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Management: Meaning and Concept of Stress

Stress in Organization, Management of Stress Power and Politics in Organization: Nature & Concepts,

Sources & Types of Power, Techniques of Politics.

Organizational Change & Development: Meaning &

Definition, Change Agents, Change Models, Resistance to


Learning Organization: Meaning & Definition, Creating a

Learning Organization.

Organizational Culture: Meaning & Concept

Cultural Differences & Business Ethics

Meaning Factors

influencing stress Early warning signs of stress Causes of stress Symptoms of stress Kinds of stress Why prevent work stress Stress control- ABC Stragey Stress Management Techniques

What is Work Stress?


harmful physical and emotional responses that occur when the requirements of a job do not match the capabilities, resources, or needs of the worker.

Stress is a reaction people have to pressure placed upon them and occurs when pressures exceed the individuals ability to cope.

A normal part of life Has good and bad implications Biological response to our environment Physical and mental reactions

Tensed Tired Frightened Elated Depressed Anxious Angry

The drive for success Changing work patterns Working conditions

Overwork Under-work
Relationships at work

Uncertainty Conflict Responsibility Poor Job Content: boredom, lack of meaning Organizational policies and procedures


Disturbances Difficulty in concentrating Short Temper Upset Stomach Job Dissatisfaction Low Morale


Environment Social Interaction Organisational Major Life Events Daily Hassles

Bright Heat Confined



Bossiness Aggressiveness Bullying

by others

Rules Regulations Red

- Tape Deadlines


job Promotion Marital status change


keys Mechanical breakdowns


choices Negative self - talk Mind traps Personality traits


of sleep Overloaded schedule


thinking Self criticism Over analysing


expectations Taking things personally All or nothing thinking Exaggeration Rigid thinking



symptoms Mental symptoms Behavioural symptoms Emotional symptoms


pattern changes Fatigue Digestion changes Headaches Aches and pains Infections Indigestion



& trembling Tingling hands & feet Breathlessness Palpitations Missed heartbeats


of concentration Memory lapses Difficulty in making decisions Confusion Panic attacks

Appetite changes - too much or too little Eating disorders Increased intake of alcohol & other drugs Increased smoking Restlessness Fidgeting/ Restlessness Nail biting Hypochondria (The persistent conviction that one is or is likely to become ill, often involving symptoms when illness is neither present nor likely, and persisting despite reassurance and medical evidence to the contrary)


of depression Impatience Fits of rage Tearfulness Deterioration of personal hygiene and appearance

Stress is not the same as ill-health, but has been related to such illnesses as;

disease Immune system disease Asthma Diabetes

1. NEGATIVE STRESS It is a contributory factor in minor conditions, such as headaches, digestive problems, skin complaints, insomnia and ulcers. Excessive, prolonged and unrelieved stress can have a harmful effect on mental, physical and spiritual health.

Stress can also have a positive effect, spurring motivation and awareness, providing the stimulation to cope with challenging situations. Stress also provides the sense of urgency and alertness needed for survival when confronting threatening situations.

This loss is in terms of

Absenteeism Lost productivity Poor customer service

Healthcare expenditures are close to 50% greater for stressed workers compared to non-stressed workers. Overall, stress in a business contributes to 19% absenteeism costs and 40% turnover costs.

ABC Strategy

A = Awareness
What causes your stress? How do you react?

B = Balance
There is a fine line between positive/ negative stress. How much can you cope with before it becomes negative?

C = Control
What can you do to help yourself combat the negative effects of stress?

