Population Ecology Approach

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The population ecology approach is a term from organizational sociology . It is similar to the synthetic evolutionary theory of biology originally developed by Charles Darwin . Due to the constant further development of the population and because each individual is subjected to a selection , the chances of survival of the populations adapted to the dynamic environment increase, while the chances of survival of the "weaker" decrease.

Here it is explained how this theory was further developed for the economy and how it was applied to companies as an organizational evolution theory . The population ecology approach was mainly applied and further developed in the USA, whereas in Germany the theory of evolutionary management was mainly discussed.

Main representatives and major works

  • Hannan / Freeman (1977): The Population Ecology of Organizations
  • Hannan / Freeman (1989): Organizational Ecology
  • Aldrich / McKelvey developed the Population Ecology approach based on the theory of Hannan / Freeman (1984)
  • Vierling (2008): organizational inertia (draft model)

theory

Based on the assumption that there are three reasons why organizations are only able to adapt to environmental changes in a targeted manner to a very limited extent, namely,

  • (a) Different stakeholders with different goals
  • (b) imperfect information about means-ends relationships
  • (c) the inertia of organizations

Hannan and Freeman deal mainly with "organizational inertia" in their theory .

Hannan / Freeman

According to Michael T. Hannan and John H. Freeman , organizational inertia is caused by a multitude of processes and can be divided into internal and external obstacles. Internal obstacles can, for example, be investments that cannot be made because the necessary know-how is missing or internal resistance to restructuring . Examples of external obstacles can be the market entry and exit barriers or the financial burden for the acquisition of the necessary know-how.

Furthermore, Hannan / Freeman summarize the individual organizations into so-called "populations" , which are then analyzed in their changes. The organizations belonging to a population are characterized by a common basic structure, a common building plan or a common basic pattern.

Starting from these populations, Hannan / Freeman now analyze, with the aid of the theory of evolution , for variation , selection and conservation.

variation

Changes or changes in populations arise primarily through the establishment of new organizations. Many founders orientate themselves on already existing successful organizations, preserve the tried and tested and add new structures.

selection

In the Population Ecology approach, only one type of selection is taken into account, namely the extinction "poor" (poorly adapted, useless) and the survival of "good" (successful) systems . The selection is dictated by the restrictions of the environment. There are many environmental conditions to which an organization has to adapt, for example economic fluctuations , economic crises , technological innovations, unpredictable events and much more.

Preservation / Preservation

According to the Population Ecology approach, successful organizations are institutionalized and taken over into society . In addition, bureaucratic routines are formed that can easily be passed on.

Aldrich / McKelvey

Based on the theory of Hannan / Freeman, Aldrich / McKelvey have now further developed the population ecology approach. In contrast to Hannan / Freeman, they did not work with the term “populations”, but spoke of organizational competencies. These competencies consist of elements of organizational knowledge, such as patents , procedural regulations or work techniques.

variation

The adoption of this “organizational knowledge”, also called comps , takes place through interpersonal interactions , such as external consultants , seminars, but also the hiring of new employees or industrial espionage .

selection

The selection is based on the success that this knowledge promises or has to show. Successful knowledge therefore spreads much faster in this approach than less successful knowledge. Likewise, “knowing” people are often used as role models or invited to lectures and seminars. The poaching of capable employees is also a method of gaining new organizational knowledge.

Preservation / Preservation

As with Hannan / Freeman, the maintenance of these comps is ensured through institutionalization and bureaucratic routines.

Empirical research

Research into the Population Ecology approach showed that populations of organizations are subject to change over time. Three main areas of investigation emerge:

  • Processes of failure of organizations,
  • Establishment processes of organizations and
  • Processes of Organizational Change.

Central concepts of Population Ecology research:

Liability of Newness

It describes the tendency of young companies to leave a market more often than old companies. Some reasons for this are: Young organizations and their managers have to learn their social roles as social actors first; they are forced to rebuild relationships with customers , suppliers and investors and thus have a competitive disadvantage compared to old organizations. Hannan / Freeman (1984) give the other reasons. They claim that only the companies have a high probability of survival, which have a high degree of reliability (reliability) and account ability (accountability) have. In more recent studies, however, the possibility of non-monotonous relationships between the age and survival probability of companies was pointed out. Brüderl / Schüssler (1990) show in an empirical study that the survival probability of a cohort of companies initially decreases in the first few years of life, but then increases continuously as the companies get older. The authors describe this phenomenon as liability of adolescence . Banaszak-Holl (1991) found in her study a positive, insignificant effect of company age on the probability of insolvency and a significant positive effect of age on the probability of a merger . This pattern of increasing mortality rates over time was called liability of aging by Carroll (1987) .

