Research Article Research Article Research Article: Article Info Article Info Article Info
Research Article Research Article Research Article: Article Info Article Info Article Info
Article History: Organizational effectiveness means how effectively an organization is achieving the goals, it intends
Received 14th September, 2013 to achieve. It is ordinarily used to refer goal attainment. In any organization, people and resources
Received in revised form contribute significantly towards its effectiveness. In fact, they make their impact in attaining
25th October, 2013 organizational goals. Keeping in view the role of organizational effectiveness in the determining goal
Accepted 10th November, 2013 achievement, the present study has been undertaken. A number of criteria have been used for
Published online 02nd December, 2013 measuring organizational effectiveness including Productivity, Efficiency, profitability, growth, goal
consensus, commitment to organization, ethical values, quality of goods and services, morale of the
Key words: employees, absenteeism and turnover, pay, supervision, job satisfaction, participation in decision
Job Satisfaction, making, stability etc. The study seeks to explore the variables contributing to organizational
Work Environment, effectiveness and the existence of relationship among them. Primary data used in the study has been
OCTAPAC Culture, collected on the basis of questionnaire. The questionnaire is administered on the selected employees
Effectiveness, of ABC Laboratories Ltd. The analysis has been made by applying statistical tools. The study is of
Corrective
and Preventive Actions (CAPA).
great significance to the organization and the researchers as it highlights the variables affecting
organizational effectiveness.
Copyright © Jain, V. K. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution,
and reproduction in any medium, provided the original work is properly cited.
Organizational effectiveness explains effectiveness of an The main objectives of the study are:
organization is in achieving the outcomes, it intends to
produce. The factors affecting the organizational effectiveness 1. To ascertain the factors which affect organizational
are varied and complex including organizational policies and effectiveness.
strategies, atmosphere of trust, openness and authenticity in the 2. To determine the inter-relations among these factors, if any
organization, sense of belongingness, pay, recognition and 3. To find out the inter-relation of each of these factors with
rewards, leadership styles, carrier opportunities, suggestions, organizational effectiveness.
opinions and advices from seniors culture composition, rules 4. To ascertain their relative contribution in the organizational
and regulations, freedom of work, training, check and balance, effectiveness
opportunity of condensed work week etc. Broadly, these
factors can be grouped into three categories including Work Scope of the Study
Environment, Job Satisfaction and OCTAPAC Culture.
ABC Laboratories Limited has several plants at various
Statement of the Problem locations in the country. The present study is however, limited
to one plant of the company located in Himachal Pradesh.
In the present time of increasing competition, it is very
difficult for an organization to survive unless it pays attention
to improve overall effectiveness at all levels in the Significance of the Study
organization. Organizational effectiveness is, therefore, is the
The study is of great significance to the employees and the
need of the hour. Considering its great significance, the present
organization as it provides an insight to the individual to
study focuses on studying the variables affecting the
ascertain the extent of Organizational Effectiveness and the
organizational effectiveness, their association and relative
factors contributing it. It also explains the inter relations
contribution. To understand the relationship among the various
among the major factors of Organizational Effectiveness. It
factors affecting Organizational Effectiveness, the present
will help the organization to study the nature of these
study was conducted in ABC Laboratories Limited.
relationships and improve its effectiveness by improving some
*Corresponding author: Jain, V. K. of the variables. It will also help the employees to improve
Department of Commerce & Management, G M N College, Ambala Cantt. their performance, job satisfaction and positive attitude.
(Haryana).
3796 Jain, V. K. A study of organizational effectiveness variables in Indian industries
METHODOLOGY
Company Studied
The company, ABC Laboratories Limited, is one of the largest
pharmaceutical company of India. It is an integrated, research
based, international pharmaceutical company. The company is
Organiational Effectiveness known for its R&D which facilitates generic research and
innovative research. The company has strong HR base and
Hypothesis of the Study takes keen interest in developing its human resources and
thereby increasing the efficiency of its people and overall
The study seeks to test the following null hypotheses: organizational effectiveness.
(1) Job Satisfaction, Work Environment and OCTAPAC Sample & Data Collection
Culture are not associated to each other.
