Who created the Organization Theory

Contemporary Organization Theory

Organization theory is a discipline within the social sciences that analyzes and attempts to explain the dynamics of business organizations, such as the decision-making process, the distribution of power and control, conflict resolution and the promotion of or resistance to organizational change. As Stanford professor Jeffrey Pfeffer summarized in his 1997 book“New Directions for Organization Theory,” organization theory studies provide “an interdisciplinary focus on a) the effect of social organizations on the behavior and attitudes of individuals within them, b) the effects of individual characteristics and action on organization, … c) the performance, success, and survival of organizations, d) the mutual effects of environments, including resource and task, political, and cultural environments on organizations and vice versa, and e) concerns with both the epistemology and methodology that undergird research on each of these topics.”

Organizational Theory

Modern organization theory is based on concepts developed during the late 19th century and early 20th century, in the wake of the Industrial Revolution. Important social theorists like Max Weber, Henri Fayol and Frederick W. Taylor advanced proscriptive theories identifying the various management functions and employee incentives required to run a successful business. During the 1930s, researchers began to adopt a more humanistic approach to organization theory, prompted by several studies that explored the role played by human fulfillment in the success of an organization. These studies indicated that innate forces of human behavior may play a greater role than mechanistic incentive systems on productivity.

Organizational research from that period emphasized the importance of individual and group interaction, humanistic management skills and social relationships in the workplace. One sign of this new focus was the incorporation into organization theory of psychologist Abraham Maslow’s theories regarding the “hierarchy of human needs.” These theories implied that people with different needs will be motivated by different incentives and that these needs change during time as they ascend the hierarchy. It was subsequently recognized that industrial workers would be more productive if more of their personal needs were met (as opposed to previous theories in which monetary reward was considered the sole or primary motivator).

In the 1960s, most theorists and researchers felt that the traditional theories had failed to take into account many environmental influences that impacted organizational efficiency, due to their perception of organizations as closed systems that were isolated from the outside world. This notion was replaced in organization theory by an “open systems” view, which stressed the uniqueness of each organization within its environment and the need to structure the organization to accommodate the unique challenges and opportunities that confront it. One such study addressed the importance of regional cultural influences on worker motivation. Open-systems theory also assumes that all large organizations are comprised of multiple subsystems that interact with and influence each other on different levels. This was a departure from traditional mechanistic theories that assumed a more hierarchical systemic structure.

By the 1980s, several new organizational theories were advanced, including one that sought to integrate American and Japanese management practices, in light of the exceptional productivity of Japanese industry during that period. Modern organization theory is increasingly connected to other organizational sciences and disciplines – such as information theory and coordination theory – and is generally acknowledged to be vital to the success of all kinds of organizations, from small businesses to government agencies.

Some contemporary researchers seek a synthesis of various theories, on the premise that different organizational strategies should be deployed in response to changes in competitive circumstances, structural design and other factors. The 2005 research monograph “Contemporary Organization Theory,” edited by Campbell Jones and Rolland Munro, evaluates the work of 18 key theorists writing during the last two decades and articulates a vision of the possible future of organization theory.

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