Management Theory and Practice: Organizational Outcome Analysis

This essay provides a comprehensive analysis of the role of managers in shaping organizational outcomes, focusing on the application of management theories. It delves into the impact of agency theory, emphasizing the importance of effective communication and alignment between principals and agents to achieve business goals. The essay also examines deterministic theories, including resource dependency and institutional theory, to illustrate how managers can utilize resources, build internal structures, and adapt to external demands to enhance performance. The discussion includes critical evaluations of the strengths and weaknesses of each theory, supported by scholarly research and real-world examples, such as the case of Inditex and Uterque. The study concludes by highlighting the significance of strategic choice theory in providing organizations with a broader range of options for success. This paper is a valuable resource for students seeking a deeper understanding of management theories and their practical implications.

Running head: MANAGEMENT THEORY AND PRACTICE
Management Theory and Practice
Name of the Student
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Author’s Note

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Topic: Role of managers in shaping organizational outcome
Introduction:
The role of an efficient manager is not only to control the entire process of business by
implementing different effective strategies and policies. Organizations in order to get a positive
outcome in terms of revenue as well as recognition tend to focus on the performance level of
employees. Work becomes monotonous when the employees do not get any motivation and
cooperation from the managers. Therefore, the managers have to play a major role in achieving
the success of business. This very specific study has provided in-depth critical analysis on how
agency theory and determinist theory leave a major impact in getting positive outcome from the
organization. The study has focused to evaluate the impact of agency theory in enhancing
business performances.
As emphasized by Cummings and Worley (2014), every organization in order to run their
business process in the market has to set a proper goal or target. It is undeniable that there is a
difference between business goal and employers’ desire. At the same time, business principals
and agency has to maintain a proper relationship for achieving the success. On the other hand,
deterministic theory is defined by numerous eminent scholars in various ways in an
argumentative way. Deterministic theory indicates that business experts should have the
capability of determining the business goal. This particular concept has been highly criticized by
many scholars. As per the point of view of those scholars a company while maintaining their
business wings cannot determine their target or goal. They can fix an expected goal based on
which employees are directed towards the services. This very specific study has focused to

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evaluate an in-depth overview about the contribution of various aspects of agency theory as well
as deterministic theory for getting organizational outcome.
Discussion:
Agency theory leaves major impact in rendering satisfied revenue growth for the
business organization. As per the point of view of Wong and Laschinger (2013), organizations
have to face immense challenges in order to maintain a proper balance between goal and desires.
In many cases it has been observed that companies fail to meet the business target parent
companies have to face challenges in maintaining a good rapport with the agencies due to the
lack of cultural barrier as well as psychological barriers. In order to get a positive business
outcome the employers need to maintain proper organizational structure by directing the
managers properly towards business goal. Principals should have a concern about the estimated
target fixed by the agencies. In addition, the employers may provide required resource to the
agencies so that the organization can reach the business target. Fleenor et al. (2014) stated that
the organizational managers of every single agency should have individual desired target so that
they can direct the employees towards reaching the business goal. A particular business
organization is constituted with employees of different cultural and psychological backgrounds.
The role of managers is to provide equal co-operation and support to every single employee.
Agency theory enables that business managers of every single agency have to maintain effective
communication with the principal so that they do not have to face difficulties in meeting target.
As per the concept of agency theory an individual agency or subordinate company has to
think about the success of others. If a particular subordinate fails to perform well due to
technological barrier or any other reason the other agencies have to spread their hands in

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showing a co-operative outlook and overachieving the business target. Hoon Song et al. (2012)
stated that the principal does not have to face difficulties in overcoming the loss done by
underperforming agency. Therefore, as per the theoretical concept of agency managers of every
single organization have to perform well in order to meet an overall target of business.
The primary goal of agency theory in maintaining corporate governance is to maintain
effective relationship between principal and agents. Ford and Richardson (2013) stated that
problem arises when the level of interest between the principal and agents differ at a certain point
of view. For an example, the primary business objective of Inditex is to follow autocratic form of
leadership style at the workplace so that the managers can change their organizational policies
for overcoming any kind of sudden crisis. Uterque is the successful and leading agency under the
governance of Inditex. As per the business policy of Uterque managers’ participative form of
leadership style is the most effective strategy for getting good performances from the employees.
However, as per the business concept of Uterque managers, the leaders should never impose
their own decision on the employees.
Nielsen and Randall (2013) stated that employees can get flexibility in sharing their point
of view regarding the business goal. As a result, they can get enough inspiration in performing
well for further progress. However, instead of working under Inditex the company like Uterque
intends to follow different leadership style for the further progress of business. As a result, the
internal relationship between the principal and agency is not very strong. This particular
relationship has rendered a major negative impact on the overall business performances. The
revenue growth of Inditex has been decreased due to the lack of effective performance of
Uterque. This very specific study has focused to evaluate through agency theory that both the
principals and agencies should maintain proper communication for meeting business target.

