Hierarchical structuring of organizational performance using interpretive structural modeling

Today´s intense competition forces organizations to examine how they can improve performance as they seek to enhance their competitiveness. In order to design and implement an effective program for performance improvement, the interrelations among performance criteria and factors affecting them need to be understood. For this purpose, this study used interpretive structural modeling to represent the interrelationships among seven performance criteria and 19 factors in a simple, hierarchical structure model. The bottom level of this structure contains 12 factors, namely employee selection, employee training , work environment, employee incentives, organizational culture, leadership style, efficiency, size of organization, organizational/commercial resources, product life cycle, internationalization, and employee satisfaction. This mean that any action improving performance must start from these factors. This study´s findings will be beneficial for organizations that are planning to enhance their performance.