Complicating Abandonment: How a Multi-Stage Theory of Abandonment Clarifies the Evolution of an Adopted Practice

Abstract

This article presents a process-model for the abandonment of a practice. This complements earlier research on adoption and abandonment by allowing for fluctuations in the level of commitment across time and by demonstrating the persistent role for both institutional pressure and performance-based concerns on the maintenance of a practice. It also provides a novel means for identifying differences in the method of abandonment through the introduction of a concept of decommitment. Further, it helps resolve the question of how firms respond when faced with conflicting internal and external evidence of the success of an adopted practice. Using the divestiture of unrelated business segments by 100 U.S. firms between 1970–96, I estimate post-adoption commitment to a practice and the likelihood of a given firm decommitting. I find that treating abandonment as a process clarifies the evolving role of institutional and performance-based concerns and helps identify when a given firm is more subject to either source of pressure. The implications of this approach and these findings for current research on resistance to adoption and de-institutionalization are explored in the conclusion.