(2) There is no significant relationship of Job Satisfaction and For the present study, one plant of the company located in
Organizational Effectiveness; Uttrakhand (India) has been selected. In all, 24 respondents
(3) No significant relationship exists between Work were selected for the study on random basis. Primary Data has
Environment and organizational Effectiveness; been used for the study. However, at appropriate places,
(4) There is no relationship of OCTAPAC Culture with secondary data in terms of organizational records and reports
Organizational Effectiveness; has also been used. The data on organizational effectiveness
(5) The three factors i.e. Job Satisfaction, Work Environment has been collected on the basis of questionnaire and personal
and OCTAPAC Culture do not contribute significantly to interaction with the employees, their superiors, peers and
the Organizational Effectiveness. employees of other departments. For this purpose Standardized
questionnaire‘74-item Organizational Effectiveness Scale
Limitations of the Study developed by Dhar & Dhar has been used. The questionnaire
was got filled through personal interaction with the
As the study is limited to only one plant of the company as respondents. 5-point scale was used in the questionnaire.
stated above, its results can be generalized to other plants of
the company only to a limited extent. Further, the results can Procedure
be compared with other companies with limitation to use of
different practices, people and policies. To simplify the data the 74 items used in the questionnaire
were grouped into three factors namely Job Satisfaction, Work
Review of Literature Environment and OCTAPAC Culture on the basis of nature of
variables. The responses of the respondents were converted
Review of Literature indicates that increased employee’s into quantitative data by using 5- point scale. The Work
performance accelerates organizational effectiveness and the environment included 28 items on organization’s perception to
effective organizational environment promotes the employee orientation, problem solving attitude of the
effectiveness of the organization (Malik et al., 2011). Mitchell superiors, realistic goals, information sharing and attitude of
(2002) in his article has also confirmed that the organizational the organization and superiors to people. Average Score of 28
performance depends upon motivation, environment and items of each respondent was termed as Work Environment
capacity which are similar to the factors undertaken in the Score and was used for the present study for further analysis.
present study. However, little efforts have been made so far to 19 items relating to employee motivation, rewards, employee
find out the relative contribution of these factors on contribution and work performance were taken under Job
Organizational Effectiveness. Present study is an attempt in Satisfaction. Total score of 19 items of each respondent was
this regard. Mufeed (2006) has made an attempt to identify the averaged and termed as Job Satisfaction Score. This score was
major factors responsible for non-promoting of organizational used for further analysis in the present study. The OCTAPAC
effectiveness among the managerial and non-employees about culture consisted of 27 items on trust, openness, freedom of
the prevailing OCTAPACE culture with special reference to work, initiative orientation, co-operation etc. Their score was
Tourism sector. Efforts have been made by some researchers also averaged for each respondent and was considered as
inclusing Geetha Priyadarsshini (2004); Mishra, Dhar & Dhar OCTAPAC Score which was used for the analysis in the study.
3797 International Journal of Current Research, Vol. 5, Issue, 12, pp.3795-3801, December, 2013
Similarly, the total score of 74 items of each respondent was The most important variables contributing to the
averaged to determine the Organizational Effectiveness Score Organizational effectiveness seems to be ‘Job Satisfaction’
and was applied in deriving results. The analysis has been with a mean score 3.83 (percentage score 70.76 per cent)
made by using statistical tools. For this purpose, descriptive which is an indication of ‘Good’ organizational practices for
statistics -Mean and Standard Deviation and Correlation and employee recognition and reward, employee welfare and
Regression was used and tests of significance were applied superior-subordinate relationship.
through SPSS software. The mean score on OCTAPAC Culture is 3.67
(66.75percent)and 3.54 (63.625 per cent) on Work
Analysis and interpretation Environment indicating ‘Reasonably Good’ HR practices,
employee oriented policies and atmosphere of trust, openness,
This section presents analysis of the organizational co-operation and pro-activity in the company.
effectiveness of ABC Laboratories to understand the various
It appears that the company can improve Organizational
factors which contribute to the effectiveness and their inter
effectiveness by improving some of the factors relating to
relation. For this purpose, standardized ‘Organizational
work environment and OCTAPAC culture.
