Organizational Effectiveness

Lecturer: R.K.Niroshika
 Organizational Effectiveness
Why do we care?
• Historic
– Short term/Quick Fix focus
– Fire fighting
– We’ve always done it this way
– Random improvement efforts
– Inspect for errors
– Reactive
– Opinions not facts
– Motivated by profit
– Rely on programs
– Localized competition
– Reasonable cost
– Large budgets
– Resources available
– Compete
– Individual efforts
– Strong management
• Now
– Long term focus
– Structured problem solving
– Innovation and change
– Structured improvement
– Error identification and
prevention
– Proactive
– Facts not opinions
– Motivated by customers
– New way of life
– Intense global competition
– Lowest possible cost
– Small budgets
– Limited resources
– Cooperate
– Team efforts
– Strong leadership
 Organizational Effectiveness

• Efficiency focuses on activities

• Effectiveness focuses on
results
 Organizational Effectiveness
• What is an effective organization?
– An effective organization, one that excels, is one
that continually strives to identify and focus on
factors critical to its customers and improves its
processes in order to provide the highest-quality
product or service possible.

– Every company wants to do this, it’s not

easy!
• What is an effective organization?
– Organizations try different strategies in order to
achieve their goals.
• Disjointed efforts
• Flavor of the month
• Most efforts are successful in the short run
– How can an organization sustain effective
performance?
• What is an effective organization?
– How can an organization sustain effective
performance?
• Generating success requires an organization-wide
approach that improves and enhances the whole
process of providing a product or service, enabling the
organization to exceed customer expectations, each
time and every time.
• What is an effective organization?
– How can an organization sustain effective
performance?
• People need a sense of how to pull a variety of
knowledge and skills together to make improvements
in a complex environment.
– “umbrella coverage”
 Umbrella coverage
Customer Focus Six Sigma

Value Chain management Lean Manufacturing

Leadership Business Results

Strategic Planning Information and Knowledge

Management
Quality Assurance
Organizational Philosophy
Project Management
Value Engineering
Elimination of Waste
Teams
Human Resource
Management Just-in-time

Quality Tools Process Management Improvement

Organizational Effectiveness
 Factors Affecting Organizational Success

Strategic Factors Organizational Factors

Market Strategic Deployment
Product Effective Leadership
Technology Policies
Customers Procedures
Suppliers Processes
Vision Continuous Improvement Culture
Value Creation Strategy Problem-solving
Commitment
Culture
Measures of Performance
People Factors Trust, Honesty, & Ethical Behavior
Employee Involvement
Education
Training
Internal Supplier-Customer Relations Environmental Factors
Motivation Social
Teamwork Economic
Communication Competitive
Safety Technology
• How is an effective organization created?
– What is the mission of the organization?
– What is the business the organization is really in?
– What are the primary products or services the organization
provides to their customers?
– Who are their customers?
– What do their customers expect and need?
– How does the organization know what the customers’
needs and expectations are?
• How is an effective organization created?
– How well does the organization meet the needs and
expectations of their customers?
– How does the organization know how well it is doing?
What is the proof? What are the indicators?
– Do management’s strategies and actions support the
business and support the organization in meeting the
customers’ needs and expectations?
– Do the employees know how the work they do specifically
benefits the ultimate, external, customer?
– What improvements have been made based on the
answers to these questions?
– What is management doing to support improvement
efforts?
• What benefits can be gained from creating an
effective organization?
– Improved profitability
– Increased customer retention
– Reduced customer complaints and warranty claims
– Reduced costs through less waste, rework
– Greater market share
– Increased employee involvement and satisfaction, lower
turnover
• What benefits can be gained from creating an
effective organization?
– Increased ability to attract new customers
– Improved competitiveness
– Improved customer satisfaction
– Improved management-employee relations
– Improved focus on key goals
– Improved communication
– Improved teamwork
 The Journey to
Organizational Effectiveness
Benefits of Creating and Maintaining
an Effective Organization
Improved:
• profitability
• competitiveness Reduced:
• customer satisfaction • customer complaints
• management-employee relations
• focus on key goals • warranty claims
• communications • cost
• teamwork
• waste
• employee morale
• company image • rework
• revenue • employee turn-over
• service to customers (internal &
external)
• effectiveness
• planning Increased:
• work environment • employee involvement
• decision making
• employee satisfaction
Greater: • ability to attract new customers
• market share
• adaptability