ORGANIZATIONAL EFFECTIVENESS

HISTORICAL OPINIONS ABOUT ORGANIZATIONAL EFFECTIVENESS
1. FREDERICK TAYLOR 2. HENRI FAYOL 3. ELTON MAYO

TECHNOLOGICAL EXCELLENCE. . Etc.FREDERICK TAYLOR EFFECTIVENESS WAS DETERMINED BY FACTORS SUCH AS PRODUCTION MAXIMIZATION. COST MINIMALIZATION.

HENRI FAYOL EFFECTIVENESS IS A FUNCTION OF CLEAR AUTHORITY AND DISCIPLINE WITHIN AN ORGANIZATION .

ELTON MAYO EFFECTIVENESS IS A FUNCTION OF PRODUCTIVITY RESULTING FROM EMPLOYEE SATISFACTION .

1 year INTERMEDIATE FUTURE DISTANT FUTURE Approx. CAPABLE OF A SOURCE OF DEVELOPING SATISFACTION the ability of its to its owners. 5 years The organization must be 1. CAPABLE OF SURVIVAL in a world of uncertainties. EFFECTIVE in The organization accomplishing its must be purpose(s) EFFICIENT in the 4. . 3.TIME DIMENSION NEAR FUTURE Approx. members and of employees. ADAPTIVE to new opportunities acquisition and use and obstacles of scarce resources 5. itself customers and clients. The organization must be 6. and society. EFFECTIVENESS CRITERIA 2.

ADAPTING AND DEVELOPING IN THE INTERMEDIATE FUTURE. AND SURVIVING IN THE DISTANT FUTURE. .ORGANIZATIONAL EFFECTIVENESS MEETING ORGANIZATIONAL OBJECTIVES AND PRVAILING SOCIETAL EXPECTATIONS IN THE NEAR FUTURE.

and employee satisfaction. . ‡ Internal Process Approach: Effectiveness is the ability to excel at internal efficiency. motivation.APPROACHES TO MEASURING ORGANIZATIONAL EFFECTIVENESS ‡ Goal Approach: Effectiveness is the ability to excel at one or more output goals. ‡ System Resource Approach: Effectiveness is the ability to acquire scarce and valued resources from the environment. coordination.

‡ Domain Approach: Effectiveness is the ability to excel in one or more among several domains as selected by senior managers. continued ‡ Constituency Approach: Effectiveness is the ability to satisfy multiple strategic constituencies both within and outside the organization. Effectiveness. .Approaches to Measuring Org.

Flow Charts of Approaches to Organizational Effectiveness ± Goal Approach INPUTS TRANSFORMATION OUTPUTS GOAL APPROACH .

Flow Charts of Approaches to Organizational Effectiveness ± Internal Process Approach INPUTS TRANSFORMATION OUTPUTS INTERNAL PROCESS APPROACH .

Flow Charts of Approaches to Organizational Effectiveness ± System Resource Approach INPUTS TRANSFORMATION OUTPUTS SYSTEM RESOURCE APPROACH .

Flow Charts of Approaches to Organizational Effectiveness ± Constituency Approach INPUTS TRANSFORMATION OUTPUTS STRATEGIC CONSTITUENCIES APPROACH .

outputs & satisfaction are easily measurable System Resource it acquires needed resources Constituencies all strategic constituencies are at least minimally satisfied Internal Processes combines internal efficiency and affective health . and the organization must respond to demands costs.COMPARISON OF THE FOUR OE APPROACHES Approach Definition An organization is effective to the extent that: Goal attainment it accomplishes its stated goals When Used Preferred when: goals are clear. time bound and measurable a clear connection exists between inputs and outputs constituencies have powerful influence on the organization.

avoidance of penalties . job satisf. w/debt payments Satisf. fairness in bargaining Local Communities Involvement in local affairs. w/price. satif. w/payments. service Satisf. quality.OE Criteria for Selected Constituencies Constituency Owners Employees Customers Suppliers Creditors Unions Typical Criteria Return on Investment. fringe benefits. Satisf. w/competitive wages & benefits. growth in earnings Compensation. environmental damage Government Agencies Compliance w/laws. future sales Satisf. working conditions.

.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 function well and suggest effectiveness while other aspects of that same organization perform poorly.

conflicting goals.Four Central Assumptions of the Contradictions Model 1. Organizations have multiple. 3. Organizations face multiple internal and external stakeholders or constituent groups that make competing or conflicting demands. It is impossible to maximize achievement of all goals. Satisfying short. 2. 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.or long-term demands at the expense of the other may result in sub-optimal performance. It may be impossible to satisfy all groups of people who express interest in a company. Organizations must manage multiple and conflicting time demands. . 4.

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.

Internal focus reflects management concern for well-being and efficiency of employees.Competing Values Dimensions I Focus: whether dominant values concern issues that are internal to the organization or external to it. External focus reflects an emphasis on the well-being of the organization itself and its ³fit´ with its environment. .

Competing Values Dimensions II Structure: whether stability versus flexibility is the dominant structural consideration. while flexibility represents a management value for learning and change. Stability reflects a management value for efficiency and top-down control. .

Dimensions of Effectiveness Structure Flexibility I Focus Internal II External III Control IV .

and training opportunities. Management works toward sub-goals of cohesion. .Four Models of Effectiveness Quadrant I : Human Relations Model ± internal Focus and flexible structure. Organizations using this are more concerned with employees than the environment. morale. Management concern is on the development of human resources. Employees are given opportunities for autonomy and development.

. Sub-goals are flexibility.Four Models of Effectiveness II Quadrant II: Open Systems Model ± Combination of external focus and flexible structure. Dominant value is establishing a good relationship with the external environment to grow and acquire resources. Management¶s goals are primarily growth and resource acquisition. and positive evaluation by the external environment. Similar to the Systems Resource Model. readiness.

Seeks a stable organizational setting that maintains itself in an orderly way. Sub-goals include mechanisms for efficient communication. and decision-making. information management. .Four Models of Effectiveness III Quadrant III: Internal Process Model ± Reflects the values of internal focus and structural control. Well established in environment and just wish to keep their current position.

Primary goals are productivity. Organization wants to achieve output goals in a controlled way. Sub-goals include internal planning and goal-setting. efficiency. . which are rational management tools. Similar to the Goal Approach. and profit.Four Models of Effectiveness IV Quadrant IV: Rational Goal Model ± Reflects Management values of structural control and external focus.

Emphasis may change over time. Exist simultaneously. and the ³right´ balance for the organization is subject to managerial discretion. especially as the organization evolves through its life cycle.Competing Values Four different opposing value sets within the organization. Examples: hospitals. airlines .

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