The U-shaped Effect of Logic Multiplicity on Organizational Performance: Evidence from the US Health Care Industry
In this paper we investigate the relationship between logic multiplicity and organizational performance. While acknowledging the importance of logics’ nature and controlling for it, we hypothesize that logics impact performance in view of their sheer number. We argue that, while an initial increase in the number of logics jeopardizes organizational performance, a further increase in logic multiplicity prompts an exponential rise in the possibilities for innovative recombination of logic components, thus producing positive effects and eventually tracing a U-shaped relationship with organizational performance. We further suggest that the logic incorporated in an organization’s legal form can be a “catalyst” in easing the recombination of logics, in this way positively moderating the impact of multiple logics on performance.
Our empirical evidence from a panel data for 336 California general acute care hospitals confirms our hypotheses. We contribute to literature on institutional logics, logic multiplicity and hybrid organizations, and also provides useful implications for managers in the health care industry.