Description
We study how mid-tier accounting firms deal with changes in their institutional environment
that resulted in a shift in emphasis from the trustee logic to the commercial logic. We
find that these mid-tier firms selectively adopt practices related to the commercial logic,
while retaining a principal commitment to the trustee logic. Interviews with high level
informants in these firms show how specific strategic choice opportunities serve as independent
critical events framing practice-adoption decisions. Main strategic issues for the
mid-tier firms relate to the changing role of the accountant and changes in organizational
structure and practices. As these issues fundamentally challenge characteristics of their
professional identity, there is internal resistance against this transformation. Nonpartnered
accountants mainly challenge new roles that upset their extant work routines,
whereas partners resist changes affecting their autonomy. These types of resistance
directly impact the strategic organizational responses of the accounting firms to institutional
pressures.
Committed to professionalism: Organizational responses of mid-tier
accounting ?rms to con?icting institutional logics
Michel W. Lander
a,?
, Bas A.S. Koene
b
, Shelly N. Linssen
b,1
a
HEC Paris, 1, Rue de la libération, 78351 Jouy-en-Josas, France
b
Rotterdam School of Management Erasmus University, Burgemeester Oudlaan 50, 3062 PA Rotterdam, The Netherlands
a b s t r a c t
We study how mid-tier accounting ?rms deal with changes in their institutional environ-
ment that resulted in a shift in emphasis from the trustee logic to the commercial logic. We
?nd that these mid-tier ?rms selectively adopt practices related to the commercial logic,
while retaining a principal commitment to the trustee logic. Interviews with high level
informants in these ?rms show how speci?c strategic choice opportunities serve as inde-
pendent critical events framing practice-adoption decisions. Main strategic issues for the
mid-tier ?rms relate to the changing role of the accountant and changes in organizational
structure and practices. As these issues fundamentally challenge characteristics of their
professional identity, there is internal resistance against this transformation. Non-
partnered accountants mainly challenge new roles that upset their extant work routines,
whereas partners resist changes affecting their autonomy. These types of resistance
directly impact the strategic organizational responses of the accounting ?rms to institu-
tional pressures.
Ó 2012 Elsevier Ltd. All rights reserved.
Introduction
Over the past two decades the accounting profession
has come under increasing institutional pressure. Financial
globalization (Arnold, 2009) along with technical innova-
tions (Brock, 2006) and a broad shift towards neo-liberal
principles of market economics (Puxty, Wilmott, Cooper,
& Lowe, 1987) are changing the face of accounting. In re-
sponse, the accounting profession is changing with a lead-
ing role for the largest, multinational accounting ?rms
(Cooper & Robson, 2006) that have created a distinct trans-
national ?eld (Suddaby, Cooper, & Greenwood, 2007). The
big 4 ?rms developed a new, commercial business model
for their operations (Greenwood & Suddaby, 2006)
re?ected in their attitudes in the regulatory arena (e.g.
Cooper & Robson, 2006; Suddaby & Greenwood, 2005)
but also in the management of their professionals
(Covaleski, Dirsmith, Heian, & Samuel, 1998; Hanlon,
1996; Kornberger, Justesen, & Mouritsen, 2011).
For other (smaller) actors this has created a professional
?eld full of tension between the traditionally dominant
trustee – or ?duciary – logic and an increasingly pervasive
commercial – or corporate – logic (Dezalay, 1995; Hanlon,
1996; Thornton, Jones, & Kury, 2005). In prior studies of
processes of institutional change, scholars have pointed
to the importance of institutional tension based in the
incompatibility of competing institutional logics (Seo &
Creed, 2002; Thornton & Ocasio, 2008; Thornton et al.,
2005). Institutional logics re?ect the socially constructed
basis of ‘‘historical patterns of material practices, assump-
tions, values and beliefs, and rules by which individuals
produce and reproduce their material subsistence, orga-
nize time and space, and provide meaning to their social
reality’’ (Thornton & Ocasio, 1999, p. 804). They shape
how organizations and individuals behave and thereby af-
0361-3682/$ - see front matter Ó 2012 Elsevier Ltd. All rights reserved.http://dx.doi.org/10.1016/j.aos.2012.11.001
?
Corresponding author. Tel.: +33 1 39 67 97 08; fax: +33 1 39 67 70 88.
E-mail addresses: [email protected] (M.W. Lander), [email protected] (B.A.S.
Koene).
1
Consultant.
Accounting, Organizations and Society 38 (2013) 130–148
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fect organizational structures and processes (Greenwood,
Diaz, Li, & Lorente, 2009). While logics are fundamental
and in?uential, organizational ?elds are rarely subject to
a single dominant logic. Rather, ?rms have to contend with
multiple, often contradicting logics that affect institutional
stability and change (c.f. Lounsbury, 2007; Marquis &
Lounsbury, 2007; Purdy & Gray, 2009; Reay & Hinings,
2005; Thornton, Jones, & Kury, 2005). The institutional log-
ics perspective thus moves beyond the basic constraining
nature of single logics, highlighting the ‘‘partial autonomy
of actors from social structure’’ (Thornton, Ocasio, &
Lounsbury, 2012, p. 7).
Following Lounsbury’s (2008, p. 354) lead we look at
how the recognition of ‘‘multiple logics, and thus multiple
forms of institutionally-based rationality . . .can provide
new insight into practice variation and the dynamics of
practice.’’ We do this through the documentation and anal-
ysis of the heterogeneity of organizational responses of
mid-tier accounting ?rms to the institutional pressures
facing the accounting industry. Where most studies exam-
ining institutional change focus on elite actors (Greenwood
& Suddaby, 2006) or mavericks (Leblebici, Salancik, Copay,
& King, 1991), the core of an organizational ?eld consists of
mainstream ?rms. The number of studies examining
change within this group has remained limited (Hardy &
Maguire, 2008). While studying the transformation of the
largest accounting ?rms into Managed Professional Busi-
nesses (MPBs; Cooper, Hinings, Greenwood, & Brown,
1996), Greenwood, Suddaby, and Hinings (2002) noted
that the regional and local ?rms in their study only had
modest sympathy for this new structure and were largely
indifferent to what these ?rms where doing. To some ex-
tent, the mid-sized ?rms de?ne themselves by how they
are different from the big 4. One of our respondents de-
scribed it as: ‘‘Saying that we want to look like the big 4 is like
swearing in a church!’’ (A3). We investigate the strategic re-
sponses (Oliver, 1991) displayed by mid-tier accountancy
?rms in the Netherlands in the face of con?icting demands
of the trustee and commercial logic.
These mid-tier ?rms present an interesting sample for
three reasons. First, although still quite large in size (both
in terms of employees and revenues), they are more
embedded in their local national institutional context (Ra-
mirez, 2009). They are, for example, more dependent on
national associations as sites of professionalization than
large professional ?rms that develop and provide much
of their training in-house (Cooper & Robson, 2006; Ramir-
ez, 2009). Second, our mid-tier organizations tend to
serve smaller, more local clients than the big 4. Hence,
they face different client demands (Ramirez, 2009). Third,
non-partnered professionals still have a great deal of
in?uence on the day-to-day operations of our mid-tier
?rms, given the relatively small size of the professional
cadre and the relatively easy access to the strategic apex
of the ?rm. Still, the increased importance of the commer-
cial logic has created a situation where the con?icting de-
mands of the commercial and the trustee logic ‘‘create
ambiguity and the concomitant need for sensemaking
about the implications of logic changes’’ (Thornton
et al., 2012, p. 7) also for our mid-tier ?rms. When exter-
nal expectations regarding con?icting logics are unclear
there is room for managerial discretion (DiMaggio,
1988; Oliver, 1991). It is therefore unlikely that strategic
responses to con?icting logics will be similar across all
actors populating an organizational ?eld (Pache & Santos,
2010). Given the relative paucity of empirical research on
the topic (Thornton et al., 2012), we investigate how our
mid-tier accounting ?rms deal with the two logics avail-
able for sensemaking and legitimation of choices regard-
ing the future course of their activities.
Besides the relevance to institutional theory, an analy-
sis of mid-tier ?rms also further illuminates our under-
standing of the evolution of professions. Essentially
sociological literature identi?es professions as occupa-
tions with special power and prestige, which were
granted a privileged position because they ful?lled spe-
ci?c societal needs and maintained norms through the
application of specialized bodies of knowledge and be-
cause they were ‘‘devoted to the service of the public,
above and beyond material incentives’’ (Larsson, 1977,
p. x). While institutional scholars in general do not ques-
tion the original ethical values espoused by the profes-
sions, authors in the sociology of professions literature
are much more skeptical, and some even question if this
focus ever really existed (cf. Abbott, 1988; Haskell,
1984; Larsson, 1977; Reed, 1996). Larsson (1977) for in-
stance argued that professionalization is mainly a process
of creating scarcity of resources in order to control the
market for expertise. In a related argument Abbott
(1988) saw professionalization as a way to create a
monopoly for skills and services. This critique of profes-
sional self-regulation overly driven by economics is simi-
larly heard in discussions about the consequences of the
development of large ?rms into more commercially ori-
ented ?rms (Wyatt, 2003). Discussing the tension be-
tween economic and professional motivation, Freidson
argues that although a shifting focus to pro?t is in itself
not unethical, the maximization of pro?t is (Freidson,
2001). According to Greenwood (2007) the original bal-
ance may have been disturbed to the detriment of profes-
sional behavior.
By exploring the ways in which the mid-tier accounting
?rms deal with the tensions between the traditionally
dominant trustee logic and the commercial logic, we make
three contributions. In relation to our understanding of the
professions, insight into the sources and motives for resis-
tance to certain structures and processes associated with
the commercial logic forms our ?rst contribution. While
our study is certainly not the ?rst to investigate resistance
to commercial practices in accounting ?rms (Covaleski
et al., 1998; Dirsmith & Covaleski, 1985; Hinings, Brown,
& Greenwood, 1991; Kornberger, Carter, & Ross-Smith,
2010), we do ?nd different motives underlying this resis-
tance in this group of ?rms. In part, we observe a frag-
mented and pragmatic implementation of elements of
the new logic as mid-tier ?rms select only those elements
that have the perceived potential to resolve concrete man-
agerial challenges regarding speci?c strategic issues. The
trustee logic thus continues to exercise its effect through
the embedded action of (managing) partners as well as
non-partnered accountants, whom are unwilling to forgo
their professional traditions and norms, because of their
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 131
vested interests, but also in order to maintain professional
standards in the client’s interests.
Second, we contribute to the literature on institutional
logics and change. Fundamental changes in environmental
conditions lead to organizational change (Romanelli &
Tushman, 1994). Within the accountancy sector, changes
such as increased regulation, automation of services and
changing client demands have recently punctuated a long
period of stability. These signi?cant environmental jolts
(Meyer, 1982) are hypothesized in prior literature to result
in revolutionary transformations of organizations rather
than their evolutionary development (Greenwood &
Hinings, 1996; Romanelli & Tushman, 1994; Tushman &
Romanelli, 1985). Yet, this is not what we observe in our
group of mid-tier ?rms. Our work on the micro-level
shows co-existence of old and new values and beliefs
(Brock, Powell, & Hinings, 2007) in the early phases of
institutional change in this segment of the accounting
industry. The mid-tier ?rms respond by addressing sepa-
rate and speci?c strategic and structural issues, as invoked
by the new logic. In their response they do not necessarily
draw on the new commercial logic, but on elements of the
logic that, for them, is most applicable to the situation at
hand. As such we ?nd a process of blending experimenta-
tion
2
where actors use ?eld logics as institutional toolkits,
a ?nding that bears close resemblance to Swidler’s ‘‘cultural
toolkit’’ argument (Swidler, 1986) and Thornton’s logics per-
spective where actors balance elements of multiple logics to
?t the particularities of a speci?c situation (Thornton, 2004).
Our work therefore offers insights in the early stages of the
organizational sedimentation process (Cooper et al., 1996)
related to ?eld level institutional change, rather than evi-
dence of a comprehensive transformational embrace or out-
right rejection of the structures and processes associated
with the novel commercial logic.
Our third contribution is to the literature on Profes-
sional Service Firms (PSFs) as we address the issue of gen-
eralizability of extant ?ndings to other (segments of)
professional ?elds (Von Norden?ycht, 2010). While
acknowledging that the big 4 have a profound in?uence
on the accounting profession and its regulation (Cooper &
Robson, 2006), the change in institutional logics and asso-
ciated practices (Greenwood & Suddaby, 2006) in these
?rms cannot straightforwardly be extrapolated to the
other actors in the accounting industry. While the big 4
?rms are dealing with multinational clients in a supra-
national arena, our mid-tier ?rms are well-established in
their national setting, engaging primarily with local clients
and experiencing greater in?uence of national professional
organizations (Ramirez, 2009). Our ?ndings indicate that
the commitment to the traditional trustee logic is consid-
erably stronger within this group of more locally grounded
?rms. Thus, Greenwood and Suddaby’s (2006) ?nding that
a group of elite ?rms pushes a comprehensive and consis-
tent agenda propagating the commercial logic does not
translate to the group of mid-tier ?rms. This suggests that
organizational responses to con?icting or changing logics
may differ systematically across the different demographic
strata into which organizational ?elds tend to be seg-
mented (Ramirez, 2001).
Theoretical orientation
Shifting institutional logics
The accounting industry has always faced contradicting
expectations from a professional and a commercial logic.
Yet traditionally the professional trustee logic (Suddaby
& Greenwood, 2005) in which professional values and a
feeling of societal guardianship is central to the profes-
sional identity was dominant. Professional audit practices
are the core of the accountants’ activities and as these
activities mean applying an esoteric body of knowledge
to complex problems, they enjoy high levels of discretion
and autonomy (Greenwood, Hinings, & Brown, 1990).
Additionally, senior members, who typically own and
manage the ?rms, are responsible for their particular prac-
tice areas and hence place priority hereon. In practice this
means that the strategy of the ?rm can be described as the
aggregate of the partners’ individual interests (Pinnington
& Morris, 2003). In terms of organizational systems and
practices, these ?rms rely primarily on informal and colle-
gial control mechanisms at the expense of more formal and
hierarchical systems (Greenwood et al., 1990).
However, recently the accounting industry experienced
a number of upheavals that challenge traditional profes-
sional practice and the centrality of the trustee logic. First,
computer aided audit systems have reduced the complex-
ity and labor intensity of the audit process (Brock, 2006). In
the Netherlands, the introduction of a standardized soft-
ware language XBRL results in increased ef?ciency and
ultimately less billable hours in the consolidation practice
(ING Economic Bureau, 2010). On the client side, the in-
creased emphasis on costs and the internet and mobile
technologies that allow for shopping around, adds to the
pressure on audit fees (Ahroni, 1999). Second, due to glob-
alization, accountancy organizations now have to deal with
international standards and needs of their international
clients (Nachum, 1996). This brings new knowledge
requirements for accountants and challenges in the local
integration of global standards (Botzem & Quack, 2009).
Third, statutory protection for providing services has been
reduced or removed (Hart, Schlesinger, & Maher, 1992).
This results in growing intra- and inter-professional com-
petition (Gray, 1999). Fourth, the Sarbanes-Oxley act has
also induced changes in the organizational structure of
accounting ?rms (Greenwood & Suddaby, 2006), increas-
ing organizational process controls and reducing the
importance of the individual accountant. In the Nether-
lands, for those ?rms that perform statutory audits of an-
nual and consolidated accounts, the Wet toezicht
accountantsorganisaties (Wta; law on the supervision of
accounting ?rms), has been implemented. This law entails
that accountancy ?rms require permits for statutory
audits, the allocation of which is determined by a number
of stringent quality demands. This has led to a decrease in
the number of ?rms allowed to conduct audits. The Wta
has created a large barrier of entry as the costs of these
2
This termed was suggested by one of our reviewers.
132 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
permits are signi?cant. There are the direct costs of obtain-
ing and maintaining this permit as well as indirect costs
stemming from the investments ?rms have to make in
their quality systems (ING, 2010). Finally, ?rms face
changes in client demands. Clients are not only more crit-
ical towards the service they receive, but also demand
more and different services, i.e. full service advice (ING,
2010). As such, the role of the traditional accountant is
slowly being shifted towards that of an advisor to the ?rm
(Ramirez, 2009).
The accounting profession at crossroads
These developments shift the control over professionals
from the professionals to market competition and hierar-
chical control through management in organizations (Han-
lon, 1996, 1997). This directly weakens the effects of social
closure and economic monopoly, two important historical
foundations for maintaining the professions. Social closure
is the process by which jurisdictional boundaries are
drawn around a particular set of knowledge and skills to
make it possible for a profession to ensure quality and
competence by providing special educational credentials.
Economic monopoly both ensures the quality of the profes-
sion as well as the discipline of its members by muting
competition (Freidson, 2001). Related, economic monopoly
ensures the development and maintenance of quality be-
cause it allows the professions, for instance, to set tariffs
and entry barriers and prohibit advertising (Freidson,
1984; Suddaby et al., 2007). While the accounting industry
has always faced con?icting demands from the profes-
sional and the commercial logic, the aforementioned
changes pushed accounting ?rms to rationalize their ser-
vice delivery process replacing the traditional partnership
form by the MPB form (Cooper et al., 1996), which empha-
sizes the ef?ciency of structures and processes. Addition-
ally the large accounting ?rms broadened their activities
to consultancy services (Greenwood & Suddaby, 2006).
This has led them to forego their professional indepen-
dence (Covaleski, Dirsmith, & Rittenberg, 2003) and an
emphasis on the application of expertise in the interest
of public service (Pinnington & Morris, 2003) for the con-
cept of value added (Covaleski et al., 2003; Pinnington &
Morris, 2003). Following the shift to a more commercial lo-
gic the large accounting ?rms also developed more deliber-
ate management practices. To assure ef?ciency and avoid
strategic drift (Lorsch & Tierney, 2002) the large account-
ing ?rms introduced formal strategic planning and gover-
nance, emphasized marketing and work with centralized
?nancial systems (Morris & Pinnington, 1998).
Institutional dynamics and strategic responses
Changing institutional demands naturally result in a
changed organizational ?eld. On the ?eld level, the litera-
ture on institutional logics shows four possible outcomes
of the clash between logics: the incorporation of elements
of a new logic into the dominant one (e.g. Glynn, 2000), the
hybridization of elements of both the old and new logic
(e.g. Colyvas & Powell, 2006; D’Aunno, Sutton, & Price,
1991; Purdy & Gray, 2009), a shift from the old dominant
logic to the newly introduced logic (e.g. Thornton, 2002;
Zilber, 2002) or the permanent co-existence of both logics
(e.g. Lounsbury, 2007; Marquis & Lounsbury, 2007; Reay &
Hinings, 2005, 2009; Scott, Ruef, Mendel, & Caronna, 2000).
While in these studies the effects on the macro-level are
evident, the processes by which micro-level dynamics lead
to these outcomes are rarely investigated. Oliver (1991, p.
145) points to the lack of ‘‘attention to the strategic behav-
iors that organizations employ in direct response to the
institutional processes that affect them.’’ Drawing on insti-
tutional and resource dependence theory she describes
how organizations within the ?eld react and behave. To
cope with institutional demands ?rms can employ ?ve dif-
ferent strategic responses: (1) acquiescence, organizations
accede to institutional pressures; (2) compromise, organi-
zations seek a balance to manage inconsistencies between
institutional expectations and organizational objectives;
(3) avoidance, organizations try to preclude the necessity
of conformity; (4) de?ance, organizations actively resist
institutional expectations; and (5) manipulation, organiza-
tions actively try to rede?ne the institutional expectations.
Following the publication of this seminal work, a produc-
tive research stream developed to uncover which strategic
responses are employed by ?rms in various settings.
However, in most studies, authors discuss ?rm re-
sponses to changes in speci?c institutional practices rather
than wholesale shifts between logics. Additionally, the
possible responses of these ?rms are generally limited to
acquiescence/adopt or de?ance/non-adopt of a speci?c
practice. For example, adoption or resistance has been
investigated for cesarean surgeries (Goodrick & Salancik,
1996), university recycling programs (Lounsbury, 2001),
divisionalization (Thornton, 2002), issue management
practices (Greening & Gray, 1994), work family issues
(Milliken, Martins, & Morgan, 1998), and TQM systems
(Westphal, Gulati, & Shortell, 1997). In a signi?cantly smal-
ler set of studies, authors went beyond the dichotomy of
adoption/non-adoption and directly investigated all ?ve
strategic responses, however again these studies focused
on single practices, rather than broader shifts in logic
(e.g. Goodstein, 1994; Ingram & Simons, 1995).
