This document includes a detailed summary of the material discussed in this course. It includes lecture notes and book materials.
This course is taught in the first semester of the second year.
Contingency approach in organization theory:
Characteristics of management & organization depend on task environment and related
contingency factors.
Contingency factors
A circumstance or condition that may or may not apply.
Be aware of the danger of “cultural attribution” (we find differences between businesses
in different countries and assume it’s because of culture, while there could be other
factors.)
When looking for the influence of differences in institutional/ cultural environment,
always control for differences in:
- Organization size; age
- Industry; technology
- Etc.
Two strategies for dealing with contingency factors in empirical research: inclusion of
control variables and matching of samples.
Strategy of “matched samples”
, - Select narrow, but comparable subjects in the cultures to be compared
- Draw conclusions from this comparison regarding differences between the
cultures in general
- Assumption: differences between the narrow samples are representative for the
general differences.
Globalization
A qualitative shift towards a global economic system that is no longer based on
autonomous national economies but on a consolidated global marketplace for
production, distribution, and consumption.
Globalization has been slowing down, even reversing since 2017.
Forces promoting/impeding globalization
- Decrease of transportation costs
- Decrease of communication costs
- Integration of international financial markets
- Mass media, social media
- International migration
Limits to globalization: economic
→ Lower company profits outside the home market
At the country level globalization has two effects:
- Wealth creation
- Wealth redistribution
The redistributive effects get larger relative to the wealth creation effects as the level of
trade liberalization increases.
What if the “losers from free trade” need to be compensated.
Limits to globalization: social
→ Unbalanced distribution of benefits
Limits to globalization: cultural
→ Search for cultural authenticity
→ The issue of “cultural appropriation”
Limits to globalization: political
→ The trilemma of globalization, sovereignty and democracy
Scenarios of globalization
, 1. Convergence
2. Specialization
→ Economies will specialize in where they have a comparative
advantage
But a large proportion of trade is intra-industry trade
3. Incremental adaptation
→ Countries tend to evolve in the direction of the most efficient system
and practices
However, cultures and institutions constrain countries&firms in this process
4. Hybridization
→ Parts of the economy/society become part of the global system
Other parts may remain largely unaffected:
- Healthcare
- Education
- Personal services
- Construction
(week 2)
What is culture?
Culture is difficult to define because it encompasses so many elements:
- Ideas and values
- Patterns of behaviour
- Artifacts
- Symbols, etc.
Culture consists of patterns, explicit and implicit, of and for behavior acquired and
transmitted by symbols, constituting the distinctive achievements of human groups,
including their embodiments in artifacts; the essential core of culture consists of
traditional ideas and especially their attached values; culture systems may, on the one
hand, be considered as products of action, on the other as conditioning elements of
further action.
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