The Secret of High Performance Organizations (HPO’s)

By Professor André A. de Waal MBA (HPO Center)

In the past few decades organizations all over the world have been searching for the elements that constitute continuous organizational success. Fuelled by bestsellers such as ‘In Search Of Excellence’ and ‘Good to Great’, managers have been trying out many different improvement concepts, often with mixed results. The aim of this study was to identify factors that determine the continuous success of a high performance organization (HPO). A meta analysis of 280 research studies into high performance initially identified 35 characteristics of a HPO. These were subsequently used in a case study of a large financial service provider, to identify its HPO status and the improvements needed to become a really excellent organization. The results of the study show that it is possible to identify factors that determine continuous organizational success, and that managers can be offered a framework that adds focus to improvement.

Keywords: High performance organizations, HPO, Management quality

Introduction

Ever increasing demands of stakeholders force organizations to adapt faster to growing international competition and to compete simultaneously on the basis of price, quality, flexibility, delivery times, and after-sales support (Kasarda and Rondinelli, 1998). They are pressured into defining the elements that make up high performance, as there is a growing consensus that effective approaches to management offer organizations competitive advantage (Lawler, 2003). In the wake of the landmark book ‘In Search of Excellence’ (Peters and Waterman, 1982) and the more recent bestsellers Built to Last (Collins and Porras, 1994) and ‘Good to Great’ (Collins, 2001), managers have developed a strong interest in learning the characteristics of high performance to help them in their quest for excellence. Identifying these characteristics is of paramount importance because clients of organizations are becoming more demanding and at the same time more dissatisfied with the performance of the organizations. In this day and age of increased importance of tailoring to consumers’ needs, organizations cannot afford bad interactions with their clients. In addition, organizations not only need to become better but even more difficult … stay better for a long period of time. As every sportsperson can tell you: “It ain’t that difficult to get to the top, staying there is the hard part.” So the search is on for the factors that do not cause a onetime good result but stress sustainable high performance. For this, I took a long and in-depth look at the so-called high performance organizations (HPOs).

Until now there has been no generally accepted name or definition of HPOs, and in the literature the HPO is often referred to as the accountable organization, the adaptive enterprise, the agile corporation, the flexible organization, the high performance work organization, the high-performance work system, the high reliability organization, the intelligent enterprise, the real-time enterprise, the resilient organization, the responsive organization, the robust organization, and the sustainable organization. In many publications a HPO is described in terms of achievements or attributes of the organization, such as having strong financial results, satisfied customers and employees, high levels of individual initiative, high productivity and innovation, aligned performance measurement and reward systems, and strong leadership (Epstein, 2004). One way of achieving uniformity of definition is to identify common themes in the literature and incorporate those into a single, allencompassing definition. In some of the common themes found after studying the literature were: sustained growth; better financial and non-financial performance compared to its peer group; long-term orientation; better results over a period of at least five years. Taking the common themes as a starting point, the following definition of HPO was formulated: A high performance organization is an organization that achieves financial and non-financial results that are better than those of its peer group over a period of time of at least five to ten years (Waal, 2006, 2007).

It Pays to be a High Performance Organization

To find out ‘the secret’ of high performance organizations…

Read the full article ‘The Secret of High Performance Organizations (HPO’s)’ published in Management Online Review in PDF.