No organization thinks, “It really doesn’t matter if we succeed.” Everyone wants to believe they’ve set a clear plan for organizational success. Yet some plans succeed, and many fail or fall short. What makes one organization more successful than others?
And how can you make your company more successful?
We’re going to share the secrets of high-functioning teams. First, we’ll define what organizational success actually means. Next, we’ll examine the key factors that influence organizational success. Then, we’ll turn to how you can transform your business by nurturing those elements.
Table of Contents
1. What Exactly Is Organizational Success
2. Key Components of Organizational Success
3. How to Achieve Organizational Success
4. Metrics for Organizational Success
5. Great Books About Organizational Success
What Exactly Is Organizational Success
Organizational success means effectively reaching goals that achieve the company’s mission. This typically means fulfilling a plan laid out by leadership. However, seizing unexpected opportunities can also lead to success.
Today, some companies are broadening the definition of success. Instead of just results, they’re factoring in wellness. To make their efforts sustainable, they focus on ensuring employee wellbeing.
Key Components of Organizational Success
What factors ultimately lead to success? We identify eight main elements that allow top companies to thrive.
Shared Values
Organizations with shared values have a strong advantage over others, as Inc. notes. People feel a sense of common ground. They may have greater trust and appreciation for one another. After all, they believe in the same principles.
Research shows the top values across Fortune 500 companies:
- Integrity
- Teamwork
- Innovation
- Customer service
- Respect
Never assume values are obvious—articulate and reinforce them.
Leadership Approach
Leadership approach greatly influences success, from the CEO to mid-level supervisors. Great leaders connect people to purpose and build strong relationships. They also innovate, creating new and better ways of doing things.
Focus
A strong vision acts as the backbone of success, steering the group’s direction. Having the vision isn’t enough—every employee needs to understand it. This gives them a strong understanding of their mission.
Strategy
In addition to the vision, top organizations have a clear plan for fulfilling it. Having great strategic minds on board results in an optimal strategy.
Flexibility
Successful companies strive to be agile enough to jump on new opportunities. After all, no one can predict every challenge or possibility that will emerge. Being nimble allows companies to make changes and try new ideas.
Culture
Workplace cultures that prioritize open communication and transparency enhance success. Employees must feel safe to voice ideas. The culture must create psychological safety. This helps everyone feel supported. Plus, employees must trust that leaders are sharing info that concerns them.
Organizations with strong culture report a 60% greater return to shareholders than those with average culture.
Employee Experience
Employees need to have a positive experience at work to keep satisfaction high. This improves culture, and ultimately, enhances success, asserts McKinsey. Employees feel energized to give their best effort.
Developmental Opportunities
Great companies provide training and resources that help employees improve. Each person feels empowered and encouraged to grow. Such opportunities increase morale while instilling valuable skills.
Organizational success is tied to employee commitment and culture, as McKinsey notes. Employee engagement promotes success. In turn, success increases employee engagement. They feel proud to play a role in their organization’s success.
Culture can also improve as a result since morale increases with success. People may appreciate their coworkers more, encouraging supportive group dynamics.
Together, these factors differentiate high-performance organizations from the rest. And ultimately, they enhance organizational success.
How to Achieve Organizational Success
What strategies can you use to implement the key elements of success? We’ll discuss how to enhance management, decision-making, communication, engagement, compensation, and recognition for greater organizational success.
Good Decision-Making
Strong decision-making is vital to organizational success. Leaders must understand all facets of the business to make wise decisions. Let’s explore a few vital decisions leaders must make to achieve success.
Establish core values
Sixty percent of employees have no idea what their organization stands for. Establish a strong set of core values that guides your work. When recruiting, look for people with those principles. Think about the values that drove the creation of the business. Have they evolved since then? You may need to discuss them with the founder or directors.
Holding a focus group with managers or employees could also bring values to light. Or, it may help you narrow down a list to the most crucial ones.
Adopt scalable plans
A scalable plan is usually beneficial. You can start small, then expand it as capacity grows. Founding a business model on scalability can greatly enhance success. Ask yourself, “As we grow from 50 employees to 100, how will we adapt?” For instance, using cloud-based performance management solutions can streamline this process across locations.
Likewise, design products or services that you can produce at scale without sacrificing quality.
Consider new models
Are teams working differently than they were a couple of years ago? Perhaps giving people greater autonomy over decision-making will boost efficiency. In that case, it could be time to adopt a flatter working structure, as McKinsey suggests.
Similarly, have roles been in constant flux? You could make roles project-based rather than permanent. This means specific duties can shift based on current needs. Don’t make such decisions lightly, but do consider the options.
Implement customer-centred design
The top companies intentionally design and improve customer experience. Data-driven learning should continuously enhance the customer journey. Find out if your product effectively addresses a key challenge they’re experiencing. Continuously ask how it can better meet that challenge as conditions change. And strive to make processes more intuitive as technology improves.
Performance Management
Great performance management will also foster organizational success. First, it will help each employee achieve peak performance. Second, it will guide them to build the skills to contribute even more. Here are some key ways of upgrading your performance management.
