OT

OT 2019

OT 2019


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Cartes-fiches 182
Langue Deutsch
Catégorie Jeux de questions
Niveau Université
Crée / Actualisé 15.04.2019 / 09.06.2019
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Ecology of Organizations

Underlying concept of organization

  • organizations have a specific "blueprint" (e.g. business model)
  • organizations are inertial, they can hardly change

Unit of analysis

  • population of organizations (companies in particular)
  • (population defined by common blueprint)

Starting point of evolution: Blueprint (analogously to genes)

Evolutionary Mechanisms in Organizational Ecology

  1. Variation: new alternative blueprints → new companies
  2. Selection: positive/negative selection of new blueprints, criteria: profitability and legitimacy → market and societal environment
  3. Retention: integration and retention of selected blueprints → societal institutionalization and bureaucratic routines

1. Variation

Trigger (e.g. new technology) → new business models → startup

2. Selection

  • economic efficiency (profitability)
  • societal acceptance (legitimacy)

"From an organization ecology perspective, it is the environment which optimizes."

3. Retention

"Knowledge of previously successful forms is institutionalized in the socialization apparatus of societies - schools, families, churches, public agencies - and in cultural beliefs and values defended by dominant organizations and institutions."

7.3 Empirical Studies (exemplary)

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Effect of Size on Organizational Failure

Hypothesis: Liability of Smallness

Small organizations have higher failure rates because of:

  • lack of reliability and legitimacy
  • difficulty of raising capital
  • problems of recruiting and training a workforce
  • higher interest payments
  • costs of compliance with regulations

Empirical Test: consistent with the argument

 

Effect of Age on Organizational Failure

Hypothesis: Liability of Newness

Young organizations ahve higher failure rates because of:

  • need to learn new roles and create routines
  • limited resources
  • lack of endorsement (legitimacy)
  • costs of compliance with regulations

Empirical test: no effect when size is controlled

Resource Partitioning Model of Organizational Ecology

7.4 Critical Appraisal of Organizational Ecology

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Importance of the Theory (3)

  • Explanation of change in population of organizations
  • New perspective in organizational research (focus on populations)
  • Empirically testable

Critique on Organizational Ecology Theory (3)

  • Concept of population is unclear and thus it is difficult to distinguish between populations
  • Empirically: Foundation of new companies is not the dominant mechanism of variation, elimination of companies is not the dominant mechanism of selection
  • Influence of individuals (e.g. managers) is ignored

Summary: Organizational Ecology as Organization Theory

Module 8: New Institutionalism

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8.1 Core Concepts: Legitimacy and Institutions

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Definition of Institutions

Societal rules or expectations that are taken for granted or treated like "facts"

Definition of Legitimacy

Legitimacy is a generalized perception that structures or actions of an organization conform to the existing institutions

8.2 Institutional Environments and Organizational Structures

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Technical Environment

  • Products and services are exchanged through markets
  • Organizations strengthen their competitive advantage by effective controlling of work processes

Main Criteria: Efficiency

Institutional Environment

  • Demonstrate conformism with institutionalised rules
  • This way gain legitimacy and support from the environment

Main Criteria: Legitimacy

Combination of Technical and Institutional Environement

Matrix

Institutional Environment

strong                                            weak

strong             bank, hospitals                               industrial companies

weak               psychiatric hospitals, churche        restaurant, fitness centers

Technical Environment

Structure of the Argument

Survival of organizations: Organizations, which include in their formal structure social legitimated and rationalized elements, maximize their legitimacy, ensure the flow of resources and so improve their survivability.