Essays on Phillips Environmental Change Case Study

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The paper 'Phillips Environmental Change" is a good example of a management case study. The Phillips NV is reputed as one of the biggest companies that deal in the electronics products. Its products are largely categorized into three major groups which consist of lighting solutions, electronics, various components, computers, and other telecommunication products. Its main competitors include big companies such as Sony and Siemens. In the 1980s the company had a workforce of three hundred thousand workers and its presence was held in sixty national subsidiaries. However, in the 1990s the company was faced with organizational problems and experienced huge losses.

The company was surely being affected by the effects of globalization and we hereby study some of the issues with respect to organizational effectiveness. Environmental Change Organizational effectiveness continues to be used in modern organizations with managers and the management employing different models and other rules in creating effective organizations. Indeed, Morgan (1997, p. 45) defines such a model to be based on the structure and the functionality of an organization. Richard Scott’ s (1987, p. 120) Organizations: Rational, Natural, and Open Systems note that between 1900 and 1930s organizations were closed and rationally oriented.

Such organizations tend to have a focus on internal controls on the organization where effectiveness in such instances is achieved by having specific objectives and goals being set by the company, having structured rules with various roles also being described and closely inspecting and monitoring of such system. Indeed, it is worth noting that the management at this level is more inclined towards setting a bureaucratic system that was prevalent in the early nineteen hundreds as it was more predictable in controlling the management of the organizations with a prescribed behavioral expectation.

However, with the advancement in time such rational programs became outdated and developed tendencies of being maladaptive which in turn resulted in an incompetent and inefficient workforce. As a matter of fact, such a system of internal control was further faulted and was instead recommended to organizations with low levels of complexity but not of organizations with complex systems. In addition, the system was more appropriate where the environment was certain and predictable which could translate to low levels of competition which calls for lesser flexibility.

As a result, the organization's structures do not adequately adapt to changes due to the rigidity of such systems. However, this rational system was later replaced by a natural system which was to seek ways in which the workforce was to be exploited with respect to winning their minds. Such systems had an inclination towards the presence of an informal setting harboring informal relationships between the workers. Indeed, such systems deviated from formal structures and demonstrated that if the workers became more committed and loyal to organizations they were bound to be more fruitful than when they were subjected to prescribed and rational systems. The open systems that later followed the natural systems were of greater concern where organizations became more inclined towards having stable relationships with their environment.

With the environment becoming more challenging the organizations are forced to adapt to interacting with the environment. However, during the 1960s there are variations of this system that existed with some organizations adopting the rational and formally structured system which was most suitable for a stable environment with organizations having massive production volumes but of low complexity.

On the other hand, there also existed the organic organizations which had to adapt to the uncertain environment and thus were forced to specialize in small scale production albeit the work being of high complexity.



Gailbraith, J.R (1973) Designing Complex Organizations Reading, MA: Addison-Wesley pp.56-76

Lawrence, P. & Jay, W (1967) Organization and Environment: Managing Differentiation and Integration. Boston, MA: Harvard University, Pp. 47-53

Morgan, G (1997) Images of Organization, 2nd ed Thousand Oaks, CA: Sage. Pp. 43-48

Richard, F (2002) Organizational Effectiveness, Structure, and Technology [online] accessed from [August 3, 2010]

Scott, R (1987) Organizations: Rational, Natural, and Open Systems Englewood Cliffs,

NJ: Prentice Hall, Pp.45-132

Thompson, J (1967) Organizations in Action New York: McGraw-Hill, Pp.32-37


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