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Institutional theory is focused on the prevalence of social value over economic imperatives in organizational life, but what happens when taken-for-granted practices offer neither technical nor institutional value at all? In this paper, the authors theorize an important but omitted in the organizational literature scenario and a class of institutionalized practices. The authors conceptualize them as institutionary eclipsed practices. The paper offers a theory of institutional shadow and institutional eclipsed practices that explains the remarkable persistence of institutions despite the obvious absence of value.

The authors offer a theoretical framework for studying institutional practices that have neither economic nor social value. The authors illustrate institutionally eclipsed practices with an example of educational organizations and practices, but the theory of institutional shadow developed in this paper goes beyond this case.

Organizations adopt global institutional standards for local organizational fields where different institutional norms prevail and different meanings and values are attached to these global institutions. In some cases, such institutions may lose their technical value and have no social (legitimizing) value in a new institutional context. Such practice is taken for granted, enacted, reproduced and maintained as necessary because it is encoded into the very institutional image of a profession (and social role). An institutionally eclipsed practice becomes a taken-for-granted, integral part of organizational members’ daily routines. Still, neither efficiency nor social benefits and value are offered by such a practice for organizational members. At the same time, as institutionalized practices are resistant and usually immune to technical, economic and social changes, they tend to endure and persist in organizations. Both a disintegrated practice and organizational members who enact it get into the limbo of the institutional shadow.

The authors distinguish and theorize three main conditions that allow institutionally eclipsed practices to emerge, proliferate and persist in organizations and across organizational fields. These factors include the presence of institutional meaning, the taken-for-granted quality (which means the immunity to technical, social and material changes) and the absence of contradictions. Together these three virtues allow institutionally eclipsed practices to be easily embedded into organizational contexts, being enacted by organizational members and avoiding abandonment and deinstitutionalization despite uselessness.

Institutional theory assumes practice adoption and subsequent decoupling. However, there is a range of alternative organizational theories that challenge this view and offer instead their reinterpretation, extension and modification of institutional predictions with regard to the adoption and possible range of various responses and processes that follow the decision to adopt. This paper aims to review this spectrum of theories and suggest how they clarify, supplement, correct, restrict and/or abandon some institutional explanations and predictions.

Extensions and alternatives to institutional theory are mainly motivated by the need to have a theory of practice adoption and variation, and a plethora of alternative practice adoption theories currently exists in the literature. The authors review these theories and compare them against institutional theory and against each other.

The analysis revealed shortcomings and advantages of alternative theories compared to institutional theory and against each other. It is suggested which theory is most useful in each domain of application. The authors review and compare institutional theory, Scandinavian institutionalism, management fashion theory, virus theory and institutional inertia theory and analyze how and whether they are able to reproduce the success of institutional theory and successfully address and resolve its shortcomings and gaps. The authors conclude by discussing whether regular emergences of new theories that account for the idea-handling stage of diffusion signals institutional theory’s limit of validity in this domain.

The problem of idea emergence/diffusion/disappearance and adoption/variation/use are fundamentally different, but both of them motivated researchers to go beyond institutional theory. Despite being the dominant theory of organizations internally consistent and explaining a wide range of empirical observations, it is evident that institutional theory is not a complete theory. This paper contributes to this problem by exploring and comparing existing candidates for practice variation theory.