Several in-depth case studies look at ?eld level changes
in institutional logics, but in these studies the simultaneity
and congruence of strategic responses by ?rms are
implicitly assumed rather than formally investigated (e.g.
Hoffman, 1999; Townley, 2002). Thornton et al. advocate
further study of the effects of macro-level logics on the mi-
cro-dynamics arguing the simultaneous existence of multi-
ple institutional logics and addressing the need to further
investigate how logics relate to changes in identities and
practices (Thornton et al., 2012).
A review of accounting research points to a similar lack
where research on ‘‘practice’’ development has been extre-
mely fruitful but ‘‘has tended to ignore broader institu-
tional dynamics in favor of more micro-processual
studies of how accounting systems shape and are shaped
by intra-organizational dynamics’’ (Lounsbury, 2008, p.
356). For example, studies of large accounting ?rms show
the importance of the new role of managers for the
advancement of the commercial logic. Kornberger et al.
(2011) point out howin these ?rms the role of the manager
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 133
serves as a ‘rite of passage’ in the corporate career where
individuals learn to navigate a complex network of multi-
ple players in a new role connected to the ongoing ratio-
nalization and economization of the ?rm. In similar vein,
Covaleski et al. (1998) as well as Dirsmith et al. (1997)
highlight how management by objectives threatens the
core professional characteristics of autonomy and partner
discretion and how they subsequently subvert, transform
and bend the practice.
While investigating such speci?c practices is important
as they invariably alter professional identity, we are inter-
ested how mid-tier ?rms adapt their whole portfolio of
structure and processes in view of the growing importance
of the commercial logic. Besides documenting the organi-
zational responses of mid-tier accounting ?rms, we are fur-
ther interested in their underlying rationale for the
demonstrated strategies. In previous studies authors show
that encroachment on professional autonomy has been a
strong driver for resistance against novel practices. They
also show that organizational members differ in their opin-
ions with regard to these practices (Covaleski et al., 1998;
Dirsmith et al., 1997; Hinings et al., 1991). Recently, Pache
and Santos (2010) have argued that the type of strategic re-
sponse given by ?rms is not solely determined by external
forces but rather by the internal representation of these
external forces. Their study highlights the importance of
perceptions of the existing internal audiences of the rele-
vant external forces and the logics by which they operate
(Friedland & Alford, 1991). We further investigate this
diversity in opinions by evaluating how attitudes towards
strategic responses differ between partnered and non-
partnered accountants in our mid-tier accounting ?rms.
In this study we thus investigate how mid-tier account-
ing ?rms deal with the multiple, con?icting logics available
for identity formation and practice development in their
?eld of accounting practice. We speci?cally address how
intra-organizational representation of these logics takes
shape and affects ?rms’ responses to the main strategic
challenges in the ?eld.
Methods
Rationale
The aim of this research is to elaborate our current the-
oretical understanding (Lee, Mitchell, & Sablynski, 1999) of
the impact of multiple institutional logics and the hetero-
geneity of organizational responses. Similar to Greenwood
and Suddaby (2006) we use inductive reasoning to map
organizational responses to institutional pressures as per-
ceived in the demographic of mid-tier accounting ?rms.
In order to document ‘‘changes in structures and systems’’
and ‘‘the ways in which these changes coincide with insti-
tutional templates’’ large scale comparative studies are
necessary (Greenwood & Hinings, 1996, p. 1047). They
are necessary as changes involve dif?cult to measure con-
cepts (e.g. resistance) and radical changes take lengthy
periods of time. Hence we opted for a qualitative, multiple
case study (Eisenhardt, 1989) and use event sequencing of
historical and contemporary processes (Lee et al., 1999)
within and between cases. In order to disentangle the pro-
cess of organizational change we draw on interview and
archival data.
Research context: The Dutch accountancy sector
The accountancy ?rms included in the sample are
drawn fromthe 22 largest accountancy ?rms listed directly
behind the big 4 ?rms. In terms of size (turnover and num-
ber of full-time employees) mid-tier ?rms differ substan-
tially from the big 4 accounting ?rms. In the ranking of
largest accounting ?rms in the Netherlands the big 4 are
followed by three ?rms with pro?ts in excess of €100 mil-
lion and employing over 1000 fte. The following six ?rms
have over €50 million in pro?ts and employ over 500
employees. Finally, the remaining 13 mid-tier ?rms have
pro?ts in excess of €15 million and employ more than
150 employees (www.accountant.nl).
Data sources
We de?ne our sample geographically, which is a tried
and tested sampling method for professional organizations
whose operations are contingent on the jurisdiction in
which they are active (Greenwood & Suddaby, 2006; Ruef
& Scott, 1998) Our data was collected from 2009 to 2011,
under the jurisdiction of the Nederlandse Beroepsorganisa-
tie voor Accountants (NBA; Dutch Accounting Association).
Our primary sources of data are interviews with 34 se-
nior-level informants within 11 mid-tier accounting ?rms
in the Netherlands with turnover ranging from €17.4 to
215.7 million and 161 to 1950 employees (see Table 1).
Our informants were theoretically sampled on a number
of characteristics (Corbin & Strauss, 2008). First, the infor-
mants needed to have insight in the strategic plans of the
?rms. Preferably – and most of our informants were –
the informants needed to be (managing) partners and as
such have decision making authority. Secondly, the infor-
mants represented the different service areas of the ?rm
such as the audit branch, the consolidation branch and
the ?scal branch.
As we study con?icting institutional logics we are tap-
ping into cognitive aspects such as perceptions, thought
and interpretation. Therefore, we are at the risk of several
biases (Miller, Cardinal, & Glick, 1997). In order to mitigate
subject biases, we used multiple informants (at least three,
save for one ?rm where only the managing partner con-
tributed to the study) per ?rm. The added bene?t of using
multiple informants is that it often results in richer data
(Schwenk, 1985). In the ?rst instance, the managing part-
ner or director was contacted and informed about the
study’s objectives and asked to participate in an interview.
Subsequently, using snowball sampling (Kerlinger, 1986),
we asked the ?rst informant to specify at least two other
potential informants. The interviews ranged from one to
one and a half hour in length. We always started by asking
for background information on the ?rm as well as the
informant. Hereafter, open-ended questions were used to
elaborate on ?ve important forces for change in the
accounting industry. Open-ended questions lead to higher
accuracy in reports (Miller et al., 1997). Examples of ques-
134 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
tions are: ‘‘What are the ?ve most important changes in
the ?rm’s environment that led to changes in the mindset
of the ?rm?’’; and ‘‘Why were these changes seen as
important in the ?rm?’’ Subsequent questions were used
to uncover the effects of these forces on the strategy and/
or structure in the last 5 years within the informants’ ?rm.
Example questions are: ‘‘What were the in?uences of these
changes on organizational structures and practices?’’;
‘‘What is the best response to the changes for your ?rm
in terms of strategies, structures and practices?’’; ‘‘Why
was this response (not) chosen?’’ and; ‘‘Was there any
resistance to the changes in the ?rm?’’ All interviews were
recorded and transcribed. The total number of transcribed
pages amounted to 1400 double-spaced pages. In order to
minimize retrospective bias (Miller et al., 1997), we asked
informants to re?ect on real time and retrospective change
or non-change events. This motivated informants to tell
their story on (non-)changes in their ?rm and the substan-
tiation of accounts through instructive examples. We also
provided anonymity for both the informants as well as
the ?rms they represent to encourage openness with re-
gard to the strategic responses of the ?rms (Miller et al.,
1997). As our informants were at the heart of organiza-
tional decision making, they were exceptionally knowl-
edgeable and reliable regarding the events they were
asked to describe (Kumar, Stern, & Anderson, 1993; Seidler,
1974). Subsequently, we compared responses of the multi-
ple informants of a ?rm on these change issues. Substantial
differences between the accounts of informants of the
same ?rm would indicate retrospective biases or an unre-
liable interview protocol. In fact, we did not ?nd signi?cant
difference between the instructive examples of respon-
dents of the same ?rm (Seidler, 1974).
With this approach our 34 informants provided a suf?-
ciently rich sample, for three reasons. First, informants
were high-level ?rm members and therefore very suitable
for our objective. Second, together the studied organiza-
tions represent 50% of the mid-tier ?rms in the Nether-
lands. Third, in the ?rst three ?rms we investigated, we
interviewed four respondents. However the added value
of the last interviews, in terms of additional insights, was
limited; we felt saturation was reached. Given the above
and the fact that respondents indicated that these inter-
views meant a signi?cant time investments on their part,
we decided to limit the number of informants to three
per ?rm if data saturation was reached. At this point we
must make one caveat. Within-?rm consistency in our
informants’ answers may, in part, be the consequence of
our sampling method. While snowball sampling is a com-
mon method for obtaining informants, a possible disad-
Table 1
Informant information.
Firm/informant number Informants
A1 Turnover = € 215.7 million CEO (20 years at ?rm)
A2 National senior manager (3 years at ?rm)
A3 # FTE = 1950 Managing partner (8 years at ?rm)
A4 OOB licensed Regional managing partner (25 years at ?rm)
B1 Turnover = € 115.5 million Regional managing partner (7 years at ?rms)
B2 Managing partner audit (9 years)
B3 # FTE = 1160 Managing partner accountancy (2 years at ?rm)
OOB licensed
C1 Turnover = € 111.7 million Senior policy maker HR (5 years at ?rm)
C2 Regional managing partner (9 years at ?rm)
C3 # FTE = 1280 Director general business affairs (15 years at ?rm)
D1 Turnover = € 97.2 million National managing partner (28 years at ?rm)
D2 Regional managing partner (12 years at ?rm)
D3 # FTE = 866 Managing partner (12 years at ?rm)
D4 OOB licensed National managing partner and member of the board (21 years at ?rm)
E1 Turnover = € 68.8 million CEO (6 years at ?rm)
E2 Managing partner and member of the board (40 years at ?rm)
E3 # FTE = 756 Partner (2 year at ?rm)
F1 Turnover = € 59 million Senior relations manager (1 year at ?rm)
F2 # FTE = 636 Regional manager tax and international affairs (11 years at ?rm)
F3 Regional manager accountancy (21 years at ?rm)
G1 Turnover = € 53.5 million Managing partner and international representative (9 years at ?rm)
G2 National managing partner and member of the board (29 years at ?rm)
G3 # FTE = 465 Managing partner (18 years at ?rm)
G4 OOB licensed Managing partner (22 years at ?rm)
H1 Turnover = € 43.3 million Managing partner audit (15 years at ?rm)
H2 Managing partner accountancy (16 years at ?rm)
H3 # FTE = 476 Compliance of?cer and director of education (8 years at ?rm)
I1 Turnover = € 29.6 million Senior Manager (3 years at ?rm)
I2 Managing partner audit, member of the board (5 years at ?rm)
I3 # FTE = 293 Director Audit (13.5 years at ?rm)
J1 Turnover = € 21.3 million Managing partner (1 year at ?rm)
# FTE = 161
K1 Turnover = € 17.4 million Regional managing partner (6 years at ?rm)
K2 Regional managing partner (16 years at ?rm)
K3 # FTE = 180 Regional managing partner (3 years at ?rm)
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 135
vantage is that the principal informant will refer to like-
minded additional informants. The resulting community
bias could limit the diversity of generated responses and
ultimately wrongfully anchor organizational responses.
While we cannot rule out some level of bias we feel our
?ndings are valid ?rst, as we asked informants to describe
concrete examples of change and non-change events
which allow informants to tell their story and second we
used secondary data sources for validation of the change
events that our informants described in order to ascertain
their accuracy, and mitigate potential subject bias (Jick,
1979). Archival data on both changes in the industry and
changes within ?rms were consulted when available. We
used three different kinds of archival information. First,
we used annual reports (2008–2010) of the professional
accountancy association in order to determine key trends
as well as important legislative changes within the accoun-
tancy industry. Secondly, we perused the companies’ web-
sites to uncover any press releases (from 2008 to 2011) for
descriptions of major changes the ?rms have gone through.
Finally, we used information drawn from industry journals
(e.g. Maandblad voor Accountancy and Bedrijfseconomie
(MAB; Monthly journal on accountancy and business eco-
nomics)). Information herein was analyzed after the inter-
views were held and was used to supplement both the
information on forces for change in the ?eld, as well as
changes that were initiated by various actors in the ?eld.
These data were primarily used to corroborate the infor-
mation drawn from the interviews however at times it
was used to supplement our data.
Data analysis
The data analysis had both a planned and emergent
character. During the analysis the authors shifted back
and forth between raw data and theory in order to make
sense of the effect of con?icting logics on organizational re-
sponses (Glaser & Strauss, 1967). In doing so, we focused
on three basic questions: (1) what forces for change are
mentioned by the ?rm; (2) what elements of the ?rm did
these pressures in?uence; and (3) what were the organiza-
tional responses given by the ?rm? The process involved
two distinct steps.
Stage 1. Case studies were written for each of the ?rms
in the sample based on informant quotes as well as archi-
val data (Graebner, 2009) and varied in length between 20
and 40 pages. In these case studies, ?rst, the drivers of
institutional change that resulted in con?icting institu-
tional logics were coded. Following common inductive
processes, we went from broad generic classi?cation of
the issues related to the questions above in the ?rst coding
round, to more speci?c categories in coding round two
such as drivers stemming from rules and regulation, or
automation of processes. These drivers were subsequently
analyzed for their relation to the two existing institutional
logics. However, as it is dif?cult to empirically identify
institutional logics we followed Jarzabkowski, Matthiesen,
and Van de Ven (2009) by searching for indicators of these
logics in our data. We looked in particular for evidence of
norms, beliefs and values associated with each of these
logics such as quality standards and professionalism for
the trustee logic and ef?ciency and pro?tability for the
commercial logic. For the organizational points of conten-
tion we open-coded ?rst for broad categories (e.g. accoun-
tant to advisor, organizational governance, etc.). These
broad categories were speci?ed to the particular issues
pertaining to that category (i.e. for organizational gover-
nance: background management & decision making).
When coded, these organizational points of contention
could be grouped in two categories (Table 2) of strategic
themes for our mid-tier ?rms: (1) the changed role of the
accountant; and (2) changes to the organization’s structure
and practices.
In the third round we looked for speci?c examples of
the categories. For example, for organizational governance,
the authors coded whether a ?rm engaged in directive or
consensus decision making.
The ?nal step in writing the individual case studies was
coding the organizational responses (Oliver, 1991) to each
of the organizational points of contention. We excluded
the avoidance strategy, as in all our cases the ?rms en-
gaged with at least one of the logics legitimating their
praxis. If ?rms continued to comply with the demands of
the professional/trustee logic, they acquiesce to these de-
mands. If they felt that they needed to reconcile demands
from both logics, ?rms are assigned the compromise strat-
egy. If ?rms chose to follow the new commercial logic on a
particular issue, they are assigned the de?ance strategy as
they are defying the old logic. Finally, if ?rms went beyond
what was demanded by the commercial logic, we classify
their strategy as manipulation, as they are trying to change
the logic to their standards.
Independent of each other, two authors coded these re-
sponses and tactics in order to ensure consistency. The
interrater reliability score was .84, indicating good reliabil-
ity (Cohen, 1968). When assigned responses differed, the
authors discussed and determined the appropriate coding.
Table 3 provides the coding scheme for ?rm A document-
ing the various strategic responses for speci?c strategic
issues.
To investigate internal representation we coded for two
clusters of representation. In professional accounting ?rms,
internal representation seems to be particularly salient
with professionals who have been socialized in their pro-
fession and are committed to maintain its values, mainly
based on the long established trustee logic. To capture
the impact of internal representation, we coded for two
groups: non-partnered accountants and accountants who
were partners of the ?rm.
Stage 2. Once all case studies were written and coded,
we conducted a cross-case analysis (Eisenhardt, 1989).
This cross-case analysis served two purposes. First, by
comparing the perspectives of the ?rms, we established
an overview of the institutional pressures on these ?rms
that could be related to the trustee logic or the commercial
logic. This overview is presented in the ?rst part of our
?ndings section.
Secondly, we analyzed the strategic responses to insti-
tutional pressures of the ?rms in our sample for the main
strategic issues identi?ed. In addition to the executed
strategy, we also looked at the reasons the informants gave
136 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
for their particular strategy. The outcomes of this analysis
are presented in the second part of our ?ndings.
Findings
Multiple logics, con?icting demands
For the mid-tier accounting ?rms, we see that there is a
clash of logics and that the drivers of this clash place diver-
gent demands on the organizations. In the next section we
describe how con?icting demands produce heterogeneous
responses. Table 4 shows how both logics relate to the
main drivers of change (strategic challenges).
Trustee logic. The original trustee logic (Thornton et al.,
2005) places emphasis on professional values and techni-
cal expertise of the accountants. Following this logic, all
organizational systems should be geared to accommodate
these demands. Firms deliver a narrow range of profes-
sional auditing-related services, around which the ?rm is
organized. Consensus decision making is the norm and
Table 2
Organizational change categories.
Role of the accountant Organization
Accountant to advisor Organizational governance
Core business(consolidation-advise) Background management/board members
Training Decision making/voting (all-directive)
(Advisory) services Performance pay system
Formal business development Division pro?ts
Range of services, specialist concept Evaluation functionality
Client acquisition (reactive–proactive) Organizational structure
Cold acquisition (Merging) number of locations
Automation of services Critical mass
Portals/online service Separation audit and advisory
XBRL Service lines
Staff services
Internationalization
Network
Clients/services
Table 3
Organizational response strategies and tactics.
Examples of strategies for organization A Strategy Quote
Role of the accountant
Accountant to
advisor
Core business De?ance R1: Yes, we are trying to increase the number of advisory products
Training Manipulate R1: We have created a bachelor in cooperation with a university to train our people
to be able to advise clients
(Advisory) services Formal business
development
De?ance R2: We have hired a business manager, and with him a strategy for new product
development mainly related to automation
Range of services,
specialist concept
De?ance R2: We want to provide business through a full service concept, but also want to hold
on to the bottom of the market
Automation of
services
Portals/online service Manipulate R1: We are way ahead in terms of web based access. We give presentations on it, to
show that
XBRL Compromise R3: We do too little. However, it is a key point for us to increase ef?ciency in the audit
Organization
Organizational
governance
Background
management/board
members
Acquiesce R1: A non-professional needs to be very good to be accepted by a professional, I
doubt we would accept a non-professional at a similar level
Decision making/
voting
Compromise R1: I would be in favor of more directive decision making, but you need to know
when you are directive or when you need to convince
Performance pay
system
Division pro?ts Acquiesce R2: Another sore spot is the reward system. Everyone gets the same based on a point
system, but we do not have a differentiated performance pay system
Evaluation
functionality
De?ance R2: Our performance system has criteria such as how good are you with your clients,
what is your pro?tability and how satis?ed are your people
Organizational
structure
(Merging) number of
locations
Acquiesce R3: It has been debated whether to merge locations, however a lot of people were
against it
Critical mass De?ance R2: You need a large club to get scale advantages from you IT investments, as well as
being able to specialize
Separation audit and
advisory
Acquiesce R3: Our ?rm still has a mixed practice, so we did not separate audit and advice
Service lines Compromise R1: It is a matrix structure organized geographically and through service lines
Staff services De?ance R1: We have staff services with their own directors, who all report to one partner
Internationalization Clients/services De?ance R1: Being in an international network allows you to service your clients in a uniform
manner
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 137
decision making is done at the local of?ces. Pro?ts are
shared and accountants and partners are not directly held
accountable for their ?nancial performance (Greenwood &
Suddaby, 2006). The issue of accountability is directed
mostly towards professional norms and values and the
quality of the auditing practice.
