Organizational System Theory - Coursework Example

Full topic and Section # of ORGANIZATION SYSTEM THEORY Introduction The paper deals to enact the organization environment and its components. It actually shows different factors that together form the internal and external environment of the organization. Later the section deals with importance of action research in the system theory. Organization and its environment An organization is a single entity specially designs to meet the goals and objectives, holding deliberate arrangement of people to accomplish a distinct purpose. Organization deals with the two main environments; the micro-environment and the macro-environment. The micro- environment is the internal environment of the organization that is created by the people of the organization working for a single purpose. The macro-environment is the external environment of the firm that includes different factors such as government and their regulations, competitors, technology, customer demands and many other different factors. This internal and external environment factors greatly affect the overall operations and efficiency of the organization. Open and closed system of environment The open system of environment in the origination is very flexible and allows the information and many other things to pass across the boundary of the organization. The open system environment of the firm is very flexible and can compete easily. This allows the firms to adopt the latest technology and application within the firm. The major drawback of this system is that the external environmental factors directly affect the organization and its activities. Today a modern organization refers to the open system organization that interacts and influenced by their environment. Closed system of environment does not allow the organization and its people to interact with their environment and are not even influenced by the internal and external environment. Analysis of Organizational environment The organization environment basically divides into two main parts, the internal environment and the external environment. The organization has to seek the factors in internal and external environment that affects the firm directly and indirectly. The reason is that it enables the firm to control these factors. According to great economists, the classical and neoclassical theory can better define these factors that are present in the organization environment Classical theory According to Adam Smith the classical theory refers to the first modern thought of economy. Classical theory was developed in 1920. Classical theory work around four main components which are consider to be the major environmental factors in the firm and these are given as: 1. A system-system includes different activities and departments. According to classical theory, the organization includes a system of activities that together work for the organization to achieve a single purpose. This system includes the primary activities and the secondary activities. These all activities actually work for the single purpose for which the organization is developed. 2. People-according to classical theory, the people within the organization hold different roles in order to manage and maintain above mention activities. These peoples are the human capital of the originations that systemize all the activities to achieve the goals. 3. Cooperation- the cooperation of these people with each other is the third main component. This cooperation actually helps the organization to take all the activities together to achieve, for what the firm is developed for. 4. Authority- the fourth component is the authority. This authority is the major component that is needed to ensure the cooperation. The authority actually helps to monitor not only the people but also the cooperation within them. Basic Assumptions of classical theory According to classical theory effectiveness should be measured by the productivity level of the firm not by the worker attitudes. Whatever will be the workers attitudes, the productivity level of the firm actually measures the efficiency and effectiveness of the firm. If the worker do not like to work than it means they need a supervision that keep them working. This supervision means that they want an authority that keep on managing them and try to solve their problems. According to classical theory, the limitation of each worker must be shown; workers must be assigned by their job and can not use their own discretion. The last thought of the classical theory is that the workers should be taken objectively as they only work for money. Neoclassical theory The neoclassical theory of the firm totally differs from the classical theory. According to this theory their must be informal structure within the firm that develops norms, beliefs and attitudes within the organization culture. According to this theory structural consideration is not the prime factor rather the need fulfillment is the prime factor. If the firm is able to satisfy the needs of their internal and external employee’s than the firm is consider to be very efficient and effective. Basic assumptions of neoclassical theory According to this theory the work is the social and physical activity. Their must be informal social networks within the firm that includes 1. Norms and codes of behavior 2. Attitude 3. Well-define status 4. Fulfill the needs for recognition and this fulfillment of needs is more important to seek the actual productivity of the firm rather the structural development. Analysis of the role of action research Action research Action research is the progressive problem solving process in an organization. It actually involves the collection of data and then analyzed the data to seek the change or problem that took place. Process of theory development evolved from action research Different economists shows different process of theories evolved form the action research. But the action research process actually involves simply five steps in theory development and these are given as follows 1. Diagnosis: the firm has to diagnose that where actually the problem is. They have to diagnose the problem within their departments. The change agent seeks the problem through different techniques either by interviewing the employees or seeking their reviews. 2. Analysis: the analysis is followed by the diagnosis process. In analysis section the firm has to analyze the root cause of the problem. The analysis process involves the involvement of employees that actually helps the change agent to seek the problem or changes in the departments 3. Feedback: the feedback process includes information taken from the employees about above two processes. The feed back actually informs the views and reporting of the employee’s that shows that which system or activity is causing problem. 4. Action: the step of action involves various different steps taken by change agent to solve the problems. This requires different steps and techniques chose by the agent according to the problem. This step actually corrects problems where they are identified. 5. Evaluation: the process of evaluation actually shows the result of different steps that are taken by the firm. It shows the effectiveness of the action plan. Access the value of action research process The action research process provides two main benefits to the firm. First of all, its problem focused. The change agent or the manager seeks the problems that are taking place within the firm. Though, most of the activities are solution centered but there are some activities and process that needs a detail inspection to know the actual root cause of the problem. These activities require different steps for problem solution. The other major benefit of the action research is that resistant to change is reduced as different employees are involved directly and indirectly to seek and solve the problem. As different steps in the action research involves employees that help to seek the problem and to solve it. In fact the step of feedback in action research keeps the employees to keep them self away from any change and help to maintain and manage the activities. Reference/bibliography Fred Luthans (2001) “Organizational Behavior” edition 9th N. Gregory Mankiw (1998) “Principles of Microeconomics” 1st Edition Robert S. Pindyck, Daniel L. Rubinfeld (2004) “Microeconomics” 1st Edition Richard G. Lipsey, Alec Chrystal (2003) “Economics” 10th Edition Stephen P. Robbins (2001) “Organizational Behavior” edition 9th Peter Ferdinand Drucker (2007) “Management” 1st edition Philips Kotler (2003) “Marketing Management” Eleventh edition Read More