Strategic Choice and Deterministic Models: Analysis and Comparison

This essay critically analyzes two prominent theoretical perspectives in organizational theory: deterministic and strategic choice models. It begins by summarizing the core tenets of each approach, including institutional theory, resource dependence theory, and population ecology within the deterministic framework, and the strategic choice theory's emphasis on managerial agency. The essay then provides a detailed critical analysis, highlighting the limitations of each deterministic model, such as the constraints imposed by institutional theory, the failure of resource dependence theory to account for environmental changes, and population ecology's underestimation of managerial influence. The essay argues that strategic choice is a superior model because it acknowledges the agency of organizational leaders and their capacity to influence organizational outcomes through strategic decision-making, ultimately influencing organizational performance and operational contexts. The essay concludes by emphasizing the strategic choice approach as the most effective in addressing the weaknesses of deterministic models, recognizing the crucial role of management in shaping organizational strategies.

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 1
Strategic Choice and Deterministic Organizational Models
Student
Institution
Professor

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 2
The field of organizational theory has experienced stiff paradigm wars, with many
theoretical models competing to explain the factors that shape organizational action. An
organizational action is a field of knowledge that tries to explain how firms operate and why they
operate the way they do. In this essay, two theoretical perspectives- deterministic and strategic
choice have been analyzed. The essay has proven that strategic choice is a better model for
explaining the factors that shape organizational actions as it considers agency in its analysis. The
essay has two sections. The first section presents a summary of the models, while the second part
has given a highly critical analysis of the deterministic and strategic choice models.
Summary of the theories
The strategic choice theory developed by John Child examines the role that
organizational leaders or leading teams play in influencing a firm through decision making in a
dynamic political process. Battilana & Casciaro (2012), explain that the strategic choice
approach focuses on choices and decisions to be made in a particular scenario, irrespective of the
substance and timescale. The importance of this approach is that it highlights the subtle choices
and judgments involved in determining how to deal with uncertainties surrounding a specific
decision, it is incremental and expressed through a commitment package which ensures a
strategic agreement between the decisions to be made now and those that are to be made at a
later date and it is interactive, in that it is established as a framework for communication between
individuals of different skills and backgrounds (Bitektine & Haack, 2015). Therefore, it can deal
with three kinds of uncertainties in an organization- uncertainties relating to the guiding values,
working environment and related choices.
Conversely, deterministic theory of organizational action asserts that the environment
more or less controls itself. Welch, Piekkari, Plakoyiannaki & Paavilainen-Mantymaki (2011),

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 3
insist that in a deterministic model, organizations are forced to respond to the variations on the
marketplace and therefore must continuously watch out for any unexpected variations and
changes in customer patterns. The deterministic theories include population ecology, resource
dependence, and institutional approaches:
The institutional theory was established by Dimaggio and Powell in 1983. The primary
proposition of the theory is that firms tend to mimic each other in three primary ways-
normative, coercive and mimetic. In mimesis, firms in developed fields tend to copy each other
as a bulwark against uncertainty (Scaraboto & Fischer, 2012). In coercive mimicry, enterprises
have structures which are similar because they are exposed to similar external environmental
pressures. On the other hand, in normative mimicry, isomorphic procedures emanate from
professionalization of a field characterized by common standards, training, and practices which
lead to homogeneity.
Also, population ecology theory is based on natural selection. Aldrich and Pfeffer argued
that an organization changes due to the nature of resource distribution in its environment
(Bogaert, Boone, Negro & Van-Witteloostuijn, 2016). Therefore, according to this theory, the
environment dictates the forms of organizational actions and structure, which requires an
accurate sense of adaptation (Bogaert et al., 2016). A keen evaluation of this theory depicts that
organizational actions must be congruent to the current environmental variables. An action or
strategy which is not favored by the environment may therefore fail.
Resource dependence is another deterministic model. It argues that an enterprise’s
survival is dictated by acquiring and monitoring resources (Drees & Heugens, 2013). Indeed, a
notable overlap exists between this theory and population ecology. However, there are some
points of deviation especially relating to strategic choice. Population ecology depicts that

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 4
strategic choice is only possible under specific conditions. Besides, a majority of firms are
usually unable to make choices because of inter-organizational dependencies and challenges in
information processing (Pugliese, Minichilli & Zattoni, 2014). Resource dependence proposes
that a firm’s resources aid in determining organizational actions. Some resources that may help
an organization in executing its strategic actions include employees, physical assets, and
finances.
Critical Analysis
An organizational action is “a field of study which explains why organizations act the
way they do” (Geh., 2011, p. 27). Actions are the central determinants of an organization’s
strategy. Therefore, adopting an accurate theory is critical in evaluating a successful
organizational action. With this regards, it is important to critically evaluate the paradigm wars
between different organizational theories to identify the most appropriate approach:
Institutional theory concentrates on the environmental factors – internal and external,
such as norms, requirements, and rules that a firm must conform to receive support and
legitimacy. This theory relies heavily on societal constructs in defining the structure, actions, and
processes of an enterprise (Jewer & McKay, 2012). Conformity is the most common basic
principle of this theory. Under conformity, there are certain rational myths that a firm must
conform to like societal expectations. The theory specifically bridges the gap between
organizational action and societal views (Jewer & McKay, 2012). Therefore, the management
should be more willing to incorporate the opinions, views, rules, and expectations of the society
in its daily organizational operations.
Institutional theory has some limitations. The first disadvantage is that it places a lot of
constraints on the management to adhere to rules, norms or requirements (Pacheco, York, Dean

