Improving Organizational Effectiveness

Theoretical Framework and Model

Working paper for the HFM-163/RTG Working Group
Esther Bisig, Tibor Szvircsev Tresch & Stefan Seiler
Swiss Military Academy at the ETH, Zurich

The Project
Research

In December 2007, NATO initiated the HFM-163/RTG project which aims to

Interest

investigate the organizational effectiveness of peace-promoting multinational

coalition operations particularly the effectiveness of NATO headquarters of such
operations and, where possible, to submit recommendations.

Projects Goals

The goals of this project are as follows: 1) to define what is commonly understood by
organizational effectiveness, 2) to outline which theories and models of
organizational effectiveness exist, 3) to assess how these models can be combined
to a new model of organizational effectiveness of peace-promoting multinational
operations' headquarters, 4) to investigate what factors influence this effectiveness,
5) to understand how it can be measured and last but not least, 6) to actually collect
data and prove the new model.

Definition of Organizational Effectiveness

Definition

Generally speaking, the term of organizational effectiveness describes the degree to

which an organization realizes its goals (ETZIONI 1964).

Headquarters

From an experts discussion resulted that the main goal of a NATO headquarters in

Goal

a peace-promoting operation is to support the troops on the ground. Furthermore, it

was noted that this goal can only be realized effectively by a) information sharing, b)
quick and timely decision making, and c) shared awareness of tasks and
responsibilities.
In the following, factors influencing this goal achievement will be deducted from
previous theory and research on organizational effectiveness
Previous Research on Organizational Effectiveness
The research on and the measurement of organizational effectiveness focuses on
different parts of the organization.
Organizations bring resources in from the environment, and those resources are
transformed into outputs delivered back into the environment (Fig. 1).
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External Environment

Resource
Inputs

System
resource
approach

Organization
Internal activities
and processes

Internal
process
approach

Product and
Service
Outputs

Goal
approach

Fig. 1: Approaches to Organizational Effectiveness (DAFT 1998)

System

The system resource approach assesses effectiveness by observing the beginning

Resource

of the process and evaluating whether the organization effectively obtains resources

Approach

necessary for high performance.

The system resource approach is valuable when other indicators of performance are
difficult to obtain. In many not-for-profit and social welfare organizations, for
example, it is hard to measure output goals or internal efficiency
Although the system resource approach is valuable when other measures of
effectiveness are not available, it does have shortcomings. Often the ability to
acquire resources seems less important than the utilization of those resources.
(DAFT 1998).

Internal

The internal process approach looks at internal activities and assesses effectiveness

Process

by indicators of internal health and efficiency. The internal process approach is

Approach

important because the efficient use of resources and harmonious internal functioning
are ways to measure effectiveness. A significant recent trend in management is the
empowerment of human resources as a source of competitive advantage. Most
managers believe participative management approaches and positive corporate
culture are important components of effectiveness.
The internal process approach does have shortcomings. Total output and the
organizations relationship with the external environment are not evaluated. Also,
evaluations of internal health and functioning are often subjective, because many
aspects of inputs and internal processes are not quantifiable. Leaders should be
aware that efficiency alone represents a limited view of organizational effectiveness
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(DAFT 1998).
Goal Approach

The goal approach to organizational effectiveness is concerned with the output side
and whether the organization achieves its goals in terms of desired levels of output.
The goal approach is mostly used in business organizations because output goals
can be readily measured. Business firms typically evaluate performance in terms of
profitability, growth, market share, and return on investment.
However, identifying operative goals and measuring performance of an organization
are not always easy. Two problems that must be resolved are the issues of multiple
goals and subjective indicators of goal attainment. (DAFT 1998).
The three approaches system resource, internal process, and goal approach to
organizational effectiveness described here all have something to offer, but each
one tells only one part of the story (DAFT 1998).
Existing Models of Organizational Effectiveness
This is the reason why we are now looking at several existing models with different
approaches to

organizational

effectiveness;

namely:

the Command

Team

Effectiveness (CTEF) Model (ESSENS ET AL. 2005), the Dynamic Five-Factors Model
of Leadership (SEILER & PFISTER under review), the Star Model (GALBRAITH 2002),
and the 7-S-Model (PETERS & W ATERMAN JR. 1982). Later, we will try to integrate
and combine their conceptual ideas and indicators to a new, single framework for
organizational effectiveness of peace-promoting multinational coalition operations'
headquarters.
CTEF Model

