Organization & Strategy Essay

1198 words - 5 pages

Foundations of Organization
Lecture 12: Organizations as bundles of resources, competences and routines
Markus Becker & Nils Stieglitz

STRATEGIC ORGANIZATION DESIGN

Program today
• • • • • • • Recap The firm as a bundle of resources Resources: Routines, skills, and competences Organizational routines defined Contribution of routines to understanding organizations Roles of routines in organizations Take Away Points

STRATEGIC ORGANIZATION DESIGN

Re-cap behavioral theory
• Very influential theory of organizations • Focus on decision-making • Actors are seen as bounded rational and both actors and organizations have ways of coping with such limitations • ...view middle of the document...

.. (Penrose, 1959)
STRATEGIC ORGANIZATION DESIGN

Resources: Routines and competences
Most interesting resources: those that provide sources of sustained competitive advantage • • • Resource heterogeneity Ex ante limits to competition Ex post limits to competition imperfect substitutability imperfect imitability Imperfect mobility

•

STRATEGIC ORGANIZATION DESIGN

Organizational routines
• The term organizational routine refers to the fact that tasks in organizations are accomplished in stable ways, in repetitive, recognizable patterns of interdependent actions involving multiple actors

STRATEGIC ORGANIZATION DESIGN

Stable behavior patterns and their sources
Stable behavior patterns • Recurrent interaction patterns Sources of stable behavio patterns: Rules • Standard operating procedures etc. Dispositions • to engage in previously adopted or acquired behavior, triggered by an appropriate stimulus or context A set of coordinated behavioral dispositions developed in response to a particular organizational environment.
STRATEGIC ORGANIZATION DESIGN

Skills and Routines
certain Skills are abilities that an individual possesses to perform certain activities Such as read, swim, bike, rollerblade Properties of skills • Programmatic • involve a sequence of steps with each successive step triggered by and following closely on the completion of the preceding one Tacit Knowledge • Knowledge that is difficult or impossible to articulate a full account of the details – how do you swim? Selected automatically without awareness • making of numerous ‘choices’ BUT a choice is being made without conscious calculation
STRATEGIC ORGANIZATION DESIGN

Organizational routines are the organization level analogue to individual-level skills
Individual : Skills = Organization: Routines • Note: An analogy made by metaphor • Implies: As individuals use skills, organizations use routines • I.e., programmatic, tacit and selected without awareness • Routines are properties of organizations • Individuals play minor roles in any single routine • What is the implication for turnover? • As individuals learn skills, organizations can learn new routines • As individuals find it hard to change their skills (habits) once acquired, organizations find it hard to change routines, once set in place

STRATEGIC ORGANIZATION DESIGN

Organizational routines provide a perspectives for describing organizational behaviour and change The concept of organizational routines • provides a perspective on organizations … • that focuses on stability … • in how organizational tasks are accomplished … • jointly by several actors • provides the most micro collective-level building blocks of behavior that are meaningful in the context of strategy and organization theory

STRATEGIC ORGANIZATION DESIGN

To understand routines is to understand organizations
Routines are ubiquitous in organizations, and an...

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