How Growth Is Inextricably Linked From Environmental Factors Essay

1373 Words Apr 13th, 2015 null Page
Organizational growth can ultimately be linked back to economic factors at play. During periods of economic expansion and prosperity, there are heightened incentives for organizations to invest into their infrastructure and expand capacity. During times of economic decline, organizational growth wanes as profit margins dwindle, and increased organizational efficiency becomes key. This paper intends to demonstrate how growth is inextricably linked to environmental factors.

Economic prosperity has a great impact on an organization’s success and thus, its decision process in terms of expansion with innovation and creativity; this is evidenced through a wide variety of both observable and unobservable criteria. Some of the unknown variables are due to the ebb and flow of economic indicators and the fluctuation of business operations on the day-to-day, as indicated by Towse, “little is known, however, about the economics of creativity or what economic incentives it responds to and this is a gap in our understanding of cultural supply that requires detailed research” (Towse, 2010, p.4).
During times of heightened prosperity, there is an increase in the supply of goods – driven by an increase in production. Increases in production, in turn, are driven by increases in demand and the pursuit of excess profit in the marketplace. Phelps notes prosperity as, among other things, “a wide range of careers open to [the labor force]” (Phelps, 2005, p.3). Further fueling production is an…

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