Friday, September 20, 2013

People problems are often the source of profit problems ... Organizational Efficacy Matters


Organizational Efficacy is the belief people hold that their organizations can accomplish strategies and goals.  It is built from three factors:

  1. Do we know where we're going?
  2. Can we work together?
  3. Can we stay the course when things get tough?
And thus, I hypothesize that Organizational Efficacy contributes to profitability, for if people do not know where they're heading organizationally, and if they cannot work together, and if they don't complete what they start, they will not be profitable.

It may sound like common sense, but in reality, managing these elements is not easy.  They require constant focus from management.

Helping people to know where they're going is a manager's responsibility.  Although people may ask for information, it is the responsibility of the leader to bring forth knowledge to steer the ship.


Helping people work together is, by far, the most complex of the three, since everyone has their own agenda which competes with everyone else's agenda.


Helping people find resilience is difficult, but often best displayed by leaders in the face of obstacles and grueling challenges.  



I repeat: if people do not know where they're heading organizationally, and if they cannot work together, and if they don't complete what they start, they will not be profitable.

This is the task of leadership in building organizational efficacy.  




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