An Integrated Formalization of Organization-Environment Interdependencies

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Abstract
A formal model is developed facilitating (1) an integration of theories dealing with organization-environment interaction, and (2) an explanation of how an organization's boundaries become increasingly permeated by the environment. It is argued that rates of change per se represent the principal impetus in promoting adaptive exchanges between an organization and its environment, both for long-term (evolutionary) and short-term (mutational) changes in the environment. The model reveals that a key variable in organization-environment interdependencies is the ratio of legitimate demands placed upon the organization by the environment to either the capacity or minimum performance levels of the organization.

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