I am totally agreed with the statement of Bititci - “The best-performing companies worry less
about performance and more about their organizational capabilities.” I believe when the
company is giving more focus to the organizational capabilities and developing competence, it
includes everything like technical expertise in manufacturing, finance, marketing, motivating
people, communicating a vision, managing risks and others. And, when the company is
delivering on the combined abilities and competencies of its individuals, the organizational
capabilities get to emerge. Here, the company can add more value by focusing on the talent,
speed, accountability, coherent brand identity and shared mindset, learning,etc. (Capitalizing
on capabilities. Harvard Business Review, 2014). All parts of the business can bind up
together with the organizational capabilities. This results in growing the business of the
company and directly influences the performance of the organizational settings. Thus, the best-
performing companies are giving more emphasis on organizational capabilities and less focus
on their performance.
The organizational culture within the company determines the employee’s engagement at the
workplace, how they are performing at the workplace, and the bottom lines of the company.
The organizational culture must be maintained, developed and nurtured to improve the
performance and the capabilities of the company for a long-run period. It has been found that
the organizational culture has three ways that directly affect the performance of the
organization, such as business goals are supported, productivity rises, and performance of the
business is improved (How culture impacts performance. Raine Digital, 2020). According to
authors Shahzad, Luqman, Khan, and Shabbir (2012), the organizational culture has a huge
impact on different organizations performance, processes, and its employees. They support
various dimensions of the work culture. They say if employees are committed to the
organizational values and norms, then it will result in enhancing the organizational
performance, and the company can easily achieve the goal and objectives set for the
organization (Shahzad et al., 2012). Thus, organizational learning can only get encouraged
through the participative and active work culture in the organization that can improve the
performance and capabilities of the organization.
Here, Company A and Company B have a significant role in the growth of their respective
business. The companies give focus on effective strategies, including designing, planning and
delivering the organizational capabilities to the company. I think the organizational culture
and capabilities of company A have more potential to improve its talent, coherent brand
identity and shared mindset, speed, and accountability. It has given the focus on the
performance of the employees to propel its business growth. On the other hand, Company B
has set up its vision on collaboration, strategic unity, conducting a capabilities audit, customer
connectivity, leadership, innovation, and efficiency to enhance the business growth. These
two companies have maintained a great organizational culture that is engaging more
employees in the workplace and showing more capacities to achieve their goals.
I agree with the statement that some of the best performing companies are likely to put more
focus on organizational capabilities, and I can understand why it is a smart decision for them
to make. By placing focus on the organizational capabilities, leadership will be able to identify
weaknesses in the organization's current practices and provide solutions that will strengthen
the internal processes of the company. By focusing on the organization of these capabilities’
companies are then able to determine areas of strength and competitive advantage as well as
areas for improvement. While I do agree that some companies place more worry on the
organizational capabilities than their performance, I do feel that some emphasis should remain
on the actual performance of these capabilities. To focus mostly on the capabilities of a
company will provide little help in assessing its performance. Given that perceived
capabilities are much different from the actual and realized ones, a company must maintain a
measurement of performance towards these capabilities to ensure that they are beneficial.
Simply having organizational capabilities will make a business able to be successful and
efficient, but if they are unable to be led or put to any meaningful use, then these
organizational capabilities do little to provide for the company. I agree with this quote to an
extent but definitely feel that it is just as important to monitor the performance of these
perceived capabilities to understand how the business is actually moving forward.
Organizational culture affects capability and performance because it determines the
environment in which they take place in. Organizational culture provides a basis for
employees to come together and collectively produce the capabilities in question. Without
organizational culture, there is no opportunity to bring these capabilities together and perform
in the intended fashion. Poor organizational culture builds a dull and inefficient workspace
which inhibits the capabilities of the employees individually and collectively, and deters high
performance. A weak organizational culture will provide ample opportunity for
miscommunications and failed checkpoints which would decrease efficiency and productivity,
as well as limit the capabilities of the organization. High organizational culture will likely
provide employees with an environment in which they are easily able to come together with
their individual and collective capabilities to then perform at the highest possible standard. An
active and participatory culture will likely lead to more communication and growth between
the employees which will only help to make the business better. e This organizational culture is
extremely important due to its ability to affect the environment in which the work and
communication takes place, and therefore should be maintained to prevent any loss or
reduction in capabilities and performance of employees and the company as a whole.
