session 1_oranization effectiveness
DESCRIPTION
Session 1_Oranization EffectivenessTRANSCRIPT
ORGANIZATIONAL EFFECTIVENESS
HISTORICAL OPINIONS ABOUT ORGANIZATIONAL
EFFECTIVENESS
1. FREDERICK TAYLOR2. HENRI FAYOL3. ELTON MAYO
FREDERICK TAYLOR
EFFECTIVENESS WAS DETERMINED BY FACTORS SUCH AS PRODUCTION
MAXIMIZATION, COSTMINIMALIZATION, TECHNOLOGICAL
EXCELLENCE, Etc.
HENRI FAYOL
EFFECTIVENESS IS A FUNCTION OF CLEARAUTHORITY AND DISCIPLINE WITHIN AN
ORGANIZATION
ELTON MAYO
EFFECTIVENESS IS A FUNCTION OF PRODUCTIVITY RESULTING FROM
EMPLOYEE SATISFACTION
NEARFUTURE
INTERMEDIATEFUTURE
DISTANTFUTURE
TIME
DIMENSIONApprox.1 year
Approx. 5 years
EFFECTIVENESS
CRITERIA
The organizationmust be1. EFFECTIVE in
accomplishing its purpose(s)
2. EFFICIENT in the acquisition and use of scarce resources
3. A SOURCE OF SATISFACTION
to its owners, employees, customers and clients, and society.
The organization must be4. ADAPTIVE to new opportunities and obstacles5. CAPABLE OF DEVELOPING the ability of its members and of itself
The organizationmust be6. CAPABLE OF SURVIVAL in a world of uncertainties.
ORGANIZATIONAL EFFECTIVENESS
MEETING ORGANIZATIONAL OBJECTIVES ANDPRVAILING SOCIETAL EXPECTATIONS IN THE
NEAR FUTURE, ADAPTING AND DEVELOPING INTHE INTERMEDIATE FUTURE, AND SURVIVING
IN THE DISTANT FUTURE.
APPROACHES TO MEASURING ORGANIZATIONAL EFFECTIVENESS
• Goal Approach: Effectiveness is the ability to excel at one or more output goals.
• Internal Process Approach: Effectiveness is the ability to excel at internal efficiency, coordination, motivation, and employee satisfaction.
• System Resource Approach: Effectiveness is the ability to acquire scarce and valued resources from the environment.
Approaches to Measuring Org. Effectiveness, continued
• Constituency Approach: Effectiveness is the ability to satisfy multiple strategic constituencies both within and outside the organization.
• Domain Approach: Effectiveness is the ability to excel in one or more among several domains as selected by senior managers.
Flow Charts of Approaches to Organizational Effectiveness –
Goal Approach
TRANSFORMATIONINPUTS OUTPUTS
GOAL APPROACH
Flow Charts of Approaches to Organizational Effectiveness –
Internal Process Approach
TRANSFORMATIONINPUTS OUTPUTS
INTERNAL PROCESS APPROACH
Flow Charts of Approaches to Organizational Effectiveness –
System Resource Approach
TRANSFORMATIONINPUTS OUTPUTS
SYSTEM RESOURCE APPROACH
Flow Charts of Approaches to Organizational Effectiveness –
Constituency Approach
TRANSFORMATIONINPUTS OUTPUTS
STRATEGIC CONSTITUENCIES APPROACH
COMPARISON OF THE FOUR OE APPROACHES
Approach Definition When Used
An organization is effective Preferred when: to the extent that:
Goal attainment it accomplishes its stated goals goals are clear, time bound and measurable
System Resource it acquires needed resources a clear connection exists between inputs and outputs
Constituencies all strategic constituencies constituencies have powerful are at least minimally influence on the organization, satisfied and the organization must respond to demands
Internal Processes combines internal efficiency costs, outputs & satisfaction and affective health are easily measurable
OE Criteria for Selected Constituencies
Constituency Typical Criteria
Owners Return on Investment; growth in earnings Employees Compensation; fringe benefits; job satisf. Customers Satisf. w/price, quality, service Suppliers Satisf. w/payments, future sales Creditors Satisf. w/debt payments Unions Satisf. w/competitive wages & benefits; satif. working conditions, fairness in bargaining Local Communities Involvement in local affairs; environmental damage Government Agencies Compliance w/laws, avoidance of penalties
The Contradictions Model of Organizational Effectiveness
The idea of trying to characterize a whole organization as totally effective or ineffective is problematic. In any complex
organization there may be parts of the organization that functionwell and suggest effectiveness while other aspects of that same
organization perform poorly.
Four Central Assumptions of the Contradictions Model
1. Organizations face complex environments that place multiple and conflicting demands and constraints on them. It may not be possible to succeed in meeting all the environmental conditions an organization faces.2. Organizations have multiple, conflicting goals. It is impossible to maximize achievement of all goals.3. Organizations face multiple internal and external stakeholders or constituent groups that make competing or conflicting demands. It may be impossible to satisfy all groups of people who express interest in a company.4. Organizations must manage multiple and conflicting time demands. Satisfying short- or long-term demands at the expense of the other may result in sub-optimal performance.
Competing Values Model
Organizational goals and performance are defined by top and middle management. By
comparing the diverse effectiveness indicators used by managers and researchers, Quinn & Rohrbaugh looked for underlying similarities
and found underlying dimensions of effectiveness criteria that reflected competing management
values in organizations.
Competing Values Dimensions I
Focus: whether dominant values concern issues that are internal to the organization or external to it.
Internal focus reflects management concern for well-beingand efficiency of employees. External focus reflects anemphasis on the well-being of the organization itself and its“fit” with its environment.
Competing Values Dimensions IIStructure: whether stability versus flexibility is the dominant structural consideration.
Stability reflects a management value for efficiencyand top-down control, while flexibility representsa management value for learning and change.
Dimensions of EffectivenessStructureFlexibility
Control
Focus Internal External
I II
III IV
Four Models of Effectiveness
Quadrant I : Human Relations Model – internalFocus and flexible structure. Managementconcern is on the development of humanresources. Employees are given opportunitiesfor autonomy and development. Managementworks toward sub-goals of cohesion, morale, andtraining opportunities. Organizations using thisare more concerned with employees than theenvironment.
Four Models of Effectiveness IIQuadrant II: Open Systems Model – Combinationof external focus and flexible structure. Management’s goals are primarily growth andresource acquisition. Sub-goals are flexibility,readiness, and positive evaluation by the externalenvironment. Dominant value is establishinga good relationship with the external environmentto grow and acquire resources. Similar to theSystems Resource Model.
Four Models of Effectiveness IIIQuadrant III: Internal Process Model – Reflectsthe values of internal focus and structuralcontrol. Seeks a stable organizational setting thatmaintains itself in an orderly way. Wellestablished in environment and just wish to keeptheir current position. Sub-goals includemechanisms for efficient communication,information management, and decision-making.
Four Models of Effectiveness IVQuadrant IV: Rational Goal Model – ReflectsManagement values of structural control andexternal focus. Primary goals are productivity,efficiency, and profit. Organization wants toachieve output goals in a controlled way.Sub-goals include internal planning andgoal-setting, which are rational managementtools. Similar to the Goal Approach.
Competing Values
Four different opposing value sets within theorganization. Exist simultaneously, and the“right” balance for the organization is subjectto managerial discretion.
Emphasis may change over time, especially as theorganization evolves through its life cycle.
Examples: hospitals, airlines