Organisational effectiveness (OE) and its antecedents in the context of non-profit s
ector
are
not much researched topic
s
while
they are
widely discussed in management literature. Using data from a cross-sectional survey of employees of community welfare organisations in two cities of India, the relationship of variables like organisational climate, organisational commitment, occupational or job commitment and self efficacy on organisational effectiveness (OE) was investigated. Results of one way ANOVA indicated significant variation in the perception of OE by demographic variables. Hierarchical multiple regression analysis was carried out to check relationship of variables on OE. Significant background variables: religion, urban/rural residence in childhood and tenure were entered into the hierarchical regression first. Self-efficacy and occupational commitment were entered next, since they are more personal in nature. Organisational commitment and organisational climate were entered in the last step
.
The findings highlight impact of organisational climate and commitment on organisational effectiveness. Occupational commitment which did not emerge significant in step 2 became a significant predictor of OE, after the inclusion of climate and organisational commitment. This indicates that, commitment to the occupation alone is not sufficient for organisational commitment. Organisational climate will over and above affect commitment to organisation. However, organisational commitment had a direct effect on OE and organisational climate. Implications are discussed.
A non-profit organisation is an organisation whose goal is something other than earning a profit for its owners. Usually its goal is to provide services. Definition as well as categorisation of non-profit organisation had been source of many debates and still had grey areas. Given these confusions, many authors chose to use the term Human Service Organisation to refer to organisations engaged in social welfare. The non-profit organisations involved in social services are referred to as Human Service Organisation (HSO) in this paper.
“When the term HSO is used, it refers to a non-market form of organisation that operates with an indeterminate or ambiguous technology, and mainly is concerned with changing, constraining, and/or supporting human behaviour” ( [1] ; p. 47).
Despite all the work that the HSOs are involved in and their recognition of the need for good management, little which is so far available has been specifically designed for them. Mostly they are borrowed from other social sciences [2]. A great gap exists between what is practised by HSOs, their needs, and theory developed to, cater to these needs [3] [4]. This paper tries to partially answer this need by looking at Organisational Effectiveness (OE) of HSOs. Given the qualitative nature of work, the borrowing of organisational effectiveness from for-profit organisation is not readily applicable in HSOs. The output of for-profit organisations is measurable in terms of profit for the organisation. In the absence of this indicator, HSOs need their own theory on effectiveness and also show how to measure effectiveness of their work. The research work mentioned in this paper was carried out specifically for theoretical contribution to the field.
The structure of the paper is as follows: Section 2 provides a review of select literature wherein the different covariates affecting effectiveness are identified. Section 3 describes the methodology and tools of data collection. In Section 4 the results are explained. Section 5 presents the discussion, policy implications and how effectiveness of HSOs needs to be studied.
2. Review of Literature
Although much of the work on organisational effectiveness focuses on for-profit organisation, there has been spurt in interest for studying effectiveness of HSOs in recent years. Despite organisational effectiveness (OE) remaining a subject matter of interest to researchers, literature in this area shows the scattered nature of the conclusions and findings. A look at the organisation theory shows that the various models of OE are a fall out from the various paradigms in organisational theory: the systems [5] , contingency [6] , strategic choice [7] and synergy [8] paradigms. The multiple constituency (MC) model has been proposed as a viable alternative in the 1990s. MC model tried to incorporate the goal and system models while solving its ambiguities: ecology model [9] , relativistic approach [10] , developmental approach [11] , power approach [12] , social justice approach [13]. Researachers have tried to relate institutional theory to the study of OE in the context of non-profit organisations. He is of the opinion that for organisations like schools, hospitals or other service oriented organisations, whose production is difficult to evaluate, it is imperative to consider their impact on the community [14].
Different authors have classified the factors affecting OE differently [15]. Again here, since these studies were done in for-profit organisations, drawing a parallel for HSOs is difficult. The goals of HSOs are complex and intangible. Hence their output is also equally complex and its measurement requires tedious planning and use of various measurement tools. So it is evident that many more factors than operating in a for-profit organisation need to be considered for HSOs. Various studies have shown the relationship of factors like organisational climate and commitment on productivity, job satisfaction and work satisfaction [16] [17] [18]. However, productivity is difficult to measure in the case of HSOs whose work is primarily qualitative. The importance of decentralised decision making in HSOs is stressed [17]. Studies showed that climate which was bureaucratic inhibits the normal development of personality but a favourable climate where individual needs were satisfied, led to better performance and satisfaction [19] [20]. Staff who felt that they were under tremendous pressure from work, reported sick were unhappy with their supervisors [21].
