Factors Influencing Organizational Effectiveness - Essay Example

ORGANIZATIONAL EFFECTIVENESS Introduction Organization effectiveness (OE) refers to the processes and frameworks set into place by an organization to evaluate how efficient the organization is, and how effective it is in achieving the set objectives and goals (Robbins & Barnwell, 1994). Organizational effectiveness is important since it helps to evaluate the performance, internal and external operations of an organization in relation to achieving results. For an organization to be considered effective, it has to be competent on its communication settings and implement ethics in its daily running of the organization (Rainey, 2009). Ethics are important and can be achieved by offering the services needed from the organization in fairness, honesty, integrity, equity and uphold moral responsibility between its internal and external publics in pursuit of its set objectives. Factors influencing Organizational Effectiveness For an organization to be effective in achieving its set goals, various elements are in play. The organization’s ability to be flexible and be able to quickly adapt to environmental changes or economic down turns, it needs to develop contact and communication frameworks between the internal and external environments of the organization (Daft, 2009). This can be done by adapting technological systems necessary to boost production and improving the quality in execution of duties in order to achieve the desired outcomes. For example, modern corporations have implemented the use of internet in its service delivery. This has been done by uploading corporate portfolio on the web, advertising in the internet and through the electronic media in preference to traditional forms of advertising, and use of video conferencing. Moreover, they have developed its telecommunication structures by tapping into fiber optic cables, uploading group pages in social networking sites like twitter, my space and facebook, and using satellites technology (Griffin, 2006). Other ways that the organization develops the contact between itself and the external environment is by analysing the strategies used by its competitors in service delivery and use of trends used internationally to solve business and organizational issues in the industry the organization is. The other factor that influences organizational effectiveness is the process and initiation of inventions and innovations in the organization’s production, product presentation, service delivery and operations within the organization. They can fully exploit the potential of its employees by use of motivational techniques, which helps the employees to freely come up and implement new ideas (Morgan, 2006). They can be continually innovative in their service delivery, its operations or production, by understanding what the market needs, what are the market’s tastes and preference, and what factors influence the market’s choices. Other ways of innovation can be achieved through rebranding, and formulating new ways and methods of operating. The ability of the organization to keep in touch with its operations is a key factor to organizational effectiveness. Ann organization can only be effective if it is able to be continually updated on its profits, losses, market share, and investments. This is important especially to value their equity, accessing loans and developing objectives and resolutions for the next annual year. This allows accountability of the organization without putting so much pressure on initiative. This process is eased by regular financial accounting and conducting marketing plans and marketing audits. The other factor is the rate at which the organization relates with its clients or its market (Swanson & Holton, 2009). The organization needs to analyse if their supplies are satisfying the demands of its market, if they are addressing the fundamental needs of its market, what are alternatives available to meet the needs of the market and additional forms of products and services that the organization can be able to offer the market. Thus, increasing its market share and meet its set outcomes or objectives. Finally, the structure of the organization can influence organizational effectiveness. As the organization grows in its market share, there is need for more workforces to be able to meet the demands of its rising clientele (Rahim, 2001). This enlargement of workforce comes with its challenges, such as increased liabilities and logistics in terms of salaries to be paid, additional costs accrued from paying insurance and medical covers for the employees (Robbins & Barnwell, 1994). Moreover, managing and supervising a large group of employees is hard compared to managing a small group, since it is hard to monitor every single employee in a large corporate setting. Criteria Used in Assessing Organization effectiveness When a firm analyses its organization effectiveness based on performance and achieving the set outcomes, proper and effective management is integral in achieving this results (Rainey, 2009). Effective management is a management that helps its employees understand the mission, goals and purpose of the organization. Through working inline with the mission statement, implement marketing strategies and plans necessary to counter competition. Effective management are leaders who keep the interest of the internal and external publics before their own, and helps motivate them through various motivational techniques, help set standards of performance and place value on what the company expects at the end of a stipulated time (Swanson & Holton, 2009). Effective management that seeks to improve its organization effectiveness, allocates its resources in the required fields even on research and innovations, involved in establishing and controlling the roles and the hierarchy of authority, and understands the need to learn, analyse and improve the relations of the organization and its clients. Although measuring organization effectiveness in some instances has been difficult, there are various areas that can be used to measure