Abstract:

“Managerial effectiveness and organizational performance are two major themes in

organizations. The purpose of this study is thus to investigate whether there is an association
between organizational performance and managerial performance and if so, to determine the
route of this relationship. Data were collected through self-administered questionnaire from 30
employees working as manager in private government sector banks from Islamabad/Rawalpindi
area of Pakistan. Results from the survey showed that there is a significant positive relationship
between organizational performance and managerial Effectiveness & Efficiency. The important
limitations of the study are the sample used, which is mainly from different sectors and from
Rawalpindi/Islamabad area. This study contributes to the knowledge on organizational
performance and managerial effectiveness & efficiency an area of research that is almost
unexplored in Pakistan. Secondly this study aims to test the relationship which has never been
explored before.”

Introduction:
Impact of managerial effectiveness & efficiency on organizational performance:

We have conducted this research in order to find out all the factors affecting the managerial
effectiveness & efficiency and its impact on organizational performance and how it can be
improved in Rawalpindi Islamabad. In our study we will also study the factor that makes the
managers to leave their post and switch to other organization.

Variables:

Dependent variable:

Dependent variable is the variable that can take different values only in response to independent
variables. In my topic the dependent variable is the organizational performance. It means that the
organizational performance will be increase or decrease if we change the value of the
independent variable.

Independent variable:

Independent variable is the variable that can take different values and can cause corresponding
changes in the other variable. In my topic of research the independent variable is the managerial
effectiveness and efficiency. Its value is independent. It does not depend on the other variable.
However it will cause a change in the dependent variable that is the organizational performance.
By the term efficiency we mean that whether the manager has the ability to complete the work
within the specific period of time and effectiveness means whether the manager has the ability to

1
obtain maximum output from the minimum resources. What are the factors that affect that ability
of the manager?

1. 1. Problem Statement:-

“Impact of the managerial effectiveness and efficiency on the

organizational performance”

Background of the problem:-

Leadership is commonly seen as an important variable affecting organizational performance.

While the concept has been extensively studied, there is still much to be discovered regarding
how leadership affects variables such as organizational culture, climate, and performance. Most
of the research on leadership has been in for-profit organizations. While research on leadership
in human services organizations is increasing, there is still a limited amount of research
knowledge to guide practice in our field. One seminal article in social work described the
importance of administrative “behaviors, attitudes, practices, and strategies” in ensuring effective
service outcomes (Patti, 1987, p. 377), and subsequent research, some of which is included
below, supports this perspective. Organizational change

Leadership and, specifically, organizational cultural change will receive special attention because
of their key roles in impacting and improving organizational performance. Leadership, and the
study of this phenomenon, has roots in the beginning of civilization. Our work, work
environment, worker motivations, leaders, managers, leadership style, and a myriad of other
work-related variables have been studied for almost two centuries. Over time, organizations have
evolved from those with an authoritarian style to ones with a more comfortable work
environment, and then to organizations where people are empowered, encouraged, and supported
in their personal and professional growth. This paper examines how leader focus has changed
over time, the nuances of leader focus as captured in the progression of leadership theory.
Leadership, and the study of it, has roots in the beginning of civilization. Egyptian rulers, Greek
heroes, and biblical patriarchs all have one thing in common–leadership. There are numerous
definitions and theories of leadership; however, there are enough similarities in the definitions to
conclude that leadership is an effort of influence and the power to induce compliance (Wren,
1995). Our work, work environment, the motivation to work, leaders, leadership, leadership
style, and a myriad of other work-related variables have been studied for almost two centuries
The Industrial Revolution shifted America’s economy from an agriculture base to an industrial
one and, thereby, ushered in a change in how leaders would treat their followers. The Industrial
Revolution created a paradigm shift to a new theory of leadership in which “common” people
gained power by virtue of their skills (Clawson, 1999). New technology, however, was
accompanied and reinforced by mechanization of human thought and action, thus creating
hierarchical bureaucracies (Morgan, 1997).