Change your thinking Change your behavior Change your lifestyle




Assertive Get Organized/ prioritize Time Management Sharing your problem Humour Diversion and Distraction


a list What must be done What should be done What would you like to do Cut out time wasting Learn to drop unimportant activities Say no or delegate


your day Set achievable goals Dont waste time making excuses for not doing something

Smoking Exercise Leisure Relaxation

and Alcohol

Improves blood circulation Lowers blood pressure Clears the mind of worrying thoughts Improves self image Makes you feel better about yourself Increase social contact


stress reducer Difficult to cope when tired Wake refreshed after nights sleep Plenty of daytime energy

Interest Gives

you a break from stresses Provides outlet for relief Provides social contact


blood pressure Combats fatigue Promotes sleep Reduces pain Eases muscle tension



worries Increases concentration Increases productivity Increases clear thinking

Relaxation Meditation Massage Yoga

and Psychotherapy

Acupuncture Aromatherapy

Negative Copers

Smoking Drinking Illegal Drugs Blaming others Other self destructive behaviors

Positive Copers
Exercising Support groups Yoga Meditation Good Eating Habits Changing a negative attitude

Stress can be a major factor in our ability to cope with our working life. It is often thought of in a negative way as something to be avoided, something harmful, but stress cannot always be avoided and its effects are harmful only when it is handled badly.

Power is the capacity of a person, team, or organization to influence others.

The potential to influence others People have power they dont use and may not know they possess Power requires one persons perception of dependence on another person


intentional influence over beliefs, emotions and behaviors of people.

Potential power is the capacity to do so Kinetic power is the at of doing so


person exerts power over another to the degree that he is able to exact compliance as desired A has power over B to the extent that A can get B to do something that B would otherwise not do. The ability of those who possess power to bring about the outcomes they desire. The capacity to effect (or affect)

Leading Influencing Selling Persuading

Coercing Forcing Hurting



power characterized by primitive, unsocialized need to dominate others


power characterized by socialized needs to initiate, influence and lead

Seeks to dominate and control others

Seeks to empower self and others

Coercive Reward

The Bases of Power

Legitimate Expert



power depends on fear

reacts to this type of power out of fear of the negative results that might occur if one fails to comply It rests on the application (or the threat) of physical sanctions


the opposite of coercive power People comply because doing so produces benefits anyone who can distribute rewards that others value will have power over them


the power a person receives as a result of his or her position in the formal hierarchy of an organization Legitimate power is broader than the power to coerce and reward it includes acceptance of a persons authority by members of the organization


influence wielded as a result of experience, special skill, or knowledge Expertise has become a strong source of influence as the world has become more technologically oriented As jobs become more specialized, we become more dependent on experts


based on identification with a person who has desirable resources or admirable personal traits. It develops out of an admiration for someone and a desire to be like that person If person A admires person B enough to model behavior and attitudes after him or her, then person B has power over person A

Types of Individual Power: A Summary

Individual Power

Position Power Legitimate power Reward power Coercive power

Personal Power Referent power Expert power

Sources Of Power

Legitimate Reward Coercive Expert Referent

Power over Others

Contingencies Of Power

The Caine Mutiny illustrates the limits of legitimate power in organizations. Captain Queeg (Humphrey Bogart, seated left) asked his crew to do more than they were willing to follow, so they staged a mutiny.

Archive Photos


that achieves compliance based on the ability to distribute rewards that others view as valuable Coercive Power: the opposite of reward power: the power that is based on fear of negative results.

Legitimate Power

Reward Power

Coercive Power

Expert Power
Archive Photos

Referent Power


is based on special skills or knowledge


is based on possession by an individual of desirable resources or personal traits

desire to please


Sources of Power Expert Power

Consequences of Power


Referent Power Legitimate Power Reward Power Coercive Power

Resistance Compliance


to influence others using discretionary behaviours to promote personal objectives

Discretionary behaviours neither explicitly prescribed nor prohibited


may be good or bad for the organization

Extent to Which Political Activity is Likely (range 0-3)

Organizational Politics: More Likely at the Top

1.3 1.2 1.1 1.0 .9 .8 .7

Political activity is perceived to increase at higher organizational levels

(1.22) (1.07)

(.73) (.54)

.5 .4 .3



.1 Production and Clerical and Technical and Lower Middle Upper blue collar white collar professional management management management

Organizational Level

Managing impressions

Attacking and blaming

Creating obligations

Types of Organizational Politics

Controlling information

Cultivating networks

Forming coalitions

Change is inevitable and is a continuous process. All organisations are existing in a changing environment and they themselves are continuously changing.
WHY CHANGE? For change to be adapted by all the concerned people, requires adequate planning, sharing of information, generating ideas, understanding the current situation, preparation, evaluation and reinforcing.

