The environmental school of thought has three different views in looking at the influence of the environment on the organization. The first view, the Contingency, states that there is no one best way to run an organization, it all depends on four main dimensions of the environment. According to the stability dimension, an organization's environment can range from stable to dynamic. A variety of factors can make an environment dynamic, including unstable governments, unexpected changes in consumer demand or competitor supply, a rapidly changing technology or knowledge base, and even weather that can not be forecasted. The complexity dimension deals with an environment that is complex to the extent that it requires the organization to have a great deal of sophisticated knowledge about products, customers, and supply. It becomes simple when this knowledge can be rationalized and broken down into easily comprehended components. The third dimension is market diversity where organizations can vary from ones who sell their only product to one main distributer to ones that sell their many products to many other companies all around the world.... [continues]
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