay (2011) observe how different institutional logics competed and/or cooperated to yield variations in U.S. pharmaceutical practices between 1852 and 2011. As a whole, these developments have led institutional researchers to renew their usual approach by refocusing on how organizations can face multiple and often conflicting institutional logics (Greenwood et al., 2011).
Research on hybrid organizing has taken this new approach further. It investigates how conflicts between institutional logics can not only be overcome but also be leveraged to address major societal challenges such as social development or environmental sustainability. In this vein, Battilana and Dorado (2010) demonstrate how appropriate hiring and socialization policies enabled microfinance organizations to integrate elements from competing banking and development logics. Pache and Santos (2013) show how social enterprises simultaneously endorsed conflicting social welfare and commercial logics through selective coupling. While conflict between social and commercial priorities is central to hybrid organizations (Tracey & Phillips, 2007), the human degradation of the natural environment has also been increasingly addressed, albeit sometimes indirectly (Haigh & Hoffman, 2014; Jay, 2013; Lee & Lounsbury, 2015; York et al., 2016a, 2016b).
Hybridization goes further than just enabling dimensions of multiple institutional logics to coexist within organizational structures and practices. It ‘differs from blending in that the goals of incompatible logics are integrated as complementary’ and requires these goals to be ‘constructed as simultaneously achievable, without granting dominance to one logic over another’ (York et al. 2016a). To date, researchers working on hybridization have mainly adopted an intra-organizational focus within structures (Battilana & Dorado, 2010; Lallemand-Stempak, 2017; Pache & Santos, 2010, 2013; Tracey et al., 2011), practices (Goodrick & Reay, 2011; Smets et al., 2012), both at once (Dalpiaz et al., 2016), or even at the level of individuals (Svenningsen-Berthélem et al., 2018).
Meanwhile, work on hybridization carried out at the level of the organizational field has received little attention. At most, some studies have taken a first step in this direction by indicating the active role of direct external stakeholders in sustaining hybrid practices within an organization (e.g., Smith & Besharov, 2019). Also, although York et al. (2016a) was situated at the organizational field level, it dealt with the hybridization of institutional logics rather than that of practice.
This gap is surprising because some mechanisms inherent in organizational fields may support the hybridization of practice. Specifically, theorization can stabilize a new hybrid practice and provide it with an agreed-upon social meaning across an organizational field. This archetypical practice directly emerging in the field could, in turn, help remove some of the obstacles to hybridization within organizations (e.g., Pache & Santos, 2010). Also, by occurring at the organizational field level, the theorization of hybrid practices might be a promising way to reconcile business goals with ecological and social goals (Battilana et al., 2012). In this way, hybrid practices could incorporate more than two institutional logics. Institutional theory suggests that discourses represent one way of performing part of this theorization.
The role of discourses and language in institutional dynamics
The power of discourses in ordering social reality has been thoroughly acknowledged in the institutional literature. Researchers hold discourses to be structured sets of meaningful texts that are produced, disseminated, and interpreted to underpin social action (Phillips et al., 2004). As they ‘systematically form the object of which they speak’ (Foucault, 1979, p. 49), discourses ‘create the ideas, the categories, relationships and theories through which actors understand the world and relate to one another’ (Maguire & Hardy, 2006, p. 9).
Discourses provide social actors with resources creating new opportunities of thinking and acting that are likely to provoke institutional change. For example, Lawrence and Phillips (2004) demonstrate how a ‘macro-cultural’ discourse has spawned commercial whale watching fields in Canada. Maguire and Hardy (2006) and Hardy and Maguire (2010) show how discourses have influenced the rise and fall of new global institutions and associated practices in the chemistry realm. Specifically, practices and discourses affect each other. The former feed the latter, and the latter provide sustainable meaning to the former, thus helping to trigger institutional dynamics (Green & Li, 2011; Phillips et al., 2004). Many empirical studies focus on how the interplay between institutional logics, discourses, and theorization results in the emergence of new long-lasting practices (Jones et al., 2012; Maguire et al., 2004; Nigam & Ocasio, 2010; Rao et al., 2003).
Importantly, discourses are also conveyors of vocabularies, which are ‘structured systems of words developed within social systems’ (Loewenstein & Ocasio, 2005, p. 4). Vocabularies open access to symbols and ideologies and enable individual and collective mental representations (Green & Li, 2011; McConnell-Ginet, 2008). They help to make inferences, direct attention, and directly shape the legitimacy of action (Burke, 1935; Green & Li, 2011). As such, they ‘prompt people to utilize and access concepts that they would otherwise be extremely unlikely to form’ (Loewenstein & Ocasio, 2005, p. 26) and ultimately become ‘products of social groups collectively communicating their understanding of organizing practices’ (Loewenstein et al., 2012, p. 55). Thus, vocabularies function as receptacles, vehicles, and generators of meaning all at once. They have been subjected to a significant amount of research in institutional logics because they are actors’ primary means of constructing a common understanding of the social world (Green & Li, 2011; Loewenstein et al., 2012).
This literature review shows that, first, previous research has concentrated on the hybridization mechanisms of practice that are inherent in organizations; second, potentially equivalent organizational field mechanisms are worth exploring; and third, some of these mechanisms pertain to the discursive aspects of theorization. Hence, this research explores how multiple institutional logics can give rise to a hybrid practice in an organizational field through discourses and theorization. The question of this empirical research is: how can discourses shape the theorization of a hybrid practice in an organizational field? To answer this question, I analyzed the discourses taking place in France in the organizational field, where servitization has emerged as a hybrid practice.
Methods
This section begins by presenting the discourse on servitization in France as a suitable case for investigating the research question. Over the course of three subsections, it lays out the data and the data processing.
Research setting
To answer the research question, I explored the discourse in France surrounding the practices of servitization, also referred to as the functional economy. Servitization falls within the global trend of developed economies transitioning toward service, which has been observed since the 1960s (Fuchs, 1968). Originally captured by Vandermerwe and Rada (1988), this phenomenon designates ‘the innovation of an organisation’s capabilities and processes to better create mutual value through a shift from selling products to selling PSS [product-service systems]’ (Baines et al., 2009, p. 555).
Michelin and Xerox are prototypical examples of servitization. Michelin manufactures but does not sell tires to heavy goods vehicle (HGV) companies. It charges for the use of their tires rather than the tires themselves. HGV companies are offered pneumatic solutions based on the number of tons they carry and/or the number of kilometers they travel. Similarly, Xerox manufactures but does not sell its photocopy equipment. Instead, customers sign up with pay-per-copy contracts when the equipment, which still belongs to Xerox, is made available at their workplace.
In Western countries, many manufacturers have turned into servitized firms (Neely, 2009). According to Crozet and Milet (2014), 83% of French manufacturers sell services. The literature on servitization details the economic factors underlying this phenomenon. Facing exacerbated competition on stagnant markets, servitized firms develop a competitive advantage by greater differentiation through services rather than struggling exclusively with cost differentiation (Avadikyan et al., 2016; Bustinza et al., 2015). In doing so, they seek to set up higher barriers and lock-out effects by means of service-related contracts (Aghion & Bolton, 1987; Wise & Baumgartner, 1999).
Functional economy practices rely on the same core principle as servitization. Their primary innovative aspect lies in the way industrial exchange is made: the transfer of ownership of material goods is substituted by the sale of access rights to the function of use (Bourg & Buclet, 2005; du Tertre, 2008). Thus, like servitization, the functional economy depends on ‘exchanges not resulting in the transfer of property from seller to buyer [but] through access or temporary possession’ (Lightfoot et al., 2013, p. 1411, referring to Lovelock & Gummesson, 2004).
Nevertheless, the nascent literature on the functional economy has expanded the initial business focus of servitization to include environmental protection and sometimes even social aspects. In this view, product–service systems supporting servitized practices are also a way to create schemes of consumption based on products that are rented, shared, and pooled, consume fewer natural resources, and are more labor-intensive than the ones that are sold (Bourg & Buclet, 2005; Gaglio et al., 2011; Lauriol, 2008; Mont, 2002; Rothenberg, 2007; Tukker, 2004, 2015).
