Lectures and notes
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Lecture 1.
Goal interdependence the extent into which the achievement of a goal is hindered or
facilitated by other goals. Think of the example of the CEO which has set goals for every
department apart which led to the problem that everyone is so focused on their own goals
they lose the company’s primary goals out of sight.
Negative goal interdependence: the achievement of goal 1 hinders the realization of goal 2.
Positive goal interdependence: the achievement of goal 1 facilitates the realization of goal 2.
Be careful: positive as well as negative goal interdependence could be in the organization.
Theory of the six blind men and the elephant; it is important from which perspective you’re
looking. To understand organizations, you need to have an integrative view. You have to add
human behavior, division of power, product, environment, teams, management etc. to create
this integrative view.
The challenge with theory: most people contrast practice with theory, however, we saw in
the case that practice suffers from partial views that hinder more complete observation, and
thus better explanations.
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Lecture 2.
Organization theory
Organizations:
- Social entities (=iets wat een bestaan heeft) that;
- Are goal-directed;
- Are designed as deliberately (=bewust) structured and coordinated activity systems,
and;
- Are linked to distinct external environments.
Definitions
“A theory consists of a set of interrelated concepts, definitions and proportions that explain or
predict events or situations by specifying relations among variables.”
“The word ‘theorise’ comes from the Greek ‘theorein’, which consist of a blend of two words
‘thea’, which means see or observe and ‘horan’ which means to see a thing attentively or to
contemplate it.”
A theory;
- Focusses on a small part of reality;
- Abstract of many other relevant aspects;
- Helps us see detail this way;
- Helps us understand that limited part of reality better;
- Is not the whole story, and needs to be seen in a larger theoretical context.
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,Whetten 1989
A theory:
- Consist of a set of concepts (what) and the relationship that tie them together (how)
into an explanation of the phenomenon of interest (why).
- Builds on a set of assumptions that form the foundation for a series of logically
interrelated claims.
In hypothesis, you always need comparison, you always need direction and variation!
The elements of theory (1)
The What has to be clear!
The How has to be clear!
The Why has to be clear!
Good dependent variable: Structures of organizations.
‘How’ is the hypothesis: X and Y related, in what kind of way.
‘What’ is a set of concepts: has two criteria, comprehensiveness (volledigheid) and
parsimony (spaarzaamheid) (all concepts taken into account and redundant factors deleted).
‘Why’ is logical reason why X and Y are related “because” .... just what makes the effect
logical!
Variation: Higher X, Higher Y, assume mechanism works.
Process: Investigate process/mechanism. You look at the arrow, not only at the boxes.
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, About characteristics or about quality of information.
What makes processing so difficult, Information overload, because we are bounded rational
(begrensde rationaliteit = beperkte beschikbaarheid van informatie). Depending on
experience and knowledge, if we get too much, we get lost.
Linear negative: Coleman's Bathtub.
Additive model: every X gives an independent
explanation of Y, non-overlapping.
Hypothesis: Interaction frequency: more
collaborations, more knowledge.
How to read these papers:
What to look for in each theory?
Make sure you:
- Know the dependent (Y) and independent (X) variable(-s);
- Define the concepts (what), specify the relations between the concepts (how), and
give arguments (why) for these relations;
- Are aware of the timeframe (when), place (where), unit of analysis (who) to which
your data apply;
- Can reproduce, understand, and compare theories in terms of levels of analysis,
main assumptions, main concepts, main arguments!
Mayer & Sparrow
Integrating theories in Academy of Management Journal articles
How new theories develop;
Option 1 - Change What = new or adding dependent variable. IV stays the same.
- Same explanatory variables, but a new dependent variable.
- Same dependent variable, but new/additional dependent variable.
Option 2 - Change Why = change the logical story.
- Same dependent and explanatory variable, but different story for why they are
related.
Option 3 - Change How = change the kind of relation, for instance linear to non-linear.
- Same dependent and explanatory variable, but a different relation between them.
Was; positive, now; negative.
Was; linear, now; nonlinear.
Option 4 - Change When = change time period, for instance 1 month to 2 years.
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, - Same dependent variable and explanatory variables, but different time period.
captured with data - say of 1 month, 1 year, 5 years.
For all the papers that you read, look for the way in which the author builds on ‘previous
theory’. Do they change anything? They almost always do.
Look at what they change; Who, What, Where, When, Why, How.
Sutton & Staw, 1995:
What theory is NOT:
- References the why is missing, the explanation is not enough etc.
- Data data are results, data is an evidence of a theory, not the theory itself.
- Lists of variables/concepts the idea of how their related is missing.
- Diagrams it is just a model; it doesn’t tell you anything.
- Only hypotheses not enough either.
The 5 theories offer answers to 5 big organization questions to allow you to generate a
bigger picture:
Q1: How can organizations organize their interaction with the
environment? → InterOrganizational Theory (IOT: TCT + RDT).
Q2: How do organization set goals? → Goal Setting Theory.
Q3: What makes organizations different? → Dynamic Capability Theory
(DCT).
Q4: What causes organizations to become accepted entities? → Legitimacy
Theory (LT).
Q5: When do (departments/teams in) organizations compete, when do
organizations collaborate? → Social Interdependence Theory (SIT),
InterOrganizational Theory (IOT).
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Lecture 3.
Inter-organizational Theory
Part of Organizational Economics
- Interest in organizations/firms: structure, functioning, implications of firms (unlike
many economists in neo-classical traditions).
- Interest in the relationship between competition/environment and organizations
(same as organizational ecology, resource dependence theory and neo-institutional
theory).
- Inter-organizational relationships = the relatively enduring transactions, flows and
linkages that occur among and between an organization and one or more
organization in its environment (Oliver, 1990).
- Reasons why they exist: growth of knowledge, specialization of economic production,
regulation, uncertainty etc. etc.
3 research streams = 3 research questions:
Why do organizations exist? TCT.
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