How organizations depend
on their environments 77
t7 Francisco Goya's'The Sleep of
Re{son Produces Monsters'
(1797-9), etching ftom the
seties Los Caprichas 87
Courlesy of the Libmry ofcongre$
An organizationt
developmental stages 1OO
Identity d,'namics in
individuals and
organizations '105
Bsed on Hatch dnd schlt2 (2oo8).
Burs€r meal: !.r Ace Stock Limikd/
Alany; Srpd s,zd Mer (.. Roadsidc/
Gold\rtn/The Kobal Collcction
Model combining
oryanizational identity
wit}) cultura.l d]'namics 109
Nodes and ties produce
a network |1|
How organizational
boufldaries reform in
the shift from industrial
to post-industrial
societv ll9
t irapter 1
What is organization?
( )rgaDization happens when people work together to accomplish
.r,rrredesired end state orgoal.Itcan happen through intentionally
, k signed activity, spontaneous improvisation, or some
,r,rrbination ofthe two, but it a.lways depends upon coordinated
, ll{)rt. As a simple example, think about the goal of moving a large
.,rr)ne, too big for ol1e human working alone to push uphill
(lrigurc la). Two or even more won't budge it either (Figure 1b),
rnlcss they coordinate their efforts (Figure lc).
lirt people often pursue more complex goals than pushing a stone
rrPhill. Putting Neil Armstrong and Buzz Aldrin on the Moon
rrr(.:rnt coordinating everlthing {iom cleaning offices and buying
l'rrl)erclips to training the astronauts and designing, building, and
l,rrnchirg their spacecmfi. Suppllng th€ Tsukiji Fish Market in
li,kyo (JapaD) that serves the rcstaurants and fishmongers ofthe
uolld depends on the coordinated ellbrts offishing crews that sail
,'li the coasts ofCartagena (Spain), Halifax (Canada), Boston (US),
rrrrd Pusan (South Korca), and on the mostly Japanese buye$ who
ll\ to these places to survey the catch, purchase the best fish
rr\'rrilable, and crate and ship them to Tokyo. As these examples
,,lrow, thecoordination ofhumar interests and activities can range
lionr the simple to t}Ie massively complex, and its goals from the
nllrDdane to the exotic.