Since it first appeared in the French press in 2002, the discourse on servitization has increased in both quantity and complexity. Both terms, servitization and functional economy, are in use. Far from being monopolized by scholars, this discourse involves all types of actors, ranging from the business to the public sector, and contains multiple justifications for servitization, from economic to social ones. Thus, there is a promising field to observe how an innovative practice can be commonly theorized according to a priori heterogeneous institutional logics.
Data collection and setup
The empirical data consists of press articles, as well as archival records for the purpose of triangulation. Press articles were used as a proxy for investigating the research question. Included in media reports, press articles are a frequently studied vector of institutionalization (Fiss & Hirsch, 2005; Lok, 2010; Roulet, 2015; see also Wooten & Hoffman, 2016). They both reflect (Dowling & Pfeffer, 1975; Hybels et al., 1994) and influence the opinion of their audience (Deephouse, 1996; McCombs & Shaw, 1972). Hence, they have a direct impact on public opinion (Abrahamson & Fairchild, 1999; Bansal & Clelland, 2004) and practice engagement (Clemente & Roulet, 2015).
The press articles used in this study were retrieved from Europresse, one of the world’s largest francophone press databases. The request was based on the keywords functional economy (économie fonctionnelle, économie de fonctionnalité, économie de la fonctionnalité) and servitization (servicisation, servicization, servitisation, servitization, servicialisation, servicialization). Only the language (French) and geographical scope (France) filters were applied. This request by keywords delineated the boundaries of the discursive field of servitization (Daudigeos et al., 2013; Fiss & Hirsch, 2005; Reay & Jones, 2016). It also made it possible to broaden the focus from ‘prestigious media’ to all types of media and stakeholders (Roulet & Clemente, 2018; Wooten & Hoffman, 2016).
The Europresse data cover the period between June 2002 and January 2018 – the date of the first article about servitization in France and the time when the data were extracted, respectively. The process yielded a first set of 816 articles. After perusing, 206 articles were removed for three reasons. First, some articles were off-topic – for example, in the early 2000s, the term ‘functional economy’ (économie fonctionnelle) also referred to the economy of some Eastern European countries that were preparing to join the European Union market. Second, some of the articles were oversized, which was the case with public reports or legislative texts that had been extracted by mistake. And third, there were duplicate articles, for instance, when an article was published on both the paper version and the website of a given journal or magazine.
The 610 remaining press articles of the final corpus are presented in Table 1. They were coded according to three variables. The first variable was the keyword used to retrieve the article. It revealed common traits and differences in the patterns of words associated with servitization and functional economy. The second variable dealt with the press type of a given article. For each article, one of the following five press types was provided by Europresse: business & economics, environmental, general interest, government & public actors, and professional. This variable made it possible to examine how the discourse on servitization traveled among the audiences involved. The third variable indicated the year of publication. It was employed to define the discursive periods in which the hybridization dynamics took place.
Finally, archival data were leveraged for triangulation purposes to ensure the robustness of the overall analysis. It consisted of public reports and technical notes, as well as annual reports and registration documents produced by the main actors identified in the press corpus.
Descending hierarchical classification
In order to reveal the patterns of words signaling institutional logics, I employed a series of descending hierarchical classifications by means of the open software IRaMuTeq (Ratinaud & Marchand, 2012).
Descending hierarchical classifications are appropriate to perform longitudinal analyses of secondary data (Daudigeos et al., 2013; Mohr, 1998; Ventresca & Mohr 2002). They are a valuable statistical tool to deal with a corpus of texts that explicitly refers to the studied phenomenon. Moreover, they make it possible to follow a discourse across audiences and periods while mitigating potential bias as a result of the researcher’s subjectivity. Descending hierarchical classifications are rooted in the study of how words co-occur and have long been mobilized to understand the sociocultural construction of meaning (Burke, 1935; Mills, 1939, 1940). Recently, this approach by co-occurrence has repeatedly been adopted to track how institutional logics emerge and evolve (e.g., Dunn & Jones, 2010; Jones & Livne-Tarandach, 2008; Loewenstein et al., 2012; Reay & Jones, 2016; Weber et al., 2013).
Descending hierarchical classifications follow the mathematical developments of Reinert (1983), which include constructing clusters of words based on co-occurrence and frequency within text segments (Daudigeos et al., 2013). Hence, they provide characteristic patterns of words due to which a meaning can be inferred (Krippendorff, 2004). The linguistic assumption of this method is that the closer two words in a text are to each other, the more they are related in the writer’s and reader’s minds (Weber et al., 2013). This falls within the Saussurian tradition of structuralism, according to which meaning can only be assessed with respect to the position of words within a larger system. In this way, the patterns of relations between words become more important than the words themselves (Krippendorff, 2004; Loewenstein et al., 2012).
IRaMuTeq is a software interface for lexicometric analysis powered by the statistical program R. This software is similar to Alceste, which Daudigeos and his colleagues (2013) used to study the evolution of workplace safety during the 20th century in France. Besides basic lexicometry features, IRaMuTeq enables the user to configure descending hierarchical classifications according to a variety of parameters: text segment size, classification type (simple or double), and the number of lexical forms to be analyzed. It generates clusters made up of words and signal variables – in this case, the keyword, the press type, and the publishing year. For every word and signal variable, IRaMuTeq associates a chi-square (Karl Pearson’s χ2) that represents the strength of correlation within their respective clusters. In so doing, IRaMuTeq delivers the characteristic patterns of words that structure a discourse.
Analytical process
The analytical process comprised three series of steps. The first series aimed to capture the institutional logics at play in the discourse on servitization; the second series examined how these institutional logics shaped the theorization of servitization as a hybrid practice; and the third series studied the homogeneity of this theorization throughout audiences.
Capturing institutional logics through pattern matching
Pattern matching is a technique that compares and reconciles actual data with ideal types (Reay & Jones, 2016). This technique has been used, at times implicitly, in several major studies on institutional logics (e.g., Goodrick & Reay, 2011; Thornton, 2004). Following this technique, my first step was to prepare the data for proper observation, which meant applying a descending hierarchical classification to the whole corpus of press articles. Since press articles use a relatively standardized vocabulary and have short sentences, I selected the following parameter values: the text segment size to process was set at 40 words and the number of analyzed forms at 4,000. The adopted classification type was ‘simple’. The number of clusters of words was manually adjusted, while the coverage rate of text segments was controlled. Finally, I performed a robustness test to ensure the stability of results: six other classifications were launched with complementary parameter values. They provided minor variations Table 1.
The second step involved drawing on extant literature to build an ideal type-based framework. The use of prior works on servitization (Baines et al., 2009; Vandermerwe & Rada, 1988), product–service systems (Mont, 2002; Tukker, 2004, 2015), and the functional economy (Bourg & Buclet, 2005; Gaglio et al., 2011) orientated the analysis toward relevant ideal types: the market/corporate, the natural environment, and the state. The patterns of behavior and elemental categories associated with these ideal types were apprehended by mobilizing relevant research in the institutional logics literature (Ansari et al., 2013; Friedland & Alford, 1991; Thornton et al., 2012; York et al., 2016a) and hybrid organizing (e.g., Pache & Santos, 2013; York et al. 2016a). Then, a coherent set of elemental categories was formed to guide the assessment of empirical data in making the institutional logics apparent: sources of identity, legitimacy, and authority, as well as bases of norms, attention, and strategy. This set was formed based on the building blocks approach of ideal type analytics while considering the research goal and context (Thornton et al., 2012).
The third step was to evaluate the data in order to determine the extent to which it matched the ideal types. To that end, the meaning of most central patterns of words was inferred after perusing the press corpus, scrutinizing the most representative verbatims provided by IRaMuTeq, and triangulating with secondary sources of data. Along with the work of Daudigeos and colleagues (2013), the categories offered by DiMaggio and Mullen (2000) guided this first analysis, namely, the social issues at stake, actors involved, repertoires of legitimate actions, and objects of actions. Then, institutional logics were named and characterized by comparing elemental categories with data.
Retracing the theorization of servitization as a hybrid practice
This series included two steps aimed at showing when and how the institutional logics at play shaped the theorization of servitization as a hybrid practice.
