Corrected for the test exam - Management - Session 2008 –INTEC.
1 - Dependence or autonomy: market organizations have what relation with their
environment? You will highlight the complexity of the relationship by relying as much
as possible on examples.
The question of the degree of autonomy or, on the contrary, the dependence of the
organization vis-à-vis its environment is central to strategy. We tend to say in general that
organizations merchants "must adapt to their environment", thus making the implicit
assumption that firms are situation of strong dependence on their environment. In reality, it is
the "market power" of an organization that needs to be assessed, that is, the latter's ability to
influence other stakeholders in its environment. In other words, the notion of "market power"
illustrates the existence of a relative autonomy of firms in relation to their environment.
For example, the weight of car manufacturers in the economy is such that they are able to
form pressure groups and influence certain aspects of public policies, for example in terms of
employment or aid to the sector (examples of the various scrap, or the proposed bonus for the
purchase of a clean vehicle planned for 2008).
Market power strongly depends on the competitive situation within each sector of activity: a
company can impose its products and general policy choices more easily in a position of
almost monopoly than in a situation of pure and perfect competition. By bringing the firms
closer to the monopoly, mergers and acquisitions movements thus constitute attempts for the
companies concerned.
To reduce their dependence on the uncertainties of the environment and thus increase their
market power and therefore their autonomy.
Other factors may play a role in explaining the greater or lesser market power of a firm, such
as the size (small size is not necessarily a symptom of low market power, as demonstrated by
the position of many locally well-established artisans), the situation in an employment area,
the mastery of a technology or other resource essential to the business. Note that an
organization whose power to market would be very high (example of Microsoft which was
close to the monopoly situation) could consider the components of its general environment as
"endogenous" variables because it constructs them more than it does do not suffer them.
2 - What are the contributions of the work of Crozier and Friedberg to the
understanding of organizations?
The pioneering work of Michel Crozier (Le phenomenon bureaucratique, 1963), then those he
carried out with Erhard Friedberg (The actor and the system, 1977) imposed the strategic
analysis of organizations (the sociology of organizations) and its concepts: power,
uncertainty, and concrete action system. The central idea is that in any organization,
individuals and social groups are seen as actors with objectives and specific strategies that
they will seek to achieve through the organization and the opportunities it offers. From where
the interest of studying the internal rules of social life and the logics of the actors to
understand the functioning of any organization.
, Crozier and Friedberg take as a reference the Weberian model of bureaucracy, a form of
organization rational and legal and seek to understand its dysfunctions. Starting from the
analysis of large bureaucratic organizations, in this case a department of the Ministry of
Finance and an industrial monopoly state, and then broadening the study to other sectors of
activity, they offer an interpretation of organizations such as action systems whose balance
depends on adjustments between the specific objectives of the different actors.
Analysis of the strategies implemented by them is therefore necessary to understand and
develop any organization.
If we judge by its echo in the scientific community, but also in companies and among
managers, strategic analysis has enriched the understanding of how organizations work. It
allows in effect of integrating, in a diagnostic approach, logics neglected as well by the
Taylor’s model (centered on the analysis of technical systems) than through the school of
human relations which emphasizes exclusively the social system. It thus relativizes the weight
of the external determinants of the organization, economic, technical or social. Showing that
next to and around the formal structure informal games between actors take place, she
qualifies the notion of power and allows a less mechanistic reading of organizations by
conferring on communication and relationship systems an essential place. In addition, by
focusing on internal mechanisms regulation thanks to which the company fulfills its missions,
it shows that the dysfunctions induced by the freedom of actors can also be modes of
operation and participate in the balance of any system organized.
3 - What is the interest of game theory (illustrated by the prisoner's dilemma) for the
analysis of processes decision-making?
Game theory highlights the superiority of the non-cooperative solution (Nash's equilibrium)
over the cooperative solution; the prisoner's dilemma thus shows how perfectly rational
individual choices (let's not forget that agents are supposed to have perfect information and to
be themselves perfectly rational, which implies that they individually seek to maximize their
utility) sometimes lead to sub-optimal situations, and therefore collectively not very rational.
Game theory allows for example to describe the behavior of members of an oligopoly who
profit from the constitution of a cartel while having individually interest in breaking the rules.
We understand better why it is so difficult to reduce greenhouse gas emissions while everyone
would benefit from international cooperation on this theme.
Some countries may be tempted to take advantage of the efforts of others to increase their
emissions… Such “free rider” behavior is only preventable if an external institution is able to
force agents to adopt a cooperative solution. What is far to be the case in the example of
pollution.
