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Population Ecology Case Study: Peter Browning & Continental White Cap
Population Ecology
Case Study: Peter Browning & Continental White Cap
ORIGIN
major school of org theory, whose p
remise is that orgs experience inertia (cannot change) and explores the relationships b/w organizational form (e.g. specialist vs generalist) and the env't
developed during this time when US corps seemed unable to respond to Japanese competition
uses insights from biology to understand the conditions under which orgs emerge, grow and die
theory applies to populations that are highly competitive and not all populations conform to this req't
(*HANNAN & FREEMAN, 1977)
present pop. ecology as an alternative to adaptation perspective
POPULATION ECOLOGY:
study of dynamic changes w/in a given set of orgs (aka population) - examine birth and mortality of orgs and org forms w/in population over long periods
natural selection = env't selects for fit
HYPOTHESES
long-term change in the diversity of org forms is due to selection, RATHER than adaptation
most orgs have structural inertia that hinders adaptation when the env't changes
orgs that become incompatible w/ env't are replaced through competition
.: selection framework is needed (derived from human ecology) to
supplement adaptation perspective
INERTIA
: tendency to do nothing or remain unchanged
arises from internal and external factors/pressures
internal pressures
:
investments
in machines and assets,
limited information
(i.e. leaders don't obtain full info on activities w/in the org and env't facing subunit), internal
politics
(structural change almost always involves redistribution = ppl upset), and
normative agreement
(norms provide justification to resist and preclude serious consideration of alternative responses
external pressures
:
legal and fiscal barriers
(to enter/exit from markets), cost of acquiring info,
external legitimacy
(if org change violates legitimacy claims) and
coordination w/ others
(adaptive solution that works for one org, won't necessarily work for others)
CHANGE
frequency of changes = grain
high frequency --> fine grain (e.g. fashion)
low frequency --> coarse grain (e.g. legal systems)
excess capacity can accommodate fine grain
5 LEVELS OF ANALYSIS
: members, subunits, individual orgs, populations of orgs, communities of orgs
ORG FORM / BLUEPRINT
: adaptive capacity of species
2 forms
activity function
- rules used in acting on received info
information function
- rules used in obtaining, processing and transmitting info
fitness
: probability a given form of orgs would persist in a certain env't
orgs dev. capacity to adapt at the cost of lowered perf in stable env'ts; survival depends on the nature of the env't and competitive situation
ADAPTATION PERSPECTIVE
orgs can adopt strategies to adapt org structures to env'tal demands (e.g. contingency theory, resource dependence theories, Marxist theories)
scan relevant env't for opps and threats to formulate strategic responses and adjust org structure
adaptation = companies adapt
CRITIQUES
extreme view that orgs are unable to change
either with flourish in good env't or die out in poor env't
overly cynical and critical of top mgt
e.g. ppl put out milk --> cats population flourish; dogs die out - they don't become cats
makes mgrs out to be unnecessary b/c adapting/change is not possible
THEORIES
COMPETITION THEORY
2 ecological considerations:
capacity of the env't to support forms or orgs
rate at which populations grow/decline
orgs cannot grow indefinitely and still maintain its original form
dissolution of small orgs and their replacement of large orgs (death and birth)
selection emphasizes competition
org forms fail to flourish in certain env't b/c other forms successfully
compete for essential resources
the
greater the similarity of 2 resource-limited competitors, the less feasible a single env't can support both in equilibrium
--> less fit org with tend to be eliminated
orgs will compete most intensely with like orgs (e.g. local bank, mid-size, global
NICHE THEORY
Expect to find:
specialized orgs are favored in stable and certain env'ts
generalist orgs are favored in unstable, uncertain conditions
orgs become more flexible by employing professionals b/c it increases their capacity to deal with variable env't and contingencies it produces
populations of org forms will be selected for or against depending upon the amount of excess capacity they maintain and how they allocate it
specialism
: population of org flourishes b/c it maximizes its exploitation of the env't and accepts the risk of having that env't change
generalism
: accepts lower level of exploitation in return for greater security
if changes are too rapid, generalists can be seriously damaged
given uncertainty, most orgs maintain excess capacity to insure reliability of perf
Frequency of change
:
high frequency --> fine grain (e.g. fashion)
low frequency --> coarse grain (e.g. legal system)
excess capacity can accommodate fine-grain
CASE STUDY: PETER BROWNING
source of problem: introduction for plastic caps = price competition
tradition is dulling business strat; complacency; high admin costs
Continental maintains good customer relations
family-oriented
Browning needs to
fix White Cap but not break it
Actions:
built rapport - had conversation over dinner about changes he wanted to implement with White (founder)
reassured supervisor that he will always inform him and let him know; let him retire with dignity
reassigned a problematic mgr so he had no EEs
provided feedback to EEs
TAKEAWAYs
illustrates the advantage of preserving culture
successful change requires ppl on board
shows the advantages of reading the informal orgs and exercising authority
case highlights inertia (e.g. preserving org culture/identity, existence of norms and processes, need to work w/ existing informal networks, key figures from old regime delegitimize new)