Effectiveness Scale (OES)’ developed by Dhar & Dhar has
been used. The relationship and impact of three factors namely Correlation Analysis
Work Environment, Job Satisfaction and OCTAPAC Culture
on the Organizational effectiveness has been studied by using Inter correlations among the variables were studied as per Karl
correlation and regression techniques. Pearson’s Product Moment Correlation Method. For the
purpose of understanding the relationship pattern among the
Descriptive Analysis factors, the data pertaining to 24 respondents has been taken.
The correlations among the three factors i.e. work
Frequency distribution for all the organizational effectiveness
environment, job satisfaction and OCTAPAC culture along
factors explaining their mean, standard deviation, and
with OES scores are shown in the Table - 2 given below.
percentage mean scores are presented in Table-1. Percentage
Mean Score has been calculated on the basis of formula used Table 2. Correlation Analysis
by Rao (1991) i.e. Work Job OCTAPAC OES
Environment Satisfaction Culture Scores
Percentage Score = (Mean Score – 1) x 25 Work 1
Environment
The mean score for each item ranges for 1.0 to 5.0 where 1.0 Job Satisfaction 0.625(**) 1
indicates extremely poor existence of that factor and 5.0 OCTAPAC .764(**) .666(**) 1
indicates extra-ordinary presence of the factor contributing Culture
OES Scores .938(**) .774(**) .914(**) 1
maximum to the Organizational effectiveness. Scores around
** Correlation is significant at the 0.01 level (2-tailed).
4.0 indicate good score of that factor which positively affects
the organizational effectiveness. Score around 3.0 represents Relationship between Work Environment and Job
an average contribution of that factor and good scope of Satisfaction
improvement on that dimension. Similarly scores around 2.0
reflects poor presence of that factor. The same interpretation The correlation between Work Environment and Job
can be offered for percentage scores. A mean score of 1.0 Satisfaction (0.625) is highly positive and significant
corresponds to zero percent and 5.0 correspond to 100 percent. explaining that these variables are highly associated. The
It is certainly desirable for the organization to have percentage highly positive correlation is due to the conducive work
score above 50 percent on each factor. Percentage score above environment having progressive orientation where the criteria
60 percent is indicative of reasonably good Organizational of success are clearly determined. Employees perceive fairness
Effectiveness. The analysis of Organizational Effectiveness in in standards and policies of organization as they are guarded
ABC Laboratories Limited under study has been made on by legal provisions i.e. Whistle Blow Policy, emphasis on
these parameters. effectiveness and employee development is taken into
Table 1. Descriptive Analysis consideration via training need assessment, and there are
adequate standards of control to ensure that training is taken
Mean Standard Deviation % Mean Score seriously by employees which is done via LMS. Superiors and
Work Environment 3.5450 .34455 63.625 top management also provide guidance in terms of day to day
Job Satisfaction 3.8304 .16446 70.760 planning and proper opportunity to employees to monitor the
OCTAPAC Culture 3.6700 .24347 66.750 success. This has resulted in Job Motivation among employees
OES Scores 3.6663 .23761 66.575
where employees are ready to put extra efforts at the time of
From the above table, it can be ascertained that: requirement without expectation for reward or overtime
payment of salary. Another aspect which enhances Job
The general mean score of all the factors of Organizational satisfaction is Transparency in the process of performance
Effectiveness in ABC Laboratories Limited seems to be evaluations well as freedom for expression of ideas. Because
‘reasonably good’, ranging between3.55 and 3.84 (63.63 to of Job Satisfaction, employees are keen to solve problems by
70.76 per cent). It shows that there is further scope of themselves at initial stages by applying various tools like
improvement of each factor. The average OES score of 3.666 CAPA (Corrective and Preventive Actions). The employees
(66.575 per cent) also indicates that there is need to improve respond equally to both problem as well as opportunities as
the Organizational Effectiveness further. they believe themselves as an integral part of the organization,
3798 Jain, V. K. A study of organizational effectiveness variables in Indian industries
having similar values to that of organization. However, there is significant at one per cent level. The inter-relations between
less freedom for experimentation or to act according to once the two factors is quite evident form the reasons stated above.
