How do managers measure organizational effectiveness
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There are three main approaches to measuring organizational effectiveness: 1. The external resource approach evaluates an organization's ability to secure and manage scarce resources by looking at metrics like market share, input costs, and stakeholder support. 2. The internal resource approach assesses how well an organization functions and utilizes its resources, focusing on innovation, decision-making speed, employee motivation, and time to market. 3. The technical system approach examines an organization's efficiency in converting resources into products and services, using indicators such as productivity, quality, costs, and customer service levels.
How do managers measure organizational effectiveness
- 1. HOW DO MANAGERS MEASURE ORGANIZATIONAL EFFECTIVENESS ??
- 2. APPROACHES TO MEASURE ORGANIZATIONAL EFFECTIVENESS External Resource Approach Internal Resource Approach Technical Approach
- 3. EXTERNAL RESOURCE APPROACH •Lower cost of inputs •Obtain high quality inputs of raw materials and employees •Increase market share •Increase stock price •Gain support of stakeholders such as government or environmentalist Goals Evaluates the organizations ability to secure , manage and control scarce and valued skills and resources
- 6. INTERNAL RESOURCE APPROACH •Cut decision making time •Increase rate of product innovation •Increase coordination and motivation of employees •Reduce conflict •Reduce time to market Goals Evaluates the organizations ability to be innovative and how effectively it functions and operate its resources. •Time to market a new product •Time to take a decision •Time taken to coordinate activities
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- 8. TECHNICAL SYSTEM APPROACH •Increase product quality •Reduce number of defects •Reduce production cost •Improve customer service •Reduce delivery time to customers Goals Evaluates the organizations ability to convert skills and resources into goods and services efficiently. • Increased productivity • Reduced cost of labor or materials
- 11. Form groups with four members each. Select any company from the industry which you would like to work. Evaluate the effectiveness of that company based on the three approaches Prepare a presentation based on it.