Organizational Effectiveness

 

 

Organizational effectiveness

Organizati Organi zationa onall effect effective ivenes nesss is the concep conceptt of how effective  effective  an organization is in achieving the outcomes the the or org ganiz anizat atio ion n in inte tend ndss to pr prod oduc uce. e. The The id idea ea of  organizati orga nizational onal effectiveness effectiveness is especially especially important important for non-profit organizations  organizations  as most mo st pe peop ople le who who do dona nate te money money to no nonn-pr prof ofit it or orga gani niza zati tion onss an and d ch chari ariti ties es ar aree interested in knowing whether the organization is effective in accomplishing its goals. An organization's effectiveness is also dependent on its communicative competence an and d ethi ethics. cs. The The relat relatio ions nshi hip p be betw twee een n th these ese th three ree is simu simulta ltane neou ous. s. Ethi Ethics cs is a foundation found within organizational effectiveness. An organization must eemplify respect! honesty! integrity and e"uity to allow communicative competence with the  participating members. Along with ethics and communicative competence! members in that particular group can finally achieve their intended goals. #oundations  and other #oundations  other source sourcess of grants and other types of funds are interested in organizational effectiveness of those people who seek funds from the foundations. #ounda #ou ndatio tions ns alway alwayss have have more more re"ues re"uests ts for funds or fundin funding g  proposals and treat funding as an investment using investment using the same care as a venture capitalist would capitalist would in picking a company in which to invest. Organizational effectiveness is an abstract concept and is basically impossible to measu me asure. re. $nst $nstead ead of meas measur urin ing g or orga gani nizat zatio ional nal ef effe fecti ctive vene ness! ss! th thee or orga gani niza zati tion on determ det ermine iness proy proy measure measuress which which will will be used used to represe represent nt effect effective iveness ness.. %roy %roy measures used may include such things as number of people served! types and sizes of   population segments served! and the demand within those segments for the services the organization supplies. #or instance! a non-profit organization which supplies meals to house bound people bound people may collect statistics such as the number number of meals cooked and served! the number number of  volunteers   delive volunteers deliverin ring g meals! meals! the turnov turnover er and retention retention rates rates of volunt volunteer eers! s! the demographics of the people served! the turnover and retention of consumers! the number of re"uests for meals turned down due to lack of capacity &amount of food! capacit cap acity y of meal meal prepar preparati ation on facilit facilities! ies! and number number of delive delivery ry volunt volunteers eers! ! and amount of wastage. (ince the organization has as its goal the preparation of meals and the delivery of those meals to house bound people! it measures its organizational effe effect ctiv iven eness ess by tryin trying g to de dete term rmin inee what what ac actu tual al ac acti tivi viti ties es th thee pe peop ople le in th thee organization do in order to generate the outcomes the organization wants to create. Activi Acti viti ties es such such as fundraising  fundraising  or volunt volunteer eer trainin training g are import important ant because because they  provide the support needed for the organization to deliver its services but they are not the outcomes per se. These other activities are overhead activities which assist the organization in achieving its desired outcomes. The term The term Orga Organi niza zati tion onal al Ef Effe fect ctiv iven enes esss is of ofte ten n us used ed in inte terc rcha hang ngea eabl bly y wi with th Organization )evelopment! )evelopment! especially when used as the name of a department or a  part of the *uman +esources function +esources function within an organization.

 

To be effective and achieve its goals! an organization must successfully respond to environmental factors. *ow can the effectiveness of an organization be measured, ariou riouss mode models ls of dete determ rmin inin ing g or orga gani niza zati tion onal al ef effe fect ctiv iven enes esss e eis istt be beca caus usee organi org anizat zation ionss face differ different ent enviro environme nments! nts! they produc producee differ different ent produc products! ts! their  their  orga organi niza zati tion onal al memb member erss ar aree made made up of diff differ eren entt ki kind ndss of pe peop ople le!! an and d th thee organizations are at different stages of development. Each model is most useful to an orga organi niza zati tion on havi having ng a part partic icul ular ar com combina binati tion on of th thes esee en envi viro ronm nmen enta tall an and d organizational attributes. Two different Two different underlying dimensions  may be consid considered ered to develo develop p models models of  organizational effectiveness. The first is the organizations internal versus eternal focus. The second dimension dimension is the organization organizationss emphasis emphasis on fleibility fleibility versus control. #leibility allows faster change! whereas control allows a firmer grasp on current operations. /hen these two dimensions are drawn at right angles to each other! the first four models of organizational effectiveness can be plotted. They are the rational goal! open system! internal process! and human relations models.

