Organizational Society

We live in an organizational society. In traditional historical societies, family structure acted as the center of life, but in modern developed economies, organizations are central. Think about it: We are born in organizations (hospitals), are educated in organizations, worship in organizations, work in organizations, play or enjoy sports in organizations, are entertained in or by organizations, and will (probably) die in an organization. And, when the time comes for burial, the largest organization of all—the state—must grant official permission (Etzioni, 1964).

One of the hallmarks of a healthy, democratic society is that it tends to be characterized by a proliferation of various organizations (i.e. not only private sector organizations but also a proliferation of volunteer and non-profit organizations). While the focus of this course is on business organizations, it important to understand that all organizations share a number of common features and structures. Anytime you get a large group of people engaged in formal, goal-directed activity, a number of similar dynamics emerge. For example, all organizations

• have a culture,
• contain individual differences relative to personality traits or attitudes,
• emphasize the importance of goals and goal measurement,
• have formal objectives,
• involve groups and ensuing group dynamics, and
• have a need for leadership.

Whether they are profit-making, nonprofit, charitable, volunteer, or governmental agencies, all organizations have—at a conceptual and structural level—far more commonalities than differences. For example, on the surface, you might think that the FBI and the Catholic Church are very different organizations. They are. And yet, if you look at them through various conceptual lenses—such as how the organization is formally structured, how culture functions, and so on—these two seemingly divergent organizations actually share a number of common features.

One way of appreciating this commonality among different types of organizations is to consider what happens when any organization gets large. Consider the example of someone who opens a small mom-and-pop restaurant. (A lot of today's major corporations started out as small entrepreneurial enterprises.) Let’s say they have a small restaurant with a very small staff. "Mom" or "Pop" does all the cooking, but the owner knows all the recipes, knows all the employees by name, and so forth. The business prospers. The owner decides to open a second location, which in turn prospers. Before long, they now have a medium-sized restaurant chain, with 40 locations spanning six different states. Suddenly, this is a big, somewhat-complex organization—and, as with any large organization, it needs structure, rules, systems, and procedures For example, this restaurant chain will need standardized recipes and menus across locations, as well as formal job descriptions for employees. It will need accounting procedures, a supply chain, formalized compensation and reward plans, formalized training and evaluation procedures, and systematic hiring and recruiting practices. These types of structuring processes occur even in nonprofit or charitable organizations.

Reference

Etzioni, A. (1964). Modern organizations. Englewood Cliffs, NJ: Prentice Hall.