1 - Dependence or autonomy: market organizations have what relation with their
environment? You will highlight the complexity of the relationship by relying as much
as possible on examples.
The question of the degree of autonomy or, on the contrary, the dependence of the
organization vis-à-vis its environment is central to strategy. We tend to say in general that
organizations merchants "must adapt to their environment", thus making the implicit
assumption that firms are situation of strong dependence on their environment. In reality, it is
the "market power" of an organization that needs to be assessed, that is, the latter's ability to
influence other stakeholders in its environment. In other words, the notion of "market power"
illustrates the existence of a relative autonomy of firms in relation to their environment.
For example, the weight of car manufacturers in the economy is such that they are able to
form pressure groups and influence certain aspects of public policies, for example in terms of
employment or aid to the sector (examples of the various scrap, or the proposed bonus for the
purchase of a clean vehicle planned for 2008).
Market power strongly depends on the competitive situation within each sector of activity: a
company can impose its products and general policy choices more easily in a position of
almost monopoly than in a situation of pure and perfect competition. By bringing the firms
closer to the monopoly, mergers and acquisitions movements thus constitute attempts for the
companies concerned.
To reduce their dependence on the uncertainties of the environment and thus increase their
market power and therefore their autonomy.
Other factors may play a role in explaining the greater or lesser market power of a firm, such
as the size (small size is not necessarily a symptom of low market power, as demonstrated by
the position of many locally well-established artisans), the situation in an employment area,
the mastery of a technology or other resource essential to the business. Note that an
organization whose power to market would be very high (example of Microsoft which was
close to the monopoly situation) could consider the components of its general environment as
"endogenous" variables because it constructs them more than it does do not suffer them.
2 - What are the contributions of the work of Crozier and Friedberg to the
understanding of organizations?
The pioneering work of Michel Crozier (Le phenomenon bureaucratique, 1963), then those he
carried out with Erhard Friedberg (The actor and the system, 1977) imposed the strategic
analysis of organizations (the sociology of organizations) and its concepts: power,
uncertainty, and concrete action system. The central idea is that in any organization,
individuals and social groups are seen as actors with objectives and specific strategies that
they will seek to achieve through the organization and the opportunities it offers. From where
the interest of studying the internal rules of social life and the logics of the actors to
understand the functioning of any organization.
, Crozier and Friedberg take as a reference the Weberian model of bureaucracy, a form of
organization rational and legal and seek to understand its dysfunctions. Starting from the
analysis of large bureaucratic organizations, in this case a department of the Ministry of
Finance and an industrial monopoly state, and then broadening the study to other sectors of
activity, they offer an interpretation of organizations such as action systems whose balance
depends on adjustments between the specific objectives of the different actors.
Analysis of the strategies implemented by them is therefore necessary to understand and
develop any organization.
If we judge by its echo in the scientific community, but also in companies and among
managers, strategic analysis has enriched the understanding of how organizations work. It
allows in effect of integrating, in a diagnostic approach, logics neglected as well by the
Taylor’s model (centered on the analysis of technical systems) than through the school of
human relations which emphasizes exclusively the social system. It thus relativizes the weight
of the external determinants of the organization, economic, technical or social. Showing that
next to and around the formal structure informal games between actors take place, she
qualifies the notion of power and allows a less mechanistic reading of organizations by
conferring on communication and relationship systems an essential place. In addition, by
focusing on internal mechanisms regulation thanks to which the company fulfills its missions,
it shows that the dysfunctions induced by the freedom of actors can also be modes of
operation and participate in the balance of any system organized.
3 - What is the interest of game theory (illustrated by the prisoner's dilemma) for the
analysis of processes decision-making?
Game theory highlights the superiority of the non-cooperative solution (Nash's equilibrium)
over the cooperative solution; the prisoner's dilemma thus shows how perfectly rational
individual choices (let's not forget that agents are supposed to have perfect information and to
be themselves perfectly rational, which implies that they individually seek to maximize their
utility) sometimes lead to sub-optimal situations, and therefore collectively not very rational.
Game theory allows for example to describe the behavior of members of an oligopoly who
profit from the constitution of a cartel while having individually interest in breaking the rules.
We understand better why it is so difficult to reduce greenhouse gas emissions while everyone
would benefit from international cooperation on this theme.
Some countries may be tempted to take advantage of the efforts of others to increase their
emissions… Such “free rider” behavior is only preventable if an external institution is able to
force agents to adopt a cooperative solution. What is far to be the case in the example of
pollution.