Several of the pressures faced by the set of mid-tier
?rms support these values. The more stringent rules
and legislation put forward by the professional
associations as well as the government reinforce the
importance of the technical qualities and ?duciary
responsibilities of the accountants. If these quality stan-
dards are not met, permits to conduct audits of annual
accounts will not be provided. Two such permits exist,
of which the OOB-permit for organizations of public
importance (i.e. banks, public ?rms, as well as stock-
listed ?rms) sets the most stringent demands. The ‘nor-
mal’ permit allows accounting ?rms to audit organiza-
tions that exceed the threshold for mandatory
deposition of annual accounts. These pressures forced
?rms to invest in quality systems. Coupled to the assur-
ance of quality through legislation is the automation of
the processing of invoices as well as through the
introduction of XBRL systems, which provide real-
time information on the company’s ?nances. XBRL out-
put is increasingly requested by banks when deciding
to provide loans. Clients also stimulate the trustee logic
as they increasingly demand that their accountants are
available and knowledgeable on their particular situation,
as well as locally present. This requires generalist
knowledge on the part of the accountant, local
decision making capabilities and a large number of local
of?ces.
Commercial logic. Although froma trustee logic perspec-
tive the drivers of change demand a focus on, and an
investment in the attainment of high quality standards,
they at the same time force ?rms to be more commercially
oriented. The investments in quality systems as well as in
automation systems and XBRL demand a certain scale
within the organization in order to make investments
lucrative. This however puts a strain on existing practices
such as collegial decision making and local presence.
Additionally, when the core product of the accountant,
the consolidation of annual accounts, becomes automated,
the corresponding pro?t margins drop signi?cantly. As a
result, the accounting ?rms seek other sources of revenue.
We observe that most ?rms start developing specialized
advisory services. This shift to more advice type of services
is also demanded by the clients. Clients want to be advised
on ways to improve their bottom line. This again stimu-
lates the formation of advisory services. Additionally,
international ?rms demand their mid-tier accounting ?rm
to venture internationally, which brings about new sets of
control and performance management processes to im-
prove coordination, at the expense of collegial con-
trols present under the trustee logic. Finally, the
economic crisis has also impacted the mid-tier accounting
?rms directly, forcing them to proactively approach clients
and provide a broader range of services with higher pro?t
margins.
Organizational responses to con?icting demands
The two logics thus present contradicting demands on
how ?rms should organize themselves in terms of strategy,
structure, systems and processes. Our data show that the
balance between these views differs between organiza-
tions and between strategic issues. This leads to different
organizational responses on speci?c strategic issues. These
?ndings will be discussed next. We sequentially analyze
organizational responses to the strategic issues around
the two main themes: the changing role of the accountant
and the implications for organizational structure. Our ?nd-
ings show that organizations are not consistent in their
choice of strategic responses. Rather for each strategic
choice, the ?rms make a separate evaluation of what logic
to follow.
At times, organizations are not able to conduct the
strategy they want because of internal resistance. Consid-
ering the two clusters of internal representation we there-
fore also analyzed how our respondents position partners
and non-partners towards the different strategic issues,
thus identifying the locus of resistance towards institu-
tional change.
The changing role of the accountant
Changes in government legislation have, besides forcing
the mid-tier accounting ?rms to focus on quality, also
introduced elements of free-market competition the indus-
try. Additionally, diminishing revenues from their core
business (consolidation and auditing of annual statements)
due to technological improvements and changing client
demands, force the mid-tier ?rms to change. Clients now
expect their accountants to advise them on how to im-
prove their business. Related to this changing role, our data
show that the ?rms need to decide: (1) to which degree
and how do they want to make the transition possible;
(2) what services they want to deliver; (3) how much effort
they place in client acquisition; and (4) how heavily they
invest in automation of their services. Table 5 provides
an overview of ?rm responses with regard to the changing
role of the accountant. In general there are in three groups
of ?rms that can be clustered together based on their incli-
nation to adopt practices from the new logic.
Almost all ?rms recognize that, as their core business is
changing, the role they play as an accountant also has to
change. They try to do this in two ways. First, almost all
?rms – except for ?rms D and K – express the need to auto-
mate the process of creating annual accounts. Although
they continue to see this part of their work as important,
it is no longer the main source of income. Hence it needs
to be as ef?cient as possible. As one respondent illustrated
his ?rm’s de?ance strategy:
‘‘We have digitalized the consolidation department. It is
really an assembly-line idea. The creation of annual
accounts needs to be ef?cient. This together with advisory
services is essential. Both need to be perfect, it is not that
one is less than the other, but you just need to automate
those things that can be made more ef?cient’’ H1.
138 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
Table 4
Drivers of strategic change and their effects according to the trustee and commercial logics.
Example quotes Effect according to
trustee logic
Drivers Effect according to commercial
logic
Example quotes
E1: Regulation for accountancy
?rms has changed to such as
extent that we have made our
audit branch a separate
entity. Responsibilities and
duties are such that they are
in line with AFM demands.
We have increased our quality
we now have tighter
procedures
More stringent
certi?cation demands
place emphasis on
quality controls and
professional values
Rules and
regulation
The increased quality demands
requires ?rms to invest in quality
systems and controls, this
requires suf?cient size (critical
mass) to make this worthwhile
E1: The investment in quality
due to increased regulation has
cost us tons of money and had a
tremendous impact on the
organization
K2: Introducing a quality system
costs money and as a result you
need to expand
F3: When you look at the
regulatory changes, this has
had a tremendous impact on
the internal organization of
the ?rm
D1: This forces us to send
?nancial messages via the
internet at an agreed
standard. A few years ago, the
government forced us to sign
a covenant to deliver ?nancial
statements in XBRL format
Automation and standard
reporting language
systems place emphasis
on quality controls and
professional consistency
Automation
and XBRL
Automation and standard
reporting language systems
reduce pro?ts from core product,
the annual statement, forcing
accounting to engage in different
services
B2: Another big change has of
course been technology. The
invoice processing, which we
used to do in the past is
disappearing because of
computers. This means we need
to change our business model
from making ?gures to
explaining them. When you go
from producing to explaining
?gures; that demands a different
skill set
E1: XBRL should reduce the
administrative burden by being
able to quickly connect with the
banks, tax authority and
chamber of commerce. This
should really improve ef?ciency
and is a very exciting
development
A1: We have an international
network that others do not
have, but we also have a
personal approach that ?ts
our customer segments. They
demand this of us
Clients demand local
presence and generalist
approach of their
accountant
Client
demands
Clients not only demand an
annual statement, but also
advice on how to improve their
performance. Additionally
international clients demand
international services
C1: Clients have less interest in
looking back, they have got that
covered with their bookkeeping
software, what they seek is a
partner in business that will help
them look forward
H1: Our clients want their
accountant close by, so that if
something goes wrong you
can quickly react. Because we
know the local network we
can help in all sorts of ways
F2: Clients are no longer
interested in the annual
statement; they are interested in
what they can do with those
?gures
Economic/
market
conditions
The dire economic situation in
general and the dif?cult market
conditions in the accounting
sector in particular have pushed
?rms to place emphasis on new
business generation and
development, ef?ciency and
change in services
C2: Well what you see is that the
crisis actually ensures change
takes place automatically; you
end up with lower pro?ts so you
need to do something.
J1: I think the accountancy
market will continue to
consolidate. It is very scary as it
looks like there is overcapacity
on the supply side
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 139
The primary reason why ?rms differ with regards to the
extent in which they embrace the new role of the account
lies in the value they attach to the old role. During the
interviews, it became clear that strategies in relation to
the changing role of the accountant were often adapted
in the face of internal resistance by non-partner accoun-
tants and in some cases by partners. This is illustrated in
Table 6.
Firms B, C, E, G, H and I are somewhat between logics, as
they perceive the need to change their service portfolio but
develop it in an ad hoc manner with their core service, the
consolidated account, as basis for these advice services.
They also have not yet developed specialized services to
any great extent, although some specialized services for
speci?c industries are present. Respondents from these
?rms emphasize the need to limit their diversi?cation to
competencies within the accountancy profession:
‘‘[The advisory services] are clearly ?nancial and accoun-
tancy related. Risk management, insurance, independence,
integrity, those are the most important elements, so we
clearly do not see ourselves as a consultancy ?rm’’ D4.
‘‘At one point you lose your way. You end up offering a type
of service of which you think ‘what has that got to do with
accountancy?’ That’s what you see happening with the big
4. . .I think it is important that you can still see a clear link
with the original professions. Management consulting is
something completely different. I think it’s dangerous’’ G3
‘‘You have to offer things you are good at. We are good
with numbers, so offer services involving numbers. The
question is do we really know anything about strategy?
Is that part of the job of an accountant? What are the bor-
derlines? I think every ?rm can make its own decision, but
we try to re?ect if we are not moving to far away from our
core qualities’’ H3.
However, most also indicate that their accountants ‘‘in
general resent change and if it where up to them, in ten years
time they would still do the same thing’’ (H3), and that
‘‘change leads to fear and fear leads to resistance’’ (E1). They
describe them as ‘‘used to looking to the past not the future’’
(C3), preferring ‘‘not to have too much contact with dif?cult
clients’’ (K2) and in general question what this change
means for them. Therefore, these ?rms offer their accoun-
tants training options to provide them with the necessary
skills and prepare them for change. However, a number
of respondents indicate the transition is a lengthy process.
Firms A, F, and J – have fully embraced the new role.
They invest heavily in developing new products; offer a
wider range of services, complemented with industry spe-
ci?c or product speci?c specialized services. To achieve
this, they sidestep the accountants who stick to their old
role:
‘‘However, we do this with a lot of non-accountants. We
are more and more attracting people from a different back-
ground, with other competencies. I don’t believe you can
retrain accountants’’ J1.
In ?rm J, accountants that did receive training opportu-
nities openly rebelled to the point where the board was
asked to intervene. Another example is ?rm F; the ?rst to
have relation managers. As ‘‘the average accountant does
not have the communication or commercial skills necessary’’
(F3), they often attract non-accountants, who brainstorm
free of charge with clients to discover their needs. Subse-
quently the back of?ce caters to these demands and deliv-
ers the services, ranging from accounting, organizational or
law related advice.
The ?nal set of ?rms – ?rms D and K – still comply pre-
dominantly with the trustee logic. Although ?rm D per-
ceives the need to develop new products and invests in
them, it is not investing signi?cantly in automation in or-
der make the creation of annual accounts as ef?cient as
possible. Some informants indicate this is mostly due to
inertia rather than professional determination:
‘‘With these things [innovations in XBRL and services]
things need to hurt ?rst before we start acting. . ..during
Table 5
Firm speci?c responses relating to the role of the accountant.
a
Role of the accountant Acquiescence Compromise De?ance Manipulation
Accountant to advisor Core business K B, C, D, E, G, I A, H, J F
Training J, K C, D, E, G, H A, B, I
(Advisory) services Formal business development E, K A, B, D, H, J I
Range of services, specialist concept B, D, E, G, H, I, K A, C, F, J
Cold acquisition B, C, H, J F, K D, G, I
Automation of services Portals/online service E, I B, C, H, J A, F
XBRL D, K A, C, E, I B, F, J
a
Firms have not commented on all strategic choices. If that was the case they were not assigned a strategy.
Table 6
Locus of resistance to the changing role of the accountant.
Role of the accountant Accountants Partners
Accountant to advisor Core business A, C, D, E, F, H, I, J, K K
Training E, G, I, J
(Advisory) services Formal business development D, K K
Client acquisition Cold Acquisition D, G, H, I, K G, H, I, K
Automation of services XBRL B B, D, K
140 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
partner meetings we’ve talked about it but nothing hap-
pens. Entire groups are just not entrepreneurial enough;
partners are not entrepreneurial enough to see that now
is the time to be creative. First things really have to start
hurting before anything will actually change’’ D3.
‘‘People don’t want to look too far ahead as long as money
keeps rolling in.’’ K1
Another new technique introduced because of in-
creased market competition is cold calling. This practice
was frowned upon and deemed unprofessional until rela-
tively recently. Although a number of ?rms (D, G and I)
make use of it, most ?rms resist or sparingly use this prac-
tice, both at the level of the non-partnered accountant and
the partner. Almost all ?rms remark that their relationship
with clients is based on trust: ‘‘it’s a trusting relationship,
you’re not selling pens or coffee machines, we are selling
added value in a trusting relationship’’ (H2). They describe
their role as shifted from a ‘‘controller to an advisor’’ (A1,
H1), ‘‘a sparring partner’’ (B1) or even to ‘‘a general practi-
tioner’’ (F2). Hence most agree that they need to compete
on quality through specializations and not on price and
that ‘‘accountants are hesitant to use it [cold calling] as they
feel they need this trust relationship’’ (K1).
In all, the shifting role of the accountant is not whole-
heartedly embraced by partners and non-partners alike.
Partners perceive the need to complement their existing
practices with advisory services, as long as it relates to
their original profession. Non-partnered accountants how-
ever are fearful and resistant to this change as it forces
them to draw on a completely different set of abilities as
compared to their original work. This results in differing
organizational responses ranging from limited addition of
advisory services to addition of related services by training
accountants or by decoupling the back of?ce from the
frontline or hiring non-accountants. With regard to the
possibility of advertising and a more pro-active market ap-
proach, ?rms obtain new leads in various ways. Neverthe-
less, cold calling is still considered undesirable for the most
part as it violates the trust relationship with clients
respondents perceive to be essential for selling their advi-
sory services.
The changing organizational practices
The drivers for change do not only in?uence the role of
the accountant, they also in?uence organizational prac-
tices. Main drivers here are: imposed rules and regulation
that demand high control of quality; developments in
technology that require more formal organization, a coher-
ent organizational system, and ‘critical mass’; the global-
ization of clients has led ?rms to join international
networks, which in turn demand certain changes in struc-
tural arrangements; and, demands of clients for more spe-
cialized advisory services that again have implications for
‘critical mass’. Our data show that organizations have to
decide how they respond in four important ways: (1) ?rms
make choices about their governance system (maintain
their traditional form of organizational governance
through collegial decision making, place the management
of the ?rm in the hands of a non-professional, or engage
in directive decision making); (2) ?rms need to decide on
their management control systems, moving from tradi-
tional professional and collegial controls to performance-
pay systems that can stimulate new client acquisition
and successful delivery of new advisory services; (3) ?rms
reevaluate their organizational structure following more
stringent quality demands; and (4) ?rms need to decide
how to respond to the increasing client demand for inter-
national services. Table 7 provides an overview of ?rm re-
sponses with regard to organizational structures and
practices.
All ?rms agree that given their shift to more specialized
services and automation they need critical mass, either by
consolidating locations or by increasing the size of their
of?ces:
‘‘That [critical mass] is just necessary for the continuity of
your services, but also for your people. You enter as junior
and when you are alone, what opportunities for personal
development do you have?’’ H2
‘‘If you want to compete, you just need volume in order to
offer specialized services and to be able to make future ICT
investments. You need it to ensure the quality to be able to
make the move from a lot of administrative work to more
advisory services and to act as coach of an entrepreneur’’
F3.
Similarly, most ?rms have separated their audit branch
from their other services although this is not required by
law for this group. Again this change is made to ensure
quality:
‘‘Mostly in order to ensure quality, in order to be able to do
suf?cient audits and to ensure control. I am convinced that
if you conduct too few audits, you start making mistakes’’
F3.
Although consolidation of a number of of?ces has taken
place in some ?rms, they also all agree that they require a
local presence to best service their clients:
‘‘Well actually if you look at the situation from a cost
reduction perspective, it is of course important to have
fewer of?ces. But when you look from a commercial per-
spective and the way we are positioned in the market –
for small and medium-sized ?rms – you have to show your
face in the market. Also, I believe that the of?ces can’t be
that big that people are scared of the sheer size of an of?ce.
You need to meet their way of doing business’’ B1.
We start to observe differences in ?rm responses when
it comes to topics that affect the vested interests of the
partners: the decision making process, performance-pay
schemes and the presence of non-professionals as manag-
ers. We can discern two clusters of ?rms. The ?rst cluster
of ?rms (A, B, C, D, E, G, H, I and K) makes little changes
with regard to their organizational practices and continues
to adhere to the demands of the trustee logic. Most ?rms
still have partners who manage the ?rm through collegial
decision making processes. These processes however, are
slightly more directive to reduce differences in implemen-
tation of strategic decisions.
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 141
‘‘It’s a little back and forth. Sometimes people are fed up
with the constant discussion and want the board to be
more directive. On the other hand if you are too directive
you get criticism, we are all partners with a vote, and they
all want to use it. So you need balance’’A1.
Within and between these clusters there again is great
divergence in the practices these ?rms adopt and resist.
For some ?rms in the ?rst cluster, informants point to
the diverse constellation of practices and partners (D4) or
their own little islands (I3) as the reason for their resis-
tance. They want to ensure that ‘‘their own people come
?rst. . . and just as long as things get arranged for their of?ce’’
(A4). Other informants point to the differences with the big
4 ?rm that they left, as the desired freedom that they did
not had there, but do have in their mid-sized ?rms.
‘‘At least we have the illusion, and I think that it is true in
practice, that we have the freedom to create and develop
our own ideas, celebrate our successes but also bear the
consequents of our ways of working. Just the freedom of
entrepreneurship that you lack in any big of?ce’’ G1.
Therefore most ?rms indicate they decide on the strate-
gic plans centrally but ‘‘locally they have the freedom to put
it into practices as you think best’’ (E1).
This is clearly related to the clear absence of non-pro-
fessional managers and the reason is unambiguous:
‘‘I think that if you are in a managing position and you
don’t know what is happening with the clients, that is just
not good. You need to have day-to-day experience’’ B1.
Another practice these ?rms resist is performance-pay
schemes, because there is not ‘‘much applause for it’’ (E1).
As local presence is necessary, as long as there is agree-
ment on the roles in the ?rm and on how partners contrib-
ute and as long as of?ces do not seriously underperform,
partners do not perceive the need to change the equal prof-
it sharing system. In fact:
‘‘But in the really big of?ces, you can see it gets greedy,
with those differentiated pro?t shares focussed on individ-
ual performance. It may be that it is necessary in large
?rms in order to keep it manageable. But undoubtedly it
will lead to political games that are not in the interest of
the entire organization’’ G3.
One informant goes even further by stating that the rea-
son they have not implemented such a system is that: ‘‘We
don’t have pro?t maximization as a main goal. We just
want to earn enough to continue the business and be able
to offer a certain level of quality in our services’’ (C1).
Finally some ?rms decide to cater to the international
wishes of their clients, most by joining an international
network as they do not want to open up of?ces abroad.
This however is clearly related to client demand.
The second cluster of ?rms consists of only two ?rms –
?rms F and J – that have adapted most of their structures to
the new commercial logic. Firm J has a non-professional
managing partner, whereas Firm E has of?ce managers in
charge of its local of?ces. Firms F and J have abandoned
collegial decision making in favor of more directive forms.
As ?rm J indicates:
‘‘We do not discuss strategy monthly because we just don’t
allow it. We did that before but in order to create a steady
course we stopped. Otherwise you keep changing direc-
tion’’ J1.
Firm F also works with differential performance-pay
systems for partners and employees (‘‘Yes, we have perfor-
mance-pay systems down to the secretary including a share in
the pro?t’’, F2) and has high levels of directive decision
making. At the same time, however, Firm J has decided to
create more and smaller of?ces throughout its region, sig-
ni?cantly smaller than the average of?ce of the other mid-
tier ?rms but more importantly which would not be
staffed with accountants.
‘‘Imagine a nice place where you can meet with clients,
where you can discuss strategy, where there are big white-
boards. Well you don’t need accountants there; we have
put them together in one of?ce.’’ J1.
However, ?rm J is an exception. Overall there is rela-
tively little change in the practices and structures of most
organizations. Where resistance to changes in the role of
the accountant was located more at the level of non-part-
nered accountants, the resistance against changes in orga-
nizational structure and practices is solely attributed to the
partners. Especially with regard to the governance of the
?rm, almost all informants indicated that a non-profes-
sional as managing partner would not be accepted as they
Table 7
Firm speci?c responses relating to organizational structures and practices.
a
Organization Acquiescence Compromise De?ance Manipulation
Organizational
governance
Background management/board
members
A, B, D, F, G, I C, H, K E, J
Decision making/voting C, H, K A, B, D, E, G, I J F
Performance pay system Division pro?ts A, E, G, H, I, J, K C B, D, F
Evaluation functionality K C, F, H, I, J A, D, E
Organizational structure (Merging) Number of locations A, B, C, D, E, F, G, H, I, J, K
Critical mass C, D, F, G, H, I, K A, B, E J
Separation audit and advisory A, K C B, D, E, F, H, I
Service lines A, H B, D, G, I
Staff services C A, B, D, F, G, H, I, J
Internationalization Network E, J, K C, F, H, I G D
Clients/services E, J B, F A, G D
a
Firms have not commented on all strategic choices. If that was the case they were not assigned a strategy.
