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Functionalism Revisited: A practice based Functionalism
Unformatted Document Text:  Functionalism Revisited 8 with its manufacturer. However, setting up computer network channels, such information would directly go into the manufacturers’ database system. Since the possible risk of asset specificity was reduced, the firm becomes favorable toward seeking out partners rather than setting up distribution branches. IT provides an incentive to reduce the other parties’ asset specificity, which was not originally addressed in TCE and PAT. Therefore, using the NIE approaches alone would not resolve the complexity of the economic world. Gulati and Gargiulo (1999) pointed out that rather than thoroughly designed organizational structures, it is the social mechanisms among the members of social network eventually reduce behavioral opportunism. Their rationale convincingly suggests that behavioral uncertainties would be reduced through the social bonds; however, it is not clear how it works under environmental uncertainties. Functionalism/Structuralism Viewpoints The second group concerns the environmental influences on individuals or organizations – structuralism or functionalism. Perspectives of this approach generally assume systematic influences on individual (organizational) actions. Open System Theory (Katz & Kahn, 1978). RDT, Population Ecology, Institutional Theory, in general, belong to this group. Traditionally, the approach has been the most accessible to organizational study researchers. Resource Dependence Theory RDT assumes that organizations are not able to produce all the required resources internally, and therefore must enter into transactions and relations with others (Aldrich & Pfeffer, 1976), which defines interdependencies among relative organizations. Pfeffer describes that “[interorganizational] relations can be understood as a product of patterns of interorganizational dependence and constraint” (1987). Blau (1990) argues that defined by differentiation and interorganizational division of labor, some forms of interdependencies are strategically sought or avoided by administrators. Such strategies include vertical integration, horizontal mergers, and so on. These interdependencies and other external elements (policies, for example) constitute organizational environments. The environments, in turn, influence the organizations as constraints and conditions. Organizational managers strategically maneuver through the known and unknown contexts of environments – i.e., uncertainty (Aldrich & Pfeffer, 1976, p.84). 1 In 1 Aldrich and Pfeffer (1976) emphasize the notion of maneuver because it gives room for organizational free will. Such emphasis is made in response to the criticism arguing that organizations (their lifespan, relations, and so on) are solely under the control of environmental factors. Pfeffer’s note (1978) on RDT also remarkably emphasizes the individual organization’s ability to handle uncertainties by contrasting RDT to the evolutionism. Still, however, in comparison to the perspective of structuration, the general

Authors: Kim, Hyo.
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Functionalism Revisited 8
with its manufacturer. However, setting up computer network channels, such information would directly
go into the manufacturers’ database system. Since the possible risk of asset specificity was reduced, the
firm becomes favorable toward seeking out partners rather than setting up distribution branches. IT
provides an incentive to reduce the other parties’ asset specificity, which was not originally addressed in
TCE and PAT. Therefore, using the NIE approaches alone would not resolve the complexity of the
economic world.
Gulati and Gargiulo (1999) pointed out that rather than thoroughly designed organizational
structures, it is the social mechanisms among the members of social network eventually reduce
behavioral opportunism. Their rationale convincingly suggests that behavioral uncertainties would be
reduced through the social bonds; however, it is not clear how it works under environmental uncertainties.
Functionalism/Structuralism Viewpoints
The second group concerns the environmental influences on individuals or organizations –
structuralism or functionalism. Perspectives of this approach generally assume systematic influences on
individual (organizational) actions. Open System Theory (Katz & Kahn, 1978). RDT, Population
Ecology, Institutional Theory, in general, belong to this group. Traditionally, the approach has been the
most accessible to organizational study researchers.
Resource Dependence Theory
RDT assumes that organizations are not able to produce all the required resources internally, and
therefore must enter into transactions and relations with others (Aldrich & Pfeffer, 1976), which defines
interdependencies among relative organizations. Pfeffer describes that “[interorganizational] relations
can be understood as a product of patterns of interorganizational dependence and constraint” (1987).
Blau (1990) argues that defined by differentiation and interorganizational division of labor, some forms
of interdependencies are strategically sought or avoided by administrators. Such strategies include
vertical integration, horizontal mergers, and so on. These interdependencies and other external elements
(policies, for example) constitute organizational environments. The environments, in turn, influence the
organizations as constraints and conditions. Organizational managers strategically maneuver through the
known and unknown contexts of environments – i.e., uncertainty (Aldrich & Pfeffer, 1976, p.84).
1
In
1
Aldrich and Pfeffer (1976) emphasize the notion of maneuver because it gives room for organizational
free will. Such emphasis is made in response to the criticism arguing that organizations (their lifespan,
relations, and so on) are solely under the control of environmental factors. Pfeffer’s note (1978) on RDT
also remarkably emphasizes the individual organization’s ability to handle uncertainties by contrasting
RDT to the evolutionism. Still, however, in comparison to the perspective of structuration, the general


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