Agent Perspectives

Subsequently, once the term the ‘organizations’ have been consolidated, as active entities with a preponderant role within society that acts not only as economic-based agents but also as welfare provider to their stakeholders, and the concept of 'place' as a multi-dimensional meaningful space that is built based on the social, material, economic, and natural dimensions. Nevertheless, the balance between economic efficiency and social welfare in every organization is not a common task of easy resolution, this goes beyond the maths of operational costs in comparison to the allocated resources. This search is still going on, as was reviewed in the previous sections many factors may influence, a certain region may influence largely or slight, as well as the kind of industry, the power of the communities where corporations are located, or the prioritization made by their executives.

The guidelines and importance that those responsible for executive decisions give to fulfil their role within society will be of special importance, this is how corporations will privilege establishing an integrative relationship of mutual dependence with their environment or acting as external agents to the environment in the one they meet, generating a non-dependent relationship with their environment. Additionally, each organization must establish the specific weight that the compliance of corporative mission and goals for each have for each one of them (Banning and Thomas, 2014). This exercise reveals a trade-off between the corporate goals and the community’s welfare, in other words show these objectives may be influenced by the assigned importance to the social welfare as its shown in the Figure 5 Trade-off for organizations (Thomas & Cross, 2007)

Figure 5 Trade-off for organizations (Thomas & Cross, 2007)

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To understand the how organizations deal with this trade-off, authors of ‘Organizations as Place Builders’ propose the ‘Agent Perspective’ as a way to measure the level of independence that organizations have with the place where they are location (Thomas and Cross, 2007). According to this approach, for every organization there are two possible types of perspectives:

• Interdependent perspective, this term refers to those kinds of corporation that perceives the relationship between social welfare and business success is mutually inclusive. The interdependent perspective understands the organizations as part of the community where the corporation is established creating a deep organizational commitment that seeks for actively maximize the well-being of a place, this is understood by the mutual dependence for success, where the corporations can’t stand alone the upcoming challenges, and then they does not work to achieve community’s objectives but along the community an member that actively looks after for opportunities to improve the conditions that will brings benefits for both parts.

• Independent perspective, this term refers to those kinds of corporation that perceives the relationship between social welfare and business success is not related at any point. Aversely to the interdependent perspective, independent corporations does not embrace a positive correlation in the potential economic and social earning. Thus, independents organizations act as merely external tenant or users of the place where they develop their activities, they are exclusive concern about reaching their internal objectives and corporate shareholders’ demands.

There is no commitment of these corporations with the community of the place where they are settled, a mutual cooperation relationship between locals and the independent organization may only arise at some point if the interests of the corporations seem threatened by not having this connection with the local agents or if there’s a way to obtain any kind of benefits for the shareholders by developing this relation.

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Agents perspective allows to understand the position of the organizations regarding the local communities’ interests and how their corporate objectives may be affected for these decisions, usually companies utilize corporate social responsibility to go through this positioning and to achieve their self-imposed duties with the community (Lindgreen et al., 2009).

Later, the final outcome between the social and economic interaction will depends certainly on the independence level of the organization and how the corporate objectives are balanced with the level of involvement of the corporation (Thomas and Cross, 2007).

Despite the outcome may seems uncertain and subject to many variables ‘place builder’

approach provides a model to make an objective evaluation of long-term corporate objectives and culture, that at last will define the organizations’ identity. There have been identified four different types of organizations or ‘place agent identities’, these identities will contextualize the role of the company and can be grouped as is shown in the Figure 6.

Figure 6 Four Types of Place Builders and Their Corporate Priorities (Thomas & Cross, 2007)

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1.2.3.1 Transformational organizations

As can be seen in Figure 6, these organizations prioritize place well-being over the fiscal internal-business success. They identify themselves as social changing actors that seeks for the improvement of the conditions in a of the entire society and push changes in their behaviour or culture, assuming the role of responsible for these improvements to happens.

They have an interdependent perspective, and their corporate objectives are aligned with meaningful goals for the place where they are settled (Thomas and Cross, 2007). Hence, the entire organizational culture is focused on developing an open and strong rounded relationship with local organizations, this involves educating and training their corporate’s workforce to internalize and transmit the company’s mindset to clients contributing effectively to the development of the place while the organization also benefits at the same time.

