After reading this article you will learn about the meaning and elements of managerial effectiveness.

Meaning of of Managerial Effectiveness:

The term ‘managerial effectiveness’ could mean achievement of organisational goals, increase in productivity, profit, workers’ satisfaction, growth, diversification etc. Managerial effectiveness aims at optimum allocation and utilisation of scarce organisational resources in order to achieve the goals at minimum cost. It aims at deriving maximum output out of minimum input.

Successful managers keep the organisation going in the present and future. An organisation must be capable of performance, growth and change in the future. An organisation that does not account for future has destroyed capital, that is, capital not enough to produce wealth for its survival. Managerial effectiveness aims at survival, growth and adaptability of organisations to the external environment.

Elements of Managerial Effectiveness:

Much of what an organisation achieves depends upon managerial effectiveness. Manager does not just perform the functions of management. He is also an administrator and an entrepreneur. As an administrator, he administers what already exists and as an entrepreneur, he redirects resources from areas of low returns to high returns.


He examines the present and creates a bright future. Managerial effectiveness implies that managers should optimise the results by choosing the right products, markets, technologies, services, facilities etc. It attempts to change the scenario of business areas and maximise efficiency in terms of input-output ratio. Effective managers mediate between the organisation and its environment. They enable the organisation to adapt the changing environment.

Managerial effectiveness consists of the following elements:

1. Manager:

Manager is the key pin of a successful organisation. Well-defined objectives and strategies are required to effectively transform inputs into outputs. Managerial effectiveness is governed by managerial skills, competence, intelligence, knowledge, sincerity and creativity. It is judged by not what the managers do but by how well they do. Effective managers enable the business to grow in the dynamic environment.


2. Organisation:

Managerial effectiveness is also judged by the organisation itself. Highly innovative and creative managers may not perform well if the organisation structure does not permit them to do so. The structure, value system, design, culture, size and the work environment largely determine the way managers manage the organisation. A highly bureaucratic and formal organisation structure may not have committed and effective managers.

3. Entrepreneurship:

Success cannot be ensured unless managers have the quality of entrepreneurship. Managerial effectiveness ensures that business in future is different from business today. It requires hard work, intelligence, creativity and innovativeness to keep the business successful in future.


4. Environment:

Business operates in the dynamic and turbulent environment with ever changing factors (economic, political, legal, social etc.). Managers adapt the organisations according to demands of the environment. Successful and effective managers not only respond to environment; they also influence the environment and become market leaders in the industry.

Managerial effectiveness is not an end. It is a means to the end, that is, efficient attainment of organisational goals. In order to accomplish the tasks effectively, managerial effectiveness deals with managerial jobs, skills of managers and the organisation as a whole.