Theories Used In The Organization
Theories Used In The Organization
There are various theories that can be used to solve problems in the organization like resource dependency theory. The theory examines how the, organizational external, resources impact the organizational behavior. Procuring external resource is crucial for strategic management and tactical management. The resource dependence theory assumes that firms depend on resources. The resources companies rely on come from their environment. The environment has other firms. Hence, the resources organizations require are in found, in other organizations., Resources are a source of power. Independent firms can rely on each other. The dependence on power and resources are directly connected. Thus, company A’s power over company B is company B reliance on company A resources. Organizations depend on various resources. That is labor, raw material, customers and capital. Managers in companies understand that the company success is related to customer demand. The resource dependence is used to solve dilemmas related to resource acquisition and dependence on other organizations. Organizations have to depend on other firms to succeed and survive. For instance, it can be used to solve labor issues in an organization. Labor is essential for the production of goods and services to meet customer demands. Organization as should have sufficient, skilled and experienced labor to compete globally and satisfy consumer demands (Willmott, Daft & Daft, 2010).
Additionally, structural contingency theory can help solve problems in the organization. Companies should be able to adapt to their environment in order to survive according to structural contingency theory. The management should develop appropriate strategies in order to enable the organization to adapt to the environment. There are various contingencies including technology, diversification etc. contingency and organizational structures are related. Therefore, managers should determine the contingency and the best structure to enable the firm adapt to the environment. Organizational change or contingency change causes a change in organizational structures. Organizations should fit their structures to the contingency to improve organizational performance. Therefore, organizations change their structures to respond to contingency. The structural contingency theory helps solve problems related to structural change, technology change and any other kind of change needed to adapt the organization to the environment (Donaldson, 2001).
Lastly, systems theory can be used to solve global dilemmas. A system is an entity that is considered whole and has a boundary around it. The boundary differentiates the internal elements and external elements. It also identifies inputs and output related to the entity. System theory examines phenomena as a whole, but not sum of its parts. It examines the interaction and relationship between various parts so as to understand the organization, functioning and outcome of the entity. The systems theory helps in solving, global organizational, problems such as the environment, value and quality. The organization is considered a system and the environment the system at the micro level and macro level respectively. Managers examine the structures of the organization and structures of the supra system and takes the necessary actions for survival and adaptation to the environment. Organizations should preserve their viability and stability by developing an internal environment that responds effectively to stimuli from outside. Managers understand the relationship between the system and subsystems in order to solve problems. Organization should not treat each subsystem as a unit as they all work and interact together. Thus, they should focus on understanding the entire system to solve problems and operate effectively globally (Pels, Mele & Polese, 2010).
Reference
Donaldson, L. (2001). The Contingency Theory of Organizations. Sage
Pels, J., Mele, C., & Polese, F. (2010). A brief review of system theories and their managerial applications. Service science.2 (1/2):126-135
Willmott, M.H., Daft, R.L., Daft, R.L. (2010). Organization: Theory and Design. Cengage Learning EMEA
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