The accountability for these organizations pushes their organizational objectives way beyond from current regulations or industries common culture, the integrative view of society is assimilated by each participant of the system in an effort to provoke a positive impact in the place as a whole. One clear example or this engagement is when organizations work with universities or schools in long-term agreements to develop qualified workforce required for the industry or to develop innovative projects according to improve internal company’s processes. Usually these agreements includes clauses for the management of patents, quotas for the incorporation of local labour, among others, and the company involve themselves as responsible of the success of these initiatives, therefore is a common practice to include their own staff within these learning processes along with including the accomplishment of these programs in their own corporate objectives (Lutchen, 2018).

The involvement of the company in these educational organizations will help the organization to improve their business performance at the same time that provides resources, research and development opportunities to their partners, but also helping to

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generate important spaces to improve the employability, raising community participation along the company and enhancing the quality of life of the environment of the corporation.

This common ground helps to cultivate intimate relationships among corporations and institutions, spots of mutual benefits and dependence to achieve the success in their final outcomes. This is out, the corporative culture of transformational organizations applies to every dimension of the place as was stated in the ‘organizations as Place builders’ model developed by the Thomas & Cross (Figure 4), where natural environment, material environment and cultural/social relations converge on a common point so-called ‘place’, in this stage organization that acts as interdependent with their environment and gives more importance to the well-being of the place rather their own internal success, holds a transformational meaning.

1.2.3.2 Contributive organizations

As can be seen in Figure 6, these organizations assign the same importance to the place well-being and to the fiscal internal/business success. They identify themselves as a promoting agent of social welfare among the local community, their interdependent perspective develops a corporate business network that seeks for shared common goals between the organizations and the place where they are located (Thomas and Cross, 2007).

Unlike the transformational organizations, contributive organizations do assume a not change agents’ role for the well-being of the community where they are located but defined themselves as key member of the place, main contributors or investors, cultivating a culture where the company focuses on generating good returns towards the place where it operates, but always within the framework of the rules and obligations established by the local premises.

The improvement of the conditions in their locations is still an important asset to the company and the social relationship is a requirement that must be satisfied in order to keep running their operations (Banning and Thomas, 2014). The place will not necessarily play a

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relevant role in their processes, and it may remain as agent that receives benefits from the organization and would be worse off without the organization located there. Nevertheless, for contributive organizations after accomplishing the required social relationship with the local communities arises the possible business opportunities, their have an interdependent perspective, and their corporate objectives are focused to achieve the best performance for their internal goals and to fulfil the community demands, usually aligned with the legal local requirements, of the place where they are located.

Hence, the entire organizational culture is focused on developing a relationship with local organizations and care about their need but acting as agents that contribute towards satisfying community needs, their corporate’s workforce internalizes and transmit the company’s mindset to clients contributing to the development of the place as long as the organization is able to achieve their internal objectives.

‘That’s why we have businesses to improve people’s lives, to improve the customer’s life’

(Thomas and Cross, 2007) this very interesting point of view considers peoples of the community as a potential customers resumes very well the end goals of contributive organizations, where the interest of these organizations to keep the environment satisfied it’s related to the potential of locals to benefits their business, by attracting more customers or turning current customers into more loyal ones.

The contributive organizations acts in every of the three realms of place, proposed in the Figure 4, always guided by a culture that seeks to maintain the balance between their organizational objectives and the welfare of the local community. They position themselves as key contributor to the place where they are located valuating the characteristics that makes that places important among others (natural environment), the human-built resources that allows the place to have a good life with access to organizations and services by having the proper infrastructures available for their citizens (material environment) and the promoting the social responsibility the place (Stonehouse and Houston, 2003). At this

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point the organizations acts as interdependent with their environment but keeping their internal goals at the same levels of importance as the well-being of the place.

1.2.3.3 Contingent organizations

As can be seen in Figure 6, these organizations assign more importance to the fiscal internal/business success than the place well-being. They identify themselves as a merely participant among the local community where their contribute to activities/events only when there is a specific gain for the organization. Unlike the transformational and contributive organizations, contingent organizations have and independent perspective, so they perceive themselves as autonomous agents not depending on the place where they are located. Their role in the well-being of the local community, is strictly aligned with the legal and compulsory laws, rules and obligations established by the local authorities for all companies, that is, the corporation does not go beyond what is strictly necessary.