Company A’s leadership interviews demonstrate that the leadership is working on the same
team and towards the same goals which indicates a good organizational culture. The leaders
all seemed to be in conjunction with one another on the direction of the company as well as its
current business situation. Company A’s leaders were aware of its current strengths and
weaknesses and offered ideas for possible solutions or opportunities to advance its current
position. This demonstrates that Company A has good organizational performance and helps
explain why the company is at its current position of success.
In contrast to Company A, Company B’s leadership interviews do not present a solid
understanding of the business and its intended direction. The interviews as a whole were
connotated with the notion of a newly instituted leadership without much bearing on where or
how to move the company forward. This certainly helps to explain why Company B has
experienced issues with maintaining growth over the years and shows that its management and
leadership has not recently been effective in determining a way to move forward with the
company. This lack of organizational performance helps explain why Company B is not
performing at the same levels it did previously and points to the importance of a strong
leadership in the setting of overall organizational culture. e
I think that the varying levels of organizational performance between the companies is the
major driver for the difference in success that each company has had. A strong organizational
culture works to maintain the widely held ideas and objectives that work to push a business
forward and a lack thereof will result in stagnancy. The organizational culture of Company A
is much stronger than Company B’s and is the reason why Company A currently sits in a better
position. Company B likely needs more time to accommodate the new hires and bring them
together to a point at which they can work cohesively towards the same task. Ensuring that is
possible will allow the organizational performance of Company B to increase dramatically and
will result in a more able and successful business model.
"The best-performing companies worry less about performance and more about their
organizational capabilities" (Bititci, 2015).
Currently, I would agree with this statement, and I'll use a personal example for further
context. I work for a small textile company which sells rolls of fabric to various clients and we
held a staff meeting for the first time in about 6 months. A great deal of this meeting revolved
around the sales performance of 2021, both overall and on a customer basis. While there were
both positive and negative results, the leaders of the meeting were not only encouraging for the
2022 sales outlook but also made it apparent to highlight specific new and improved
capabilities the company currently displays. So, while I believe every company should value
the importance of performance and performance evaluation to a high degree, the great
companies should worry (I prefer "focus") more so about their organizational capabilities.
After reviewing the interview memos for Company, A and Company B, I can see the handful
of differences between both companies. Company A appeared to have more of a focus on its
organizational capabilities compared to Company B. Each division for Company A
highlighted multiple capabilities, most of which focused on the overall customer experience.
This shows a cohesive culture in which Company A gears its focus towards optimizing each
customer's travel experience. I find this to be a positive organizational culture as it is vitally
important to have ideals in valuing customers throughout an organization. On the other hand, I
have the impression of a much clearer divide amongst Company B's various divisions. While
ambitious, I found the interview notes on Company B's President and IT Manager to be both
unrealistic and a bit reckless. The President and IT Manager are incredibly gung-ho with its
newly integrated technology, but divisions such as Sales and Operations have been clearly
negatively affected by all the immense focus on this technological undertaking. With such
strong opinions from subordinates regarding the upper management of Company B, the
cultural divide is very much apparent. When leaders have tunnel vision regarding one specific
aspect or capability, it steers the company focus away from the other critically important
capabilities that require time and attention, which as a result brings employee morale down,
negatively affecting both company culture and overall performance.
