Organizational Ecology: Population Studies in Organizational Dynamics

Organizational ecology is a field within organizational studies that examines the factors influencing the emergence, growth, and demise of organizations. It draws insights from biology, economics, and sociology to understand the environmental and competitive factors that shape organizational behavior.

Levels of Analysis:

Organizational ecology is divided into three main levels of analysis:

  • Community level: The functionally integrated system of interacting organizations within a shared environment.
  • Population level: The set of organizations engaged in similar activities within a specific industry or market.
  • Organization level: The individual organization, including its members and sub-units.

Key Concepts:

  • Population ecology: The study of organizational populations, focusing on the founding, growth, and decline of organizations within a competitive environment.
  • Organizational mortality: The rate at which organizations cease to exist, influenced by factors such as environmental pressures, competition, and resource availability.
  • Inertia and change: The tendency for organizations to resist change due to internal factors (e.g., sunk costs) and external factors (e.g., market pressures).
  • Niche theory: Organizations specialize or generalize their focus in response to environmental conditions, with specialists exploiting a narrow range of resources and generalists adopting a broader range.
  • Density dependence: The relationship between the number of organizations in a market and their founding and mortality rates, with both legitimacy and competition playing a role.
  • Age dependence: The relationship between an organization's age and its mortality risk, often characterized by a "liability of newness" and a "liability of aging."

Evolutionary Approaches:

Organizational ecology has similarities with evolutionary theories in economics and biology. It emphasizes the role of environmental selection, organizational routines, and the limits to adaptability. However, it differs in its focus on organizational forms as units of selection, rather than routines as in evolutionary economics.