AØKA08026U  Organization Theory

Volume 2013/2014
BSc in Economics
MSc in Economics

The course focuses on work organizations: Business organizations (private firms) and organizations within the public sector, for example public administration, public hospitals, educational and social institutions. A number of basic theories are presented such as Classical Organization Theory, Human Relations, Human Resources and recent theories about structure, processes and culture in organizations. Strengths and weaknesses of the theories are discussed among other things based on empirical research. Organization theory is an interdisciplinary field and the course draws on perspectives from different social science disciplines. A central theme is organizational structure, in other words, how work in an organization is divided into jobs, departments and hierarchical levels and how coordinated effort is achieved. A number of structural forms are discussed such as the simple structure, machine bureaucracy, professional bureaucracy, adhocracy and the divisional form. It is discussed how in particular organizational strategy, size, technology and environment influence the structure of an organization. Both so-called rational and natural theories are discussed. A special theme concerns the choice between market and hierarchy in coordination of economic activity. This leads to a discussion of mergers and acquisitions, outsourcing, virtual organization and hybrids between market and hierarchy such as strategic alliances and networks. Informal structure and group dynamics are also touched upon together with organizational culture comprising the values and basic assumptions of organizational members. The influence of informal structure and culture on the performance of the organization is discussed. Other themes concern organizational processes where decisions, power, leadership, learning and motivation are the most important. Both rational, bounded rational, political and anarchic decision models are presented and power processes in organizations are discussed. Perspectives on leadership are outlined and managerial activities, leadership behavior and styles, value based leadership and contingency theories on leadership and change management are focused upon. Motivation and incentives in organizations are also essential themes where the relative significance of economic and non-economic motivations in particular is discussed. Both classical motivation theories and later content and process theories are part of the course as are the concept and function of performance related pay. The organizational world today is characterized by many and profound changes. These changes in organizational forms caused by new technology, globalization, increased competition and new ideas about management imply more flexible organizations, new managerial strategies and new ways of defining, monitoring and assessing the performance of the organization. The course will highlight important changes and their causes. Finally the course will differentiate between the (voluminous) management literature and organization theory as a scientific discipline and explanations of fads and fashions in the managerial world. In essence, a number of ways of thinking are presented in the course which should enable the economist to think and reflect in a more professional way about the organizational contexts in which she/he will make a career. Organization theory has broad practical and vocational relevance in particular for students aspiring to managerial and administrative positions.

Learning Outcome

The aims are that the student after participation in the course is able to:

• Describe basic principles of the following theories: Classical Organization Theory, Human Relations, Human Resources, Contingency Theory, Institutional Theory, Resource Dependence Theory, Population Ecology, Transaction Cost Theory, New Public Management and Lean Production.

• Describe theories about: Strategy, structure, network, culture, leadership, groups, change, communication, power, decisions, motivation and learning.

• Analyze and compare the theories, their strengths and weaknesses with regard to obtaining an understanding of concrete organizations and organizational phenomena.

• Analyze the relevance of the theories, their strengths and weaknesses from the point of view of practical action and management of tasks and problems in organizations.

• Select, justify and apply relevant theory in analysis of organizational issues or themes described in a concrete case; and present analysis and proposed solution in a written essay in a grammatically correct, clear and coherent way.

• Describe differences and similarities between economic perspectives on organizations and perspectives from other social science disciplines.

• Describe the difference between Organization Theory as a scientific discipline and management literature.


(1) Richard L. Daft, Jonathan Murphy, Hugh Willmott: Organization Theory and Design. An international Perspective. Second Edition. Cengage Learning. 2014. Cases/ exercises not included.
(2) Stephen P. Robbins, Timothy A. Judge, Timothy T. Campell: Organizational Behaviour. Essex: Pearson Education. 2010. Chapters 1,3,6,7,9,10, 12 and 13.Cases/ exercises not included.
(3) W. Richard Scott & Gerald Davis: Organizations and Organizing. Rational and Open System Perspectives. New Jersey: Pearson Education. 2007. - Pages 41-50 on Classical Organization Theory.
(4) David Jaffee: Organization Theory. Tension and Change. New York: McGraw-Hill Higher Education. 2001. - Pages 65-73 & 78-87 on Human Relations and Human Resources
(5) Sytse Douma & Hein Schreuder: Economic Approaches to Organizations. FT Prentice-Hall. Pearson Education. 2008. - Pages 161-178 on Transaction Costs.
(6) Bruno S. Frey & Margit Osterloh (eds.): Succesful Management by Motivation. Balancing Intrinsic and Extrinsic Motivation. Berlin: Springer. 2002. Pages 7-23, 68-70
(7): Gary Dessler: Human Resource Management. Thirteenth Edition. Essex: Pearson Education. 2013. Pages 418-437 on Performance Related Pay and financial incentives.
(8) John P. Kotter: Leading Change. Harvard Business Review. January 2007. Pages 97-103
(9) James L. Perry: Bringing Society in: Toward a Theory of Public-Service Motivation. Journal of Public Administration Research and Theory.10 (2000):2: 471-488
(10) Mary Jo Hatch with Ann L. Cunliffe: Organization Theory. Modern, symbolic and postmodern perspectives. 2nd edition. 2006. Pages 175-194 on organizational culture. 
(11) Arthur G. Bedeian: The Dean’s Disease: How the Darker Side of Power Manifests Itself in the Office of the Dean. Academy of Management Learning and Education. Vol 1 no. 2, 164-173, 2002.
(12) Notes/papers – information during the course (up until 115 pages)
No. 1 and 2 are sold from: Akademisk Boghandel/ Academic Books, CSS, Øster Farimagsgade 5, Building 7. Open: Monday – Friday 9.30-16.00 E-mail: css@academicbooks.dk. Holiday closed in the period 28. June – 20. July.                     

No. 3-12 will be available at Absalon for the students having signed up for the course. 

None. Organization theory has interfaces with other areas such as public administration, strategic management and corporate governance. Formal requirements: None.
3 lectures every working day from the 28th July to the 15th August.
Please visit the course website at Absalon from mid June 2014 or contact Anders Rosdahl directly: ar@sfi.dk. You can find the course website by searching for the name of the course under "Courses".
7,5 ECTS
Type of assessment
Written assignment, 24 hours
Take-Home 24 hours examination. Students can choose to answer the exam in Danish, in Norwegian, in Swedish or in English.
All aids allowed
Marking scale
7-point grading scale
Censorship form
External censorship
100 % censorship
Exam period
Will be updated before the start of the semester
Same as ordinary. But if only a few students have registered for the re-exam, the exam might change to an oral exams with a synopsis to be handed in. This means that the examination date also will change.
Criteria for exam assesment
The Student must in a satisfactory way demonstrate that he/she has mastered the learning outcome of the course.
  • Category
  • Hours
  • Lectures
  • 45
  • Preparation
  • 137
  • Exam
  • 24
  • Total
  • 206