A study on the development of instrument to measure and test organizational alignment of a multi-tier organization

• Main Author: Penaflorida, Arla Marie A.
• Format: text
• Language: English
• Published: Animo Repository 2012
• Subjects: Organizational effectiveness—Measurement; Organizational sociology; Complex organizations; Interorganizational relations; Industrial Engineering
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/4491; https://animorepository.dlsu.edu.ph/context/etd_masteral/article/11329/viewcontent/CDTG005459_F_Redacted.pdf
• Institution: De La Salle University

Performance measurement is the process of quantifying the efficiency and effectiveness of an action through acquisition, collation, sorting, analysis, interpretation and dissemination of appropriate data. This aids organizations to gauge how they are performing towards their strategy and vision as well as aligns each organizations entity to the strategic priorities of the company. Many performance measurement frameworks emerged yet balanced scorecard (BSC) was still regarded as the most widely recognized framework. It is a framework used to measure the organizations strategic indicators. However, despite of its recognition, approximately 80% of organizations that use balance scorecard as their performance measurement framework do not reap its full benefits which are characterized by operational and financial excellence within an organization. Among all the issues associated with BSC user organizations, the huge gap between BSC Hall of Fame Organization against all other BSC users is in the ability to execute organizational alignment practice. Improved operational and financial performances have been known to be the key results when organization is aligned. Main indicator for organizational alignment has been identified as demonstrating common strategic priorities within the organization through ensuring effective communication of strategic priorities and strategy buy-in within different levels of organization. Based on Kaplan-Norton organizational alignment framework, organizational alignment should be established to each level of organization in the strategic planning phase. Late detection of organizational misalignment can be detrimental to organizations resulting to poor operational and financial performance indices. In lieu with this, BSC hall of fame organizations has been reported to achieve an organizational alignment level approximated at 4.3 out of 5 rating which equates to 86%. Achieving the rate of 86% organizational alignment level is considered as best-in-class rating. High organizational alignment level is very critical especially for fast-pace and technology-based industry like semiconductors. This is due to the fact if their strategies are not executed timely and precisely, the market can easily swerve to its competitors. In the Philippines, semiconductor industry is the highest contributor in Philippine employment and the second highest revenue contributor in the country. Most instruments had been introduced to measure and test organizational alignment. However, existing instruments does not pinpoint the specific strategic priorities where organization are misaligned. Therefore, there has been a vast need to develop an instrument that will identify the organizational alignment level within different management and functional levels as well as pinpoint the strategic priorities that are misaligned and at which management and functional level it occurs. This research deals with providing an instrument that will be used to identify the organizational alignment level using commonality of strategic priorities within the different management and functional levels within the organization as indicator. This instrument aims to enable organizations to have faster feedback loop on detecting organizational misalignments at the strategic planning phase prior strategic implementation.