Organizational Effectiveness in Construction Companies: A Conceptual Framework

Organizational effectiveness is a difficult concept to define and measure especially in the construction industry due to its project-based nature. The different schools of thoughts and corresponding models proposed in the literature approach organizational effectiveness from different starting points and do not cover all perspectives valid for the construction industry. Within the context of this paper, an attempt has been made to explore the current state of knowledge on organizational effectiveness and applicability of proposed models, mainly based on goals, systems, competing values and contradiction schools, in the construction industry. A conceptual framework has been defined to measure organizational effectiveness from multiple perspectives based on the idea that organizations that utilise the right strategies, structure, management style, culture and resources most appropriate for the organization to be able to reach their long term objectives according to the influencing groups within the business environment and environmental forces are effective organizations. There are three parts of the model: organization and its subsystems (strategies, structure, culture and resources), business environment (other parties such as subcontractors, partners etc.) and macro environment (political and economic forces stemming from the country factors). How organizational factors are utilised during the construction process, relations with the influencing groups support construction value chain and a company adapts to changes in the macro environment have been questioned to measure the level of effectiveness. A questionnaire has been designed to collect data on means and ends of organizational effectiveness as defined within the conceptual framework. The validity of the parameters has been examined statistically by empirical data obtained from the survey answered by 116 Turkish contractors. Major determinants of organizational effectiveness are found to be the ability to benefit from market opportunities, experience of the company, level of partnering, culture, organizational learning ability, technical capability, financial resources and flexibilit