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1、Organizational EcologyJoel A.C. Baum and Terry L. AmburgeyRotman School of ManagementUniversity of Toronto105 St. George StreetToronto, Ontario M5S 3E6Phone: (416) 978-4914(416) 978-4063Fax: (416) 978-4629E-Mail: baummgmt.utoronto.caamburgeymgmt.utoronto.caVersion 2.0October 19, 20007,400 wordsINTRO
2、DUCTIONOrganizational ecology aims to explain how social, economic and political conditions affect the relative abundance and diversity of organizations and to account for their changing composition over time. Research in organizational ecology is grounded in three observations. First, aggregates of
3、 organizations exhibit diversity. Second organizations have difficulty devising and executing changes fast enough to meet the demands of uncertain, changing environments. And, third, organizations arise and disappear continually. Given these observations, ecological analyses formulate organizational
4、 change and variability at the population level, highlighting differential creation of new and demise of old organizations and populations with heterogeneous attributes. This formulation contrasts adaptation approaches, which explain organizational diversity in terms of ongoing organizations leaders
5、 cumulative strategic choices.Changes in organizational populations reflect the operation of four basic processes: variation, selection, retention, and competition (Aldrich 1979; Campbell 1965; McKelvey 1982). Variations result from human behavior. Any kind of change, intentional or blind, is a vari
6、ation. Individuals produce variations continuously in their efforts to adjust their behavior to others in the organization and to adjust the organizations relationship to the environment. The centrality of issues of coordination and control in organization theory is a testament to the commonness of
7、variation inside organizations. Organizational variations provide the raw material for selection processes. Some variations prove more beneficial to organizations than others in acquiring resources in a competitive environment and are thus selected positively by managers inside organizations. Simila
8、rly, investors, customers, and government regulators in the resource environment select among the variations in place among organizations competing for resources. When successful variations are known, or when environmental trends are identifiable, individuals can attempt to copy and implement these
9、successful variations in their own organization, or they can attempt to forecast, anticipate, plan, and implement policies in the context of the predictable trends. But when successful variations are unknown, because, for example, the behavior of consumers and competitors is unpredictable, the proba
10、bility of choosing the correct variation and implementing it successfully is low. Even when effective variations are identifiable, ambiguity in the causes of success may frustrate attempts at implementation and imitation. Under such conditions, variations can be viewed as experimental trials, some o
11、f which are consciously planned and some of which are accidental, some of which succeed and some of which fail. Whether or not they are known, over time, successful variations are retained as surviving organizations come to be characterized by them.If the survival odds are low for organizations with
12、 a particular variant, it does not mean that these organizations are destined to fail. Rather, it means the capacity of individuals to change their organizations successfully is of great importance. Ecological approaches do not remove individuals from responsibility for or influence over their organ
13、izations success and survival individuals do matter. Why have there been so many claims to the contrary? One important part of the confusion is that determinism is mistakenly contrasted with voluntarism rather than with probabilism. Leaving aside whether their actions are intelligent or foolish, pla
14、nned or improvised, individuals can clearly influence their organizations futures. Under conditions of uncertainty and ambiguity, however, there are severe constraints on the ability of boundedly rational individuals to consistently conceive and implement changes that improve organizational success
15、and survival chances in the face of competition. Thus, “in a world of high uncertainty, adaptive efforts . turn out to be essentially random with respect to future value” (Hannan & Freeman 1984:150).At its inception, organizational ecology focused more on differential rates of organizational failure
16、 than to differential rates of entry, largely for reasons of methodological tractability. Although this shortcoming has been largely addressed, organizational ecology is still viewed inaccurately as a theory of organizational failure. Organizational founding and failure figure prominently in organiz
17、ational ecology because they affect the relative abundance and diversity of organizations. Ecological approaches to organizational founding and failure constitute a radical departure from approaches to entrepreneurship and business failure, which focused primarily on individual initiative, skills, a
18、nd abilities. By concentrating on the traits of entrepreneurs and managers, these approaches deflect attention away from the volatile nature of organizational populations. Ecological approaches, by comparison, emphasize contextual causes that produce variations in organizational founding and failure
19、 rates over time by influencing opportunity structures that confront potential organizational founders and resource constraints that face existing organizations. The focus of organizational ecology research continues to change rapidly, however, as researchers turn their attention to processes of org
20、anization-level change and tests of structural inertia theory, revealing the role of organization-level change for understanding what organizations do as individuals, populations, and communities. LITERATURE REVIEWIn broad terms, theory and research in organizational ecology focuses on two themes su
21、mmarized in Table 1: demographic processes and ecological processes.Insert Table 1 about here.Demographic ProcessesWhereas founding processes are typically conceived as attributes of a population since no organization exists prior to founding, change and failure processes occur at organizational and
22、 population levels existing organizations have histories and structures that influence their rates of change and failure. Studying organizational failure and change is thus complicated by the need to consider processes at both levels. Demographic analysis examines the effects of organization-level c
23、haracteristics on rates of organizational change and failure.Age and Size DependenceA central line of inquiry in demographic processes is the effect of organizational aging on failure. Until recently, the predominant view was the liability of newness (Stinchcombe 1965), which proposes that, because
24、they have to learn new social roles, create new organizational routines, and lack endorsements and exchange relationships at a time when resources are stretched to the limit, young organizations will have higher failure rates. A complementary viewpoint is that selection processes favor structurally
25、inert organizations capable of demonstrating reliability and accountability, which requires high reproducibility. Since reproducibility, achieved through institutionalization and routinization, increases with age, older organizations should be less likely to fail (Hannan & Freeman 1984).A related li