142 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
believe a ?rm grasp of the profession is necessary to run
the ?rm. Similarly most partners still want a say in the
strategic direction of the ?rms, hence these ?rms still em-
ploy, for the majority, collective decision making pro-
cesses. The sources of resistance are shown in Table 8.
Clearly our mid-tier ?rms have little interest in changing
the basic structure and identity of their accounting ?rms,
cherishing their professional norm of autonomy.
Discussion
In this study we set out to investigate organizational re-
sponses by mid-tier accountancy ?rms in the face of con-
?icting institutional logics. While most studies describe
how institutional changes trigger institutional action by
either elite (Greenwood & Suddaby, 2006) or maverick ac-
tors (Leblebici et al., 1991), we focused on mainstream ac-
tors in an organizational ?eld. Based on our analysis of
interviews with 34 top management level informants of
11 mid-tier accounting ?rms and an investigation of sec-
ondary material, we make three main contributions. We
enhance understanding of how the characteristics of
accounting as a profession affect organizational resistance
and change in mid-tier ?rms. Second, we shed light on the
concrete organizational responses in mid-tier accounting
?rms to institutional change. Third, we question the gener-
alizability of PSF research.
Sociology of professions and organizational resistance
Our ?rst contribution is to the literature on the sociol-
ogy of professions and our understanding of the drivers
of change in the accounting industry. Academics have been
critical about the motivations of professionals for main-
taining their status. They have challenged the extent to
which claims to social closure and economic monopoly
are legitimated by the profession’s societal function and
responsibility (Reed, 1996; Tinker, 1985). Instead they
see these activities merely as means to constitute and con-
trol the market by creating scarcity for their resources (Fre-
idson, 1984; Larsson, 1977). As the accounting industry
developed, the shift in emphasis from trustee logic to com-
mercial logic (Dezalay, 1995; Hanlon, 1996) and its conse-
quences have been referred to as evidence of this position.
While big 4 ?rms argued for the necessity of an evolution
towards a more client-oriented and more consciously
managed ?rm in order to provide high-quality accounting
services (Suddaby & Greenwood, 2005), indicative of the
dif?culty of this move away from the trustee logic are
the ENRON scandal (Covaleski, Dirsmith, & Rittenberg,
2003) and the recent ?nes imposed on the big 4 ?rms for
audit failure (Financial Times, 2012a, 2012b). According
to Wyatt, greed has in?uenced professional accountants
such that the ‘‘core values of the professional ?rm were
undermined by primarily commercial interests’’ (Wyatt,
2003, p. 6) and Greenwood (2007) argues that the balance
between pro?ts and professionalism has shifted to the det-
riment of professional behavior. Academics note that the
shift has led to an emphasis on pro?t-maximization (Elliot,
1999 in Samuel, Covaleski, and Dirsmith (2009)). This shift
inherently also meant the adoption of new sets of organi-
zational structures and practices associated with this com-
mercial logic (Cooper et al., 1996; Greenwood & Suddaby,
2006; Hanlon, 1996, 1997).
In our sample, we observe that the choices that the mid-
tier ?rms make in terms of their structures and processes
draw on both economic and professional rationales. How-
ever theprofessional logic seems toremaindominant. While
the leadership of these ?rms understands that they have to
offer moreadvisoryrelatedservices becausetheir coreprod-
uct will no longer be pro?table in the near future, the types
of services they offer are closely relatedto their original pro-
fession. They argue that to offer anything not connected to
the profession would endanger professional standards. In
professional services ?rms, the individual professional’s
job description and identity are directly informed by the
standards of the profession that to a large extent also make
up the organization’s institutional environment (Green-
wood et al., 2002; Scott, 2008; Suddaby & Greenwood,
2005). Furthermore it is part of the professional’s identity
and responsibility to actively maintain the professional
institution, thereby resisting the commercial market logic
(Freidson, 2001). Similarly, while the big 4 attract different
sorts of experts to provide their advisory services, 9 out of
our 11 ?rms dismiss this idea. Of course, commercial and
economic arguments do play a role. Most ?rms decide to
automate their consolidation services as well as remain
close to the clients as these clients demand their local pres-
ence. However, they argue from a professional perspective
that the separation of audit and advisory is necessary to en-
sure continued quality of both. Also most ?rms do not en-
gage in cold calling as yet again this goes against their
professional identity and is not helpful given the long-term
trust relation they seek with their clients. In all, while of
course the aim of these ?rms is also to make a pro?t, which
in itself does not contradict the professional ethics and ser-
vice to society ideals (Freidson, 2001), their explanations for
reported changes are very much geared towards maintain-
ing professional standards and the quality of services. These
Table 8
Locus of resistance to the organizational structure and practices.
Organization Accountants Partners
Organizational governance Background management/board members A, B, D, F, G, I
Decision making/voting A, C, G, I
Performance pay system Division pro?ts E, G, H
Organizational structure (Merging) Number of locations D
Service lines A
Internationalization Network D, G
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 143
?ndings mirror what Hanlon (1997) found in the lawindus-
trywhere professionals insmaller ?rms continue to drawon
much of the social service ethos and rhetoric and are hostile
to managerialism. In sum, we argue that the sun is not set-
ting on professionalism in mid-tier accounting ?rms. Their
embeddedness in the original professional logic with an
emphasis on service ethic is still strong and is supported
by the type of relationship requested by their local clients.
A second insight we draw from our ?rms is that
although in some cases top management does see the merit
of a proposed change, often it is unable to align its internal
constituency. While partners underscore the need to offer
advisory services in order to ensure pro?tability, non-part-
nered accountants resist this practice as they are risk averse
and afraid of the implications of this shift. Hence a slow
process of training and formal business development is
put in place to provide themwith skills and knowledge nec-
essary to make the change. We also ?nd evidence of resis-
tance at the level of the partners. Covaleski et al. (1998)
as well as Dirsmith et al. (1997) ?nd in their studies on
the introduction of management by objectives that admin-
istrative partners wish to control and shape behavior of
practice partners and non-partnered accountants but that
this is resisted by practice partners as it limits their auton-
omy. We see a similar resistance to structures and pro-
cesses that limit partner autonomy. In the ?rms in our
sample most managing partners and practice partners
alike, are still actively involved in the delivery of services
and as such resist the same practices and structures. For in-
stance they resist the merging of locations, very directive
forms of decision making, individualized performance-pay
systems and the presence of non-professional managers.
For future research it could be of interest to explore what
the shift from the trustee to the commercial logic, and the
concomitant development of organizational structures and
processes, means for the non-partnered, non-managing
accountants. While our informants report themto be ingen-
eral riskaverse, thereasonfor their resistanceis still unclear.
Their importance as a source of resistance however is clear
as ?rms do have to adapt their organizational responses to
move theminto the zone of acceptability (Ansari, Fiss, &Za-
jac, 2010; Lewis & Seibold, 1993; Radnor, Feller, & Rogers,
1978) for this group of professionals.
Organizational responses, archetype change and institutional
logics
Our second contribution is to the literatures onorganiza-
tional responses, archetype change and, particularly, insti-
tutional logics. Studies of organizational responses to
institutional pressures (Oliver, 1991) are numerous but of-
ten focus on the adoption or non-adoption of speci?c prac-
tices (e.g. Ang & Cummings, 1997; Fiss & Zajac, 2004,
2006; Goodrick & Salancik, 1996; Greening & Gray, 1994;
Lounsbury, 2001, 2007; Milliken et al., 1998; Rao & Sivaku-
mar, 1999; Thornton, 2002; Westphal et al., 1997). Also,
studies investigatingthe?eldlevel end-states ininstitution-
ally complex ?elds show a number of different outcomes
like a shift from the old dominant logic to the newly intro-
ducedlogic (e.g. Thornton, 2002; Zilber, 2002); the introduc-
tion of elements of a new logic into a dominant one (e.g.
Glynn, 2000) or the hybridization of elements of both the
old and new logic (e.g. Colyvas & Powell, 2006; D’Aunno
et al., 1991; Purdy & Gray, 2009). However, little is known
regarding the micro-level processes of how organizations
and actors respond to competing institutional pressures, in
which the process of ?eld level change has yet to be played
out. In this paper, we look at howaccounting ?rms strategi-
cally respond and develop their portfolio of practices. Doing
this, we heed the call for more research connecting ?eld log-
ics, organizational practices and industry institutional
change(Lounsbury, 2008; Thorntonet al., 2012) andprovide
further insight into early stage blending experimentation by
organizations: a situation where organizations experiment
with the development of novel practices following changes
in the inter-institutional system that shift the relative
importance of multiple ?eld-level logics.
Besides clearly documenting how the existing institu-
tional logics place con?icting demands on our sample
?rms, we ?nd that in their responses to pressures from
the trustee and commercial logics, our mid-tier ?rms do
not choose one consistent strategy vis-à-vis the institu-
tional pressures. Mid-tier accounting ?rms respond selec-
tively and independently to strategic and structural
issues invoked by the new commercial logic. Most ?rms re-
main adherents to the trustee logic in which they are still
heavily embedded (Granovetter, 1985; Greenwood & Hin-
ings, 1996; Maguire, 2007; Oliver, 1997). Due to the previ-
ously mentioned sources of organizational resistance and
the perceived suitability of elements of both logics for
resolving concrete managerial challenges, strategic re-
sponses to the challenges of the new commercial logic dif-
fer substantially between ?rms. Thus we see a fragmented
implementation of elements of the new logic, not based on
the internal coherence of the logics at hand. This is in line
with a toolkit perspective of logics where logics guide indi-
vidual’s focus of attention, but where the activation of as-
pects of speci?c institutional logics is contingent on their
applicability and relevance in a speci?c situation (Thorn-
ton et al., 2012, p. 84). Our ?ndings thus indicate that rel-
evant situational cues come from both the issue at hand
and the organizational role of the actors involved. Our ac-
tors seemto draw on logics as sort of cultural toolkits (Swi-
dler, 1986), highlighting their partial autonomy from social
structure, allowing them to pick and choose their re-
sponses. However, while dependent on situational cues,
our ?ndings indicate that we cannot place the mechanism
of action completely outside the person. A criticism on the
original cultural toolkit-perspective is that it is without a
clear mechanism of motivation. This criticism is motivated
by the ?nding of earlier research that much cultural infor-
mation is inherently contradictory and cognitively stored
without ‘truth value’, it therefore cannot be a theory of
motivation (e.g. DiMaggio, 1997). According to Boltanski
and Thévenot (1991) the role of values in a toolkit perspec-
tive is for justi?cation, rather than moral motivation. We
would argue that our mid-tier accountants do not just
selectively use applicable institutional logics for analysis
and decision justi?cation. While they draw on both eco-
nomic and professional rationales, their argumentation re-
?ects both elements of rational justi?cation and moral
motivation drawn from the relevant fundamental institu-
144 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
tional logics in the inter-institutional system – the profes-
sional and market logics (Thornton et al., 2012). This moral
motivation is especially pronounced with regard to
changes that impact the values associated with their origi-
nal professional identity that have been imprinted through
socialization.
Our ?ndings thus highlight the relevance of further re-
search into how situational and positional circumstances
affect individuals’ focus of attention and their evaluation
of applicability and relevance of institutional logics in deci-
sion-making processes. Furthermore, further investigation
of how actors choose and use elements of logics for justi?-
cation and/or moral motivation of choices in processes of
institutional change seems warranted to better understand
the dynamics of practice developments in ?elds governed
by multiple con?icting institutional logics.
Our ?nding that these mid-tier accounting organiza-
tions draw on institutional logics as a toolkit contradicts
expectations of integral change towards organizational
archetypes based on the new (commercial) institutional lo-
gic. Institutional logics involve values and beliefs by which
individuals produce and reproduce their material subsis-
tence (Thornton & Ocasio, 1999). As such they directly
in?uence organizational structures and processes (Green-
wood et al., 2009). This is closely related to the concept
of interpretive schemes which underlie organizational
archetypes. Archetypes are interconnected structures and
systems that together support the particular values and
norms at the heart of the substantiated interpretive
scheme (Greenwood & Hinings, 1993). This would thus
mean that logics and archetypes should form logical and
interrelated practices which should be shown in a similar
con?guration. Examples are studies of the development
of Multidisciplinary Practice in accounting ?rms (Green-
wood et al., 2002) or the Managed Professional Business
in law ?rms (Cooper et al., 1996) as archetypes that re?ect
the emphasis on the commercial logic.
Such coherence however is not observed in our group of
mid-tier ?rms. The toolkit approach our mid-tier ?rms em-
ploy to deal with each of the speci?c issues they face, re-
sults in hybrid structures on the organizational level
(Greenwood, Raynard, Kodeih, Micelotta, & Lounsbury,
2011). These organizational strategies in the face of institu-
tional complexity resonate with the process of sedimenta-
tion in the development between archetypes (Cooper et al.,
1996). However, while sedimentation is a process of be-
tween-archetype changes by coupling mutually constitu-
tive interpretive schemes on top of each other, we are
unsure if this is the case for our mid-tier ?rms. The ?rms
continue to draw heavily on the professional interpretive
scheme and move only in small incremental ways towards
a more commercial scheme. However, as we are still in the
early stages in the transformation of the mid-tier segment
of the accounting ?eld, it is too soon to judge if this is the
start of a process of between archetype change or a within
archetype change. This may well be a case of what Morris
and Pinnington (1999) imply as a ‘‘more recursive and
re?exive model where old and new values and systems
interact and reinterpret each other’’ (Brock et al., 2007, p.
244). An interesting area for future research here is the
in?uence of a hybrid organizational structure on organiza-
tional objectives such as performance and professionalism.
As archetype theory is premised on con?gurational theory
in which organizational structures and practices act in a
complementary way (Greenwood & Hinings, 1993), in this
perspective using a toolkit approach leads to blending of
logics and subsequent loss of coherence between organiza-
tional systems and processes. Additionally, given that
many of the mid-tier ?rms experience internal resistance
to these espoused changes, it begs the question if these hy-
brid ?rms will be equally successful in achieving their
objectives.
On the institutional ?eld level, there is evidently not a
wholesale move to the commercial logic in the accounting
?eld. Where the commercial logic and its related archetype
is present in the big 4 ?rms, among mid-tiers we are in a
period where several competing organizational designs ex-
ist. As such, the process of diffusion looks more like a pro-
cess of institutional bricolage (Aldrich, 2010) and we
cannot detect any logical interrelatedness of practices.
Considering the institutional development of the ?eld of
accounting it thus seems warranted to further follow up
and investigate the ways in which the theorization of the
competing logics (Greenwood et al., 2002) and the incre-
mental adaptation of organizational practices result in
competing and evolving organizational designs.
Generalizability of PSF research
A third contribution we make is to the literature on PSFs
by addressing the issue of generalizability (Von Nord-
en?ycht, 2010). Much of the ?ndings relating to the shift
from the trustee to the commercial logic are premised on
evidence from case study research (Malhotra, Morris, &
Hinings, 2006). There are however, certain contingencies
that raise questions regarding the generalizability of the
extent of this shift across different strata of professional
?elds (Cooper et al., 1996; Pinnington & Morris, 2003) as
well as between professions (Malhotra & Morris, 2009).
Our ?ndings offer insights in both types of generalizability
issues and heed the call for research that goes ‘‘beyond the
larger ?rms’’ (Malhotra, Morris, & Hinings, 2006, p. 198).
In terms of inter-professional comparisons, Malhotra
and Morris (2009) suggest a number of contingencies that
can explain differences in support for the trustee or com-
mercial logic. First, PSFs that draw on normative knowl-
edge (e.g. law ?rms) are likely to have a professional
organizational form, whereas those PSFs that draw on syn-
cretic knowledge (e.g. accounting ?rms) are likely to have a
professional-bureaucratic hybrid organization. Also, strong
social closure should lead to limited specialization and
resistance of diversi?cation. Additionally, a high degree
of face-to-face interaction with clients should lead to a
large number and more dispersed of?ces. Overall, the accu-
mulated studies suggest that accounting ?rms, because of
these characteristics have moved more to the MPB form
(cf. Greenwood & Suddaby, 2006) whereas law ?rms more
closely resemble a sedimented form remaining closer to
the professional form (Ackroyd & Muzio, 2007; Pinnington
& Morris, 2003). Our ?ndings however paint a slightly dif-
ferent picture. Our mid-sized accounting ?rms follow the
same path as medium-sized law ?rms in which profession-
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 145
alism remains dominant. For instance, mirroring Cooper
et al. (1996) we also ?nd that democracy is important
and compensation schemes remain tolerant in terms of
performance. Additionally, we ?nd that they maintain a
large number and often dispersed local of?ces due to client
demands and engage in limited specialization and resist
diversi?cation even though social closure has been less-
ened of late. Our ?ndings thus suggest that the extent of
social closure, the degree of face-to-face interaction or
the type of knowledge employed may account for some
of the differences in organizational forms between profes-
sions; but that the extent of embeddedness of small and
medium-sized ?rms in their local institutional context is
also of signi?cant in?uence (Greenwood et al., 2002; Ra-
mirez, 2009) and leads to similar developments for mid-
tier ?rms in the ?elds of accounting and law.
Within professions there are segments that have differ-
ent and even con?icting value positions (Strauss, 1975)
due to these differences in embeddedness. Evaluating var-
iation in organizational forms among professional service
organizations Malhotra et al. (2006) indicate the need for
further investigation of these ‘‘within-profession’’ differ-
ences. Where Hanlon (1997) already found divergent re-
sponses to the commercial logic in the law industry with
professionals in smaller ?rms continuing to draw on much
of the social service ethos and rhetoric, we ?nd that the
changes in the big-4 accounting ?rms identi?ed by Green-
wood and Suddaby (2006) cannot straightforwardly be
extrapolated to the mid-tier ?rms in the accounting indus-
try. As these ?rms remain more embedded in their local
institutional context, they are more dependent on the na-
tional associations as sites of professionalization than large
professional ?rms that develop and provide much of their
training in-house (Cooper & Robson, 2006; Ramirez, 2009).
Also they service a different type of clientele (Ramirez,
2009) and their professionals have greater in?uence on
the day-to-day dealings within their ?rms. In contrast
the big 4 in Greenwood and Suddaby’s (2006) research
are operating in an international arena, dealing with multi-
national clients in a supra-national arena. Our mid-tier
?rms are well-established in their national professional
arena and our ?ndings indicate that professional norms
are stronger with this group. This echoes the ?nding of
Greenwood et al. (2002) who noted that the regional and
local ?rms in their study had only modest sympathy for
the new organizational form of the big 4 ?rms. We clearly
see the group of mid-tier ?rms responding to the con?ict-
ing institutional logics that have been recognized in previ-
ous research on the big 4 accounting ?rms. However, while
these large ?rms had a relatively comprehensive/consis-
tent agenda pushing the commercial logic, our study sug-
gests that organizational responses to con?icting or
changing logics may be subject to different dynamics
across different sets of actors within an organizational
?eld. Greenwood and Suddaby (2006, p. 44) documented
organizational change within the big 4, and asked: ‘‘how
in?uential are professional norms when required to stretch
across very different organizational members, ranging
from elite, central ?rms, to modestly sized, local ?rms?’’
We would argue that they are quite strong for both part-
nered and non-partnered professionals in mid-tier
accounting ?rms. In order to address the issue of general-
izability both across and within professions we call for fu-
ture micro-level research in order to determine how and to
what extent embeddedness in local institutional environ-
ments explains the continued adherence of mid-sized
and small ?rms to the trustee logic and as a consequence
its related organizational form.
Acknowledgements
Michel W. Lander would like to thank the AXA Research
Fund for its ?nancial support and Bas A.S. Koene would like
to thank the Erasmus Trust Fund and the Stockholm Centre
for Organizational Research for their support.