Based on review of literature, various co-variates that have major impact on effectiveness were identified. HSOs refer to lack of commitment or motivation of the staff as the cause of turnover in the organisation as well as problems faced in getting the work of beneficiaries satisfactorily completed. Researchers have used concepts like organisational commitment, intention to stay, turnover and burnout to study and understand commitment [22] [23] [24]. Individuals can feel committed to the organisation, top management, supervisors, or work group. Besides, there is commitment to careers [25] , unions [26] , professions [27] [28] , goals [29] etc. Commitment can have a variety of meanings, but most frequently refers to the individual’s identification with and involvement in the organisation. Studies examining commitment to occupations have used terms like career, profession and job interchangeably [29]. It is possible to feel strong attachment to an organization and less to the overall profession, while the reverse is also possible [30] [31] [32]. Several studies showed salaries to be a major predictor of occupational commitment [33] [34] [35]. A study found that line employees showed more occupational commitment than staff personnel. Organisational commitment was not related to staff/line distinction [16].
Research on self-efficacy and locus of control tries to stress the different paths that will be taken by intrinsically and extrinsically motivated staff. Bandura first introduced the construct of self-efficacy and situated it within a social cognitive theory and later within a theory of personal and collective agency [36] [37] [38]. Self-efficacy is different from self-concept in that self-efficacy is context-specific assessment of competence to perform a specific task or range of tasks while self-concept is a cognitive appraisal that individuals attribute to themselves. Self-efficacy is used as a mediating variable in many studies [4] [39]. Those who are high in self efficacy are found to be better in performance [40]. A study of organisational commitment found significant relationship with company satisfaction and intrinsic motivation of employees [41]. So a mix of individual specific and organisation specific variables were included as antecedents of OE. Since studies on OE and associated antecedents are lacking in the context of HSOs, the selection is based on studies in for-profit organisations.
3. Methods
In this study, it is hypothesised that organisational climate, organisational commitment, occupational commitment and self-efficacy together can predict OE. The unit of analysis was the staff and not the organisation. In addition the influences of certain demographic variables on OE were also analysed.
3.1. Study Area
The sample for this study was staff of HSOs engaged in community work. HSOs which work around the needs of the community, like a slum, a village or such units formed the universe of the study. The study was done at one city each in the south and west of India (Trivandrum and Mumbai respectively). From a list of HSOs compiled at the two cities, 3 HSOs in grass root work and 3 HSOs in training from Trivandurm and similarly from Mumbai were randomly selected for the study.
3.2. Study Population
Field staff engaged in community work and the office/administrative staff in the selected HSOs were included in the sample of the study. In all HSOs, office staff were few in number and so all of them were included in the sample. Few of the randomly selected HSOs were large enterprises with many community workers. Of the six HSOs studied at Mumbai, two were large HSOs. Around 50% of the field-staff were included in the study while all the office staff were included. At Trivandrum, the response rate was 100% in an HSO of training and an HSO in grass root level work. 93% staff participated in the study from the other two HSOs in grass root level work.
3.3. Study Instruments and Reliability Testing
Standardised, structured, pre-coded questionnaires were used for data collection. All the measuring instruments were tested by collecting data from an HSO in grass root work and an HSO in training that was not included in the study. All the scales followed a five point scale, with scores ranging from 1 to 5. The responses varied from “to a very little extent” to “to a very great extent” or “very low” to “very high”. “To a very little extent” was given the lowest score and “to a very great extent” was given the highest score. Similarly “very low” was given a score of “1” and “very high” was given a score of “5”.
The questionnaires were filled by face to face interviews carried out by the researcher. Informed consent was obtained from respondents prior to filling the questionnaires wherein the aims and objectives of the study were explained, confidentiality ensured and no names or identifying information were entered in the questionnaires.
3.4. Organisational Effectiveness (OE)
The work of HSOs cannot be compared to production organisations. Hence it was necessary to develop a separate questionnaire to measure the organisational effectiveness of HSOs. For this purpose a pilot study was conducted at Trivandrum and Mumbai, based on which scale was prepared for OE (see Appendix A for the scale). After the pilot study the psychometric properties of the measuring instruments were assessed for their applicability in the Indian context. The measure of OE is the total score of 15 items. It had eight sub-measures/factors—adaptability, flexibility, quantity of work, quality of work, reputation of the HSO, service outcome, beneficiary involvement and interaction with other HSOs [42] (see Appendix B for the definitions). Cronbach’s alpha of OE scale was 0.82. Since two of the measures of OE—adaptability and flexibility were adapted from the scale developed by Mott [42] , the reliability of these two measures were calculated separately. Alpha of four items of adaptability and one item of flexibility was 0.66, an acceptable value. For the entire questionnaire, between measures variation was highly significant. Inter item correlation of item to total OE score was high, indicating item validity. The lowest possible score is 15 and highest possible score is 75. The lowest score obtained in this study was 36 and the highest was 75.
