Approaches that are Contemporary

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An organization’s open framework allows for daily input sharing with the outside world. Inputs, methods, outcomes, objectives, evaluation and learning are addressed (Rana, Ali, & Saha, 2016). A healthy open system analyzes the external input in order to adapt the internal structure to achieve the unit’s goals and transmits the knowledge needed back to the environment. Open systems have pore limits, according to Rana, Ali and Saha (2016), that enable feedback from the outside to be exchanged and understand. The internal environment features trends and events, which fall within an organization that influences the management, employees, and the firm’s culture. The microenvironmental factors are critical because they underpin the employees’ behaviors and how they perform. Rana, Ali, and Saha (2016) note that organizational culture is a fundamental component of the internal environment, which consists of values, beliefs, and attitudes that connect the members of an organization. Also, management approaches and leadership models that organizations adopt influence performance and success. A firm should build on its strengths while improving on the weakest aspects to leverage its competitive edge.

Analyzing the competitive environment entails definition and identifying the nature and intensity of rivalry from other firms and designing proactive measures to attain a competitive advantage. The competitive environment consists of industry, suppliers, customers, potential new entrants, products, and substitute or replacement services (Rana, Ali, & Saha, 2016). Some environmental factors affect the competitiveness of an organization. For instance, market structure implies the type of organization that operates in the industry and their extent of concentration. Also, the competitive behavior of the structure depends on the flexibility, types of wants it satisfies, and its degree of focus in the environment. Moreover, the competitive environment presents other factors, which underpin the success of an organization such as the offer, maturity, competitive system, and homogeneity of products sold (Rana, Ali, & Saha, 2016). Also, competitiveness of an organization relies directly on various factors including the arrival of new rival firms, bargaining power of buyers and suppliers, and industrial conditions.

The macro-environment encompasses multiple needs and influences, which affect an organization. The organization has little or no control over the external environment. Political, economic, ecological components, socio-cultural, and technological factors characterize the external environment. An open system helps to exchange information from the external and internal environments of an organization (Rana, Ali, & Saha, 2016). Means of information exchange include the use environment scanning, market research, and assessment. An organization attempts to influence the external environment through public relations, branding campaigns, advertising, lobbying and advocacy among other strategies.

The sociotechnical systems theory is relevant in the outer environment as it urges organizations to integrate the social and technological components of working systems. Contrastingly, the quantitative management theory approach is not appropriate as it focuses on the use of mathematical models to aid decision-making processes (Rana, Ali, & Saha, 2016). It is only useful in controlling and planning. Its primary limitation centers on its inability to predict human behaviors in organizations (Rana, Ali, & Saha, 2016). The organizational behavior approach is beneficial in the study of how people think, feel or act is essential in internal, competitive, and the external environments of a firm. Management of technological change, diversity, and confronting the challenges of the complicated world requires a proper understanding of people’s behaviors. Moreover, the systems theory approach is advantageous as it provides a framework for visualizing macro- and macro-environments of an organization (Rana, Ali, & Saha, 2016). Proponents of the systems theory hold the belief that businesses operate in a complex environment, which presents multifaceted factors that affect business.


Rana, M. M., Ali, M. J., & Saha, A. (2016). The contemporary theory of management: A comparative study on quantitative approach, system approach and contingency Approach. International Journal of Business and Management Invention, 5(5), 14-22.

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