This study explored the role of institutions in countries that have improved their competitiveness in a short time period, under the framework of institutional theory. This study investigated how informal and formal institutions have evolved and interacted. The purpose of the study was to build on institutional theory by exploring the role and interaction of institutions in nations that have undergone institutional changes. A literature review was done to provide a foundation for the study. Case studies of Singapore and Finland – countries that have improved their competitiveness in a short time period – were done in this study. A number of documents in the public domain were observed: internet resources, reports, and studies on Singapore and Finland. The study concluded that countries that have improved their competitiveness achieved their goals through their own institutional mix and through interactions among institutions. Active interactions among institutions were based on broad coalition among actors and the directions of interactions in each country differed.