8
CHAPTER TWO REVIEW OF RELATED LITERATURE
This chapter consists of review of literary theories, review of American modern social life, and theoretical framework. Review of literary theories presents a review of
theories of organization, work groups, leadership, and strategic management. Theoretical framework describes the summary of the theories to answer the problem formulation.
2.1 Review of Literary Theories
This section deals with the fundamental theories of this study. The theories are used to analyzed the topic chosen in chapter one. Those theories are theory of
organization, theory of work groups, theory of leadership, and theory of strategic management. The theory of organization is applied to analyze Maggie’s organization.
The theory of work groups is applied to analyze the group within Maggie’s organization. The theory of leadership is used to analyze Maggie as the leader of the
organization. The last part is theory of strategic management which is used to analyze Maggie’s organization to take achieve the organizational goal.
2.1.1 Organization
Daft states that there are four characteristics of an organization. First, an organization is a social entity. The key element of an organization is not the physical
shapes such as building, set of policies or set of procedures. The gathering of people, the interaction, and their relationship with one another are considered as the key
elements of an organization. Second, an organization is goal-directed. An organization exists when the interaction of those people, as mention in the first characteristic of an
organization, intend to achieve goals. Third, an organization is designed as deliberately
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
9 structured and coordinated activity systems. The leader has legitimate power from his
appointment. By this power, the leader may arrange the structure of the subordinates and coordinate organizational resources to achieve the organizational purpose. Fourth,
an organization is connected to the external environment. An organization cannot exist without interaction with the external environment. Daft, 11
Hodge and Anthony explain that the basic meaning on an organization is the establishment of some system of structural relationships which cooperation emerges in
it. This activity is directed toward group’s goals. In short, organization is the cooperative working of two or more people toward group’s goals. Thus, the elements of
organization are human element, physical element, work element, and coordination element. Management is needed to run an organization. The management is meant to
build the organization form, function, and survive. Hodge and Anthony, 7 According to Daft 11-12, there are two types of organization. The first type is
for-profit business organization. In this type of organization, the manager directs their activities toward earning money or profit for a company. This kind of organization is
money oriented .The second type is non-profit organization. In non-profit organization the manager directs their effort toward generating some kinds of social impact.
Organizations are around us and shape our lives in many ways. Organizations bring contributions and important in society. There are three importance of
organizations related to human life. The first importance of organizations is
organization enhance the opportunity to accomplish specific goals that cannot be reach by individual. The second is organizations also produce goods and services. The third
is organizations adapt to and influence a rapidly changing environment.
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
10 2.1.2
Work Groups A gathering of individuals is not always considered as a group. There are
interactions among the members in a group. The members believe that the chance to accomplish their goal will be greater if they are working in a group. According to
George and Jones 311, a group can be defined as a set of two or more people who interact with each other to achieve certain goals or meet certain needs.
There are many people in a group. It is an inevitable condition that each member will have a different goal. However, each goal has something in common
which supports the main goal of the group. It means that the level of members’ goals is lower than group’s goal. George and Jones 312 explain that a group goal is one that
all or most members of the group can agree on. There are many types of formal work groups in an organization, and each work
group plays an important role in determining organizational effectiveness efficiency toward the goal. George and Jones 312-314 classify work groups into formal groups
work and informal groups work. The classification of the groups’ type is based on how the groups are set up.
The first type is formal work group. A formal work group is established in helping organization to achieve its goals. The goals of formal work groups are
determined by the needs of organization. There are four kinds of formal work group, namely command groups, task forces, teams, and self-managed work teams.
A command group consists of some members who report to the same leader. The leader of this group plays hisher role as a supervisor. The communication
occurring in this group is a two way communication where each member gives report
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
11 to the leader. The leader will then give command as a feedback. This communication is
meant to maintain the effectiveness and efficiency of the group. This type of group has more dependent on their leader.
A task force is a gathering of some members who deal with a specific purpose. A task force will be disbanded after the goal has been carried out. However, when a
goal or problem of long-term occurs to an organization, a task force will not be disbanded but their membership is changed. The members are periodically changed to
offer a fresh insight about the goal or problem. The purpose of this change is to keep the members work on their regular job.
A team is build to overcome specific problem which could not be done by individuals who work separately or others kinds of group work. In a team, the special
abilities and experience is needed. This group shows a high level of interaction and work together intensely to achieve a common group’s goal. Thus, a team can solve the
problem of an organization. A self-managed work team is a team which consists of some members with
high competency. Each member is responsible not only for themselves but also for the team. Since this group does not have any leader, each member performs leadership
tasks. Despite their equal position, the members may determine how the group should go about achieving its goals, assigning task to tasks to individual members, disciplining
group members who are not performing a satisfactory level, coordinating efforts across group members, and hiring and firing.
The second type is informal work group. An informal work group emerges naturally in an organization because members believe that working together in a
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
12 team will help them to achieve their goals or meet their needs. There are two
kinds of informal groups work. First is friendship group. A friendship group is a collection of organizational members who enjoy each other’s company and
socialize with each other. Second is interest group. An interest group is an informal work group consisting of people who come together because they have a
common goal or objective related to their organizational membership. 2.1.3
Leader Leader is one of the most important aspects of studies of human behavior
in organization. The leader creates working environment. The success of an organization depends on the efficiency of the leader. According to Kondalkar, the
attributes of an efficient leader are positive approach, ability to solve problems, ability to motivate employee, and ability to control the situation.
