Discussion Thread: Introduction to Organizations and Organizational Theory
Chapter 1: Why is shared information so important in a learning organization in comparison to an efficient performance organization? Discuss how an organization’s approach to sharing information may be related to other elements of organization design such as: structure, tasks, strategy, and culture.
A learning organization, one that has an organic rather than mechanistic design, depends on low power distance between employees and flexible decision making. To do this, information cannot be kept by those at the top of the organization; it must be attainable and shared by everyone in the organization. Shared information is so important to learning organizations because they function so as to promote innovation among employees of all levels. Efficient organizations work towards using resources wisely and maintaining a large market share without necessarily creating new offerings like learning organizations do.
Learning organizations have a decentralized structure, where information is shared to lower level employees and they have more power to make decisions or do certain activities to reach company goals. Efficient organizations rely on a centralized structure, leaving decisions to higher ranking employees and lower ones to follow what management says in order to be as efficient as possible. There is also a difference between tasks and roles, with tasks being found in efficient companies while roles are in learning ones. Tasks are specific, specialized job requirements employees are expected to perform. Roles are more fluid, leaving employees to use their ingenuity and talents to meet goals without having to follow strict guidelines to do so.
Strategy choice can essentially determine if an organization leans to being efficient or learning. Strategy has been defined as “the plan of action that describes resource allocation and activities for dealing with the environment for reaching the organization’s goals” (Daft, 2021, p. 21). To be efficient means to use resources in the wisest way to make the most outputs, so efficient organizations need to have a firm stance on its best use of scarce resources. This is why efficient organizations keep information more to the top management, who devise strategic plans to maintain efficiency and ask that employees follow those plans to reach the company’s goals. But learning organizations do not focus so much on efficiency as they do on innovation. Being an innovator in the market means that rigidity in management or information sharing has to be kept lower than what is normally seen. Learning organizations thrive on employees working together with shared information to come up with new ideas and strategies to stay competitive in the market. Culture is another major design element that explains the choice of how much information is shared in a company. Efficient companies have corporate cultures set on efficiency and steady growth, executed through well-developed strategies that require all employees to be on the same page of the company’s values. Learning organizations, on the other hand, feature corporate cultures dedicated to breaking boundaries and creativity, which translates into the wide sharing of information and resources to employees throughout the company. Depending on what an organization’s mission and beliefs are, one can make an educated guess as to whether the organization is built for efficiency or learning.
Chapter 1: What are some differences that one might anticipate among the expectations of stakeholder for a nonprofit organization versus a for-profit business? Do you believe nonprofit managers have to pay more attention to stakeholders than business managers?
The difference in business activity between nonprofits and for-profits may not be too dissimilar, but the way each approaches their respective stakeholders can differ greatly. For-profits are mainly concerned with making money, pleasing shareholders, and obtaining customers. Nonprofits have to be even more careful about these tasks because they rely on the goodwill of donors, have multiple stakeholders that are needy and depend on charitable services, and customers are always around to serve but there are not always enough resources or volunteers to serve those who need the most help. For-profits may have an easier time partnering with suppliers or other companies because they too are in business to make profit. As long as for-profits are efficient, competitive, and increasing company value, then stakeholders will largely be satisfied with the company. Nonprofits have it harder because they depend on the desire to serve, not the desire to make money, which is much more common to the human condition than giving one’s time and efforts to someone without guarantee of receiving something in return. Nonprofit stakeholders are not oblivious to profits, however. They too must consider this as it is only from profits that nonprofit charity work can be offered to begin with.
Because of this multifaceted nature of nonprofits, managers within that realm do have to pay more attention to and be more cautious with its stakeholders. In nonprofits, more than money is at stake, and the typical focuses on efficiency and effectiveness in for-profits have higher stakes in nonprofits since they do not exist solely to make profit. Every resource nonprofits have, especially those from stakeholders, have to regularly be pursued and marketed, and then further divided to use them efficiently for services while also paying employees, if at all. This struggle of capturing stakeholders was analyzed by Mato-Santiso et al. (2021), who attempted to find gaps in the literature regarding nonprofits and how they interact with stakeholders. They found that nonprofits’ use of social media was effective, but struggled to stimulate interactions and be consistent with speaking to stakeholders online. Most of the advocacy from nonprofits was posted online through various channels, but the researchers claimed those organizations needed to find other ways besides websites and social media so their message and brand can be more visible. In addition, most of the emphasis in nonprofits to stakeholders was to donors rather than giving equal attention to beneficiaries of their services, another gap in stakeholder outreach. Overall, nonprofits have not found the perfect combination of online and offline methods to attract attention and relate to stakeholders.