The CTEF model (Fig. 2) makes possible observing, evaluating and promoting group
activities. The model assumes that successful leaders have to understand and take
into account the following factors: 1) conditions (operation framework, task,
organization, leader, team members, team), 2) behavior and processes occurring
during the operation (a distinction is made between behavior/processes related to
tasks and those related to groups), 3) evaluating the result of these processes
(again distinguishing between behavior related to tasks and to groups), and 4)
adapting processes and conditions in order to become more effective.

Fig. 2: CTEF-model (ESSENS et al. 2005)

This model was developed by a working group of the NATO Research and
Technology Organization. Existing models were used as an inspiration to identify the
factors (e.g. DRISKELL, SALAS, & HOGAN 1987; SALAS, DICKINSON, CONVERSE &
TANNENBAUM 1992; KLIMOSKI & JONES 1995; BLENDELL, HENDERSON, MOLLOY &
PASCUAL 2001; all as cited by ESSENS ET AL. 2005). Moreover, articles and chapters
on organizational effectiveness were consulted and interviews with experts were
conducted.
The advantages of this model are its strong theoretical foundation; the fact that it
includes learning and adjustment loops and that it takes the mission framework and
context into consideration.
However, in regard to multinational peace-promoting operations, this model lacks
the (inter-)cultural aspects. Additionally, it focuses very much on team and task
characteristics, which does not correspond to a headquarters perspective. On the
HQ level, there are other emphases and vulnerabilities, e.g. organizational culture
and structure. Yet another weakness of the CTEF model is the complex cause-andeffect structure, which in practice can only be verified partially.
Five Factors

The Five Factors Model of Intercultural Leadership Behavior (Fig. 3) presumes that

Model of

competent leadership in an operation is based on more than just individual

Intercultural

competence 1). Additionally, the behavior of a leader is influenced by 2) the

Leadership

dynamics of the team the leader works with, 3) by the organizational framework, 4)

Behavior

by the present context and 5) by the particular situation the leader is faced with.

Individual Competence

Team/Group

Situation
Intercultural
Leadership Behavior

Context

Organization

Fig. 3: Dynamic Five-factors Model of Leadership (SEILER & PFISTER under review)

A big advantage of the Five Factors Model is its focus on intercultural aspects of
leadership behavior. In military coalition operations, successful collaboration
between troops of different countries, international partners and the population on
site is pivotal for success. Hence, intercultural competence is a key factor for
organizational effectiveness in a NATO HQ. Another advantage is that it includes the
external environment into the evaluation.
The main disadvantage of this model in our case is the fact that it is a leadership and
not an effectiveness model. Therefore it does not specify how effective leadership is
linked with organizational effectiveness.
Star Model

The basic premise of the Star Model (Fig. 4) is simple but powerful: different
strategies require different organizations to execute them.
The Star Model framework for organizational design is the foundation on which an
organization bases its design choices. This framework consists of a series of design
policies that are controllable by leadership and can influence employee behaviour.
The policies are the tools with which leadership must become skilled in order to
shape the decisions and behaviours of their organizations effectively.
In the Star Model, design policies fall into five categories: strategy, structure,
processes, rewards and people.