First, I tracked the discursive dynamics surrounding servitization to better understand how logics were ordered over time. By means of successive period-related descending hierarchical classifications, I identified periods characterized by internal discursive continuities and discontinuities at their edges (Langley, 1999). I proceeded by accretion: the first classification included the press articles published from 2002 to 2007. Every subsequent year was then added to all the former ones within a new classification. The coverage rate of text segments was permanently controlled. Thus, I was able to identify diachronic changes (Barley, 1990): years from which the discourse structure had evolved. On this basis, using secondary data sources, I looked for ‘critical junctures’ (Sewell, 1996): events giving way to new institutional logics to reframe servitization, as well as its effect on institutionalization.
Second, I examined how the identified institutional logics successively supported the theorization of servitization as a hybrid practice. To that end, for each cluster of words of all the descending hierarchical classifications, I first collected and investigated the text segments that explicitly describe the practice under study. In so doing, I was able to observe the multiple and complementary goals, framings, and justifications ascribed to servitization by the relevant institutional logics. Next, I triangulated the content of these text segments by using secondary sources of data to confirm that these elements – goals, framings, and justifications – compounded an integrated whole, which fully underpinned the theorization of servitization as a hybrid practice.
Investigating the cohesiveness of the theorization of servitization throughout audiences
This final analytical step concentrated on the factors of expansiveness and cohesiveness in the theorization of servitization as a hybrid practice. I examined the causes of discursive constancy and variations among the different press types. The first analysis focused on the descending hierarchical classification of the overall corpus. It looked into how the keyword variable (servitization or functional economy) and the press type variable (business & economics, environmental, general interest, government & public actors, or professional) correlated with the word clusters. For the purposes of robustness, this analysis was repeated for each of the five press-type-related sub-corpuses. Thus, five more descending hierarchical classifications were launched, manually adjusted to have the same number of clusters, and controlled in terms of the coverage rate of the text segments. (Supplementary Table 2).
The role of discourse in the theorization of servitization as a hybrid practice
The findings are structured as follows: the first section shows the institutional logics at play in the discourse on servitization. The second section looks at when and how these institutional logics prompted the theorization of servitization as a hybrid practice. The third section examines how this theorization could be homogeneously shared by every component of the field.
The competing logics at play in the discourse on servitization
The investigation of the studied corpus identified and characterized three institutional logics: the servitized logic, the environmental protection logic, and the social welfare logic. Capturing these logics required a comparison of the meanings inferred from the descending hierarchical classification with insights drawn from the literature.
Ten clusters of words covering 89.48% of the 15,258 text segments of the corpus between 2002 and 2018 were identified by means of descending hierarchical classification. For each cluster, Figure 1 offers the 15 most correlated words and significantly correlated signal variable modalities, as measured by their Pearson chi-square (χ2). The words directly retrieved from the clusters of the descending hierarchical classification will be written in italics. When not indicated in Figure 1, their associated Pearson χ2 is mentioned in brackets.
Figure 1. Descending hierarchical classification resulting from the overall corpus
Parameters: Classification type: simple; Number of analyzed forms: 3,679 (≥ 8); Average number of forms per text segment: 35.896.
Except for clusters 1 and 2, all clusters were entirely ascribable to an institutional logic. Clusters 1 and 2 described the issue around which the field formed, as well as this issue’s implications for the field’s components. Cluster 1 referred to a vocabulary of crisis (χ2 = 98.71), entailing deep problems with multiple aspects such as climatic change or warming, inequality and poverty, and employment and growth. Consequently, Cluster 2 reminded of the need (χ2 = 75.03) for change involving diverse actors (economic, social, and political) to face (χ2 = 155.40) the cause of the situation and to foster the implementation of new models, practices, and roles. This issue was situated at both macro (country and civilization) and organizational (business) (χ2 = 98.71) levels:
Our social model is built on sharing the fruits of growth. Thus, growth seems to be the only way to maintain the distribution of welfare. To get out of this job/environment, growth/degrowth opposition, should we not question, first of all, our model of consumption? (Le Monde, December 2012)
There are four forces of change that lead to the emergence of new business models: the development of the internet and the digital world, the necessary energy transition, the economic crisis, and the influence of global demographics on business demography. (La Tribune, July 2015)
Servitized logic
The servitized logic is embedded in the market (Friedland & Alford, 1991) and corporate (Thornton, 2004) ideal types. These ideal types guide recurrent behaviors regarding the sale of differentiated and competitive products and services on the market. They help pursue an economic surplus by prescribing efficiency and control in the allocation of financial, human, and technological resources (D’Aunno et al., 2000). These ideal types are embodied by for-profit organizations, which are perceived as appropriate forms to sustain competitive advantage (Pache & Santos, 2013) and efficiency in resource allocation (Fligstein, 1996). Within these organizations, managers exert administrative control in a hierarchical way to monitor financial, product, and service performance on behalf of owners (Pache & Santos, 2013; Thornton, 2004).
In the data, the servitized logic was expressed by clusters 3, 4, and 8. These clusters covered 7.2, 8.9, and 13.4%, respectively, of the text segments in the descending hierarchical classification. They revealed a social issue about value creation and gain in work productivity through service (servicial, servitization). In this logic, the focal actors were private firms like Google, Michelin, and Xerox (χ2 = 216.20), as well as their counterparts: beneficiary or customer (χ2 = 228.17). Legitimate actions dealt with matters of commerce (to sell, to rent, renting, sales, to buy, to propose) and organization management (to connect, marketing, measurable, job, and activity). Objects of action concerning commercial matters were physical goods and product – car, vehicle, tire, machine, automobile, bike – and their functional (χ2 = 252.50) use (e.g., kilometers). Organizational objects mainly included information technology (big data, digital, digit, internet, web, cloud, and algorithm) and immaterial quality.
Following these results, Table 2 presents the elemental categories that comprise the servitized logic. Actors draw their identity from the commercialization mode of physical products; in line with the literature, these actors sell the use of a product instead of the product itself. Although a physical product systematically underpins the economic exchange, there is no transfer of property. For example, when Google sells information storage through cloud solutions, it does not sell a physical IT server. Michelin sells tons per transported kilometer instead of tires; Xerox sells copies instead of photocopiers.
The servitized logic grants legitimacy to leading companies operating through service on markets of physical products that are saturated (e.g., photocopiers) and/or products whose intrinsic characteristics are hardly differentiable (e.g., tires). As for-profit organizations, these actors are subject to their owners’ authority, which is expressed through equity markets or management boards. The basis of norms is to create an economic surplus, which supposes creating value for the customer. In this sense, the basis of attention is focused on profitability and market share. It is addressed by the deployment of commercial and organizational skills as a basis of strategy.
Environmental protection logic
According to the existing literature, the environmental protection logic does not originate from an ideal type as such. Instead, it is characterized by the core belief that natural resources are finite, that humans and the biosphere are interdependent, and that the former have to actively preserve the latter (Boulding & Jarrett, 1966; Frederick, 1995). In this view, concerns about climate, in particular, have given rise to a transnational logic of collective action, affecting the cultural foundations of industrialized societies (Ansari et al., 2013). This culturally derived belief prioritizes the ‘goals of environmental preservation, and recognizes nature’s inherent moral value’ (York et al., 2016a). It legitimizes practices that help conserve nature and life (Mars & Lounsbury, 2009; York et al. 2016a, 2016b), such as those related to the ecological industry (Erkman, 1997), the circular economy (Ghisellini et al., 2016; Murray et al., 2017), or renewable energies (Jay, 2013; York et al., 2016a).
In the discourse on servitization, the environmental protection logic is essentially represented by Cluster 6, which covered 8.6% of the text segments in the descending hierarchical classification, and by Cluster 7, which comprised 7.8%. In Cluster 9 (10.5%), patterns of words prompting the environmental protection logic were intertwined with ones signaling the welfare logic.
According to the descending hierarchical classification, the social issue focused on how to reduce production and consumption of energy and resources. As mentioned in Cluster 2, actors embodying this logic were organizations such as the ADEME, the national agency for the environment and energy management, run by the Ministry of the Environment; the National Institute for the Circular Economy (χ2 = 282.18), which gathers public and private actors under the chairmanship of environmentalist politician François-Michel Lambert; the Ellen MacArthur Foundation (χ2 = 295.77), which works on the circular economy; and environmental activist Nicolas Hulot, who chairs his namesake foundation.
