Strategies of organisational environment
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This document discusses three strategies organizations use to deal with their environmental forces: insulation, control, and adaptation. Insulation strategies minimize the environment's negative impact through buffering, leveling, and rationing. Control strategies gain influence over aspects of the environment through agreements, building prestige, and lobbying. Adaptation strategies adjust the organizational structure and systems/processes to better cope with the demands of the environment.
Strategies of organisational environment
- 2. INTRODUCTION An organization faces two problems while designing the strategies : a) Interdependence between organization and the environment. b) Uncertain exchange between the organization and the environment. The organization has to overcome these two problems to deal with the environment. There are THREE strategies to over come it.
- 4. THREE STRATEGIES • Strategies for insulating the organization from the environmental forces. • Strategies for gaining the control over certain aspects of the environment. • Strategies for organizational adaptation.
- 5. INSULATION OF THE ORGANISATION Minimizing the negative impact of environmental forces. Since the organization is an open system, this can be done only selectively. Strategy of boundary spanning can be adopted as an alternative like marketing research, environmental analysis etc
- 7. Insulations are: Buffering : i) avoids impact of uncertainty. ii) acts as a shock absorber. Smoothening or leveling: i) adjusting the supply according to the demand ii) increase and decrease of demand. Rationing: i) method of curtaining demand. ii) partial fulfilment of demand.
- 8. GAINING CONTROL OVER THE ORGANISATION • The basic objective of this type of strategy is to gain control over some aspects of the environment. • This is to reduce the dependence of the organization on the environment. • This can be done through number of ways like-
- 9. GAINING CONTROL OVER THE ORGANISATION AGREEMENT CREATION OF PRESTIGE LOBBYING
- 10. GAINING CONTROL OVER THE ORGANIZATION Creation of Prestige- Environmental resources are allocated to those areas with better usage. i) It helps attracts environmental resources ii) It helps reduce dependence on environment Agreement: To gain control over the environment, an organization may enter into agreement with environmental elements on which it depends i) cooperative strategy. ii) reduces uncertainty in the environment Cooptation : Process of absorbing new elements into the policy making structure to avert threats and maintain stability. i) create awareness and common understanding to reduce environmental uncertainty.
- 11. GAINING CONTROL OVER THE ORGANIZATION Coalescing : Two or more organization are merged which have some sort of interdependency in the form of procurements of inputs, disposal of outputs etc. i) Merged environments mean better control of environment and pooled resources Procurement of Key Personnel : In an organization, it can enhance its capacity to overcome the environmental pressure. Lobbying: Process of convincing the various elements of the environment in favor of the organization. i) Effective in an association ii) Eg- Federation of Indian Chambers of Commerce and Industry
- 12. ORGANIZATIONAL ADAPTATION One of the most frequently adopted strategies to respond to the environment by organizations is by: Adaptation of Organization Structure: designed according to needs of the environment. For eg, Mechanical structure- stable environment Organic structure- Dynamic environment Adaptation of Systems and Processes: Various organizational systems processes like control & planning system, leadership system, information system human designed according to the needs of the environment to be able to cope with the environment
- 14. THANK YOU!