Essay on the article How Organizations Can Overbalance For my essay I read the article How Organizations Can Overbalance: Decision Overreach as a Reason for Failure by David C. Wilson, David J Hickson, and Susan Miller. This article appeared in The American Behavioral Scientist, in August 1996. In this essay I will first objectively identify the thesis and how the authors supported it, and secondly I will give a subjective interpretation of how this article affects strategic thinking, and an evaluation of this article in terms of what value it has in strategic thinking. Let us begin. The thesis that the authors used in this article was to identify what constitutes decision overreach. They concluded that there were two proponents that identified it, and they were disproportionality and irreversibility of the decision. Disproportionality was defined as “the scale of the move decided on relative to the size and scope of the organization”, especially when at least doubling the size of the activity or capacity (Wilson 999). Irreversibility is of course the inability to reverse or correct the situation. The authors also noted that both criteria must be met for decision overreach as even if the decision is disproportionate if it wasn’t irreversible they could still recover by cutting their losses, and also if it were irreversible but not disproportionate they may also be able to recover as they would have enough assets. The authors also based their arguments on two specific cases out of 55 cases that were revisited in 1990 to 1993, of which the 55 cases were a representative of one third of the 150 cases covered in the “Bradford Studies.” (Wilson 995) The two firms in which decision overreach happened were given the names of Thomson, which was a brewery, and Jacobite, an engineering factory.
Finarelli, M. (2009). Intended consequences: How changes during strategic planning can make or break a plan. Retrieved on October 10, 2011, from http://www.hss-inc.com/documents/SHSMD-MariaNovSpectrum.pdf
The major downfall and/or reorganization of companies have cost: lost securities, downsized or vacancies in employment, lost or minimized retirements, and assisted in the economic recession. The following companies have been involved in varying experiences that led to financial improprieties and unethical decisions.
Hill, C. W. L & Jones, G. R. (1998). Cases in Strategic Management (4th edition). Boston New York: Houghton Mifflin Company
Luthans, F. & Stewart, T. (1977), “A General Contingency Theory of Management”, Academy of Management Review, Vol. 2, pp. 181 – 195.
Harvard Business School case 274-116. Cooper Industries, Inc. Retrieved on August 31, 2008, from University of Phoenix, Resource, FIN/545 web site: https://mycampus.phoenix.edu/secure/resource/resource
Thompson, Arthur A., & Strickland, Alonzo J. 2003. Strategic management: concepts and cases. New York: McGraw-Hill/Irwin.
Badaracco, J. . Defining moments, when managers must choose between right and right. Harvard Business Press, print.
“Decisions must be made in good faith, must be reasonable, and must be under the belief that was made for the interest of the company; in order to be applicable.” Sometimes, miscalculations can cause irreversible damages to a company, but, we need to remember within the imperfections and errors, we can find perfection —metaphorically speaking— within a person. We cannot pretend we will build a prosperous emporium on a clean and successful path. From my perspective, I approve this rule’s policy, because, I believe that some scratches along our path, can impact positively for any company. Back in the days, many innocent people had to deteriorate their lives in a prison for a bad decision. It is impossible not to make mistakes in a company; therefore, this legal policy (BJR) gives corporate officers a relief to prove their innocence in front of a judge, and audience that will later determine if his/her actions were made in “Good Faith.” Nevertheless, if his action was delivered it on purpose, he must pay for his crime or contemplation. As an investor, I would not like to lose money, but I cannot imprison, whoever I want, because I had a negative turnover. Although, it is easier to blame somebody else, point his/her mistakes, and ignore his/her achievements in prior decisions. Consideration should be reciprocal. The business judgement rule prioritizes a common human mistake to
John G. S., 2008: Strategically thinking about the subject of Strategy [e-journal] 9(4) p.2 Available through:
An organization structure can be defined as the analytical arrangement of tasks, duties and roles and responsibilities with the aim to achieve the predetermined objectives of an organization. It also helps to coordinate among the individuals in the organization by deciding who will work under whom. This is interpersonal relation between individuals and the jobs assigned to them. Organisation structure can be classified into two categories:
Another large debate in the issues and impacts of obesity is the responsibility of employer’s. Especially for those whose obesity comes from a sedentary lifestyle. Or perhaps need the preventative measures of keeping obesity at bay. A hot topic on the rise is whether or not employers should be mandated to give employees a work-out period in their schedule. The employers could offer employee’s incentives for utilizing resources (a company gym, discounted memberships, and dietician, walking a company track) and by using the resources keep costs low. Though initially it could be costly to take on the responsibility to offer extra incentives to employee’s it could offer long term potential savings. (Villareal, Apovian, Kushner, and Klein 2005) Those whose companies offer various programs and actively engage in them express more happiness, productivity, a greater quality of life, and overall better health. Better health allows for employee’s to serve their employers better. They use less sick pay, keep insurance premiums low, and are more likely to be in tune with their daily job. So while the initial cost may be high, the long term financial gain of a happy, healthy, productive team is hard not to invest in!
Understanding the structure of an organization plays a vital role in laying the blueprint for how a company will be managed and organized. It provides a well-defined framework that outlines the roles and responsibilities of each employee in a particular company. It shows how each employee interacts and works one another in achieving the goals of a company. In other words, organizational structure is a reflection of the working relationships that govern the workflow of the company. It has a profound effect on a company’s structural dimensions, which includes formalization, specialization, hierarchy and centralization.
Psychology refers to the scientific study of human behaviour and mental processes. It revolves around how individuals think and how the mind works. Thus, it reflects to the behavioural of the person. The objective of this unit is to review the organizational psychology based on previous literatures and to discuss the scopes that it covers in the organizational Psychology. Furthermore, this unit also describes the history of the organizational psychology.
Mankins, Michael C, Steele, Richard. 2006 Stop making plans Start making decisions. Harvard Business Review. Vol 84 Issue 1, 76-84
Strategic management has shown to enhance the company’s profits and market shares. Companies need to utilize strategic management in order to improve that their performance and organizations are set. Some of the benefits of strategic management are it brings new opportunities and development, the manager is more involved in their job role, the quality of the company is enhanced, implementing models that will bring the company growth and profits, it helps the manager to be organized in order for them to be successful, it brings certainty to the company, and provides management with a guide to what the company is needing to accomplish with their goals for the future. According to Nmadu (2007) he stated “strategic management has become more important to managers in recent years and defining the mission of their organization in specific terms have made it easier for managers to give their organization a sense of purpose” (Dauda, Akingbade, and Akinlabi, 2010, p.100). Strategic management can also have its disadvantages. A few disadvantages are time and effort that is put into the company, and discussing what is important for the company’s long-term goals. Another disadvantage is managers stay on the planning stage but forget to implement and take control of the plan. If strategic management is not enforced than this can cause effects on the companies market shares, and profitability. Enforcing a strategic plan will play a major role in the companies