Strategic Choice Theory and Organizations

This assignment examines the concept of strategic choice theory in relation to organizational analysis. It compares and contrasts this theory with deterministic approaches, highlighting the importance of strategic choice in allowing organizations to achieve their goals based on their internal capabilities and the external environment. The analysis emphasizes how adjustments are made considering both internal competencies and external factors influencing the organization.

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Table of Contents
Introduction:................................................................................................................................................1
Determinist theories:...................................................................................................................................1
Strategic choice theory:...............................................................................................................................3
Best approach:.............................................................................................................................................4
Conclusion:.................................................................................................................................................5
References:..................................................................................................................................................6

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Introduction:
Organisational action can be defined as the action or the decision that the organisations make in
order to perform some activity of business or organization. There are various factors that affect
the organization’s decision and its actions towards any of the situation. Different theories have
been formed by the theorist gat supports the management of the companies to make
organizational actions (Burrell and Morgan, 2017). The first theory that is talked about in this
essay is related to strategic choice. The strategic choice theory suggests that the organizations
and the leaders of the organization have a significant role to play in controlling the dynamic
environment of the business. Previously, the organisations were thought to be structured as per
the operational requirements of the external environment and this theory is called as the
deterministic theory. Both of these theories have different concepts and thus affect the
organizational actions in the outside environment of business. This essay provides the
information about the roles and contribution of these theories in the organizational actions. It
initiates with the discussion of deterministic theory that involves resource dependency based
theory, institutional theory and population ecology theory (Miner, 2015). The essay continues
with the discussion of contrasting theory that is strategic choice theory which is found to be the
best approach to be conducted.
Determinist theories:
Different organization has different design and structure and that structure is supported by some
kind of belief and theory which affect the decision and the actions of the organizations. Different
theories contribute differently in the organization. Determinist theory is one of the theories which
are based as the external and the operational requirements of the organization. This theory was
followed by the organizations in earlier times. As per this theory, the market place is the
controlling factors of the businesses and the organization has to response to the changes that
occurred in the market. Thus, the organizations have to continuously look for the changes and
the expectations of the market and make the changes in the organizational action as per the
changes outside (Shafritz, Ott and Jang, 2015). The goals of the companies should be aligned
with the market requirements and not with the organizational requirements. As the external

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environment of the business has many elements thus the organization is dependent on those
elements of the external environment.one of those elements is resources (Sergiovanni and
Corbally, 1986). The theory that has been developed for the dependency of organizations on the
resources is called resource dependency theory. Jeffery Pfeffer was the America theorist who has
developed this theory of RDT. The purpose of this theory is to present a guide that provides the
information about management of the organizations which are externally constrained. As per this
theory, all the organizations are dependent on the resources that can be obtained by the external
environment of the organizations in which other organizations are also included (Peters, 2011).
As all the organizations works in the similar environment thus it has been assumed that the
resources that are required by the organizations are controlled by other organizations operating in
the same environment. This suggests that organizations actions are directly linked with the
resource power they had in the environment. in this situation, the power of the resources with the
organizations are assumed to be dependent on the environmental factors which proves the
interdependency of organizational action in the resources that are not controlled by the
organisation itself but is the pat of external environment (Clegg, 2013). Another theory called
institutional theory came into existence that was based on resilient aspects of social structures.
This theory suggests that the organizations do not focus on their own decision and practices but
analyse the actions of other peers in order to respond to the environment. This is the theory that
is related to imitation. As per this theory, the organizations have to follow the rules and the
beliefs that are persisting in the environment because institutional isomorphism earns
organisational legitimacy and it was believed that organization can survive only when it
conforms to the rules in the environment (Feldman and Orlikowski, 2011). Companies that
operate in different international environment face pressure from the different institutions and
thus this theory of institutionalization is found to be unsuccessful in making efficient
organizational actions. It is already discussed that environment is the factors that affect the
organisational sections (Watson, 2013). The change in the environment forces the organizations
to make the relevant changes in order to survive. The theory called population ecology theory
suggests that organizations have some inertial restriction that restricts the organisations to make
the relevant changes as per the environment. The higher the inertial pressure faced by the
organizations, the lower the organization develops the capability of adapting the changes
occurred (essels and Terjesen,2010). The structural inertia in the organizations can be affected by

