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(Note) Thompson (1962) Domains of Organized Action

This document summarizes Thompson's 1962 work on organizational domains and their relationships with environments. It makes three key points: 1. An organization's domain identifies what inputs it depends on from its environment, while the environment determines who the organization depends on. 2. Organizations seek to manage dependencies and acquire power over task environments by strategies like contracting, coopting, and coalescing. 3. Facing many constraints, organizations will either seek power over remaining task sectors or enlarge their task environment to reduce uncertainties.

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0% found this document useful (0 votes)
229 views3 pages

(Note) Thompson (1962) Domains of Organized Action

This document summarizes Thompson's 1962 work on organizational domains and their relationships with environments. It makes three key points: 1. An organization's domain identifies what inputs it depends on from its environment, while the environment determines who the organization depends on. 2. Organizations seek to manage dependencies and acquire power over task environments by strategies like contracting, coopting, and coalescing. 3. Facing many constraints, organizations will either seek power over remaining task sectors or enlarge their task environment to reduce uncertainties.

Uploaded by

Elaine Chen
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© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Note on Thompson, J. 1962. Domains of organized action. # EXCHANGE AND POWER/DEPENDENCE IN AND AMONG ORGANIZATIONS Ref: Thompson, J. 1962.

Domains of organized action. Ch. 3 in ORGANIZATIONS IN ACTION. McGraw.

Domain of organization (Levine & White, 1961)


A useful concept for analysis of all types of complex organizations Components: (1) area of business (2) population served (3) product/services rendered o e.g., (1) diseases covered (for a hospital)

There are interdependencies between domain and environment


Domain --> Environment: Organization's domain identifies the points at which the organization is dependent on inputs from the environment. Environment ---> Domain: The composition of the environment, the location within it of capacities, in turn determines upon whom the organization is dependent.

Organizational environment = Task environment (+ culture) + environment beyond task environment

Task environment (Dill, 1958)/Organization set (Evan, 1966)


Refers to the environment which are "relevant or potentially relevant to goal setting and goal attainment" Four major sectors: (1) Customers (both distributors and users) (2) Suppliers of materials, labor, capital, equipment, and work space; (3) Competitors for both markets and resources; (4) Regulatory groups, including governmental agencies, unions, and interfirm associations

Domain consensus --> Exchange relationship between domain and task environment --> Decision of domain
There is exchange relationship between organization and its task environment. Three main categories of typically exchanged elements: 1. Business opportunities: Referral of cases, clients, or patients 2. Labor service: giving or receiving of labor services encompassing the use of volunteers, lent personnel, and offering of instruction to personnel of other organizations 3. Other resources: Sending or receiving of resources other than labor services, including funds, equipment, case and technical information Domain consensus o Enables us to deal with operational goals (Perrow, 1961a) without 2 challenges of operational goals (1) imputing to the organization the human quality of motivation and (2) assuming a "group mind" <both are about individual goals or motives> o Defines a set of expectations both for members of an organization and for others with whom they interact, about what the organization will and will not do.

ELAINE CHEN

Note on Thompson, J. 1962. Domains of organized action. # EXCHANGE AND POWER/DEPENDENCE IN AND AMONG ORGANIZATIONS

Management of interdependence (as a foundation to attain self-control)


Task environment pose contingencies and constraints for organizations --> interfere with the attainment of rationality Contingencies: Task environment of complex organizations are pluralistic/multifaceted, which means that, an organization must exchange with not one buy several elements, each of which is itself involved in a network of interdependence, with its own domain and task environment. How to manage dependency? Power and dependency o Because: a) Dependency can be seen as the obverse of power (Emerson, 1962). b) An organization is dependent on some element of its task environment (1) in proportion to the organization's need for resources or performances which that element can provide and (2) in inverse proportion to the ability of other elements to provide the same resource or performance (Emerson, 1962). o SO: an organization has power, relative to an element of its task environment, to the extent that the organization has capacity to satisfy needs of that element and to the extent that the organization monopolizes that capacity. o SO WHAT?: benefit the analysis of complex organization and their domains a) Frees us from the necessity of viewing power as some generalized attribute of the organization, and leads us to consider net power as resulting from a set of relationships between the organization and several elements of its pluralistic task environment. (So an organization could be relatively powerful/powerless to input/output sectors) b) Does not rest on any assumptions of intent or usage c) Provides an important escape from the "zero-sum" concept of power (Emerson, 1962; Parsons, 1960), which assumes that in a system composed of A and B, the power of A is power at the expense of B. By considering power in the context of interdependence, there is possibility that A and B becoming increasingly powerful with regard to each other (increased net power caused by coalitions) Competitive strategy o Proposition 1: Under norms of rationality, organizations seek to minimize the power of task-environment elements over them by maintaining alternatives. o Proposition 2: Organizations subject to rationality norms and competing for support seek prestige. o Proposition 3: When support capacity is concentrated in one or a few elements of the task environment, organizations under norms of rationality seek power relative to those on whom they are dependent.

The acquisition of power (How to achieve proposition 3)


Cooperative strategy o Demonstrate the organization's capacity to reduce uncertainty for the environmental element, and must make a commitment to exchange that capacity.
2

ELAINE CHEN

Note on Thompson, J. 1962. Domains of organized action. # EXCHANGE AND POWER/DEPENDENCE IN AND AMONG ORGANIZATIONS Three different degrees of cooperation and commitment Contracting: the negotiation of an agreement for the exchange of performances in the future Contractual agreement may rest on (1) faith and belief that the other will perform in order to maintain a reputation or prestige (Prop.2) or (2) institutional patterns whereby third parties can be depended upon to evaluate fulfillment of obligations and assess penalties for failure <e.g., legal>(Macaulay, 1961) Coopting: the process of absorbing new elements into the leadership or policy-determining structure of an organization as a means of averting threats to its stability or existence (Selznick, 1949) Increase the certainty of future support A more constraining form of cooperation than contracting (may exert influence on other aspects of the organization) Coalescing: a combination or joint venture with another organization or organizations in the environment. May be unstable/have a stated terminal point A even more constraining form of cooperation than coopting (requires a commitment to future join decision making) Refined Proposition 3: o Proposition 3a: When support capacity is concentrated and balanced against concentrated demands the organizations involved will attempt to handle their dependence through contracting. o Proposition 3b: When support capacity is concentrated but demand dispersed, the weaker organizations will attempt to handle its dependence through coopting. o Proposition 3c: When support capacity is concentrated and balanced against concentrated demands, but the power achieved through contracting is inadequate, the organizations involved will attempt to coalesce. o

Defense of Domain
o Proposition 4: The more sectors in which the organization subject to rationality norms is constrained, the more power the organization will seek over remaining sectors of its task environment. Proposition 5: The organization facing many constraints and unable to achieve power in other sectors of its task environment will seek to enlarge the task environment.

ELAINE CHEN

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