In this data set, the environmental protection logic delegitimized actions relating to the threefold characteristic of the linear (χ2 = 202.75) economy: to extract, to consume, and to discard (χ2 = 223.10). Instead, it prescribed legitimate actions focused on protecting the natural environment, such as recycling, reuse, reemployment, eco-design, waste sorting and collection (χ2 = 246.28), recovery, and repair. These actions were expected to apply to objects like greenhouse gas emission, CO2, water, electricity from renewable energy, and matter – for example, packaging, plastic, and product.
The elemental categories that characterize the environmental protection logic are shown in Table 2. As indicated, actors embedded in this logic forge their identity in the rising concerns about climate change and resource depletion. They consider their own fate to be intertwined with that of the natural environment. In this view, legitimacy is drawn from the ability to implement and disseminate production and consumption practices that consume fewer natural resources. Two sources of authority constrain and enable environmental action. First, financial markets constrain firms to consider the natural environment in terms of risk and performance:
Used vehicle parts are reused after repair for after-sales service operations at a 30% to 50% lower cost. Any loss of raw material is limited. For example, Renault collects automotive electrical harnesses to recover the copper. ‘We try to become less sensitive to commodity prices by reusing as much material as possible. Thanks to this system, we’ve become independent when it comes to copper,’ explains Laurent Claude [Business Developer at Renault]. (Les Echos, January 2015)
The environmental services giant Veolia has launched a new business model: the rental of solvents […] After the solvent is used and starts losing its properties, [it is] regenerated. Between evaporation and distillation, the recovery rates of the product are between 75% and 80%. ‘Veolia’s interest is to get out of the price of raw materials, especially that of xylene, which fluctuates a lot. Customers’ interest is to recover products that are 25% to 50% cheaper,’ says Estelle Brachlianoff, Senior Executive Vice-President for the UK and Ireland at Veolia. (L’Usine Nouvelle, 2015)
Second, public authorities compel economic agents to consider the environment by means of regulation:
In 2015, from the Energy Transition Law to COP21, public authorities wanted to promote this new economic philosophy, which in the long run was supposed to replace the linear model that the industrial revolution had imposed at the end of the 18th century – to extract, to manufacture, to consume, to discard. (Challenges, June 2016)
In any case, the basis of norms is the preservation of the natural environment, and the basis of attention is the intensity of resource consumption and greenhouse gas emissions in economic exchanges. To address this basis of attention, the basis of strategy consists of an increase in energy and material efficiency throughout the whole product lifecycle by increasing the lifespan of products – reuse, repair – and matter – recycling.
Social welfare logic
The social welfare logic is derived from the ideal type of the state (Friedland & Alford, 1991; Thornton et al., 2012). It steers action toward securing social and political order (Dobbin & Dowd, 1997) at national or subnational levels (Marquis & Lounsbury, 2007), while considering a plurality of expressions (Polsby, 1980). In doing so, it can focus on overall employment and wealth redistribution issues (Greenwood et al., 2010; Thornton et al., 2012) or address more local social needs (Pache & Santos, 2013). To allow for the representation and participation of all the stakeholders, the social welfare logic defines bureaucratic procedures and democratic control over regulative public bodies as the appropriate means to monitor action (Friedland & Alford, 1991; Thornton et al., 2012).
In the discourse on servitization, the social welfare logic was mainly evident in clusters 5, 9, and 10. These clusters represented 7.0, 10.5, and 13.6%, respectively, of the text segments in the descending hierarchical classification. The social issue at stake was how to maintain employment and reduce poverty and inequality in a context of crisis. It involved actors and actions operating at both national and local levels.
At the national level, actors operated in national democratic institutions – minister, senator (χ2 = 298.03), and Member of Parliament (MP) – or as public officers – public purchaser. The repertoire of legitimate actions consisted of exerting political power (to announce [χ2 = 108.95], to launch [χ2 = 106.06]), legislative power (to publish [χ2 = 219.46], to vote [χ2 = 137.16]), and executive power (execution, diffusion [χ2 = 217.68], and elaboration [χ2 = 211.53)). The political actions targeted objects, such as conference or the National Strategy for Sustainable Development (NSSD). The legislative actions addressed objects, such as article, law, or amendment (χ2 = 75.46). The executive actions dealt with objects of the enactment of legislative texts, such as the public procurement code and public bid offer modalities – objective, criterion, indicator, and procedure.
At the local level, for example, in Lille or in Saint-Etienne, a plurality of actors involved in the discourse on servitization were bound by a regional anchoring. On that basis, actors can be individuals (e.g., director, president, chief, and founder), public organizations (e.g., association, university, and laboratory), private organizations (e.g., consultancy, firm, and business school), or nongovernmental organizations (NGOs) (χ2 = 41.38). Legitimate actions aimed to gather actors together (χ2 = 40.84) so as to stir (χ2 = 45.16), to lead (χ2 = 61.89), and to assist (χ2 = 71.43) objects like hub, club, project, and cluster for competitiveness (χ2 = 45.16) and development (χ2 = 61.57) in a given territory (χ2 = 49.17): French department (χ2 = 126.10), region (χ2 = 118.74), or metropolitan area (χ2 = 56.01).
Thus, as shown in Table 2, these actors’ source of identity is located in the economic and social crisis in which the discourse on servitization took place. In this context, legitimacy is conferred on actors and practices perceived as being able to contribute to the general interest. Sources of authorities were uncovered at national and local levels – in democratic bodies and local authorities (e.g., regional councils), respectively. The basis of norms prompted behaviors favoring wealth creation and redistribution throughout the social system, while attention focused on macroeconomic indicators such as gross domestic product (GDP) or employment rates. The basis of strategy leans on public procurement and the coordination of all economic and social actors around territorial projects.
Consequently, three institutional logics were at play in the discourse on servitization: servitized, environmental protection, and social welfare. Institutional logics by nature prescribe practices in a specific way (Friedland & Alford, 1991). And in the present case, the relation between the servitized logic and the social welfare logic was characterized as being contradictory. The former was geared toward maximizing the profit of private actors, while the latter prescribed the equitable distribution of wealth to each component of the society. However, although contradictory, these institutional logics were brought together in the theorization of servitization, thereby conferring a hybrid character on this practice.
The theorization dynamic of servitization as a hybrid practice
The dynamic of the theorization of servitization was revealed through an analysis of both the overall and the period-related descending hierarchical classifications, triangulated with archival data. The results indicated that the three institutional logics expounded in the previous section remained present in the discourse throughout the study period (Table 3).
That being observed, an in-depth analysis yielded evidence that these logics shaped the theorization of servitization in different ways, depending on two overlapping periods (Table 4). Importantly, along this two-period incremental theorization, the environmental protection logic was found to be a key mechanism. It played a pivotal role by bringing together the servitized and social welfare logics. Thus, servitization acquired a hybrid character, thereby garnering social approval from heterogeneous audiences and, in turn, pursuing its institutionalization.
Period I: From commercial to environmental concerns – The inclusion of servitization on the political agenda (2002–2010)
All three institutional logics appeared in the very first years after servitization had made its debut in the public discourse. As shown in Table 3, from 2002 to 2010, the period-related descending hierarchical classifications of the corpus constantly reported patterns of words reflecting the servitized logic (e.g., firm, to rent, consumption, and to sell), environmental protection logic (e.g., renewable, natural, resource, and climatic), and social welfare logic (e.g., candidate, political, Sarkozy [former French president], socialist, and NSSD – national strategy for sustainable development).
During this time, these institutional logics gave rise to the first theorization of servitization as a hybrid practice (Table 4). Importantly, although this first theorization emerged during Period I, it remained valid throughout the whole study period, from 2002 to 2018, as evidenced by the selected data samples.