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Managing people effectively in extension programs is a skill that requires constant planning and
development. An extension programme manager can be defined as the person who is vested with
formal authority over an organization or one of its sub units. He or she has status that leads to
various interpersonal relations, and from this comes access to information. Information, in turn,
enables the manager to devise strategies, make decisions, and implement action (Mintzberg,
1988). Management is concerned with the optimum attainment of organizational goals and
objectives with and through other people. Extension management organizations are characterized
by many strategies, wide spans of control, democracy, and autonomy. Their management
practices cannot be reduced to one standard set of operating guidelines that will work for all
organizations continually. However, all managers of professional organizations face the same
challenge: to manage one's time, objectives, and resources in order to accomplish tasks and
implement ideas (Waldron, 1994).

The past decade of organizational research has moved from an investigation of organizational
statics to an investigation of organizational dynamics, much of it focused on organizational
change and its antecedents (Fligstein, 1991; Hannan & Freeman, 1989). Strategy and
organizational researchers seem to vary in the extent to which they adopt an adaptive or inertial
view of strategic change; although the two perspectives can he viewed as poles on a continuum
(Gersick, 1994). Those who argue for the predominance of strategic adaptation emphasize the
role that managers play in monitoring environmental changes and modifying organizational
strategy to better match environmental contingencies (Child. 1972). Theorists adopting a more
inertial view of strategy argue that organizations are constrained in their ability to adapt, and that
it is the general tendency for strategy to be preserved rather than radically changed (Hannan &
Freeman, 1989). Political resistance and vested interests within an organization can also
encourage inertia and make change difficult (Tushman & Romanelli, 1985). A researcher have
argued that executive change, in particular, changes in a company’s chief executive and top
management team, is an important

mechanism for overcoming inertia and political resistance (OcasJo, 1993). As Tushman and
Romanelli noted, "Only executive leadership has the position and potential to initiate and
implement strategic change" (1985: 209). As top management structures remain stable, they
become more insulated over time, and chief executives and top managers are less likely than they
may have been to deviate from earlier courses of action, especially when change involves
organizational strategy (Goodstein & Boeker, 1991).

1.2. Research Objective:-

The objective of our research is to check that what the factors,

are affecting the managerial effectiveness and efficiency and its impact on the organizational
performance in Rawalpindi Islamabad, why managers are switching from one organization to
another organization?

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.1.3. Importance/Benefits:-

This research is very beneficial for

 The students
 Top management
 Policy maker
 HR department
 Future entrepreneurs
 The Government

1.4. Research Design:-

1. 4.1. Elements of research design:-

I. Type of investigation:-
The study which we conduct is co-relational study which tells the
relationship between dependent and independent variables. It is also non-contrived.

II. Data collection method:-

The process of this research is started from observation and
then we have conducted unstructured interviews by asking different questions. After the
unstructured interviews we have made a questionnaire to know the point of view of different
suppliers of milk in Islamabad and Rawalpindi.

III. Purpose of study:-

Our research is basically depends on exploratory study. Here we
explain the difference between dependent and independent variables then made hypothesis.

IV. Time horizon:-

In this research data is collected in days.

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 LITERATURET REVIEW
In our research we have taken the managerial effectiveness & efficiency as an independent
variable and the organizational performance as the dependent variable. In this research we will
also exam the relationship between the managerial effectiveness & efficiency and organizational
performance. Whether they have the positive (direct) and negative (indirect) relation. If they
have positive relation than if we increase the managerial effectiveness and efficiency than its
value should also increase the organizational performance and if they have the negative relation
than by increasing the independent variable the value f dependent variable should decrease.

