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Functionalism Revisited: A practice based Functionalism
Unformatted Document Text:  Functionalism Revisited 9 other words, the scarcity of resources results in interdependence between firms; and such scarcity is heightened by the uncertainty produced by complexity and rapid changes of firms’ environments. This, in turn, results in differentiation and specialization within the industrial population (Aldrich, 1976). In general, the theory expects that differentiation and specialization efforts augment mutual needs among organizations; and, in turn, increase the interorganizational interdependencies (Mindlin & Aldrich, 1975). Pfeffer observed that organizations attempt to absorb interdependence and uncertainty through various ways – e.g., complete merger (Pfeffer, 1972a), cooptation (Pfeffer, 1972b), and so on. RDT researchers have also explored various organization attempts to stabilize interorganizational relations ranging from “tacit collusion” to “legal contracts” (Scherer, 1970; Macaulay, 1963; both cited in Aldrich & Pfeffer, 1976). Defining interdependence as a situation in which one organization has resources or capabilities beneficial to but not possessed by the other organization, Gulati and Gargiulo (1999) argue that firms will ally with those with whom they share the greatest interdependence. Eisenhardt and Schoonhoven (1996) also found that firms under uncertain environments tend to form interorganizational alliances. From RDT perspective, a firm’s size becomes an important variable because as organizations get larger, various tasks can be consolidated and homogenized through organizational divisions and occupation. Further, size enables a firm’s administrator to use its resources to dominate other organizations in interorganizational relations (Aldrich, 1976). Gulati and Gargiulo (1999) also mention that RDT recognizes an enactment process that mediates between environmental demands and organizational action. However, they debunk this acknowledgement by arguing that the administrator under the RDT perspective is always assumed to adequately identify various sources of environmental demands and potential interorganizational partners. One of the common critics of RDT and any others based on open system theory or structuralist/functionalist viewpoint is that the general forces (environment, structural forces, system influences) determine the organizational actions and relations. That is, there is no room for individual organizations’ free will. 2 Culture (for the culturalists), (either social or economic) institution, or defined functions (functionalism) monotonously guide individuals how to behave, work, and do businesses; and individuals are internalized to abide by such influences. Also from the approaches, such explanations oftentimes become efforts of providing reasons of why the institution is as it is by making the present backward compatible. forces appear to be stronger than an individual organization’s will. Nevertheless, this is due the perspective’s epistemological stance. 2 In fact, RDT arose out of the criticism of evolutionism, which strictly posits that organizational survive is determined by natural selection-like principles (Pfeffer & Salancik, 1978).

Authors: Kim, Hyo.
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Functionalism Revisited 9
other words, the scarcity of resources results in interdependence between firms; and such scarcity is
heightened by the uncertainty produced by complexity and rapid changes of firms’ environments. This, in
turn, results in differentiation and specialization within the industrial population (Aldrich, 1976). In
general, the theory expects that differentiation and specialization efforts augment mutual needs among
organizations; and, in turn, increase the interorganizational interdependencies (Mindlin & Aldrich, 1975).
Pfeffer observed that organizations attempt to absorb interdependence and uncertainty through
various ways – e.g., complete merger (Pfeffer, 1972a), cooptation (Pfeffer, 1972b), and so on. RDT
researchers have also explored various organization attempts to stabilize interorganizational relations
ranging from “tacit collusion” to “legal contracts” (Scherer, 1970; Macaulay, 1963; both cited in Aldrich
& Pfeffer, 1976). Defining interdependence as a situation in which one organization has resources or
capabilities beneficial to but not possessed by the other organization, Gulati and Gargiulo (1999) argue
that firms will ally with those with whom they share the greatest interdependence. Eisenhardt and
Schoonhoven (1996) also found that firms under uncertain environments tend to form interorganizational
alliances. From RDT perspective, a firm’s size becomes an important variable because as organizations
get larger, various tasks can be consolidated and homogenized through organizational divisions and
occupation. Further, size enables a firm’s administrator to use its resources to dominate other
organizations in interorganizational relations (Aldrich, 1976). Gulati and Gargiulo (1999) also mention
that RDT recognizes an enactment process that mediates between environmental demands and
organizational action. However, they debunk this acknowledgement by arguing that the administrator
under the RDT perspective is always assumed to adequately identify various sources of environmental
demands and potential interorganizational partners.
One of the common critics of RDT and any others based on open system theory or
structuralist/functionalist viewpoint is that the general forces (environment, structural forces, system
influences) determine the organizational actions and relations. That is, there is no room for individual
organizations’ free will.
2
Culture (for the culturalists), (either social or economic) institution, or defined
functions (functionalism) monotonously guide individuals how to behave, work, and do businesses; and
individuals are internalized to abide by such influences. Also from the approaches, such explanations
oftentimes become efforts of providing reasons of why the institution is as it is by making the present
backward compatible.
forces appear to be stronger than an individual organization’s will. Nevertheless, this is due the
perspective’s epistemological stance.
2
In fact, RDT arose out of the criticism of evolutionism, which strictly posits that organizational survive
is determined by natural selection-like principles (Pfeffer & Salancik, 1978).


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