It includes the management of changes to the

organizational culture, business processes, physical environment, job design / responsibilities, staff skills / knowledge and policies / procedures.

When the change is fundamental and radical, one might

call it organizational transformation

Any change to be effective requires some essential aspects to it. These are: Commitment Cognizance Competence Cooperation Coordination Communication

Commitment- Commitment of the top management is most important for change to be initiated. Cognizance- There should be an awareness of the change and the process being adopted in the organisation. Competence- It is essential to put into practice what is being taught. Cooperation- Cooperation of all the members of the organisation is required to bring about change in the organisation. Coordination- Coordination among all the members is essential if the organisation wants to make sure that all the members are moving in the same direction. Communication- Communication and consultation are necessary to facilitate change. The achievement of change is a joint concern of management and employees. Major changes in work arrangements.

There are two basic forms of change in organizations.

Planned change is change resulting from a deliberate decision to alter the organization. Companies that wish to move from a traditional hierarchical structure to one that facilitates self-managed teams must use a proactive, carefully orchestrated approach. Not all change is planned, however.

Unplanned change is imposed on the organization and is often unforeseen. Changes in government regulations and changes in the economy, for example, are often unplanned. Responsiveness to unplanned change requires tremendous flexibility and adaptability on the part of the organizations.

Managers must be prepared to handle both planned and unplanned forms of change in organizations.

1. 2. 3. 4. 5. 6.

Identifying need for change

Elements to be changed Planning for change Assessing change forces Change actions Feedback

Forces for change can come from many sources. Some of these are external, arising from outside the company, whereas others are internal, arising from sources within the organization.

External Forces - The four major external forces for change are globalization, workforce diversity, technological change, and managing ethical behavior are challenges that precipitate change in organizations. Internal Forces- Pressures for change that originate inside the organization are generally recognizable in the form of signals indicating that something needs to be altered. Eg. Declining effectiveness is a pressure to change. A crisis also may stimulate change in an organization. Changes in employee expectations also can trigger change in organizations. Changes in the work climate at an organization can also stimulate change.


People often resist change in a rational response based on self interest. However, there are countless other reasons people resist change. Many of these center around the notion of reactance that is, a negative reaction that occurs when individuals feel that their personal freedom is threatened. Some of the major reasons for resisting change follows:

Uncertainty- Uncertainty about the outcome of training makes people resistant to training. Fear of unknown is a strong obstacle in such a case. Fear of loss of status- When training is introduced, employees may fear losing their jobs and the fear becomes acute when advanced technology in introduced. Some people, most likely, will gain in status, job security, quality of life, etc. with the proposed change, and some will likely lose a bit. Habit- Habits, employees actions for familiar actions and events are also obstacles in training. People generally have a tendency to return to their original behaviour, a tendency that prevents training in the organization. Selective Perceptions- Perception plays an important role in shaping employees attitude and behaviour. There is a tendency for people to selectively perceive information that is consistent with their existing views of their organizations. Thus. When training takes place, workers tend to focus only on how it will personally affect them or their division. As a result, it can be difficult for an organization to develop a common platform to promote training across the organization and to get people to see the need for training in the same way.

Cognitive Biases- The cognitive biases can influence an individuals perception of a given situation and make them interpret the situation in ways that benefit themselves. People many a times believe that the proposed change is a bad idea. The risk of change is seen as greater than the risk of standing still. People feel connected to other people who are identified with the old wayWe are social species. We become and like to remain connected to those we know, those who have taught us, those with whom we are familiar. People fear they lack the competence to changeThis is a fear people will seldom admit. But sometimes, change in organizations necessitates changes in skills, and some people will feel that they wont be able to make the transition very well. They dont think they, as individuals, can do it.