26、ne of research examines how organizational size influences failure. Small organizations propensity to fail results from several liabilities of smallness, including problems raising capital, recruiting and training a workforce, paying higher interest rates and handling costs of regulatory compliance
27、(Aldrich & Auster 1986). Moreover, as organizations grow, they increasingly emphasize predictability, formalization and control, demonstrating greater reliability and accountability and consequently less vulnerability to failure. The significance of the liability of smallness stems in part from its
28、relation to the liability of newness: Since new organizations tend to be small, if small organizations have higher failure rates, empirical evidence of a liability of newness may actually reflect specification error. With few exceptions, studies support the liability of smallness prediction that org
29、anizational failure rates decline with increased size. In contrast, however, although early studies consistently found a liability of newness, more recent studies controlling for time-varying size generally do not, and this has prompted formulation of alternative theoretical perspectives on age depe
30、ndence.The liability of adolescence (Fichman & Levinthal 1991) predicts a -shaped relationship between age and failure. New organizations begin with a stock of assets (e.g., goodwill, positive beliefs, commitment, resources) that buffers them during an initial honeymoon period even if early outcomes
31、 are unfavorable. The larger the initial stock, the longer the organization is buffered. As initial endowments are depleted organizations unable to meet ongoing resource needs because, for example, they are unable to establish effective routines or stable exchange relations, are increasingly likely
32、to fail.Liabilities of newness and adolescence provide divergent accounts of age dependence for young organizations, but both imply a monotonic decline in failure for older organizations. Yet, processes underlying these models occur early in organizational lifetimes and have limited implications for
33、 older organizations. The liability of aging (Baum 1989; Barron et al. 1994; Ranger-Moore 1997) identifies processes affecting older organizations and predicts that failure increases with aging. The liability of aging begins with another insight from Stinchcombes essay: “. the organizational inventi
34、ons that can be made at a time in history depend on the social technology available at that time” (1965:153). Organizations reflect their founding environment. As environments change, however, bounded rationality and structural inertia make it difficult for individuals to keep their organizations al
35、igned with environmental demands. Encountering a series of environmental changes may thus expose aging organizations to a risk of obsolescence. Aging may also bring about senescence: an accumulation of internal friction, precedent and political pacts that impede action and reliable performance, lowe
36、ring organizational performance - and survival chances - even in a stable environment. Obsolescence and senescence pose separate risks: senescence is a direct effect of aging; obsolescence a result of environmental change.Ranger-Moore (1997) recently examined age dependence in an archival, event his
37、tory study of 154 New York life insurance companies during 1813-1985. First, he attempted to show the sensitivity of age dependence in organizational failure to the inclusion of time-varying measures of organizational size. Second, he examined patterns of age dependence of life insurance companies f
38、or evidence of senescence and obsolescence. Based on the conceptual distinction between these processes, he suggested that positive age dependence in failure rates reflects a liability of senescence in a stable environment, whereas in a turbulent environment positive age-dependence greater than that
39、 in stable environments reflects combined liabilities of senescence and obsolescence. To test these ideas, Ranger-Moore compared estimates of age dependence across several, more or less stable, historical periods. Results supported global hypotheses for size and age, showing age dependence to be sen
40、sitive to inclusion of time-varying size and in particular that a spurious liability of newness appeared without size controlled. However, the liability of aging exhibited by life insurance companies (after controlling for size) suggested only a liability of obsolescence; there was no liability of a
41、ging during stable historical periods.More generally, divergent age dependence results might reflect variation in age dependence across populations or subpopulations (Baum 1996). In this view, newness, adolescence and obsolescence are complementary rather than competing models, only one of which is
42、correct. To address this possibility research must test alternative age dependence models mediating variables directly rather than using age as a surrogate for all underlying constructs. Henderson (1999) recently conducted such a study in which he hypothesized contingent age dependence effects depen
43、dent on an organizations technology strategy. Proprietary strategists explore new technologies by engaging in search, variation and experimentation; the growth potential is large but so is the risk of failure. Standards strategists emphasize the refinement of existing technologies, forgoing future g
44、rowth opportunities for risk reduction. Proprietary strategists take longer to develop a stable and reproducible set of organizational routines and capabilities and may also experience lower legitimacy than standards strategists. This, coupled with lower initial growth, should produce more initial f
45、ailure of proprietary strategists. Moreover, proprietary strategists reliance on internal technology makes adaptation to external changes difficult. Standards strategists, in contrast, should readily absorb external innovations, particularly from other standards strategists. Hendersons partial adjus
46、tment models of sales growth and event history models of failure among 649 U.S. personal computer manufacturers during 1975-92 provided strong support for his contingency view. One exception was that proprietary strategists did not exhibit a liability of newness. Hendersons results demonstrate how m
47、ultiple patterns of age dependence can operate simultaneously in a single population. His study also reveals important tradeoffs between growth and the risk of failure resulting from the joint effects of age and strategy.Organizational ChangeMost research on organizational change concentrates on con
48、tent: A change to a more (less) advantageous configuration is considered adaptive (detrimental) (Amburgey et al. 1993). Complementing this focus, structural inertia theory (Hannan & Freeman 1984) emphasizes change process. While content effects of change center on the difference between the performa
49、nce consequences of organizational attributes before and after change, process effects focus on disruptions to internal routines and external exchange relationships. Structural inertia theory raises two questions.How Changeable are Organizations? The structure in structural inertia theory refers only to core organizational features (goals, forms of authority, core technology and market strategy) related t
