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CONTRIBUTORS:
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CONFERENCE NAME:
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CONF. LOCATION:
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Atlanta, GA
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CONFERENCE YEAR:
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2006
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PUB TYPE:
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Conference Presentation
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SUBJECT(S):
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Organization Performance, Customer-related practices, effciency-related practices, employee-related practices
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DISCIPLINE:
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Business/Management
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HTTP:
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LANGUAGE:
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English
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PUB ID:
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103-429-281
(Last edited on
2006/08/13 15:47:34 GMT-6)
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SPONSOR(S):
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ABSTRACT:
Many studies have examined the effects of specific practices on criteria drawn from a single functional area (e.g., sales, employee satisfaction, and production efficiency). In contrast, the present research integrates the effects of practices from multiple functional areas on organization performance. Although, to our knowledge, this is the first investigation to undertake this endeavor, the idea is not original to us. In Administrative Behavior, Simon (1945/1997) described a business organization as a political coalition with three key participants—an entrepreneur, customers, and employees. We propose a model that uniquely conceptualizes organizations as both political coalitions (Simon 1945/1997) and economic input/output transformation processes (Katz & Kahn 1966/78). To date, no theoretical or empirical research has been conducted that combines these perspectives. But the need for both seems obvious. Hypotheses derived from theorized relationships are tested using structural equation modeling and multiple regression analysis.
Three portfolios of 26 practices each–Employee Directed Practices, Customer Directed Practices, and Enterprise Directed Practices–were created based on 1156 responses to a questionnaire comprised of 137 practice statements. The data supported five of six hypotheses, and demonstrated a sizable and significant link between the practices employed and organization performance (a large effect size explaining 59 percent of the variance). This is contributory in two respects: conceptually by proposing and testing a new model of the determinants of organization performance, and empirically by finding a large effect size relationship. With the refinement of methodology and establishment of norms, this model may have practical utility, providing managers a tool to diagnose and intervene effectively in improving organization performance.
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