The forces that influence organisational behaviour

1. The Government

1.1. Most decisions made affect organisational decisions and ultimately behaviours, especially those concerning labor laws, environmental rights, political changes, taxes and sustainable development. Shapes the standards or norm of the market.

1.1.1. Most businesses will pursue legitimacy as an end goal as an organisation. (When legitimacy is the generalised perception of when the actions of an organisation is desirable,proper, commendable in a social norm determined by stakeholders.

1.2. One of big 3 stakeholders apart from businesses and CSOs.

1.2.1. Explicit coercive pressure can be applied to firms in order to force them to comply to a decision if organisations 'misbehave' or do not comply. This is known as coercive isomorphism. Organizations today are slowly becoming homogeneous due to the domains. and more organized around around said laws set to conform to wider institutions, in this case the government.

1.2.1.1. This is very effective as the companies must comply or face the risks of the wraith of the government in the form of fines or even revoking rights to do business in the country.

1.2.1.2. Use of the carrot and stick method appropriate for governments. Firms that consistently operate within regulations without breaking rules should be rewarded with grants, tax breaks. While firms who constantly break the law and rules should be punished more often with fines that progressively gets heftier per rule break.

1.3. The most important concerning this topic is the sustainability of development, as climate change threat is more real and approaching, we must ensure firms operate and comply within government rules and regulations set.

1.3.1. Ensure that firms live up and have action on their corporate social responsibility policies, the watchdog apart from CSOs and pressure groups.

2. The economic climate

2.1. One of the larger influences alongside governemt

2.2. The company's behaviour depends largely on economy, will be conservative during a recession and risk taking during a growth period.

3. Civil Society Organisations (CSO) and pressure groups

3.1. Referred to as the third institution in society apart from businesses and government

3.1.1. Influences firms by legal protests, boycotts and calls for corporate social responsibility action, usually more successful than individuals or sole activists as a group has more reach and influence.

3.1.2. Usually a group of citizens representing a common goal/interest shared, can be an informal or formal group like a local area committee or Amnesty International

3.2. Can manipulate or be manipulated by firms or as a powerful 'actor' to ease pressures off an organisation as a large stakeholder.

3.2.1. As one of 3 stakeholder they are able to hold organisations up to the standard set by governments or in a collaboration between said firm; to do this like said they can either make a deal or monitoring constantly and reporting any wrong doings to governments and the public like a watchdog.

3.2.1.1. Companies will more likely to 'behave' as they do not want to risk reputation being tarnished and being boycotted and having their profits affected, such as an oil company reacting to an oil spill as fast as they can to clean up the situation.

3.2.1.2. Known as implicit coercive pressure-it is reputational/regional pressures to conform to, and is assumed to derive form public opinion as represented in mass media and NGO's advocacy and monitoring of these companies, its called the implicit coercive process.

4. Technological changes and Technology

4.1. Changes to technology means changes in productivity/ efficiency for a organisation, as production and/or process innovation are ways to gain competitive or sometimes even sustained competitive advantages over its competitions

4.1.1. Can affect a firm's resource based view- a managerial framework that determines the strategic resources organisations can exploit in order to obtain a sustainable competitive advantage.

4.1.1.1. To achieve this there are steps, identifying the organisation's potential key resource(s). Then check whether it passes the VRIN criteria. To confirm how valuable it is, how rare the said resource is, how imperfectly imitable which cannot be obtained easily by other firms and lastly non substitutable which means it is not replacable by non rare resources. Once it passes the criteria the firm must develop, nurture and protect the resources.

4.1.1.2. A resource(s) can be defined as all assets, capabilities, organizational processes, firm attributes, information, knowledge, etc. controlled by a firm that allows them to think of any ideas and implement them that improves their efficiency and effectiveness.

4.1.2. Of course, this change depends on the complexity of the process and the costs/ returns.

4.2. Technology provides the one of the resources with which people work. Its impossible to accomplish anything with our bare hands, especially in today;s modern world. One of the great benefit of technology is that it enables people to do work better and more efficiently and effectively,. But it may be restrictive also in various ways. Individuals that have a lack of technological knowledge cannot work with technology and in a sense, can't actually work. But technology does decrease costs per unit and improves upon the quality and quality checking of products and/or services.

5. Customer demands/ Market trends

5.1. Customers are important force that affects an organisation and its behaviour as they are the ones who will be consuming a firm's good or service.