People feel overloaded by changeFatigue can really kill a change effort, for an individual or for an organization. If an organization has been through a lot of upheaval, people may resist change just because they are tired and overwhelmed, perhaps at precisely the time when more radical change is most needed.

It is generally acknowledged that in an average

organization, when the intention for change is announced:

15% of the workforce is eager to accept it 15% of the workforce is dead set against it 70% is sitting on the fence, waiting to see what happens

Anticipation. The waiting stage. People really don't know what to expect so they wait, anticipating what the future holds. Confrontation. People begin to confront reality. They realize that change is really going to happen or is happening. Realization. Post change - Realizing that nothing is ever going to be as it once was. Depression. Often a necessary step in the change process. This is the stage where a person mourns the past. Not only have they realized the change intellectually, but now they are beginning to comprehend it emotionally as well. Acceptance. Acceptance of the change emotionally. Although they may still have reservations, they are not fighting the change at this stage. They may even see some of the benefits even if they are not completely convinced. Enlightenment. In Phase 6, people completely accept the new change. In fact, many wonder how they ever managed the "old" way. Overall, they feel good about the change and accept it.

Resistance to change lessened, need for change created (Equilibrium disturbed) MOVING

From old behaviour to the new (Changes)

REFREEZING Change made permanent

An effective manager...: anticipates the need for change as opposed to reacting after the event to the emergency; diagnoses the nature of change that is required and carefully considers a number of alternatives that might improve organisational functioning, as opposed to taking the fastest way to escape the problem; and manages the change process over a period of time so that it is effective and accepted as opposed to lurching from one crisis to another.

(Pugh, D. (1993). Understanding and managing change. In Maybey, C. and Mayon-White, B. (Eds.) Managing Change, Second edition. London, P.C.P.).

Leaders should anticipate resistance to any change effort, prepare for it, and make special efforts to assess and deal with individual reactions to training/change. Leaders must develop the proper attitude toward resistance to training/change and realize that it is neither good nor bad. In fact, resistance can serve as a signal that there are ways in which the change effort should be modified and improved. The following steps should help leaders faced with resistance to their change attempts:

Actively seek out people's thoughts and reactions to the proposed changes. Listen carefully. Do not launch into lengthy diatribes justifying the change - in the early stages, people are not interested in that. They want to be heard and have their concerns attended to. Recognize that it takes time to work through reactions to change.

Engage people in dialogue about the change. Leaders should do this only after fully understanding the specific concerns of others.
Involve Others


A long-term effort, led and supported by top management, to improve an organization's visioning, empowerment, learning, and problem-solving processes, through an ongoing, collaborative management of organizations culture.
Beckhard defines Organization Development (OD) as an effort, planned, organization-wide, and managed from the top, to increase organization effectiveness and health through planned interventions in the organization's processes, using behavioral-science knowledge. The practice of changing people and organizations for positive growth."

Planned. OD takes a long-range approach to improving organizational performance and efficiency. It avoids the (usual) "quick-fix". Organization-wide. OD focuses on the total system. Managed from the top. To be effective, OD must have the support of topmanagement. They have to model it, not just espouse it. The OD process also needs the buy-in and ownership of workers throughout the organization. Increase organization effectiveness and health. OD is tied to the bottom-line. Its goal is to improve the organization, to make it more efficient and more competitive by aligning the organization's systems with its people. Planned interventions. After proper preparation, OD uses activities called interventions to make systemwide, permanent changes in the organization. Using behavioral-science knowledge. OD is a discipline that combines research and experience to understanding people, business systems, and their interactions.

