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Organizational Theories
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Some Criteria for Evaluation
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A set of ground rules and vocabulary
to facilitate focused discussion
about the Structure of Organization
and management theories are
proposed.
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The many previous efforts at defining and evaluating theory
help establish criteria for theory construction and
evaluation.
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• In the establishment of these criteria,
description is distinguished from
theory, 5
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• and a matrix of criteria for evaluating the variables, constructs and relationships that together compose a theory is developed.
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• The proposed matrix may be useful both for defining the necessary components
of good theory and
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for evaluating and/or comparing quality of alternative theories.
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Finally, a discussion of the way theories fit together to give a somewhat broader picture of empirical reality reveals
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the lines of tension between the two main criteria for evaluating theory.
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In order to talk about the
nature of the universe,
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and to discuss questions of
whether it has a beginning or
an end,
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you have to be clear about
what a scientific theory is
(Hawking, 1988)
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A theory is a statement of relations
among concepts within a set of
boundary assumptions and constraints
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It is no more than a
linguistic device used to
organize a complex
empirical world.
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As Hall and Lindzey pointed
out, the function of a theory “is
that of preventing the observer
from being dazzled by the full-
blown complexity of natural or
concrete events”.
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Therefore, the purpose of
theoretical statements is
twofold: to organize
(parsimoniously) and to
communicate (clearly).
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Many current theories in
organizational behavior fail to
accomplish this purpose,
primarily because they ignore
certain generally accepted rules
about theoretical statements.
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Students of theory construction
have tried to develop a set of rules
for the examination of the
constructs and variables, which
are the units of theoretical
statements.
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They also have attempted to
develop a set of rules for the
examination of the
relationships among these
units.
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Nevertheless, the diversity of these
perspectives suggests the need for a
more specific examination of their
rules as applied to organizational
studies.
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What theory Is Not:
Data, Typologies, and
Metaphors
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The “features or qualities of
individual things, acts, or
events must be distinguished
from theory.
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As Hempel pointed out, the
vocabulary of science has
two basic functions:
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(a)To adequately describe the objects
and events being investigated and
(b)To establish theories by which
events and objects can be
explained and predicted.
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While descriptions may be the
source material of theories,
they are not themselves
theoretical statements.
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In the organization and
management literatures the two
are often confused.
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specifically, three modes of
description must be
distinguished from theory:
categorization of raw data,
typologies, and metaphors.
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All researchers agree that
categorization of data –whether
qualitative or quantitative- is
not theory.
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In this context, much of the
work in organizational and
management science should
not be thought of as theory.
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Categorization characterizes
much of the work in these fields
particularly in the realms of
business policy/strategy and
human resource strategy.
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One theme in the former case,
for example, has been the
search for empirical
categorizations, or gestalts, of
organizational environments,
and characteristics.
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One characteristic in the latter case
has been the search for a
goodness of fit between empirically
derived categorizations of
business strategy and human
resource strategy.
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Some of these studies both
quantitative and qualitative, are
often particularly rich and thus
useful as grounds for theory
building.
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In and of themselves, however,
they clearly fall in Hempels
realm of description, not
theory.
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Other descriptions –
specifically, those based upon
typologies- have been more
abstract in organizing
observations.
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Typologists have implicitly
emulated weber َs ideal
construct, in that most
typologies meet his classic
definition of an ideal type: .
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“A mental construct formed by the
synthesis of many diffuse ….
Individual phenomena which are
arranged, according to a certain
one sidedly accentuated points of
view, into a unified analytical
construct”.
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Yet even these
abstractions should not
be viewed as theory.
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The one –sided accentuation
of which Weber spoke is
found in most typologies.
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For example, in creating a
typology of organizations Blau
and Scott emphasized the
beneficiaries Gouldner,
Leadership Style, and Etzioni,
Compliance Structure.
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While this one –sided
accentuation achieves one of
the goals of theory (i.e.,
eliminating some of the
complexity of the real world).
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And while typologies are more abstract
than a categorical description of raw
data, such typologies are limited to
addressing the primary question asked
by descriptive researchers- the
question of what, rather than the more
theoretical how, why, and when.