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doc_777060773.pdf
We study how mid-tier accounting firms deal with changes in their institutional environment
that resulted in a shift in emphasis from the trustee logic to the commercial logic. We
find that these mid-tier firms selectively adopt practices related to the commercial logic,
while retaining a principal commitment to the trustee logic. Interviews with high level
informants in these firms show how specific strategic choice opportunities serve as independent
critical events framing practice-adoption decisions. Main strategic issues for the
mid-tier firms relate to the changing role of the accountant and changes in organizational
structure and practices. As these issues fundamentally challenge characteristics of their
professional identity, there is internal resistance against this transformation. Nonpartnered
accountants mainly challenge new roles that upset their extant work routines,
whereas partners resist changes affecting their autonomy. These types of resistance
directly impact the strategic organizational responses of the accounting firms to institutional
pressures.
Committed to professionalism: Organizational responses of mid-tier
accounting ?rms to con?icting institutional logics
Michel W. Lander
a,?
, Bas A.S. Koene
b
, Shelly N. Linssen
b,1
a
HEC Paris, 1, Rue de la libération, 78351 Jouy-en-Josas, France
b
Rotterdam School of Management Erasmus University, Burgemeester Oudlaan 50, 3062 PA Rotterdam, The Netherlands
a b s t r a c t
We study how mid-tier accounting ?rms deal with changes in their institutional environ-
ment that resulted in a shift in emphasis from the trustee logic to the commercial logic. We
?nd that these mid-tier ?rms selectively adopt practices related to the commercial logic,
while retaining a principal commitment to the trustee logic. Interviews with high level
informants in these ?rms show how speci?c strategic choice opportunities serve as inde-
pendent critical events framing practice-adoption decisions. Main strategic issues for the
mid-tier ?rms relate to the changing role of the accountant and changes in organizational
structure and practices. As these issues fundamentally challenge characteristics of their
professional identity, there is internal resistance against this transformation. Non-
partnered accountants mainly challenge new roles that upset their extant work routines,
whereas partners resist changes affecting their autonomy. These types of resistance
directly impact the strategic organizational responses of the accounting ?rms to institu-
tional pressures.
Ó 2012 Elsevier Ltd. All rights reserved.
Introduction
Over the past two decades the accounting profession
has come under increasing institutional pressure. Financial
globalization (Arnold, 2009) along with technical innova-
tions (Brock, 2006) and a broad shift towards neo-liberal
principles of market economics (Puxty, Wilmott, Cooper,
& Lowe, 1987) are changing the face of accounting. In re-
sponse, the accounting profession is changing with a lead-
ing role for the largest, multinational accounting ?rms
(Cooper & Robson, 2006) that have created a distinct trans-
national ?eld (Suddaby, Cooper, & Greenwood, 2007). The
big 4 ?rms developed a new, commercial business model
for their operations (Greenwood & Suddaby, 2006)
re?ected in their attitudes in the regulatory arena (e.g.
Cooper & Robson, 2006; Suddaby & Greenwood, 2005)
but also in the management of their professionals
(Covaleski, Dirsmith, Heian, & Samuel, 1998; Hanlon,
1996; Kornberger, Justesen, & Mouritsen, 2011).
For other (smaller) actors this has created a professional
?eld full of tension between the traditionally dominant
trustee – or ?duciary – logic and an increasingly pervasive
commercial – or corporate – logic (Dezalay, 1995; Hanlon,
1996; Thornton, Jones, & Kury, 2005). In prior studies of
processes of institutional change, scholars have pointed
to the importance of institutional tension based in the
incompatibility of competing institutional logics (Seo &
Creed, 2002; Thornton & Ocasio, 2008; Thornton et al.,
2005). Institutional logics re?ect the socially constructed
basis of ‘‘historical patterns of material practices, assump-
tions, values and beliefs, and rules by which individuals
produce and reproduce their material subsistence, orga-
nize time and space, and provide meaning to their social
reality’’ (Thornton & Ocasio, 1999, p. 804). They shape
how organizations and individuals behave and thereby af-
0361-3682/$ - see front matter Ó 2012 Elsevier Ltd. All rights reserved.http://dx.doi.org/10.1016/j.aos.2012.11.001
?
Corresponding author. Tel.: +33 1 39 67 97 08; fax: +33 1 39 67 70 88.
E-mail addresses: [email protected] (M.W. Lander), [email protected] (B.A.S.
Koene).
1
Consultant.
Accounting, Organizations and Society 38 (2013) 130–148
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j our nal homepage: www. el sevi er. com/ l ocat e/ aos
fect organizational structures and processes (Greenwood,
Diaz, Li, & Lorente, 2009). While logics are fundamental
and in?uential, organizational ?elds are rarely subject to
a single dominant logic. Rather, ?rms have to contend with
multiple, often contradicting logics that affect institutional
stability and change (c.f. Lounsbury, 2007; Marquis &
Lounsbury, 2007; Purdy & Gray, 2009; Reay & Hinings,
2005; Thornton, Jones, & Kury, 2005). The institutional log-
ics perspective thus moves beyond the basic constraining
nature of single logics, highlighting the ‘‘partial autonomy
of actors from social structure’’ (Thornton, Ocasio, &
Lounsbury, 2012, p. 7).
Following Lounsbury’s (2008, p. 354) lead we look at
how the recognition of ‘‘multiple logics, and thus multiple
forms of institutionally-based rationality . . .can provide
new insight into practice variation and the dynamics of
practice.’’ We do this through the documentation and anal-
ysis of the heterogeneity of organizational responses of
mid-tier accounting ?rms to the institutional pressures
facing the accounting industry. Where most studies exam-
ining institutional change focus on elite actors (Greenwood
& Suddaby, 2006) or mavericks (Leblebici, Salancik, Copay,
& King, 1991), the core of an organizational ?eld consists of
mainstream ?rms. The number of studies examining
change within this group has remained limited (Hardy &
Maguire, 2008). While studying the transformation of the
largest accounting ?rms into Managed Professional Busi-
nesses (MPBs; Cooper, Hinings, Greenwood, & Brown,
1996), Greenwood, Suddaby, and Hinings (2002) noted
that the regional and local ?rms in their study only had
modest sympathy for this new structure and were largely
indifferent to what these ?rms where doing. To some ex-
tent, the mid-sized ?rms de?ne themselves by how they
are different from the big 4. One of our respondents de-
scribed it as: ‘‘Saying that we want to look like the big 4 is like
swearing in a church!’’ (A3). We investigate the strategic re-
sponses (Oliver, 1991) displayed by mid-tier accountancy
?rms in the Netherlands in the face of con?icting demands
of the trustee and commercial logic.
These mid-tier ?rms present an interesting sample for
three reasons. First, although still quite large in size (both
in terms of employees and revenues), they are more
embedded in their local national institutional context (Ra-
mirez, 2009). They are, for example, more dependent on
national associations as sites of professionalization than
large professional ?rms that develop and provide much
of their training in-house (Cooper & Robson, 2006; Ramir-
ez, 2009). Second, our mid-tier organizations tend to
serve smaller, more local clients than the big 4. Hence,
they face different client demands (Ramirez, 2009). Third,
non-partnered professionals still have a great deal of
in?uence on the day-to-day operations of our mid-tier
?rms, given the relatively small size of the professional
cadre and the relatively easy access to the strategic apex
of the ?rm. Still, the increased importance of the commer-
cial logic has created a situation where the con?icting de-
mands of the commercial and the trustee logic ‘‘create
ambiguity and the concomitant need for sensemaking
about the implications of logic changes’’ (Thornton
et al., 2012, p. 7) also for our mid-tier ?rms. When exter-
nal expectations regarding con?icting logics are unclear
there is room for managerial discretion (DiMaggio,
1988; Oliver, 1991). It is therefore unlikely that strategic
responses to con?icting logics will be similar across all
actors populating an organizational ?eld (Pache & Santos,
2010). Given the relative paucity of empirical research on
the topic (Thornton et al., 2012), we investigate how our
mid-tier accounting ?rms deal with the two logics avail-
able for sensemaking and legitimation of choices regard-
ing the future course of their activities.
Besides the relevance to institutional theory, an analy-
sis of mid-tier ?rms also further illuminates our under-
standing of the evolution of professions. Essentially
sociological literature identi?es professions as occupa-
tions with special power and prestige, which were
granted a privileged position because they ful?lled spe-
ci?c societal needs and maintained norms through the
application of specialized bodies of knowledge and be-
cause they were ‘‘devoted to the service of the public,
above and beyond material incentives’’ (Larsson, 1977,
p. x). While institutional scholars in general do not ques-
tion the original ethical values espoused by the profes-
sions, authors in the sociology of professions literature
are much more skeptical, and some even question if this
focus ever really existed (cf. Abbott, 1988; Haskell,
1984; Larsson, 1977; Reed, 1996). Larsson (1977) for in-
stance argued that professionalization is mainly a process
of creating scarcity of resources in order to control the
market for expertise. In a related argument Abbott
(1988) saw professionalization as a way to create a
monopoly for skills and services. This critique of profes-
sional self-regulation overly driven by economics is simi-
larly heard in discussions about the consequences of the
development of large ?rms into more commercially ori-
ented ?rms (Wyatt, 2003). Discussing the tension be-
tween economic and professional motivation, Freidson
argues that although a shifting focus to pro?t is in itself
not unethical, the maximization of pro?t is (Freidson,
2001). According to Greenwood (2007) the original bal-
ance may have been disturbed to the detriment of profes-
sional behavior.
By exploring the ways in which the mid-tier accounting
?rms deal with the tensions between the traditionally
dominant trustee logic and the commercial logic, we make
three contributions. In relation to our understanding of the
professions, insight into the sources and motives for resis-
tance to certain structures and processes associated with
the commercial logic forms our ?rst contribution. While
our study is certainly not the ?rst to investigate resistance
to commercial practices in accounting ?rms (Covaleski
et al., 1998; Dirsmith & Covaleski, 1985; Hinings, Brown,
& Greenwood, 1991; Kornberger, Carter, & Ross-Smith,
2010), we do ?nd different motives underlying this resis-
tance in this group of ?rms. In part, we observe a frag-
mented and pragmatic implementation of elements of
the new logic as mid-tier ?rms select only those elements
that have the perceived potential to resolve concrete man-
agerial challenges regarding speci?c strategic issues. The
trustee logic thus continues to exercise its effect through
the embedded action of (managing) partners as well as
non-partnered accountants, whom are unwilling to forgo
their professional traditions and norms, because of their
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 131
vested interests, but also in order to maintain professional
standards in the client’s interests.
Second, we contribute to the literature on institutional
logics and change. Fundamental changes in environmental
conditions lead to organizational change (Romanelli &
Tushman, 1994). Within the accountancy sector, changes
such as increased regulation, automation of services and
changing client demands have recently punctuated a long
period of stability. These signi?cant environmental jolts
(Meyer, 1982) are hypothesized in prior literature to result
in revolutionary transformations of organizations rather
than their evolutionary development (Greenwood &
Hinings, 1996; Romanelli & Tushman, 1994; Tushman &
Romanelli, 1985). Yet, this is not what we observe in our
group of mid-tier ?rms. Our work on the micro-level
shows co-existence of old and new values and beliefs
(Brock, Powell, & Hinings, 2007) in the early phases of
institutional change in this segment of the accounting
industry. The mid-tier ?rms respond by addressing sepa-
rate and speci?c strategic and structural issues, as invoked
by the new logic. In their response they do not necessarily
draw on the new commercial logic, but on elements of the
logic that, for them, is most applicable to the situation at
hand. As such we ?nd a process of blending experimenta-
tion
2
where actors use ?eld logics as institutional toolkits,
a ?nding that bears close resemblance to Swidler’s ‘‘cultural
toolkit’’ argument (Swidler, 1986) and Thornton’s logics per-
spective where actors balance elements of multiple logics to
?t the particularities of a speci?c situation (Thornton, 2004).
Our work therefore offers insights in the early stages of the
organizational sedimentation process (Cooper et al., 1996)
related to ?eld level institutional change, rather than evi-
dence of a comprehensive transformational embrace or out-
right rejection of the structures and processes associated
with the novel commercial logic.
Our third contribution is to the literature on Profes-
sional Service Firms (PSFs) as we address the issue of gen-
eralizability of extant ?ndings to other (segments of)
professional ?elds (Von Norden?ycht, 2010). While
acknowledging that the big 4 have a profound in?uence
on the accounting profession and its regulation (Cooper &
Robson, 2006), the change in institutional logics and asso-
ciated practices (Greenwood & Suddaby, 2006) in these
?rms cannot straightforwardly be extrapolated to the
other actors in the accounting industry. While the big 4
?rms are dealing with multinational clients in a supra-
national arena, our mid-tier ?rms are well-established in
their national setting, engaging primarily with local clients
and experiencing greater in?uence of national professional
organizations (Ramirez, 2009). Our ?ndings indicate that
the commitment to the traditional trustee logic is consid-
erably stronger within this group of more locally grounded
?rms. Thus, Greenwood and Suddaby’s (2006) ?nding that
a group of elite ?rms pushes a comprehensive and consis-
tent agenda propagating the commercial logic does not
translate to the group of mid-tier ?rms. This suggests that
organizational responses to con?icting or changing logics
may differ systematically across the different demographic
strata into which organizational ?elds tend to be seg-
mented (Ramirez, 2001).
Theoretical orientation
Shifting institutional logics
The accounting industry has always faced contradicting
expectations from a professional and a commercial logic.
Yet traditionally the professional trustee logic (Suddaby
& Greenwood, 2005) in which professional values and a
feeling of societal guardianship is central to the profes-
sional identity was dominant. Professional audit practices
are the core of the accountants’ activities and as these
activities mean applying an esoteric body of knowledge
to complex problems, they enjoy high levels of discretion
and autonomy (Greenwood, Hinings, & Brown, 1990).
Additionally, senior members, who typically own and
manage the ?rms, are responsible for their particular prac-
tice areas and hence place priority hereon. In practice this
means that the strategy of the ?rm can be described as the
aggregate of the partners’ individual interests (Pinnington
& Morris, 2003). In terms of organizational systems and
practices, these ?rms rely primarily on informal and colle-
gial control mechanisms at the expense of more formal and
hierarchical systems (Greenwood et al., 1990).
However, recently the accounting industry experienced
a number of upheavals that challenge traditional profes-
sional practice and the centrality of the trustee logic. First,
computer aided audit systems have reduced the complex-
ity and labor intensity of the audit process (Brock, 2006). In
the Netherlands, the introduction of a standardized soft-
ware language XBRL results in increased ef?ciency and
ultimately less billable hours in the consolidation practice
(ING Economic Bureau, 2010). On the client side, the in-
creased emphasis on costs and the internet and mobile
technologies that allow for shopping around, adds to the
pressure on audit fees (Ahroni, 1999). Second, due to glob-
alization, accountancy organizations now have to deal with
international standards and needs of their international
clients (Nachum, 1996). This brings new knowledge
requirements for accountants and challenges in the local
integration of global standards (Botzem & Quack, 2009).
Third, statutory protection for providing services has been
reduced or removed (Hart, Schlesinger, & Maher, 1992).
This results in growing intra- and inter-professional com-
petition (Gray, 1999). Fourth, the Sarbanes-Oxley act has
also induced changes in the organizational structure of
accounting ?rms (Greenwood & Suddaby, 2006), increas-
ing organizational process controls and reducing the
importance of the individual accountant. In the Nether-
lands, for those ?rms that perform statutory audits of an-
nual and consolidated accounts, the Wet toezicht
accountantsorganisaties (Wta; law on the supervision of
accounting ?rms), has been implemented. This law entails
that accountancy ?rms require permits for statutory
audits, the allocation of which is determined by a number
of stringent quality demands. This has led to a decrease in
the number of ?rms allowed to conduct audits. The Wta
has created a large barrier of entry as the costs of these
2
This termed was suggested by one of our reviewers.
132 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
permits are signi?cant. There are the direct costs of obtain-
ing and maintaining this permit as well as indirect costs
stemming from the investments ?rms have to make in
their quality systems (ING, 2010). Finally, ?rms face
changes in client demands. Clients are not only more crit-
ical towards the service they receive, but also demand
more and different services, i.e. full service advice (ING,
2010). As such, the role of the traditional accountant is
slowly being shifted towards that of an advisor to the ?rm
(Ramirez, 2009).
The accounting profession at crossroads
These developments shift the control over professionals
from the professionals to market competition and hierar-
chical control through management in organizations (Han-
lon, 1996, 1997). This directly weakens the effects of social
closure and economic monopoly, two important historical
foundations for maintaining the professions. Social closure
is the process by which jurisdictional boundaries are
drawn around a particular set of knowledge and skills to
make it possible for a profession to ensure quality and
competence by providing special educational credentials.
Economic monopoly both ensures the quality of the profes-
sion as well as the discipline of its members by muting
competition (Freidson, 2001). Related, economic monopoly
ensures the development and maintenance of quality be-
cause it allows the professions, for instance, to set tariffs
and entry barriers and prohibit advertising (Freidson,
1984; Suddaby et al., 2007). While the accounting industry
has always faced con?icting demands from the profes-
sional and the commercial logic, the aforementioned
changes pushed accounting ?rms to rationalize their ser-
vice delivery process replacing the traditional partnership
form by the MPB form (Cooper et al., 1996), which empha-
sizes the ef?ciency of structures and processes. Addition-
ally the large accounting ?rms broadened their activities
to consultancy services (Greenwood & Suddaby, 2006).
This has led them to forego their professional indepen-
dence (Covaleski, Dirsmith, & Rittenberg, 2003) and an
emphasis on the application of expertise in the interest
of public service (Pinnington & Morris, 2003) for the con-
cept of value added (Covaleski et al., 2003; Pinnington &
Morris, 2003). Following the shift to a more commercial lo-
gic the large accounting ?rms also developed more deliber-
ate management practices. To assure ef?ciency and avoid
strategic drift (Lorsch & Tierney, 2002) the large account-
ing ?rms introduced formal strategic planning and gover-
nance, emphasized marketing and work with centralized
?nancial systems (Morris & Pinnington, 1998).
Institutional dynamics and strategic responses
Changing institutional demands naturally result in a
changed organizational ?eld. On the ?eld level, the litera-
ture on institutional logics shows four possible outcomes
of the clash between logics: the incorporation of elements
of a new logic into the dominant one (e.g. Glynn, 2000), the
hybridization of elements of both the old and new logic
(e.g. Colyvas & Powell, 2006; D’Aunno, Sutton, & Price,
1991; Purdy & Gray, 2009), a shift from the old dominant
logic to the newly introduced logic (e.g. Thornton, 2002;
Zilber, 2002) or the permanent co-existence of both logics
(e.g. Lounsbury, 2007; Marquis & Lounsbury, 2007; Reay &
Hinings, 2005, 2009; Scott, Ruef, Mendel, & Caronna, 2000).
While in these studies the effects on the macro-level are
evident, the processes by which micro-level dynamics lead
to these outcomes are rarely investigated. Oliver (1991, p.
145) points to the lack of ‘‘attention to the strategic behav-
iors that organizations employ in direct response to the
institutional processes that affect them.’’ Drawing on insti-
tutional and resource dependence theory she describes
how organizations within the ?eld react and behave. To
cope with institutional demands ?rms can employ ?ve dif-
ferent strategic responses: (1) acquiescence, organizations
accede to institutional pressures; (2) compromise, organi-
zations seek a balance to manage inconsistencies between
institutional expectations and organizational objectives;
(3) avoidance, organizations try to preclude the necessity
of conformity; (4) de?ance, organizations actively resist
institutional expectations; and (5) manipulation, organiza-
tions actively try to rede?ne the institutional expectations.
Following the publication of this seminal work, a produc-
tive research stream developed to uncover which strategic
responses are employed by ?rms in various settings.
However, in most studies, authors discuss ?rm re-
sponses to changes in speci?c institutional practices rather
than wholesale shifts between logics. Additionally, the
possible responses of these ?rms are generally limited to
acquiescence/adopt or de?ance/non-adopt of a speci?c
practice. For example, adoption or resistance has been
investigated for cesarean surgeries (Goodrick & Salancik,
1996), university recycling programs (Lounsbury, 2001),
divisionalization (Thornton, 2002), issue management
practices (Greening & Gray, 1994), work family issues
(Milliken, Martins, & Morgan, 1998), and TQM systems
(Westphal, Gulati, & Shortell, 1997). In a signi?cantly smal-
ler set of studies, authors went beyond the dichotomy of
adoption/non-adoption and directly investigated all ?ve
strategic responses, however again these studies focused
on single practices, rather than broader shifts in logic
(e.g. Goodstein, 1994; Ingram & Simons, 1995).
