Understanding Organizations

Understanding OrganizationsArguments for Combining the 3 PerspectivesOverviewThe various perspectivesArguments for combining those perspectivesThompsons Levels ModelScotts Layered ModelOrganizationsAre ubiquitousAccording to Parson (1960), the development of organizations is the principal mechanism by which, in a highly differentiated society, it is possible to get things done, to achieve goals beyond the reach of the individual. Organizations as an area of study emerged within sociology from the time of Max Webers seminal work on bureaucracy translated to English in 1946-47The PerspectivesRational Systems perspectivesNatural Systems perspectivesOpen Systems perspectivesRational Systems PerspectiveThe rational systems perspective defines organizations as collectivities oriented to the pursuit of relatively specific goals and exhibiting relatively highly formalized social structures (Scott & Davis, 2007).In other words, the rational systems perspectives view organizations as collections or groups that are formal and are built to pursue specific goals.Rational Systems (cont)Key Classical TheoristsMax Weber BureaucracyFrederick Winslow Taylor Scientific ManagementHenry Fayol Administrative theory

Heavily criticized for completely ignoring the huge impact of the environment on the organization.

Natural Systems PerspectiveThe natural systems perspective defines organizations as collectivities whose participants are pursuing multiple interests, both disparate and common, but who recognize the value of perpetuating the organization as an important resource (Scott & Davis, 2007).In other words, organizations are social systems that seek to survive.Natural Systems (cont)Key Classical theoristsDurkheim, Parsons, Barnard, and Mayo social consensusMarx, Coser, Gouldner, Bendix, and Collins Social conflictDisagrees with the Rational systems theory on the relevance of goals and the importance of a formal structure in organizationsOpen Systems PerspectiveOpen systems perspective defines organizations as collectivities of interdependent flows and activities linking shifting coalitions of participants embedded in wider material-resource and institutional environments (Scott & Davis, 2007).In other words, organizations are activities that involve groups of individuals with varying interests working together in an environment. Open Systems (cont)Key theoristsBoundling level of complexityLawrence and Lorsch Contingency theoryWeick personal uncertainty

Recognizes that the organization exists in an environment that continuously shapes and supports it.Combining PerspectivesThompsons Level Model

Scotts Layered ModelThompsons Levels ModelDifferentiates among three levels within organizations

The technical level The managerial levelThe Institutional level

Thompson: Organizations strive to be rational although they are natural and open systems.

Rational system perspectiveNatural system perspectiveOpen system perspectiveThe technical levelthat part of the organization carrying on the production functions that transform inputs into outputs.Rational notions of effectiveness and efficiency presume a closed system.Organizations attempt to seal off their technical cores from external uncertainties as much as possible. The managerial levelthat part of the organization responsible for designing and controlling the production system, for procuring inputs and disposing of outputs, and for securing and allocating personnel to units and functions.managers mediate between the open institutional level and closed technical level and need the flexibility of informal structures prevalent in the natural systems perspective to ensure organizational survival.

The institutional levelthat part of the organization that relates the organization to its wider environment, determines its domain, establishes its boundaries, and secures its legitimacy.the organization is open to the environment and must adapt to its changes. Scotts Layered ModelThe systems perspective is not a simple linear progressionHe observed that as open system models invaded organizational studies, instead of replacing the rational and natural system models, they were rather rapidly combined with both rational or natural system assumptions and arguments.Scotts Layered Model (cont)i.e. the open system models that developed in the 1960s did not supplant either the rational or the natural systems arguments but strongly challenged and eventually displaced the closed system assumptions underlying earlier formulations. as the transition from closed to open system models was happening, a second trend became obvious - there was the shift from rational to natural system models of analysis.Layer classificationHe classified the layers into four periods:closed rationalclosed naturalopen-rationalopen naturalLevels of AnalysisSocial Psychological deals with individual level of analysis of characteristics like creativity, performance, ethics, cooperative behaviour and productive.Structural deals with analysis at the group level comprising detailed appraisal of inter-group disagreements, composition of hierarchy, interpersonal communication, etcEcological comprises detailed analysis of an organizations culture, inter-organizational conflicts and environmental variables.

Closed-rational modelsKey theorists Taylor, Simon, Weber and FayolTaylor and Simon focused on the social psychological level using the rationalization of mechanical workWeber and Fayol focused on the structural level.

Closed-natural modelsKey theorist White, Barnard, Mayo, GouldnerThe social psychological level of analysis was focused on human relations such as details of work groups and worker-manager relationsOn the structural level, emphasis was given to both the internal structure and the wider environment.

Open-rational model (social psychological level)Simon and March are the major proponents of this level. In working together, they propound a bounded rationality. Decision makers and organizations are seen to be more open to the environment.Performance programs - make critical decisions in the occurrence of adversities since organizations often face such dynamic environments and must therefore initiate innovation and formulate metaprograms to meet the dynamics of the performance programs as well.Open-natural model (social psychological level)Weick maintains the cognitive steps of organizational participants as operating in an evolutionary mode other than rationality.This includes trial and error, change, superstitious learning and retrospective sense making yet he does not see it as a means to improvement, he is of the conviction that success in organizations can occur without any necessary increase in the productivity or viability of the systemStructural levelKey theorists Udy, Pugh, Hickson, and BlauAt this level, the formal structure is viewed in terms of size, technology and uncertainty but mostly on the characteristics of the environment of the organization.Simultaneously, they identified that organizations are aiming at developing effective and efficient structures into a rational system perspective.Ecological levelThis level evolved as more light was thrown on the environment of the organization.Organizations are assumed to devise structures that better enable them to adapt to the specific environments in which they operateAttention is concentrated on a given organization and the characteristics of its environmentAnd it has consequently paved way for theories like contingency, transaction cost, resource dependence, population ecology, institutional and network theories.

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