3. Organisational Environment Flashcards
What are the five components of Porter’s Five Forces model?
New entrants Customers Suppliers Threat of substitutes Competitive rivalry
What are the two general categories of organisational environment?
Micro and macro
What are the six components of the PESTEL model?
Political Economic Social Technological Environmental Legal
What two strategies did W. Richard Scott identify for protecting an organisation’s boundaries?
Buffering techniques
Boundary spanning
How do buffering techniques defend an organisation from external shocks?
A buffer allows the organisation to exert more control on inputs and outputs by creating a facility that can be drawn on as required or discarded when not needed.
Give some examples of buffering techniques.
Reserve of part-time staff
Use of purchasing agents: will be able to secure supplies in competitive environment
How do boundary spanning techniques help an organisation defend its boundaries?
Enable organisation to get information about outside environment
and also to represent itself to the environment
List two specific modernist theories of the environment
Contingency theory
Resource dependency theory
— theory emphasises the relationship between the organisation and its environment
Contingency
— — theory emphasises the mutual dependency of the organisation and its environment for resources
Resource dependency theory
According to resource dependency theory, the management function should be aware of and exert control over the — — for competitive advantage and survival
Critical dependencies
The general strategy of resource dependency theory is for the organisation to create — by others upon it
Dependencies
List some of the specific strategies of resource dependency theory
Vertical integration Stockpiling Buying up competitors' patents Using multiple suppliers Creating barriers to marketing through high levels of advertising
List two symbolic-interpretist models of the business environment
Enactment theory
Institutional theory
Who is the chief proponent of organisational theory?
Karl Weick
What is the principal feature of enactment theory?
Individuals and organisations construct (enact) their environment by talking about it.
— theory argues for a greater degree of influence by the environment on organisations
Institutional theory
According to institutional theory, — is pressure to conform to the moral, social and cultural values of society
Institutionalisation
According to institutional theory, organisations tend to adopt the — and — expected of them
Behaviour and characteristics
Name a prime example of institutional theory in the UK
The corporate governance code: pressure to conform
