Hybrid organizations are becoming increasingly popular in the public sector. This development has been going on for several years, both internally in the public sector, but also externally in relation to other principals and stakeholders. Not only organizations for managing public-private relationships can be seen as hybrids, we also suggest that public hybridization should be acknowledged, and that we have a lot to learn from an institutionalized form of hybridization (Evers, 2005; Powell & Castelli, 2017). In this paper, we claim that it is very difficult to create a well-functioning form of interaction between different institutionalized actors; it requires good ability to foresee, understand and manage complexity and goal incongruences; requires a well-founded view of what is a reasonable ambition level, and requires a strategic awareness of perspective differences and willingness to learn from differences in order to create shared ownerships.
Functional specialization, as a model of government organization is popular among resourceful citizens, professionals, bureaucrats and the majority of politicians. However, this prevailing welfare model is not always appropriate to solve problems for people with complex needs, such as long-term unemployment where vocational rehabilitation is needed (Löfström, 2010), long-term mental disabilities (Jensen & Kuosmanen, 2008), to solve complex social problems in large cities (Jensen, 2007). Even though functional specialization and control still remains as the role model how to organize public service production, exclusion of various kinds has become a major concern in the post-industrial society and a major challenge for the welfare state. The complex challenges mentioned above require the coordination of many specialized competencies; thus, coordination and collaboration between different professions, principals and systems are on top of the political and management agenda in all European welfare states.
In Sweden, as in most EU countries, several different actors are responsible for rehabilitation measures - state, regional and local authorities. It is primarily employers, social security agencies, health services, social services and employment services as collaborative efforts. Except in cases where the employer is not a public organization, decisions are made about the activities of these different actors of different political assemblies. Since 2003, there has been a legislation that regulates cooperation between authorities in the vocational rehabilitation field. The law makes it possible to form coordination associations (CA) with a common budget within a geographical area to finance joint activities for specific target groups.
This CA is an example of an institutionalized public hybrid organization, where the operational activity is based on interorganizational cooperation between different authorities in particular, but also non-profit organizations and companies are involved. (cf. Powell & Castelli, 2017; Skelcher & Rathgeb Smith, 2014). In addition to helping the long term unemployed with vocational rehabilitation, the operations have been treated with a range of interorganizational challenges - different sets of rules, areas of responsibility, cultures and governance structures, and, not least, various multi-level transfer arrangements. These differences are captured in the meeting between different institutional logics expressed in assumptions, values, beliefs, and rules produce and reproduce in the organization (Thornton & Ocasio, 1999).