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the factors that are external or internal. The internal factors that affect the actions include the
policies f the company, improper information about the environment by the argument, political
struggle etc. On the other hand, the external pressures are legal and financial changes in the
external environment or the industry, external constraint or barriers etc.
The above discussion suggests that deterministic theories are related purely with the environment
of the company. The external environment of the companies has great impact on the
organisations actions. It has been analysed that the theories that has been discussed above were
not appropriate for all the organizations (Davis and Adam Cobb, 2010). As the last theory of
population ecology suggests that the organisations have to adopt the changes in the environment
but have to face many issues at the same time. So, a new theory of strategic choice has been
evolved to suppress the challenges face by the companies (Drees and Heugens, 2013).
Strategic choice theory:
Strategic choice theory focuses on the role of the management in the organisations. This theory
suggests that the leaders and the managers have the control over the organisational actions and
they can make the decisions of the organisations as per the structure of the organisation. This
theory pays attention to the internal body of management of the organisation rather than the
uncertain environmental factors (Salimath and Jones III, 2011). This theory considers the whole
process that needs to be followed by the organisation in order to take decision over the
organisational actions.
The processes have four elements. The first element is shaping. It is the step where the
management of the organisation used to identify the issues and shape the issue into an objective
on which the decision needs to be made or the actions needs to be taken(Hill, Jones and
Schilling, 2014). The next step is about designing. It is the step where the management or the
leaders of the company needs to design various alternatives and strategies to resolve the issue.
For designing the strategies, the organizations need to consider all the factors that can affect the
formation of the strategies and also have its impact on the organisational actions. The next step is
to compare. It is the step in which all the alternative strategies are being compared. The analysis
of benefits and disadvantages of the consequences of strategic implementation has been done so
that the best option can be selected. The last step is to choose the best alternative strategy for the

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issue. It I has been analysed that it is the theory that supports a kind of logic and merely not
depends the environmental changes (Talke, Salomo and Rost, 2010). It analyse the changes and
its intensity and after that the strategies are been made that can be implemented in the
organisation to attain the gaols of the company rather than to attain the gaols of the market.
Strategic choice refers to the process in which the power holders of the organisation have the
right to take the decisions over the strategic choice of actions that needs to be practiced by the
company. The strategic options can be made by evaluating the relationship of the external and
the internal environment of the organisations. The ability of the leaders to make the strategic
choice in the organisation depends on how far that strategy can helps the company to achieve its
gaols and maintain the consistency (Nielsen and Nielsen, 2011). The development of the
strategies choice theory is because of the dependency of the organizations action on the
environment. The strategic choice theory is the evolution of the environmental theory that is
deterministic theories. The theory of strategic choice initiates when the forces of external
environment of the company affect the organisation actions. Change in the external environment
of the company results in making adjustments and bringing alterations in the business strategies
of the company (Wheelen and Hunger, 2017). When the organisations make the adjustments, the
leaders started developing many feasible options. Out of these options, the leaders have to select
one of them which are most feasible and thus it is considered as one of the best approach to take.
Best approach:
Considering the strategic choice theory leads to the conclusion that deterministic approach was
inadequate to be considered for organizational actions. This is because it fails to provide the
power and options to the leaders of the organisation that are actually running the company’s
functions. It has been analysed that there were many drawbacks of deterministic theory of
organisation because it was not focusing on the initial contextual factors of the organisation
which also plays a great role in taking the organisational decisions. Difference organisations
have different situations and different beliefs. Thus, along with the outside environmental
factors, it is also required to consider those internal factors to ate the decision over the actions
that needs to be taken by the company in response to the changes of the industry or in order to
survive in the industry. Providing all the controlling power to the market is not the correct
approach to take the organization decisions. This is because following the similar rules and

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regulation of the industry and making the decision accordingly is impossible for all the
organizations. The internal differences and the approaches for functions has their impact of the
organisational decision and considering all the factors is the correct approach to take any of the
organisational actions.
Conclusion:
It has been concluded from the above discussion that strategic theory is one of the best
approaches that can be implemented in the organisation to make the organisational decision and
actions. It has more contribution in the organisational actions because it involves the contextual
factors from internal as well as external environment of the company. It has been summarized
from the discussion that there are two theories that can affect the organisation actions. The first
one is the deterministic approach or theory that includes population ecology theory, institutional
theory and resource dependent theory. All these theory considers the environmental factors of the
external environment of the company or the organisations. As the organisation starts getting
affected by the environmental contextual factors, they developed the capabilities of adopting the
changes. This evolves the theory of strategic choice. This is the theory that focuses on the leaders
of the organisation and provides powers of controlling the organisational actions to them. in case
of deterministic theory, all the power of taking decision were with the market and the
organisational have to make the changes according to the market demands. With the change in t
perspective of the company and the dynamic nature of the market, the organisations adopted the
approach of strategic choice hat allow the organisation to take the more feasible option after
developing many alternative strategies. This also involves the concept of contingency that was
not including in the theory of deterministic. When the comparison is done, it has been analysed
that strategic choice is the most relevant theory as it allow the organisation to attain their goals as
per their situation and internal competencies than the goals of the market. The adjustments that
have been made are also in terms of the internal competencies along with the external impact of
the organisations.

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References:
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Clegg, S., 2013. The Theory of Power and Organization (RLE: Organizations). Routledge.
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Shafritz, J.M., Ott, J.S. and Jang, Y.S., 2015. Classics of organization theory. Cengage Learning.
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