Concentration and Specialization, Essay Example

Introduction

Organizations are ever-changing systems, and their bureaucracies are evolving continuously. According to DiMaggio & Powell(1983, p. 148), the structure of organization is defined by coalition patterns. However, it is important to note that organizations need to change to respond to internal and external forces’ changes. Carroll (1985) approaches the question of organizational change from the perspective of organizational sociology,  while Kotter (2008) focuses on practical approaches of managing change.  The below review and critique of the three above mentioned articles will attempt to bring together the ideas presented by the authors and attempt to answer the question: what drives organizational change, and what are the main challenges leaders face when

Bureaucracy and Change

DiMaggio & Powell (1983) argue that while bureaucratization and rationalization of organizations, as a process still exists today, the causes of this trend are different. It is, however, important to note that since 1983, globalization has changed the way organizations react to competition and market conditions, therefore, not all the statements presented by DiMaggio & Powell (1983) are relevant today. One of the main statements of the authors is that while many organizations are trying to use innovation to increase their efficiency and reduce costs, the environment of the firm, and the homogenization of technologies and markets does reduce the impact of the change. Reflecting on the above statement, it is important to review some of the most innovative companies’ change strategies. Apple, for example, was unable to diversify itself on markets it created for itself. The iPod was followed by MP3 players, while the Apple i Phone was challenged by Android and Google smart phones. Maintaining the momentum of uniqueness is not easy on today’s globalized market.  One of the ideas presented by the authors related to the above examples is the theory of “normative isomorphism”. According to the authors, this is a process that makes organizations resemble each other on an organizational and structural level. The two types of isomorphism are competitive and institutional, and both prevent individual organizations from diversifying themselves and creating a competitive advantage through change. This constraint, therefore, is one of the main causes of organizations’ lack of ability to create competitive advantage through innovative approaches and diversification.

Organizational Dynamics

Carroll  (1985) reviews organizational and industry changes through the internal organizational structure dynamics focusing on the newspaper industry. The two dynamics of niche width examined by the author are generalism and specialism. Large publishers, according to the author (Carroll, 1985) focus on serving a homogenous, large population, while smaller ones are providing specialized content. The niche width, therefore, is different of various organizations, based on which approach they choose. Based on the above review, the question is: how these organizational approaches impact change and innovation. The author finds that “general interest newspapers in competitive markets commonly differentiate themselves by adopting “high brow” or “low brow” editorial policies, or by devoting larger amounts of space to news for special audiences or special advertisers”. (Carroll, 1985, p. 1268). This trend of differentiation might reduce the number of copies sold, but, on the other hand, might create a loyal, highly motivated customer base, in contrast with large publishers that offer generalized content. Therefore, while generalization of the content and services might help growth, diversification and targeting specific niches would aid innovation within organizations. Further, companies could create a competitive advantage by narrowing their niche, by creating an emotional connection between the brand and their customers. Therefore, one of the main drivers of change was found to be specialization through innovation.

Dealing with Organizational Change

While planning innovation and renewing organizational strategies to serve specific markets better, and more effectively could be a main driver of innovation, it is not without its challenges. According to Kotter & Schlesinger (1979), the main drivers of organizational changes are external conditions of the operating environment, such as regulations, competition, technological advancements, and social environment changes. However, back in 1979, globalization did not impact companies the way it does today. In the 21^st century, the impact of technological and social change is increased by globalization. Many companies are forced to compete with firms across the Globe, and are forced to innovate in order to survive. The main problems identified by Kottler & Schlesinger (1979, p. 2)  are that “they often take longer than expected and desired, they sometimes kill morale, and they often cost a great deal in terms of managerial time or emotional upheaval. Resistance to change was identified as one of the main challenges of today’s managers, and in order to successfully manage and carry out change, leaders need to plan change, based on their preferences and the required speed, as well as available resources.

Conclusion

The above review and critique of three organizational change-related articles has revealed that change and organizational dynamics are challenged and constrained by resistance and the trend of isomorphism. At the same time, specialization using innovative approaches was found to be one of the main drivers of change. It has also been proven that managing change is more important in the globalized world than in the 20^th Century, due to the increased competition and dynamics of the external business environment.

Works Cited

Carroll, Glenn R. “Concentration and specialization: Dynamics of niche width in populations of organizations.” American journal of sociology (1985): 1262-1283.

DiMaggio, Paul J., and Walter W. Powell. “The iron cage revisited-Institutional isomorphism and collective rationality in organizational fields (Reprinted from the American Sociological Association vol 48, pg 147-160, 1983).” advances In Strategic Management, Vol 17, 2000 17 (2000): 143-166.

Kotter, John P., and Leonard A. Schlesinger. Choosing strategies for change. Harvard Business Review, 1979.