Fig. 4: The Star Model (GALBRAITH 2002)

For an organization to be effective, all these policies must be aligned, interacting

harmoniously with one another. This idea of alignment is fundamental to the Star
Model.
But to solely focus and align the organization is to become vulnerable because
alignment around a focused strategy can impede to a new strategy.
Today, every organization needs to be adaptive and change as quickly as its context
changes. If not, it is falling behind. And if change is constant, we need to design our
organization to be constantly and quickly changeable. We need to have organization
structures and processes that are easily reconfigured and realigned with a
constantly changing strategy. This asks for the skilled use of extensive internal and
external networking capabilities. (GALBRAITH 2002)
One advantage of this model is the concept of strategic alignment. This alignment of
the diverse policies ensures goal-oriented working and therefore organizational
effectiveness. Another advantage of the model is the consideration of the
adaptability to a constantly changing environment.
Nevertheless, the Star Model is not tailored to the organization of a NATO HQ but
rather to business and market-oriented companies. Another two weak points are 1)
that effectiveness is not a direct output of the design policies, and 2) that culture is
only understood as an output and not as an input to the organization. But in a
multinational headquarters, where people from different nations are working
together, culture certainly also is an entry.
7-S-Model

The 7-S-Model of the former McKinsey management consultants PETERS and

WATERMAN JR. (1982) divide organizations into hard and soft factors. The hard
factors cover elements more concrete and can be exposed with policy papers, plans

and documentations on the development of the organization. The three hard or

cold factors of an organization are: 1) strategy, 2) structure, and 3) systems. The
expression soft refers to substantially and only marginally concrete elements of an
organization that can hardly be described. These elements develop permanently,
and can be planed or controlled only limitedly because they are highly dependent on
the members of the organization. These soft or warm factors are namely: 4) skills,
5) staff, 6) style/culture, and 7) shared values / super ordinate goals (Fig. 5). While
the hard factors are easier to test, the assessment of the soft factors is much more
difficult - but they are at least as important for the organization.

Fig. 5: The 7-S-Model (PETERS & W ATERMAN JR. 1982)

Effectively functioning organizations are characterized by a coordinated balance of

theses seven factors. In times of change and adjustment, it should be noted that the
modification of one factor also impacts on the other factors. A well-functioning
organization must aspire towards a right balance between the above introduced
factors. In practice, it is often the case that leaders are only focusing on the hard
factors. PETERS and W ATERMAN JR. (1982) argue, however, that the most successful
organizations put their attention also on the optimum balance of the soft factors as
they can be decisive for success because new structures and strategies can barely
be built on completely opposed cultures and values.
This praxis proven model has the advantage that 1) it takes into consideration hard
as well as soft factors, and 2) that it emphasizes the importance of a balance
between those factors.
Summary

The four models just discussed above have different foci and cover different aspects
of organizational effectiveness, yet they have many similarities.
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To sum up, we expect the following concepts and components of a new model for
multinational coalition operations headquarters:
a direct link from the input factors through the transformation processes to the
goals of the organization
the concept of strategic alignment which states that the input factors must be in
optimum balance to result in effective goal achievement
consideration of hard (e.g. structures, processes) as well as soft (e.g. people,
culture) input factors
inclusion of the external environment; specifically the ability of the organization to
adapt and adjust to the constantly changing situation and context
and last but not least, a simple model which can be easily applied in practice
New Model
On this basis we are now developing a new model in order to capture the
effectiveness of military coalition operations headquarters (Fig. 6). In the following
paragraph, each component will be briefly described.

Fig. 6: Model of Organizational Effectiveness of Peace-Promoting Multinational Coalition Operations

Headquarters

Goal

As stated earlier, organizational effectiveness means goal achievement. The main

Achievement

goal of NATO multinational coalition operations headquarters is to support the

troops on the ground.

