The Coordinating Mechanisms of Institutional Decoupling, Assimilation, and Blending in State-Led Markets: The Case of Social Enterprises

Social entrepreneurial organizations have been defined as those innovative organizations that create social change through engaging in a process of institutional entrepreneurship, and hence change institutional logics. However, this paper argues that emerging markets are characterized by distinct state logics that affect social enterprises’ strategies. On the one hand, in the face of legal logics, incumbent social entrepreneurial organizations go into a process of conformity, compromise, and bargaining through mechanisms of replacement, blending, and assimilation of state logics. On the other hand, in the context of state informal compulsory power, incumbent social entrepreneurial organizations implement the decoupling mechanism, in addition to series of blending and assimilation mechanisms. This research contributes to our understanding of the mechanisms by which the state forces change to the institutional logics of social entrepreneurial organizations, and how these organizations move from a notion of implementing social change through their own vision to instigating state agendas, and hence causing mission drift toward state logics. Also, this paper highlights the notion of the coordinating mechanism of decoupling, blending, and assimilation as an innovative organization instrument to decrease mission drift.