Liability of Smallness

This concept concerns the assumed relationship between the size of the company at the time it was founded and the company's probability of survival. Specifically, it says that, ceteris paribus , smaller companies have a lower probability of survival than large companies of the same age cohort. The main reasons for this are capital market restrictions for the little ones; Cost disadvantages, e.g. B. in production or research ; Disadvantages in the competition for qualified labor, etc. Ambutgey / Dancin / Kelly (1994) find in their studies that the mortality rate of companies initially increases with increasing company size, but decreases again monotonously for large companies. The authors call it liability of the middle .

Theory of Founding Conditions

In various studies, representatives of the Organizational Ecology approach have emphasized the importance of the founding conditions for the survival probability of companies. At the time of establishment, the companies acquire essential structural characteristics that are retained almost unchanged over the entire life cycle. If the characteristics of the company are positively selected by the environment, they increasingly spread within the population. In contrast, companies with inferior characteristics disappear from the population in the longer term. Internal characteristics of the establishment of a company are, for example , the amount of capital and capital structure , the number of predecessor companies, the technology used , etc. Environmental conditions outside the company that influence the characteristics of the establishment of a company are e.g. B. Level of market concentration, the political climate, etc.

Fitness set theory

Hannan / Freeman (1989) investigate the survivability of generalized and specialized forms of organization depending on the dynamics of their niches and hypothesized that specialized forms of organization have a higher probability of survival than generalized in “fine grined” dynamic environments, i.e. in environments with a high frequency of change exhibit.

Some researchers work with the historical evolution of organizations. McKelvey (1982) tries to show the evolution of organizations in Mesopotamia using the example of a family tree . Aldrich / Mueller (1982) explain the displacement of the population according to the same pattern, whereby the respective new forms of organization were better able to cope with the environmental problems of their time - raising of capital and labor - and this explains their spread.

Density Dependencies Theory

The theory assumes that the development of an industry is significantly influenced by two social processes - legitimation and competition. As soon as the number of companies in a population increases, the legitimation of the organizational population increases . The population is increasingly viewed as "socially accepted" (cognitive legitimation) . The increasing legitimacy of the population has a positive effect on the likelihood of new companies being founded. As the number of companies in a population increases, not only does legitimation increase, so does the intensity of competition. All things being equal, increasing intensity of competition reduces the likelihood of further companies being set up and counteracts the positive legitimation effect. The number of companies established in a population at a given point in time is known as the “ population density ”. As the population density increases, the likelihood of establishing established companies rises (legitimation). However, if the population density increases beyond a critical value, the probability of founding a company falls, as does the probability of survival of the established companies (competition).

Organizational change

Explanation of the concept of structural inertia in relation to organizational change. Organization consists of “core features” and “peripheral features”. The “core features” include technology and marketing strategy; Change is comparatively rare in these and lowers the chances of survival of the organization. All other "features" are "peripheral"; Change occurs relatively frequently and could often have a positive impact on the company's success.

criticism

Positive review

Evolutionary aspects in change processes are recorded very well, effects that cannot be planned are included. It is a macro theory as whole populations and not just individual individual organizations are considered. In addition, macroeconomic behavior of sectors is also included.

Negative review

The creation of organizations is not the only possibility for variation; other mechanisms should also be included. Likewise, the restriction of “extinction” as the only mechanism of selection is insufficient. As a further point, the change in the evolutionary mechanisms should also be taken into account, which are also constantly evolving. For example, the ability to make targeted variation has gotten better and better. It is also very difficult to determine when an organization “dies” or which organization “dies” in a merger . Another weak point may be that the organizational populations cannot be clearly delimited from one another and there is (still) no consensus on the definition of populations.

literature

  • Alfred Kieser (Ed.): Organizational Theories . W. Kohlhammer, Stuttgart 2002, ISBN 3-17-017917-9
  • Michael Hannan, John Freeman: The population ecology of organizations . In: AJS 82, 1977: 929-964.
  • Michael Hannan, John Freeman: Organizational Ecology , Cambridge 1989.
  • Josef Brüderl, Rudolf Schüssler : Organizational Mortality: The liabilities of newness and adolescence. In: ASQ 35, 1990: 530-547.
  • Jane Banaszak-Holl: Incorporating Organizational Growth into Models of Organizational Dynamics: Manhattan Banks, 1791-1980. Thesis at Cornell University 1991.
  • Howard E. Aldrich, Susan Mueller: The evolution of organizational forms: technology, coordination, and control. Berlin 1980.
  • Howard E. Aldrich, Bill McKelvey: Design strategy from the population perspective. In: Journal of Management 10, 1984: 67-86.
  • Bill McKelvey: Organizational Systematics. Taxonomy, evolution, classification. Berkeley, CA 1982.
  • Maik Vierling: Management aspects of organizational inertia: a curse and a blessing for managers. Vdm Verlag Dr. Müller 2008, ISBN 3-639-01669-6 , ISBN 978-3-639-01669-7 .