Dissertation/Thesis Abstract

Collective Knowing about Organizational Risk: Evidence from Pre-financial Crisis Mortgage Lending
by D'Alessandro, Dane Richard, Ph.D., Benedictine University, 2019, 283; 13881570
Abstract (Summary)

Assessing and managing knowledge about organizational risk represents an emerging focus within organizational studies. Increased environmental complexity and uncertainty have sharpened theoretical and managerial attention to how stakeholders make sense of, and respond to, organizational risk. However, existing research on organizational risk is fragmented, alternatively framing risk as objective and quantifiable or socially constructed and subject to contested meanings.

To bridge these perspectives, this dissertation conducts an inductive, longitudinal, multi-case study, focused on the collective evaluation of risk knowledge at five leading U.S. mortgage lenders. The study period addresses the higher-risk U.S. mortgage lending market between 2004 and 2008, the advent of the global financial crisis. We perform a discourse analysis related to mortgage risk assessment and evaluation, as it occurred in two venues: first, between top company executives and external stakeholders, including equity analysts and Boards, and second, within executive teams internally.

Analysis of lender discourse illustrates how collective evaluation of risk knowledge is enacted through a process of knowledge ‘justification’. Knowledge justification encompasses both quantitative calculations of risk exposure and two intersubjective assessments: (1) the ‘actionability’ of risk, based on its consistency with the organization’s existing dominant logic, and (2) perceived stakeholder legitimacy judgments regarding risk response. In this study, the knowledge justification process was shaped by organizational power relations embedded within the organization’s dominant discourse and intensified by political behaviors which reinforced preferred risk interpretations. The knowledge justification process evidenced though this study challenges normative models of organizational risk assessment, by foregrounding social factors also influencing risk interpretation and response. Finally, knowledge justification as defined here supports a Foucauldian perspective of power enactment through dominant discourse, partially reconciling the paradox of executive inaction as risks accumulated in the advent of a major crisis.

Indexing (document details)
Advisor: Tenkasi, Ramkrishnan V.
Commitee: Brock, William B., Sorensen, Peter F.
School: Benedictine University
Department: Organization Development
School Location: United States -- Illinois
Source: DAI-A 80/09(E), Dissertation Abstracts International
Subjects: Business administration, Organization Theory, Organizational behavior
Keywords: Case study, Discourse analysis, Financial crisis, Organizational knowledge, Organizational learning, Organizational risk
Publication Number: 13881570
ISBN: 978-1-392-14783-2
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