Academic research has produced a number of approaches to organizational effectiveness. The first and most widely used defines effectiveness in terms of how well an organization accomplishes its goals. A second approach corresponds to the system perspective it focuses on the internal processes and operations of the organization, or the integrity of the system; effective organizations are those whose internal functioning is smooth and without strain. Other approaches focus on other aspects of organizations. Most of these approaches are fairly abstract and can therefore embrace a wide range of possible evaluations. For instance, while both U.S and Japanese companies emphasize profitability as a measure of effectiveness, U.S firms have traditionally stressed short term profitability and Japanese businesses long term profits. This contrast suggests that the approach taken to measuring effectiveness must be defined clearly in order to achieve an accurate assessment.
Another way of dealing with the abstractness of these concepts is to reify organizations or treat them as thought they are concrete entities. We do this by focusing on activity that we call â€˜organizational behaviorâ€™. Managers, in particular, need to keep in mind that people in organizations behave, not organizations themselves. Only when we focus on what people in organizations do can we gain any understanding of the effectiveness of the whole. People can behave in vastly different ways, although they may seemingly be pursuing the same goals. Consequently, it is necessary to look at what people do and say and combine their activities and interactions in some way that reflects organizational effectiveness, managers should keep in mind that effectiveness studies rarely turn up clean relationship, as one would wish. That is, one hopes that employee commitment would be clearly related to effectiveness, but studies relating the two variables have revealed no such connection.