1. GcttiDg organized: The person in a) confi.onts a problem too b;g to
.9 handle alone, moving a la'gc stonc to the top ofa hill; b) linds hclr)
but does not use it in a coordinatcd way and so rhe stone remains at the
botrom ofthe hill; c) organizes the actions ofthosc rvho cane to help
.rnd achicvcs the dcsired orrcome
A little history
Organizing has beei, with us a long time. Prehistoric hulnalls
organized to hrnt and gatber food, find shelter, and protect and
raise their children.'fo nufiule their solls they made aft and
practiced religion. By grorping together in pursuing these goals,
they formed the first human organizations families and tribes. Of
course, chimpanzees and apes banded together before humans
appearedr and prior to that ants formed colonies and bees built
hives. On some level, all social species realize that organizing
improves their chances lbr survival in a competitive ecology.
Through otganizatioD the strenSth and creativity of many can
be directed toward survival or civilization yia developn-rents
,, t,r'hnology and the accumulation ofeconomic and c[ltura]
\\,,rlrh.
(,,rlpetition is as importantto organization as is cooperation.'lhis
,rrilirt seem contradictory, but it is not. Competition a ses from
,1, 1x'ndence on the environment to provide food and to feed other
,,,.rrls and desires. Ifresources were unlimited. then the ddve to
,,rrlirnize nightbe miDimal. If food dropped offtrees, the climate
$ temperate all year round, and nothing t ed to kill us, we night
rs
I , t l)yu'ith only those forms oforganization required to amuse ol
,.Ilirhten, s[ch as art, religion, and philosophy. But resources have
been limited. Lile pressurcs us to compete, whether that
'lsrrys
,r,r Petition is over food, terrilory, desirable mates, oriobs.
I r(lividuals compete within thei. groups over status and position,
rr(l groups compete with each othel in their quest to dominate.
L lrrs competition is always part of organization even though €
, Lirrlizations depend upon cooperation to realize their goals.
( ,)rnpared to those ofother social species like ants, bees, and apes,
r r,.complexity ofhuman organizations is enormous. Somewhere
. l,)ng the tmjectory fiom being huntels aDd gatherers to beconing
tl,,kl hands and larmels, t bes grew into villages, and later int<-r
r,,\\ns, cities, city states, and nations. Another transfbrmarlion
,u <rrned alongwith orSanizational complexity: specialization - the
1,r'rrctice of limiting oDe's acti\rties so that expeitise ir1 a speci{ic
, ornain or parlicular skill cal be achieved. !-or'exarnple, your
l,rLilding skills will likely implove ifyou do not also have to tend
i , l{ls or educale ),onr children. Ofcourse, other species pmctice
.l,r,eializatiol too. I-IoDeybee colonies can number anywhere from
,o.OOO to 60,OOO members, and within them worker bees
.;r'cialize as nulsemaids, guards, constructior, workers,
rrr(leftakers, and attendants to the queel.
r;ttcialization senes a sociely by incre$ing the qnality and valieq'
,,l roods and serwices available to its membe$ and by provi.ling
, lliriencies in their productioD and delivery that allo$'more work
 to be done with less time or effort. As communal life develops
through specialization and the interdependence it creates, human
society and its organizations become differentiated - different
people adopt different roles, and different tjpes oforgadization are
created as people with similar talents and interests work together
on specialized tasks. Further encouragernent for specialization
aud differentiation comes from iDteraction bctween societies.
Some ofthis interaction involves warfare, but in peaceful times
often prodnces exchange relationships that grow into economies.
Economies depend on trust between people. This tmst in tum
clepends upon experiences ofstdble, successful exchange. To
appreciate what this means in organizational terms requires
another concept: institution - a time-honored activity or
organization that addresses what would otherwise be a persistent
social problem by encouraging behavior that stabilizes society.
.9
Examples ofinstitutions include the handshake, money, banking,
I marriage, the family, religion, and government. Take the
institutions of money and banking. Both werc created to address
the persistent problem ofdevelopiug enough tNst in trade to
create an economy and keep it stable. People make rules about
handling money that establish organizational institutions like
banks, arrd other institutions (such as courts and prisons) to
handle those who violate the rules.
As institutions stabilized societies and relationships between them
developed into diftbrentiated city-states and nations, trade and
other organized activities came under formal control through
institutional practices such as til.x collection and the licensing of
organizations. Licensing, or chartering, involves giving
organizations legal status as entities along with the right to
engage in specified activities (such as hade, industry, law,
education).
( )rcr time, institutionalized businesses partnered with churches
.rrul amies, combining their wealth and influence to engage in
,.rploration and exploitation. E\ploration and the new tlade it
( )ught permitted local economies to grow while the potential for
l
'l
, r|loitation forged cornpetitive relationships betweei businesses
,rrrclsocieties. As this was going on, busilesses were discovering
rr|$, ways to differentiate usiD8 technology derived from the
rrvention of the machine.
I l)c invention of machines to do work led to industdalization.
lrirctories that demanded the labor of many were built to house
rrrrchines and their operatoN, and to help o$mers and suPervisors
rranage work. Workers canre from nrral areas to take advantage of
ic\v oppodunities to make a living. Cities grew dramatically as
rrrdustrialization concentEted the poPulations of the most
,rrrnonically aggressive nations and provided enormous wealth to €
llrose with the means to contlol the largest organizations. Many
1,r'ople moved fiom farms to cities, and urban
values replaced rural
,,rcs in the identities of industrialized nations.
ti)nceDtrateal populations have encouraged the develoPment of
n Nice economies that, when combined with the computer,
I'roduce another societal transformation ofat least the same
rrngnitude brought by the change fiom agriculturc to industry'
l hc computer magnifies the organizational effects ofthis
lrirnsition because computer technologl, aloDg with the ability to
, irsily trave$e the globe, allows somc economically powerf'ul
,,rganizations to grow larger than many counhies. Theil growth
hls prornoted capitalism around the world, led by giants like IBM'
llcDonalds, ABB, Siemens, Sony, and Urilever, supported by the
tr)litical alignments of capitalist count es.
l hc trade in which massive business olganizations engage has
,,rrrtributed greatly to globalization, which in turn alfects cultures
rrrrrl societies by mixing and blending their members as they travel
,rrrrund the world. These changes bring opPortunities to further
 increase the complexity of organizations, though limits to their
growth are becoming more and morc apparent. For example, the
increasing power ofcorporations in a globalizing economy has
the natural resources ofthe planet under strain.
Until recently, businesses were governed mainly by their owners,
ca-lled capitalists because tiey
provide the wealth (i.e. capital)
needed to supply the resources business organizations depend
upon for their survival. However, a different form of corporate
Sovernarce is emerging. Known as the stakeholder perspective,
this view, as afticulated by philosopher R. Edward Freeman
(195r- ), holds that anyone whose life is affected by the activities
of an organization hai a stake in that organization, and thus a
