Week Three: Understanding The Environment In Which Organizations Function

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Week ThreeUnderstanding The Environment In
Which Organizations Function
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Objectives for Week Three

• Discuss the Feeding Frenzy Case
• Discuss Different Theories of How Organizations
  Respond to Their Environment
• Rethinking Ryans Argument
• Short Paper Assignment 1

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Sort Into Your Consulting Groups and Complete the
Following

• Evaluate Colers leadership style. Can you think
  of other ways a new manager may have approached
  the HRS?
• What else could Coler have done during the
  initial media turmoil over his ethics?
• How could Coler have better handled the McGee
  controversy and the media scrutiny that followed?
  
• How was Colers preparation for the hearing key
  to its positive outcome?

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Case Study Questions

• Who are the key actors?
• What is the organizational context?
• What are the characteristics of the environment?

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Case Study Questions

• How do you evaluate Colers leadership style?
• What are the strengths and weaknesses of Colers
  initial management decisions?
• How else might he have acted?
• How could Coler have better handled the McGee
  controversy and the media scrutiny that followed?
  
• How was Colers preparation for the hearing key
  to its positive outcome?

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Environmental Factors

• Cultural Technological
• Educational Political
• Legal Natural Resources
• Demographic Sociological
• Economic

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Uncertainty in Environment

• To be successful, organizations must obtain
• Information about the environment
• Resources from the environment
• Environmental uncertainty affects how
  organizations seek information and resources
• Two dimensions of environmental uncertainty
• Complexity versus Simplicity
• Stability versus Dynamic Change

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Dimensions of Uncertainty
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Open Systems Approach

• Cannot study organizations w/o studying the
  surrounding environment
• Survival and adaptation key concepts
• Number of prominent theories of how the
  environment shapes organizations
• Contingency Theory
• Resource Dependency Theory
• Population Ecology
• Institutional Isomorphism

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Population Ecology Theory

• Environment selects viable types of organizations
  in a Darwinian fashion
• Most fit organizations garner more resources
• Inertial features of organization limit
  adaptation
• Assumes competition and different organizational
  varieties

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Resource Dependency Theory

• Organizations attempt to manage their environment
  to ensure access to resources
• Strategic choices are made to secure resources
• Autonomy
• Ability to manipulate market/competition
• Limited information leads to different
  interpretations of environment and variation in
  strategies
• Importance of internal power

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Institutional Isomorphism

• Organizations adapt by imitating what is
  occurring in like organizations
• Perceptions of success
• Norms of professionalism
• Organizational forms will become more homogeneous
  over time

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Comparing Models of Adaptation

• Population ecology, Resource dependency,
  Institutional isomorphism
• How do each of these models define success and
  effectiveness?
• What is missing from each models notion of
  success and effectiveness?

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Steps Organizations Take When Responding to
Environmental Uncertainty

• Positions Departments
• Boundary-Spanning
• Planning Forecasting
• Political Activity
• Interorganizational Linkages

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Successful Adaptation

• Depends partly on an organizations strength
  prior to environmental shock or change
• Depends partly on the types of leadership
  initiatives taken within the organization
• Organizational health important

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New Landscape for Nonprofits

• What changes in the environment does Ryan
  describe?
• What strengths do for-profits bring to social
  service delivery?
• How have nonprofits and governmental
  organizations adapted? Implications?
• Would Ryans article look different today?

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Readings to Be Completed for Next Class Period

• Rainey, Chapter 11
• Khademian - coursepack
• Zdenek coursepack
• Memorandum of Understanding due next week
• Short Paper Assignment 1 due in Week 5