The initial justification of servitization laid in its capacity to develop a competitive advantage. It consisted in an alternative offer based on service that was put forward long before the notion of servitization ever entered public discourse (Vandermerwe & Rada, 1988). The idea of mobilizing servitization to gain market share and customer loyalty was soon relayed through the press. As explained in a major business journal:
Bibendum [Michelin] wants to sell fewer tires to HGV companies. But it is not a symptom of madness. The goal is to increase its turnover. The firm just prefers to own its tires and to bill the kilometers they travel. […] Since 2001, this offer has seduced and gained the loyalty of more and more transport companies. Michelin, which already charges miles for London buses and landing several airlines, now plans to approach the fleets of rental cars. (Les Echos, July 2008)
Michelin presented its servitization know-how in the ‘Innovation and Differentiation’ chapter of its registration documents. The discourse also contains plenty of examples of servitized firms in both the B2B and the B2C sectors. In the B2B sector, in addition to the emblematic examples of Michelin and Xerox, Elis has been cited repeatedly for its workwear and textile rental offer. The company has incorporated servitization into its core business:
Elis, the multi-service leader in the rental, laundry and maintenance of flat linen, workwear and hygiene and well-being appliances in Europe and Latin America. Elis’ business model consists of renting articles rather than selling them. It therefore supports cost control, guaranteed quality control and an active environmentally responsible approach. This circular model is the sign of an industrial know-how that we provide our customers so that they can concentrate on their core business. (Elis, Registration document, 2016, p. 5)
In the B2C domain, the press corpus provided the example of Seb, which rents out domestic electrical supplies. This offer emphasized the advantages for customers to break free from the costs and constraints related to ownership.
Servitization was subsequently broadened to include environmental concerns as well. This expansion expressed both the servitized and the social welfare logics mediated through the environmental protection logic. From a servitized logic perspective, the practice was considered an answer to the costs and risks relating to bullish trends on energy and raw materials markets, as well as the risks related to growing legislative pressure to diminish energy consumption, waste production, and greenhouse gas emissions. In the data, this ‘servitized environmental’ view was voiced in the narratives of both startups and multinational servitized companies. For example, the startup Clarlight (Cluster 8, χ2 = 94.31) sells clars (Cluster 8, χ2 = 95.11) as performance units of its lighting systems to develop a competitive advantage based on environmental performance:
The clar concept is a win-win model that combines profitability with environmental and societal performance. It is a way to save without investing thanks to an immediate reduction in the lighting costs and a significant reduction in electricity consumption. (Logistique Magazine, Professional press, March 2017)
Similarly, multinational servitized companies justify how their product–service offers perform both environmentally and economically for their clients and for society more broadly:
In 2008, within the framework of the [government-run] Grenelle environmental summit in France, Elis contributed to the work dedicated to the service economy. The study carried out showed that hiring clothing from Elis helps to cut energy consumption or carbon dioxide emissions by around half compared with buying clothing with professional in-house maintenance, and divides water consumption by around 10 times. (Elis, Annual Financial Report, 2014, p. 102)
Actively improving the energy performance of business fleets – Another pathway to reducing the Group’s carbon emissions concerns the product-service economy, which involves […] the combined supply of a product and a service to manage and maintain tires in ways that optimize their energy efficiency and other performance features […] These solutions are then marketed and supported close to customers in the different Regions, enabling them to optimize fleet management, improve margins and reduce their carbon footprint. (Michelin, Registration document, 2018, p. 261)
From a social welfare logic, the environment was not perceived as a risk for private interests but framed as a common good to preserve. Hence, servitization was justified to ease the pressure on natural (Cluster 7, χ2 = 145.77) resources. Specifically, it was promoted for its potential to end planned (Cluster 9, χ2 = 56.60) obsolescence (Cluster 9, χ2 = 41.86) and to uncouple wealth creation from natural resource consumption at the macro level. This ‘social welfare environmental’ view was expressed both in archival data and in press articles related to general public opinion. In this view, servitization was referred to as the ‘functional economy’:
The functional economy can logically appear as a pathway to sustainable development reconciling economic growth and environment. A producer who sells goods has an interest in selling as many of them as possible and, therefore, in shortening their lifespan (planned obsolescence), while the producer who sells them only for their use (service) has an interest in extending their lifespan to reduce the cost of producing them. As a result, the modification of the origin of the profit for the producer (the good in one case, the function of use in the other) brings profound modifications to the economic models: maintenance of the property of the material support and, thus, the extended responsibility of the producer, modification of the internal organization of the company and billing according to the intensity of use. Therefore, the transition to the functional economy can pave the way for a reduction in the consumption of resources (reduction of material and energy flows) and the associated environmental impacts. (Final report submitted to the Ministry of the Environment following the Grenelle Environment Conference, 2008, p. 2)
Imagine a company that not just seeks to produce a high volume of goods that it then sells but provides its client with integrated solutions of services and goods based on the sale of use or a performance of use. It’s the functional economy, and the planet has everything to gain from it. In this model, the company most often owns the property of the goods it has manufactured and, therefore, has a strong interest in it lasting as long as possible. (20 Minutes, June 2017)
As a result, the ‘social welfare environmental’ view has integrated servitization into a wide range of environmental practices within the overarching model of the circular economy. This environmental potential of servitization dovetails with the literature on product–service systems (Mont, 2002; Tukker, 2004, 2015). In empirical data, as expressed in Cluster 6, servitization is framed to reduce energy and material consumption throughout the whole product lifecycle (χ2 = 159.71). Upstream, the optimization of the use of material resources involves the implementation of eco-design within manufacturing processes. The lengthening (χ2 = 148.10) of the usage phase span relies on items being easy to repair, reuse, or re-employ. Downstream, the fact that sellers have ownership over the product at the end of its life is presented as leverage to improve waste collection (χ2 = 246.28), sorting, and treatment (χ2 = 246.28). As summarized in a leading publication for public actors:
Although the definition of the circular economy concept has not been stabilized, its stakes are described by the ADEME [French Environment and Energy Management Agency] and UNEP [United Nations Environment Programme]. ADEME defines it as ‘an economic system of exchange and production that, at all stages of the lifecycle of products (goods and services), aims to increase the efficiency of resources and reduce the impact on the environment.’ The concept encompasses the following seven pillars: sustainable supply, eco-design, industrial and territorial ecology, functional economy, responsible consumption, extension of the [products’] duration of use, and recycling. (La Gazette des Communes, 2014)
As an institutional outcome theorized in this way, servitization stopped being the prerogative of business actors. From this period onward, it was incorporated into a range of political, executive, and legislative texts, such as the National Strategy for Sustainable Development and Grenelle Acts I and II, which were voted on in 2009 and 2010 to implement long-term and societal-scale decisions about the natural environment. At this stage, servitization became a matter of alternative production and consumption schemes including environmental gains. Nevertheless, any ‘merely’ social concerns had so far been excluded. Specifically, the final report to the Ministry of the Environment dealing with it omitted any reference to social preoccupations (Folz et al., 2008).
Period II: Servitization and social welfare, theorization completeness, and broader implementation (2011–2018)
All three institutional logics remained active throughout this period. However, from 2011, two new patterns of words started to appear along with the previous ones (Table 3): the first pattern dealt with social concerns after the crisis (e.g., question, wage, to change, and social), and the second pattern referred to innovations carried by all types of actors on the ground (e.g., territory, citizen, project, firm, regional, and local). These two patterns revealed the emergence of the last component of theorization as a hybrid practice – the social welfare logic was directly expressing itself in a new way (Table 4).
According to the ‘merely’ social welfare logic, servitization was framed to preserve employment and to stimulate local wealth creation and redistribution:
The circular economy brings with it another model of functioning for our economies, restrained in terms of resources, relying on partnerships, even collaborative, and reducing environmental impacts. It is an opportunity not only for savings but also for business creation and jobs: According to a study by the European Commission at the end of 2012, it could generate between 200,000 and 400,000 jobs in France. Initiatives in the field are proliferating. Large companies are changing their business model: Xerox sells the use of its photocopiers rather than the machines themselves; Michelin, in the heavy goods vehicle sector, sells kilometers traveled instead of tires. (Environnement Magazine, May 2015)
Public–private partnerships may have been the most tangible social-value targeted offers relying on servitization due to the ad hoc mobility infrastructures they entailed. As expressed in Cluster 8, Vélib’ (χ2 = 126.08) and Autolib’ (χ2 = 145.50) were bike- and car-sharing systems used as emblematic examples to describe these organizations that associate private and public actors:
With the offer of bike and car self-service, local authorities are actors in the functional economy, which is based on the use of the good and not on owning it. For the same global mobility, material consumption is lower with shared vehicles than with individual vehicles. And this system generates local activity: user management, park maintenance, etc. (La Gazette des Communes, 2013)
Thus, mobility sharing systems involve products that are maintained in situ but can be manufactured anywhere. Employment happens at the site of consumption. Servitization has benefited from this last complementary social justification, which ended its hybridization and favored the support of a wide range of social and economic actors.