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Nielsen (2013) opined that managers are the most concerned persons who can maintain the work
harmony of two different structural bodies. As per the strategies formed by principal the agency
manager should maintain the work trend within organization.
Different conspicuous scholars have provided various argumentative opinions
regarding the concept of deterministic theories. As per the point of view of Donate and Pablo
(2015) every organization has to determine the business goal and objective before staring the
business. The responsibility of managers is to provide appropriate guidance and direction to the
concerned employees so that they can meet the business target. As a result, the organization
becomes successful in achieving the estimated target of business. This very specific concept has
been interpreted by numerous eminent research scholars in different ways. As per the opinion of
Jacobs et al. (2013), business experts can make strategies and policies in order to reach expected
target. While running the wings in different geographical markets the employees as well as
managers have to face innumerable difficulties both internally as well as externally. Therefore,
the experts should not make any determination regarding achieving the goal. Deterministic
theories are constituted with different aspects as well as components that help the business
managers to direct the employees for achieving business success. However this very specific part
has focused to make an in-depth critical evaluation about the impact of different deterministic
theories for rendering the success of business.
Resource dependency theory enables the business managers on how to get positive
business outcome by depending on the resources. Alegre and Chiva (2013) opined that managers
would be able to perform well only when they would get sufficient resources for achieving the
business target. Resources that are highly needed for controlling the entire process of business
include human resource, technological resources, physical resources and financial resources.

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Human resources is one of the most significant factors based on which the success of business is
highly dependent. Managers in order to meet a business target need well structured team who
would be able to provide effective services amidst large number of barriers. Technological
resource is highly needed that enables the organization to maintain chronological data record.
Von Krogh, Nonaka and Rechsteiner (2012) stated that the managers in order to keep a constant
control over the entire business process have to be accustomed with the advancement of
technology. In addition, the managers have to know how to overcome sudden technological
barriers so that the entire rhythm of business does not get affected. This very specific study has
provided in-depth overview on how resource decency theory evaluates the importance of
financial resources for achieving the peak of success.
Krasnikov and Jayachandran (2013) opined that the managers in order to get business
outcome should focus on the performance level of every individual. If an individual employee is
not competent enough in performing well that individual employee should be provided training
and development session. The role of an efficient business manager is to identify the employees
who need training for performance enhancement and refer them to the concerned human
resource department. However, in order to provide an effective training and development session
the organization should have proper financial resources so that the employers can afford money
for the purpose of training and development.
However, after evaluating the different components of resource dependency theory it can
be evaluated that resource plays an important role in motivating the managers for maintaining
their performance level. This very specific concept is one of the major aspects of deterministic
theory. In order to determine the business objective and goal the organization needs to have
sufficient resources. As stated by Tangirala and Ramanujam (2012), the business managers of

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Iconic in past few years have faced innumerable challenges in maintaining their e-commerce
supermarket chain due to the lack of sufficient technological equipment as well as efficiency. In
comparison to the number of employees the organization like The Iconic did not invest sufficient
number of advanced technology. As a result, customers’ service was getting affected day by day.
Institutional theory implies that in order to gain the competitive advantage the business
organizations need to focus on maintaining an effective internal structure. Along with
maintaining the proper management hierarchy the organization has to focus on keeping up
proper organizational behavior and culture. Managers need to make an effective communication
with the employees. The managers need to make an effective interpersonal communication with
every single employee in order to know their personal issues at the workplace. Hu et al. (2012)
stated that in order to maintain the workplace flexibility the business managers need to focus on
implementing flexible leadership style for communicating with the employees directly.
Democratic form of leadership style enables the employees in following a proper leadership style
with the help of which both the managers and employees can equally participate in making
collective decision. Employees automatically tend to show their courageous attitude for
performing well towards the business services. Therefore, using participative form of leadership
style at the workplace is a form of business strategy with the help of which managers get best
endeavors on behalf of the employees for reaching the business goal.
After evaluating the various aspects of deterministic theories it can be concluded that
managers should not determine business goal and objectives while running the business in
market (Nielsen 2013). As per the changing needs and demands of the customers the business
managers have to face immense difficulties for fulfilling the customers’ desire. Institutional
theory is one of the most effective ways of encouraging both the managers as well as employees

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for providing effective services. Rycroft-Malone et al. (2014) opined that employees would like
to perform well after getting motivational approaches from the managers as well as business
leaders by implementing deterministic theories.
Conclusion:
The overall study has focused to make an in-depth overview about the role of managers
in shaping organizational outcome. Different forms of theoretical concepts have been discussed
in this very specific study by highlighting the contribution of managers. Numerous eminent
scholars have provided their own opinion regarding the importance of deterministic theories as
well as agency theory for enhancing the performance level of managers has been critically
evaluated in this specific study. After making an in-depth critical analysis it can be concluded
that initiation of the strategic choice theory will help the organization to have more choices to
select from. On one hand, agency theory enables the managers for making a relationship between
principals and agency. On the other hand, the organization tends to follow deterministic theory
for setting a proper business goal and objective.

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