It emphasises goals and processes with emphasis on processes It deals with change over medium and long-term It is about people and recognises their worth It involves the organisation as a whole as well as its parts It emphasises the concept of a change agent/facilitator It uses action research as a means of intervention It is participative, drawing on theory and practices of the behavioural sciences It subscribes to a humanistic philosophy of openness It is a process of facilitation at the individual, group and organisational level It has top-management support and involvement

The volume of change in many organisations is massive The economic scene places demands on managers while they are reluctant to change from tried and tested methods The role of management is changing and new models are needed Change management takes time

Some changes challenge basic assumptions, for example, the role of supervisory staff
The need for control remains - the skill is remaining in control when so much change is going on. More comprehensive strategic pictures are needed which integrate different changes in the organisation and alleviate confusion. Organisation design and re-design are as important and necessary as product, process or system design and are the responsibility of management and people in organisations, not just specialists.

A learning organization is the term given to a company that facilitates the learning of its members and continuously transforms itself. Learning organizations develop as a result of the pressures facing modern organizations and enables them to remain competitive in the business environment. An organisation that learns and encourages learning among its people. It promotes exchange of information between employees hence creating a more knowledgable workforce. This produces a very flexible organisation where people will accept and adapt to new ideas and changes through a shared vision.

A learning organisation therefore is an organisation whose people are in a continuous search for new and better ways to adapt to change and enhance performance.
A learning organization has five main features; systems thinking, personal mastery, mental models, shared vision and team learning.


Systems thinking- The idea of the learning organization developed from a body of work called systems thinking. Systems thinking states that all the characteristics must be apparent at once in an organization for it to be a learning organization. If some of these characteristics is missing then the organization will fall short of its goal.
Personal mastery. The commitment by an individual to the process of learning is known as personal mastery.[There is a competitive advantage for an organization whose workforce can learn quicker than the workforce of other organizations. Individual learning is acquired through staff training and development


3. Mental models. The assumptions held by individuals and organizations are called mental models. In creating a learning environment it is important to replace confrontational attitudes with an open culture. Unwanted values need to be discarded in a process called unlearning.[

Shared vision. The development of a shared vision is important in motivating the staff to learn, as it creates a common identity that provides focus and energy for learning.

5. Team learning. The benefit of team or shared learning is that staff grow more quickly and the problem solving capacity of the organization is improved through better access to knowledge and expertise. Team learning requires individuals to engage in dialogue and discussion; therefore team members must develop open communication, shared meaning, and shared understanding.

More central ideas of the LO:


visioning Proactive learning Continuous experimentation & risk taking Leaders as facilitators and learning leaders Team learning

In the 1980's, we saw an increase in the attention paid to organizational

culture as an important determinant of organizational success. Many

experts began to argue that developing a strong organizational culture is essential for success. While the link between organizational culture and organizational effectiveness is far from certain, there is no denying that

each organization has a unique social structure and that these social
structures drive much of the individual behavior observed in organizations.

Comprised of the assumptions, values, norms of organization members and their behaviors.
A system of shared meaning held by members that distinguishes the organisation from other organisations. Culture is about how the organisation organises itself, it's rules, procedures and beliefs make up the culture of the company. The specific collection of values and norms that are shared by people and groups in an organization and that control the way they interact with each other and with stakeholders outside the organization.


is a societys (or groups) system of shared, learned values and norms; as a whole, these values and norms are the societys design for living

Values: abstract ideas about the good, the right, the desirable Norms: social rules and guidelines; determine appropriate behavior in specific situations

Folkways (mode of thinking): norms of little moral significance

dress code; table manners; timeliness thievery, adultery, alcohol

Mores: norms central to functioning of social life

Culture is learned, shared, and transmitted from one generation to the next.
Culture can be passed from parents to children, by social organizations, special interest groups, the government, schools, and churches. Culture is multidimensional, consisting of a number of common elements that are interdependent.

Culture is comprised of the assumptions, values, norms of organization members and their behaviors. Members of an organization soon come to sense the particular culture of an organization. Culture is one of those terms that's difficult to express distinctly, but everyone knows it when they sense it. For example, the culture of a large, for-profit corporation is quite different than that of a hospital which is quite different than that of a university. The Indian perspective of culture given by Sinha (2000) suggests that Culture consists of totality of assumptions, beliefs, values, social systems and institutions, physical artifacts and behaviour of people, reflecting their desire to maintain continuity as well as to adapt to external demands.


culture is the collective behavior of humans who are part of an organization and the meanings that the people attach to their actions. Culture includes the organization values, visions, norms, working language, systems, symbols, beliefs and habits.

