Why measure Organizational Effectiveness ??
- Organizational effectiveness is essential to an organization’s ability to implement its strategy and create impact
- Building on Mckinsey’s & Bain’s research, The Brew has found that effective organizations demonstrate strengths in five essential areas: 1) Leadership & Clarity of Mission 2) Structure & Decision-Making 3) Capability & Capacity 4) Systems & Work Processes and 5) Culture.
- Identifying an organization’s strengths and weaknesses in these areas through an organizational effectiveness diagnostic enables managers to maximize impact by developing action plans to strengthen weaknesses and maximize strengths
- Measuring OE is extremely important and critical for organizations, especially those who are envisaging steep growth trajectory, witnessing challenging times from competition, experiencing sub-optimal results from strategy execution or who are on the cusp of critical change management / transformation
- An organizational effectiveness diagnostic is a survey-based tool used to rigorously and systematically assess an organization’s relative strengths and weaknesses in each area central to organizational effectiveness.
About the Client Organization
This Social Enterprise is working across strata, to dramatically scale up access to education in the last mile. With millions of children, especially girls deprived of education in the developing world, this social enterprise is working across the country, taking a leading role with governments and partners in ensuring last mile delivery, lowering the costs of delivery, driving retention across till secondary education and accelerating the roll out of its mission, to improve access, availability, dissemination & retention across educational value chain.
The Pain Points
The senior leadership team sought The Brew’s support during a time of rapid growth in its geographic and programmatic scope. Such a steep growth path typically presents challenges, notably to ensure that management structures, systems, and processes keep pace. This, social enterprise sought to strengthen these; a particular challenge was to do so in a way that allowed the organization to retain its agile and entrepreneurial culture, and to ensure that the right systems were there to enable & sustain success.
The Brew Approach
Similar to other OE improvisation case for an ecommerce firm, this was a classic case of many things done right at a micro level, however, with a progressive & steeper context as mandate, not only the micro elements needed a re-alignment, but also the need for a strong overall glue that can channelize the organizational effort spend in to one, i.e. up the Organizational Effectiveness quotient, improving yield manifolds. (Also see, the secret of successful strategy execution – HBR 2008)
With an improvised OE, alignment & measurability deployment, in the for-profits setups the metric of effectiveness is profit differentials, serving to be a basic yardstick to help gauge contribution & utility fulfillment of all elements, however in non profit, this becomes difficult, and hence our approach was to arrive at indicative metric of overall purpose fulfillment (establishing effort correlation at functional level directly to number of girls educated & number of lives positively impacted), proportionate to each element’s contribution. In a way, this turned out to be a game changer !!
The Brew took a three-phased approach. First, a diagnostic phase including a organization wide staff survey to understand perceptions of management, leadership, culture, and systems; in-country visits including focus groups and interviews with staff to understand their priorities for improvement; and a desk review of relevant data on existing systems and processes.
The Impact – Upping the Organizational Effectiveness Quotient
After prioritizing areas for strengthening, The Brew then supported in a ‘design’ phase, using workshops with client’s project team to develop concrete work streams and initiatives, for processes and systems as well as for people and leadership development. The third, final phase involved joint implementation planning and culminated in an all-staff retreat to launch the implementation process owned and led by client. The organization was able to scale to the required levels, while re-visiting its operational metrics, effectiveness & realizing higher fulfillment of its mission.
A steep growth path presents challenges, to ensure that management structures and systems keep pace and agility. It’s important to prepare well, & to understand what it will take to succeed, along with knowing the cost of failure. OE helps attain these, to take us beyond the finish line.