This article throws light upon the four main approaches to the study of organizational effectiveness. The approaches are: 1. Systems Resources Approach 2. Goal Approach 3. Internal Functioning Approach 4. Strategic Constituencies Approach.
Approach # 1. Systems Resources Approach:
This approach to organisational effectiveness focus on inputs — that is, on the extent to which the organisation can acquire the resources it needs. This perspective attributes effectiveness to organisations that exhibit low performance or productivity, so long as they are able to acquire the necessary resources.
Approach # 2. Goal Approach:
The approach focuses on the organisation’s outputs — that is, on the degree of goal attainment achieved by the organisation. Since there are often conflicts between financial and participant goals there is need for trade-off among the various goals of the organisation in order to achieve balanced performance.
Approach # 3. Internal Functioning Approach:
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This approach deals more narrowly with the internal mechanisms of the organisation. The focus is on minimising strain, integrating individuals and the organisation and conducting smooth and efficient operations. An organisation that focuses primarily on maintaining employee satisfaction and morale, minimising conflict and being efficient subscribes to this view.
Approach # 4. Strategic Constituencies Approach:
This approach focuses on the groups that have a stake in the organisation such as suppliers, lenders, participants, customers and others who are directly and indirectly influenced by the company. According to this view, effectiveness is the extent to which the organisation satisfies the demand and expectations of all these groups. As in the goal approach, trade-offs are essential.
Using the system as a frame of reference, we use Fig. 21.1 to compare the four different approaches to studying organisational effectiveness. The systems approach focuses on inputs, the goal approach on outputs, and the internal functioning approach on transformation process.
The strategic constituencies approach is most closely related to feedback process. It is through feedback that the organisation learns how well it has met the demands and expectations of its strategic constituencies.