Discussion
What Is The Impact Of Organisational In Profitability Area?
In measuring the overall impact of the organisational performance in profitability area, it is essential to judge the role of the managers. According to Larson and Foropon (2018), the managers have the direct influence on the organisational performance and the management of the associated employees. They need to maintain the responsibility of aligning the performance of the organisation as well as the employees. Moreover, the managers even play the most significant role in shaping and structuring the overall culture of the organisation. Each of the organisations strategizes their functional movement by depending on the internal and external factors. The formulation of the organisational theories contains causes and assumptions made for developing effective relationships with the internal and external stakeholders (Demirtas & Akdogan, 2015). The organisational theories are thus formulated to make the right approach towards organisational success. The overall essay identifies the key thesis by analyzing the role of the manager in shaping the outcomes of the organisational theories. This study will thus shed lights on the theoretical analysis of the organisational functions and the role of the managers to monitor these functionalities. The evidence based research study will highlight the key areas for suggesting more relevant information related to the subject area.
Every organisation develops their strategic functionalities to remain competitive in a challenging business scenario. It depends on how well the organisation has been performing despite the challenges posed y the market competitors. Organizing the structured functionalities create the standpoint of availing the profitable opportunities in a competitive environment. The formulation of the organisational theories contains causes and assumptions made for developing effective relationships with the internal and external stakeholders. Arthur et al. (2017) defined that the organisational theories and practices are formulated for making others understand about the business environment and overall context. It is noticeable that organisational system has been constantly changing through exchanging information and interacting with the environment. On the contrary, Delacroix (2016) pointed out that the boundaries between the eternal environment and organisational system still exist. The organisational systems sometimes create the sequential orders and predictable approach whereas in some cases, these systems turn out to be unpredictable and disorganized. In fact, it even creates the equal emphasis on the changing scenario and emerging conflicts that affect the stability (Travaglione et al., 2017). Therefore, it is essential to develop the clear understanding regarding the actions undertaken by the organisation. The organisational functionalities are highly influenced by the effective organisational structure.
Resource Dependence Theory
According to Wong (2018), the deterministic theory of organisational structure determines the lesser control over the organisational activities as well as the marketplace. In such cases, businesses are often forced to respond back to the changing scenario and deal with the continuous challenges as well as the changing needs of the consumers (Chen, Du & Tang, 2018). On the other hand, the strategic structure is perceived as the controller of the marketplace and the consumer needs. In this process, business managers strategize their organisational functionalities by promoting through advertisements and changing the pricing structure. It creates the positive impact on customers’ minds. Abbott, Green and Keohane (2016) identified that the managers require concentrating on the clear goals and the appropriate strategic structure to achieve the purpose and changing demands of the consumers. The organisational systems sometimes create the sequential orders and predictable approach whereas in some cases, these systems turn out to be unpredictable and disorganized. The theoretical development of the organisational functions would provide more in-depth knowledge regarding the managerial role inn assessing the organisational theory.
As per the opinion of Kozlenkova, Samaha and Palmatier (2014), managers should have qualities in achieving business success by implementing effective organizational theories. Resource dependency theory implies on how external resources of an organization leaves a major impact on organizational behavior and success. External resources include environmental resources, financial resources and human resources and so on. Customers are considered as one of the most significant external resources of an organization based on whom the success of a business is highly dependent. In order to render organizational achievement as well as positive outcome managers have to be dependent on the customer satisfaction rate. Therefore, implementing product diversity strategy, low cost pricing strategy and effective business strategy is some of the most effective ways of satisfying customers’ needs and demands. As emphasized by Alexander (2014), only skills and competency of a manager is not sufficient enough in controlling the entire process of business.
In order to run an organization successfully, the business manager has to dependent on external resources. Like the same way, financial resource is one of the most significant dependence based on which the manager has to be make effective business plan for enhancing entire organizational wings. Only organizational internal investment is not effective enough for expanding business in the international market. Schuster and Holtbrügge (2014) opined that the organizational managers while planning the business in international market has to be dependent on sponsors based on which they can make effective marketing plan along with proper promotional activities. As stated by Pugliese, Minichilli and Zattoni (2014), resource dependency theory is possessed with several advantages and disadvantages. With the help of this specific theory the managers get the confidence in expanding their entire business process in multinational countries. On the other hand, dependency on external resources does not allow the managers in forming their business strategies and policies in own way. Based on the external resources the managers have to depend in forming business policies. Malatesta and Smith (2014) however opined that Resource dependency is highly significant in maintaining organizational image and goodwill.