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In recent years, metaphors
have become popular in
organizational studies.
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Broadly speaking, a metaphor
is a statement that maintaines
that two phenomena are
isomorphic (i.e., they have
certain properties in common).
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Unlike the case of categorial
analysis of raw data (what are
the phenomena?), or
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Or the case of typology (what is
the most important aspect of
the phenomenon?),
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The metaphor is used to ask
how the phenomenon is similar
to another (often unrelated)
phenomenon.
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Some of the most well –known
metaphors include the notions
of organizations as “loosely
coupled systems” and as
“Garbage Cans”.
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Metaphors are powerfull
literary tools.
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Robert Burns comparison of
his love to a red rose evokes
strong emotional imagery. Here
the description itself suffices.
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To be of use in the
development of theory in O.B. a
metaphor must go beyond
description and be a useful
heuristic device.
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That is, the imagery contained in
the metaphor must assist the
theorist in deriving specific
propositions and/or hypotheses
about the phenomenon being
studied.
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In this context, metaphors are
not theories but may well serve
as precursors to theories, and
should be judged on that basis.
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For example if one chooses to
view organizations as
“nonconflictual zeppelins”, it َs
his or her prerogative to do so.
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What must be evaluated is not
whether organizations are in fact
“nonconflictual zeppelines”, but
rather the propositions and
hypotheses derived from the
imagery.
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If one َs image of organizations as
“nonconflictual zeppelins” is to thrive,
then it is because the quality of
propositions and hypotheses generated
by this image is better than the quality
of those generated by other alternative
images .
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Such as “garbage can models”
or “loosely coupled Systems”.
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What Theory Is
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Building on the works of previous
students of theory construction (e.g.
Dubin, 1964, Nagel, 1961, Cohen, 1980)
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Researchers can define a theory as a
statement of relationships between
units observed or approximated in
the empirical world.
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Approximated units mean constructs,
which by very nature can not be
observed directly (e.g. centralization,
satisfaction or culture).
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Observed units mean variables,
which are operationalized
empirically by measurement.
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The primary goal of a theory is
to answer the question of how,
when, and why, unlike the goal
of description, which is to
answer the question of what.
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In more detailed terms, a theory
may be viewed as system of
constructs and variables.
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In which the constructs are
related to each other by
propositions and the variables
are related to each other by
hypotheses.
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The whole system is
bounded by the theorist َs
assumptions.
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BOUDARY
Constructs
Variables
Constructs
Variables
Propositions
Hypotheses
GENERAL
I
ZAB
I
L
I
TY
BOUDARY= Assumptions about values, time, and space.
Figure 1. Components of a theory
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Boundaries of
Theories
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The notion of boundaries based
on assumptions is critical
because it sets the limitations
in applying the theory.
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As Dubin (1969) maintained, all
theories are constrained by
their specific critical bounding
assumptions.
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These assumptions include the
implicit values of the theorist
and the often explicit
restrictions regarding space
and time.
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Values are the implicit
assumptions by which a
theory is bounded.
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Theories can not be
compared on the basis of
their underlying values.
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Because these tend to be the
idiosyncratic product of the
theorist َs creative imagination
and ideological orientation or
life experience.
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This may explain why perpetual
debates such as those between
Marxists and Structural
Functionalists have made so
little progress over the years.
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As Weber pointed out, the
value – laden nature of
assumptions can never be
eliminated.
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Yet if a theory is to be properly
used of tested, the theorist َs
implicit assumptions which
form the boundaries of the
theory must be understood.
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Unfortunately, theorists
rarely state their
assumptions.
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Thus, while Mintzman َs (1970) extensive
and fascinating discussion of the
influence of Weber َs personal reality on
his theoretical product, does not serve
to expand or change Weber َs theory.
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It does assist in explicating
the implicit values which
bound his theory.
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An example of how a theorist َs
values may be manifest in a
theoretical debate may be
found in a classic debate over
the concept of power.
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Parsons maintained that power
is essentially the mobilization
of resources and thus is not a
zero-sum game.
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On the other hand, C. Wright
Mills (1956) maintained that
power is the control of
resources, and thus is a zero-
sum game.