5.1.1. Need to stay innovative to meet market's demands whether it be product or production innovation so that an organisation can keep or extend its comparative advantage.

5.1.2. It is possible to create a product/service that customers may not know they want, leading to being a market leader in a new market segment and earning potentially a new revenue market

5.1.3. Part of competitive isomorphism as a result,

5.2. Firms need to follow the market trends and stay in touch with the consumer base so that they do not lose market share.

6. Environment

6.1. Consists of stakeholders like governments, NGOs/ CSOs, competitors, peers, customers and other stakeholders. Firms operate in both an external and internal environment.

6.1.1. Usually defined by how big the business is and what type of business do they operate in.

6.1.2. Within its definition there are expectations around what is considered to be acceptable behaviour .

6.1.2.1. More pressure means more likely a firm will conform to its 'normal' or accepted behaviour in the industry.

6.2. All organizations operate in both internal and external environment. A single organization does not exit alone. An organization plays a small part of a lager system that contains many other elements, such as government, the family and other organizations. Any kinds of change in the environment effect the organization. Citizens expect organizations should be socially responsible. There is a direct impact of several tread unions of organizations.

6.2.1. In environments, pressure can be applied/come from externally and internally. An example of external pressure would be that government pressures a firm to hire more local workers. internal pressure would be senior executives pressuring a CEO to adapt changes to internal structure.

7. People in the business

7.1. Internal structure changes

7.1.1. The changing of a company structure can be due to both internal or external forces.

7.1.1.1. An example of internal force would be senior management calling for changes due to a variety of reasons- low performance from team, not being able to hit targets, moral hazard/principle agent problems.

7.1.1.1.1. Visionary, influential leaders in an organisation such of those like Steve Jobs and Bill Gates can lead and motivate their workers to innovate with new products especially in Apple's early years with Jobs.

7.1.1.2. External force could be down to another company's structure being more effective/yielding better results for the competing firm, compared to the current structure used by the firm currently as the firm may decide to switch to using the competition's structure to copy their results as well. (Mimetic isomorphism)

7.1.2. If an organisation is struggling to hit its targets/goals, it may fall back on mimetic isomorphism/ process- That is to copy/imitate another firm's structure due to the belief that the structure of said organization is beneficial.

7.1.3. A structure basically defines the formal relation and use of labour in an organisation. Top level and low level workers both assemble in order to accomplish their assigned tasks given. They are related in structural way so that their work can be effectively coordinated. Because there is no organization can be successful without proper coordination.

7.2. People or labour make up the internal social system of a firm and this consists of individuals and teams. These teams can be any size and informal or formal. The groups are dynamic- they can be formed, change and disband. As an organization is combination of group of labour, managers have the crucial task of handling these talent right. This is a tough problem to solve, as to guide individuals who all have different educational backgrounds, talent and perspectives. Managers must know the person, predict and control them or at least try to adequately. As they should build a long lasting and effective relationship among the employees and themselves to motivate each other mutually.

7.2.1. Labour , especially the higher ups or people in senior positions should set an example to all workers by performing/behaving how they want their workers to behave by demonstrating professional and efficient behaviour themselves. It tends to rub off to the lower levels if they can learn from a good leader as an example.

8. Competitors/ Peers

8.1. The competition is very important and should not be forgotten as these are the obstacles standing in the way of a firm's success

8.1.1. Sometimes firms can come together in the market to the inter-organizational networks that span organizations. Norms developed during education are entered into organizations. Inter-hiring between existing industrial firms also encourages isomorphism, making a uniform standard industry wide.

8.1.1.1. People from the same educational backgrounds will approach problems in much the same way. Socialization on the job reinforces these conformities.

8.2. Behaviour of a firm can be affected by competition or affect the competition.

8.2.1. If an organization cannot hit its targets or goals, it may copy another more successful structure of its competitors in hopes of obtaining the same result. This is known as mimetic ismorphism.

8.2.1.1. Competing firm(s) may also do the same if said firm is more successful than its competitions.

8.3. All competitors in the market are locked in a constant battle to oust each other for profits and market share.

8.3.1. This is done through innovation of new ideas for processes and products to gain comparative advantages for production to lower their costs and become more efficient of developing an all new product together than has a unique selling point compared to other homogenous goods in the market currently.