My initial reaction to the concept "the best-performing companies worry less about
performance and more about their organizational capabilities" (Bititci, 2015), I was rather
skeptical if this idea is entirely accurate. I do feel as if companies whom perform well, focus
on the input provided by all forms of employees from any level, as well as implementing an
organizational culture focused on collaboration and feedback. "Organizational culture affects
all aspects of your business, from punctuality and tone to contract terms and employee
benefits. When workplace culture aligns with your employees, they're more likely to feel more
comfortable, supported, and valued."(Wong 2020) These aspects contribute to a company’s
success, but so does performance management. Performance measurement is essential for
fostering organizational improvement. The significance of having an effective performance
measurement process has only grown as businesses large and small realize that long-term
success depends on reaching goals with limited failure in today's highly competitive business
world. The importance of performance measurement isn't always easy to justify, but it's
necessary for performance improvement in the long run. Effective performance measurement
helps companies identify their strengths and weaknesses, top high performers, areas for
improvement, and helps set benchmarks with historical data. I understand the aspects the
individual is attempting to portray, which is focusing on what the organization is capable of
rather than setting targets which can act as limits.
A strong culture is a common denominator among the most successful companies. All have
consensus at the top regarding cultural priorities, and those values focus not on individuals but
on the organization and its goals. "Leaders in successful companies live their cultures every
day and go out of their way to communicate their cultural identities to employees as well as
prospective new hires. They are clear about their values and how those values define their
organizations and determine how the organizations run." (SRHM 2019) Organizations that are
aligned in goals and the mission show entrust in the leaders and a winning culture. The most
important success for any organization is having the buy-in culture at 100% and focusing on
investing in the employee’s capacity to provide insight and suggestions that excite them. With
employees seeking a workplace that intertwines with their belief systems, common vision, and
purpose, it befalls upon the leaders to shape an organization that unifies their people around a
shared cause.
Company A offers some concerns about employee retention and maintaining a strategic plan
for their employees. The HR Director states' "we’ve got a strong workforce, from the
custodians and cleaning crews all the way to the pilots and management team. Everyone who
needs to take annual refresher courses gets them … but we have no budget for extras.
Sometimes I worry that we’re falling behind and that we’re losing our most valuable
employees." This individual makes it clear that the refreshers are not enough to keep
employees educated, limiting the capacities of the organization as they cannot budget in the
on-going education. The HR director made it clear that the company does not make substantial
investments in training and development beyond what is strictly required for licensing and
safety. She feels that this limits the opportunities for creativity and innovation, but she also
understands budget restrictions. Among her concerns are the limited opportunities for upward
career mobility and too few career path opportunities in the company. This is a sign that the
organization lacks focus on their employee’s education or rewarding their hard work with
competitive pay. The COO mentions that he is also concerned about recruitment, especially
for pilots and for skilled technicians. Because they operate in a great location, they have not
been keeping up on their compensation levels, and this may make recruitment difficult soon.
Company B offers an enticing future with the new perspective brought by the president. Her
strongest beliefs are that the way to move the company forward is through the adoption of an
agile culture, empowering employees, and placing emphasis on innovation. This is evident as
the firm has recently entered a strategic partnership with a software company and that they
will soon bring new levels of travel convenience to the customers right in the palms of their
hands. Notably, the operations and maintenance manager also believe in the culture of the
organization. This individual stated “the company has some very seasoned individuals in the
maintenance and operations areas, several of whom have prior military experience. They pride
themselves on a positive performance record, especially pointing to the statistic that their
aircraft, while older than many fleets, are well maintained and average a 90% availability rate,
consistent with industry averages. The crew is innovative and hardworking, but there has been
substantial turnover in recent years. Several current mechanics are in probationary status, still
acquiring their technical certification credentials. There is some concern that the core of
expertise resides in the employees that are approaching retirement age and that there is
inadequate knowledge transfer." After taking a look at both interviews, we see that Company
B is more focused on capabilities over performance, while Company A is the other way
around. The company’s results show that Company A is more success financial and
performance wise than Company B, seeing an increase in their business, rather than a decrease
in sales like Company B. This proves that organization capabilities do not always translate to a
well-performing organization.
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