Chapter 8: Boundary Setting and Boudary Spanning
Boundary Setting
A collectivity is a "bounded network of social relations governed by
a normative order applicable to the participants linked by the network"
(Scott p. 181). But it is often extremely difficult to define
the boundary of an organization, as it is both diffuse and dynamic.
Even Hannan and Freeman (1989) now admit that the boundary definition of
organizations is itself a variable that changes as technology and other
environmental forces affect it. Determining how to exactly classify a particular
organization is becoming increasingly more difficult.
Boundary definition can be based on criteria that is spatial, temporal,
or the outcome of interaction frequencies. But most organizations define
their boundaries through differentiation of members from non-members via
some criteria of recruitment.
Recruitment policies can have a impact on organizational structure and
behavior.
"The strategic question facing all organizations is how to recruit
participants and harness their roles and resources in the service of
organizational goals (whether goal attainment or survival), while avoiding
or minimizing the danger of becoming captive to participant's external interests
or personal agendas." (Scott p. 186). Organizations can be too loose
and suffer from corruption or nepotism, or be too strict and overly control
the social lives of their workers.
The internal labor market has
become increasingly important to understand social boundaries in organizations.
Internal labor markets and the "corporate ladder" provide stability
of expertise to organizations, though Marxists would contend it's just a
more refined form of labor control. There also continue to be inequities
in labor markets due to gender and race differences. Also, companies are
experimenting with other labor markets to reduce the costs of internal labor
(contracting, temps, etc.).
Managing Task Environments
The task environment is those features relevant to the production system
of the organization (Scott p. 193). Resource dependency theorists and competitive
strategists as well as transaction cost and population ecologists both examine
how organizations build exchanges with their environments to maxmize environmental
control yet ensure survival.
Organizations must define their domain and negotiate with others in their
organization set to gain legitimacy and conduct transactions (Scott p. 193).
Product differentiation and defining the target consumer are key competitive
strategies (Porter 1980). Organizations also must determine the scope of
their activities and degree of vertical integration -- these "make
or buy" decisions determine the technical boundary of the firm (Williamson
1975).
Resource depedency theorists argue that organizations engage in two broad
strategies to manage their task environments. First, they protect their
technical core from environmental disturbances through buffering
strategies and also to flex their boundaries to encompass and control
more or less of the environment through bridging
strategies between organizations, exchange partners, competitors, and
regulators (Scott p. 194).
Managing Institutional Environments
Ideas about institutional environments are more recent and less developed
than with technical environments. But there are key differences between
the two. Most importantly, "whereas organizations exchange elements
with their technical environments, they are constituted by elements drawn
from their institutional environments" (Scott p. 208). Technical elements
are often secured, modified, combined and transformed in organizations,
while institutional elements are secured, utilized, and copied without much
transformation (because it's often important for these institutional elements
to be visible to external constituencies).
Organizations also engage in buffering
strategies and bridging
strategies to address their institutional environment. Often these
make organizations in the same environment structurally similar (isomorphic).
Change in Organizations
Theorists at the organizational set level (resource dependency, contingency,
transaction cost) assume that organizational structures can adapt (Scott
p. 215) through the actions of decision makers. In contrast, population
ecologists argue that most structural change at the population level is
done through selection. Though organizations do adapt their structures,
it is often too slow to successfully react to environmental changes (Hannan
& Freeman, 1984).
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Change in Organizational Fields
Adaptation also occurs at the level of the organizational field through
the collective actions of groups of organizations (some deliberate and some
emergent and unwitting) -- Scott . 219. Local communities or industries
often work together in times of mutual need or crises.