own judgment as pharmaceutical company is regulated by The employees seem to be satisfied due to the better superior
norms and laid procedure. Thus, prior approval of HOD is subordinate relationship, recognition of employees for their
required before implementation. Organization also provides good work, rewards, employee welfare measures, atmosphere
opportunity to employees in terms of Job rotation. Thus, Job of trust and openness, co-operation among the employees,
satisfaction further enhances work environment where positive attitude towards the employee problems etc. As
organization is ready to redefine its objectives in light of new indicated earlier, the organization uses several mechanisms for
events and its employees are also ready to work in accordance the employee development. Training needs are assessed
with redefined objectives by generation innovative as well as properly and employees are given training from time to time.
feasible ideas. To solve employee problems CAPA analysis is used. KRA’s
Work Environment and OCTAPAC Culture are stressed and employees are helped to improve their
performance. Problems and allied issues of the employees are
The relationship between Work Environment and OCTAPAC solved through open forums to their satisfaction. The superiors
Culture(0.764)was found to be highly positive and statistically also support them not only in solving their issues but also
significant at one per cent level. This can be explained on the overcoming stress and frustration. It motivates them to work
basis of the fact that there prevails the environment of freely in the organization. Performance Appraisal is used as a
Openness, Confrontation, Trust, Authenticity, Pro-activity, mechanism for employee assessment, development,
Autonomy and Collaboration. It is evident that chances of advancement and compensation. It can be ascertained that all
advancement in the jobs are high due to Facilitation, the three factors Work Environment, Job Satisfaction and
cooperation among co-workers as well as supportive aptitude OCTAPAC Culture are closely related to each other and the
of top management. This has resulted in high chances of future level of relationship was found to be statistically significant.
growth for employees. Employees are trained on the basis of
Training Need Assessment and they are also provided OES Scores and Work Environment, Job Satisfaction &
feedback on scheduled bases. Also, Job Rotation between inter OCTAPAC Culture
departments are planned for the overall development of
employees. Thus, the future growth of employees is also kept The inter relation between OES and Work Environment
in mind while Job Designing. Trust and cooperation among (0.938), OES and Job Satisfaction (0.774)& OES and
employees also contribute in creation of positive and OCTAPAC Culture (0.914) was found to be statistically
conducive work environment. It has been observed that people significant at one per cent level. High correlation of OES was
support as well as cooperate with each other irrespective of observed with work environment and OCTAPAC culture
hierarchical level, one of the reasons being inter dependence (>0.9). It reflects that the OES is closely associated with these
nature of work. Transparency, another important factor for two factors. Job Satisfaction also has quite significant
positive work environment is also prevalent in organization to association with the organisational effectiveness. This
a large extant. This can be explained from the fact that the association can be further improved by raising satisfaction of
objectives of the organization are clearly communicated so that the employees who are somehow dissatisfied. As indicated in
one can relate them to day to day responsibilities so as to the personal interaction, some of the employees complained
enhance efficiency as well as morale of the employees. There about the biasness in the appraisal system and the KRA
also prevails Collaboration among various departments. This ratings. This can be made more transparent to enhance job
results in well-defined goals and prevents duplication of work satisfaction and organizational effectiveness. On the basis of
thereby enhancing the efficiency of organization in above discussion, it can be concluded that the three factors i.e.
accomplishing the goals within given time frame. This further Work Environment, Job Satisfaction and OCTAPAC Culture
enhances cooperation among employees. Moreover, difficult are closely associated with each other and the Organizational
problems are solved by teamwork under the guidance of Effectiveness as well.
superior by applying various tools like CAPA analysis. Hence, the null Hypothesis
Superiors also make efforts by assigning challenging
assignment and maintain group dynamics in order to establish a. That there is no association between work environment,
humane relationship among employees. This also enhances Job Satisfaction and, OCTAPAC Culture is rejected.
confidence and build up morale of employees. If there is b. That there is no significant relationship of Job Satisfaction
conflict among the view point of employees, it is solved by and Organizational Effectiveness; Work Environment and
positive synergy where different viewpoints are debated upon organizational Effectiveness; OCTAPAC Culture and
to gain maximum from them. Superiors encourage their Organizational Effectiveness are also rejected.