3.5. Organisational Climate (OC)
The measure of OC was based on the total score of twenty-two item scale developed by Rao and Chattopadhyay [43]. The alpha coefficient for the composite organisational climate measure was 0.88. The items required respondents to describe conditions and procedures in their organisations. A high score indicated more favourable conditions and procedures or a better organisational climate. The lowest possible score of a respondent is 22 and the highest is 110. The lowest score obtained in this study was 51 and the highest score was 102.
3.6. Organisational Commitment (OCO)
The measure of organisational commitment was also based on the total score of three commitment indices comprising of twenty-four items developed by Meyer and Allen [44]. The indices were affective, continuance, and normative commitment. Cronbach’s alpha of organisational commitment scale was 0.73. A high score indicated high level of organisational commitment. The lowest possible score is 24 and the highest is 120. The lowest score obtained in this study was 55 and the highest was 120.
3.7. Occupational Commitment (JCO)
The scale developed by Meyer, Allen and Smith to measure occupational commitment was used for measuring occupational commitment [45]. The scale comprised of three indices-affective, continuance and normative commitment. Only the items measuring the affective component of occupational commitment were used in this study. A high score indicated high occupational commitment. Cronbach’s alpha of occupational commitment scale was 0.79 in this study. The lowest possible score was 6 and highest score was 30. Minimum score of 12 and maximum score of 30 were obtained in this study.
3.8. Self-Efficacy (SE)
The general self-efficacy scale was used to measure self-efficacy [46]. It consisted of seventeen items. A high score indicated high self-efficacy. Cronbach’s alpha of SE scale was 0.90. The lowest possible score was 17 and the highest score was 85. Minimum score of 30 and maximum score of 85 were obtained in this study.
4. Results4.1. Demographic Profile of Respondents
The total number of respondents was 439: 215 from Trivandrum and 224 from Mumbai. Majority of the respondents were working with HSOs whose focus of work was grass-root level activities and about 186 were from HSOs whose focus of work was training. There were 128 office staff and 311 field staff/ community workers. Females dominated the workforce in HSOs. About 42% staff were in the age group 21-30 years and with almost equal division among the other age categories. Majority had completed undergraduate studies or higher. However, about one third had only secondary education or lower. Most of them had done their schooling in vernacular medium. This was good as their work required proficiency in local language to carry out the community work (Table 1).
4.2. One Way ANOVA Results
One way ANOVA was done to understand the effect of demographic variables—age, place the staff spent their childhood, religion, medium of instruction at school, total years spent in the present organisation (tenure), and total years of work experience on OE. The results are presented in Table 2. Since education is the only variable with three levels, it is not included in the table. The details of education are discussed in the text. The three levels of education were undergraduates, graduates and post-graduates.
Demographic profile of respondents
Variables
Frequency (n = 439)
Percentage
Location of respondent
Trivandrum
215
49.0
Mumbai
224
51.0
Focus of work
Training
186
42.4
Grass-root work
253
57.6
Designation of respondent
Office staff
128
29.2
Field staff
311
70.8
Age
<21 years
79
18.0
21 - 30 years
182
41.5
31 - 40 years
87
19.8
>40 years
90
20.5
Gender
Male
118
26.8
Female
321
73.2
Education
Secondary or lower
146
33.3
Graduation
162
36.9
Post-Graduation
131
29.8
Living till 18 years
Urban
149
33.9
Semi-Urban
159
36.2
Rural
131
29.8
Medium at school
Vernacular
328
74.7
English
111
25.3
Religion
Hindu
148
33.7
Christian
275
62.6
Others
16
3.7
From Table 2 it is visible that the main effects of education, tenure, region where staff spent their childhood and religion were significant, while the main effects of age, medium of instruction at school, and total years of work experience were not significant. Education also emerged significant. Those who spent their childhood in urban area and did their schooling in English medium had given higher rating of OE than their counterparts. Hindus had rated OE higher than Christians. Moreover those who did not change their profession had better
One way ANOVA of demographic variables on OE
Demographic
Levels of Variable
df
F
Variable
(Mean)
1
2
Age (young/old)
70.0778
70.1
1/438
0.034
Living till 18 years (urban/rural 0)
66.02
72.2872
1/438
45.3505***
Medium at school (vernacular/English)
69.7236
71.3077
1/438
2.2932
Religion (Hindu/Christian)
74.5704
68.0391
1/438
47.1396***
Tenure (<5/>5 years)
69.2171
72.8571
1/438
12.0319**
Experience (<5/>5 years)
70.2479
70.0249
1/438
0.0574
Profession Status (changed/not changed)
68.1368
70.8758
1/438
6.9283**
Gender (male/female)
70.5512
69.3677
1/438
1.4889
n = 439, *p £ 0.05, **p £ 0.01, ***p £ 0.001.
