Strategic Management: Formulation and Implementation

Organizational Performance

The performance is a global concept the represents the results of human activities. Organizational performance is "the way in which an organization tries to be effective" (Ricky W. Griffin). An organizations's performance can be measured in many different ways. The most common ways are in terms of efficiency or effectiveness. "Performance, ... is the attainment of organizational goals by using resources in an efficient and effective manner" (Richard Daft). Effectiveness and efficiency is viewed as subcomponets of performance.  As Peter Drucker has stated, efficiency means "doing things right," and effectiveness means "doing the right things." The more complete definitions are that: "organizational efficiency refers to the amount of resources used to achieve an organizational goal", and "organizational effectiveness is the degree to which organization achieves a stated objective"(Richard Daft). The more resources wasted during the production process, the more inefficient the manager. If organizations are using their resources to attain their goals, the managers are effective. Finally, "productivity is the level of output of goods and services achieved by the resources of an organization" (Ricky W. Griffin) Effectiveness, efficiency, performance, and productivity are all important concepts for managers and organizations.

Managers must be both effective and efficient. Particularly, effectiveness is the secret of success for any organization. For managers "The pertinent questions is not how to do things right, but how to find the right things to do and, to concentrate resources and efforts on them" (Ricky W. Griffin).

A Framework for Performance. Andrew D. Szilagyi developed a framework for performance for managers to carefully consider it attempting to achieve organizational goals:

Ricky W. Griffin proposed a more detailed model that related performance, effectiveness and productivity. This framework can help managers monitor all of their activities and successfully carry out the control function at the organizational level.