Reinsurance Trading in Lloyd’s of London: Balancing Conflicting-yet-Complementary Logics in Practice

TLDR

Reinsurance trading in Lloyd’s of London exemplifies long‑standing institutional complexity, where competing logics coexist and are routinely enacted in everyday practice. The study aims to shift focus from static organizational responses to institutional complexity by identifying and integrating three balancing mechanisms—segmenting, bridging, and demarcating—into a model that explains how individuals manage competing logics. The authors identify segmenting, bridging, and demarcating as mechanisms that enable individuals to manage competing logics, and they integrate these mechanisms into a theoretical model of dynamic tension between conflicting‑yet‑complementary logics. The model demonstrates that actors can dynamically balance coexisting logics—maintaining their distinction while exploiting interdependence—and that institutional complexity itself becomes institutionalized and routinely enacted in practice.

Abstract

Drawing on a yearlong ethnographic study of reinsurance trading in Lloyd's of London, this paper makes three contributions to current discussions of institutional complexity. First, we shift focus away from structural and relatively static organizational responses to institutional complexity and identify three balancing mechanisms—segmenting, bridging, and demarcating—that allow individuals to manage competing logics and their shifting salience within their everyday work. Second, we integrate these mechanisms in a theoretical model that explains how individuals can continually keep coexisting logics, and their tendencies to either blend or disconnect, in a state of dynamic tension that renders them conflicting-yet-complementary logics. Our model shows how actors are able to dynamically balance coexisting logics, maintaining the distinction between them while also exploiting the benefits of their interdependence. Third, in contrast to most studies of newly formed hybrids and/or novel complexity, our focus on a long-standing context of institutional complexity shows how institutional complexity can itself become institutionalized and routinely enacted within everyday practice.