`Not by Conformity Alone: Management Consultants’ Influence on Adoption Behavior and Performance

Please do not quote without permission We are grateful to Danny Samson for giving us access to the Australian Manufacturing Council database, to Doug Dow for helping us to mount it, to Margaret Wang for her research assistance, and to seminar participants at Melbourne Business School for their comments. ABSTRACT This study assesses the influence of management consultants on the diffusion of administrative innovations. We conceptualize consultants as agents of theorization (Strang and Meyer, 1993) and as " knowledge entrepreneurs, " (Abrahamson & Fairchild 1999). This conceptualization suggests that consultants will weaken the linkage between distinctive firm characteristics and adoption behavior. Accordingly we hypothesize that firms that use consultants will be more conforming – that is they will show higher levels of conformity to prevailing forms of the practice. We further hypothesize that as diffusion progresses and institutionalization begins or bandwagon processes take hold, consultants' influence will increase. We also hypothesize that use of consultants will affect the consequences of adoption – that weakening links between distinctive firm characteristics and adoption patterns will result in lower performance outcomes for firms that use consultants as compared to firms that do not use consultants. Support is found for all hypotheses. The findings suggest that consultants are important drivers of diffusion and isomorphism, as well as of management fads.