The theorization of servitization as a hybrid practice was completed during Period II. In the aftermath of the global financial crisis, pressing social concerns led to an objective/frame/justification trio, promoting servitization as a practice also geared toward distributing wealth among heterogeneous stakeholders throughout the territories.
The four-component theorization that resulted was enacted in the Energy Transition for Green Growth Act (2014) as a ‘pillar’ of the overarching model of the circular economy. The newly created Institute for the Circular Economy (2013) and the French Environment and Energy Management Agency (ADEME) maintained this theorization. Subsequently, funding programs and subsidies started being devoted to ramp up pilot projects in regions. This period also saw the implementation of servitization in both private and public national organizations. On the private actors’ side, patterns of words corresponding to digital technologies appeared. On the public actors’ side, the implementation was signaled by words referring to public procurement aligned with environmental goals.
In short, servitization was theorized from two a priori conflicting institutional logics mediated by a third one. The initial theorization of servitization was underpinned by the servitized logic. This was then maintained and enriched by the environmental protection logic: servitization was justifiable in order to gain both economic and environmental competitive advantages. On this basis, the potential for servitization to preserve the natural environment as a common good led to a third theorization component at the intersection of the environmental protection and the social welfare logics. It made the practice available to a complementary theorization under the aegis of a ‘merely’ social welfare logic: the practice was once more reframed to redistribute social welfare through territorial development and employment stimulation.
Due to the rise in the number of published press articles (Table 1), the development of this complete theorization involved new and original audiences. As a result, servitization became hybrid. That is, if one of its components fell, the overall theorization would collapse, sending servitization back to its primary (economic), if not secondary (economic-environmental), meaning and causing it to lose some of its endorsers. To maintain this theorization as a cohesive whole throughout audiences, an additional discursive mechanism played a key role.
The cohesiveness of the theorization of servitization among audiences
This last part of the results showed to what extent the full theorization of servitization was shared among audiences. Two analyses concentrated on the cohesiveness of the interrelated components of this theorization. Importantly, these analyses highlighted that renaming servitization the ‘functional economy’ was a key hybridization mechanism.
The investigation of the overall and press-type descending hierarchical classifications first accounted for the consistencies and the variations of clusters across audiences. Two types of clusters remained remarkably constant in terms of content. First, Figure 1, Cluster 8 of the overall corpus, which refers to the sales model based on product use and performance (to sell, to rent, renting, and use), remained largely identifiable within all the sub-corpus classifications (Table 5, shaded areas). Second, the clusters related to the environmental vocabulary – overall corpus, clusters 6 and 7 – percolated throughout all the audiences despite minor variations (Table 5, dotted frames). In every sub-corpus, varying content clusters were positioned around these two clusters containing constant patterns of words.
| Cluster 1 | Cluster 2 | Cluster 3 | Cluster 4 | Cluster 5 | Cluster 6 | |
| Business & economics press | ||||||
| development (168.65) |
digital (232.66) |
renting (194.68) |
matter (450.88) |
work (414.05) |
nord (218.04) |
|
| sustainable (137.29) |
data (204.76) |
sales (185.78) |
waste (318.67) |
employment (180.70) |
cci (181.43) |
|
| csr (111.69) |
insurer (116.64) |
to sell (178.02) |
circular (302.09) |
relevance (175.88) |
funds (179.12) |
|
| economic (93.35) |
to connect (102.40) |
machine (176.71) |
energy (252.45) |
hr (131.16) |
calais (165.39) |
|
| model (73.51) |
firm (97.06) |
to rent (148.35) |
economy (227.23) |
productivity (128.48) |
third (147.96) |
|
| *kw_ef (25.10) | *kw_se (245.17) | *kw_ef (31.23) | *kw_ef (193.39) | *kw_se (609.09) | *kw_ef (119.08) | |
| Environmental press | ||||||
| circular (232.81) |
president (97.10) |
waste (320.57) |
resource (93.66) |
funds (224.53) |
use (104.08) |
|
| economy (137.11) |
director (79.42) |
reuse (141.97) |
economic (52.36) |
euro (201.23) |
renting (103.19) |
|
| paris (90.97) |
sustainable (75.94) |
sector (114.64) |
question (44.97) |
nord (159.79) |
customer (90.87) |
|
| national (87.95) |
committee (73.78) |
recycling (94.40) |
natural (43.89) |
investment (124.08) |
michelin (71.41) |
|
| institute (77.60) |
association (53.94) |
epr* (77.55) |
consumption (39.12) |
project (97.28) |
sales (64.36) |
|
| n/a | n/a | n/a | n/a | n/a | n/a | |
| General press | ||||||
| social (114.16) |
director (238.81) |
project (368.15) |
to rent (379.10) |
waste (316.16) |
political (95.70) |
|
| economic (73.08) |
lille (236.60) |
call (191.08) |
to sell (363.76) |
matter (219.02) |
problem (94.96) |
|
| challenge (62.08) |
philippe (154.47) |
territory (187.31) |
renting (320.87) |
recycling (151.02) |
question (91.32) |
|
| human (54.37) |
consultancy (149.36) |
region (150.58) |
use (255.84) |
energy (120.59) |
thing (80.76) |
|
| model (52.50) |
chief (136.39) |
regional (141.71) |
functionality (197.97) |
production (115.56) |
inequality (64.53) |
|
| *kw_se (25.88) | *kw_ef (30.20) | *kw_ef (32.69) | *kw_ef (7.53) | *kw_ef (21.80) | *kw_se (123.25) | |
| Government & Public actors press | ||||||
| notice (160.47) |
social (108.94) |
to rent (165.16) |
bank (67.66) |
innovation (458.54) |
cicular (303.65) |
|
| parties (120.83) |
to take (93.16) |
renting (140.91) |
economist (58.27) |
territory (147.18) |
economy (236.29) |
|
| sustainable (112.87) |
nssd (88.09) |
offer (113.39) |
to show (54.16) |
territorial (123.87) |
waste (192.54) |
|
| esec (103.83) |
objective (83.27) |
collaborative (84.46) |
credit (42.17) |
cluster (103.85) |
recycling (138.06) |
|
| consultation (99.27) |
challenge (73.78) |
car (80.04) |
alternative (37.26) |
actor (87.20) |
energetics (76.21) |
|
| *kw_ef (3.58) | *kw_ef (2.55) | *kw_ef (2.62) | *kw_se (105.18) | *kw_ef (5.08) | *kw_ef (11.47) | |
| Professional press | ||||||
| employment (76.12) |
public (593.89) |
planned (274.98) |
model (91.43) |
store (297.52) |
vehicle (185.13) |
|
| value (65.00) |
procurement (214.67) |
obsolescence (263.90) |
to connect (76.22) |
to teach (226.56) |
light (140.17) |
|
| work (61.56) |
objective (167.05) |
lifespan (163.01) |
brand (72.76) |
section (96.45) |
lighting (110.48) |
|
| to create (51.11) |
purchaser (145.59) |
senate (106.14) |
object (55.93) |
cash desk (67.70) |
automobile (99.40) |
|
| key (45.34) |
sustainable (145.35) |
law (97.57) |
marketing (55.93) |
hypermarket (67.70) |
clarlight (89.50) |
|
| n/a | *kw_ef (60.18) | *kw_ef (34.10) | *kw_se (18.49) | *kw_se (253.18) | *kw_ef (25.79) | |
| Legend: Servitized ; Environmental ; * extended producer responsibility. | ||||||
The second investigation shed light on the role of words in sustaining the theorization of servitization as a hybrid practice. Indeed, the examination of the descending hierarchical classifications of the overall corpus drew attention to the name – ‘servitization’ versus ‘functional economy’ – that was used to describe and justify servitization throughout audiences. The keyword ‘servitization’ was reserved for commercial and organizational matters exclusively and used to address business and economics audiences. As Figure 1 shows, the keyword ‘servitization’ was highly correlated with clusters 3 (χ2 = 513.04) and 4 (χ2 = 1506.19), while these clusters were also significantly associated with the Business & Economics press type (Cluster 3, χ2 = 224.13; Cluster 4, χ2 = 72.51). This first clue was confirmed when analyzing the press-related descending hierarchical classifications (Table 5). Again, the keyword ‘servitization’ was highly associated with business matters in the following press types: Business & Economics (Cluster 2, χ2 = 245.17; Cluster 5, χ2 = 609.09), Government and Public Actors (Cluster 4, χ2 = 105.18), and Professional (Cluster 4, χ2 = 18.49; Cluster 5, χ2 = 253.18). In the General Press (Cluster 1, χ2 = 25.88; Cluster 6, χ2 = 123.25), the practices designated by the term ‘servitization’ were even negatively framed (Fiss & Hirsch, 2005). They were decried for the outrageous commodification of private life that servitization is likely to imply:
We are currently witnessing a generalized ‘servitization’ of life. It is a matter of transforming any data into personalized services that are supposed to offer additional comfort and security. […] This information can be collected by multiple third parties to offer products or services that suit each individual but often respond simplistically to deficiencies. It is this model, which in the name of economic growth is supported by public funds and is at the core of the activity of French tech, for example, that is defended by the government and the Secretary of State for the Digital Sector. They seem so obsessed with the goal of growth that they are incapable of realizing not only the societal but, more broadly, the civilizational consequences of this unbridled commodification of every aspect of life. (L’Humanité, April 2015)
Conversely, the parts of the discourse supporting environmental and social gains associated with selling the use of products referred to the keyword ‘functional economy’. Figure 1 shows that the vocabulary related to the environment, conveyed by clusters 6 and 7, was significantly associated with the keyword ‘functional economy’ with a χ2 of 144.41 and 84.01, respectively. The results summarized in Table 5 confirm this environmental vocabulary/keyword association: in the Business & Economics press (Cluster 4, χ2 = 193.39), in the General press (Cluster 5, χ2 = 21.80), in the Government and Public Actors press (Cluster 6, χ2 = 11.47), and in the Professional press (Cluster 3, χ2 = 34.10).
