An organization or organisation (
Commonwealth English;
see spelling differences), is an
entity—such as a
company
A company, abbreviated as co., is a Legal personality, legal entity representing an association of people, whether Natural person, natural, Legal person, legal or a mixture of both, with a specific objective. Company members share a common p ...
, an
institution
Institutions are humanly devised structures of rules and norms that shape and constrain individual behavior. All definitions of institutions generally entail that there is a level of persistence and continuity. Laws, rules, social conventions a ...
, or an
association—comprising one or more
people and having a particular purpose.
The word is derived from the Greek word ''organon'', which means tool or instrument, musical instrument, and
organ
Organ may refer to:
Biology
* Organ (biology), a part of an organism
Musical instruments
* Organ (music), a family of keyboard musical instruments characterized by sustained tone
** Electronic organ, an electronic keyboard instrument
** Hammond ...
.
Types
There are a variety of legal types of organizations, including
corporations,
governments,
non-governmental organizations,
political organizations,
international organizations,
armed forces
A military, also known collectively as armed forces, is a heavily armed, highly organized force primarily intended for warfare. It is typically authorized and maintained by a sovereign state, with its members identifiable by their distinct ...
,
charities
A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being (e.g. educational, religious or other activities serving the public interest or common good).
The legal definition of a cha ...
,
not-for-profit corporations,
partnerships,
cooperatives, and
educational institutions, etc.
A
hybrid organization is a body that operates in both the
public sector and the
private sector simultaneously, fulfilling public duties and developing commercial market activities.
A
voluntary association is an organization consisting of volunteers. Such organizations may be able to operate without legal formalities, depending on jurisdiction, including informal
clubs or coordinating bodies with a goal in mind which they may express in the form of an
manifesto
A manifesto is a published declaration of the intentions, motives, or views of the issuer, be it an individual, group, political party or government. A manifesto usually accepts a previously published opinion or public consensus or promotes a ...
,
mission statement
A mission statement is a short statement of why an organization exists, what its overall goal is, the goal of its operations: what kind of product or service it provides, its primary customers or market, and its geographical region of operation ...
, or in an informal manner reflected in what they do because remember every action done by an organization both legal and illegal reflects a goal in mind.
Organizations may also operate secretly or illegally in the case of
secret societies,
criminal organization
Organized crime (or organised crime) is a category of transnational, national, or local groupings of highly centralized enterprises run by criminals to engage in illegal activity, most commonly for profit. While organized crime is generally th ...
s, and
resistance movements. And in some cases may have obstacles from other organizations (ex:
MLK's organization).
What makes an organization recognized by the government is either filling out
Incorporation (business)
Incorporation is the formation of a new corporation. The corporation may be a business, a nonprofit organization, sports club, or a local government of a new city or town.
In the United States
Specific incorporation requirements in the United ...
or recognition in the form of either societal pressure (ex:
Advocacy group
Advocacy groups, also known as interest groups, special interest groups, lobbying groups or pressure groups use various forms of advocacy in order to influence public opinion and ultimately policy. They play an important role in the developm ...
), causing concerns (ex:
Resistance movement) or being considered the spokesperson of a group of people subject to negotiation (ex: the
Polisario Front being recognized as the sole representative of the Sahrawi people and forming a partially recognized state.)
Compare the concept of
social groups, which may include non-organizations.
Organizations and
institutions
Institutions are humanly devised structures of rules and norms that shape and constrain individual behavior. All definitions of institutions generally entail that there is a level of persistence and continuity. Laws, rules, social conventions a ...
can be synonymous, but
Jack Knight writes that organizations are a narrow version of institutions or represent a cluster of institutions; the two are distinct in the sense that organizations ''contain'' internal institutions (that govern interactions between the members of the organizations).
Structures
The study of organizations includes a focus on optimising
organizational structure. According to
management science, most
human organizations fall roughly into four types:
*
Committees or
juries
*
Ecologies
Ecology () is the study of the relationships between living organisms, including humans, and their physical environment. Ecology considers organisms at the individual, population, community, ecosystem, and biosphere level. Ecology overlaps w ...