PAST STUDY:

The past decade of organizational research has moved from an investigation of organizational
statics to an investigation of organizational dynamics, much of it focused on organizational
change and its antecedents (Fligstein, 1991; Hannan & Freeman, 1989) In ad-dition to the
characteristics of chief executives and top management teams, conditions of poor performance
make it easier to overcome resistance to organizational and strategic change (Haveman, 1993;
March & Simon 1958). The performance of an organization is one of the clearest indicators of
the viability of its strategy and an important predictor of whether it will change the markets it
competes in (Zajac & Kraatz, 1993). Poor performance signals top management that the existing
manner of operating is inappropriate and that strategic and organizational changes may be
necessary (Boeker & Goodstein, 1991). Past research has shown that poor performance acts as a
catalyst to organizational change when managers take actions in response to a decline in
performance (Cyert & March, 1963; Kiesler & SprouU, 1982). March and Simon (1958) were
among the first to argue that poor performance will lead organizations into problem-motivated
search, which in turn will lead to pressures for change. Only when poor performance signals that
an existing manner of operating is inappropriate do managers attempt to change an organization
to respond to environmental change (Tushman & RomaneUi, 1985). Managers of organizations
that are performing poorly are in a position to more easily overcome resistance to change and
may be able to use poor organizational performance to legitimate changes that may be politically
difficult otherwise (Finkelstein & Hambrick, 1996),

In a classic example. Chandler (1962) described how strategic changes emerged in response to
poor performance at Standard Oil, DuPont, and General Motors. At an individual level, prospect
theorists (Kahneman & Tversky, 1979) have also argued that, under conditions of adversity,
failure to meet performance targets will lead to increased change and risk seeking (Bromiley,
1991). If poor performance may lead to organizational change, good performance may lead to
inertia. As long as performance is above a threshold level, organizations will have a tendency to
persist in repertoires and routines established earlier (Nelson & Winter 1982). Hannan and
Freeman (1984) argued that organizational success exacerbates inertia, and thus resistance to
organizational changes. Orgcinizational success can also make top managers feel that they can

5
safely ignore external change (Dutton & Duncan, 1987). As Oster noted "As long as
performance is satisfactory, firms will continue to allocate internal resources using whatever
rules of thumb they've used in the past" (1982: 377). Organizations that have recently been
successful will resist changes in their basic strategies and missions. The longer sucb firms have
been successful, the greater the extent to which resistance to change and inertia will prevail
(Boeker & Goodstein, 1991), and the less likely it will be that changes in external conditions will
lead directly and immediately to change (Tushman & RomaneUi, 1985).

In past theoretical and empirical work on strategic change, organizational leaders have been
viewed as the motivating force behind changes in the products or markets an organization
competes in 1997 Boeker. 155 (Ginsberg, 1988; Virany, Tushman, & Romanelli, 1992). Because
its chief Executive plays an important role in helping define the strategy of an organization;
change in the chief executive carries with it the likelihood that changes will be made in the
organization's strategy (Ocasio, 1993). Work by Helmich and Brown (1972) demonstrated an
association between chief executive succession and organizational change, confirming that
greater organizational change accompanied chief executive change. Empirical examinations of
the effects of executive succession on organizational and strategic change bave stressed the
important role played by executive succession in overcoming inertia and initiating changes in the
strategy of an organization (Brady & Helmich, 1984). McGregor (1960) believed that
management needed practices based on a more accurate understanding of human nature and
motivation. The resulting concept, Theory Y, proposed that individuals are not, by nature, lazy
and unreliable. People can be self-directed and creative at work if properly motivated (Pugh &
Hickson, 1993). Therefore, an essential task of management is to unleash this potential.

SUPPORTING THEORRIES

Classical Management Theory and Scientific Management Weber’s concerns about

bureaucracy, however, did not affect theorists who set the stage for what is now known as
“classical management theory” and “scientific management.” Classical theorists focused on the
design of the total organization while scientific managers focused on the systematic management
of individual jobs. In contrast to Weber, classical theorists such as Henri Fayol and F. W.
Mooney, staunch advocates of bureaucratization, devoted their energies to identifying methods
through which this kind of organizational structure could be achieved (Bass, 1990; Morgan,
1997). Collectively, these theorists set the basis for many modern management techniques, such
as management by objectives.

