Organization Theory

Historical Development

The design and management of specific types of organizations have been practiced for several thousands of years and studied for a couple of centuries. Nevertheless, generalizations about organizations and the development of organization theory as an academic field are restricted to the post–World War II period. The actual phrase organization theory was most actively promoted by Herbert Simon from 1950 onward, being seen as a broad category that included many existing approaches, such as scientific management and industrial psychology. However, while organizations in these approaches were primarily seen as settings within which work was carried out, they were now seen as units of interest in their own right and analyzed as distinctive social systems and collective actors.

In what has retrospectively become known as classical organization theory, the emphasis was on universal principles of administration and management that could lead to goal achievement. While produced about a hundred years ago, elements of contributions from people such as Frederick Taylor on scientific management, Herbert Fayol on administrative theory, and Max Weber on the theory of bureaucracy are still evident in today's organizations. However, since the 1950s, this rational- and closed-systems perspective on organizations has been supplemented by other types of perspectives. While classical organization theory indicated that there is one best way of organizational design and practice, contingency theory from the 1960s onward suggests that this depends on the characteristics of each situation. Thus, according to this kind of rational- and open-systems perspective, variations in the environments, tasks, and technologies of organizations [Page 1748]imply variations in organizational forms and processes.

The human relations approach from the 1930s onward represented a natural-systems perspective, where the emphasis was not primarily on achieving goals but on organizational survival. Here, too, since the 1960s, characteristics of the environments of organizations have become increasingly important, representing a turn from closed-to open-systems perspectives. Moreover, in this latest period, social constructionist approaches have become more prominent. According to these approaches, the organization and its forms and processes do not exist as objects separate from people but are created and maintained as organizational members talk about what they think is happening and what needs to be done. Recently, postmodern approaches have also become popular among some organizational researchers; for example, in the study of language games and discourses involving organizations and organizing.

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