Academic journal article Journal of Management Research

Characteristics of High Performance Organisations

Academic journal article Journal of Management Research

Characteristics of High Performance Organisations

Article excerpt

Abstract

The recent economic downturn has caused tremendous upheaval in the business world. It has spurred many companies to self-analysis and further organisational improvement. As a result, there is an increasing interest into the factors that determine sustainable organisational success. Managers all over the world are trying out various improvement concepts, seeing mixed results. One likely reason for this is the lack of consensus on the organisational characteristics that lead to high performance. Another reason may be that research into high performance is predominantly conducted in US companies, making it seem less relevant to management practice outside the North American continent. The research study described in this article aims at identifying the factors which have a positive relation with organisational performance. Through review of 290 research studies into high performance and subsequent testing in 1470 organisations worldwide, 35 characteristics - grouped into five factors - were identified which have a correlation with high performance and seem to be generic. The research results provide managers with a framework that adds focus to their continuous improvement efforts.

Keywords: High performance Organisations, Excellence, Sustainability, Quality

1. Introduction

According to Colvin (2009) the world changed fundamentally in 2007 when the credit crisis hit, eventually causing the most severe recession since the 1930s (Colvin, 2009). A wave of trends and developments, like globalization (Lawrence, 2002; Bakker et al., 2004; Starbuck, 2005; Schuster and Copeland, 2006; Sirkin et al., 2008; Ramamurti and Singh, 2009), new technology (Sadler, 2002; Malone, 2003; Light, 2005), ascension of Asian markets and especially India and China (Backman and Butler, 2007; Kamdar, 2007; Nath, 2008; Nobrega and Sinha, 2008), environmental issues (Rosen, 2000) and demographic shifts (Rosen, 2000; Martin, 2002), was hitting the business world at the same time as the credit crisis was going on and thus helped to reshape the global business economy. Many authors (Kely, 2006; Charan, 2009; Flatters and Willmott, 2009; Guth, 2009; Hagel et al., 2009; Kotler and Caslione, 2009) agree with Colvin but not all. Main critic is Mintzberg who finds that little has changed in the activities of managers between the 1970s and 19902 (Mintzberg, 1973, 2009). Apart from using new tools like e-mail, managerial work remained essentially the same. Mintzberg in turn is supported in his opinion that the fundamentals of the global business economy have not changed by Tengblad (2000, 2006), Hales (1996, 1999, 2000) and several other researchers (Watson, 2001, Tolmie et al. 2003). It seems that there is no consensus among researchers on whether or not business fundamentals have changed, leaving as yet the following question unanswered: 'What organisational or business models might be proposed, whether existing in the past or at present or drawn from scratch, as potential solutions to the problem of designing the firm for sustainable high performance in changing circumstances?' (Freeman and Zollo, 2009).

To find an answer on this question, we turned to research into factors that may explain long-term success of firms and which can be used to develop a framework for building sustainable organisations. In the wake of the landmark book In Search Of Excellence (Peters and Waterman, 1992) and the bestsellers Built To Last (Collins and Porras, 1994) and Good to Great (Collins, 2001), there has been a strong interest among academics and managers in identifying these high performance factors (O'Reilly III and Pfeffer, 2000; Hess and Kazanjian, 2006; Porras et all., 2007; Thoenig and Waldman, 2007; Gottfredson and Schaubert, 2008; Simons, 2008; Tappin and Cave, 2008; Spear, 2009). Research into factors that cause or facilitate high performance is driven by developments in the resource-based view of the firm (Lockett et al., 2009) and the theory of dynamic capabilities (Peteraf and Barney, 2003; Easterby-Smith et al. …

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