Literature based characteristics of high performing organizations – a review

According to the literature, high performing organizations (HPO) tend to share similar characteristics. Professor de Waal, the academic director at the Center for Organizational Performance based in the Netherlands, proposed a framework to analyse these factors in his latest paper (de Wall 2010). The literature analysis presented here was based on the review of 262 academic and corporate sources (non english and grey literature excluded).

A new method of literature review – the systematic review – was applied here to address the topic of high performance organizations. The insights extracted from the literature are articulated and presented in a framework developed by de Waal ( 2008, 2010a, b). The paper will only focus on the thematic findings of this literature review and its greatest contribution is the overview of academic and practice work aimed at understanding the secrets of top management practices. The identified success factors of organizations are presented below:

These factors include following capabilities (follow the links provided to each marked key word to discover current management thinking):

Organizational design characteristics

• D1. Stimulate cross-functional and cross-organizational collaboration.
• D2. Simplify and flatten the organization by reducing boundaries and barriers between and around units.
• D3. Foster organization-wide sharing of information, knowledge and best practices.
• D4. Constantly realign the business with changing internal and external circumstances.

Strategy characteristics

• S1. Define a strong vision that excites and challenges.
• S2. Balance long-term focus and short-term focus.
• S3. Set clear, ambitious, measurable and achievable goals.
• S4. Create clarity and a common understanding of the organization’s direction and strategy.
• S5. Adopt the strategy that will set the company apart.
• S6. Align strategy, goals, and objectives with the demands of the external environment and build robust, resilient and adaptive plans to achieve these.

Process characteristics

• P1. Design a good and fair reward and incentive structure.
• P2. Continuously innovate products, processes and services.
• P3. Continuously simplify and improve all the organization’s processes.
• P4. Create highly interactive internal communication.
• P5. Measure what matters.
• P6. Report to everyone financial and non-financial information needed to drive improvement.
• P9. Strive for continuous process optimalization.
• P8. Strive to be a best practice organization.
• P9. Deploy resources effectively.

Technology characteristics

• T1. Implement flexible ICT-systems throughout the organization.
• T2. Apply user-friendly ICT-tools to increase usage.

Leadership characteristics

• L1. Maintain and strengthen trust relationships with people on all levels.
• L2. Live with integrity and lead by example.
• L3. Apply decisive action-focused decision-making.
• L4. Coach and facilitate.
• L5. Stretch yourselves and your people.
• L6. Develop effective, focused and strong leadership.
• L7. Allow experiments and mistakes.
• L8. Inspire the people to accomplish extraordinary results.
• L9. Grow leaders from within.
• L10. Stimulate change and improvement.
• L11. Assemble a diverse and complementary management team and workforce.
• L12. Be committed to the organization for the long haul.
• L13. Be confidently humble.
• L14. Hold people responsible for results and be decisive about nonperformers.

Individuals & Roles characteristics

• I1. Create a learning organization.
• I2. Attract exceptional people with a can-do attitude who fit the culture.
• I3. Engage and involve the workforce.
• I4. Create a safe and secure workplace.
• I5. Master the core competencies and be an innovator in them.
• I6. Develop people to be resilient and flexible.
• I7. Align employee behaviour and values with company values and direction.

Culture characteristics

• C1. Empower people and give them freedom to decide and act.
• C2. Establish strong and meaningful core values.
• C3. Develop and maintain a performance-driven culture.
• C4. Create a culture of transparency, openness and trust.
• C5. Create a shared identity and a sense of community.

External orientation characteristics

• E1. Continuously strive to enhance customer value creation.
• E2. Maintain good and long-term relationships with all stakeholders.
• E3. Monitor the environment consequently and respond adequately.
• E4. Choose to compete and compare with the best in the market place .
• E5. Grow through partnerships and be part of a value creating network.
• E6. Only enter new business that complement the company‟s strengths.

A more recent work around the characteristics of high performing organizations is provided by Kiron et al. (2011). Please read the Analytics: The Widening Divide for more details.

Sources:

• de Waal, A. (2008): The role of information technology in the high performance organization. Center for Organizational Performance.
• de Waal, A. (2010a): The characteristics of a high performance organisation. Center for Organizational Performance. Hilversum.
• de Waal, A. (2010b): Performance-driven behavior as the key to improved organizational performance. In Measuring Business Excellence 14 (1), pp. 79–95. Available online at http://www.emeraldinsight.com/journals.htm?issn=1368-3047&volume=14&issue=1.
• de Waal, A.; Duong, H.; Ton, V. (2009): High performance in Vietnam. The case of the Vietnamese banking industry. Journal of Transnational Management, Vol. 14, pp. 179–201.
• de Waal, A.; Frijns, M. (2009): Working on high performance in Asia. The case of Nabil Bank. Measuring Business Excellence, Vol. 13, pp. 29–38.
• Kourtit, K.; de Waal, A. (2008): Strategic performance management in practice. Advantages, disadvantages and reasons for use. Maastricht School of Management.

Additional reading:

• Bourne, M.; Kennerley, M.; Franco-Santos, M. (2005): Managing through measures. A study of impact on performance. Journal of Manufacturing Technology Management, Vol. 16, pp. 373–395.
• Franco-Santos, M.; Bourne, M. (2005): An examination of the literature relating to issues affecting how companies manage through measures. Production Planning and Control, Vol. 16, pp. 114–124.
• Guthrie, J. (2001): High-Involvement Work Practices, Turnover, and Productivity: Evidence from New Zealand. The Academy of Management Journal, Vol. 1, pp. 180–190.
• Karhu, J.; Ukko, J.; Rantanen, H. (2006): Performance measurement and employees. Knowledge, understanding and opportunities to participate in decisionmaking. In: Neely, Andrew; Kennerley, Mike; Walters, Angela (Ed.): Performance measurement and management: public and private. Bedfordshire: Cranfield University, pp. 377–384.

 

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2010

05/19

CATEGORY

Theory

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