organization theory

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organization theory

a behavioural framework for the analysis of decision-making processes within large complex ORGANIZATIONS. Economic analysis frequently considers a FIRM to be a single autonomous decision-making unit seeking to maximize profit. By contrast, organization theory suggests that in large organizations decisions are often decentralized, that decisions are influenced by other than economic motives and that the decision process is influenced by the company's internal structure, or organization. Nonoptimal or satisficing decisions are the result, rather than profit maximizing. See PROFIT-MAXIMIZATION, FIRM OBJECTIVES, SATISFICING THEORY, BEHAVIOURAL THEORY OF THE FIRM.

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National Cooperative Bank

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