QS Study

Factors contributing to the development organizational performance: Organizational performance means the actual output or results of an organization measured against its intended outputs. Organizations vary according to the relative influence of a number of factors related to both the objective of the organization and the instruments and strategies chosen to achieve them. The analysis focuses on three main outcomes, first, shareholder value performance; second, financial performance; and third, market performance. Factors which contribute to the development of organizational performance is written below:

(1) External factors: Those from the enabling environments which are not under the control of the organization but which affect its structure and development. They include –

  • Economic factors
  • Socioeconomic factors
  • Political administrative factors

(2) Internal factors: Internal factors also contribute to the development of organizational performance. Internal factors include –

  • Purpose of the organization
  • Organizational instruments.

(3) Individual choice factors: Member joint or individual decisions regarding expected costs, and benefits.

Other studies, especially in the 1970’s, focused on the influence of internal factors, while more recent work has emphasized the importance of all three set of factors. These three factors help to develop organizational performance.