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Posted on September 20th, 2012, by

Contemporary organizations often face a number of challenges provoked by internal and external problems, and challenges concerning the formation of the positive organizational culture. The understanding of the essence of functioning of modern organizations and basic principles of interpersonal relationships within organizations can be crucial for the effective management of organizations and the improvement of their performance. In this respect, it should be said that there are a variety of theories and approaches to the management of organizations, which can help to overcome possible challenges and prevent the emergence of internal problems within the organization as well as to minimize external threats and risks. To meet this goal, it is necessary to focus on the analysis of recent studies dedicated to the problem of the organizational theories and challenges. At this point, it is possible to refer to the articles “Organizational Effectiveness: A Multiple-Constituency Approach”¯ by T. Connoly, E.J. Conlon and S.J. Deutsch, “The Stakeholder Theory of the Corporation: Concepts, Evidence and Implications”¯ by T. Donaldson and L.E. Preston, and “Management Challenges in a New Time”¯ by H.G. Barkema,Ā  J.C. Baum and E.A. Mannix.

On analyzing the article “Organizational Effectiveness: A Multiple-Constituency Approach”¯ by T. Connoly, E.J. Conlon and S.J. Deutsch, it should be pointed out that the authors apparently attempted to conduct a large scale research revealing the essence of the Multiple-Constituency Approach. The authors stand on the ground that, in the contemporary business environment, the Multiple-Constituency Approach is the most effective approach to the management of modern organizations. They begin their article with the criticism of the existing approach. It should be pointed out that they are very skeptical of the effectiveness and reliability of existing theories, because, as the authors points out, all of the modern organizational theories have one and the same substantial flaw ”“ they attempt to identify a single effectiveness statement which is common to all organizations and, therefore, can be applied to all organizations (Connoly, Conlon and Deutsch). At this point, it is important to underline that the researchers tend to generalization of existing theories. What is meant here is the fact that it is hardly possible to estimate that absolutely all of the existing organizational theories have the problem of a single effectiveness statement. In actuality, it is obvious that there are no identical organizational theories and, whatever the position of the authors of the article is, these theories differ. They can hardly be unified on the basis of their natural strife for an effectiveness statement. Moreover, the article contains certain controversy in regard to the Multiple-Constituency approach in comparison to other serious. This controversy is the paradoxical denial of all organizational theories by the authors on the presumption of their exaggerated concern with the effectiveness statement, while their positive view of the Multiple-Constituency approach also implies that the use of this approach is supposed to make the performance of organizations more effective, through understanding of specific needs of each organization in particular. In other words, the overall outcome of their research can be associated with the effectiveness statement, which authors criticized severely when they found it in other theories. The research is based on the Multiple-Constituency theory and enlarges existing knowledge of organizational theories.

In fact, the paper supports the correctness of the Multiple-Constituency theory, while all other theories are rejected or ignored by the researchers. This is a serious weakness of the article because the authors present a one-sided view on organizational theories. On the other hand, its strength is the in-depth research of the Multiple-Constituency approach.

Nevertheless, the authors’ research is convincing because their theoretical assumptions are backed up with empirical evidences. The authors refer to the experience of existing organizations and analyze their organizational structure and performance to show that all the organizations are different and unique in a way. In such a context, the conclusion of the researchers that, due to the diversity and uniqueness of all organizations, it is necessary to apply the Multiple-Constituency approach seems to be quite logical and convincing. On the other hand, the article still seems to overemphasize the significance of this approach and the denial of all other organizational theories is apparently inconsistent, because, using the logic of the authors, the diverse business environment and organizations cannot be fully described with the help of one approach only, because it can fail to take into consideration nuances present in other theoretical approaches.

At the same time, the authors pay a lot of attention to the literature dedicated to organization theories, but their view on other theories is a bit one-sided and quite subjective. In such a way, the researchers enlarge theoretical views on the organizational functioning and performance.

