Bahçeşehir University Social Science Institutions Ph D. Business Program Management & Organization

1. Bahçeşehir University Social Science Institutions Ph D. Business Program Management & Organization Organizational Theory Prof. Dr. Atilla DİCLE Goals, Power and Control Prep. by: İlhan ÇİFTÇİ 01 January 2010

2. Organizational Goal 5 alternatives uses for organizational goals Cognitive – Rational Approach Cathetic (Motivational) – Natural System Symbolic – Institutional Approach Justification Evaluative Bahçeşehir University - Organizational Theory

3. Individual & Organizational Goals Simon (1964: 1997) has most forcefully urged the distinction btw individual goals that govern a participant’s decision to join or remain in an organization, and organizational goals that are expected to govern decisions of individuals as participants. Bahçeşehir University - Organizational Theory

4. Organizational Goal &The Dominant Coalition Cyert and March Acc. to The Classical Economist’s is to point to the goals of the entrepreneur and to equate the organization’s goals within this person’s objectives. The most satisfactory basis for adressing the question of who sets organizational goals is provided by Cyert and March (1963) Acc. To Cyert and March; organizational goals being set by a negotiation process that occurs among members of the dominant coalition. Bahçeşehir University - Organizational Theory

5. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Participants and Stakeholder Owners and Managers Labor Boundary Roles External Actors Size of Coalition Uses of Power Missues of Power Crime Corruption Modes of Capital Bahçeşehir University - Organizational Theory

6. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Participants and Stakeholder Owners and Managers : Those who own property, whether in the form of capital, land, machinery, or disposable goods, have “ a socially defensible right to make a decision on how to use” these resources. Owners delegate control over resources to managers who are expected to act on their behalf. Labor: Organizations depend on the energies and skills of workers who carry out the work of transforming resources. Bahçeşehir University - Organizational Theory

7. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Participants and Stakeholder Boundary Roles: Enviromental changes lead to change organization unit and power. Environmental change is determined internal structure External Actors: Power over organizations is not restricted to those within its formal boundaries (Mintzberg, 1983) The power of external constituencies to shape organizational objectives has been clear. (Selznick 1983) “Political economy” perspective provides a systematic framework for examining both internal and external sources of power affecting organizations (Zald 1970) Bahçeşehir University - Organizational Theory

8. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Modes of Capital The power of capital resides in Financial Capital: Property, ownership, cash, investments, creditworthiness Human Capital: Personel attributes and skills, education and experince Social Capital: Putnam defines “those features of social organization, such as networks, norms and trust that facilitate coordination and cooperation for mutual benefit” Bahçeşehir University - Organizational Theory

9. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Size of Coalition Acc. Galbraith (1967) one of the most fundamental changes in the organization of the modern corporation has been the shift from an entrepreneurial mode in which a single powerful person dominates the enterprise to a flatter structure in which power is more widely diffused. Thompson (1967) argues that the size of the dominat coalition, is affected both by the nature of organization’s technology and by its task and institutional environments. Bahçeşehir University - Organizational Theory

10. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Uses of Power: What difference, if any, does it make when power shifts from one group to another or is shared with a wider range of individuals and by the organization. Bahçeşehir University - Organizational Theory

11. Organizational Goal &The Dominant Coalition What Factors Affect the Size and Composition of the Dominant Coalition Missues of Power: Crime: A useful distinction differentiates criminal acts organizations into “occupational” and “corporate” crimes. Occupational Crimes are committed by individual employees against their employers for their own gain. Corporate Crimes are committed by individual employees acting on behalf of the corporation itself. Corruption: is by no means limited to developing societies, or societies in transition to a differing mode of governance. Enron, Worldcl etc. Bahçeşehir University - Organizational Theory

12. Anarchies, Adhocracies & Learning All systems provide for the development of a set of goals by which organizational decisions can be made. Rational System Perspective -> Bureaucratic – Administrative Model Natural and Open System Perspective -> Coalitional – Bargaining Model Bahçeşehir University - Organizational Theory

13. Anarchies, Adhocracies & Learning • Decisions and Structures • Thompson and Tuden (1959) focus on decisions and structures by constrcuting typology that combines 2 dimensons: • How much agreement there is among organizational particiapnats about the goals or preferred outcomes of the system, • How much agreement there is about the means or the causal processes by which these outcomes can be realized. Bahçeşehir University - Organizational Theory

