MGMT 445 Week 7 Notes
MGMT 445 Week 7 Notes MGMT 445
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This 3 page Class Notes was uploaded by Patricia Soto on Friday February 26, 2016. The Class Notes belongs to MGMT 445 at University of Illinois at Chicago taught by Eric J. Michel in Winter 2016. Since its upload, it has received 21 views. For similar materials see Organizational Theory in Business, management at University of Illinois at Chicago.
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Date Created: 02/26/16
MGMT 445 Week 7 Notes Interorganizational Relationships Interorganizational relationships- resource transactions, flows, and linkages, that occur among two organizations Organizational ecosystem – a system formed by the interaction of a community of organizations and their environment The Future of Competition 1. Do firms compete anymore? 2. Changing technology and new regulations present organizations with international competition 3. Organizations are involved in complex networks; the number of corporate alliances are increasing 4. Additional competition no longer exists. 5. In ecosystems, managers move beyond traditional responsibilities managers must think about horizontal processes the old role of management relied on operation roles and boundaries Collaborative roles are becoming more important for success. Resource Dependence • Locking in resources through long-term supplier relationships is a common resource-dependence theory • Supply chain management refers to managing the sequence of suppliers and purchasers • Large independent companies can have power over small suppliers • Ex. Walmart and suppliers (fee structure) o Walmart has power and control over suppliers Collaborative Networks • Emerging alternative to resource dependency • Companies join together to become more competitive and to share scarce resources • Alliances require managers who are good at building networks • Companies can share risk and cooperation is a prerequisite for greater innovation, problem solving, and performance • Ex. Delta and Union Square Café Population Ecology • Organizational diversity and adaptation within a population of organizations • Population is a set of organizations engaged in similar activities • The theory notes that large established organizations often become dinosaurs o They have difficulty adapting MGMT 445 Week 7 Notes o The changing environment determines survival or failure o New organizations which better fit the environment take the place of old ones • Heavy investments can limit organizational adaptation • ****Model looks at organizational form – an organization’s specific technology, products, structure, goals, and personnel o Can be selected or rejected by the environment • Organizational niche can help aid in the survival of an organization Population Ecology and the Automobile Industry • From 1886 – 1994, there were 3,845 preproduction organizaing attempts in the U.S. • Between 1900 and 1920, 1600 firms entered the industry o Stanford Automobile and Manufacturing Co. (Palo Alto, CA) o Divine Motor Car Co. (Chicago, IL) o McHardy (Detroit, MI) • Only 11% (about 444) succeeded in transitioning to the production stage • Today, who are the major automotive makers? (3: Ford, GM, etc) Population Ecology Survival Strategies • Organizations struggle for existence (competition) • Generalist strategies – wide niche or domain, broad range of products or services to a broad market o Ex. Ford • Specialist strategies – narrow range of goods or services that serve a narrow market o Ex. Tesla Institutionalism • Institutional perspective: o Manage survival o Balance expectations of environment • Institutional Environment o Norms and values of stakeholders o Adopt structures and processes to please outsiders (i.e. isomorphism) o Legitimacy – an organization’s actions are desirable, proper and appropriate Institutional View and Organizational Design • Technical Structure o Day to Day o Technology MGMT 445 Week 7 Notes o Operating Requirements o Governed by norms and rationality of efficiency • Institutional Structure o Visible to the public o Governed by expectations of the public Three Mechanisms for Institutional Isomorphism • Mimetic Forces o Reason to become similar: uncertainty o Events: Innovation visibility o Social basis: culturally o Ex. Benchmarking to industry best practices • Coercive Forces o Reason to become similar; dependence o Events: political law, rules, sanctions o Social basis: legal • Normative Forces o Social Basis: Moral
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