Rational Approaches to Organizations - Essay Example

Rational Approaches to Organizations Introduction Some strategies with positive outcomes are generally known by managers but are seldom practiced. One of the reasons why such recommendable tactics are not applied could be that managers believe that they require greater commitment in terms of resources and they take longer to bear the desired results. Nevertheless, rational decision making practices in point of fact cost very little. There are various views regarding rational decision making as applied in organizations. This paper evaluates the reason why most managers find rational approaches to organizations and organizing appealing. It also highlights through examples how taking an open systems or a natural systems approach could benefit managers. Rational Approaches to Organizations Rational approaches present a planned and systematic approach to decision making. Applying such an approach helps managers to maintain order and resoluteness in the decision making process. Dyck (1997) observes that rational approaches generate reason and order through a sequence of steps starting with the discovery of an opportunity or a predicament and culminating with measures to be undertaken in regard to the decisions reached. Mintzberg (1990) argues that rational approaches are based on meticulousness of analysis and assessment of all probable courses of action. This may be appealing to managers considering the fact that future actions are predetermined at the strategy setting stage. Rational approaches to strategy formulation comprise environmental scanning, portfolio and industry analysis, all which are focused on establishing the business opportunities and threats. Environmental scanning helps managers to determine the nature of the operating environment and to set strategies for utilizing emerging opportunities as well as dealing with potential threats (Robbins & Barnwell 2006). Portfolio analysis is among the formal structured examination that encompasses decisions regarding the relative significance of the accessible business opportunities where a company can invest. It allows the management to devise strategies that can supplement the business portfolio in regard to emerging investment openings and products (Ferraro et al. 2005). Industry analysis helps managers to understand the nature of a particular market in which an organization presently sells its products or is planning to penetrate in future. Such rational approaches allow managers to determine the significance of the various strategic business units and prioritize the allocation of resources depending on market attractiveness (Williamson 2000). Strategy development through this process culminates in a well detailed scheme with various courses of action that are meticulous with monetary aspects and resource affiliated data. This process is characteristic of the standard SWOT (Strengths Weaknesses Opportunities and Threats) analysis in strategy development. Mitzenberg (1990) developed a comparable approach to strategy development. His planning approach involves formulating a strategy with a time line, goals and objectives which are stated and formulated to help achieve the organizational objectives. A plan is a critical source of direction for the company since it contains clearly stated objectives. Planning is a continuous process as variables keep changing hence the need for management to be ready for changes through out the organization’s life cycle (Glueck 2009). Mitzenberg’s planning model is limited in the sense that it is suitable for static operating environments otherwise the management needs to continuously review plans in a constantly changing environment. Plans can also not be relied upon in the long run due to technological and infrastructural advancements. The rational approaches integrate an evaluation of the organization and its operating environment with the underlying assumption that changes in the business environment will seldom affect the plan. This enables the management to own the important task of rational appraisal without necessarily involving the employees. It is similar to a bureaucratic management style that has upsides and downsides in the overall organizational productivity (Thompson & McHugh 2002). The advantages of rational approaches that managers find appealing are comparable to the rewards the classical approach to organization and management. The approach comprises of scientific management and bureaucracy. Scientific management, also referred to as tylorism is focused on how to increase efficiency in production, reducing wastage of time and resources and application of empirical techniques in decision making. Division of labor is clearly defined, with the management enhancing the skills of employees through training and development in their areas of specialization. Wages and rewards are pegged to the output and therefore employees work hard to increase their earnings, which translate to improved productivity (Taylor & Hansen 2005). This approach lessens supervision since workers can set their own targets based on the accrued gains. Bureaucracy on the other hand presents a well designed and organized way of accomplishing tasks. In its perfect form, it leads to efficiency in operations since people observe certain working structures thereby maintaining high efficiency with minimal supervision. The structures of work are similar to a predetermined plan that is intended to accomplish the organizational objectives and the ultimate goal. The employees are only required to understand the plan, purpose as well as how the organization operates and undertake the activities contained in it without necessarily having to establish new ways of accomplishing tasks (Glueck 2009). This helps to eliminate confusion and inefficiencies as long as the procedures are clear. Managers may therefore opt to apply the rational approaches that allow employees to work without engaging regularly in discussions