Paper on Organizational Strategic Theories
Added on 2020-05-01
8 Pages2437 Words95 Views
Leadership Management
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INTRODUCTIONThe economy is driven by organizations which seek to produce a product or provide aservice as required by the users. Organizations can’t exist in isolation hence they must interactwith other institutions to access raw materials or supplies which they make into a product andsend it out as a finished sample. Each organization is a social entity which comes up with goalsand operates on deliberate structures with identifiable boundaries. They seek to respond to andcreate value to satisfy the human needs in terms of knowledge, values and vision. It is a humancreation whose operation and yields are obtained from the ways we govern them and of thesocial, institutional and political structures within which they operate. To run well, anorganization needs to come up with a strategic plan. This plan is useful in governing theoperations of a company over a long period of time for instance for about five years before it isreviewed. In that given period, a number of targets are set and they need to be met for the growthof the company. Organizations have adopted different trends in the current economy (Baltzell,n.d.). The open system view of an organization can be described as shown in the illustrationbelow,
This paper seeks to analyze the different theories under organizational strategic anddeterministic processes. The theories that are critically analyzed in this research proposal are theresource dependent theory, the population ecology, and the institutional theory. The next sectioncritically analyses the implementation of each theory in the current organization structure. Thepaper responds to the research question which seeks to find out the author’s perspective on themost compelling strategic choice or determinism with reason. The conclusion restates the mainperspective and the response as critically discussed in the next section. The main and mosteffective theory still applicable in the modern age is the resource dependence theory. Everysingle organization is set to reduce costs while maximizing profits. All the strategic plans maderevolve around this concept. To increase the yields, the resources must be well managed and theorganization may need to obtain the raw materials more cheaply. In the business world there areincidences of takeovers, mergers, and acquisitions all the time. All these strategic moves arebased on the need to manage resources (Archer, n.d.). Every organization deals with customers,suppliers, distributors, regulatory agencies, competitors, unions, partners, and special interests.
The organization deals with uncertainties from the internal and external environments. Moreuncertainty results when the organization has to deal with complex, changing or poor-qualityelements. This paper discusses the theories that handle the environment relationships of anorganization to another or others.ORGANIZATION STRATEGIC AND DETERMINISTIC THEORYResources Dependent TheoryOne of the main aims of an organization is to minimize its dependence on otherinstitutions. Dependence on other organizations has a cost implication especially when scarceraw resources are being provisioned. The resource dependence theory seeks to explore how anorganization can exert influence over others so as to obtain the resources as well as responding tothe needs of other institutions in its immediate environment (Bansal, et al., 2011). Organizationscan have either symbiotic or competitive interdependencies. They obtain scarce and valuedresources form environments. There is a desire in each entity to control resources to minimizethe dependencies. The processes and transactions used to obtain resources develop dependencies.The balancing act of maintaining autonomy and recognizing dependencies is a plausible strategyfor a given entity. A company can opt to choose an interorganizational strategy that provides themost reduced uncertainty with least loss of control. the organization can maintain a symbioticinterdependence with other organizations by developing a good reputation and co-optation, orimplementing strategic alliances. Good reputation and trust are the most common linkagemechanisms in this relationship as well as having the interlocking directorate where a director inone company sits also in the board of another company (Carter, n.d.). The resources refer to thehuman resource, the raw materials, and the networks that ensure the business cases are relevantat each point in time. There is a trend in the formulation of alliances in the management of
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