The culture of an organisation may reflect in various forms adopted by the organisation. These could be :
The physical infrastructure Routine behaviour, langauge, ceremonies

Gender equality, equity in payment

Dominant values such as quality, efficiency and so on Philosophy that guides the organisations policies towards it employees and customers like customer first and customer is king, and the manner in which employees deal with customers.

Language (verbal and nonverbal)


Values and Attitudes

Manners and Customs

Material Elements

Social Institutions



1. Behavioral control 2. Encourages stability 3. Provides source of identity

2. 3. 4.

Barrier to change and improvement Barrier to diversity Barrier to cross departmental and cross organizational cooperation Barrier to mergers and acquisitions

Acculturation is the process of adjusting and adapting to a specific culture other than ones own. It is one of the keys to success in international operations.

High-context culture

Low-context culture

what is not being said can carry more meaning than what is said focuses on group development Japan and Saudi Arabia are examples

what is said is more important that what is not said focuses on individual development The U.S. is an example


Slide 3-7

High-Context Crucial to Communications: external environment, situation, non-verbal behavior Rela tionships: long lasting, deep personal mutual involvement Communication: economic al, f ast because of shared "code" Authority person: responsible f or actio ns of subordinates, loyalty at a premium Agreements: spoken, f lexible and changeable Insiders vs outsiders: very distin guishable Cultural pattern change: slo w

Low -Context explicit inf ormatio n, blu nt communicative style short duration, heterogeneous populations explicit messages, lo w reliance on non verbal dif fused through bureaucratic system, personal responsibility tough to pin dow n w ritten, f inal and binding, litigious, more law yers dif ficult to identify, foreigners can adjust f aster

See E.T. Hall & M.R. Hall, Understanding cultural differences, 1990, Intercultural Press


Culture Role Culture Task Culture Person culture Forward looking culture Backward looking culture


diversity is having people of different races, cultures, religions, nationalities, ethnic groups and backgrounds making up a community.

Goal for organizations seeking cultural diversity is pluralism


= belief that ones own group or subculture is inherently superior to other groups or cultures


= belief that groups and subcultures are inherently equal

= an organization accommodates several subcultures


Mind-Sets about Diversity Problem or opportunity? Challenge met or barely addressed? Level of majority-culture buy-in (resistance or support)

Organization Culture Valuing differences Prevailing value system Cultural inclusion

Education Programs Educate management on valuing differences Promoting knowledge and acceptance Taking advantage of the opportunities that diversify provides


HR Management Systems (Bias Free?) Recruitment Training and development Performance appraisal Compensation and benefits Promotion

Source: Taylor H. Cox and Stacy Blake,Managing Cultural Diversity: Implications For Organizational Competitiveness, Academy of Management Executive 5, no 3 (1991), 45-56

Heterogeneity in Race/Ethnicity/Nationality Effect on cohesiveness, communication, conflict, morale Effects of group identity on interaction (e.g., stereotyping) Prejudice (racism, ethnocentrism)

Higher Career Involvement of Women Dual-career couples Sexism and sexual harassment Work-family conflict



invisible barrier separates women and minorities from top management positions
Fortune 500 Women Corporate Officers 2004 = 15.7% 2000 = 12.5% 1995 = 8.7%

Only eight Fortune 500 companies have female CEOs

Ethical Dilemma: A Mans World


Stages of Diversity Awareness

Highest Level of Awareness

Adaptation Able to shift from one cultural perspective to another Able to empathize with those Acceptance of other cultures Accepts behavioral differences and underlying differences in values Recognizes validity of other ways of Minimizing Differences thinking and perceiving the world Hides or trivializes cultural differences

Integration Multicultural attitude-enables one to integrate differences and adapt both cognitively and behaviorally

Focuses on similarities among

all peoples Defense Perceives threat against ones comfortable worldview Uses negative stereotyping Assumes own culture superior
Source: Based on M. Bennett, A developmental Approach to Training for Intercultural Sensitivity, International journal of Intercultural relations 10 (1986), 176-196.