14. Anarchies, Adhocracies & Learning Decisions and Structures The cross – classification of ends – and – means distinction produces 4 types of decision contexts, each of which is calls for different decision strategy: Bahçeşehir University - Organizational Theory

15. Anarchies, Adhocracies & Learning Organized Anarchies Acc. to March and his colleagues, decision making under conditions of “inconsistent and ill – defined preferences,” “uncler technologies”, and “fluid participation” lead to change or shift in members decision. These conditions are identified Organized Anarchy. Bahçeşehir University - Organizational Theory

16. Anarchies, Adhocracies & Learning • Garbage Can Model • This Model is not Directly comparable to the earlier • models, bcs the garbage can model deals with the • Pattern or flow of multiple decisions within • Organizations. It ensures that and help us think of the whole organiztion and the frequent decisions begin made by • managers throughout. • The unique characteristic of the garbage can model is • that the decision process is not seen as a sequence of steos that begins with a problem end with a solution. • Indeed, problem identification and problem solution may not be • connected to each other, An idea may be proposed as a solution • when no problem is specified, A Problem may exist and never generate • A solution and so forth. James March and his collegous developed the Organized Anarchy Bahçeşehir University - Organizational Theory

17. Anarchies, Adhocracies & Learning Turbulent Environments A major factor often accounting for the absence of clearly specified goals is the nature of some organizational environments. If environments are turbulent, then it is difficult to establish clear and specific objectives around which to design a structure and orient participant activities. Unstable enviroments undermine clear and consistent goalsi just as they unsettle rigid formalized structures. Bahçeşehir University - Organizational Theory

18. Anarchies, Adhocracies & Learning Conceptions of Goals and Theoretical Models Grandori (1987) argues that there is a close relation between an analyst’s conception of organizational goals and the choice of a theorretical model for explaining organization structure. She takes contingency theory as the base line model, a model assumes that organizations are pursuing single or consistent objectives that are capable of rationally adapting their structure to fit changing circumstances. Bahçeşehir University - Organizational Theory

19. Control Systems Power: Emerson views power as relational, situational, and at least potentially reciprocal. Power in Formal Organization: It is determined at least in part by design: sanctioning powers are attached to positions, avaliable to any individual who occupies one, regardless of his or her personal qualities. Power is not personal but structıral. Power in Informal Organization: It is based on the characteristics of individuals – individual differences that can function as resources allowing some to reward and punish others. Bahçeşehir University - Organizational Theory

20. FORMAL ORGANİZASYON (İŞ TANIMLARI, DEPARTMANLAR AYIRMALAR, ÖRGÜTSEL HİYERAŞİ, PLÂN VE PROGRAMLAR, ÜRETİM VE ETKİNLİK ÖLÇEKLERİ VS…) INFORMAL ORGANİZASYON (GÜÇ VE ETKİLEME, GRUPLAR VE ÖZELLİKLERİ, AÇIKLIK VE GÜVEN KONUSUNDAKİ ALGILAR, ROL ALGILAMALARI, İHTİYAÇLAR, HİSLER, ARZULAR, YÖNETİCİYE DUYULAN GÜVEN, KİŞİLERARASI İLİŞKİLER, VS…)

21. Superordinate Manager Subordinates Colleagues

22. Tannenbaum Graph (1968) Bahçeşehir University - Organizational Theory

23. Authority Acc. Weber (1947): No organization is likely to be content with establishing a power structure; in addition, it will attempt to create am authority structure. Most social scientists define authority as ligitimate power. Acc. to Dornbusch and Scott (1975) mentioned two types of authority : endorsed and authorized Endorsed Power or Authority of endorsement: Social norms that regulate power relations provide the legitimate control structures, Who –what group of participants- defines and enforces these norms. In most informal groups, there is only one possible source: the set of participants who are subject to the exercise of power and hence are subordinates of the power wielder. This subordinate group can limit and regulate the exercise of power over them by a superordinate. Bahçeşehir University - Organizational Theory

24. Authority Authorized power or Authority by authorization: A familiar safeguard built into most hierarchies is teh principle of appeal, by which subordinates who feel that their immediate superior is making unfair or unreasonable demands on them, may turn to their superior’s boss with the expectation that he or she will enforce authority norms that curb the superior’s power. Bahçeşehir University - Organizational Theory

25. Questions and Explanations Bahçeşehir University - Organizational Theory