6 pages 48 hours (A0109)

Information and

Organisational Design

Evolutionary Approaches to

Organisations

Introduction

 Focus on evolution of organisational forms over time.

 Use a biological analogy to look at organisational

development

 Concentrate on two distinct approaches

 Economic

 Sociological

Biological Analogy

Evolutionary

approach

- Cumulative adaptation

Creationist

approach

- Deliberate design

Darwinist Lamarckian

Why do Giraffes has long necks?

Lamarckian Approach

Based on two principles

1. The inheritance of acquired characteristics

- captures inter-generational effect.

2. The principle of use and disuse

- those parts that are used grow bigger, others wither away.

Darwinian Approach

Emphasises role

of Cumulative

Natural Selection

Individual

variations Natural

selection Retention

Biology and Organisations

How useful is the biological analogy to understanding

organisations?

Differences - Organisations are created and constructed by

human actors

Similarities - Organisations have environments

- Environments play a role in explaining the

development of organisational forms.

Selection versus Adaptation

- focus of organisational theory on selection process

Organisational Ecology

Michael Hannan and John Freeman (1989).

Sociological approach with elements of economic concepts

Main focus of understanding various rates of change in

organisational populations, notably the ‘demography of

organisations’:

- birth,

- growth,

- decline and

- death.

Organisational Ecology

Core assumption is that organisations are inert

(relative inertia).

Why?

Efficiency -> No

Hannan and Freeman argument based on organisations and

‘ad-hoc’ groups having different competencies which lead

to inertia:

- reliability

- routines

- accountability

- reproducible

Organisational Ecology

How do organisational populations develop over time?

Two forces are at work which affect the density of the

population. Both increase with age but in opposite

direction:

1. Competition

2. Legitimation - refers to ‘social acceptance’ of the

organisational form.

An Evolutionary Theory of

Economic Change Richard Nelson and Sidney Winter (1982)

Economic Perspective

as with ecology approach it emphasises

 organisational routines and limitations of

organisational adaptability

 analysis of population

 importance of environmental selection (self

maintenance vs major change)

Organisational Routines

Primary concept to denote organisational functioning

is routines:

1. Require exercise

2. Involve tacit knowledge

3. Serve as organisational memories

4. Serve as an organisational truce

Routines explain why orgs are resistant to change as

choice is suppressed

‘Routine changing processes are themselves routine

guided.’

Comparison of Evolutionary

Approaches Similarities:

 Emphasis on organisational routines and on limits to

organisational adaptability.

 Importance of environmental selection

Differences:

 What is it that is selected by the environment?

 What goes on within the organisation?

 Descriptions of organisations and their relative

success.

Further Developments

1. Analysis of organisations as ‘bundles of routinised

competences’.

- Can provide a unifying framework for a number of observations, for example why does first mover advantage

result in significant returns.

2. Intra-organisational ecology and evolution

- i.e. what goes on within the organisation?

Induced strategy process vs Autonomous strategy process

(Burgelman)