Performance

Date: 2015-10-07; view: 419.

What constitutes high performance in an organization? Performance actually is made up of two important dimensions: effectiveness and efficiency.

Effectiveness. Effectiveness is the ability to choose appropriate goals and achieve them. Effectiveness, then, has two parts. First, goals must be appropriate. Second, goals must be reached. For example, Nordstrom, Inc., a Seattle-based apparel, shoe, and soft-goods retailer, is carving out an admirable niche for itself by providing legendary good customer service at its 55 department stores (mainly on the West Coast). Sales associates (many of whom are college graduates) gift-wrap packages for no extra cost and have even been known to drop them off at customers' homes in a pinch. Piano players serenade customers while they shop. According to one story, which the store has not denied, a customer got his money back on a tire. Given that the company does not sell tires, the story illustrates the store's dedication to a return policy based on "no questions asked". Bill Baer, a men's clothing salesman in the Palo Alto store, says, "Nordstrom tells me to do whatever I need to do to make you happy. Period." This stance has enabled the upscale chain to expand into new areas of the country such as Washington, D.C., and New Jersey. Nordstrom illustrates that effectiveness is essentially doing (accomplishing) the right things.

Efficiency. In contrast, efficiency is the ability to make the best use of available resources in the process of achieving goals. In the case of Nordstrom, the store enjoys the highest sales per

In essence, organizations need to exhibit both effectiveness (doing the right things) and efficiency (doing things right) in order to be good performers.