*
Matrix
Matrix most commonly refers to:
* ''The Matrix'' (franchise), an American media franchise
** '' The Matrix'', a 1999 science-fiction action film
** "The Matrix", a fictional setting, a virtual reality environment, within ''The Matrix'' (franchi ...
organizations
*
Pyramids or
hierarchies
Committees or juries
These consist of a group of peers who decide as a group, perhaps by voting. The difference between a
jury and a
committee is that the members of the committee are usually assigned to perform or lead further actions after the group comes to a decision, whereas members of a jury come to a decision. In
common law countries, legal juries render decisions of guilt, liability, and quantify damages; juries are also used in athletic contests, book awards, and similar activities. Sometimes a selection committee functions like a jury. In the Middle Ages, juries in continental Europe were used to determine the law according to consensus among local notables.
Committees are often the most reliable way to make decisions.
Condorcet's jury theorem proved that if the average member votes better than a roll of dice, then adding more members increases the number of majorities that can come to a correct vote (however correctness is defined). The problem is that if the average member is subsequently ''worse'' than a roll of dice, the committee's decisions grow worse, not better; therefore, staffing is crucial.
Parliamentary procedure, such as
Robert's Rules of Order, helps prevent committees from engaging in lengthy discussions without reaching decisions.
Ecologies
This organizational structure promotes internal
competition. Inefficient components of the organization starve, while effective ones get more work. Everybody is paid for what they actually do, and so runs a tiny business that has to show a
profit
Profit may refer to:
Business and law
* Profit (accounting), the difference between the purchase price and the costs of bringing to market
* Profit (economics), normal profit and economic profit
* Profit (real property), a nonpossessory intere ...
, or they are fired.
Companies that utilize this organization type reflect a rather one-sided view of what goes on in
ecology. It is also the case that a natural
ecosystem has a natural border –
ecoregions do not, in general, compete with one another in any way, but are very autonomous.
The
pharmaceutical company GlaxoSmithKline
GSK plc, formerly GlaxoSmithKline plc, is a British multinational pharmaceutical and biotechnology company with global headquarters in London, England. Established in 2000 by a merger of Glaxo Wellcome and SmithKline Beecham. GSK is the ten ...
talks about functioning as this type of organization i
this external articlefrom ''
The Guardian''.
By:Bastian Batac De Leon.
Matrix organization
This organizational type assigns each worker two bosses in two different hierarchies. One hierarchy is "functional" and assures that each type of expert in the organization is well-trained, and measured by a boss who is a super-expert in the same field. The other direction is "executive" and tries to get projects completed using the experts. Projects might be organized by products, regions, customer types, or some other schemes.
As an example, a company might have an individual with overall responsibility for products X and Y, and another individual with overall responsibility for engineering, quality control, etc. Therefore, subordinates responsible for quality control of project X will have two reporting lines. The United States aerospace industries were the first to officially use this organizational structure after it emerged in the early 1960s.
Pyramids or hierarchical
A
hierarchy
A hierarchy (from Greek: , from , 'president of sacred rites') is an arrangement of items (objects, names, values, categories, etc.) that are represented as being "above", "below", or "at the same level as" one another. Hierarchy is an important ...
exemplifies an arrangement with a
leader who leads other individual members of the organization. This arrangement is often associated with the basis that there are enough to imagine a real pyramid, if there are not enough stone blocks to hold up the higher ones, gravity would irrevocably bring down the monumental structure. So one can imagine that if the leader does not have the support of his subordinates, the entire structure will collapse. Hierarchies were
satirized in ''
The Peter Principle'' (1969), a book that introduced ''hierarchiology'' and the saying that "in a hierarchy, every employee tends to rise to his level of incompetence."