Denial Parochial view of the world No awareness of cultural differences

In extreme cases, may claim other

cultures are subhuman

Lowest Level of Awareness


is the branch of philosophy that focuses on morality and the way in which moral principles are applied to everyday life. Ethics has to do with fundamental questions such as What is fair? What is just? What is the right thing to do in this situation?


ethics involves describing, characterizing and studying morality

What is


ethics involves supplying and justifying moral systems

What should be

Fellow Workers

Fellow Workers

Regions of Country



The Individual
Conscience Friends Employer

The Law

Religious Beliefs

Society at Large



involves a discipline that examines good or bad practices within the context of a moral duty. Moral conduct is behavior that is right or wrong. Business ethics include practices and behaviors that are good or bad at the workplace.

The standards of conduct and moral values governing actions and decisions in the work environment. Social responsibility.

Balance between whats right and whats profitable.

Often shaped by the organizations ethical climate

Three Types Of Management Ethics



2. 3.

Immoral ManagementA style devoid of ethical principles and active opposition to what is ethical. Moral ManagementConforms to high standards of ethical behavior. Amoral Management

Intentional - does not consider ethical factors Unintentional - casual or careless about ethical considerations in business


Behavior or act that has been committed

compared with

Prevailing norms of acceptability

Value judgments and perceptions of the observer


Organizational effectiveness is the concept of how effective an organization is in achieving the outcomes the organization intends to produce.
Effectiveness refers to the degree of congruence between organizational goals and some observed outcome.

Organizations can be effective or ineffective in a number of different ways, and these ways may be relatively independent of one another.

Productivity Efficiency Employee absenteeism Turnover Goal consensus Conflict Participation in decision making Stability Communication

How can we measure effectiveness?

In order to measure the effectiveness let us analyse following components of organisational effectiveness. The different components of organisational effectiveness can be found from the answer to the following questions.

Are the employees satisfied with the organisation? Are the customers satisfied with the organisation? Is the organisation profitable? Is the organisation growing in terms of profit, revenue, number of products, expansion into new locations, line of products etc? Is the organisation productive i.e., creating goods and services of high value at minimum cost? and Is the organisation innovative or stale?

Several factors influence the organisational effectiveness. 1. Managerial Policies and Practices 2. Environmental Characteristics 3. Employee characteristics 4. Organisational Characteristics

Managerial policies and practices have a direct bearing on the Organisational effectiveness. The major managerial policies and practices are as follows :

Strategy Leadership Decision-making Rewards Communication

Organisational effectiveness is influenced to a great degree by the external environmental characteristics. It is dependent on how is the external environment predictable, complex and hostile to the organisation and its activity. The major characteristics are as follows:

Predictability- Predictability refers to how certain or uncertain an organisation may be towards supply of various resources; human, raw material etc. It is an element of external environment.

Complexity- Environment complexity refers to the heterogeneity and range of activities which are relevant to an organisations operations. How many diverse groups from external environment the organisations have to deal with.
Hostility- A hostile environment is one in which the underpinning of the organisation is threatened. How is an organisation viewed by the people at large.

The characteristics of the human resource could make or break an organisation. It is employee characteristics, which is reflected in the success or failure of an organisation. The major characteristics are as follows: Goals Skills Motives Attitudes Values

Organisational characteristics refer to the general conditions that exist within an organisation. Various organisational characteristics influence organisational effectiveness. The major characteristics are as follows: Structure Technology Size

Structures and behaviours are aligned with business needs. Disruption to business is minimised which reduces operational risk. Employee morale is sustained which maintains productivity. The right employees and talent are retained. Employees objectives and rewards are aligned to business goals.