Institutional Theory
Caravella (2011) stated that institutional theory signifies in-depth and flexible aspects of the organizational social structure where leaders can establish different regulations, routines, norms and schemes into guidelines. These guidelines are helpful in developing a productive workplace environment that is different from other organization and can provide a company an effective competitive advantage. Alexander (2014) furthermore depict that institutional theory also emphasize on technology and managerial procedure that can leads to uniqueness in business process. Thus, it can be said that organizational structures and strategies are considered by managerial people when institutional theory has been considered by them. Caravella (2011) presented a statement that an organization can only achieve the desired objectives if they follow a well-defined structure. Vargo, Wieland and Akaka (2015) also supported this argument by stating that organizations are confronted with pressures from higher authority in order to compete with other organization. Taken for instance, managers from financial institutions have to follow government tax policies in order to obtain social approval. These pressures are liable for generating for “institutional environment”. However, Alexander (2014) argued that in order to align the organizational structure and objectives, following a defined structure can reduce the productivity. The main reason for the same is that not all employees have same competency and leads to not meeting the institutional expectations.
Thus, the manager has to develop such regulations and organizational structure in which all the employee can be conformable and work with effectiveness to obtain the organizational goals (Vargom, Wieland & Akaka, 2015). Caravella (2011) also presented the statement that organization with formal structure often faced the issue of decoupling situation of actual work practices from the set rules and regulations due to the misalignment of institutionalized expectations and organizational efficiency. Thus, the manager of the organization has to identify the strength and weakness of each individual and develop an environment, where the positive traits of the employee can be utilized for the advancement of the organization and the negative aspects can be improved through training. Miner (2015) also suggested that organizational structure and regulation should be developed in a way so that it cannot define the working procedure of the employee but appreciate the actions taken by the employee to outperform their desired roles and responsibilities. Another aspect that Cummings and Worley (2014) highlighted is that the managers cannot take the decisions solely as they are not free decision makers.
Therefore, it can be said that in order to develop organizational structure and defines company’s regulations, managers can adopt the approach of survey and employee meeting to gather their perception on the organizational environment that can helps in enhancing their potential to perform desired responsibility. Caravella (2011) also portrays that contemporary managers give all the stakeholders proper positions and dignity and position of the partnerships to represent appropriate form of governance structure so that all of them can be satisfied and can collaboratively work to obtain organizational objectives. Thus, in this way a manager work for enhancing the organizational outcome through giving value to all the stakeholders and asks for their perception prior making organizational regulations.
The population ecology is another organisational theory that develops the complete understanding of the internal functions strategized to meet the changing demands of the external market. According to Demirtas and Akdogan (2015), population ecology is also known as the organisational ecology that describes the life of the organisational environment. It measures the effectiveness of the conditions under which the organisation emerge and deal with the probable challenges. Hannan and Freeman clarified that population ecology is an informative study of understanding the dynamic changes within the organisation. The organisational population is utilized here to prepare the analysis. It is noticed that the population ecologists presents a statistical explanation of the birth and mortality of the organisation and the developed population over longer period. Population ecology deals with three major perspectives. First, it explains the birth and death rates within a population in an organisation. Second, it concentrates on the vital-rte interaction between the existing populations. Third, it examines the communities of the population that are sharing the similar environments. Larson and Foropon (2018) observed that population ecology generally defines the evolutionary views of the changing scenario of an organisation.
These strategic theories have the clear impact on the organisational functionalities. Especially, when the organisations need to restructure the functions for responding to the external market demands, these theoretical analysis help the managers to create the clarified vision. The obtained idea from the essay identifies the differences between the strategic theories and deterministic theories. It is notable that the deterministic structure determines that the organisations are forced to adopt the changes within the internal environment to meet the changing demands of the external market (Chen, Du & Tang, 2018). On the other hand, the strategic structure ensures that the organisation embraces the flexibility and changing demands of the eternal environment. The managers need to pay focus on the monitoring these strategic movements for considering the profitable outcome. It is important to recognize the benefits availed from the external market opportunities. Accordingly, the managers structure the functions that can be helpful for maintaining the long term sustainability. Making the appropriate approach to meet the changing demands is necessary and the managers need to perform such responsibilities to ensure the synchronized organisational functions (Travaglione et al., 2017). Moreover, it is essential for the managers to become much prompt to make the quick decisions for the organisation that can deal with the external challenges and meet the requirements of the customers.
Conclusion
The study has provided detailed overview about the role of manager in rendering effective organizational outcome. Numerous eminent scholars have already raised their voice based on this very specific topic. By using their major theories on organizational success such as Resource dependency theory, institutional theory and population ecology theory the study has provided critical overview on how business managers should implement effective organizational strategies for maintaining image and reputation of their brands by following these specific theories. Institutional theory primarily focuses on the managerial procedure and organizational structure to obtain organizational goals.
Therefore, before implementing this specific theory manager needs to have in-depth knowledge and understanding about organizational objectives and goals. In addition resource dependency theory implies on how external resources of an organization leaves a major impact on organizational behavior and success. With the implementation of this theory the study has highlighted on how managers need to know on utilizing external resources properly for rendering success. Finally, population ecology implies on how the internal organizational functions can be implemented strategically to achieve business objectives. Therefore, managers in this situation have to play effective initiative for strategically implementing organizational functions.
References
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