Set and achieve goals
Effectively setting goals greatly benefits organizational success. Each employee and team should have clear goals aligned with the mission. Goal-tracking software will help employees and managers monitor their progress. If they get off track, it will let them know. And they’ll have a big morale boost when they see they’re coming closer to achieving them.
Enhance communication
Promote strong communication between managers and employees and between coworkers. Here are a few ways of boosting communication to enhance organizational success:
- Use instant feedback tools to foster clear communication. Employees can easily share advice and feedback—both constructive and positive—with each other. And, of course, so can managers.
- Hold regular team meetings to keep team members up to date. That’s especially important for hybrid and remote teams.
- Create an organizational map of functions. Write up a short blurb for each person, showing their areas of focus. Then, employees will know where to turn with specific questions.
- Design a clear visual showing workflow processes. Adapt it to specific projects, adding roles and target dates, and share it with team members. Then, people will know who to discuss any issues with—and by when.
With clear, consistent communication, people will resolve problems without delay. They’ll also gain timely guidance on how to improve.
Nurture wellbeing
Prioritize employee wellbeing by lowering stress and making workloads manageable. Managers should sit down with each employee to assess their task load. Make sure staff have all the necessary resources to do their jobs efficiently, too. This will avoid wasted time and much frustration.
Build in variety
Increase flexibility by regularly giving employees new types of challenges. If they always focus on a narrow range of tasks, they won’t be prepared to adapt. Try switching job duties or giving everyone the chance to lead a project.
Recognize efforts
Show appreciation for even the small improvements and wins. These will be stepping stones to bigger ones if you share encouragement. As you show gratitude, you’ll encourage a culture of appreciation.
Fair Compensation and Benefits
Offering fair compensation and benefits will encourage valuable employees to stay. Look at what competitors are offering in your field. If staff are based in one geographic area, consider typical salaries there. Otherwise, consider whether you can offer salaries that meet the needs of employees across regions.
Many remote workers now expect salaries to reflect their location. After all, some have higher costs of living than others. In fact, 67% of employees expect pay to vary by location. Sixty-two percent of organizations have implemented geographic pay. And 44% of those orgs are considering pay changes based on the increase in remote work, SHRM reports.
If you go this route, create geographically based pay structures. Don’t just “wing it” with each new employee. Having established norms based on equity will help ensure fair compensation. For example, many Silicon Valley firms make a 6% downward adjustment when employees move to less costly areas, SHRM notes. The exact figures may vary by region.
As you enhance your company in these ways, you’ll expand organizational success. Because employees will thrive, they’ll remain loyal, satisfied, and committed. And operations will go smoothly with a clear, purpose-driven plan.
Metrics for Organizational Success
How will you know if you’re succeeding? These metrics for organizational success will help you evaluate your progress.
- Leads (and customers) generated. Look at how many new people are using your product or service. Determine what percentage of leads become customers.
- Return on investment (ROI). This refers to how much profit you’ve made from investing in a product or service. With a business, the time and resources you’ve put in are your investment. Calculate it in this way, Harvard Business School advises:
ROI = (Net Profit / Cost of Investment) x 100
This will show how much profit you’ve actually made.
- Conversion rate and customer satisfaction score. Calculate your conversion rate by determining how many visitors become customers. Divide those who purchased or subscribed to your mailing list by total visits. Then multiply by 100.
- Employee satisfaction and engagement. Assess this metric with opinion surveys and analytics. Use performance tracking software to pinpoint changes in engagement. Then, you can adapt to them in real-time.
- Employee productivity. Goal-tracking software will show key results and progress. You can measure entire teams’ productivity as well as individuals’. Plus, you can measure ROI of performance management initiatives or training using analytics.
These key performance indicators (KPIs) for organizations will help you benchmark success. They include both outcomes (e.g., new customers) and inputs (employee commitment) that further those outcomes.
Great Books About Organizational Success
We’d like to share some of our favourite books about organizational success:
- The Success Formula: How Smart Leaders Deliver Outstanding Value by Andrew Kakabadse (2015). You’ll learn how to become a value-driven organization that outshines competitors.
- Elevate: Push Beyond Your Limits and Unlock Success in Yourself and Others by Robert Glazer (2019). Learn how to bring out your own best qualities and those of your team.
- Multipliers: How the Best Leaders Make Everyone Smarter by Liz Wiseman (2017). Wiseman delves into how to embrace continuous change by unlocking each employee’s genius.
- Brave New Work: Are You Ready to Reinvent Your Organization? by Aaron Dignan (2019). Get inspired by how bold changes have led organizations to thrive.
- The Culture Code—the Secrets of Highly Successful Groups by Daniel Coyle (2018). Learn what elements of culture make the world’s best organizations so successful.
- The Making of a Manager: What to Do When Everyone Looks to You by Julie Zhuo (2019). Zhuo discusses hard-won lessons on how to lead a successful team.
- Competing in the New World of Work: How Radical Adaptability Separates the Best from the Rest by Keith Ferrazzi, Kian Gohar, and Noel Weyrich (2022). They share guidance on envisioning the future and embracing new realities.
These timely books provide invaluable insights on how to implement crucial elements of success.
Through these success strategies, you won’t just achieve organizational success in terms of results. You’ll also have a deeply engaged and committed team. And that’s an enormous success in its own right!
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