the success of the firm, its performance, its acceptability to the market, and its ability to achieve the set objectives or outcomes. Assessment of organization effectiveness vary in every organization based on the mission and vision of the organization, the type of work the organization is involved in, the type of products and service the organization deals with, the context of environment that the organization is in and the demands or needs of the market (Rahim, 2001). Therefore, for sound organization effectiveness, the management needs to know what the organization is all about, how the organization functions, what area of emphasis the organization stresses on and the structures of the organization. The areas that help in measuring organization effectiveness are the ability of the firm to achieve its vision and mission, the level of satisfaction of the demands of the market, the quality of service and products produced. Other factors include the level at which the firm is creative, inventive and innovative, and its ability to be flexible enough to adapt to environmental changes be it in operations, organizing and in technological matters (Morgan, 2006). Other criteria areas are use of effective communication networks, low turnover of employees, increased sense of teamwork, stability as a market entity, ability to create brand loyalty, and the ability of the firm to interact and transact with other firms though mergers and forming new ventures or alliances. Approaches used in organization effectiveness There are four approaches that have been designed to help an organization to be effective in its service and products delivery and achieve its goals (Daft, 2009). Different approach is implemented depending on where the organization is in its life cycle. These approaches are integral for the survival of the organization against changing economic, technological, environmental and consumer trends. The goal attainment approach This approach is based upon the fact that organization are created and run on the basis of achieving a goal that was initially set. The end, which is the goal, is achieved by various techniques, which are the means. When setting goals, the management should consider putting up goals that are realistic, well defined and easy to understand, consensual and agreed upon by the stakeholders, bound by time, goals that can be managed and that are easy and it is possible to measure them (Dressler, 2004). Organizations that base their organization effectiveness on this approach are deliberate on the strategies they formulate; they are rational and are goal-oriented. Once the goals are verified that they are tangible, they can be measured and are agreed upon by all the stakeholders, the management specifies the conditions under which each goal shall be achieved and the level of degree of satisfaction that the goal should have is spelt out. This approach is difficult to implement since it conflicts on whose goals they are, and in case of multiple goals, they may conflict since their point of interest may vary and may be incompatible. Although multiple goals can be implemented in order of importance to be understood by the stakeholders, it is impossible to allocate importance since they are for different interests (Slack & Parent, 2006). Be it as it may, the timeliness of goals and achieving them can be improved by incorporating inputs not only from the senior staff but also the junior staff, analysing the importance of having long-term and short-term objectives and goals in an organization, understanding goals change as the organization evolves, and ensuring that the goals set can be measured, bound by time, can be easily managed. The systems approach Although goal attainment approach in evaluating organization effectiveness is based on the output or the product alone, system approach deals in the ability of the organization to remain stable and firm while acquiring inputs, processing the inputs, and channelling the goals. Therefore, it focuses on the means more rather than just the outputs only (Slack & Parent, 2006). This is done to lengthen the life of an organization, establish it as a social entity by developing good internal and external lines of communications. This approach is integral since for an organization to survive, it needs to pay attention to all sectors of its operations. Failure in one sector will results in poor outcomes. This is done by forming good relations between internal and external publics, reducing employee turnovers, replenishing weak sectors, replacing diminishing products and services, and anticipating the market’s change in tastes and preferences and predicting other influential changes like in technology. Effective use of this approach can be achieved by being flexible to changes, continuous acquisition of inputs and market acceptability of the outputs, increasing employee’s work satisfaction and creating clear and transparent lines of communications. The problem with this approach is that it is not measurable (Rahim, 2001). Goal attainment approach is favoured since its possible to measure end goals, rather than measuring the process of acquiring goals like the process of flexibility and adapting quickly to change. Flexibility can be improved by developing capacities to interpret and scan high volumes of a variety of data of the market, internal operations and the actions of the competition, and instantly developing models and hypothesis on the experiences of the organization (Griffin, 2006). Moreover, adaptability can be reinforced by being efficient in fast construction, acquisition and application of skilled manpower on essential and well-defined goals, taking decisive actions on all levels of the organization and implement alignment and realignment of available resources and inputs to allow proper execution of duties and in offering quality production. The Strategic Constituencies Approach This approach is similar to the systems approach in that it deals with forming good relations with the internal and external environments. However, the strategic constituents approach narrows it down to