• 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.

The Corporation and Risk
The corporation and risk

In Chapters 3 and 4, we focused on factors external to the organization that affect organizational risk. Now we want to examine factors internal to the organization that affect organizational risk. We focus on the large corporation because it is in this type of firm that the issues being discussed are seen most strongly. Large corporations are typically diversified and divisionalized. The multiple divisions in such corporations constitute a portfolio, in that the performances of these divisions interact to affect the overall corporate performance. Thus the concepts of risk and portfolio effects can be applied within the corporation. Moreover, debt and divestment are other frequently found features of the large diversified, divisionalized corporation that affect the organizational portfolio. ...

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