The impact of various changes in an organization has both positive and negative effects on the organization structure and functioning. Some of the variables or characteristics of an organization include the following factors: Cultural, Technological, Economical, Political, Legal, Natural resources, Demographic, Sociological and Educational factors.
The impact of culture in an organization develops to help the organization cope with its environment. Today many organizational leaders confront many challenges relating with cultural issues of the society. Some of these issues include the ideologies, values and behavioural norms of the society. Shared ideologies in the society consist of two components: substance-the network of meaning associated with ideologies, norms and values or forms-the practice whereby the meanings are expressed, affirmed, and communicated to members of an organization. Culture is an important tool for analyzing and evaluating the organization cultural change strategies that leaders can employ to improve organizational performance. (Trice and Beyer, 1984).
The impact of technology in an organizational can be assessed by the rate and degree of technological advancement. In recent times technology has been advancing at a faster rate. This rapid change in technology has resulted in ultimate changes in an organization. Many organizations have resulted to use of modern technologies in order to cope up with the current changes of the modern world. Globalization is one the main technological advancement in the world today. This has made the spread of information so fast hence information technology of the organization.
Political nature of any organization is an important factor. The influence of politics on an organization depends on the political maturity of the society.
The political factors of an organization include in general the legal issues and matters pertaining to government regulations which in it give both the formal informal rules which an organization can operate. Some examples include political ideologies, policies or laws governing the organization, Environmental climate and the Political stability. The political will of any organization determines its success. (Harkness et al, 2003)
The economic factors of the organization will consequently affect ability of the organization to sustain itself economically.Economic framework, structure, fiscal policies, growth phase are among the economical factors that have impact into an organization. The growth rate of an economy depends on the countries economic growth and the income capital of an organization. The economic framework includes things like the interest rates, exchange rates and the inflation rate within the country. The fiscal policies depend on the tax rates of an organization. (Harkness et al, 2003).
Generally legal issues of an organization depend on the political will of that organization. Characteristics of organizational legal issues determine its success and prosperity. The rate and nature of legislative changes are important tools to measure the organization’s prosperity in terms of legal issues. Legal changes must be suitable to organizational needs and achievement. Legal experts are important people to guide an organization management on legal affairs. Organizational legal affairs should not be too harsh to the members as this affect the morel of the members.
This refers to the number, structure and distribution of the population. The demography of an organization is governed by demographic policy goals, the size of the population and the net flow for the system as a whole. Demographic structure is an important factor in determining organizational prosperity. An organization with well structured demographies excels faster than those with complex structures. The policy is the basic factor for demography.
These are resources given by nature; they include land, forests, and minerals. They form the basic source of capital for an organization. They also include the climate which affects the environment of the organization.
This includes tribal or class structure, social roles and institutions. An organization should have well established sociological systems. Social classes arise due to difference in education leading to educational classes or due to social factors like drinking or smoking
Education within an organization refers to the level of education among the members. A highly educated organization tends to develop faster then illiterate organization. Organization that educates its members develop faster, as education is the key to development.
Specific environmental variables of organization
The specific environmental variables of organizations include: Customers, Suppliers, Competitors, Socio-political and Technological.
Customers are the final users of a commodity. Their involvement in an organization is seen as a strategy and tactic to increase the sales of a product. Customers have different expertise they therefore they should be considered in an organization especially when a new product need to be introduced into the market. The cost involved in customers side will call for reward and these costs could also influence on other customers. An organization which strives to succeed in marketing its products must understand the customers’ behaviour and also better planning of customer involvement from the supplier’s side. (Brockoff, 2003).
They avail the resource to the market ready for purchase by the customer or the buyers. Their role is to ensure that they avail product for sale. They are important group of people as they are the link between the producer and the consumer. They supply both the capital and the labour. The capital include the liquid assets and the labour is the human workforce. The capital is a basic necessity of the organization as it determines the organization ability to compete with other organization. The labour gives the workforce that transports the material to the market using various mode of transportation.
These are the competitors of the organization in terms of resource. Competition for resources occurs among many organizations today. It removes the culture of monopolistic market. Potential competitor has been seen as a mechanism to control the exploitation of market power. Various models to study competition have been developed by several researchers to measure the competition. In order to survive in competition the organization should use tactical ways to overcome their competitors.
The social political nature of the organization includes the social attitudes and the regulations. The social attitude of an organization towards its customers is an important component to observe. Organizations with complex regulations scare away potential consumers or buyers.
Technological factors have the ability to reduce barriers to entry, minimum efficient production levels and also ability to affect outsourcing decisions. These technological factors do include: Automation, technology incentives and rate of technology change. Technology can affect the product, service and the industry itself. Use of new technologies increases the quality of the product. Technology also increases the speed of services and improved industrial processing of the products
Major subsystems of an organization
Organization sometimes becomes large enough that the management cannot afford to manage it. In such cases many organizations resorts to decentralization of the management creating small systems or subsystems. These subsystems of the organization can deal with specific process only. The function of this creation of the subsystem is to improve service delivery to its customers. They are strategic sub sectors of the organization. Some of these subsystems include technological, cultural, political subsystems among others.
Brockoff, K. (2003); Customers perspective of involvement in new product development; International journal of technology management, vol 26, no 5/6.. Web.
Harkness, J.A, Fons J.R. Van de V, and Peter P. (2003);Cross-Cultural Survey Methods, Journal of marketing, vol 4. Web.
Trice, H and Beyer, J. (1984); Studying organizational cultures through rites and ceremonials. Academy of management journal. Vol.9 no. 4. Web.