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The combination of elements from state, market and society in hybrid organizations produces tensions, which can potentially lead to various positive and negative effects. These can be summarized as economic, performance related, cultural and governance related benefits and risks.

Effects of hybridity

The combination of elements from state, market and society in hybrid organizations produces tensions, which can potentially lead to various positive and negative effects. These can be summarized as economic, performance related, cultural and governance related benefits and risks:

Economic effects: hybridity can benefit an organization’s financial and economic position by for example getting access to new markets. But it can also lead to various forms of unfair competition, such as the use of cross-subsidies, the use of confidential government data for commercial means, the forming of public monopolies and the combination of conflicting roles. Economic effects are especially to be expected in organizations that are hybrid on the dimensions of my multi-dimensional model summarized as dealing with structure and activities.

Performance related effects: hybridity can serve as an incentive to increase effectivity also in the provision of public services but can also make organizations neglect their public tasks in favour of their commercial activities. Performance related effects are especially to be expected in organizations that are hybrid on the dimensions of my multi-dimensional model summarized as dealing with structure and activities.

Cultural risks: hybridity can trigger organizations to combine the best of both worlds by bringing the most prominent values of the public and the private sector together but It can also create cultural conflicts as private sector values are introduced which are commonly seen to be stronger than public sector values as they are based on individual self-interests rather than on altruism. Cultural effects are especially to be expected in organizations that are hybrid on the dimensions of my multi-dimensional model summarized as dealing with strategy and culture.

Governance related effects: hybridity can have a positive effect on an organization’s relationship with its political principals but can also lead to opportunistic behaviour when organizations decide to solely pursue their commercial goals. This makes hybrid organizations less dependable partners for their political principals in the provision of public services. Governance related effects are especially to be expected in organizations that are hybrid on the dimensions of my multi-dimensional model summarized as dealing with governance and politics.

Even though many treat the possible effects of hybridity as mutually excluding, they are, when examined more closely, often two sides of the same coin. One can never choose only the one and not the other: hybridity is a heads and tails issue. Each positive effect has a flipside and vice versa. Hybridity’s benefits can also be brought to fruition when its risks are properly contained and managed.

You can read more about the effects of hybridity and how they occur in practice in my book.