dght to influence its decisions and actions.
The term 'stakeholder' rele$ to customers, employees, and
(shareholders), but also to unions, government regulators, local
,9
.E communities, NGOS, and activists, as well as to the supplieN,
I distributors, and other partners who make up the supply chain.
A supply chain links business organizations that extract and
supply raw matedals to those that use these matedals to make
products and dist bute them to end-users. The definition of
organization expands considerably when it includes the interests
of a-ll these stakeholders.
Some believe that including all stakeholders in the definition of
organization creates a democratizing force that rcplaces
with more collaborative organizational forms (e.g. networks) and
values environrnental sustainability and social responsibiliq' as
much as profit. The movement to get companies to repoft on
soci responsibility and environmental impact as well as their
profit - collectively known as the t ple bottom line is one effect
stakeholder influence. That brand and reputation are becoming
impoftant to organizations as products and prcfitability is an
indication of the growing influence stakeholders exercise.
il, )url' Lake a dark view of capita-lism and its effects. They say that
, irt)itillism manufacturcs the need to buy in order to keep itself
.,r(i lhe gro{,th itfeeds alive. Once consurnedsm dominates a
, ! icty, they wam, it enslaves all.
I lrc argument that capitalism shifts economic activity away from
1'r,xluction and toward consumption is supported by the
, ,r,rrcrn,ies ofthe united states and western Eurcpe, whose
rr(iustries have outsourced much oftheir manulactudng activity to
rlr(. IIRIC countdes - Brazil, Russia, India, and China - generating
,r ll(\v phase of economic development. But the political systems
,rrrrl cultures ofthe BRIC countries are maikedly different from
tlrosc ofthe United States and Western Europe, and, while their
,11)romies are Srowing rapidly now, questions of stability and
..rslrinability make their long-term influence on the world and its
,,r(irnizations hard to predict. €
llris shoft history introduced some ofthe most endudng ideas
.'.,sociated with organizations: cooperation, competition, goals,
1ir', rl,th, size, complexiry, differe tiation, specialization, economy,
Il,rbalization, structure, power, institution, aDd culture. With these
r,i rs in mind, it is time to exarrrine the concept oforganizations
,rrrl its close associates, organizatiou and organizing.
lhe three Os: organization, organizations,
{ )rganizing
lr is difncult to say when humans first recognized organization as
.,I|l), but at some pointthe idea appeared as an abshactconcepi. It
rrrhcs disciplined imagination to think about organization. You can
, r1x:r'ience the discipline by challenging yourselfto make
,lislinctions between three related words we have been using
s ithotlt definition: organization, organizations, and orgalizing -
l,.t s call them the three Os.
 Organization and or€anizations are nouns, while organizing
to action and thus to a verb. Nouns name things, for exarnple
can refer to entities, states, or conditions, as they do in the terms
organizations and organization. Verbs, on the other hard, can be
iDflected to indicate past, presenl, and futur€, b nging $'ith
concern for the effects ofpassing time.
Oryanization and organizations (the two nouns) may be more
closely related than either is to organizing, but the fact that all
three build on the Greek root dpTeror, (orgazon, meaning tool)
suggests that the three Os are goiDgto be difncult to distinguish.
is wofth the effort, however, as much ofwhat we know about our
subject is built on taking one or another ofthese nuanced
distinctions as p mary. An analogy to some basic issues in
may help, since Druch organizational knowledge derives from
insight provided by the physical sciences.
The duality principle in physics states that, depending upon how
I you observe it, matter can appear as either a particle or a wave.
Something similar can be said about organizations. TakiDg the
particle view, you can locate an organization as an entiry in time
and space. The wave vierv gives you a sense oforganizations as
patterns of activiq' that recur with regularity in a wavelike
The olganizational entity known as Oxford University can l)e
fbtnd in a set ofbuildings located in Oxibrd, England, but
the wave view, its orgaDization can be seen in recurling teaching
and leaming activities, term aiter term.
The two nouns or8anizatioD and organizations are interrelated
in a circular way. When organizational activities (e.g. teaching
and learning) are repeated, like the liequencies that recur to
a wave, they come to be thought of as entities or objects. You
might call an entiq' arising from patterns of teaching and
learning an educational institution and exempli{y it using
particular organizations, like Oxford UniveNity. When you do
this conversion iD your mind, yotl make practices associated
n ith r
way ofbeing (acts of organizatio?r) into entities
,, r'ganizations) in the same way that a wave becomes a particle
l,)r physicists.
{ ,,rvelsely, you make a conversion similar to the one that turns a
t,frlicle into a wave when you consider what is oryanizational
,lx,nt a particular entity; you think about coordinated practices
llriil lead to desired end states (e.g. teaching and learning leading
1,, rrlucation). These ideas are like the two sides ofa coin; you
, .llr ot view both at the same time. but vou cannot have one
tr iILout the other.
\nother definitional challenge a ses when you compare
, ,rra nizafi.rz(s) with organizing. In physics, the Heisenberg
,rr.cftainty p nciple states that you cannot know with equal
, , rlainty a pafiicle's position and velocity; the rnore you kno\r €
.tlr)ut where it is, the less you can know about where it is going. It is
,.,Lsy to renember the uncertainty principle ifyou think about
Lr old joke in which Heisenberg gets pulled over by a policeman
policemaD gets out ofhis
" hiLe driving down the highway. The
, rrr'and walks towards Heisenberg's, motioning fbr him to lower
1r is window. The policeman says, 'Do you know how fast you
\\(,re driving, sir?'to which Heisenberg replies,'No, but I know
, rirctly where I am!'
l,ilie Heisenberg's uncefiainry principle, you can think about
,rsrnization as either outcome or process, but it is tough to think
lr)lh ways at once. You have to be present in the moment to
, rperience organiz'ing, whereas you can obserue organizarioTz(.s)
,rltcr the fact of their becorning. Yet, like the impossibiliq' of
lrowing both a padicle's position and velocil', we are likely
rrrr,er to reconcile knowledge of organizatioz(r) with that of
,,r'ganizing.
N('tice that Ijust collapsed organization aDd organizations into
rlrc composite organization(s). Otgatizatioz(s) refers to both
 Being Becoming rr'rr thc processes from which organization(s) emerge (e g'
',, l)r(xluciDg structures or'culture) or practices such as those
rl,',,,t]
! ,r)nslitute an airline (e.g. maintaining aircraft, piloting,
Organization Organization
(an entity) (the act of organizing) ,,\lr)ting passengers, and handling baggage).
Abstract
'Mosllhings mProve
'oroan zslion s an a@nq€menlol
lhngs, p€op e deas and/or a c livil es wilh mor€ o$anizaio.' llr.l0r
.t,'rirllly, managers and organizational researchers favored
,.,rlebiLsecl de{initions because these lend themselves to
.,t,til li measurement and thereby support management control'
,r'liv('
Organizalions Organizing as both organization(s) and organizing become more
(specific cases) (a process) 's,\'er,
Concrete " ,r1,[ x in the wake of globalization and technological change,
",r1)1,
becolnes increasingly important lf complexity
'lBM.lhe F€d Cross and Yourlam
'..ss knowledge
lY