Transformation

Our model hypothesizes that the transformation processes, which include 1)

Processes

information sharing, 2) quick and timely decision making, and 3) developing a

shared awareness, influence the effectiveness of a military coalition operations
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headquarters. GALBRAITH (2002) also supports the assumption that these three
factors are needed to meet an organizations goal effectively. ESSENS ET AL. (2005)
say that effectiveness is tied to the ability to acquire the lacking information and to
manage the information it possesses. Three features are important obtaining,
processing, and exchanging information. They also assume that the effectiveness of
a team is defined by the quality and efficiency of its decisions. PETERS and
WATERMAN JR. (1982) expect that shared understanding of what the organization
stands for and what it beliefs in is central for its effectiveness. Thus, a clear
understanding of the mission is essential for organizational effectiveness, as is
retaining the same mission objective (ESSENS et al. 2005).
Input factors

The three factors (information sharing, decision making and shared awareness) in
turn depend on the interaction of four influencing factors; these are: 1) structure, 2)
people, 3) processes, and 4) culture.

Structure

The Structure is understood as the way organizational units are related to each other
and determines the location of the decision-making power and authority in the
organization. (GALBRAITH 2002; PETERS & WATERMAN JR. 2005). Additionally
important is the aspect of organizational infrastructure. Are there adequate
resources and communication channels in place to facilitate interaction and
knowledge transfer? (SEILER & PFISTER under review)

People

The People factor include selection, rotation, training, and development (GALBRAITH
2002). Additionally important is the embedding of new members (PETERS &
WATERMAN JR. 1982) and the internal networking (GALBRAITH 2002). Another central
area within the People factor is leadership. Research demonstrates that an effective
leader can have a positive impact on effectiveness (HOGAN, CURPHY & HOGAN 1994;
JUDGE, PICCOLO & ILLIES 2004; and KURECA, AUSTIN, JOHNSON & MENDOZA 1982).
Within leadership we focus in the capabilities of the leader, his skills and knowledge.
In order for leaders to be successful in an organization, they must be 1) strategically
(e.g. planning, conflict resolution), 2) professionally (e.g. expertise), 3) socially (e.g.
communications, cooperation, support), 4) cognitively (e.g. knowledge, intelligence),
5) individually (e.g. stress resistance, self criticism), and 6) interculturally (e.g.
foreign language skills, tolerance of ambiguities) competent (BOLTON 2005; as cited
in SEILER & PFISTER under review).

Processes

By Processes is meant the way the organization implements its goals in the
framework of the given structures (PETERS & WATERMAN JR. 1982). That is to say
that information and decision processes cut across the organizations structure; if
structure is thought of as the anatomy of the organization, processes are its
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physiology or functioning (GALBRAITH 2002). This functioning involves managing

information, assessing the situation, making decisions, planning, directing,
controlling, networking, providing and maintaining vision and common intent,
motivating, and adapting to context and situation (ESSENS ET AL. 2005). The
adaptability to the external environment is especially important as effectiveness can
only be achieved if the organization as a whole is willing to adapt its structures,
where necessary, to the ever-changing conditions (SEILER & PFISTER under review).
Culture

Culture is divided into three components: 1) organizational culture, 2) leadership

culture, and 3) national cultures. PETERS and W ATERMAN JR. (1982) also distinguish
between 1) the organizational culture as the dominant values and norms that have
developed over time and become stable elements of the headquarters and 2)
management style as the general manner, outlook, attitude, and behaviour of a
leader in his or her dealings with subordinates. In multinational coalition operations,
national culture must certainly be added as a third cultural component.

Strategic

Most important for effectively achieving goals is that the four factors Structure,

Alignment

People, Processes, and Culture are strategically aligned towards the organizational
goals.

Usability
Instrument

This new model's scope and simplicity allow for a construction of an instrument
which measures effectiveness in a particular context like a NATO multinational
coalition operations' headquarters.
One application possibility of the model is for example 1) identifying the current state
of each factor in the headquarters and 2) describing the generally perceived
influence of each of these factors on effectiveness.
On the basis of the collected data and taking into account the mutual interaction of
the factors can be 1) investigated the impacts of different influencing factors, 2)
localized inefficiencies in NATO headquarters 3) determined measures to achieve
better organizational effectiveness, and 4) proved and if necessary adapted the
newly developed model.

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