Several in-depth case studies look at ?eld level changes
in institutional logics, but in these studies the simultaneity
and congruence of strategic responses by ?rms are
implicitly assumed rather than formally investigated (e.g.
Hoffman, 1999; Townley, 2002). Thornton et al. advocate
further study of the effects of macro-level logics on the mi-
cro-dynamics arguing the simultaneous existence of multi-
ple institutional logics and addressing the need to further
investigate how logics relate to changes in identities and
practices (Thornton et al., 2012).
A review of accounting research points to a similar lack
where research on ‘‘practice’’ development has been extre-
mely fruitful but ‘‘has tended to ignore broader institu-
tional dynamics in favor of more micro-processual
studies of how accounting systems shape and are shaped
by intra-organizational dynamics’’ (Lounsbury, 2008, p.
356). For example, studies of large accounting ?rms show
the importance of the new role of managers for the
advancement of the commercial logic. Kornberger et al.
(2011) point out howin these ?rms the role of the manager
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 133
serves as a ‘rite of passage’ in the corporate career where
individuals learn to navigate a complex network of multi-
ple players in a new role connected to the ongoing ratio-
nalization and economization of the ?rm. In similar vein,
Covaleski et al. (1998) as well as Dirsmith et al. (1997)
highlight how management by objectives threatens the
core professional characteristics of autonomy and partner
discretion and how they subsequently subvert, transform
and bend the practice.
While investigating such speci?c practices is important
as they invariably alter professional identity, we are inter-
ested how mid-tier ?rms adapt their whole portfolio of
structure and processes in view of the growing importance
of the commercial logic. Besides documenting the organi-
zational responses of mid-tier accounting ?rms, we are fur-
ther interested in their underlying rationale for the
demonstrated strategies. In previous studies authors show
that encroachment on professional autonomy has been a
strong driver for resistance against novel practices. They
also show that organizational members differ in their opin-
ions with regard to these practices (Covaleski et al., 1998;
Dirsmith et al., 1997; Hinings et al., 1991). Recently, Pache
and Santos (2010) have argued that the type of strategic re-
sponse given by ?rms is not solely determined by external
forces but rather by the internal representation of these
external forces. Their study highlights the importance of
perceptions of the existing internal audiences of the rele-
vant external forces and the logics by which they operate
(Friedland & Alford, 1991). We further investigate this
diversity in opinions by evaluating how attitudes towards
strategic responses differ between partnered and non-
partnered accountants in our mid-tier accounting ?rms.
In this study we thus investigate how mid-tier account-
ing ?rms deal with the multiple, con?icting logics available
for identity formation and practice development in their
?eld of accounting practice. We speci?cally address how
intra-organizational representation of these logics takes
shape and affects ?rms’ responses to the main strategic
challenges in the ?eld.
Methods
Rationale
The aim of this research is to elaborate our current the-
oretical understanding (Lee, Mitchell, & Sablynski, 1999) of
the impact of multiple institutional logics and the hetero-
geneity of organizational responses. Similar to Greenwood
and Suddaby (2006) we use inductive reasoning to map
organizational responses to institutional pressures as per-
ceived in the demographic of mid-tier accounting ?rms.
In order to document ‘‘changes in structures and systems’’
and ‘‘the ways in which these changes coincide with insti-
tutional templates’’ large scale comparative studies are
necessary (Greenwood & Hinings, 1996, p. 1047). They
are necessary as changes involve dif?cult to measure con-
cepts (e.g. resistance) and radical changes take lengthy
periods of time. Hence we opted for a qualitative, multiple
case study (Eisenhardt, 1989) and use event sequencing of
historical and contemporary processes (Lee et al., 1999)
within and between cases. In order to disentangle the pro-
cess of organizational change we draw on interview and
archival data.
Research context: The Dutch accountancy sector
The accountancy ?rms included in the sample are
drawn fromthe 22 largest accountancy ?rms listed directly
behind the big 4 ?rms. In terms of size (turnover and num-
ber of full-time employees) mid-tier ?rms differ substan-
tially from the big 4 accounting ?rms. In the ranking of
largest accounting ?rms in the Netherlands the big 4 are
followed by three ?rms with pro?ts in excess of €100 mil-
lion and employing over 1000 fte. The following six ?rms
have over €50 million in pro?ts and employ over 500
employees. Finally, the remaining 13 mid-tier ?rms have
pro?ts in excess of €15 million and employ more than
150 employees (www.accountant.nl).
Data sources
We de?ne our sample geographically, which is a tried
and tested sampling method for professional organizations
whose operations are contingent on the jurisdiction in
which they are active (Greenwood & Suddaby, 2006; Ruef
& Scott, 1998) Our data was collected from 2009 to 2011,
under the jurisdiction of the Nederlandse Beroepsorganisa-
tie voor Accountants (NBA; Dutch Accounting Association).
Our primary sources of data are interviews with 34 se-
nior-level informants within 11 mid-tier accounting ?rms
in the Netherlands with turnover ranging from €17.4 to
215.7 million and 161 to 1950 employees (see Table 1).
Our informants were theoretically sampled on a number
of characteristics (Corbin & Strauss, 2008). First, the infor-
mants needed to have insight in the strategic plans of the
?rms. Preferably – and most of our informants were –
the informants needed to be (managing) partners and as
such have decision making authority. Secondly, the infor-
mants represented the different service areas of the ?rm
such as the audit branch, the consolidation branch and
the ?scal branch.
As we study con?icting institutional logics we are tap-
ping into cognitive aspects such as perceptions, thought
and interpretation. Therefore, we are at the risk of several
biases (Miller, Cardinal, & Glick, 1997). In order to mitigate
subject biases, we used multiple informants (at least three,
save for one ?rm where only the managing partner con-
tributed to the study) per ?rm. The added bene?t of using
multiple informants is that it often results in richer data
(Schwenk, 1985). In the ?rst instance, the managing part-
ner or director was contacted and informed about the
study’s objectives and asked to participate in an interview.
Subsequently, using snowball sampling (Kerlinger, 1986),
we asked the ?rst informant to specify at least two other
potential informants. The interviews ranged from one to
one and a half hour in length. We always started by asking
for background information on the ?rm as well as the
informant. Hereafter, open-ended questions were used to
elaborate on ?ve important forces for change in the
accounting industry. Open-ended questions lead to higher
accuracy in reports (Miller et al., 1997). Examples of ques-
134 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
tions are: ‘‘What are the ?ve most important changes in
the ?rm’s environment that led to changes in the mindset
of the ?rm?’’; and ‘‘Why were these changes seen as
important in the ?rm?’’ Subsequent questions were used
to uncover the effects of these forces on the strategy and/
or structure in the last 5 years within the informants’ ?rm.
Example questions are: ‘‘What were the in?uences of these
changes on organizational structures and practices?’’;
‘‘What is the best response to the changes for your ?rm
in terms of strategies, structures and practices?’’; ‘‘Why
was this response (not) chosen?’’ and; ‘‘Was there any
resistance to the changes in the ?rm?’’ All interviews were
recorded and transcribed. The total number of transcribed
pages amounted to 1400 double-spaced pages. In order to
minimize retrospective bias (Miller et al., 1997), we asked
informants to re?ect on real time and retrospective change
or non-change events. This motivated informants to tell
their story on (non-)changes in their ?rm and the substan-
tiation of accounts through instructive examples. We also
provided anonymity for both the informants as well as
the ?rms they represent to encourage openness with re-
gard to the strategic responses of the ?rms (Miller et al.,
1997). As our informants were at the heart of organiza-
tional decision making, they were exceptionally knowl-
edgeable and reliable regarding the events they were
asked to describe (Kumar, Stern, & Anderson, 1993; Seidler,
1974). Subsequently, we compared responses of the multi-
ple informants of a ?rm on these change issues. Substantial
differences between the accounts of informants of the
same ?rm would indicate retrospective biases or an unre-
liable interview protocol. In fact, we did not ?nd signi?cant
difference between the instructive examples of respon-
dents of the same ?rm (Seidler, 1974).
With this approach our 34 informants provided a suf?-
ciently rich sample, for three reasons. First, informants
were high-level ?rm members and therefore very suitable
for our objective. Second, together the studied organiza-
tions represent 50% of the mid-tier ?rms in the Nether-
lands. Third, in the ?rst three ?rms we investigated, we
interviewed four respondents. However the added value
of the last interviews, in terms of additional insights, was
limited; we felt saturation was reached. Given the above
and the fact that respondents indicated that these inter-
views meant a signi?cant time investments on their part,
we decided to limit the number of informants to three
per ?rm if data saturation was reached. At this point we
must make one caveat. Within-?rm consistency in our
informants’ answers may, in part, be the consequence of
our sampling method. While snowball sampling is a com-
mon method for obtaining informants, a possible disad-
Table 1
Informant information.
Firm/informant number Informants
A1 Turnover = € 215.7 million CEO (20 years at ?rm)
A2 National senior manager (3 years at ?rm)
A3 # FTE = 1950 Managing partner (8 years at ?rm)
A4 OOB licensed Regional managing partner (25 years at ?rm)
B1 Turnover = € 115.5 million Regional managing partner (7 years at ?rms)
B2 Managing partner audit (9 years)
B3 # FTE = 1160 Managing partner accountancy (2 years at ?rm)
OOB licensed
C1 Turnover = € 111.7 million Senior policy maker HR (5 years at ?rm)
C2 Regional managing partner (9 years at ?rm)
C3 # FTE = 1280 Director general business affairs (15 years at ?rm)
D1 Turnover = € 97.2 million National managing partner (28 years at ?rm)
D2 Regional managing partner (12 years at ?rm)
D3 # FTE = 866 Managing partner (12 years at ?rm)
D4 OOB licensed National managing partner and member of the board (21 years at ?rm)
E1 Turnover = € 68.8 million CEO (6 years at ?rm)
E2 Managing partner and member of the board (40 years at ?rm)
E3 # FTE = 756 Partner (2 year at ?rm)
F1 Turnover = € 59 million Senior relations manager (1 year at ?rm)
F2 # FTE = 636 Regional manager tax and international affairs (11 years at ?rm)
F3 Regional manager accountancy (21 years at ?rm)
G1 Turnover = € 53.5 million Managing partner and international representative (9 years at ?rm)
G2 National managing partner and member of the board (29 years at ?rm)
G3 # FTE = 465 Managing partner (18 years at ?rm)
G4 OOB licensed Managing partner (22 years at ?rm)
H1 Turnover = € 43.3 million Managing partner audit (15 years at ?rm)
H2 Managing partner accountancy (16 years at ?rm)
H3 # FTE = 476 Compliance of?cer and director of education (8 years at ?rm)
I1 Turnover = € 29.6 million Senior Manager (3 years at ?rm)
I2 Managing partner audit, member of the board (5 years at ?rm)
I3 # FTE = 293 Director Audit (13.5 years at ?rm)
J1 Turnover = € 21.3 million Managing partner (1 year at ?rm)
# FTE = 161
K1 Turnover = € 17.4 million Regional managing partner (6 years at ?rm)
K2 Regional managing partner (16 years at ?rm)
K3 # FTE = 180 Regional managing partner (3 years at ?rm)
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 135
vantage is that the principal informant will refer to like-
minded additional informants. The resulting community
bias could limit the diversity of generated responses and
ultimately wrongfully anchor organizational responses.
While we cannot rule out some level of bias we feel our
?ndings are valid ?rst, as we asked informants to describe
concrete examples of change and non-change events
which allow informants to tell their story and second we
used secondary data sources for validation of the change
events that our informants described in order to ascertain
their accuracy, and mitigate potential subject bias (Jick,
1979). Archival data on both changes in the industry and
changes within ?rms were consulted when available. We
used three different kinds of archival information. First,
we used annual reports (2008–2010) of the professional
accountancy association in order to determine key trends
as well as important legislative changes within the accoun-
tancy industry. Secondly, we perused the companies’ web-
sites to uncover any press releases (from 2008 to 2011) for
descriptions of major changes the ?rms have gone through.
Finally, we used information drawn from industry journals
(e.g. Maandblad voor Accountancy and Bedrijfseconomie
(MAB; Monthly journal on accountancy and business eco-
nomics)). Information herein was analyzed after the inter-
views were held and was used to supplement both the
information on forces for change in the ?eld, as well as
changes that were initiated by various actors in the ?eld.
These data were primarily used to corroborate the infor-
mation drawn from the interviews however at times it
was used to supplement our data.
Data analysis
The data analysis had both a planned and emergent
character. During the analysis the authors shifted back
and forth between raw data and theory in order to make
sense of the effect of con?icting logics on organizational re-
sponses (Glaser & Strauss, 1967). In doing so, we focused
on three basic questions: (1) what forces for change are
mentioned by the ?rm; (2) what elements of the ?rm did
these pressures in?uence; and (3) what were the organiza-
tional responses given by the ?rm? The process involved
two distinct steps.
Stage 1. Case studies were written for each of the ?rms
in the sample based on informant quotes as well as archi-
val data (Graebner, 2009) and varied in length between 20
and 40 pages. In these case studies, ?rst, the drivers of
institutional change that resulted in con?icting institu-
tional logics were coded. Following common inductive
processes, we went from broad generic classi?cation of
the issues related to the questions above in the ?rst coding
round, to more speci?c categories in coding round two
such as drivers stemming from rules and regulation, or
automation of processes. These drivers were subsequently
analyzed for their relation to the two existing institutional
logics. However, as it is dif?cult to empirically identify
institutional logics we followed Jarzabkowski, Matthiesen,
and Van de Ven (2009) by searching for indicators of these
logics in our data. We looked in particular for evidence of
norms, beliefs and values associated with each of these
logics such as quality standards and professionalism for
the trustee logic and ef?ciency and pro?tability for the
commercial logic. For the organizational points of conten-
tion we open-coded ?rst for broad categories (e.g. accoun-
tant to advisor, organizational governance, etc.). These
broad categories were speci?ed to the particular issues
pertaining to that category (i.e. for organizational gover-
nance: background management & decision making).
When coded, these organizational points of contention
could be grouped in two categories (Table 2) of strategic
themes for our mid-tier ?rms: (1) the changed role of the
accountant; and (2) changes to the organization’s structure
and practices.
In the third round we looked for speci?c examples of
the categories. For example, for organizational governance,
the authors coded whether a ?rm engaged in directive or
consensus decision making.
The ?nal step in writing the individual case studies was
coding the organizational responses (Oliver, 1991) to each
of the organizational points of contention. We excluded
the avoidance strategy, as in all our cases the ?rms en-
gaged with at least one of the logics legitimating their
praxis. If ?rms continued to comply with the demands of
the professional/trustee logic, they acquiesce to these de-
mands. If they felt that they needed to reconcile demands
from both logics, ?rms are assigned the compromise strat-
egy. If ?rms chose to follow the new commercial logic on a
particular issue, they are assigned the de?ance strategy as
they are defying the old logic. Finally, if ?rms went beyond
what was demanded by the commercial logic, we classify
their strategy as manipulation, as they are trying to change
the logic to their standards.
Independent of each other, two authors coded these re-
sponses and tactics in order to ensure consistency. The
interrater reliability score was .84, indicating good reliabil-
ity (Cohen, 1968). When assigned responses differed, the
authors discussed and determined the appropriate coding.
Table 3 provides the coding scheme for ?rm A document-
ing the various strategic responses for speci?c strategic
issues.
To investigate internal representation we coded for two
clusters of representation. In professional accounting ?rms,
internal representation seems to be particularly salient
with professionals who have been socialized in their pro-
fession and are committed to maintain its values, mainly
based on the long established trustee logic. To capture
the impact of internal representation, we coded for two
groups: non-partnered accountants and accountants who
were partners of the ?rm.
Stage 2. Once all case studies were written and coded,
we conducted a cross-case analysis (Eisenhardt, 1989).
This cross-case analysis served two purposes. First, by
comparing the perspectives of the ?rms, we established
an overview of the institutional pressures on these ?rms
that could be related to the trustee logic or the commercial
logic. This overview is presented in the ?rst part of our
?ndings section.
Secondly, we analyzed the strategic responses to insti-
tutional pressures of the ?rms in our sample for the main
strategic issues identi?ed. In addition to the executed
strategy, we also looked at the reasons the informants gave
136 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
for their particular strategy. The outcomes of this analysis
are presented in the second part of our ?ndings.
Findings
Multiple logics, con?icting demands
For the mid-tier accounting ?rms, we see that there is a
clash of logics and that the drivers of this clash place diver-
gent demands on the organizations. In the next section we
describe how con?icting demands produce heterogeneous
responses. Table 4 shows how both logics relate to the
main drivers of change (strategic challenges).
Trustee logic. The original trustee logic (Thornton et al.,
2005) places emphasis on professional values and techni-
cal expertise of the accountants. Following this logic, all
organizational systems should be geared to accommodate
these demands. Firms deliver a narrow range of profes-
sional auditing-related services, around which the ?rm is
organized. Consensus decision making is the norm and
Table 2
Organizational change categories.
Role of the accountant Organization
Accountant to advisor Organizational governance
Core business(consolidation-advise) Background management/board members
Training Decision making/voting (all-directive)
(Advisory) services Performance pay system
Formal business development Division pro?ts
Range of services, specialist concept Evaluation functionality
Client acquisition (reactive–proactive) Organizational structure
Cold acquisition (Merging) number of locations
Automation of services Critical mass
Portals/online service Separation audit and advisory
XBRL Service lines
Staff services
Internationalization
Network
Clients/services
Table 3
Organizational response strategies and tactics.
Examples of strategies for organization A Strategy Quote
Role of the accountant
Accountant to
advisor
Core business De?ance R1: Yes, we are trying to increase the number of advisory products
Training Manipulate R1: We have created a bachelor in cooperation with a university to train our people
to be able to advise clients
(Advisory) services Formal business
development
De?ance R2: We have hired a business manager, and with him a strategy for new product
development mainly related to automation
Range of services,
specialist concept
De?ance R2: We want to provide business through a full service concept, but also want to hold
on to the bottom of the market
Automation of
services
Portals/online service Manipulate R1: We are way ahead in terms of web based access. We give presentations on it, to
show that
XBRL Compromise R3: We do too little. However, it is a key point for us to increase ef?ciency in the audit
Organization
Organizational
governance
Background
management/board
members
Acquiesce R1: A non-professional needs to be very good to be accepted by a professional, I
doubt we would accept a non-professional at a similar level
Decision making/
voting
Compromise R1: I would be in favor of more directive decision making, but you need to know
when you are directive or when you need to convince
Performance pay
system
Division pro?ts Acquiesce R2: Another sore spot is the reward system. Everyone gets the same based on a point
system, but we do not have a differentiated performance pay system
Evaluation
functionality
De?ance R2: Our performance system has criteria such as how good are you with your clients,
what is your pro?tability and how satis?ed are your people
Organizational
structure
(Merging) number of
locations
Acquiesce R3: It has been debated whether to merge locations, however a lot of people were
against it
Critical mass De?ance R2: You need a large club to get scale advantages from you IT investments, as well as
being able to specialize
Separation audit and
advisory
Acquiesce R3: Our ?rm still has a mixed practice, so we did not separate audit and advice
Service lines Compromise R1: It is a matrix structure organized geographically and through service lines
Staff services De?ance R1: We have staff services with their own directors, who all report to one partner
Internationalization Clients/services De?ance R1: Being in an international network allows you to service your clients in a uniform
manner
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 137
decision making is done at the local of?ces. Pro?ts are
shared and accountants and partners are not directly held
accountable for their ?nancial performance (Greenwood &
Suddaby, 2006). The issue of accountability is directed
mostly towards professional norms and values and the
quality of the auditing practice.