The improvement of the conditions in their locations is considered just as a tool that helps the corporation to keep their processes running and the way that contingent organizations can achieve their own internal goals. The place will not play a relevant role in their processes and will be treated as a must to keep satisfied as long as they represent a specific benefit to the internal corporate goals, the place will be benefited from the organization accordingly to the gains that can be obtained by caring of the community or corporate social responsibility initiatives that the corporation have to implement due to regulations(Kimball and Thomas, 2012).

Contingent organizations are usually committed with the local organism in order to avoid any possible conflict between the corporation and the place that might impact their operations. It’s common that these organizations possess a specialized area that are constantly looking for possible threads to the operation, taking care for the complains that the community can make about the operation of the firm(Sheehy, 2015). Therefore, the

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entire organizational culture is focused on developing a stable relationship with local organizations working on build a good image and friendly behaviour of the organizations with their communities.

For these cases, usually the firm ‘…prefers to be seen as the employer of choice and as a good corporate citizen…’ (Thomas and Cross, 2007) this statements positions the organizations in a power position regarding their economic power. The contingent organizations will keep investing in the local community because it is necessary to be a good

‘neighbour’, the corporation know that if they do not keep local need satisfied or general customers will choose to not buy product or services to the organization.

As well as the two previous interdependent organizations, contingent organizations act in every of the three realms of place, proposed in the Figure 4, but guided by a culture that limits their corporate social responsibility to obeying local, labour, environmental and international regulations, promoting ethical behaviour and their own internal goals. The participant position embraced by contingent organizations value the different dimensions of the ‘place builder’ model as resources to keep their operations running; the social dimension is value because provides the workforce required to produce and achieve their internal goals.

On the other hand, the material environment valuation is linked with one main idea;

maximize their business success (profit), this usually involves minimizing of their labour costs by having cheap workforce with very low rotation and reducing their financial duties (such as taxes) by contributing to the community need, relying on laws that usually reduce the taxes of companies that finance or carry out activities related to improving the well-being of localities (Knuutinen, 2014). In addition to the human resources required for production activities, this organizations also considers the natural environment as the resources required for production activities. As a whole, these organizations try to achieve the most basic requirements with their place.

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1.2.3.4 Exploitative organizations

As can be seen in Figure 6, these organizations assign total relevance to the fiscal internal/business success, being organization profit-oriented and industry centered, considering well-being of the place as a commodity. They identify themselves as independent agents among the local community where utilizes place’s resources to maximize the profit of the organization. Alike the contingent organizations, exploitative organizations have and independent perspective but, in this case, it is taken to the very limit where this kind of organizations are willing to take the resources from a place without worrying about the possible consequences that it may carry to their population (Thomas and Cross, 2007). Equally, these kinds of corporations are not committed at any point with the risk management that their operations may bring to the locals, their accountability is almost null and the entire area where they are located is seems as disposable.

Exploitative organizations position themselves as total autonomous agents that does not depends, at any point, on the place where they are located. Their role in the well-being of the local community, is very poor, most of the time it is limited to include some local workforce in their staff or buying to local providers but there is no long-term goal to invest or care about the community. Either, these corporation keep their business strategy and strategic goals aligned with the maximization of profit, there are no relation of their strategic interest with the corporate social responsible or local requirements (Banning and Thomas, 2014).

Of all the above kind of organizations, these ones can be considered the most controversial ones. In many cases they enjoy a privileged position owning a big share of the market, despite this their common practices about taking advantages of the local market at any cost, usually pushes the well-being of the place downside and creates a poor reputation to the company. Common cases for this classification involve the predatory consumption of natural resources, large environmental effects such as pollution, deforestation or depletion

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of other natural sources, this brings immediate consequences to the local population health and a deterioration in their quality of life. This is a direct consequence of their maximizing their profit at any cost, that is also one the motives that organizations holds to establish and stay in a certain place (Sahil Baloch, 2019), if at some point the local communities obstructs their regular operations or harms their internal objectives, specially their profit, these organizations may evaluate to leave their current place and look for another that offers better economic-business perspective.

As well as the three previous interdependent organizations, exploitative organizations act in every of the three realms of place, proposed in the Figure 4, but guided by a culture that seeks to achieve their internal goals only. By acting as a merely external user of the place where there are located, exploitative organizations value all the different dimensions of the

‘place builder’ model just as far as they can take advantage from any of those resources in order to fulfil their own interest.