Organizational Effectiveness

"People are more comfortable with a consistent problem than an inconsistent solution"

--Andy, Right Management (Singapore)--





How do organizations become effective?

To become effective an organization needs internal synergy which I would define as a seamless movement and exchange of ideas, knowledge, resources,talent and responsibilities governed by the strategic orientation of the organization at any given time. An organization can be effective in different aspects at different times. It may also have different degrees of effectiveness at different times as most often than not, it is difficult to achieve a sustainable synergy between all the areas as mentioned above.

As a case in point, Air Asia was extremely effective in managing its costs in the early days of its operation. Its service suffered though. Then, it became effective in managing its costs and providing a reasonable standard of service. Now, it is trying to become effective in keeping its costs low, maintain service standards AND manage competition. Is Air Asia an effectiveness organization today? Yes and No. It is in a sense effective as it is able to grow its revenue and market penetration year on year but that can also be largely due to the protected business environment of the aviation industry. It's true effectiveness will come into full view upon the establishment of a more visible open sky policy in the region. But, I would not call Air Asia as an ineffective organization today. If we use the same model, Proton is also going through a similar organizational effectiveness cycle.

But then, an organization may be highly synergistic internally and yet less effective with its bottom-line issues. Starbucks may be one these example at least in the case of USA. It is a highly effective organization but external factors have slowly eroded its effectiveness. How it deals with it will determine its future effectiveness.

So, an organizations becomes effective by achieving a reasonable level of internal synergy as per it's strategic orientation and its effectiveness is a holistic phenomena which may change as it grows and expands.

Organizational effectiveness is not a straight forward matter. It threw up more questions than answers while I was reading and researching on it. However, my trip to Sydney next week to attend the Organizational Effectiveness Framework training hopefully will answer these questions.