rl , s it impossible to fully describe an organization or predict the

a6organi2alions

r, oDres oforganized activity with certainty, you can at least

2, Some ways think about difrercnce-s between the three Os:
'ays to think r",* your odds ofsuccess by improving organizing processes'
organizations' and organizing
on, organizai
organization'

,. lirow liom comparisons of successful irnd r.rnsuccessful

goal
lirrnizntions that lbrmulating strategic vision motivates
lr,.vrment, as does structuring roles and relationships to aid the
organizations as outcomes ot entities. They are
ion and orgi
olganization
rcomplished states of being. Organizing (including
already accomplished Dlcntation ofstrategy. Furthermore, the use oftechnolory
'l,l(
rr , nhance productivity, and cultule communicates ho\N
tltiDgs
3anization) lis an ongoing accomplishment, that is, a
acts of organization)
lbecoming Irather tban a state ofbeing.
process ofbecoming llr get done. The supportive design ofthe physical
.,rll,-
1,.,r

rr i|onment of work also cont butes to success Some of

three Os cannot substitute lbr one anoiher, the]

rgh the thre
Even though rl,r'
r' Iinowledge
Ii is based in an outcome-odcnted view, some is

are intimately related. Organizin8 proccsses give rise to acts of

ately related ,utss based, and some mixes the two.
ion that, in turn, produce organizations that elable aDa
organization
constrain fu
further olganizing processes, and so on This is the
her org It'taphors for organization
Mt'ti
reason lve: have one h basic idea (cooperating to achieve shared
goals within conpetitive environment) and three interrelated
rin a cornpe l,.tirphor is a way to stimulate imagination for new ideas'
l l,.titl
organization, organizations, and organizing: the
concepts - organizati Lrrrirgcmeltt scholar Gareth Morgan (1943- ) showed that four
three Os. r,.lirl)hors in particular have proven tlleir worth helpiDg people to
,rrrr inrages of organizatiolr: the machine, organism
(or'liviltg

nt to lbcus on
lfyou want r the outcomes ofolganizing, you can ..tlrl), culture, and psychic prison. The machine and organism
pafticular organizations - entities like Lu{thansa o
ther pafticu
speciry either r, rirl)hors came first and lend themselves best to visullizing
aDd
characteristics. such as hierarchy or division oflabor'
El Al - orr characteri! '
riirrization(s) as static structures or systems to be designed
lf you desire dl,namic understanding of organizing you must
sire a dlman ,rrtrolled either by managers or the environment The metapho$
I , rrlture and psychic prison developed later' Culturc presents
an

t0 t1