employees to think out of the box and apply innovative ideas
effectively in various cost saving measures, to balance Regression Analysis
schedule and resource constrains without affecting quality of
the product. Organization also makes efforts to identify and In order to arrive at some meaningful conclusion regarding the
develop potentials of the employee by involving them in relative contribution of the independent variables on
challenging tasks, delegating authorities and responsibilities Organizational Effectiveness in ABC Laboratories, the co-
and providing training etc. efficient of Multiple Regression (bs), the co-efficients of
determination (R2) and the value of F as a measure of testing
Job Satisfaction and OCTAPAC Culture the fitness of regression has been obtained. For the purpose of
The relationship between Job Satisfaction and OCTAPAC computing these values, SPSS software was used. The results
Culture 0.666was found to be positive and statistically are being discussed as under:
3799 International Journal of Current Research, Vol. 5, Issue, 12, pp.3795-3801, December, 2013
The co-efficient of determination R2 (adjusted) between the 3. The factors used in the study namely Work Environment,
Organizational effectiveness and the three independent factors Job Satisfaction and OCTAPAC Culture also seem to be
is .991 as shown in table 3(b) above. It can be inferred that 99 highly associated with Organizational Effectiveness
per cent variations in the organizational effectiveness is Scores. High degree of inter-relation was observed between
explained by the independent variables including Work Work Environment and OES (0.938) and OCTAPAC
Environment, Job Satisfaction and OCTAPAC Culture. The Culture and OES (0.914). All the inter-relations were found
value of F for the present regression has been found to be to be statistically significant at one per cent level. It
statistically significant. As regards the individual contribution indicates that Organizational Effectiveness is directly
of each factor to the Organizational Effectiveness, OCTAPAC affected by these factors.
Culture has the highest contribution (0.38) followed by Work 4. All the factors contribute significantly to the
Environment (.36) and the Job Satisfaction (0.27). These Organizational Effectiveness as evident from the regression
regression co-efficients were found to be statistically analysis. It is significant to note that 99 per cent variations
significant. It appears that all the three factors have significant in the Organizational Effectiveness are explained by the
contribution in improving organizational efficiency. As the three independent variables used in the study, their relative
three factors - Work Environment, Job Satisfaction & contribution being Work Environment (0.36), Job
OCTAPAC Culture contribute significantly to the Satisfaction (0.27) and OCTAPAC Culture (0.38). It can be
Organizational Effectiveness, the null hypothesis is rejected. inferred that the organizational effectiveness is largely
dependent on Work Environment, Job Satisfaction and
Findings and Conclusion OCTAPAC Culture in an organization.
On the basis of the above study, it can be ascertained that Implications
1. The mean value for all the dependent and independent The study is of great significance to the organization as it
factors in the study was found to be greater than 3.5 (> 0.62 explains the relationship and the contribution for the various
per cent), indicating existence of ‘reasonably good’ work factors on Organizational Effectiveness. The organization can
environment, Job Satisfaction and OCTAPAC Culture improve its effectiveness by improving these variable. Further,
along with Organizational Effectiveness in the the study confirms the results of the earlier study which also
organization. Further, there is consistency in the data as identified the same type of factors i.e. Work Environment, Job
revealed by the Standard Deviation. It can be assumed that Satisfaction and OCTAPAC Culture affecting Organizational
the organization pays attention to employee development, Effectiveness.
training needs, compensation and reward system, Recommendations
appropriate recognition to motivate its employees,
maintains an atmosphere of trust , transparency and To improve the factors including Work Environment, Job
openness, pays attention to superior-subordinate Satisfaction and OCTAPAC Culture and to raise the
relationships and applies good HR practices. Organizational Effectiveness, the following recommendations
2. There is close inter relationship between Work are suggested:
Environment and Job Satisfaction (0.625); Work 1. There is need to remove biasness in the Performance
Environment and OCTAPAC Culture (0.666) and Appraisal System. It should be made more transparent.
OCTAPAC Culture and Job Satisfaction (0.764). Further, 2. Employees should be given opportunity to use their ideas.
this relationship was found to be statistically significant. It
can be inferred that all the three factors are closely
3. KRA’s (Key Result Areas) should be discussed with the
employees and the ratings on the basis of KRA’s should
associated to each other and improvement in any one of
also be made known to the employees with reasons.
them will lead to better the relationships with others.
3800 Jain, V. K. A study of organizational effectiveness variables in Indian industries
Appendix
The respondents are requested to tick mark ( ) their preference in the relevant box of HRD Climate Scale Questionnaire. The preferences have been converted
into quantitative form as indicated below:
*******