Hawthorne, Maslow, and Herzberg–Environment and Worker Needs Much organizational

research during this era focused on overcoming the perceived shortcomings of the classical and
scientific schools of management. Elton Mayo’s Hawthorne Studies focused on the work
situation and its effect on leaders and followers, indicating that the reactions of human beings
influence their work activities as much as the formal design and structure of the organization.
Early on, leaders could focus their attention on the environmental factors of their organizations.

6
The early theories and studies provided researchers with tangible and measurable performance
outcomes that were directly transferable to profitability and spreadsheet bottom-lines. A new
theory of organizations and leadership began to emerge based on the idea that individuals operate
most effectively when their needs are satisfied. Maslow’s (1959) Hierarchy of Needs posited that
once a worker’s physiological, security, and social (intrinsic) needs were met productivity would
only be possible if the employee’s ego and self-actualizing (extrinsic) needs were also met.
Leader focus became redirected toward worker needs.

Behavioral theory: Behavioral theories of leadership are based upon the belief that great leaders
are made, not born. Consider it the flip-side of the Great Man theories. Rooted in behaviorism,
this leadership theory focuses on the actions of leaders not on mental qualities or internal states.
According to this theory, people can learn to become leaders through teaching and observation.

Management theory: Management theories, also known as transactional theories, focus on the
role of supervision, organization and group performance. These theories base leadership on a
system of rewards and punishments. Managerial theories are often used in business; when
employees are successful, they are rewarded; when they fail, they are reprimanded or punished.
Learn more about theories of transactional leadership.

H1: there is positive relationship between the managerial effectiveness & efficiency and the
organizational performance

Ho: there is negative relationship between the managerial effectiveness & efficiency and the
organizational performance

ARTICLES:
WARREN BOEKER studied and examined how chief executive and top management team
characteristics interact with organizational performance to influence strategic changes. Results
indicate that poor performance, long chief executive and top management team tenures, and high
diversity in top management team tenure are associated with greater levels of strategic change. In
addition, poor performance moderated the relationship between managerial characteristics and
strategic change, increasing the likelihood of the latter.

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YADONG LUO studied by Using survey data from China, we demonstrate that managers' micro
interpersonal ties with top executives at other firms and with government officials help improve
macro organizational performance. This micro-macro link differs among firms with different (1)
ownership types, (2) business sectors, (3) sizes, and (4) industry growth rates. In addition,
managerial ties were found to be necessary but insufficient for good performance; a number of
traditional strategy variables also drive performance. Theoretically, the findings point to the
importance of the social context in which managerial ties are embedded. Empirically, this study
provides the first set of quantitative data demonstrating both the extent and limits to which
managerial ties are beneficial in a transition economy.

BARRY GERHART and GEORGE T. MILKOVICH has studied two general focuses. First,
after reviewing the literature on compensation strategy, we examined the extent to which
organizations facing similar conditions make different managerial compensation decisions
regarding base pay, bonus pay, and eligibility for long-term incentives. Second, working from
expectancy and agency theory perspectives, we explored the consequences of those decisions for
organizational performance. Using longitudinal data on about 14,000 top and middle-level
managers and 200 organizations, we found significant differences between organizations. Our
results suggest that organizations tend to make different decisions about pay contingency, or
variability, rather than about base pay. Findings indicate that contingent pay was associated with
financial performance but base pay was not.

BRIAN S. KLAAS and ANGELO S. DeNISI has studied and explored whether managerial
reactions to grievance activity introduced bias into the process of performance appraisal. Using
panel data techniques and data on unionized employees in a public sector organization, we
examined the relative impacts of grievances filed against supervisors and against organizational
policy. The pattern of results obtained suggests that the relationship between grievance activity
and performance ratings is due at least in part to bias triggered by employees' filing and winning
grievances against supervisors.

