Org Theory Textbook Terms Flashcards
organization
a tool people use to coordinate their actions to obtain something they desire or value
entrepreneurship
the process by which people recognize opportunities to satisfy needs and then gather and use resources to meet those needs
organizational environment
the set of forces and conditions that operate beyond an organization’s boundaries but affect its ability to acquire and use resources to create value
economies of scale
cost savings that result when goods and services are produced in large volume on automated production lines
economies of scope
cost savings that result when an organization is able to use underutilized resources more effectively because they can be shared across different products or tasks
transaction costs
costs associated with negotiating, monitoring, and governing exchanges between people
organizational theory
the study of how organizations function and how they affect and are affected by the environment in which they operate
organizational structure
the formal system of task and authority relationships that control how people coordinate their actions and use resources to achieve organizational goals
organizational culture
the set of shared values and norms that controls organizational members interactions with each other and with suppliers, customers, and other people outside the organization
organizational design
the process by which managers select and manage aspects of structure and culture so that an organization can control the achieve necessary to achieve its goals
organizational change
the process by which organizations redesign their structures and cultures to move from their present state to some desired state to increase their effectiveness
contingency
an event that might occur and must be planned for
competitive advantage
the ability of one company to outperform another people its managers are able to create more value from the resources at their disposal
core competences
managers skills and abilities in value-creating activities
strategy
the specific pattern of decisions and actions that managers take to use core competences to achieve a competitive advantage and outperform competitors
external resource approach
a method managers use to evaluate how effectively an organization manages and controls its external environment
internal systems approach
a method that allows managers to evaluate how effectively an organization functions and resources operate
technical approach
a method managers use to evaluate how efficiently an organization can convert some amount of organizational resources into finished goods and services
official goals
guiding principles that the organization formally states in its annual report and in other public documents
missions
goals that explain why the organization exists and what it should be doing
stakeholders
people who have an interest, claim, or stake in an organization, in what it does, and in how well it performs
inducements
rewards such as money, power, and organizational status
contributions
the skills, knowledge, and expertise that organizations require of their members during task performance
authority
the power to hold people accountable for their actions and to make decisions concerning the use of organizational resources
chain of command
the system of hierarchical reporting relationships in an organization
hierarchy
a classification of people according to authority and rank
line role
managers who have direct responsibility for the production of goods and services
staff role
managers who are in charge of a specific organizational function such as sales or R&D
top-management team
a group of managers who report to the CEO and COO and help the CEO set the company’s strategy and its long-term goals and objectives
divisional managers
managers who set policy only for the division they head