Several of the pressures faced by the set of mid-tier
?rms support these values. The more stringent rules
and legislation put forward by the professional
associations as well as the government reinforce the
importance of the technical qualities and ?duciary
responsibilities of the accountants. If these quality stan-
dards are not met, permits to conduct audits of annual
accounts will not be provided. Two such permits exist,
of which the OOB-permit for organizations of public
importance (i.e. banks, public ?rms, as well as stock-
listed ?rms) sets the most stringent demands. The ‘nor-
mal’ permit allows accounting ?rms to audit organiza-
tions that exceed the threshold for mandatory
deposition of annual accounts. These pressures forced
?rms to invest in quality systems. Coupled to the assur-
ance of quality through legislation is the automation of
the processing of invoices as well as through the
introduction of XBRL systems, which provide real-
time information on the company’s ?nances. XBRL out-
put is increasingly requested by banks when deciding
to provide loans. Clients also stimulate the trustee logic
as they increasingly demand that their accountants are
available and knowledgeable on their particular situation,
as well as locally present. This requires generalist
knowledge on the part of the accountant, local
decision making capabilities and a large number of local
of?ces.
Commercial logic. Although froma trustee logic perspec-
tive the drivers of change demand a focus on, and an
investment in the attainment of high quality standards,
they at the same time force ?rms to be more commercially
oriented. The investments in quality systems as well as in
automation systems and XBRL demand a certain scale
within the organization in order to make investments
lucrative. This however puts a strain on existing practices
such as collegial decision making and local presence.
Additionally, when the core product of the accountant,
the consolidation of annual accounts, becomes automated,
the corresponding pro?t margins drop signi?cantly. As a
result, the accounting ?rms seek other sources of revenue.
We observe that most ?rms start developing specialized
advisory services. This shift to more advice type of services
is also demanded by the clients. Clients want to be advised
on ways to improve their bottom line. This again stimu-
lates the formation of advisory services. Additionally,
international ?rms demand their mid-tier accounting ?rm
to venture internationally, which brings about new sets of
control and performance management processes to im-
prove coordination, at the expense of collegial con-
trols present under the trustee logic. Finally, the
economic crisis has also impacted the mid-tier accounting
?rms directly, forcing them to proactively approach clients
and provide a broader range of services with higher pro?t
margins.
Organizational responses to con?icting demands
The two logics thus present contradicting demands on
how ?rms should organize themselves in terms of strategy,
structure, systems and processes. Our data show that the
balance between these views differs between organiza-
tions and between strategic issues. This leads to different
organizational responses on speci?c strategic issues. These
?ndings will be discussed next. We sequentially analyze
organizational responses to the strategic issues around
the two main themes: the changing role of the accountant
and the implications for organizational structure. Our ?nd-
ings show that organizations are not consistent in their
choice of strategic responses. Rather for each strategic
choice, the ?rms make a separate evaluation of what logic
to follow.
At times, organizations are not able to conduct the
strategy they want because of internal resistance. Consid-
ering the two clusters of internal representation we there-
fore also analyzed how our respondents position partners
and non-partners towards the different strategic issues,
thus identifying the locus of resistance towards institu-
tional change.
The changing role of the accountant
Changes in government legislation have, besides forcing
the mid-tier accounting ?rms to focus on quality, also
introduced elements of free-market competition the indus-
try. Additionally, diminishing revenues from their core
business (consolidation and auditing of annual statements)
due to technological improvements and changing client
demands, force the mid-tier ?rms to change. Clients now
expect their accountants to advise them on how to im-
prove their business. Related to this changing role, our data
show that the ?rms need to decide: (1) to which degree
and how do they want to make the transition possible;
(2) what services they want to deliver; (3) how much effort
they place in client acquisition; and (4) how heavily they
invest in automation of their services. Table 5 provides
an overview of ?rm responses with regard to the changing
role of the accountant. In general there are in three groups
of ?rms that can be clustered together based on their incli-
nation to adopt practices from the new logic.
Almost all ?rms recognize that, as their core business is
changing, the role they play as an accountant also has to
change. They try to do this in two ways. First, almost all
?rms – except for ?rms D and K – express the need to auto-
mate the process of creating annual accounts. Although
they continue to see this part of their work as important,
it is no longer the main source of income. Hence it needs
to be as ef?cient as possible. As one respondent illustrated
his ?rm’s de?ance strategy:
‘‘We have digitalized the consolidation department. It is
really an assembly-line idea. The creation of annual
accounts needs to be ef?cient. This together with advisory
services is essential. Both need to be perfect, it is not that
one is less than the other, but you just need to automate
those things that can be made more ef?cient’’ H1.
138 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
Table 4
Drivers of strategic change and their effects according to the trustee and commercial logics.
Example quotes Effect according to
trustee logic
Drivers Effect according to commercial
logic
Example quotes
E1: Regulation for accountancy
?rms has changed to such as
extent that we have made our
audit branch a separate
entity. Responsibilities and
duties are such that they are
in line with AFM demands.
We have increased our quality
we now have tighter
procedures
More stringent
certi?cation demands
place emphasis on
quality controls and
professional values
Rules and
regulation
The increased quality demands
requires ?rms to invest in quality
systems and controls, this
requires suf?cient size (critical
mass) to make this worthwhile
E1: The investment in quality
due to increased regulation has
cost us tons of money and had a
tremendous impact on the
organization
K2: Introducing a quality system
costs money and as a result you
need to expand
F3: When you look at the
regulatory changes, this has
had a tremendous impact on
the internal organization of
the ?rm
D1: This forces us to send
?nancial messages via the
internet at an agreed
standard. A few years ago, the
government forced us to sign
a covenant to deliver ?nancial
statements in XBRL format
Automation and standard
reporting language
systems place emphasis
on quality controls and
professional consistency
Automation
and XBRL
Automation and standard
reporting language systems
reduce pro?ts from core product,
the annual statement, forcing
accounting to engage in different
services
B2: Another big change has of
course been technology. The
invoice processing, which we
used to do in the past is
disappearing because of
computers. This means we need
to change our business model
from making ?gures to
explaining them. When you go
from producing to explaining
?gures; that demands a different
skill set
E1: XBRL should reduce the
administrative burden by being
able to quickly connect with the
banks, tax authority and
chamber of commerce. This
should really improve ef?ciency
and is a very exciting
development
A1: We have an international
network that others do not
have, but we also have a
personal approach that ?ts
our customer segments. They
demand this of us
Clients demand local
presence and generalist
approach of their
accountant
Client
demands
Clients not only demand an
annual statement, but also
advice on how to improve their
performance. Additionally
international clients demand
international services
C1: Clients have less interest in
looking back, they have got that
covered with their bookkeeping
software, what they seek is a
partner in business that will help
them look forward
H1: Our clients want their
accountant close by, so that if
something goes wrong you
can quickly react. Because we
know the local network we
can help in all sorts of ways
F2: Clients are no longer
interested in the annual
statement; they are interested in
what they can do with those
?gures
Economic/
market
conditions
The dire economic situation in
general and the dif?cult market
conditions in the accounting
sector in particular have pushed
?rms to place emphasis on new
business generation and
development, ef?ciency and
change in services
C2: Well what you see is that the
crisis actually ensures change
takes place automatically; you
end up with lower pro?ts so you
need to do something.
J1: I think the accountancy
market will continue to
consolidate. It is very scary as it
looks like there is overcapacity
on the supply side
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 139
The primary reason why ?rms differ with regards to the
extent in which they embrace the new role of the account
lies in the value they attach to the old role. During the
interviews, it became clear that strategies in relation to
the changing role of the accountant were often adapted
in the face of internal resistance by non-partner accoun-
tants and in some cases by partners. This is illustrated in
Table 6.
Firms B, C, E, G, H and I are somewhat between logics, as
they perceive the need to change their service portfolio but
develop it in an ad hoc manner with their core service, the
consolidated account, as basis for these advice services.
They also have not yet developed specialized services to
any great extent, although some specialized services for
speci?c industries are present. Respondents from these
?rms emphasize the need to limit their diversi?cation to
competencies within the accountancy profession:
‘‘[The advisory services] are clearly ?nancial and accoun-
tancy related. Risk management, insurance, independence,
integrity, those are the most important elements, so we
clearly do not see ourselves as a consultancy ?rm’’ D4.
‘‘At one point you lose your way. You end up offering a type
of service of which you think ‘what has that got to do with
accountancy?’ That’s what you see happening with the big
4. . .I think it is important that you can still see a clear link
with the original professions. Management consulting is
something completely different. I think it’s dangerous’’ G3
‘‘You have to offer things you are good at. We are good
with numbers, so offer services involving numbers. The
question is do we really know anything about strategy?
Is that part of the job of an accountant? What are the bor-
derlines? I think every ?rm can make its own decision, but
we try to re?ect if we are not moving to far away from our
core qualities’’ H3.
However, most also indicate that their accountants ‘‘in
general resent change and if it where up to them, in ten years
time they would still do the same thing’’ (H3), and that
‘‘change leads to fear and fear leads to resistance’’ (E1). They
describe them as ‘‘used to looking to the past not the future’’
(C3), preferring ‘‘not to have too much contact with dif?cult
clients’’ (K2) and in general question what this change
means for them. Therefore, these ?rms offer their accoun-
tants training options to provide them with the necessary
skills and prepare them for change. However, a number
of respondents indicate the transition is a lengthy process.
Firms A, F, and J – have fully embraced the new role.
They invest heavily in developing new products; offer a
wider range of services, complemented with industry spe-
ci?c or product speci?c specialized services. To achieve
this, they sidestep the accountants who stick to their old
role:
‘‘However, we do this with a lot of non-accountants. We
are more and more attracting people from a different back-
ground, with other competencies. I don’t believe you can
retrain accountants’’ J1.
In ?rm J, accountants that did receive training opportu-
nities openly rebelled to the point where the board was
asked to intervene. Another example is ?rm F; the ?rst to
have relation managers. As ‘‘the average accountant does
not have the communication or commercial skills necessary’’
(F3), they often attract non-accountants, who brainstorm
free of charge with clients to discover their needs. Subse-
quently the back of?ce caters to these demands and deliv-
ers the services, ranging from accounting, organizational or
law related advice.
The ?nal set of ?rms – ?rms D and K – still comply pre-
dominantly with the trustee logic. Although ?rm D per-
ceives the need to develop new products and invests in
them, it is not investing signi?cantly in automation in or-
der make the creation of annual accounts as ef?cient as
possible. Some informants indicate this is mostly due to
inertia rather than professional determination:
‘‘With these things [innovations in XBRL and services]
things need to hurt ?rst before we start acting. . ..during
Table 5
Firm speci?c responses relating to the role of the accountant.
a
Role of the accountant Acquiescence Compromise De?ance Manipulation
Accountant to advisor Core business K B, C, D, E, G, I A, H, J F
Training J, K C, D, E, G, H A, B, I
(Advisory) services Formal business development E, K A, B, D, H, J I
Range of services, specialist concept B, D, E, G, H, I, K A, C, F, J
Cold acquisition B, C, H, J F, K D, G, I
Automation of services Portals/online service E, I B, C, H, J A, F
XBRL D, K A, C, E, I B, F, J
a
Firms have not commented on all strategic choices. If that was the case they were not assigned a strategy.
Table 6
Locus of resistance to the changing role of the accountant.
Role of the accountant Accountants Partners
Accountant to advisor Core business A, C, D, E, F, H, I, J, K K
Training E, G, I, J
(Advisory) services Formal business development D, K K
Client acquisition Cold Acquisition D, G, H, I, K G, H, I, K
Automation of services XBRL B B, D, K
140 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
partner meetings we’ve talked about it but nothing hap-
pens. Entire groups are just not entrepreneurial enough;
partners are not entrepreneurial enough to see that now
is the time to be creative. First things really have to start
hurting before anything will actually change’’ D3.
‘‘People don’t want to look too far ahead as long as money
keeps rolling in.’’ K1
Another new technique introduced because of in-
creased market competition is cold calling. This practice
was frowned upon and deemed unprofessional until rela-
tively recently. Although a number of ?rms (D, G and I)
make use of it, most ?rms resist or sparingly use this prac-
tice, both at the level of the non-partnered accountant and
the partner. Almost all ?rms remark that their relationship
with clients is based on trust: ‘‘it’s a trusting relationship,
you’re not selling pens or coffee machines, we are selling
added value in a trusting relationship’’ (H2). They describe
their role as shifted from a ‘‘controller to an advisor’’ (A1,
H1), ‘‘a sparring partner’’ (B1) or even to ‘‘a general practi-
tioner’’ (F2). Hence most agree that they need to compete
on quality through specializations and not on price and
that ‘‘accountants are hesitant to use it [cold calling] as they
feel they need this trust relationship’’ (K1).
In all, the shifting role of the accountant is not whole-
heartedly embraced by partners and non-partners alike.
Partners perceive the need to complement their existing
practices with advisory services, as long as it relates to
their original profession. Non-partnered accountants how-
ever are fearful and resistant to this change as it forces
them to draw on a completely different set of abilities as
compared to their original work. This results in differing
organizational responses ranging from limited addition of
advisory services to addition of related services by training
accountants or by decoupling the back of?ce from the
frontline or hiring non-accountants. With regard to the
possibility of advertising and a more pro-active market ap-
proach, ?rms obtain new leads in various ways. Neverthe-
less, cold calling is still considered undesirable for the most
part as it violates the trust relationship with clients
respondents perceive to be essential for selling their advi-
sory services.
The changing organizational practices
The drivers for change do not only in?uence the role of
the accountant, they also in?uence organizational prac-
tices. Main drivers here are: imposed rules and regulation
that demand high control of quality; developments in
technology that require more formal organization, a coher-
ent organizational system, and ‘critical mass’; the global-
ization of clients has led ?rms to join international
networks, which in turn demand certain changes in struc-
tural arrangements; and, demands of clients for more spe-
cialized advisory services that again have implications for
‘critical mass’. Our data show that organizations have to
decide how they respond in four important ways: (1) ?rms
make choices about their governance system (maintain
their traditional form of organizational governance
through collegial decision making, place the management
of the ?rm in the hands of a non-professional, or engage
in directive decision making); (2) ?rms need to decide on
their management control systems, moving from tradi-
tional professional and collegial controls to performance-
pay systems that can stimulate new client acquisition
and successful delivery of new advisory services; (3) ?rms
reevaluate their organizational structure following more
stringent quality demands; and (4) ?rms need to decide
how to respond to the increasing client demand for inter-
national services. Table 7 provides an overview of ?rm re-
sponses with regard to organizational structures and
practices.
All ?rms agree that given their shift to more specialized
services and automation they need critical mass, either by
consolidating locations or by increasing the size of their
of?ces:
‘‘That [critical mass] is just necessary for the continuity of
your services, but also for your people. You enter as junior
and when you are alone, what opportunities for personal
development do you have?’’ H2
‘‘If you want to compete, you just need volume in order to
offer specialized services and to be able to make future ICT
investments. You need it to ensure the quality to be able to
make the move from a lot of administrative work to more
advisory services and to act as coach of an entrepreneur’’
F3.
Similarly, most ?rms have separated their audit branch
from their other services although this is not required by
law for this group. Again this change is made to ensure
quality:
‘‘Mostly in order to ensure quality, in order to be able to do
suf?cient audits and to ensure control. I am convinced that
if you conduct too few audits, you start making mistakes’’
F3.
Although consolidation of a number of of?ces has taken
place in some ?rms, they also all agree that they require a
local presence to best service their clients:
‘‘Well actually if you look at the situation from a cost
reduction perspective, it is of course important to have
fewer of?ces. But when you look from a commercial per-
spective and the way we are positioned in the market –
for small and medium-sized ?rms – you have to show your
face in the market. Also, I believe that the of?ces can’t be
that big that people are scared of the sheer size of an of?ce.
You need to meet their way of doing business’’ B1.
We start to observe differences in ?rm responses when
it comes to topics that affect the vested interests of the
partners: the decision making process, performance-pay
schemes and the presence of non-professionals as manag-
ers. We can discern two clusters of ?rms. The ?rst cluster
of ?rms (A, B, C, D, E, G, H, I and K) makes little changes
with regard to their organizational practices and continues
to adhere to the demands of the trustee logic. Most ?rms
still have partners who manage the ?rm through collegial
decision making processes. These processes however, are
slightly more directive to reduce differences in implemen-
tation of strategic decisions.
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 141
‘‘It’s a little back and forth. Sometimes people are fed up
with the constant discussion and want the board to be
more directive. On the other hand if you are too directive
you get criticism, we are all partners with a vote, and they
all want to use it. So you need balance’’A1.
Within and between these clusters there again is great
divergence in the practices these ?rms adopt and resist.
For some ?rms in the ?rst cluster, informants point to
the diverse constellation of practices and partners (D4) or
their own little islands (I3) as the reason for their resis-
tance. They want to ensure that ‘‘their own people come
?rst. . . and just as long as things get arranged for their of?ce’’
(A4). Other informants point to the differences with the big
4 ?rm that they left, as the desired freedom that they did
not had there, but do have in their mid-sized ?rms.
‘‘At least we have the illusion, and I think that it is true in
practice, that we have the freedom to create and develop
our own ideas, celebrate our successes but also bear the
consequents of our ways of working. Just the freedom of
entrepreneurship that you lack in any big of?ce’’ G1.
Therefore most ?rms indicate they decide on the strate-
gic plans centrally but ‘‘locally they have the freedom to put
it into practices as you think best’’ (E1).
This is clearly related to the clear absence of non-pro-
fessional managers and the reason is unambiguous:
‘‘I think that if you are in a managing position and you
don’t know what is happening with the clients, that is just
not good. You need to have day-to-day experience’’ B1.
Another practice these ?rms resist is performance-pay
schemes, because there is not ‘‘much applause for it’’ (E1).
As local presence is necessary, as long as there is agree-
ment on the roles in the ?rm and on how partners contrib-
ute and as long as of?ces do not seriously underperform,
partners do not perceive the need to change the equal prof-
it sharing system. In fact:
‘‘But in the really big of?ces, you can see it gets greedy,
with those differentiated pro?t shares focussed on individ-
ual performance. It may be that it is necessary in large
?rms in order to keep it manageable. But undoubtedly it
will lead to political games that are not in the interest of
the entire organization’’ G3.
One informant goes even further by stating that the rea-
son they have not implemented such a system is that: ‘‘We
don’t have pro?t maximization as a main goal. We just
want to earn enough to continue the business and be able
to offer a certain level of quality in our services’’ (C1).
Finally some ?rms decide to cater to the international
wishes of their clients, most by joining an international
network as they do not want to open up of?ces abroad.
This however is clearly related to client demand.
The second cluster of ?rms consists of only two ?rms –
?rms F and J – that have adapted most of their structures to
the new commercial logic. Firm J has a non-professional
managing partner, whereas Firm E has of?ce managers in
charge of its local of?ces. Firms F and J have abandoned
collegial decision making in favor of more directive forms.
As ?rm J indicates:
‘‘We do not discuss strategy monthly because we just don’t
allow it. We did that before but in order to create a steady
course we stopped. Otherwise you keep changing direc-
tion’’ J1.
Firm F also works with differential performance-pay
systems for partners and employees (‘‘Yes, we have perfor-
mance-pay systems down to the secretary including a share in
the pro?t’’, F2) and has high levels of directive decision
making. At the same time, however, Firm J has decided to
create more and smaller of?ces throughout its region, sig-
ni?cantly smaller than the average of?ce of the other mid-
tier ?rms but more importantly which would not be
staffed with accountants.
‘‘Imagine a nice place where you can meet with clients,
where you can discuss strategy, where there are big white-
boards. Well you don’t need accountants there; we have
put them together in one of?ce.’’ J1.
However, ?rm J is an exception. Overall there is rela-
tively little change in the practices and structures of most
organizations. Where resistance to changes in the role of
the accountant was located more at the level of non-part-
nered accountants, the resistance against changes in orga-
nizational structure and practices is solely attributed to the
partners. Especially with regard to the governance of the
?rm, almost all informants indicated that a non-profes-
sional as managing partner would not be accepted as they
Table 7
Firm speci?c responses relating to organizational structures and practices.
a
Organization Acquiescence Compromise De?ance Manipulation
Organizational
governance
Background management/board
members
A, B, D, F, G, I C, H, K E, J
Decision making/voting C, H, K A, B, D, E, G, I J F
Performance pay system Division pro?ts A, E, G, H, I, J, K C B, D, F
Evaluation functionality K C, F, H, I, J A, D, E
Organizational structure (Merging) Number of locations A, B, C, D, E, F, G, H, I, J, K
Critical mass C, D, F, G, H, I, K A, B, E J
Separation audit and advisory A, K C B, D, E, F, H, I
Service lines A, H B, D, G, I
Staff services C A, B, D, F, G, H, I, J
Internationalization Network E, J, K C, F, H, I G D
Clients/services E, J B, F A, G D
a
Firms have not commented on all strategic choices. If that was the case they were not assigned a strategy.