ETHAN R. BURRIS has examined whether managerial responses to employees speaking up

depend on the type of voice exhibited—that is, whether employees speak up in challenging or
supportive ways. In one field study and two experimental studies, I found that managers view
employees who engage in more challenging forms of voice as worse performers and endorse
their ideas less than those who engage in supportive forms of voice. Further, perceptions of
loyalty and threat mediated these relationships, but in different ways. I discuss implications for
research on voice, proactively, and social persuasion.

8
 Methodology:
1.4.2. Research Instrument:-
For the purpose of research we have used the following research instruments

 Structured interviews
 Unstructured interviews
 Questioners
 News papers
 Television shows
The sample size of our respondent was 30 mangers in every field whether they are in private sector or in
the government sector. We have selected randomly 15 mangers from Islamabad and 15 managers from
Rawalpindi. From them we have filled the questioner. The questioner compromises of 12 Questions.6
Questions were related to the organizational performance and 6 were related to the managerial
effectiveness and efficiency. We have also visited the PhD’s students and researchers and asked them
unstructured question. From there we have got a lot of independent variables.

1.5. Data Analysis

We have applied the following tests on the data

 Correlation test
 Regression test
 Descriptive
 ANOVA
 Frequency Table
 Bar chart
 Pie chart
 Histogram

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 1. 6. Result & Deliverables

Correlations

managerial
effectiveness and Organizational
efficiency performance

managerial effectiveness and Pearson Correlation 1 .635**

efficiency
Sig. (2-tailed) .000

N 30 30

Organizational performance Pearson Correlation .635** 1

Sig. (2-tailed) .000

N 30 30

**. Correlation is significant at the 0.01 level (2-tailed).

Correlation is the measure of association between two variables. Of the 30 questionnaires distributed, 30
(usable) were returned, a response rate of 100 per cent. The result shows that there is perfectly positive
correlation between managerial effectiveness & efficiency and organizational performance. When one
variable increases the other variable will also increases.

Descriptive Statistics

N Minimum Maximum Mean Std. Deviation

managerial effectiveness and

30 2.67 4.50 3.5778 .51553
efficiency

Organizational performance 30 2.67 4.50 3.7111 .48922

Valid N (list wise) 30

The result about the descriptive study shows in table no.2 the separation of data from the mean with the
rate of 0.51553 between minimum 2.67 to maximum 4.50 related with the job satisfaction. One the other
hand the job performance separation rate is 0.48922 between the minimum 2.67 and maximum 4.50

ANOVAa
Model Sum of Squares Df Mean Square F Sig.

Regression .259 1 .259 4.487 .044b

1 Residual 1.559 27 .058

Total 1.818 28
a. Dependent Variable: X

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b. Predictors: (Constant), Y

Model Summary

Std. Error of the

Model R R Square Adjusted R Square Estimate

1 .635a .404 .382 .38451

a. Predictors: (Constant), managerial effectiveness and efficiency

Coefficientsa

Standardized
Unstandardized Coefficients Coefficients

Model B Std. Error Beta t Sig.

1 (Constant) 1.554 .500 3.106 .004

managerial effectiveness and

.603 .139 .635 4.353 .000
efficiency

a. Dependent Variable: Organizational performance

Frequency
Statistics
X Y

Valid 29 29
N
Missing 0 0
Mean 3.8103 3.7356
Median 3.8333 3.6667
Mode 3.83 3.67
Std. Deviation .25481 .23366
Variance .065 .055
Skewness .506 1.443
Std. Error of Skewness .434 .434
Kurtosis .640 2.826
Std. Error of Kurtosis .845 .845
Range 1.17 1.00

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Frequency Table
X
Frequency Percent Valid Percent Cumulative
Percent

