Analysis of the Study of Religious Organizations 129
The dichotomy that scholars suggest exists between professional rationality and reli-
gious spiritualism has thus been woefully misleading. This kind of opposition implicitly
creates a romantic image of religious communities and their members as being inner-
directed, otherworldly, and removed from the realities of everyday life, which is not
only patently at odds with the pragmatic kind of religion that most Americans practice
but also is at odds with the primary social teachings of the Christian churches that di-
rect members to engage the world (Bacon 1832; Hollenbach 1989; see also McRoberts,
Chapter 28, this volume). If one accepts a religious worldview that seeks to engage and
transform the world, then it seems to follow that pragmatism and entrepreneurialism
are consequences of that religious spirit and cannot be categorized as inherently secu-
lar. The historical record in fact shows that the most influential proponents of religion
in America were adept at employing both of these characteristics.
Neoinstitutional Theory
As growth in religious membership began to confront secularization theory with in-
creasing evidence of its own demise, scholars began to turn away from “bureaucracy
as secularization” arguments and move toward what are broadly called “open systems”
approaches in organizational studies. Open systems approaches focus on how an or-
ganization’s interchanges with the environment affect organizational behavior. Con-
sequently, they tend to place greater attention on the kinds of relationships that an
organization has with customers, suppliers, and regulators than it does on the internal
politics or power struggles within an organization (Scott 1987).
Of the various open systems approaches available, religion scholars have been par-
ticularly attracted to a perspective called neoinstitutional theory (Meyer and Rowan
1977; Powell and DiMaggio 1991). This theory is attractive to religion scholars, be-
cause it emphasizes the role of cultural processes in shaping organizational behavior.
It argues that the formal structures of organizations arise not from the functional de-
mands of work activities but, rather, from a need to conform to the myths and rituals
that define legitimate behavior within an institutional sector. Neoinstitutionalists ar-
gue that, when organizational practices become highly legitimated, they diffuse rapidly
across an institutional sector. Conformity to these practices signals the legitimacy of the
adopter and makes it easier for the organization to make important connections with
other institutional actors in the field. A simple example of the way cultural signaling
operates is illustrated in the typical advice one receives to dress well when applying for
a bank loan. Dressing conservatively and respectably signals conformity to normative
values that the lender correlates with one’s reliability in repaying the loan. Similarly,
neoinstitutionalists argue that organizational behavior is often guided by conscious
and unconscious motivations to appear competent and successful in order to cultivate
the kind of trust that encourages others in their environment to engage in risk-taking
relationships (Powell and DiMaggio 1991). Neoinstitutionalists emphasize the degree
to which organizations are constituted by this ritualistic behavior and how this behav-
ior is often so deeply encoded within routines, scripted behaviors, and practices that
are defined as “rational” that managers are unaware that they are enacting ritualistic
behaviors (Meyer and Rowan 1977).
Religion scholars are attracted to a neoinstitutional schema in part because it is one
of the few organizational perspectives that pay attention to the role of cultural and