Exam theory: Organisational theory
(Lecture 1)
What is an organization?
Any group of people who work together to reach a shared goal (people, cooperation,
common purpose)
What is the macro environment?
Demographic
Economic
Sociocultural
Technological
Ecological
Political
What is the meso environment / how do you analyse it?
It’s the analysis of the industry, includes Porters five forces.
Meso environment includes: media, buyers, suppliers, competitors, employees, investors,
etc.
What are Porters five forces?
- Threat of new entrants
- Competition
- Bargaining power of suppliers
- Threat of substitutes
- Bargaining power of buyers
What is harmonization?
It is taking into account the influence of the surroundings (external environment).
How do you analyse the external environment?
DESTEP analysis
- Demographic: Size, growth and composition of the population.
- Environmental: how does the business affect the environment? Environmental care needs
to be shown (understanding and reducing negative influences on the environment through
business activities)
- Societal
- Technological
,- Economical: Economic growth in other countries, exchange rates, labour costs and wages
in foreign countries
- Political: Government authorities use their political power to steer their economy in a
favourable direction. This can include price levels, the distribution of income, the job
market, etc.
What are the five forms of economic integration? (POLITICAL)
1) A free trade zone – Mutual trade agreements between countries that wish to participate,
free trade. Countries can decide on their own tariffs for products that are imported from
countries outside of the free trade zone.
2) A customs union – A common trade policy is adopted. Members then decide on a
common external fee for countries outside of the trade zone..
3) A common market – This is based on a customs union and the four economic freedoms
are in place.
4) Economic union – This step includes all of above, plus the harmonization of economic
and monetary activities. This requires political and financial co-operation and a central
bank must be set up in order to manage the currency and interest rates across the union.
5) Complete political and economic union – This is the situation where independent states
or countries merge completely. E.g. the formation of the USA.
What are the four economic freedoms of the European Union?
1) Freedom of movement of goods
2) Freedom of movement of services
3) Freedom of movement of capital
4) Freedom of movement of people
What is CSR?
Corporate social responsibility – the idea that a company is part of a larger system.
Companies must act responsibly and take into account human, environmental and other
external factors.
What is the triple bottom line?
This is when companies take into account three dimensions:
1) People – how does the organisation act towards its own staff and the local community?
(human rights, gender relations, diversity and discrimination)
2) Planet – how does the business interact with the natural environment? Does it minimize
damage?
3) Profit – the overall economic value the business generates, e.g. fulltime employment,
investment in infrastructure, sponsorship
,What are principles?
They relate to the norms and values of the organisation. The following could be aspects of
an organisation’s principles: Quality first, Customer first, Reliability and honesty, we
contribute to society.
What are organizational goals?
They are defined based on the organisations vision. These goals show the relationship
between the organisation, the environment and the employees. Naturally, the content is
influenced by stakeholders, particularly the providers of finance (e.g. shareholders)
What subjects can organizational goals refer to?
1) Balance of interests – ‘’We are reliable to our customers, shareholders, staff and
suppliers’’
2) Profitability – ‘’We aim to make our products and services profitable for our customers
and for ourselves’’
3) Quality – ‘’We always produce perfect products and are there when our customers need
us’’
4) Efficiency and effectivity – ‘’We encourage our staff to contribute to the setting of targets
and the planning of how they can best be achieved’’
5) Image – ‘’We are a leading supplier of products and services’’
6) Code of conduct – ‘’We work in a disciplined manner and keep our word’’
What are the three dimensions of the environmental challenge for organisations?
(ENVIRONMENTAL)
1) The cleaning up of present activities – Organisations must discover and monitor the
effects their activities have on the environment
2) The utilizing of new opportunities – Working on new versions of processes/products that
are more environmentally friendly
3) Working for a sustainable future – Developing a vision that utilizes the new opportunities
What influence will developments in IT have on all organisations in the upcoming
years?
1) Fundamental changes in the way work is done
2) Integration of functions
3) Economies of scale and changes in decision-making
, What are special interest groups? (A stakeholder)
They are a group of stakeholders that focus on the interests of a particular group of
people, for example, trade unions fighting for better working conditions, wages, etc.
What is the micro environment?
7S’s: Hard factors // Soft factors
Structure – Defines tasks, competencies, and responsibility and sets out the pattern of
relationships between positions.
Systems – Information and communication systems, formal and informal, within the
organization
Strategy - A plan that states what an organisation needs to do to reach its goals.
Key skills – Capabilities of individuals in an organization AND the organization that make it
stand out and help differentiate from competition.
Staff – The way an organization pays attention to its human resources
Managerial style - The characteristic behavioural patterns of top managers of the
enterprise – this affects the culture of the organization.
Shared values - This is the vision
What is the difference between hard factors and soft factors?
Hard factors are tangible and can be described. Soft factors show the human side of the
organization
Go into detail about each aspect of the 7S’s:
1. STRUCTURE (Hard)
What is organizational structure?
It defines tasks, competencies, and responsibility and sets out the pattern of relationships
between positions.
