Resource Dependence Theory (RDT) represented a significant departure from extant literature on management and organization studies in the 1970s. Prior to the publication of Jeffrey Pfeffer and Gerald’s The External Control of Organizations: A Resource Dependence Perspective in 1978, the social context and environment surrounding organizations were little studied. Rather, scholars were more interested in examining what was going on in the organization rather than what was happening outside of it. This despite the emergence of open systems (e.g., Katz & Kahn) and other theories that incorporated the environment into the organizational context and helped better explain managerial decisions. RDT took open systems to its logical conclusion – that organizations were dependent on the environment (especially for resources needed), that the environment often included social actors who sought control over organizations, and that managerial decisions sought in turn to mitigate or respond to that control.
The book was the culmination of years of collaboration between the authors whose earlier works included studies on the politics of organizational decision making, job attitudes, task design, executive selection and turnover, and information. The first nine chapters build their arguments in favor of a resource dependence perspective that the final chapter summarizes. In short, organizations require resources and therefore must engage with others who control those resources. The implications are that organizations constantly fight for survival through attempts to mitigate the degrees and manners of control that outsiders have over them. However, organizations and the social actors in the environment are heterogeneous and their perspectives and interests can conflict, creating uncertainty for the organization to deal with. Thus managerial decisions often reflect the organization’s desires to reduce those uncertainties and strive for the predictable and reliable flows of resources.
The implications are many and are detailed in the book. Among them are how organizations deal with the interdependence with other actors that naturally emerges from dependency on resources. These include how managers decide to perform mergers or diversify, outsource functions, or co-opt opponents into becoming members of boards of directors, for example. Another implication is the very meaning of management itself. Pfeffer & Salancik argued that scholars (and the social context more generally) had attributed too much of an organization’s tangible outcomes on the shoulders of executives. Instead, the executive’s primary purpose is symbolic, providing a mechanism for the organization to satisfy external demands. Thus, the executive is also a natural scapegoat when such demands cannot be met or that there simply needs to be a change in leadership when things are not going well.
RDT has since cast a long shadow and provides the foundation for studies on organizational power and other threads.
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Pfeffer, J., Salancik, G. R. (1978). The external control of organizations: A Resource dependence perspective. New York: Harper & Row, Publishers, Inc.
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