Chapter 2: How might a company’s goals for employee development be related to its goals for innovation and change? How might a company’s goals for employee development be related to its goals for productivity? Explain the ways that these types of goals may conflict in an organization?
Employee development can be directly tied to organizational goals rather than just meant to enhance the skills and knowledge of employees individually. It consists of different kinds of training and growth initiatives designed to bring the company and employee to new heights. For organizations that want to achieve goals in innovation and change, employee development is critical. Innovative companies have to ensure their employees are always in the know about the newest advancements in technology and ways of doing business. By stretching their employees’ mental capabilities and offering educational tools to grow their skills, companies are investing in their employees so they can gain innovative advantages over competitors. As time passes, these employees can be the new leaders of the company, and since they have been developed to seek out innovation and change, they will be better equipped to tackle the presence of those two things within and outside the organization.
Companies that are in line with maintaining efficiency and productivity can promote employee development as well, but in a different manner. These companies will not necessarily train their employees to gain diversified and innovative skills, but instead train them to be better at their jobs or even teach them how to perform in other positions. Employee development in productivity-centric companies is more akin to an employee learning the ins and outs of their company to the point they become internal experts and can engender positive change as they climb the corporate ladder. That is not to say that companies working toward productivity do not innovate at all, it simply means they do not have innovation as a goal or priority. Katić et al. (2020) studied the effects of employee development on productivity and service quality, which would be goals of efficient organizations. They found that higher training costs and longer training periods were positively correlated to increased productivity and service quality. That may not be surprising, but what is interesting is that besides better productivity and quality of service, employee development also led to a higher level of profit and innovation. Even if a company wants to keep an efficiency model, they will still naturally promote innovation with employee development.
Depending on whether a company wants to develop employees toward innovation or productivity, there can be conflicts if the company is not set on its goals. Without a corporate culture that has a solid direction, there will be no way to figure out how employees should be trained and developed. If a company focuses too much on developing employees toward innovation, it may struggle to find a footing in the market and make steady profit to survive. If a company only wants to develop employees to be productive, they may fall behind advancements and tastes in the market, failing to keep with modern technology or using resources efficiently to create new outputs. There are other possible issues, such as how certain employees might receive more development than others and cause jealousy among them, or based on how much development employees receive there can be conflicts of power and authority in the company.
Chapter 2: Suppose you have been asked to evaluate the effectiveness of the police department in a medium-sized community. Where would you begin? How would you proceed? What effectiveness approach would you prefer?
In this case of a police department, evaluating it will be very different from evaluating a regular business. The first step in evaluating the effectiveness of any entity is to first figure out the nature of the organization and what would be the best indicators of its effectiveness. There are four popular approaches of evaluating effectiveness: goal-based, resource-based, internal process, and strategic constituents. Elements from all of these can be used to analyze a company, but the approaches best suited for the police department would be the internal process and strategic constituents approaches.
The internal process approach is centered on measuring the health and efficiency of an organization to see if it operates smoothly. Some indicators of a good internal process would be trust between employees, clear communication throughout the organization, employee development, and coordination across the organization’s parts (Daft, 2021). All of these qualities are crucial to have a well-run police department. It cannot be filled with lazy, argumentative officers who work independently and do not adhere to organizational structure. To test the effectiveness of the department, there should be investigations into its current communication processes and hierarchy. The officers need to be interviewed and/or surveyed on their opinions towards fellow officers and any ways the department can improve. Cohesiveness training sessions and colleague trust exams can be given as well to instill a culture of teamwork and reliance between the officers. Lives are at stake, and officers need a strong basis from which to work and be effective defenders of the community.