What is task division?
(Lecture 1)
What is an organization?
Any group of people who work together to reach a shared goal (people, cooperation,
common purpose)
What is the macro environment?
Demographic
Economic
Sociocultural
Technological
Ecological
Political
What is the meso environment / how do you analyse it?
It’s the analysis of the industry, includes Porters five forces.
Meso environment includes: media, buyers, suppliers, competitors, employees, investors,
etc.
What are Porters five forces?
- Threat of new entrants
- Competition
- Bargaining power of suppliers
- Threat of substitutes
- Bargaining power of buyers
What is harmonization?
It is taking into account the influence of the surroundings (external environment).
How do you analyse the external environment?
DESTEP analysis
- Demographic: Size, growth and composition of the population.
- Environmental: how does the business affect the environment? Environmental care needs
to be shown (understanding and reducing negative influences on the environment through
business activities)
- Societal
- Technological
,- Economical: Economic growth in other countries, exchange rates, labour costs and wages
in foreign countries
- Political: Government authorities use their political power to steer their economy in a
favourable direction. This can include price levels, the distribution of income, the job
market, etc.
What are the five forms of economic integration? (POLITICAL)
1) A free trade zone – Mutual trade agreements between countries that wish to participate,
free trade. Countries can decide on their own tariffs for products that are imported from
countries outside of the free trade zone.
2) A customs union – A common trade policy is adopted. Members then decide on a
common external fee for countries outside of the trade zone..
3) A common market – This is based on a customs union and the four economic freedoms
are in place.
4) Economic union – This step includes all of above, plus the harmonization of economic
and monetary activities. This requires political and financial co-operation and a central
bank must be set up in order to manage the currency and interest rates across the union.
5) Complete political and economic union – This is the situation where independent states
or countries merge completely. E.g. the formation of the USA.
What are the four economic freedoms of the European Union?
1) Freedom of movement of goods
2) Freedom of movement of services
3) Freedom of movement of capital
4) Freedom of movement of people
What is CSR?
Corporate social responsibility – the idea that a company is part of a larger system.
Companies must act responsibly and take into account human, environmental and other
external factors.
What is the triple bottom line?
This is when companies take into account three dimensions:
1) People – how does the organisation act towards its own staff and the local community?
(human rights, gender relations, diversity and discrimination)
2) Planet – how does the business interact with the natural environment? Does it minimize
damage?
3) Profit – the overall economic value the business generates, e.g. fulltime employment,
investment in infrastructure, sponsorship
,What are principles?
They relate to the norms and values of the organisation. The following could be aspects of
an organisation’s principles: Quality first, Customer first, Reliability and honesty, we
contribute to society.
What are organizational goals?
They are defined based on the organisations vision. These goals show the relationship
between the organisation, the environment and the employees. Naturally, the content is
influenced by stakeholders, particularly the providers of finance (e.g. shareholders)
What subjects can organizational goals refer to?
1) Balance of interests – ‘’We are reliable to our customers, shareholders, staff and
suppliers’’
2) Profitability – ‘’We aim to make our products and services profitable for our customers
and for ourselves’’
3) Quality – ‘’We always produce perfect products and are there when our customers need
us’’
4) Efficiency and effectivity – ‘’We encourage our staff to contribute to the setting of targets
and the planning of how they can best be achieved’’
5) Image – ‘’We are a leading supplier of products and services’’
6) Code of conduct – ‘’We work in a disciplined manner and keep our word’’
What are the three dimensions of the environmental challenge for organisations?
(ENVIRONMENTAL)
1) The cleaning up of present activities – Organisations must discover and monitor the
effects their activities have on the environment
2) The utilizing of new opportunities – Working on new versions of processes/products that
are more environmentally friendly
3) Working for a sustainable future – Developing a vision that utilizes the new opportunities
What influence will developments in IT have on all organisations in the upcoming
years?
1) Fundamental changes in the way work is done
2) Integration of functions
3) Economies of scale and changes in decision-making
, What are special interest groups? (A stakeholder)
They are a group of stakeholders that focus on the interests of a particular group of
people, for example, trade unions fighting for better working conditions, wages, etc.
What is the micro environment?
7S’s: Hard factors // Soft factors
Structure – Defines tasks, competencies, and responsibility and sets out the pattern of
relationships between positions.
Systems – Information and communication systems, formal and informal, within the
organization
Strategy - A plan that states what an organisation needs to do to reach its goals.
Key skills – Capabilities of individuals in an organization AND the organization that make it
stand out and help differentiate from competition.
Staff – The way an organization pays attention to its human resources
Managerial style - The characteristic behavioural patterns of top managers of the
enterprise – this affects the culture of the organization.
Shared values - This is the vision
What is the difference between hard factors and soft factors?
Hard factors are tangible and can be described. Soft factors show the human side of the
organization
Go into detail about each aspect of the 7S’s:
1. STRUCTURE (Hard)
What is organizational structure?
It defines tasks, competencies, and responsibility and sets out the pattern of relationships
between positions.
What is task division?
