Effective Organizations(Organization Development)
The trend toward reducing the number of management levels in organizations is being driven by the need of organizations to increase the speed and accuracy of communication. Traditional organizations, with their many levels of management, process information slowly. Plus the information gets filtered along the way, often for political reasons which can conflict with the overall good of the organization.
Processing information quickly and accurately, then acting upon what is learned, is critical for the success of an organization. Another key item is selecting relevant information for measuring organizational performance relative to organizational goals. This can be challenging in light of today's information rich environment. (Selecting the wrong metrics, those which pull the focus of the organization away from what is most important for its ultimate success, will harm an organization). After selecting the appropriate metrics, organizational performance can be further enhanced by linking the performance results to individual or team incentives.
Performance Management is a process that can facilitate the flow of information in an organization. Performance Management includes the following:
- A flow-down of goals beginning with the organization's strategic plan, to the annual organizational goals, to the President's or CEO's individual performance goals, on down to all employees in the organization. Thus each member of the organization can ultimately tie their individual performance goals to the organizational goals .
- A formal feedback system in which individual performance results can ultimately flow back and influence the organization's strategic plan. Feedback must occur frequently.
- A mutual (between the employee and manager) establishment of duties and responsibilities and criteria for measuring success. Also, performance results are mutually determined. The mutuality is what encourages the feedback.