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ABSTRACT
With the exponential increases in Information Technology (IT), the 21st century competitive landscape has experienced more dynamic change than ever before. Because of these dynamic and constantly changing environments, organizational leaders have been tasked with finding new and more appropriate avenues that lead to competitive advantages in situations where the traditional tangible controls for organizational effectiveness (OE) have been challenged. These challenges to traditional controls for OE are due to intangible, tacit, behavioral variables that have become hallmarks of 21st century competitive environments. Research studies have suggested that soft or behavioral controls for OE could be the appropriate 21st century response in tandem with traditional OE controls. This paper provides an argument in support of the case for soft or behavioral controls for organizational effectiveness as a 21st century response to an ever changing and dynamic 21st century competitive landscape and as means to producing a 21st century sustainable competitive advantage.
Keywords: soft or behavioral controls, organizational effectiveness, changing dynamic competitive environments, reciprocity, trust in immediate supervisor, trust in top management, organizational trust.
Introduction
Increased globalization has challenged the organizational effectiveness (OE) of many firms, including for-profit, nonprofit, and government agencies. Traditionally, the ideologies of Taylor, Weber, and Simon, which emphasized a closed, rational, top-down hierarchical bureaucracy, machine age thinking focused on internal processes, impacted OE in the 19th and 20th centuries (Baker & Branch, 2002; McCann, 2004). However, the traditional OE predictors fall short in the face of new competitive variables, new technologies, and social and environmental changes (Chang & Huang, 2010). Downsizing, the move from vertical authority to horizontal authority, the establishment of networks and alliances, business partnerships, increases in information technology (IT), changes in organizational leadership, more stringent governance policies, and the increases in employee diversity represent organizational changes instituted by firms as a response to increased globalization (Fisher, 2009; Mueller, 2009). As environments in which organizations operate have become more competitive and complex, this has challenged the conceptualization of OE (Grainger, Soutar, & Chatterjee, 2000; McCann, 2004). Organizational leaders are realizing that traditional OE predictors are not sufficient (McCann, 2004).
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