perception of OE. Under-graduates had given the highest rating for OE. Results indicate the need for controlling the effects of demographic variables. To understand the relationship of covariates on OE, multiple regression analysis was carried out.
4.3. Hierarchical Multiple Regression Results
Although there is similarity in programs chosen and output produced for hierarchical and step wise regression, there are fundamental differences in the way that variables enter the prediction equation and in the interpretations that can be made from the results. In hierarchical regression the researcher controls entry of variables, while in stepwise the sample data controls order of entry. In hierarchical regression, the order of entry is based on logical or theoretical considerations [47]. Hence hierarchical regression was carried out to understand the relationship of various variables and OE.
To rule out multicollinearity, bivariate correlation was done. The results are presented in Table 3. Significant correlation was observed between the variables. However, all the correlation coefficients are below 0.8.
Results of one way ANOVA indicated significant variations in the perception of OE by demographic variables. Hence these variables: religion, urban/rural residence in childhood and tenure were entered into the hierarchical regression first. Entering these variables first will hold constant any influence these variables would have on OE. Self-efficacy and occupational commitment were entered next, since they are more personal in nature, though environmental factors can influence them. Organisational commitment and organisational climate were entered in the last step. Change in R2, a measure of effect size was estimated
at each step to indicate whether the set of variables entered at that step contributed to the prediction of OE scores over and above previous steps. Standardised β which indicate the relative importance of the predictor variables are also shown in Table 4.
Table 4 shows that entry of occupational commitment and self-efficacy made a significant incremental contribution to the regression equation, accounting for an additional 5% of the variance in OE. Though occupational commitment was not correlated to OE, self-efficacy was highly correlated to OE. Inspection of beta weights in the final regression equation shows that climate made a significant independent contribution to the regression equation. Before entering climate and organisational commitment into the equation, self-efficacy had a high beta weight, but its importance was reduced very much on inclusion of OC and OCO into the equation, indicative of the possibility of lowering the self-efficacy under the influence of climate that is not conducive to the individual. Occupational commitment which did not emerge significant as can be seen in step 2 became a significant predictor of OE, after the inclusion of climate and organisational commitment, suggesting that commitment to the occupation alone cannot prevent turnover. If the climate and commitment to the organisation gets shaky, it can result in high turnover. Self-efficacy and occupational commitment made a significant incremental contribution to the regression equation, as expected, accounting for an additional 14% of the variance of OE. There is a clear association between organisational variables and OE.
5. Discussion
The findings highlight impact of organisational climate and commitment on organisational effectiveness. Studies have found that in HSOs, the decision making process is centralized in the hands of the leaders and the board of trustees leading to dissatisfaction amongst the lower level staff [3] [4] [17] [18] [20]. While implementation of the project depends on field staff, they have no say in how things should be done. Moreover, they get low incentives [33] [34]. Another area of frustration was the limited promotional avenues for staff. Work-related variables
Summary of hierarchical regression on OE as dependent variable
to which employees attribute greater employer responsibility affect organisational commitment [48].