Likewise, the clusters supporting the social aspect of servitization were associated with the keyword ‘functional economy’. Clusters 5, 9, and 10 in Figure 1 materialized this strong association with a χ2 of 51.98, 150.54, and 105.26, respectively. Furthermore, clusters 5 and 9 were significantly correlated with the Government and Public Actors press (χ2 = 229.87 and χ2 = 42.20).
This sub-corpus analysis confirmed the social expectations raised by servitization when it is renamed ‘functional economy’. In the Business and Economics corpus, these social aspects carried by the string ‘functional economy’ were indirectly present in Cluster 1 (χ2 = 25.10), which was structured around keywords like sustainable development and corporate social responsibility (CSR). Cluster 6 was associated with this keyword (χ2 = 119.08) to describe public funds dedicated to fostering the functional economy in the Nord-Pas-de-Calais region. Similarly, the keyword ‘functional economy’ was employed to advance the supposed territorial benefits of servitization in the corpuses of General (Cluster 2, χ2 = 30.20; Cluster 3, χ2 = 32.69) and Government and Public Actors press (Cluster 2, χ2 = 2.55; Cluster 6, χ2 = 11.47). By using this keyword in the Professional press corpus, new public procurement procedures, mastered by public actors, were described as being aimed at spreading servitization as part of sustainable development (Cluster 2, χ2 = 60.18).
In summary, this last section suggested that the servitized logic traveled among audiences when it happened alongside the environmental protection logic. It also showed that a shift in words designating a practice makes it possible to expand its frame and justification. The term ‘servitization’ was limited to businesses and organizational matters. Conversely, ‘functional economy’ played the role of an umbrella term, covering business, the natural environment, and social aspects, all of which were addressed to several audiences.
Summary
These results shed light on two key mechanisms enabled by discourses to give rise to a hybrid practice. The first mechanism involved the renaming of a practice – ‘functional economy’ versus ‘servitization’. Once the discourses used this new name, the practice reached new actors in the organizational field, who seized it for complementary theorization according to additional institutional logics. The second mechanism is the pivotal role of environmental protection institutional logic. The environmental protection reframing of servitization displayed in discourse not only enriched the initial meaning of servitization but also brought together business and social welfare aspects within the theorization of the practice. As a result, servitization became hybrid, further encoded by three institutional logics, two of which were initially in conflict with each other.
Discussion and conclusion
This section first proposes a model describing how discourses enable the hybridization of practice at an organizational field level. Second, this model’s theoretical and managerial contributions are highlighted and discussed. Third, the limitations of this work are detailed to outline areas for future research.
A discursive model for the hybridization of practice
From the findings, I inductively theorized a model detailing how institutional logics, discourse, and theorization interact to produce a hybrid practice. This model is fully grounded at an organizational field level. At this level, hybridization goes back and forth between the institutional (i.e., symbolic) and action-related (i.e., theorization) realms (Barley & Tolbert, 1997). Figure 2 depicts this model as having three phases.
Figure 2. Model of the hybridization of practice through discourse in an organizational field
The first phase concerns the hybridization trigger. It includes the renaming of a non-hybrid practice as a key discursive hybridization mechanism. This phase starts with a candidate practice for hybridization. Previously, the theorization of this practice was underpinned by a single institutional logic. Discourses start intervening at this stage. They spread the renaming of this non-hybrid practice across the organizational field. The renaming of this practice – ‘servitization’ versus ‘functional economy’ – functions as a hybridization trigger. From this point on, the practice gradually ceases to be exclusively embedded in its ‘home’ logic. Through renaming, its initial theorization is preserved but unlatched, as new spaces open up for theorization. The practice becomes available for multi-institutional logic theorization.
The second phase relates to the hybridization proceedings. It shows discourses bringing into play a pivotal institutional logic. This pivotal role is the second key mechanism. The pivotal institutional logic (environmental protection) integrates the preceding one to expand theorization for the first time. Not one but two goals start being pursued concomitantly. An additional frame/justification duo ascribed to the practice appears and is superimposed on the primary (economic) one. A synergistic meaning comprising two or more mutually reinforcing interrelated components emerges. The legitimacy of the practice increases. Then, through discourses, the newly theorized practice is brought to a third institutional logic, which was originally in conflict with the first one. However, since the pivotal institutional logic is compatible with the third one, the goal advocated by the former can now be approached by the latter. The practice expands to form a new frame/justification, giving rise to a new complementary theorization component. The same stages are repeated. The practice becomes hybrid, and its legitimacy is rooted in three institutional logics, two of which are in natural conflict with each other.
The third phase concerns the completion of hybridization. Throughout this phase, discourses convey the nascent hybrid practice, which will be theorized exclusively according to the third logic. Through discourses and under the effect of the practice’s renaming and the pivotal institutional logic, the practice receives the attention of actors embedded in this third institutional logic. The final step of the incremental theorizations follows as a new complementary goal is assigned to the practice. Subsequently, a new frame/justification duo is integrated into the previous components of its theorization. As a whole, the resulting hybrid practice offers integrated aspects legitimized by multiple institutional logics. Thus, the pivotal institutional logic not only integrates itself into other institutional logics that operate independently but also has the capacity to bring them together into a fully integrated theorization. This multi-logic integrated theorization generates a meaning strong enough to gain support from new and heterogeneous actors. The practice’s meaning is revisited and enriched by comparison with the original one. Social approval expands, and the hybrid practice spreads further in the organizational field.
In summary, this model proposes a discursive approach to the hybridization of practice. It shows the properties of discourses to seize localized practices and submit them to several institutional logics materialized through theorization, which allows these practices to be promoted throughout all the components of an organizational field. Specifically, discourses enable two hybridization mechanisms to operate: practice renaming and the pivotal role of an institutional logic. As such, this model offers several contributions to the institutional theory literature, as well as insights for decision-makers and managers.
Theoretical contributions and managerial implications
This work proposes a discursive approach to the hybridization of practice. It advances a model that shows how discourses catalyze the reaction of an existing non-hybrid practice and additional institutional logics through theorization activities in an organizational field. Such a model acknowledges the dual nature of institutional logics, which comprise symbolic and material dimensions: organizing values and associated practices, respectively (Friedland & Alford, 1991; Thornton et al., 2012). It also resonates with a sequential view of institutionalization in line with prior institutional works (Barley & Tolbert, 1997).
