• Summary
  • Contents
  • Subject index

In this book, Lex Donaldson, one of the leading scholars in the field of organization theory, introduces a compelling theory of performance-driven organizational change, Organizational Portfolio Theory. In explaining why organizations change and also why they fail to change, the theory reconceptualizes the organization as a portfolio with a number of different causes of organizational performance varying over time. The author argues that without a performance crisis there is a good chance that necessary organizational changes will not be forthcoming, and that moreover, the adaptive change induced by the crisis creates the capacity for fresh organizational growth.

Adaptation Confounds
Adaptation confounds

Organizational adaptations are intended to be beneficial but sometimes appear not to be. In this chapter, we consider organizational adaptation and show why the usual expectation about its benefits often fails to hold. Organizational portfolio theory reveals adaptation effects to be more subtle than supposed under existing theory. The chapter develops an analysis of how adaptation relates to organizational performance. The role of other factors that affect organizational performance is revealed to be crucial. These other factors often confound the benefits that flow from adaptation, leading to false conclusions that many organizational changes are in fact not adaptive.

In previous chapters, we discussed adaptations—that is, changes to organizational structure and the like—as being caused by low performance. By definition an adaptation is something ...

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