Theories
In the social sciences, organizations are the object of analysis for a number of disciplines, such as
sociology,
economics,
political science,
psychology,
management, and
organizational communication. The broader analysis of organizations is commonly referred to as
organizational structure,
organizational studies,
organizational behavior
Organizational behavior (OB) or organisational behaviour is the: "study of human behavior in organizational settings, the interface between human behavior and the organization, and the organization itself".Moorhead, G., & Griffin, R. W. (1995) ...
, or organization analysis. A number of different perspectives exist, some of which are compatible:
* From a functional perspective, the focus is on how entities like businesses or state authorities are used.
* From an institutional perspective, an organization is viewed as a purposeful structure within a social context.
* From a process-related perspective, an organization is viewed as an entity being (re-)organized, and the focus is on the organization as a set of tasks or actions.
Sociology can be defined as the science of the
institutions
Institutions are humanly devised structures of rules and norms that shape and constrain individual behavior. All definitions of institutions generally entail that there is a level of persistence and continuity. Laws, rules, social conventions a ...
of
modernity; specific institutions
serve a function, akin to the individual organs of a coherent body. In the social and political sciences in general, an "organization" may be more loosely understood as the planned, coordinated, and purposeful action of human beings working through collective action to reach a common goal or construct a tangible
product. This action is usually framed by formal membership and form (institutional rules). Sociology distinguishes the term organization into planned formal and unplanned informal (i.e. spontaneously formed) organizations. Sociology analyses organizations in the first line from an institutional perspective. In this sense, the organization is an enduring arrangement of elements. These elements and their actions are determined by rules so that a certain task can be fulfilled through a system of coordinated
division of labor
The division of labour is the separation of the tasks in any economic system or organisation so that participants may specialise (specialisation). Individuals, organizations, and nations are endowed with, or acquire specialised capabilities, and ...
.
Economic approaches to organizations also take the
division of labor
The division of labour is the separation of the tasks in any economic system or organisation so that participants may specialise (specialisation). Individuals, organizations, and nations are endowed with, or acquire specialised capabilities, and ...
as a starting point. The division of labor allows for (economies of)
specialization
Specialization or Specialized may refer to:
Academia
* Academic specialization, may be a course of study or major at an academic institution or may refer to the field in which a specialist practices
* Specialty (medicine), a branch of medical ...
. Increasing specialization necessitates coordination. From an economic point of view, markets and organizations are alternative coordination mechanisms for the execution of
transaction
Transaction or transactional may refer to:
Commerce
* Financial transaction, an agreement, communication, or movement carried out between a buyer and a seller to exchange an asset for payment
*Debits and credits in a Double-entry bookkeeping sys ...
s.
An organization is defined by the elements that are part of it (who belongs to the organization and who does not?), its
communication (which elements communicate and how do they communicate?), its autonomy (which changes are executed autonomously by the organization or its elements?), and its rules of action compared to outside events (what causes an organization to act as a collective actor?).
By coordinated and planned cooperation of the elements, the organization is able to solve tasks that lie beyond the abilities of the single element. The price paid by the elements is the limitation of the
degrees of freedom
Degrees of freedom (often abbreviated df or DOF) refers to the number of independent variables or parameters of a thermodynamic system. In various scientific fields, the word "freedom" is used to describe the limits to which physical movement or ...
of the elements. Advantages of organizations are enhancement (more of the same), addition (combination of different features), and extension. Disadvantages can be inertness (through coordination) and loss of
interaction.
Among the theories that are or have been influential are:
*
Activity theory is the major theoretical influence, acknowledged by de
Clodomir Santos de Morais
Clodomir Santos de Morais (30 September 1928 – 25 March 2016) was a Brazilian sociologist who originated the Organization Workshop (OW) and the associated Activity-based Large Group Capacitation Method (LGCM).
In the 1940s and 1950s de Mora ...
in the development of
Organization Workshop method.
*
Actor–network theory, an approach to social theory and research, originating in the field of science studies, which treats objects as part of social networks.
*
Complexity theory and organizations, the use of
complexity theory in the field of
strategic management
In the field of management, strategic management involves the formulation and implementation of the major goals and initiatives taken by an organization's managers on behalf of stakeholders, based on consideration of Resource management, resour ...
and organizational studies.
