Introduction to Organizational Theory

Define the terms organization and entrepreneurship, and gain an understanding of both; with useful, simple examples, you'll master these concepts in no time.

Understand how value creation works, what forces in the organizational environment affect output, and how to relate these concepts with each other.

Explore how organizations increase specialization and division of labor, allow for use of technology, manage complex environments, and economize costs.

Gain an understanding of organizational theory, including how the structure, culture, and design contribute to all transactions involving an organization.

Explore how organizational design fosters the values and talents of its employees, helps businesses gain a competitive advantage, and deals with contingencies.

Measure the effectiveness of an organization using three different models: the external resource approach, internal systems approach, and technical approach.

In this business lesson, define the term stakeholder and examine common examples of stakeholders and how they participate in and benefit from an organization.

Discover how organizations deal with competing goals and allocating rewards, and how satisfying the goals of stakeholders usually involves money.

Consider the agency problem and how informational disadvantage, time, and goals play a part in the day-to-day operation of a successful, efficient organization.

Learn the basics of organizational environment, including the general and specific environments and how they directly and indirectly affect a business.

Learn about environmental complexity, dynamism, and richness, and how these factors contribute to the success or failure of a business or organization.

Explore the basics of resource dependence theory, including its definition, what it means for a resource to be scarce, and how organizations interact.

The goal of transaction cost theory is to minimize costs for exchange of resources and for management of the resources; explore its qualities and limitations.

Learn about transaction costs, including creating agreements with external trading partners and hiring internal managers to keep transaction costs low.

Gain an understanding of different organizational models that support the transaction cost theory, including the Keiretsu model, franchising, and outsourcing.