This model enriches the hybrid organizing literature by first offering an additional point of focus to study the mechanisms of the hybridization of practice. While prior research has placed such mechanisms inside organizations (for reviews, see Battilana et al., 2017; Battilana & Lee, 2014), this research revealed mechanisms that unfold in an organizational field. This insight is valuable given the severe tensions inside organizations when it comes to creating and sustaining hybrid practices (Battilana, 2018; Pache & Santos, 2010; Smith et al., 2013). In this respect, the archetypical hybrid practices produced by an organizational field can be leveraged as a common starting point to ease such tensions. Organizational field hybridization mechanisms are also likely to be underpinned by more than two logics, making the most of institutional pluralism to produce original – hybrid – business models and practices (Ocasio & Radoynovska, 2016). As suggested by Battilana and colleagues (2012) and demonstrated in this article, such mechanisms are likely to reconcile business goals with environmental protection and social goals.
This research contributes in another way by linking discourses with the hybrid organizing literature. In doing so, it reveals two new mechanisms that facilitate the hybridization of practice: practice renaming and the pivotal role of institutional logic. Practice renaming appears to be a trigger for the hybridization of practice. This brings to the fore the role of words and vocabularies in this hybridization. This role is well known in the establishment of new institutional logics (e.g., Loewenstein et al., 2012; Reay & Jones, 2016) or in institutional maintenance (e.g., Blanc & Huault, 2018). However, to the best of my knowledge, no other work has previously identified the capacity of words to be door openers for the hybridization of practice.
This aspect supports and extends the idea that naming shapes legitimacy in a singular way (Green & Li, 2011). The words used to designate a practice block its conceptual baggage, that is, the collective mental representations it conveys (McConnell-Ginet, 2008). In this sense, a particular word or vocabulary ‘not only imposes a particular frame, it hinders later re-framing, because for the latter you are starting with a biased sample of information’ (Loewenstein & Ocasio, 2005, p. 28). Dropping the term ‘servitization’ unlatched the conceptual baggage of the designated practice and, thus, enabled additional reframing. Moreover, renaming this practice with a vague term like ‘functional economy’ avoided the practice being subject to bias when conveyed by discourses to other actors of the organizational field. Vagueness deprives the practice of any connotation. It operates as a discursive resource (Krieg-Planque, 2012; McConnell-Ginet, 2008). In this research, such a resource was leveraged to favor dis-embeddedness: renaming a practice with vague terms opened up its framing to additional elements from additional institutional logics.
The second mechanism enabled by discourses described in this research is the pivotal role played by an institutional logic in the hybridization of practice. Prior research has shed light on how some institutional logics moderate the way organizations respond to another one (Greenwood et al., 2010), or how some institutional logics steer the influence of other logics to settle practices in a specific way (Lee & Lounsbury, 2015). Yet, to the best of my knowledge, research has previously been silent on how an institutional logic can bring two other conflicting logics together in the theorization of a practice to produce this hybrid. In this research, this pivotal role was possible due to the overarching and adaptable character of the environmental protection logic. Its overarching character enabled the creation of a meta-goal, already observed in the institutional literature (Huxham & Vangen, 1996), which, once conveyed by discourses, was superimposed on the specific goals of every actor in the field. Furthermore, its adaptable character acts by ‘framing the frames’ provided by the other conflicting institutional logics. As such, the environmental protection logic brought together the servitized and social welfare ones. Through discourses, it enabled the connection of servitization to multiple systems of values as many legitimacy vectors drawn from theorization (Abbott, 1988; Greenwood et al., 2002). In the course of this theorization, servitization became hybridized as it benefited from increased legitimacy.
Consequently, this article contributes to the literature by representing discourses as a social space of the hybridization of practice, situated at the organizational field level and functioning autonomously while complementing the organization. Also, the higher number of institutional logics likely to traverse this social space favors a reconciliation between social businesses research (Battilana & Lee, 2014) and research dealing with ecological entrepreneurship (Haigh & Hoffman, 2014; York et al., 2016b). Last but not least, even though this article explores discourses only at the organizational field level, discourses operate within organizations too (Phillips & Oswick, 2012), and their hybridization properties will likely remain valid inside organizations.
Finally, this work contains managerial implications. First, it helps define the meaning that is given to servitization and the functional economy. Both signal an expansion of the service realm over the industry realm. Yet, servitization differs from the functional economy in that it is limited to business matters. The functional economy preserves the servitization business principle while conditioning the legitimacy of this principle on achieving environmental protection and social welfare gains. This confirms what has been described in the product–service system and functional economy literatures (Boehm & Thomas, 2013; Stahel, 2010, 2016) but has been absent from the servitization literature (Lightfoot et al., 2013). This point is also important for firms willing to launch projects, especially with public actors or exposure to public opinion. In addition, with regard to long-term effects, this research gives decision-makers insights into how to reframe and link existing practices to sustainable development principles.
Limitations and future avenues for research
The approach and the method of this work had several limitations. These limitations relate to the agency and power of the actors involved, the link between discourses and practices, and the non-discursive aspects of the studied practice.
First, the conceptual and methodological approach of this research did not account for the agency and power of the actors involved in the theorization of servitization as a hybrid practice. The question remains of who did what on purpose to sustain this theorization. The promoters and detractors of this theorization, as well as the way in which they engaged in discursive strategies and actions, could have been examined in more detail. The rhetorical dimensions of institutional work have already received widespread attention in the institutional literature (Lawrence et al., 2009). Suddaby and Greenwood (2005), for instance, focus on the relationship between rhetoric, institutional vocabularies, and theorization to enact new institutional arrangements across multinational audit firms. Although this part of the institutional literature focuses on confrontation and struggle rather than complementarity and integration, it might be fruitful to consider how it might contribute to research on the hybridization of practice. Also, this point particularly questions the capacity of organizational field’s actors to seize field configuring events as ‘dubbing’ ceremonies to make the new name of a practice candidate for hybridization official (McConnell-Ginet, 2008; Nigam & Ocasio, 2010).
Second, this work does not account for the motivations and modalities of the effective implementation of servitization as a hybrid practice. The extent to which ground actors effectively pursue environmental and social goals was not addressed. Hence, the question of how archetypical hybrid practices provided by the field are adapted and adopted within organizations still has to be explored. Specifically, do servitized companies adopt greenwashing or social-washing decoupling strategies (Meyer & Rowan, 1977)? And are ecological and social dimensions effectively integrated into decision-making and implementation processes? If yes, is there a defined order of priority? These questions refer to the strategies, beyond hybridization, that organizations deploy in complex institutional environments: acquiescence, compromise, avoidance, distrust, and manipulation (Oliver, 1991). Future research should concentrate on these strategies and how they could be linked to the attributes of organizations (e.g., position in the field, governance, and identity) and the characteristics of the field where they are deployed (Greenwood et al., 2011).
Third, this work did not conceptualize the intrinsic but non-discursive characteristics of candidate practices for hybridization through additional theorization. This conceptualization would make it possible to identify series of practices to link to sustainable development goals. In the present case, the immaterial dimension of servitization probably played a role in its reframing as a hybrid practice. This immaterial dimension must have contributed to the perception of its potential to serve environmental protection purposes, while this practice primarily belonged to business spheres. This means questioning the potential of certain practices to be leveraged as boundary objects (Leigh Star, 2010), which, beyond discourses and due to proper characteristics, can bring actors from different horizons together.
This work also shed light on the role played by discourse in the hybridization of practice. In so doing, it uncovered original mechanisms operating at an organizational field level. The proposed model indicates that hybridization occurs through the interaction of institutional logics, discourses, and theorization. It highlighted the role of practice renaming and the pivotal properties of institutional logic and revealed how the protection of the natural environment can be used as a discursive common ground to realign social and commercial goals within hybrid practices. Owing to the urgent call to renew economic systems in the sense of preserving the natural environment and social equity, it will become increasingly necessary to develop knowledge in this domain.
Acknowledgments
The author would like to express his gratitude to the editor, the three anonymous reviewers, and his thesis supervisors, Florent Noël and Stéphane Saussier. This work has greatly improved due to their input. The author also warmly thanks the French Foundation for Management Education (FNEGE) for its financial support and the managers and professors of the CEFAG program for their valuable assistance.
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