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 5
& Sarasvathy, 2010). High constraint levels may prove to be deleterious to the firm as it can
inhibit creativity, veracity, and diversity within a specific field. Therefore, managers who
conform to this theory may be unable to demonstrate creativity in their strategy formulation
processes, leading to redundancy.
Another limitation is that the management may have the minimal freedom to make
decisions which may alter the structural processes within the firm. This is because, the theory
advocates for conformity (Doerfel, Chewning & Lai, 2013). The employees may, therefore,
develop resistance to any decisions made by the management which go against the institutional
norms. This may make an organization unable to respond to the emerging environmental
variations creatively.
Resource dependence theory typically studies how the external organizational resources
affect the behavior of organizations. Firms depend on resources derived from the environment
for their actions and to fulfill their strategic goals (Brettel & Voss, 2013). Therefore the resource
that one organization needs may be held by another organization, creating independence between
them. For example, if organization A holds specific resources used by organization B, then
organization A has power over organization B. Hence, these resources act as critical capabilities
of a firm, making it necessary for an organization to consider them in executing strategic actions.
A primary weakness of the resource dependence theory is that it does not consider the
environmental changes that may influence a firm’s competitiveness. Studies have demonstrated
that organizational resources may only be fixed in the short-run, whereas in the long-run, it may
necessitate the management to modify the set of resources (Brettel & Voss, 2013). Therefore, it
cannot be concluded that the managers have no control over the environmental resources. The
theory of dynamic capabilities can be used to improve on this weakness.

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 6
Dynamic capabilities entail the ability of an organization to reconfigure and build internal
and external powers to address rapid environmental changes (Brettel & Voss, 2013). The theory
of resource dependence can only be relevant if it considers that the rare resources of an
organization are not enough to maintain their competitive edge if it cannot permanently
recombine them (Doerfel, Chewning & Lai, 013). Therefore, this theory cannot be relied on in
executing an organizational action.
Furthermore, although the resource dependence paradigm examines organizational
behavior about resources, it does not explain the role of the managers in the organization. The
managers occupy essential positions and can influence different strategies made by the firm
which may in return improve organizational performance (Doerfel et al., 2013). The performance
of the firm may also depend on how effectively the management uses the available resources to
help the firm attain its objectives. With this regards, this model may be viewed as inadequate.
The postulates of population ecology theory have elicited mixed reactions among
different scholars. This theory accurately highlights the role of environment in dictating the
survival of firms. According to Bogaert et al. (2016), the selection of different organizational
forms and structures in the level of populations of organizations happens due to structural inertia,
which acts as an explanation for lack of change. The notion that firms develop some structural
inertia that deters them from conducting radical changes as proposed by this theory has been
exposed to criticisms. The theory explains that when the inertial pressure is high, then it lowers
the adaptive flexibility of the firm. Some limitations of this theory have been described in the
following paragraphs:
The first weakness is by structural change. This theory proposes that managers are seen
as mere agents who cannot impose any structural change to the organization (Bogaert et al.,

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 7
2016). However, according to the human nature, human beings are proactive. Therefore, when a
manager evaluates a specific strategy and realizes that it is failing, then the organizational
structure may be changed to be more congruent to the strategy. Besides, longitudinal studies
have proven that changing structural orientations is possible with desirable results for firms
which implement it. Therefore, this theory can be disputed in favor of a strategic choice
approach, whereby the management can formulate rules, regulations and structural changes to
suit the changes in the environment.
The theory also assumes that the need for a radical change is usually present. This cannot
be necessarily true. Research has demystified this claim and proven that action windows are not
typically extensive (Pacheco et al., 2010). With regards to this, reference can be made to
Gersick’s theory of punctuated equilibrium where he punctuated it as a build-up of an extended
period of changes that are discontinued for a short duration of radical change. This only depicts
that firms are not obliged to make central transformations but be alert and attain the change
promptly.
Also, there is a wrong perception elicited by the theory that the environment cannot be
modified. Honestly, structural inertia may not apply equally to all enterprises (Pacheco et al.,
2010). Some large companies may have adequate resources and the capability to alter their
environmental conditions. For example, this was demonstrated at the time of financial crisis in
the US, when the government decided to offer financial support to companies which were
sensible to the US economy. Furthermore, companies regardless of their size have the freedom to
select the set of customers, competitors, and suppliers to deal with. This gives them the ability to
alter and redefine their operational and competitive environment.