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An argument may be made that
this differential orientation
toward power is based on these
theorist َs different values.
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Parsons, viewing society
and organizations as
functional and consensual
systems,
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Ignored the possibility of
finite resources as a
potential source of
conflict,.
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Rather, he saw resources
as being capable of
perpetual expansion.
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Mills on the other hand,
seeing society and
organizations as stratified
and conflictual entities,
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Ignored the expansive
nature of resources and
istead emphasized finite
resources and a zero-sum
notion of power.
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The interaction between
these two theorists is thus
implicitly a collision of
values.
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The current debate over the
application of the concept of
culture to the organizational
context also may be viewed as an
example of the implicit debate over
values if not ideology.
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During the early
resurrection (by
organizational theorists)
of the concept of culture,
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(Schein, 1985; Deal and
Kennedy, 1982), most theorists
chose to view it as an
integrative normative device.
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In doing so they implicitly drew
on the values that underlie
functionalist theorizing by
scholars such as Radcliffe –
Brown (1949), Malinowski
(1962), and Durkheim (1933).
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Therefore, their implicit functional
orientation (placing emphasis on
sustaining the organization as a
whole) may make them vulnerable
to criticism that they serve the
interests of management.
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In more recent work from the
conflict theory perspective,
culture is viewed as an
organizational mechanism for
the normative coercion of the
individual worker.
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For example, Kunda, in
studying a company that
is often held up as a
shining model of the
positive normative impact
of culture,
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unveiled a story of
oppression where others
told a tale of productivity.
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While these two
orientations toward
culture are not inherently
inconsistent,
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They do show the effects of
different values on the
construction of theories
about organizations.
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While values often can only be
revealed by psychoanalytic,
historical, and ideological
studies of the theorist, spatial
and temporal assumptions are
often relatively apparent.
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Spatial boundaries are
conditions restricting the use of
the theory to specific units of
analysis (e.g., specific types of
organizations).
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Temporal contingencies
specify the historical
applicability of a theoretical
system.
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Taken together spatial and
temporal boundaries restrict
the empirical generalizability of
the theory.
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While most theories are limited
by spatial and temporal
restrictions, some are more
bounded by one than the other.
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For example, some theories
may be unbounded in time, but
bounded in space.
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That, these theories are only
applicable to specific types of
organizations, but can be
applied over different historical
periods.
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Other theories are unbounded in
space (that is they may be
applicable to many types of
organizations) but very much
bounded in a specific temporal
context.
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Finally, theories may be
relatively unbounded in both
space and time.
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Such theories have a higher level of
generalizability than those bounded in
either or both space and time, ceteris
paribus(other things being equal).
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of course, this generalizability
requires a higher level of
abstraction.
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which means that theory
sacrifices the level of detail
needed to fit a specific
situation.
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This leads to the paradox that some of
the most detailed theories and
elaborate studies about organizations
are not generalizable enough to build a
cumulative body of research on (e.g.,
Goffman َs theory of total institutions).
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On the other hand, some of the
most abstract and broad
perspectives on organizations
while not necessarily rich in detail,
have provided a critical basis for
cumulative research (e.g., Hannan
and Freaman َs 1977, population
ecology, and Kimberly and Miles,
1980, life cycle theory).
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Implied in the notion of
generalizability are different
levels on which one can
theorize.
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This implicit continuum streches
from empirical generalizations (rich
in detail but strictly bounded in
space and/or time) to grand
theoretical Statements (abstract,
lacking in observational detail, but
relatively unbounded in space and/
or time).
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Variables, Constructs, and
Relationships.
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Within these boundaries
lies the stuff of theory.
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On a more abstract level,
propositions state the relations
among constructs, and on the
more concrete level, hypotheses
(derived from the propositions)
specify the relations among
variables.
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In this content, theorists must
be specific in how they use the
notions of constructs and
variables.
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Theorists should not use these
terms synonymously.
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Constructs may be defined as
“terms which, though not
observational either directly or
indirectly, may be applied or even
defined on the basis of the
observables.
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A variable may be defined as an
observable entity which is
capable of assuming two or
more values.