regarding the workplace. According to Taylor & Hansen (2005), bureaucracy has the advantage of emphasizing specialization on the job rather than the individual assigned to it, meaning that in the event that such a person leaves the organization, any other person can take up the job hence continuity is accomplished. Nevertheless, even though bureaucracy presents a systematized way of achieving organizational objectives, it is associated with a number of inefficiencies. Some rigid procedures hinder the implementation of positive changes in the organization leaving limited room for improvement. Due to the fact that rules have to be followed strictly, there is a tendency of hindrances in regard to response needed in matters of urgency (Thompson & McHugh 2002). Benefits of Open Systems Approach The open systems approach theorizes an organization as a unit whose inputs originate from the environment; it converts them and liberates them as outputs together with mutual results on the organization along with its operating environment (Scott & Davis 2007). In other words, the organization becomes an integral component of its operating environment. This approach generates interdependence in the sense that the environment contributes the inputs that enhance organizational success while on the other hand the organization contributes to the wellbeing of the environment. For example, Starbucks is a leading multinational in the coffee industry. The organization applies the open systems approach through acquiring inputs from coffee farmers. Equally, farmers depend on the organization for their farm inputs and well being from the income gained from Starbucks. The organization extends its corporate social responsibility through tree planting activities with communities to promote environmental conservation. The company also supports education and community development activities in the regions where its coffee is consumed (Clark, 2007). The open systems approach helps managers to maintain stability in the organization by ensuring control of the environmental factors that exert substantial influence on the organization’s competitiveness, such as workers, consumers, competitors and regulatory bodies. Kaplan & Hurd (2002) observe that organizations need to focus on engaging in partnerships that match their needs. Inter-organizational partnerships are significant in exposing a firm to strategies applied by other players in the market. The potential partners may possess unique competences that are supportive to the organization for it to accomplish its objectives. The rationale behind pursuing inter-organizational partnerships in regard to the external environment is therefore to help a firm to cope with the major drawbacks that can hamper its success (Tepper et al. 2003). Managers are able to evaluate the business environment through the open systems approach while selecting the most relevant aspects that have an impact on decision making in regard to strategy setting and accomplishment of goals. “Task environment” is a term that is used in contemporary organizations referring to the practice of assessing the environmental pressures (Scott & Davis 2007). The task environment looks in to various aspects; evaluation of customers is one of the significant factors that help the management to understand the kind of market segments and the size of market share targeted. It is important to know the customer preferences as well as their purchasing power while setting production and marketing strategies (Prahalad & Ramaswamy, 2004). Understanding the suppliers of inputs is also necessary to maintain internal efficiencies that may have an impact on the organization’s supply chain. Supplier relationships portray a perfect scenario of external environmental factors influencing the organization’s internal efficiency. Competitors on the other hand influence the organization’s performance and hence their strategies need to be understood to ensure that internal processes enhance organizational competitiveness (Scott & Davis 2007). Regulatory bodies may have an impact on organizational performance. Tariffs may raise the cost of operation and the management needs to consider such influences when developing strategies. The management also needs to understand regulations governing the particular industry the organization operates to avoid conflicts with the law. Employees on the other hand determine the organizational productivity. Competence and commitment are among the significant aspects that need to be evaluated to ensure that they match the organizational objectives. Generally, helps to promote positive change in the organization since it is based on the assumption that change is inevitable (Morgan, 2006). Conclusion Rational approaches allow planning for the future thereby maintaining smooth operations in the organization. The approach allows environmental scanning, portfolio and industry analysis that are necessary for strategic planning. It allows strategy development leading to a well detailed plan of action. The organization is evaluated against its operating environment assuming that minimal changes are going to occur in the organizational operations. The classical theory is an example of the rational approaches. It comprises scientific management and bureaucracy. The open systems approach presumes that an organization is a unit whose inputs originate from the environment while the outputs return to the same environment. It helps managers to enhance organizational stability. The approach allows evaluation of the business environment. Suppliers, workers, competitors and regulations are among the environmental factors that are critical to performance. References Clark, T. (2007). Starbucked, Sceptre. Dyck (1997), “Understanding Configuration and Transformation through a Multiple Rationalities Approach”, Journal of Management Studies, Vol. 34 pp 793-823 Ferraro, F. Pfeffer, J. and Sutton, R. I. 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