As for “The Stakeholder Theory of the Corporation: Concepts, Evidence and Implications”¯ by T. Donaldson and L.E. Preston, it should be said that the authors of the article are mainly concerned with the Stakeholder theory of the corporation, which is in the focus of their research. In fact, the authors pay a particular attention to the research of the literature dedicated to the Stakeholder theory and they conducted a profound literature analysis revealing the fact that this theory is quite effective and reliable. To put it more precisely, among major strengths of the theory, the authors single out its descriptive accuracy, instrumental power and normative validity (Donaldson and Preston). Unlike the authors of the previous article, who paid a lot of attention to the analysis and criticism of other organizational theories, T. Donaldson and L.E. Preston mainly focus their attention on the Stakeholder theory solely that apparently deprives their research of some convincing power. What is meant here is the fact that the authors attempt to explain the essence of the Stakeholder theory, reveals its major advantages and strengths, but they actually fail to compare this theory to other organizational theories. As a result, a reader can naturally wonder whether this theory is really as good as the authors attempt to present it, or probably there are other reliable and solid theories. In other words, there is a lack of comparison in the research conducted by T. Donaldson and L.E. Preston.

On the other hand, they analyze in details the Stakeholder theory. At first they reveal the essence of this theory defining the fundamental concepts. Then they reveal its practical applications and clearly state strengths of this theory and its applicability to the contemporary organizations. In addition, their research is grounded not only on empirical evidence but also on other researches conducted in regard to the Stakeholder theory.

The research is focused on the Stakeholder theory. The theory is analyzed in the context of other organizational theories that reveals the strength of the article since it is focused on the detailed research of various organizational theories providing a diverse view on the organizational performance and essence. At the same time, the paper lacks empiric evidences that may be viewed as a weakness of the research. Nevertheless, researchers managed to reveal in details the Stakeholder theory and grounded its significance for understanding of organizational performance. In such a way, the researchers enlarged scientific interpretation of functioning and essence of organizations.

Finally, speaking about “Management Challenges in a New Time”¯ by H.G. Barkema,Ā  J.C. Baum and E.A. Mannix, it should be said that the authors shift the emphasis from organization theories to the major challenges modern organizations faces in the contemporary business environment. To put it more precisely, they argue that the modern world has changed dramatically and, what is more important, it keeps changing constantly. Modern organizations have to deal with new challenges they have never faced before. In this respect, the authors point out a significant impact of the globalization on the development of modern organizations (Barkema, Baum and Mannix). In addition, they point out that the huge technological leap of recent years has produced a huge impact on the development of modern organization and changed consistently the interpersonal relationships within organizations (Barkema, Baum and Mannix). The authors single out the major challenge modern organization need to cope with in order to succeed and perform effectively. This challenge is the adaptability and flexibility of the organization (Barkema, Baum and Mannix). What is meant here is the fact that modern organizations need to develop fast.

They need to adapt new technologies, new management approaches and be able to respond to the changing business environment as fast as possible.

In fact, researchers mainly refer to the empirical studies and the research lacks, in a way, a strong theoretical ground. On the other hand, such a lack of the theoretical backup is quite normal, into consideration the fact that the researchers deal with current trends and even to forecast the future development of organizations. At the same time, they amply refer to other studies conducted by other researches to prove that their position is correct.

The researchers avoided the focus on a specific theoretical background. Instead, they focused their attention on major challenges modern organizations are facing. The lack of theoretical background is the major flaw of the article because there is no theoretical backbone nor alternatives supporting the position of the researchers from the theoretical point of view. Nevertheless, the article contributes to the better understanding of problems of modern organizations that helps to develop organizational theories, which traditionally aim at the solution of organizational problems.

Thus, in conclusion, it should be said that modern organizational theories and challenges are diverse. In spite of efforts of researchers discussed above to convince the audience that some researchers are more reliable than others, it is hardly possible to single out only one, universal theory. As for challenges, modern organizations face, this problem needs further researcher and challenges are likely to evolve along with organizations.

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