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Thus a construct may be
viewed as a broad mental
configuration of a given
phenomenon, while a variable
may be viewed as an
operational configuration
derived from a construct.
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Schwab listed a number of
examples of such constructs
and their related variables (e.g.,
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Performance: sales or return on
investment;
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Cohesion: rate of interpersonal
interaction or member voting
patterns;
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Leader consideration: member
perceptions of specific
supervisory behavior.
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Created within the context of
specified boundaries and built
from abstract constructs or
their more concrete
manifestations (variables),
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Theoretical systems take the
form of propositions and
proposition – derived
hypotheses.
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While both propositions and
hypotheses are merely statements
of relationships, propositions are
the more abstract and all-
encompassing of the two, and
therefore relate the more abstract
constructs to each other.
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Hypotheses are the more
concrete and operational
statements of these broad
relationships and are therefore
built from specific variables.
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Generation of Criteria for the
Evaluation of Theories.
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No evaluation of a theory is
possible unless researchers
first establish those broad
criteria by which it is to be
evaluated.
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Based on previous work (e.g.
popper, 1959; Nagel, 1961;
Hempel, 1965),
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The two primary criteria upon
which any theory may be
evaluated are (a) falsifiability
and (b) utility.
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Falsifiability
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Falsifiability determines
whether a theory is constructed
such that empirical refutation is
possible.
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While the idealistic goal of science
is the pursuit of universal truth,
most philosophers of science
would agree that theories can
never be proven, only disproven.
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As Popper maintains, “It must
be possible for an empirical
scientific system to be refuted
by experience.
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Theories are thus like the
accused in a courtroorm –
innocent until proven guilty.
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The problem with organizational
studies is that theories are often
stated in such a vague way that the
theorists can rebut any
discrediting evidence.
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Just as no person can be above
the law, no theory ought to be
constructed in such a way that
it is forever exempt from
empirical refutation.
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If researches are to avoid wading
through ever deeper piles of
irrefutable statements disguised as
theories, they must be able to discard
such false theories.
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To be able to do this, they must
try to construct theories that are
coherent enough to be refuted.
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Utility
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Utility refers to the
usefulness of theoretical
systems.
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As Bierstedt (1959) pointed out,
utility may be viewed as “the
bridge that connect theory and
research.
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At the core of this
connection are explanation
& predictation.
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That is, a theory is useful if
it can both explain und
predict.
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An explanation establishes the
substantive meaning of
constructs, variables and their
linkages,
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While a prediction tests that
substantive meaning by
comparing it to empirical
evidence.
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One problem of incomplete theoretical
systems is that they are often used to
make predictions, yet they do not
provide explanations.
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In this context, kaplan (1964) spoke of
the ancient astronomers, who were
able to make superb predictions but
were in capable of providing adequate
explanations of observed phnomena.
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Thus in organizational behavior, when
researchers accept predictive
statements as theory (e.g., the
proposition: the greater the
organizational size, the greater the
horizontal differentiation;.
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Or its derived hypothesis: the greater
the number of employees, the greater
the number of departments), they
sound a bit like the ancient
astronomers.
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Only when theory shows how and
why larger organizations have
more departments will be able to
explain as well as predict.
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The Falsifiability of
Variables, Constructs, and
Relationships.
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With an understanding of the
components of theory at different
levels of abstraction (variables
constructs and the relationships that
connect them).
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And the two main types of criteria
(falsifiability and utility), researchers
can begin to understand the way these
criteria can be applied to theory.
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Because constructs and variables are
the building blocks of hypotheses and
propositions, theorists must first
evaluate them before analyzing the
relational properties of theories.
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If they are working with inappropriate
constructs and variables, how these
constructs and variables are assembled
into hypotheses and propositions is
irrelevant.
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All parts of a bridge may fit together
perfectly, but if this bridge is
constructed of “silly-putty”, it is not a
good idea to drive over it.
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By beginning the analysis with
variables and constructs, researchers
are not excluding the possibility that
theory building or evaluation is a
process which begins with the
examination of the relationships in
hypotheses and propositions.
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Or what kaplan (1964)
noted, “the proper concepts
are needed to formulate a
good theory,
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but we need a good theory to
arrive at the proper
concepts.”