3.33 1 3.4 3.4 3.4

3.50 5 17.2 17.2 20.7

3.67 5 17.2 17.2 37.9

3.83 10 34.5 34.5 72.4

Valid
4.00 4 13.8 13.8 86.2

4.17 3 10.3 10.3 96.6

4.50 1 3.4 3.4 100.0

Total 29 100.0 100.0

Y
Frequency Percent Valid Percent Cumulative
Percent

3.50 8 27.6 27.6 27.6

3.67 10 34.5 34.5 62.1

3.83 6 20.7 20.7 82.8

Valid 4.00 3 10.3 10.3 93.1

4.17 1 3.4 3.4 96.6

4.50 1 3.4 3.4 100.0

Total 29 100.0 100.0

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Bar Chart

13
Pie chart

14
Histogram

15
We are using simple regression line y=β0+β1X

Here β0 represent the intercept meaning that the value of Y when the value of the X=0, here the X
independent variable is managerial effectiveness & efficiciency and dependent variable organizational
performance, The result shows that the value of beta not is equal 1.554 which means if the value of job
satisfaction is zero than the value of job performance is 1.554.

In regression line beta 1 represents slope which mean change in dependent variable due to change in
independent variable. Here independent variable is managerial effectiveness & efficiciency and dependent
variable organizational performance. The result of beta is 1 = 0.603 which means 1 unit change in
independent variable (managerial effectiveness & efficiciency) the dependent variable (organizational
performance) change with the rate of 0.603.

Standard Error: Standard error is a statistical term that measures the accuracy with which a sample
represents a population. In statistics a sample means deviate from the actual mean of a population: this
deviation is the standard error. The smaller the standard error the more representative the sample will be
of the overall population.

Our result shows that standard error is 0.38451 its means that the sample shows the true picture of the
population.

R2 represent the goodness of fit of the model value of our result of R2 = .404 its mean 40% changes in
dependent variable(organizational performance) due to independent variable (managerial effectiveness
and efficiency) and remaining changes due to other factors.

LIMITATION

The problems faced during the conduction research process are given below:

i. The research was done the first time by us and we were not familiar about the research process.
ii. Shortage of time created many problems for us conducting research.
iii. We conducted interviews from some people due to shortage of time.
iv. The persons from whom we received information about the research topic did not cooperate.
v. Due to lack of budget we did not conduct research on a large scale.
vi. The research is limited only to the grocery stores of Islamabad-Rawalpindi.
vii. Low generalizability because of limited area research

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 REFERENCES:

Bantel K, &. J. (1989). Top management and innovations in banking; does the composition of the top
team make a difference? Strategic Management Journal,. Strategic Management Journal,, 10:
107-124.

BOEKER, W. (1997). THE INFLUENCE OF MANAGERIAL CHARACTERISTICS AND ORGANIZATIONAL

GROWTH. Academy af Management Journal,  WARREN BOEKER 1997 STRATEGIC CHANGE:
THE INFLUENCE OF MANAGERIVol. 40. No. 1, 152-170.

BRIAN S, K. A. (1989).  BRIAN MANAGERIAL REACTIONS TO EMPLOYEE DISSENT: THE IMPACT OF

GRIEVANCE ACTIVITY ON PERFORMANCE RATINGS .  BRIAN S. KLAAS ANGELO S. DeNISI 1989
MANAGERIAL REACTIONS TO EMPLOYEE DISSENT: T Academy of Management Journal , Vol. 32,
No. 4. 705-717.

MIKE W PENG, Y. L. ( 2000).  MIKE W. PENG , YADONG LUO , 2000, MANAGERIAL TIES AND FIRM
PERFORMANCE IN A TRANSITION ECONOMY: THE NATURE OF A MICRO MACRO LINK. Academy
of Management Journal, Vol. 43, No. 3, 486-501 .

MILKOVICH, . B. (1990 ). ORGANIZATIONAL DIFFERENCES IN MANAGERIAL COMPENSATION AND

FINANCIAL PERFORMANCE . Academy of Management Journal, Vol. 33, No. 4, 663-691.

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