Models of Organisational Effectiveness

In our previous article, we introduced the concept of organisational effectiveness. This week we will focus on the models of organisational effectiveness which management can use to assess/ measure effectiveness. There are seven types of models used to assess organisational effectiveness which will be discussed below.

1. a) Goal Model – entails identifying and setting an organisation’s goal as well as assessing how well the organisation has achieved those goals.

Chester Bernard notes that effectiveness is the accomplishment of objectives of cooperative effort.

The degree of accomplishment indicates the degree of effectiveness. For this to be a valid measure of effectiveness, the organisation should have measurable goals in place and the organisations employees should understand the goals and their role in attaining these goals.

Most organisations evaluate goal effectiveness in terms of profitability, growth, market share as well as return on investment.

1. b)   Internal Processes Model – focuses on internal organisation health excluding the external environment.

This model stresses the systems approach in which all internal departments are aligned and working together to achieve organisational goals. Under this model the indicators for effectiveness are:

1. a.    Team spirit
2.   Strong culture
3.   Positive work environment
4. Operative communication across all levels
5. Conflict resolution biased towards the organisation’s goals
6. Reward policy based on performance
7. Resource Based Model- perceives resources as key to superior organisational performance, as resources enable the organisation to gain and sustain competitive advantage.

There are three main categories of resources which are physical capital resources which refer to company equipment, access to materials, organisations network among others.

Human resources refer to the employee’s experience, skills, talent, and training and how these are being to achieve the organisations goals as well as achieving competitive advantage.

Organisational resources refer to a company’s formal structure, which comprises planning, managing, and coordinating systems.

Organisational resources also encompass informal relations amongst departments within the organisation as well as between the organisation and its external environment.

1. d)Strategic constituency Model – measures effectiveness by measuring the degree to which it satisfies those in the environment that have the capacity to threaten the organisations survival.

Each constituency has a degree of power and pursues different interests.

These constituencies often include shareholders, management, employees, customers, suppliers, and government.

Under this model it is important to identify the expectations of strategic constituencies and a way to meet these expectations.

1. e)Stakeholder model – like the strategic constituencies model extends to include strategic constituencies that are indirectly affected by the organisation but have no power over the organisation (for example families of employees, activists, and the community).

It is important for organisations to consider the interests of these groups as they potentially have a negative impact on the organisation.

1. f)Competing values Model – effectiveness is measured by the ability of an organisation to simultaneously promote competing values.

An organisation’s ability to reconcile the competing values of its employees, investors and customers is key to being effective.

Cameron and Quinn proposed that when organisations can sustain multiple competing values, they will be more effective.

1. g)Abundance Model – suggest that effectiveness equates to unleashing the highest potential of human systems.

This is achieved by attaining a balance between positive and negative values.

It is important to note that both positive and negative elements and emotions are required to pus the potential of human systems.

Measuring organisational effectiveness is not of choosing between two alternatives, it is about considering the multiple perspectives and assessing whether the organisation is achieving its goals it set out to achieve as well as reaching its full potential.

Chiedza Kadare is an OD Practitioner. You can get in touch with her on WhatsApp/call +263 77 283 0986 or Email chiedza.kadare@gmail.com

Paul Nyausaru is an OD Practitioner and leadership coach. For all your OD interventions and leadership development training you can get in touch with him on WhatsApp/call +263774062756 or Email pnyausaru@gmail.com