OTD Chapter 14 Managing Conflict, Power, and Politics Flashcards
Organizational Life Cycle (meaning)
A sequence of growth and development stages through which an organization might pass.
Stages of the Organizational Life Cycle
- Organizational Birth
- Organizational Growth
- Organizational Decline
- Organizational Death
Organizational Birth (stage, meaning)
- The founding of an organization (by entrepreneurs).
- The greatest chance of failure, due to liability of newness.
Population Ecology Theory
A theory that seeks to explain the factors that affect the rate wat which new organisations are born (and die) in a population of existing organizations.
Population of Organizations
The organizations that are competing for the same set of resources in the environment.
Population density
The number of organizations that can compete for the same resources in a particular environment.
R-Strategy
Entering a new environment early.
K-Strategy
Entering a new environment late, after other organizations have already tested the water.
Specialist Strategy
Organizations that concentrate their skills to pursue a narrow range of resources in a single niche.
Generalist Strategy
Organizations that spread their skills thinly to compete for a brand range of resources in many niches.
R-specialist
One niche, early entry.
R-generalist
Multiple niches, early entry.
K-specialist
Late entry, one niche.
K-generalist
Late entry, multiple niches.
Natural selection
The process that ensures the survival of the organizations hat have the skills and abilities that best fit with the environment.
Organizational Growth (stage 2, meaning)
The life cycle stage in which organizations develop value creation skills and competences that allow them to acquire additional resources.
Organizational Isomorphism
The similarity among organizations in a population.
Three processes that explain why organizations become more alike
- Coercive isomorphism
- Mimetic isomorphism
- Normative isomorphism
Coercive isomorphism
Pressured by other organizations or by society in general.
E.g., Nike, Walmart, and Apple being pressured by the general public to boycot goods made by children in developing countries. The companies responded by creating uniform codes of supplier conduct.
Mimetic isomorphism
Organizations intentionally imitate and copy one another to increase their legitimacy.
E.g., Fast-food chains mimicking how McDonalds standardised its global fast food network.
Normative isomorphism
Organizations that come to resemble one another over time because they indirectly adopt the norms and values of other organizations in the environment.
Employees and managers frequently move from one organization to another and bring with them the norms and values of their past employer. Most companies in an industry recruit managers from other companies in the same industry. E.g., Dell recruiting managers from PC.
Greiner’s Model of Organizational Growth
Phases that organizations go through as they grow. Each growth phase consist of a period of relatively stable growth, followed by a crisis indicating that organizational change is needed for the company to carry on growth.
Geiner’s Model of Organizational Growth (stages)
Stage 1: Growth through Creativity Stage 2: Growth through Direction Stage 3: Growth through Delegation Stage 4: Growth through Coordination Stage 5: Growth through Collaboration
Organizational Decline (Stage 3, meaning)
The life cycle stage that an organization enters when it fails to anticipate, recognise, avoid, neutralize, or adapt to external and internal pressures that threaten its long-term survival.
Organizational inertia (meaning)
Forces inside the organization that make it resistant to change.
Factors that cause (organizational) inertia:
- Risk aversion.
- Overly bureacratic culture.
- Desire to maximize rewards.
Risk aversion (meaning)
Managers being unwilling to bear the uncertainty associated with entrepreneurial activities.
Desire to maximize rewards (meaning)
Managers’ desire for prestige, job security, power, and strong property rights that bring large rewards often lead them to focus on strategies that increase organizational size, even if it reduces profitability and organizational effectiveness.
Overly bureaucratic culture (meaning)
In large organizations, property rights can become so strong that managers spend all their time protecting their specific rights instead of working to advance the organization’s interests.
Environmental changes affect an organization’s ability to obtain resources and may lead to organizational decline. What are the major sources?
- Complexity
- Dynamism
- Richness
Complexity (meaning)
The number of different forces that an organization has to manage.
Dynamism (meaning)
The degree to which the environment is changing.
Richness
The number of resources available in the environment.
Weitzel and Jonsson’s model of organizational decline (stages)
- Blinded stage
- Inaction stage
- Faulty action stage
- Crisis stage
- Dissolution stage
Blinded stage (meaning)
Decline begins because key managers fail to recognise the internal or external changes that will harm their organization. This blindness may be due to lack of awareness about changes or an inability to understand their significance.
Inaction stage (meaning)
As organizational problems become more visible, managers may recognise the need to change, but still take no action. They may wait for the problem to correct self. They don’t feel as if the situation is urgent.
Faulty action stage (meaning)
Faces with rising costs and decreasing profits and market share, management will announce belt-tightening plans designed to cut costs, increase efficiency, and restore profits.
Rather than recognising the need for fundamental changes, managers assume that if they just run the ship tighter, company performance will return to previous levels.
Crisis stage (meaning)
Bankruptcy or dissolution are likely to occur unless the company reorganises the way it does business. At this point, companies typically lack the resources to fully change how they run their business.
Cutbacks and layoffs will have reduced the level of talent among employees.
Dissolution stage (meaning)
After failing to make the changes needed to sustain the organization, the company is dissolved. A new CEO may be brought in to oversee the closing of stores, offices, and manufacturing facilities.
