Environmental munificence is constituted by “the scarcity or abundance of critical resources” over which organizations have little direct control (Castrogiovanni 1991, 452). A high degree of munificence is therefore typically thought to buffer organizations from environmental pressures because it generates financial and organizational slack that can, if used effectively, facilitate both organizational stability and growth (Cyert and March 1963; Dess and Beard 1984). Organizations operating in a highly munificent environment can afford to deliver more and better provisions, as well as hire better quality staff, whereas organizations facing a less resource rich context may confront a material restriction on their responsiveness, effectiveness, hiring practices and the range of discretionary services they can offer (Boaden and Alford 1969).
Environmental munificence is constituted by “the scarcity or abundance of critical resources” over which organizations have little direct control (Castrogiovanni 1991, 452). A high degree of munificence is therefore typically thought to buffer organizations from environmental pressures because it generates financial and organizational slack that can, if used effectively, facilitate both organizational stability and growth (Cyert and March 1963; Dess and Beard 1984). Organizations operating in a highly munificent environment can afford to deliver more and better provisions, as well as hire better quality staff, whereas organizations facing a less resource rich context may confront a material restriction on their responsiveness, effectiveness, hiring practices and the range of discretionary services they can offer (Boaden and Alford 1969).
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