Those four attributes may determine the success of an organization. The attributes of an
efficient leader are explained bellow. Kondalkar, 224-226 The first attribute is positive approach. Positive approach means a leader
has an ability to use power effectively. The author explains a leader gains power from his appointment. This legitimate power leads a leader to gain obedience from
his subordinates. The powers used by the leader are expert power, referent power, reward, and coercive power.
The second attribute is an ability to solve problems. An ability to solve problems means an ability to comprehend the subordinates. The author states this
ability means that a leader has to understand the subordinates’ needs, expectations, and what a leader should do to satisfy them. Moreover, ability to
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
13 comprehend is also ability to explore the situation. By this ability, a leader may
have comprehensive view to accomplish the organizational goal. The third attribute is an ability to motivate employee. An efficient leader
should have the ability to inspire his subordinates. A leader has to acknowledge when his subordinates face hopeless situation. A leader must identify each
individual’s capabilities, and skill to inspire them. Inspiration comes from a leader who has charm, appeal, and dedication. By having this ability, a leader can
enhance subordinates’ loyalty so that the subordinates willingly do as the leader desire.
The fourth attribute of an efficient leader is leadership style. Leadership style is an ability of a leader to control situation. Leadership style consists of two
actions. The first action is the ability of a leader to develop a supportive situation among the subordinates. The second is the ability to arouse motivation among the
subordinates by designing and maintaining an environment for efficient performance. A leader should identify the motivational needs, the subordinates’
desires, and design a plan that fulfills motivational needs and aspirations of the subordinates. A leader must be participative. It means that a leader must face the
same problem as his subordinates, work in the same environment, and not show the sign of tiredness.
According to Warren and Benin, managers are different with leaders. A manager works in organized sector while a leader works in non-organized sector.
Furthermore, Warren and Benin explain about the differing characteristics
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
14 between a manager and a leader. The comparison between a manager and a leader
are explained bellow. There are twelve characteristics of a manager. Basically, a manager works
by virtue of the work procedures. Warren and Benin state that a manager works as an administer, a copier, a maintainer, a systems and structures controller, short-
range view, rely on control, ask how and when, eye on the bottom line, an imitate, accept the status quo, classic, and do a thing right.
A leader has more deliberately work procedures than a manager. Warren and Benin state that there are twelve characteristics of a leader compare to a
manager. A leader works as an innovator, an original, a developer, a people controller, long-range view, an inspirer trust, ask what and why, eye on the
horizon, an originate, a challenger, own person, and do right things. Warren and Benin, 13
2.1.4 Leadership A leader emerges when a follower exists. An effective follower is an
independent and carries out assignment with energy and enthusiasm. An effective follower is not only committing to the leader’s interest or the group’s goal, but
also courage to defend for what he believes. A good follower requires creativity, therefore a good follower will not depend on the leader. The relationship between
a leader and a follower is determined by leadership. Daft defines leadership as an influence relationship among leaders and
followers for real changes and outcomes as the reflection their share purposes. Leadership involves influence which is occurs among leaders and followers. Both
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
15 leader and followers have intentional desire for significant changes as reflected in
their shared purposes. Influence means that the relationship among people is not passive. However, the concept of influence in this definition is multidirectional
and non-coercive. Leadership involves creating change, not maintaining status quo. The changes sought reflect purposes that leaders and followers share.
Moreover, change is toward a preferable outcome that leader and followers both want. Thus, leadership involves the influence of people to bring about change
toward a desirable future. Daft, 5-6 2.1.5
Strategic Management Strategic management gives benefit to an organization. The purpose of strategic
management is to develop and create new and different opportunities. By applying strategic management, an organization may have wider opportunities to achieve the
organizational goal. According to David 5-6, strategic management can be defined as the art and
science of formulating, implementing, and evaluating cross-functional decisions that enable an organization to achieve its objectives. The author explains that the definition of
strategic management focuses on three main parts. The first part is planning and field study. The second part is operations. The third part is research and development. Those
three parts are intended to achieve organizational success. David states that there are three stages of strategic management. The first stage is
strategy formulation. The second stage is strategy implementation. The last stage is strategy evaluation. The explanation of the three stages of strategic management is
explained bellow.
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
16 The first stage is strategy formulation. Strategy formulation is also known as
strategic planning. The author explains that strategy formulation consists of six steps. The first step is creating a vision and mission. The second step is analyzing an organization’s
external opportunities and threats. The third step is determining internal strengths and weakness. The fourth step is establishing long-term objectives. The fifth step is preparing
alternative strategies. The last step is choosing particular strategies to pursue. Since there is no organization has unlimited resources, the strategist plays an
important role to decide the most suitable tactic for the organization. Those six steps, according to the author, are the main consideration for the strategist to choose the rightful
plan will benefit the organization most. An organization has dependency to the leader. A good leader has the best perspective to understand the element of formulation decision.
Moreover, a good leader has the authority force the subordinates for implementation. The second stage is strategy implementation. Strategy implementation is also
called the action of strategic management. Strategy implementation means the leader and the subordinates applying the formulated strategies into action.
Strategy implementation is considered as the most difficult stage in strategic management. According to the author, strategy implementation requires personal
discipline, commitment, and sacrifice. The success of strategy implementation depends on the leader’s ability to motivate the subordinates. Strategies formulated but not
implemented is useless. The third stage is strategy evaluation. The author states that strategy evaluation is
meant to gain the information of the strategies formulated which are not working well. There are three fundamental strategy evaluation activities. First is reviewing external and
PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI PLAGIAT MERUPAKAN TINDAKAN TIDAK TERPUJI
17 internal factors from current strategies. Second is measuring performance. Third is taking
corrective actions.
2.2 Critical Approach
