Jeffrey Pepper

Jeffrey Pfeffer (born July 23, 1946 in St. Louis , Missouri ) is an American economist and since 1979 professor of organizational theory at the Graduate School of Business at Stanford University .

Life

Pfeffer studied business administration at Carnegie-Mellon University from 1964 to 1968. He then did his doctorate with a focus on organizational theory at Stanford.

1971–73 he was employed on the faculties of the business schools of the University of Illinois and 1973–1979 at the University of California, Berkeley . From 1979 to 81 Pfeffer worked at the Graduate School of Business at Stanford. From 1981 to 1982 he was visiting professor for the Thomas Henry Carroll-Ford Foundation for business administration at Harvard Business School . In 2006 Pfeffer was visiting professor at the London Business School , Singapore Management University and at the IESE Business School in Barcelona, ​​which is part of the University of Navarra , Spain .

From 1994 to 1996 he was Director of Executive Education responsible for the management training programs at Stanford Business School . He also works as a management consultant , speaker and has been appointed to the supervisory boards of various companies.

job

Resource dependency

In collaboration with Gerald R. Salancik, Pfeffer promoted the idea of ​​understanding companies in terms of their interactions with the environment at an early stage. This results in a resource-based approach , in contrast to the market structure approach as represented by Michael Porter .

How strong the dependency on a resource is is determined by the behavior of organizations . For example, if the job satisfaction of the employees of a fast food chain is low, this may affect the organization. It may not matter because the labor market is full of young, unskilled workers who can quickly replace the existing workforce. In addition, the organization would be at a competitive disadvantage if it invested more money in the workforce.

The resource dependence of organizations also means that they cannot be controlled autonomously, but have a conflict of interest with others who control these resources . The strength of the dependency is determined by three factors:

The importance of the resource for the organization, determined by the relative share that the resource has in the input and output of the organization, which in turn depends on the importance of the resource for an organization. In other words, what would the effect be on the organization if the resource were missing? The second question is, “How independent is whoever controls the resource?” Complete independence means unrestricted access and freedom of choice in distribution. An organization that is dependent on the resource can be put under considerable pressure. The third question assesses the extent to which the controlling entity has a monopoly over the resource. Can the dependent organization find an alternative supplier or substitute for the resource?

Given the multitude of dependencies, an organization must find a balance between the various dependencies. Pfeffer and Salancik suggest four possible strategies:

• Adjust or change the restrictions
• Change of mutual dependencies through mergers , diversification , or growth
• Influence over one's environment through supervisory board members in both organizations, joint ventures with other organizations or through other association activities
• Changing the legal situation of the environment with political activities

Conversely, as Pfeffer and Salancik argue, the environment influences the decision-making process of an organization when it comes to appointing the company management (chairman of the board, managing director, CEO). They give a three-step causal chain for the replacement of the company management. The first stage involves changes in the environment, giving power to the department that is best able to deal with the change. However, this gain in power only takes place if the performance cannot be replaced and affects large parts of the organization.

In Pfeffer and Salancik's opinion, the resulting power situation influences company succession . There is a tendency to blacken the lead for poor results, as it were to counterbalance the lead's tendency to boast good results. So when the situation is particularly bad, the line is often replaced.

In the third stage, appointed managers are again able to influence the strategy . Even if they do not have absolute power of disposal, they can influence the strategic direction. In addition, the change of managers from one business area to another enables coordination of activities through mutual trust.

Management and human resources as a competitive advantage

Based on the results of the most profitable US companies from 1972 to 1992, Pfeffer developed a counter-statement to the "classic" view of competitive advantages . The most profitable companies during this period were

Companies	Industry / activities	Disbursed profit
Plenary Publishing	Magazines, book printing	15.689%
Circuit City	Household electronics and kitchen appliance trade	16.410%
Tyson Foods	Producer of poultry	18.118%
Wal-Mart	Discount stores	19.807%
Southwest Airlines	Low-cost airlines	21.775%

All of these companies operate in industries that are based on the classic and currently taught management theory such as industry structure analysis , strategies of the competitive matrix and the like. Ä. are not attractive. In order for companies in these sectors to be able to operate more profitably than companies in attractive industries , they have to be different from these and their direct competitors.

Pfeffer sees this essential difference in the way people are used in the production process. The fact that these companies have produced these results over 20 years proves that it is not an easily copied skill. Pfeffer describes how to do this in three steps

step	activity	Explanation
1	building up trust	Treat people with respect and dignity. This also means that the values ​​of the corporate culture are observed.
2	Stimulate change	Change has to be communicated and conveyed through all possible means, work design, job description, even the layout of the offices.
3	Concentrate on the essentials	Most metric systems provide endless data about the past, but little about the present or the reasons for current performance.

The task of the leader in such scenarios is to build adapted organizations that are able to cope with the turbulent environment. Much like Warren Bennis , Pfeffer sees a difference between manager and leader.

Works

1. The External Control of Organizations: A Resource Dependence Perspective
2. Organizational Design, Harper & Row (together with GR Salancik)
3. Power in Organizations
4. Organizations and Organization Theory
5. Managing with Power: Politics and Influence in Organizations
6. Competitive Advantage Through People: Unleashing the Power of the Work Force
7. New Directions for Organization Theory: Problems and Prospects
8. The Human Equation: Building Profits by Putting People First
9. The Knowing-Doing Gap: How Smart Companies Turn Knowledge into Action
10. Hidden Value: How Great Companies Achieve Extraordinary Results with Ordinary People
11. Hard Facts, Dangerous Half-Truths, and Total Nonsense: Profiting from Evidence-Based Management

Web links

• Homepage at Stanford University (English)

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1. ↑ Website ( short vita ( memento of the original from October 16, 2006 in the Internet Archive ) Info: The archive link has been inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. ) From Earlybird via the Supervisory Board ( Advisory board) 
2. ^ Derek S. Pugh & David J. Hickson (1996) Writers on Organization, Penguin Books, London
3. ↑ David J. Hickson and Bob Hinings with the contingency theory of intra-organizational power, based on the results of the Aston Group
4. ↑ Jeffrey Pfeffer Competitive Advantage through People in Jane Henry and David Mayle (2002) Managing Innovation and Change, Sage Publications, London; ISBN 0-7492-3900-X
5. ↑ Investment winners and losers , Money, October 1992, 133
6. ↑ Jeffrey Pfeffer The Human Equation , Harvard Business School Press, Boston 1998