*
Contingency theory, a class of behavioral theories that claim that there is no best way to organize a corporation, to lead a company, or to make decisions.
*
Critical management studies, a loose but extensive grouping of theoretically informed critiques of management, business, and organization, grounded originally in a
critical theory
A critical theory is any approach to social philosophy that focuses on society and culture to reveal, critique and challenge power structures. With roots in sociology and literary criticism, it argues that social problems stem more from soci ...
perspective
*
Economic sociology, studies both the social effects and the social causes of various economic phenomena.
*
Enterprise architecture, the conceptual model that defines the coalescence of organizational structure and organizational behavior.
*
Garbage Can Model, describes a model which disconnects problems, solutions, and decision-makers from each other.
*
Principal–agent problem
The principal–agent problem refers to the conflict in interests and priorities that arises when one person or entity (the "agent") takes actions on behalf of another person or entity (the " principal"). The problem worsens when there is a gre ...
, concerns the difficulties in motivating one party (the "agent"), to act in the best interests of another (the "principal") rather than in his or her own interests
*
Scientific management
Scientific management is a theory of management that analyzes and synthesizes workflows. Its main objective is improving economic efficiency, especially labor productivity. It was one of the earliest attempts to apply science to the engineer ...
(mainly following
Frederick W. Taylor), a theory of
management that analyses and synthesizes
workflows.
*
Social entrepreneurship, the process of pursuing innovative solutions to social problems.
*
Transaction cost theory, the idea that people begin to organize their production in firms when the transaction cost of coordinating production through the market exchange, given imperfect information, is greater than within the firm.
*
Weber's Ideal of Bureaucracy (refer to
Max Weber
Maximilian Karl Emil Weber (; ; 21 April 186414 June 1920) was a German sociologist, historian, jurist and political economist, who is regarded as among the most important theorists of the development of modern Western society. His ideas profo ...
's chapter on "Bureaucracy" in his book ''
Economy and Society'')
Leadership
A
leader in a formal,
hierarchical organization, is appointed to a managerial position and has the right to command and enforce obedience by virtue of the authority of his position. However, he must possess adequate personal attributes to match his authority, because authority is only potentially available to him. In the absence of sufficient personal competence, a manager may be confronted by an emergent leader who can challenge his role in the organization and reduce it to that of a figurehead. However, only the authority of position has the backing of formal sanctions. It follows that whoever wields personal influence and power can
legitimize this only by gaining a formal position in the hierarchy, with commensurate authority.
Formal organizations
An organization that is established as a means for achieving defined
objectives has been referred to as a
formal organization. Its design specifies how goals are subdivided and reflected in subdivisions of the organization. Divisions, departments, sections, positions,
jobs, and tasks make up this work
structure
A structure is an arrangement and organization of interrelated elements in a material object or system, or the object or system so organized. Material structures include man-made objects such as buildings and machines and natural objects such as ...
. Thus, the formal organization is expected to behave impersonally in regard to relationships with clients or with its members. According to Weber's definition, entry and subsequent advancement is by merit or seniority. Each employee receives a salary and enjoys a degree of tenure that safeguards him from the arbitrary influence of superiors or of powerful clients. The higher his position in the hierarchy, the greater his presumed expertise in adjudicating problems that may arise in the course of the work carried out at lower levels of the organization. It is this bureaucratic structure that forms the basis for the appointment of heads or chiefs of administrative subdivisions in the organization and endows them with the authority attached to their position.
Informal organizations
In contrast to the appointed head or chief of an administrative unit, a leader emerges within the context of the
informal organization that underlies the formal structure. The informal organization expresses the personal
objectives and
goals of the individual
membership. Their objectives and goals may or may not coincide with those of the formal organization. The informal organization represents an extension of the social structures that generally characterize human life – the spontaneous emergence of groups and organizations as ends in themselves.
