This article focuses on organizational environment. The success and effectiveness of an organization is dependent upon the interaction of the organizational system with its environment. Sociologists study the points and processes through which organizations and their environments interact. This article discusses the sociology of organizational environments in four parts: An overview of different types of organizational environments; a description of the field of organizational studies and theories of organizational environments; an exploration of the factors that determine the effectiveness of organizational environments; and a discussion of the issues associated with studying the organizational environments of transnational organizations. Understanding the ways in which organizations and their environments affect one other is vital background for all those interested in the sociology of social interaction within groups and organizations.
Keywords Adaptability; Closed Systems; Open Systems; Organizations; Organizational Environment; Organizational Sociology; Social Systems
Social Interaction in Groups
The success and effectiveness of an organization is dependent upon the interaction of the system with its environment. The processes through which organizations and their environments interact are subjects of study for sociologists. Factors such as organizational decision making, characteristics and structures are all affected by the environment. Understanding the ways in which organizations and their environments affect one other is vital background for all those interested in the sociology of social interaction in groups and organizations. This article explores the sociology of organizational environments in four parts: An overview of different types of organizational environments; a description of the field of organizational studies and theories of organizational environments; an exploration of the factors that determine the effectiveness of organizational environments; and a discussion of issues associated with studying the organizational environments of transnational organizations.
Types of Organizational Environments
Social scientists debate the meaning and parameters of organizational environments. The dominant models of organizational environments include Paul Lawrence and Jay Lorsch's stable or uncertain organizational environments, Frederick Emery and Eric Trist's four organizational types (i.e. the placid, randomized environment; the placid, clustered environment; the disturbed, reactive environment; and the turbulent field environment), and Robert Duncan's simple-complex and static-dynamic models of organizational environment (Rosenzweig & Singh, 1991).
Stable of Uncertain Environments
In 1967, Paul Lawrence and Jay Lorsch divided organizational environments into two types: Stable or uncertain. Stable organizational environments are predictable. Under stable circumstances, organizations tend to be more efficient and successful when they incorporate hierarchical structures of management, reporting, and accountability. Uncertain organizational environments are characterized by constant change and unpredictability due to new technologies or growth. Under unstable circumstances, organizations tend to be more efficient and successful when they adopt a decentralized leadership and management structure. Organizations with uncertain environments often require the use of specialized skill sets and communication strategies to handle new and unexpected situations.
According to Lawrence and Lorsch, the majority of organizational environments are uncertain and characterized by rapid change. Lawrence and Lorsch based their theories of organizational environments on their study of a wide range of organizations across industries and business sectors. Lawrence and Lorsch's extensive research lead them to develop the contingency theory of organizational environments and management. The Lawrence-Lorsch theory of organizational contingency explains that, ultimately, uncertainty and rapid change dictate how the organization should be managed (Lawrence & Lorsch, 1967).
The Emery-Trist Levels of Organizational Environments
In 1965, Frederick Emery and Eric Trist developed four models of organizational environments. The Emery-Trist levels of organizational environments include four main organizational types: The placid, randomized environment; the placid, clustered environment; the disturbed, reactive environment; and the turbulent field environment.
- The placid, randomized environment refers to the most simple form of organizational environment in which resources, goals, and values are distributed randomly and remain unchanging. Inputs, such as resources, goals, and values, are distributed at a constant pace or frequency. The organizational environment survives without much knowledge or direction on the part of its members. Adaptability and copability are low in the placid, randomized environment.
- The placid, clustered environment refers to the semi-complex form of organizational environment in which resources, goals, and values are unchanging and located in clusters. Examples of clusters include segmented markets, vendors, and products. In a placid, clustered environment, the organization's survival is linked to its ability to connect the right specialized knowledge, processes, and technologies with their corresponding cluster. Placid, clustered environments need to develop multiple specialized competencies for each cluster.
- The disturbed, reactive environment refers to scenarios in which multiple social systems dominate the same environments. In disturbed, reactive environments, the social systems are dependent on one another. The survival of systems in disturbed, reactive environments depends on the system's knowledge of other system's reactive behavior as well as their resources, values, and goals.
- The turbulent field environment refers to chaotic scenarios in which there are no clear cause and effect relationships between the organizational system and its environment. There are constant external fluctuations and uncertainties. An organization's survival in a turbulent field environment is dependent upon the organization's knowledge of the changing environment and its ability to endure sustained emotional stress. Surviving turbulent field environments requires high amounts of adaptability and copability.
The Emery-Trist levels of organizational environments, described above, have different levels of adaptability and copability. Organizational environments vary in their decision-making, information processing, tolerance for frustration, competence, and needs. Ultimately, organizational managers and leaders need to have extensive knowledge of the internal characteristics of the system and the external environment (Motamedi, 1977).
In 1972, Robert Duncan developed the simple-complex and static-dynamic models of organizational environment. Duncan's model is used by organizations to understand how best to respond to and cope with uncertainty. Duncan argues that different types of environments produce different types of uncertainty. He studied 22 decision-making groups in three manufacturing and three research and development organizations to identify the characteristics of the environment that contribute to uncertainty in the decision making process. To do so, Duncan recognized and defined an organization's decision-making unit as a formal work group within an organization with responsibilities that further organizational goals. These decision units are characterized and classified as simple, complex, static, or dynamic. The simple-complex organizational environment refers to the number of factors that affect the decision making process. The static-dynamic organizational environment refers to the degree to which the decision-making factors or variables remain constant or in a state of change. Individuals in dynamic-complex environments experience the greatest degree of uncertainty and change.
In addition to the decision-making characteristics of organizational environments, Duncan distinguishes between the characteristics of external and internal organizational environments. Internal organizational environments include organizational personnel, organizational functional and staff units, and organizational level. The organizational personnel component includes educational background and skills, technical and managerial skills, interpersonal styles, and availability of workers within the system. The organizational functional and staff component includes technical abilities of units, interdependence of organizational units, and intra-unit and inter-unit organizational conflict. The organizational level component includes organizational goals and organization's product or service. External organizational environments include customers, suppliers, competitors, socio-political variables, and technology. The customer...
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