Defense is the main mission of the police, which is why the strategic constituents approach is also a great choice by which to evaluate the police. This approach seeks to find how well an organization is doing to satisfy the needs and desires of stakeholders (Daft, 2021). The main stakeholders of the police are undoubtedly the citizens of their legal jurisdiction, the people they are meant to protect no matter the cost. Police are accountable to the people they defend, who pay them indirectly through public taxes. But despite the fact that citizens may not pay police upfront like they do for businesses, this does not make the citizen-police relationship unimportant. The other main stakeholder or strategic constituent would be the government, which provides the police force and sustains it. The police have to perform well to stay in the graces of the government and keep its reputation high. To measure the strategic constituents approach, one way can be to get the opinions of citizens to see if they believe the police are doing a good enough job protecting, responding to, and behaving ethically to them. For its tie to the government, the police department could be analyzed under an audit-style examination to see if it is upholding the government’s laws on defense and human rights, and also properly prosecuting criminals and executing just punishments on them.
Chapter 3: What types of organizational activities do you believe are most likely to be outsourced? What types are least likely?
Outsourcing is a common feature of many large, modern businesses. It seems, though, that the activities which are outsourced can often be those that are considered mundane or labor-intensive. For example, if a big technology company wants to develop new products and not assemble the products themselves, it can outsource its manufacturing to a different company, usually in a poorer country with lower wage requirements. However, companies can also outsource activities which it believes are too complex or time-consuming for it to perform, such as accounting or human resources. The least likely activities a company will outsource would be those that the company succeeds in. If a company has one or more core competencies, those activities it does very well, then it would not want to outsource them. The company would surely rather take advantage of its competencies and continuously improve them in-house than give them up to another firm that may not fully understand the home company’s skills.
Something companies should consider when deciding what to outsource is the reality of corporate social responsibility (CSR), a company’s efforts to be socially and environmentally conscious in its business dealings. Whether to outsource or not does not depend just on core competencies or corporate disinterests. Outsourcing may be influenced by what a company wants to do for its community or to meet sustainability requirements. In this way, outsourcing can be dependent on the views of stakeholders, rather than what the company believes is best for only itself. Murcia et al. (2021) studied over 2,500 companies and found that those with higher CSR also outsourced less. From this they challenged the prevailing view that outsourcing was simply an economic problem. In fact, businesses may be inclined to do more work in-house because excessive outsourcing can increase supply chain costs and risks that companies do not want to face. By outsourcing less, companies are more capable of monitoring their internal processes, thereby giving them a better opportunity to eliminate waste, promote sustainability, and use its brand as a way to impact social issues that align with corporate values.
How can/should a biblical worldview be applied?
Organizational design is not a settled science that offers singular solutions that will help every company. It is something that is constantly developing with changes in the business world, seeking to find the best ways for companies to organize themselves. Christian businesspeople have to rely not on their own ingenuity or skills, but on God’s wisdom. No amount of brainstorming or training sessions can ultimately lead people to decide what is truly best for a business. Jesus’ teaching of Him as the vine and believers as the branches comes to mind. He said He is the vine and if anyone abides in Him, he bears much fruit, and that we cannot do anything at all apart from Jesus (New American Standard Bible, 1971/1995, John 15:5). No one can even abide in Jesus in the first place unless they are saved, and then the fruits of sanctification start to come. Sometimes quickly, sometimes it takes longer, but they arise when a sinner is saved by God through the gift of repentance and faith. For a company, no one can singlehandedly try to fix it or trust in their own efforts because they will never be good enough. Only through time and wisdom, which come from walking with God, can any Christian in business begin to enact ways to help their company.
References
Daft, R. L. (2021). Organization Theory & Design (13th ed.). Cengage Learning, Inc.
Katić, I., Berber, N., Slavić, A., & Ivanišević, A. (2020). The Relations between Investment in Employees’ Development and Organizational Productivity and Service Quality. Tehnički Vjesnik, 27(4), 1077-1083. https://doi.org/10.17559/TV-20181121101314
Mato-Santiso, V., Rey-García, M. & Sanzo-Pérez, M. J. (2021). Managing multi-stakeholder relationships in nonprofit organizations through multiple channels: A systematic review and research agenda for enhancing stakeholder relationship marketing. Public Relations Review, 47(4), 102074. https://doi.org/10.1016/j.pubrev.2021.102074
Murcia, M. J., Panwar, R., & Tarzijan, J. (2021). Socially Responsible Firms Outsource Less. Business & Society, 60(6), 1507-1545. https://doi.org/10.1177/0007650319898490
New American Standard Bible. (1995). https://nasb.literalword.com/ (Original work published 1971)