satisfying factors and elements affecting constituents who have a role to play in supporting and keeping the organization afloat or whose opinion or action can threaten the survival of the organization (Slack & Parent, 2006). The approach views organization effectiveness can only be achieved by satisfying the vested interests of integral constituents on whose the survival of the firms depends on, since the environment is composed by constituents whose interests competes for available resources (Robbins & Barnwell, 1994). The problem with this approach is that critical constituents change every so often, and in pursuit to please them, the organization may deviate from its set goals thus unable to achieve the anticipated outcomes. The Competing Values Approach This approach base its argument on organization effectiveness on three competing values that can be applied depending on the situation the organization is at and express the need to create balance between the models of effectiveness (Griffin, 2006). These models are the rational goal model that states that an organization is only effective if its able to achieve the set goals, the open system model that states that an organization is only effective if it able to acquire and process inputs, and the output thereof, be accepted by the market (Robbins & Barnwell, 1994). The other models are the internal process models that states that an organizational effectiveness lies on implementing effective and efficient transformational processes internally, and the human relations models that states that the organization is effective if it is able develop its employees. The three competing values are the cohesion between internal processes on long-term goals and external focus on outcomes on short-term goals of an organization. When an organization focuses on one, it alienates the other. Flexibility versus control is the other competing values. Control focuses on stability and predictability while flexibility focuses on being able to adapt to changes thus encouraging innovations (Morgan, 2006). The third competing value is where to place the emphasis on either the development or satisfaction of the needs of employees or focusing on the organization and what is needed for it to achieve its goals. The Most Applicable Approach in Assessing Organization Effectiveness The competing value approach is the most applicable and less problematic since it counter the problems presented in the goal attainment approach and the systems approach (Dressler, 2004). This is because the models in this approach focus on the issues that are encompassed in the ends and the means (Robbins & Barnwell, 1994). It gives support to the strategic constituents approach by better assessing the perception of the constituents on how the organization is effective rather than focusing on pleasing the elements of a particular constituent. Through the four organization effectiveness models, the approach helps managers to identify different criteria in dealing with different constituents and when and how to do it depending on the stage the organization is on its life cycle. The approach moreover identifies the need for multiple criteria and creating cohesion to assess effectively organization effectiveness of an organization (Rahim, 2001). Conclusion Organization effectiveness (OE) refers to the processes and frameworks set into place by an organization to evaluate how efficient the organization is, and how effective it is in achieving the set objectives and goals. Organizational effectiveness evaluates the performance, internal and external operations in relation to achieving results. In the four approaches to assessing organization effectiveness, the goal attainment approach an organization is effective if it is able to accomplish its set goals, and works well when the goals are well defined, agreed upon, timely, are easily managed and are measurable. The systems approach is based upon acquisition of resources and there exist a continuous flow from the inputs to the outputs. The third approach is the strategic constituents approach that applies that an organization can only be effective if it satisfies the needs of critical constituents on whom the organization’s survival depends on. The final approach is the competing value approach that states the success of an organization is dependent on matching the four major areas/ models to the preferences of the constituents, and stresses the need of an organization understanding that criteria do change over time. The competing value approach is the most applicable and less problematic since it counter the problems presented in the goal attainment approach and the systems approach. This is because the models in this approach focus on the issues that are encompassed in attaining the ends and processes involved in the means. It gives support to the strategic constituents approach by better assessing the perception of the constituents on how the organization is effective rather than focusing on pleasing the elements of a particular constituent. REFERENCES Daft. R.L. (2009). Organization Theory and Design; Organization Theory and Design. Stamford: Cengage Learning. Dressler. S. (2004). Strategy, Organizational Effectiveness and Performance Management: From Basics to Best Practices. Sidney: Universal-Publishers. Griffin .R.W. (2006). Management. Stamford: Stamford: Cengage Learning. Slack .T., Parent. M.M. (2006). Understanding sport organizations: the application of organization theory. Illinois: Human Kinetics. Morgan. G. (2006). Images of organization. London: SAGE. Swanson .A. R., Holton .E.F. (2009). Foundations of Human Resource Development. San Francisco: Berrett-Koehler Publishers. Rahim. M. A. (2001). Managing conflict in organizations; Understanding and Managing Public Organizations. Westport: Greenwood Publishing Group. Rainey. H. G. (2009). Essential Texts for Nonprofit and Public Leadership and Management. New Jersey: John Wiley and Sons. Robbins, S.P. & Barnwell, N. (1994). Organisational effectiveness: Organisation Theory in Australia, 2nd Ed. Prentice Hall, Sydney, pp. 43-71 Read More