According to the rational goal model of effectiveness! an organization is effective to the etent that it accomplishes its stated goals. #or eample! the formal goals of the Toronto 0lue 1ays are to win their division! the American 2eague pennant! and the /orld (eries. /ith an open system model an organization is effective to the degree that it ac"uires inputs inp uts from from its enviro environm nment ent and has output outputss accept accepted ed by its enviro environme nment. nt. The The 3niversity of Alberta follows this model when it is concerned about the "uality and number of students applying for admission and what 4obs they receive on graduation. The int focu cuse sess on th thee ef effe fect ctiv iven enes esss of th thee in inte tern rnal al inter ernal nal proc process ess model model  fo transfor tran sformat mation ion process process.. /hen /hen *amilt *amilton onss (telco (telco $nc. $nc. eamin eamines es its steel-m steel-maki aking ng methods to determine price and "uality competitiveness! it is focusing on its internal  processes. The human relatio focusess on the develo developme pment nt of the organi organizat zation ions s relations ns model model  focuse  personnel. 5arlin Travel sends its agents on familiarization trips to epand their  knowledge of specific hotels! cruises! and destinations. The competing values model   re"uires that an organization scrutinize the balance among the above four effectiveness models. $n this model there are three sets of  competing values. The first is the tension between internal versus eternal focus. The more the organization focuses on one! the less it can concentrate on the other. #or  eample eam ple Apple pple 6omput 6omputer er has focused focused etern eternally ally on its custom customers ers and making making computers that are intuitive and easy to use. The computer chip maker $ntel has had a more internal focus on how to make faster and more powerful central processing units at a low price. The second set of values in competition is fleibility versus control. #leibility allows "uick response to changing conditions and values innovation.

 

6ontrol values the opposite. (tability and predictability mean that routine activities are performed well but change is more difficult. The third set of competing values is the relative concern with the feelings! needs! and developme development nt of the people people making making up the organization versus the organization and its re"uirement to accomplish its tasks. A private hospital! for example! is concerned with how patients are treated and the success rate of surgeries &the rational goal model. $t is also interested in how hospital  procedures are performed &the internal process model and with the skills and abilities of hospital staff &the human human relations relations model. model. #inally! #inally! because it is a private private hospital hospital and must make a profit to survive! it needs to take into account how many and what kinds of patients are admitted &the open system model. The hospital must balance the three sets of competing values in order to be effective. /ith the the strateg orga gani niza zatio tion n woul would d aim to at le least ast strategic ic constituencies constituencies model  an or minimally satisfy the most important constituents &or stakeholders in its environment. The owner of an A7/ franchise must satisfy the customers and A7/ head office management. 6ustomers care about the "uality and price of the food as well as the speed and friendliness of service. *ead office cares about these issues along with financi finan cial al repor reporti ting ng!! pr prod oduc uctt pr prom omot otio ions ns!! an and d th thee stor store ess relat relatio ions nshi hip p wi with th its its community. An organi organizati zation on seekin seeking g legiti legitimacy macy surviv survives es by acting acting in a manner manner seen by other  other  organizations as legitimate. An eample would be producing a business plan and  pro4ected income statement in order to obtain a bank loan. The organization adopting the fault-driven model of effectiveness seeks to eliminate traces of ineffectiveness in its internal functioning. The 8ational Aeronautics and (pace Administration &8A(A in the 3nited (tates is a good eample. $ts systems are designed with backups to be reliable even if some components fail. #inally! the organization as a high performing system compares itself to other similar  organizati orga nizations. ons. The ancouver ncouver (ymphony (ymphony Orchestra can measure measure ticket sales and customer satisfaction with performances. 0ut to determine the "uality of the orchestra itself! comparison is made to other orchestras in the world. Effectiveness is seen as the degree to which that comparison is positive. One method used by high performers to make ma ke such such co comp mpari ariso sons ns is to e eam amin inee in indu dust stry ry ra rank nkin ings gs.. An e eam ampl plee is th thee 5ac2eans magazine ratings of 6anadian universities. Organizational Effectiveness Approaches The creative change biz approach

5any company company leader leaderss scratch scratch their their heads heads over over the diffic difficult ulty y of implem implementi enting ng technical and process improvements. Are you one of those leaders, )o your change initiatives get sidetracked or altogether de-railed,

 

)o you "uietly declare victory and move on to another change initiative, /hether  they are a relatively modest effort such as a new order fulfilment system! or computer  aided product design! or wholesale changes to your product development process! change is tough for you and your employees. /ould you like to increase the success rate of your change initiatives, /e offe offerr you an oppo opport rtun unit ity y to do 4ust 4ust th that at.. As Orga Organi niza zati tion on an and d (yst (ystem emss )evelopment eperts! we offer a systemic framework for understanding your business challenges! and as eperienced coaches! we can offer you on-going coaching support. $n our work with organizations! we apply a systems view of our clients that greatly improves the success of your change initiative. /e use a model that employs the  proverbial three-legged stool9 ---:%eople ---: %rocess ---: Technology ---:

•

People: includes formal structures! informal relationships! and organizational culture Process:  in incl clud udes es manu manufac factu turi ring ng an and d bu busi sine ness ss ac acti tivit vitie iess such such as 2ean 2ean

•

Thinking and (i (igma Technology: includes computers! robots! etc.

•

/hile it isn't always apparent to managers and leaders! implementing new %rocesses and Technology always forces a culture change and "uite often changes in structures and organizational power relationships. Organizational leaders are more often than not! naive about the impact of the %rocess and Technology ;improvements; to their  organizations. #or eample9 a utility company we worked with implemented a new computerized order fulfilments system. Employees resisted the change because the new system completely upended the formal and informal power hierarchy among order fulfilments technicians