In prehistoric times, man was preoccupied with his personal security, maintenance, protection, and survival. Now man spends a major portion of his waking hours working for organizations. His need to identify with a community that provides security, protection, maintenance, and a feeling of belonging continues unchanged from prehistoric times. This need is met by the informal organization and its emergent, or unofficial, leaders.
Leaders emerge from within the structure of the informal organization. Their personal qualities, the demands of the situation, or a combination of these and other factors attract followers who accept their leadership within one or several overlay structures. Instead of the authority of position held by an appointed head or chief, the emergent leader wields influence or power. Influence is the ability of a person to gain cooperation from others by means of persuasion or control over rewards. Power is a stronger form of influence because it reflects a person's ability to enforce action through the control of a means of punishment.
The interplay between formal and informal organizations
As most organizations operate through a mix of formal and informal mechanisms, organization science scholars have paid attention to the type of interplay between formal and informal organizations. On the one hand, some have argued that formal and informal organizations operate as substitutes as one type of organization would decrease the advantages of using the other one. For instance, if parties trust each other the use of a formal contract is unnecessary or even detrimental to the relationship. On the other hand, other scholars have suggested that formal and informal organizations can complement each other. For instance, formal mechanisms of control can pave the way for the development of relational norms.
See also
*
Affinity group
*
Anticipatory socialization
*
Business organization
A business entity is an entity that is formed and administered as per corporate law in order to engage in business activities, charitable work, or other activities allowable. Most often, business entities are formed to sell a product or a servi ...
*
Coalition
A coalition is a group formed when two or more people or groups temporarily work together to achieve a common goal. The term is most frequently used to denote a formation of power in political or economical spaces.
Formation
According to ''A Gui ...
*
Collective
A collective is a group of entities that share or are motivated by at least one common issue or interest, or work together to achieve a common objective. Collectives can differ from cooperatives in that they are not necessarily focused upon an ...
*
Decentralized autonomous organization
*
History of organizations
The history of organizations describes the general history of the rise of the organization.
Early history
Since earliest times humanity has endeavoured to develop the most appropriate systems of organization to meet the challenges of a particula ...
*
List of designated terrorist organizations
*
List of environmental organizations
*
List of general fraternities
A fraternity or fraternal organization is an organized society of men associated together in an environment of companionship and brotherhood; dedicated to the intellectual, physical, and social development of its members.
Service clubs, lineage ...
*
List of international professional associations
*
List of trade unions
*
Maturity Model
*
Multidimensional organization
*
Mutual organization
*
Organizational psychology
*
Organization Workshop
*
Pacifist organization
*
Requisite organization
*
Service club
*
Size of groups, organizations, and communities
*
Umbrella organization
*
Voluntary association
References
Further reading
* Baligh, Henry H. (2006). ''Organization Structures: Theory and Design, Analysis and Prescription''. Springer New York. .
*
Coase, Ronald (1937). "
The Nature of the Firm" ''Economica'', 4(16), pp. 386–405.
*
*
* Hewlett, Roderic. (2006). The Cognitive leader. Rowman & Littlefield Pub Inc.
*
*
*
* Marshak, Thomas (1987). "organization theory," ''
The New Palgrave: A Dictionary of Economics'', v. 3, pp. 757–60.
* Mintzberg, Henry (1981). "Organization Design: Fashion or Fit" ''Harvard Business Review'' (January February)
* Morgenstern, Julie (1998). ''Organizing from the Inside Out''. Owl Books
*
Peter, Laurence J. and
Raymond Hull. ''
The Peter Principle'' Pan Books 1970
*
* Samson, D., Daft, R. (2005). Management: second Pacific Rim edition. Melbourne, Victoria: Thomson
*
*
External links
Research on Organizations: Bibliography Database and Maps
TheTransitioner.org a site dedicated to
collective intelligence
Collective intelligence (CI) is shared or group intelligence (GI) that emerges from the collaboration, collective efforts, and competition of many individuals and appears in consensus decision making. The term appears in sociobiology, politic ...
and structure of organizations
{{Authority control