Which theory provides specific directions on how organizational forms should be created and managed?

The correct answer is Prescriptive theory. This theory is characterized by its focus on establishing guidelines, principles, and models for designing and managing organizational structures. Unlike descriptive theories, which aim to explain or describe existing patterns and behaviors without providing instructions, prescriptive theories offer specific recommendations on how organizations should ideally operate.

In the context of organizational forms, prescriptive theory outlines clear standards and frameworks that can help leaders and managers effectively create and manage their organizations. This foresight helps in developing frameworks that enhance efficiency, effectiveness, and adaptability in various organizational contexts.

Empirical theory is more concerned with deriving conclusions from observed data and experiences rather than prescribing how organizations should be structured. Descriptive theory focuses on detailing and understanding existing organizational realities without suggesting changes or improvements. Critical theory often interrogates power structures and social inequalities within organizations rather than providing a roadmap for organizational management. Thus, Prescriptive theory stands out as the one that directly addresses the creation and management of organizational forms with specific direction.