142 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
believe a ?rm grasp of the profession is necessary to run
the ?rm. Similarly most partners still want a say in the
strategic direction of the ?rms, hence these ?rms still em-
ploy, for the majority, collective decision making pro-
cesses. The sources of resistance are shown in Table 8.
Clearly our mid-tier ?rms have little interest in changing
the basic structure and identity of their accounting ?rms,
cherishing their professional norm of autonomy.
Discussion
In this study we set out to investigate organizational re-
sponses by mid-tier accountancy ?rms in the face of con-
?icting institutional logics. While most studies describe
how institutional changes trigger institutional action by
either elite (Greenwood & Suddaby, 2006) or maverick ac-
tors (Leblebici et al., 1991), we focused on mainstream ac-
tors in an organizational ?eld. Based on our analysis of
interviews with 34 top management level informants of
11 mid-tier accounting ?rms and an investigation of sec-
ondary material, we make three main contributions. We
enhance understanding of how the characteristics of
accounting as a profession affect organizational resistance
and change in mid-tier ?rms. Second, we shed light on the
concrete organizational responses in mid-tier accounting
?rms to institutional change. Third, we question the gener-
alizability of PSF research.
Sociology of professions and organizational resistance
Our ?rst contribution is to the literature on the sociol-
ogy of professions and our understanding of the drivers
of change in the accounting industry. Academics have been
critical about the motivations of professionals for main-
taining their status. They have challenged the extent to
which claims to social closure and economic monopoly
are legitimated by the profession’s societal function and
responsibility (Reed, 1996; Tinker, 1985). Instead they
see these activities merely as means to constitute and con-
trol the market by creating scarcity for their resources (Fre-
idson, 1984; Larsson, 1977). As the accounting industry
developed, the shift in emphasis from trustee logic to com-
mercial logic (Dezalay, 1995; Hanlon, 1996) and its conse-
quences have been referred to as evidence of this position.
While big 4 ?rms argued for the necessity of an evolution
towards a more client-oriented and more consciously
managed ?rm in order to provide high-quality accounting
services (Suddaby & Greenwood, 2005), indicative of the
dif?culty of this move away from the trustee logic are
the ENRON scandal (Covaleski, Dirsmith, & Rittenberg,
2003) and the recent ?nes imposed on the big 4 ?rms for
audit failure (Financial Times, 2012a, 2012b). According
to Wyatt, greed has in?uenced professional accountants
such that the ‘‘core values of the professional ?rm were
undermined by primarily commercial interests’’ (Wyatt,
2003, p. 6) and Greenwood (2007) argues that the balance
between pro?ts and professionalism has shifted to the det-
riment of professional behavior. Academics note that the
shift has led to an emphasis on pro?t-maximization (Elliot,
1999 in Samuel, Covaleski, and Dirsmith (2009)). This shift
inherently also meant the adoption of new sets of organi-
zational structures and practices associated with this com-
mercial logic (Cooper et al., 1996; Greenwood & Suddaby,
2006; Hanlon, 1996, 1997).
In our sample, we observe that the choices that the mid-
tier ?rms make in terms of their structures and processes
draw on both economic and professional rationales. How-
ever theprofessional logic seems toremaindominant. While
the leadership of these ?rms understands that they have to
offer moreadvisoryrelatedservices becausetheir coreprod-
uct will no longer be pro?table in the near future, the types
of services they offer are closely relatedto their original pro-
fession. They argue that to offer anything not connected to
the profession would endanger professional standards. In
professional services ?rms, the individual professional’s
job description and identity are directly informed by the
standards of the profession that to a large extent also make
up the organization’s institutional environment (Green-
wood et al., 2002; Scott, 2008; Suddaby & Greenwood,
2005). Furthermore it is part of the professional’s identity
and responsibility to actively maintain the professional
institution, thereby resisting the commercial market logic
(Freidson, 2001). Similarly, while the big 4 attract different
sorts of experts to provide their advisory services, 9 out of
our 11 ?rms dismiss this idea. Of course, commercial and
economic arguments do play a role. Most ?rms decide to
automate their consolidation services as well as remain
close to the clients as these clients demand their local pres-
ence. However, they argue from a professional perspective
that the separation of audit and advisory is necessary to en-
sure continued quality of both. Also most ?rms do not en-
gage in cold calling as yet again this goes against their
professional identity and is not helpful given the long-term
trust relation they seek with their clients. In all, while of
course the aim of these ?rms is also to make a pro?t, which
in itself does not contradict the professional ethics and ser-
vice to society ideals (Freidson, 2001), their explanations for
reported changes are very much geared towards maintain-
ing professional standards and the quality of services. These
Table 8
Locus of resistance to the organizational structure and practices.
Organization Accountants Partners
Organizational governance Background management/board members A, B, D, F, G, I
Decision making/voting A, C, G, I
Performance pay system Division pro?ts E, G, H
Organizational structure (Merging) Number of locations D
Service lines A
Internationalization Network D, G
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 143
?ndings mirror what Hanlon (1997) found in the lawindus-
trywhere professionals insmaller ?rms continue to drawon
much of the social service ethos and rhetoric and are hostile
to managerialism. In sum, we argue that the sun is not set-
ting on professionalism in mid-tier accounting ?rms. Their
embeddedness in the original professional logic with an
emphasis on service ethic is still strong and is supported
by the type of relationship requested by their local clients.
A second insight we draw from our ?rms is that
although in some cases top management does see the merit
of a proposed change, often it is unable to align its internal
constituency. While partners underscore the need to offer
advisory services in order to ensure pro?tability, non-part-
nered accountants resist this practice as they are risk averse
and afraid of the implications of this shift. Hence a slow
process of training and formal business development is
put in place to provide themwith skills and knowledge nec-
essary to make the change. We also ?nd evidence of resis-
tance at the level of the partners. Covaleski et al. (1998)
as well as Dirsmith et al. (1997) ?nd in their studies on
the introduction of management by objectives that admin-
istrative partners wish to control and shape behavior of
practice partners and non-partnered accountants but that
this is resisted by practice partners as it limits their auton-
omy. We see a similar resistance to structures and pro-
cesses that limit partner autonomy. In the ?rms in our
sample most managing partners and practice partners
alike, are still actively involved in the delivery of services
and as such resist the same practices and structures. For in-
stance they resist the merging of locations, very directive
forms of decision making, individualized performance-pay
systems and the presence of non-professional managers.
For future research it could be of interest to explore what
the shift from the trustee to the commercial logic, and the
concomitant development of organizational structures and
processes, means for the non-partnered, non-managing
accountants. While our informants report themto be ingen-
eral riskaverse, thereasonfor their resistanceis still unclear.
Their importance as a source of resistance however is clear
as ?rms do have to adapt their organizational responses to
move theminto the zone of acceptability (Ansari, Fiss, &Za-
jac, 2010; Lewis & Seibold, 1993; Radnor, Feller, & Rogers,
1978) for this group of professionals.
Organizational responses, archetype change and institutional
logics
Our second contribution is to the literatures onorganiza-
tional responses, archetype change and, particularly, insti-
tutional logics. Studies of organizational responses to
institutional pressures (Oliver, 1991) are numerous but of-
ten focus on the adoption or non-adoption of speci?c prac-
tices (e.g. Ang & Cummings, 1997; Fiss & Zajac, 2004,
2006; Goodrick & Salancik, 1996; Greening & Gray, 1994;
Lounsbury, 2001, 2007; Milliken et al., 1998; Rao & Sivaku-
mar, 1999; Thornton, 2002; Westphal et al., 1997). Also,
studies investigatingthe?eldlevel end-states ininstitution-
ally complex ?elds show a number of different outcomes
like a shift from the old dominant logic to the newly intro-
ducedlogic (e.g. Thornton, 2002; Zilber, 2002); the introduc-
tion of elements of a new logic into a dominant one (e.g.
Glynn, 2000) or the hybridization of elements of both the
old and new logic (e.g. Colyvas & Powell, 2006; D’Aunno
et al., 1991; Purdy & Gray, 2009). However, little is known
regarding the micro-level processes of how organizations
and actors respond to competing institutional pressures, in
which the process of ?eld level change has yet to be played
out. In this paper, we look at howaccounting ?rms strategi-
cally respond and develop their portfolio of practices. Doing
this, we heed the call for more research connecting ?eld log-
ics, organizational practices and industry institutional
change(Lounsbury, 2008; Thorntonet al., 2012) andprovide
further insight into early stage blending experimentation by
organizations: a situation where organizations experiment
with the development of novel practices following changes
in the inter-institutional system that shift the relative
importance of multiple ?eld-level logics.
Besides clearly documenting how the existing institu-
tional logics place con?icting demands on our sample
?rms, we ?nd that in their responses to pressures from
the trustee and commercial logics, our mid-tier ?rms do
not choose one consistent strategy vis-à-vis the institu-
tional pressures. Mid-tier accounting ?rms respond selec-
tively and independently to strategic and structural
issues invoked by the new commercial logic. Most ?rms re-
main adherents to the trustee logic in which they are still
heavily embedded (Granovetter, 1985; Greenwood & Hin-
ings, 1996; Maguire, 2007; Oliver, 1997). Due to the previ-
ously mentioned sources of organizational resistance and
the perceived suitability of elements of both logics for
resolving concrete managerial challenges, strategic re-
sponses to the challenges of the new commercial logic dif-
fer substantially between ?rms. Thus we see a fragmented
implementation of elements of the new logic, not based on
the internal coherence of the logics at hand. This is in line
with a toolkit perspective of logics where logics guide indi-
vidual’s focus of attention, but where the activation of as-
pects of speci?c institutional logics is contingent on their
applicability and relevance in a speci?c situation (Thorn-
ton et al., 2012, p. 84). Our ?ndings thus indicate that rel-
evant situational cues come from both the issue at hand
and the organizational role of the actors involved. Our ac-
tors seemto draw on logics as sort of cultural toolkits (Swi-
dler, 1986), highlighting their partial autonomy from social
structure, allowing them to pick and choose their re-
sponses. However, while dependent on situational cues,
our ?ndings indicate that we cannot place the mechanism
of action completely outside the person. A criticism on the
original cultural toolkit-perspective is that it is without a
clear mechanism of motivation. This criticism is motivated
by the ?nding of earlier research that much cultural infor-
mation is inherently contradictory and cognitively stored
without ‘truth value’, it therefore cannot be a theory of
motivation (e.g. DiMaggio, 1997). According to Boltanski
and Thévenot (1991) the role of values in a toolkit perspec-
tive is for justi?cation, rather than moral motivation. We
would argue that our mid-tier accountants do not just
selectively use applicable institutional logics for analysis
and decision justi?cation. While they draw on both eco-
nomic and professional rationales, their argumentation re-
?ects both elements of rational justi?cation and moral
motivation drawn from the relevant fundamental institu-
144 M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148
tional logics in the inter-institutional system – the profes-
sional and market logics (Thornton et al., 2012). This moral
motivation is especially pronounced with regard to
changes that impact the values associated with their origi-
nal professional identity that have been imprinted through
socialization.
Our ?ndings thus highlight the relevance of further re-
search into how situational and positional circumstances
affect individuals’ focus of attention and their evaluation
of applicability and relevance of institutional logics in deci-
sion-making processes. Furthermore, further investigation
of how actors choose and use elements of logics for justi?-
cation and/or moral motivation of choices in processes of
institutional change seems warranted to better understand
the dynamics of practice developments in ?elds governed
by multiple con?icting institutional logics.
Our ?nding that these mid-tier accounting organiza-
tions draw on institutional logics as a toolkit contradicts
expectations of integral change towards organizational
archetypes based on the new (commercial) institutional lo-
gic. Institutional logics involve values and beliefs by which
individuals produce and reproduce their material subsis-
tence (Thornton & Ocasio, 1999). As such they directly
in?uence organizational structures and processes (Green-
wood et al., 2009). This is closely related to the concept
of interpretive schemes which underlie organizational
archetypes. Archetypes are interconnected structures and
systems that together support the particular values and
norms at the heart of the substantiated interpretive
scheme (Greenwood & Hinings, 1993). This would thus
mean that logics and archetypes should form logical and
interrelated practices which should be shown in a similar
con?guration. Examples are studies of the development
of Multidisciplinary Practice in accounting ?rms (Green-
wood et al., 2002) or the Managed Professional Business
in law ?rms (Cooper et al., 1996) as archetypes that re?ect
the emphasis on the commercial logic.
Such coherence however is not observed in our group of
mid-tier ?rms. The toolkit approach our mid-tier ?rms em-
ploy to deal with each of the speci?c issues they face, re-
sults in hybrid structures on the organizational level
(Greenwood, Raynard, Kodeih, Micelotta, & Lounsbury,
2011). These organizational strategies in the face of institu-
tional complexity resonate with the process of sedimenta-
tion in the development between archetypes (Cooper et al.,
1996). However, while sedimentation is a process of be-
tween-archetype changes by coupling mutually constitu-
tive interpretive schemes on top of each other, we are
unsure if this is the case for our mid-tier ?rms. The ?rms
continue to draw heavily on the professional interpretive
scheme and move only in small incremental ways towards
a more commercial scheme. However, as we are still in the
early stages in the transformation of the mid-tier segment
of the accounting ?eld, it is too soon to judge if this is the
start of a process of between archetype change or a within
archetype change. This may well be a case of what Morris
and Pinnington (1999) imply as a ‘‘more recursive and
re?exive model where old and new values and systems
interact and reinterpret each other’’ (Brock et al., 2007, p.
244). An interesting area for future research here is the
in?uence of a hybrid organizational structure on organiza-
tional objectives such as performance and professionalism.
As archetype theory is premised on con?gurational theory
in which organizational structures and practices act in a
complementary way (Greenwood & Hinings, 1993), in this
perspective using a toolkit approach leads to blending of
logics and subsequent loss of coherence between organiza-
tional systems and processes. Additionally, given that
many of the mid-tier ?rms experience internal resistance
to these espoused changes, it begs the question if these hy-
brid ?rms will be equally successful in achieving their
objectives.
On the institutional ?eld level, there is evidently not a
wholesale move to the commercial logic in the accounting
?eld. Where the commercial logic and its related archetype
is present in the big 4 ?rms, among mid-tiers we are in a
period where several competing organizational designs ex-
ist. As such, the process of diffusion looks more like a pro-
cess of institutional bricolage (Aldrich, 2010) and we
cannot detect any logical interrelatedness of practices.
Considering the institutional development of the ?eld of
accounting it thus seems warranted to further follow up
and investigate the ways in which the theorization of the
competing logics (Greenwood et al., 2002) and the incre-
mental adaptation of organizational practices result in
competing and evolving organizational designs.
Generalizability of PSF research
A third contribution we make is to the literature on PSFs
by addressing the issue of generalizability (Von Nord-
en?ycht, 2010). Much of the ?ndings relating to the shift
from the trustee to the commercial logic are premised on
evidence from case study research (Malhotra, Morris, &
Hinings, 2006). There are however, certain contingencies
that raise questions regarding the generalizability of the
extent of this shift across different strata of professional
?elds (Cooper et al., 1996; Pinnington & Morris, 2003) as
well as between professions (Malhotra & Morris, 2009).
Our ?ndings offer insights in both types of generalizability
issues and heed the call for research that goes ‘‘beyond the
larger ?rms’’ (Malhotra, Morris, & Hinings, 2006, p. 198).
In terms of inter-professional comparisons, Malhotra
and Morris (2009) suggest a number of contingencies that
can explain differences in support for the trustee or com-
mercial logic. First, PSFs that draw on normative knowl-
edge (e.g. law ?rms) are likely to have a professional
organizational form, whereas those PSFs that draw on syn-
cretic knowledge (e.g. accounting ?rms) are likely to have a
professional-bureaucratic hybrid organization. Also, strong
social closure should lead to limited specialization and
resistance of diversi?cation. Additionally, a high degree
of face-to-face interaction with clients should lead to a
large number and more dispersed of?ces. Overall, the accu-
mulated studies suggest that accounting ?rms, because of
these characteristics have moved more to the MPB form
(cf. Greenwood & Suddaby, 2006) whereas law ?rms more
closely resemble a sedimented form remaining closer to
the professional form (Ackroyd & Muzio, 2007; Pinnington
& Morris, 2003). Our ?ndings however paint a slightly dif-
ferent picture. Our mid-sized accounting ?rms follow the
same path as medium-sized law ?rms in which profession-
M.W. Lander et al. / Accounting, Organizations and Society 38 (2013) 130–148 145
alism remains dominant. For instance, mirroring Cooper
et al. (1996) we also ?nd that democracy is important
and compensation schemes remain tolerant in terms of
performance. Additionally, we ?nd that they maintain a
large number and often dispersed local of?ces due to client
demands and engage in limited specialization and resist
diversi?cation even though social closure has been less-
ened of late. Our ?ndings thus suggest that the extent of
social closure, the degree of face-to-face interaction or
the type of knowledge employed may account for some
of the differences in organizational forms between profes-
sions; but that the extent of embeddedness of small and
medium-sized ?rms in their local institutional context is
also of signi?cant in?uence (Greenwood et al., 2002; Ra-
mirez, 2009) and leads to similar developments for mid-
tier ?rms in the ?elds of accounting and law.
Within professions there are segments that have differ-
ent and even con?icting value positions (Strauss, 1975)
due to these differences in embeddedness. Evaluating var-
iation in organizational forms among professional service
organizations Malhotra et al. (2006) indicate the need for
further investigation of these ‘‘within-profession’’ differ-
ences. Where Hanlon (1997) already found divergent re-
sponses to the commercial logic in the law industry with
professionals in smaller ?rms continuing to draw on much
of the social service ethos and rhetoric, we ?nd that the
changes in the big-4 accounting ?rms identi?ed by Green-
wood and Suddaby (2006) cannot straightforwardly be
extrapolated to the mid-tier ?rms in the accounting indus-
try. As these ?rms remain more embedded in their local
institutional context, they are more dependent on the na-
tional associations as sites of professionalization than large
professional ?rms that develop and provide much of their
training in-house (Cooper & Robson, 2006; Ramirez, 2009).
Also they service a different type of clientele (Ramirez,
2009) and their professionals have greater in?uence on
the day-to-day dealings within their ?rms. In contrast
the big 4 in Greenwood and Suddaby’s (2006) research
are operating in an international arena, dealing with multi-
national clients in a supra-national arena. Our mid-tier
?rms are well-established in their national professional
arena and our ?ndings indicate that professional norms
are stronger with this group. This echoes the ?nding of
Greenwood et al. (2002) who noted that the regional and
local ?rms in their study had only modest sympathy for
the new organizational form of the big 4 ?rms. We clearly
see the group of mid-tier ?rms responding to the con?ict-
ing institutional logics that have been recognized in previ-
ous research on the big 4 accounting ?rms. However, while
these large ?rms had a relatively comprehensive/consis-
tent agenda pushing the commercial logic, our study sug-
gests that organizational responses to con?icting or
changing logics may be subject to different dynamics
across different sets of actors within an organizational
?eld. Greenwood and Suddaby (2006, p. 44) documented
organizational change within the big 4, and asked: ‘‘how
in?uential are professional norms when required to stretch
across very different organizational members, ranging
from elite, central ?rms, to modestly sized, local ?rms?’’
We would argue that they are quite strong for both part-
nered and non-partnered professionals in mid-tier
accounting ?rms. In order to address the issue of general-
izability both across and within professions we call for fu-
ture micro-level research in order to determine how and to
what extent embeddedness in local institutional environ-
ments explains the continued adherence of mid-sized
and small ?rms to the trustee logic and as a consequence
its related organizational form.
Acknowledgements
Michel W. Lander would like to thank the AXA Research
Fund for its ?nancial support and Bas A.S. Koene would like
to thank the Erasmus Trust Fund and the Stockholm Centre
for Organizational Research for their support.
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