Organizations and Networks
ORGANIZATIONS ARE SOCIAL structures designed to get things done through the cooperation of individuals. Organizations face four related challenges: first, motivating people to do what the organization wants them to do; second, deciding what should be done; third, accomplishing what needs to be done; and fourth, acquiring the needed resources. Additionally, the borders of an organization are not necessarily clear, and organizations have numerous stakeholders who must be placated and/or convinced to cooperate. All of these challenges involve utilizing a chain of authority or command to force people to perform—in other words, networks. While deciding what to do may involve individual creativity, most ideas are not original and come from others and the cultural milieu. Organizations use internal and external networks to develop ideas that help them decide what to make and/or what services to provide and how to do it. Networks help raise capital to provide organizations with resources. While the emphasis in this chapter is on for profit organizations, the issues of authority, clients, capital, and outcomes are common to public sector and governmental organizations as well, though they are often cast in different terms.
A formal organization consists of a designed chain of authority. A number of books describe the process for creating organizational structures (Mintzberg 1979).1 But as we learned from the previous chapter on small groups, all formal or external systems breed informal networks that are grafted onto them. By way of the motivations of safety, effectance, and status achievement, the informal networks develop leaders that match the norms and culture of the informal network, and these may or may not match the norms and culture of the host organization. Further, modern organizations