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 8
The last criticism is that agents have the power to administer change. Ideally, individuals
and enterprises may suffer from cognitive limitations (Pacheco et al., 2010). However, an
organization’s collective ability to generate knowledge may exceed individual incapacities.
Furthermore, managers may also use the power granted to them in the organizational hierarchy
to administer change, which may encompass recruiting competent staff and altering the
organization’s operational structure. Therefore, a notion that management acts as agents without
the capacity to monitor the environment may not hold water.
To better address the limitations of the resource dependence, population ecology, and
institutionalization theories, the strategic choice theory can be used. According to the
explanations given by Junqueira, Dutra, Zanquetto Filho & Gonzaga (2016), the strategic choice
model was established in the 1970s to correct the weaknesses of the deterministic models which
overemphasized on environmental determinism at the expense of agency choice. Before Child
did his research in 1972, most researchers on strategic choice delved much on determinism and
did not recognize the element of agency in decision making (Barkema, Chen, George, Luo &
Tsui, 2015). According to this theory, managers are powerful and able to make effective strategic
choices which may influence the organizational performance standards and operational contexts.
Therefore, the deterministic theories cannot be regarded as adequate when they do not recognize
the roles of management in the organization.
The strategic choice is the best theory which can be used to explain the organizational
action. This is because it recognizes the relationship between the organization, the environment
and the dominant coalition (Managers) (Mahapatra, Das & Narasimhan, 2012). Managers hold
high hierarchies in the organization and therefore, are responsible for making strategic decisions

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 9
that may influence the way the organization operates and interacts with the environment. They
should therefore not be despised.
In conclusion, the strategic choice model is a more compelling theory in shaping
organizational actions. This is because it goes beyond the deterministic factors to recognize the
role of agency in decision making. Population ecology, resource dependence, and institutional
theories are deterministic and relate to the environmental variables that shape organizational
actions but do not recognize the role of the dominant coalition, hence making them inadequate.
This essay has, therefore, given a highly critical analysis which demonstrates how strategic
choice theory thoroughly demonstrates the factors that shape organizational actions and
performance.

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 10
References
Barkema, H. G., Chen, X. P., George, G., Luo, Y., & Tsui, A. S. (2015). West meets east: New
concepts and theories. Academy of Management Journal, 58(2), 460.
Battilana, J., & Casciaro, T. (2012). Change agents, networks, and institutions: A contingency
theory of organizational change. Academy of Management Journal, 55(2), 381-398.
Bitektine, A., & Haack, P. (2015). The “macro” and the “micro” of legitimacy: Toward a
multilevel theory of the legitimacy process. Academy of Management Review, 40(1), 49-75.
Bogaert, S., Boone, C., Negro, G., & Van-Witteloostuijn, A. (2016). Organizational form
emergence: a meta-analysis of the ecological theory of legitimation. Journal of
Management, 42(5), 1344-1373.
Brettel, M., & Voss, U. (2013). An Explanation from Resource Dependence Theory.
Schmalenbach Business Review, 65(4), 409-430.
Doerfel, M. L., Chewning, L. V., & Lai, C. H. (2013). The evolution of networks and the
resilience of inter-organizational relationships after a disaster. Communication
Monographs, 80(4), 533-559.
Drees, J. M., & Heugens, P. P. (2013). Synthesizing and extending resource dependence theory:
A meta-analysis. Journal of Management, 39(6), 1666-1698.
Geh, E., 2011. Understanding Strategic Alliances from the Effectual Entrepreneurial Firm's
Perspective-An Organization Theory Perspective. SAM Advanced Management Journal,
76(4), p.27.
Jewer, J., & McKay, K. N. (2012). Antecedents and consequences of board IT governance:
Institutional and strategic choice perspectives. Journal of the Association for Information
Systems, 13(7), 581.

STRATEGIC CHOICE AND DETERMINISTIC ORGANIZATIONAL MODELS 11
Junqueira, E., Dutra, E. V., Zanquetto Filho, H., & Gonzaga, R. P. (2016). The effect of strategic
choices and management control systems on organizational performance. Revista
Contabilidade & Finanças, 27(72), 334-348.
Mahapatra, S. K., Das, A., & Narasimhan, R. (2012). A contingency theory of supplier
management initiatives: effects of competitive intensity and product lifecycle. Journal of
Operations Management, 30(5), 406-422.
Pacheco, D. F., York, J. G., Dean, T. J., & Sarasvathy, S. D. (2010). The coevolution of
institutional entrepreneurship: A tale of two theories. Journal of management, 36(4), 974-
1010.
Pugliese, A., Minichilli, A., & Zattoni, A. (2014). Integrating agency and resource dependence
theory: Firm profitability, industry regulation, and board task performance. Journal of
Business Research, 67(6), 1189-1200.
Scaraboto, D., & Fischer, E. (2012). Frustrated fatshionistas: An institutional theory perspective
on consumer quests for greater choice in mainstream markets. Journal of Consumer
Research, 39(6), 1234-1257.
Welch, C., Piekkari, R., Plakoyiannaki, E., & Paavilainen-Mäntymäki, E. (2011). Theorising
from case studies: Towards a pluralist future for international business research. Journal of
International Business Studies, 42(5), 740-762.