Organizational Goals

1
Organizational Goals

• Mission Statement
• General objectives and guiding principles ?

Operative Goals Specific sub-goals to guide
various departments and business units
2
Four Approaches to Evaluating Effectiveness
APPROACH
DEFINITION
WHEN USEFUL

An Organization is effective to the extent
that... It accomplishes its stated goals.
The approach is preferred when Goals are clear,
not conflicting, measurable, and appropriate.
Goal Attainment
Resource Acquisition
It acquires and successfully manages resources.
A clear connection exists between inputs and
outputs.
Outcomes are hard to measure or when focus is on
the long term.
Efficiency is high and/or other indicators of
internal health are positive
Internal Processes
Stakeholder Satisfaction
All critical stakeholders are at least minimally
satisfied
Stakeholders have powerful influence on the
organization, and the organization must respond
to demands.
3
Approaches to Measuring Effectiveness
ORGANIZATION Internal Activities and Processes
Resource Inputs
Product and Service Outputs
System Resource Approach
Internal Process Approach
Goal Approach
4
COMPETING VALUES APPROACH TO EFFECTIVENESS VALUES
To place an organization in a quadrant 1.
Determine whether management is more concerned
for employee well-being (internal) or the
well-being of the organization in its
environment (external) 2. Determine whether the
primary management value is top-down control
(control) or adaptation and change
(flexibility.)
STRUCTURE
Flexibility
HUMAN RELATIONS MODEL Goal values human resource
development Subgoals cohesion, morale, training
OPEN SYSTEMS MODEL Goal values growth, resource
acquisition Subgoals flexibility, readiness,
external evaluation
Internal
External
FOCUS

RATIONAL GOAL MODEL Goal valuesproductivity,
efficiency, profit Subgoals planning, goal
setting
INTERNAL PROCESS MODEL Goal values stability,
equilibrium Subgoals information management,
communication
Control
Note Organizations may cross quadrants, but be
primarily in one or two quadrants.
5
Four Models of Effectiveness Values
Flexibility
OPEN-SYSTEMS MODEL
HUMAN-RELATIONS MODEL
Ends Skilled work force
Means Flexibility
Means Cohesive work force
Ends Acquisition of resources
Internal
External
Means Availability of information
Ends Productivity and efficiency
Means Planning
Ends Stability
Control
RATIONAL-GOAL MODEL
INTERNAL-PROCESS MODEL
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Stakeholder Approach to Effectiveness
EXAMPLES OF POSSIBLE EFFECTIVENESS CRITERIA BY
VARIOUS STAKEHOLDER GROUPS
Stockholders Growth in dividend payments Growth
in share price Consistent dividend
payments Growth in net asset value
Customers Price always competitive Emphasis on
quality Return and replacement policies Warranty/g
uarantee provisions
Suppliers Timely payment of debt by
company Adequate liquidity Integrity/public
standing of directors Negotiating ability of the
purchasing manager
Employees Good compensation and benefits Job
security Sense of meaning or purpose in the job
Opportunities for personal development Amount of
interesting work
Lenders Liquidity of the company Character and
standing of company management Quality of assets
available for security Potential to repay
interest and capital on due date
Government Efficient user of energy and natural
resources Adhering to the countrys laws Paying
taxes Provision of employment
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Stakeholder Approach to Effectiveness
1. List all stakeholders of an organization. 2.
Determine amount of power each has with respect
to the organization. 3. For a particular
effectiveness criterion (e.g., market share,
customer service) determine its importance to
each stakeholder group. 4. Place stakeholder in
appropriate place on model.
1. High Power Low Importance
2. High Power High Importance
High
Power of Stakeholder Group Over Organization
Low
3. Low Power Low Importance
4. Low Power High Importance

Low
High
Relative Importance of Effectiveness Criterion
to Stakeholder Group
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• STAKEHOLDERS
• POTENTIAL FOR THREAT TO ORGANIZATION

HIGH
LOW
HIGH
STAKEHOLDER TYPE 4
STAKEHOLDER TYPE 1
MIXED BLESSING
SUPPORTIVE
STAKEHOLDERS POTENTIAL FOR COOPERATION WITH
ORGANIZATION
Strategy
Strategy
COLLABORATE
INVOLVE
?
STAKEHOLDER TYPE 3
STAKEHOLDER TYPE 2
NONSUPPORTIVE
MARGINAL
Strategy
Strategy
MONITOR
DEFEND
LOW