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Essay / Environmental and Environment Essay - 1123
Provan, Beyer, and Kruytbosch (1980) argued that organizational control can be viewed as a reciprocal relationship between organizations and the environment. It has been suggested that organizational power increases with decreasing dependence on resource providers (Provan et al., 1980). Furthermore, it has been argued that power, as well as the attainment of resources, is determined not only by dependencies between organizations, but also by the organization's relationships with the broader environment in which they exist ( Provan et al., 1980). The exchange of resources with the environment creates power relations between organizations (Scott and Davis, 2007). As obtaining resources is essential to the survival and prosperity of an organization, the availability of resources determines the organization's position in the environment as well as its power over other organizations (Provan et al., 1980 ). Therefore, resource dependence theory is based on the assumption that organizations are highly dependent on other organizations that provide essential resources and, more importantly, this dependence is often reciprocal (Drees & Heugens, 2013). The theory also explains the involvement of organizations in various interorganizational arrangements, such as interlocking directorates, alliances, and joint ventures (Drees et al., 2013). By engaging in inter-organizational agreements, organizations strengthen their autonomy as well as their authority over other organizations (Drees et al., 2013). Since autonomy and power within the environment have a significant impact on organizational performance, it cannot be denied that resource-dependent relationships are one of the major concerns of organizations.