Climate is an important predictor of OE. HSOs need to focus on setting clear goals, evaluation and feedback, and involvement of the staff in the decision making process [40] [49]. The negative sign in the case of occupational commitment and organisational commitment indicates that as OE increased commitment decreased. This implies that focusing on tasks tends to lower the commitment of the staff. Hence there is a need to take the feelings of staff seriously. Incentives need not be their salary alone; appreciation, taking their mental health seriously or giving them credit are also ways to sustain commitment along with OE [3] [50]. The analysis of open-ended questions revealed that field staff were expecting the director to solve the problems related to beneficiary involvement. Another aspect to consider was that with many field staff being undergraduates, their occupational commitment was dependent on the job they held. Thus their occupational commitment did not evolve out of their educational qualification. It was the occupation which was the starting point of their occupational commitment [51]. This brings to the fore the importance of in-service training, staff meetings with proper agenda and discussion that enables field staff to learn how to handle and work through problems they face in the community. Research has shown that organisational commitment of professional and non-professional staff and its correlates vary [23]. In the face of qualitative nature of work of HSOs, expression of commitment values in the form of good work performance takes place only if there are reward and recognition [23] [40].
Members of the community are better equipped to find out solutions for their problems. Many social activists have stressed that the drawback of HSOs is that they cling on to their expert views and ideas without being ready to listen to the people of the community about how they can solve their problems. Community development first and foremost should be what the community wants [15]. Secondly it necessitates the participation of the beneficiaries in planning programmes for them [14]. Sometimes HSOs are so convinced that they are doing the right thing, and are so committed to their cause, that they fail to recognise that what they consider as beneficiary participation does not befit the definition. The implications are paramount. For organisational effectiveness measurement, HSOs need to incorporate various factors for measurement like beneficiary involvement in planning, and staff involvement in decision making about program activities. The association between organisational variables and OE even after the effects of personal variables were partialled out is indicative of the importance of these variables in measurement of OE in the case of HSOs. Organisational climate, Organisational commitment and other variables studied in for-profit organisations can be applied similarly in HSOs. Variables where measurements of productivity are implicated has to be modified as has been done for OE.
Conflicts of Interest
The authors declare no conflicts of interest regarding the publication of this paper.
Cite this paper
Philip, M., Bhargava, S. and Joseph, S.V. (2019) Impact of Organisational Climate, Organisational Commitment, Occupational Commitment and Self-Efficacy on Organisational Effectiveness of Human Service Organisations. Theoretical Economics Letters, 9, 1299-1315. https://doi.org/10.4236/tel.2019.95084
Given below are a list of statements about the performance of your organization. Please read the statements carefully. All questions can be answered by marking one of the alternative. If you do not find the exact answer, mark the one that comes close to it. Please answer all questions
1) Thinking now of the various work being done by the people in this organization, how would you rate the amount of work done?
2) How prepared are the people in this organization in anticipating problems, preventing them from occurring or minimizing their effects? They do
3. How good a job do the people in this organization do at updating themselves with changes and incorporating the same in their work? They do
4) How quickly do most people in this organization accept and adjust to these changes (for e.g., transfer, change of work)?
5) What proportion of the people in this organization accept and adjust to changes quickly?
6) How good a job do the people in this organization do at coping with emergencies such as absenteeism, or unexpected work overloads? They do
7) I can take pride in the quality of work done in this organization.
8) This organization has a favourable reputation in the community.
9) The various programmes of this organization have brought about economic improvement in the life of the people.
10) The various programmes of this organization have brought about change of attitudes in the people.
11) The various programmes of this organization have brought about awareness about various areas such as exploitation, Govt. schemes etc. in the life of the people.
12) The various programmes of this organization have brought about improvement in health of the people.
13) The various programmes of this organization have brought about improvement in literacy of the people.
14) The clients are responsive in attending meetings scheduled for them.
15) To what extent is there interaction (meetings, discussions about common issues etc.) with other HSOs working in a similar area?
Appendix B: Sub-Measures of OE
The following are the sub-measures of OE that emerged in the scale developed to measure OE of HSOs.
The sub-measures of OE were operationalised as follows:
1) Adaptability is the ability of the staff of the HSO in anticipating problems and solving them satisfactorily, staying abreast of methods applicable to the activities of the HSO, and behavioural adaptation like prompt acceptance of solutions and prevalent acceptance of solutions.
2) Flexibility is the ability of the staff to cope with temporally unpredictable overloads of work.
3) Quantity of work is the amount of work being done by the staff of the HSO.
4) Quality of work is the extent to which the quality of work of the HSO is considered good.
5) Reputation of the HSO is the image of the HSO in the community where HSO lends its services.
6) Service outcome is the extent to which HSO has succeeded in obtaining expected outcome or result from the services rendered.
7) Beneficiary involvement is the extent to which beneficiaries attended meetings scheduled for them.
8) Interaction with other HSOs is the extent to which the HSO and other HSOs working in a similar area have common meetings, discussions, united effort to fight for human rights and the like.
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