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Resource Dependence Perspective in Management

management, resources, resource dependence theory, administration, managers, management skills, managerial roles

The resource dependence perspective developed a framework to explain why organizations are often forced to establish linkages with other organizations in their environment. As resources become scarce, managers must expand the number of suppliers and receivers of goods in order to maintain stable operations and profits. However, these linkages place constraints on the decisions managers can make to guide the organization toward specific goals. That is, as the organization's activities become dependent on other organizations, there are fewer opportunities to guide the organization in different and novel directions.

Thus, solving the problem of scarce resources can cause a loss of organizational power. The success or failure of the organization becomes more dependent on the decisions and behaviors of the other organizations in the linkage. For instance, a firm that relies heavily on borrowing funds from a bank may include the bank president on its board of directors to promote favorable access to funds. However, the bank president may vote against decisions of the firm that run counter to the interests of the bank (e.g., the firm's decision to issue bonds to raise capital).

The resource dependence perspective is expanded to explain how dependence on organizational environments affects the fortunes of managers as they move up the career ladder. With changes in the environment, in terms of either resource distribution or organizational interdependence, the probability that managers will lose their jobs increases.In line with the contingency approach, environmental changes produce new situations, and new situations may require managers who are better able to adapt.
Published: 2007-05-12
Author: Martin Hahn

About the author or the publisher
Martin Hahn PhD has received his education and degrees in Europe in organizational/industrial sociology. He grew up in South-East Asia and moved to Europe to get his tertiary education and gain experience in the fields of scientific research, radio journalism, and management consulting.

After living in Europe for 12 years, he moved to South-East again and has worked for the last 12 years as a management consultant, university lecturer, corporate trainer, and international school administrator

www.martin-hahn.net

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