Reaction paper #1

Maria Camila Gonzlez Gmez

Organizational Theory

External factors
When mentioning external factors that conspire to affect an organization we can take into
account environmental uncertainty, organizational size and structure, government, raw
materials, human resources, markets, economic conditions of the country, financial
resources, technology, and a few more that truly create a challenging and complex
operating environment. And the real impact is that all of them affect organizational
performance as well because if managers dont know how to respond in a right manner to
these circumstances, the organization could start to fall apart and eventually, dissapear.
There are plenty of ways to react and deal with this external changes, and those include
changes in organizational strategies that could help to build a stronger structure within
the organization. And here, managers need to coordinate the resources theyre working
with very carefully to produce a variety of behaviors that can deal with environmental
change. When an organization has not developed enough internal complexity to adapt to
the environment it cant survive, but, on the contrary, and organization with too much
complexity would just waste resources and, perhaps, lose its ability to react to the
environment.
A crucial point I would like to highlight is the leaders perception of the strategy and
situation of change because processes and changes actually occur because of this
perception. Modern companies are characterized by having a complex adaptive system,
as well as a complex, moving market which constantly switches the environment
conditions and occurences in which the organization operates. And companies are
complex because they are dynamic nets of interactions and they are adaptive because
they have a collective behavior that vary and self-organizes responding to an event.
All of this said, a business needs to reforce and strongly arm their internal complexity,
focusing on having a high capability to quickly adapt. And this is accomplished by having a

model or structural plan that is able to change anytime and respond to any market , law,
crisis, etc. Meaning this to create something like a scheme of practices and principles
mostly that are part of the companys culture and trademark to determine rapid changes.
Currently, in Colombia, exporting-oriented businesses are struggling with a external factor
that is seriously affecting their productivity. And this is the devaluation of the United
States currency, the dollar. Eventhough this factor benefits for sure the importing
companies, it is making a harmful impact on the countrys whole economy because it
reduces competitiveness and takes away tons of Jobs. The coffee industry stopped
receiving last year more than 100,000 million in exports as a result of the cheap dollar.
This represents a huge drop in income for the 550,000 families living in this industry. The
flower sector was pretty affected as well, closing more than 60 companies last year. Also,
the banana sector suffered with 3,000 lost Jobs and currently, 32 farms are about to close.
It is the case of Supertex S.A, a colombian textile company that presented trouble to adapt
to the market. They work under a quality culture base don their management system that
aims to fulfill the quality requirements for the products, meet the needs and expectations
of their customers, and promote the development of their human talent. Supertex S.A has
four business units at the Forefront in design that are their fashion line, full package line,
industrial line and fabrics for matresses line. It is a huge and important manufacturing
Enterprise but the free trade agreement, even if it gives them better options to export,
wage labor costs and high taxes are holding back their competitiveness and access to
these new markets.
Supertex S.A as well as lots of other companies are in current talks with the government to
remove some costs that they are obligated to pay. In the case of Supertex S.A, they have a
Factory in El Salvador, and, over there, the minimun wage, including benefits is USD $280,
while in Colombia it is USD$500, meaning almost double. And adding to it, some
obligatory rate they have to pay to have apprentices in their factories , puts them in a
difficult scenario regarding competitiveness compared to other countries.
Governments, to my view, take advantage most of the times of the industries, and play
how is most convenient for them economically speaking. Even if they see their country
falling apart, they establish and charge companies with taxes for reasons they make up,
only to get richer. This only demonstrates how external factors play a major, if not the

most relevant role in the productivity of a certain Company. And as it is happening in

Colombia, it happens around the whole world and the challenge of developing adaptation
is bigger day to day.