Acute external crisis can convert regionally bound institutions into globally oriented ones

Evidence

The aforementioned attempts all aimed at changing the institutional structures by adding new layers. An example for institutional conversion is the reform of the system of universities of applied sciences. This type of university was originally thought to fulfill the demands of the local industry. The severe economic crisis in the first half of the nineties and a temporally rapidly decreasing demand for university graduates by regionally based companies, led to a dramatic situation (e.g., few new students) in many universities of applied sciences. The answer was twofold: on the one hand, traditional curricula were dramatically reduced; on the other hand, new curricula were developed, which aimed at decreasing the dependence on specific regional or local demand structures. Even smaller universities were now faced with the demand to develop ‘world class’ specializations. The regional orientation thus has been reduced and the importance of the openness to supra-regional developments and actors strengthened. — Georg Schreyögg and Jörg Sydow, The Hidden Dynamics of Path Dependence, 936

Categorization

• XREF: Connects to the path-dependence literature’s ‘institutional conversion’ mechanism, where existing forms are repurposed rather than replaced.
• SEED: Angle: how a near-death moment forced small regional colleges to reinvent themselves as ‘world-class’ players — the hidden upside of demand collapse.