There are three basic types of indicators-- those based on outcomes, on
processes, and on structures (Scott p. 353).
Outcomes focus on materials or objects on which the organization has performed
some operation (Scott p. 353). These are the most common effectiveness measurements,
but can be the most difficult to define and measure and are not immune to
ambiguity and measurement error. Outcomes in some organizations are also
a function of competition and technology levels, which makes it difficult
to separate the effectiveness of the organization from other environmental
variables. One approach to help remedy this is to focus on comparisons with
similar organizations, though one must acknowledge that the organizations
may have differing access to environmental resources. It can also be hard
to track outcomes of the products once they are released into the environment
(e.g., students, patients).
Process measures assess effort rather than effect (Scott p. 355). Some measure
work quantity or quality. Though they are in some respects a more pure measurement
of organizational performance, they are an assessment of conformity of a
given objective that can be decoupled from output performance (and ultimately
Substituting process evaluation for outcome evaluation can also force the
customer to accept service instead of value. A student confuse teaching
with learning, a diploma with competence, etc. (see Illich 1972 for a discussion).
However note that in some institutions (churches, legal firms, etc.) conformity
to a process is the primary output and can be the most appropriate measurement.
"Structural indicators assess the capacity of the organization for
effective performance" (Scott p. 357). These are often include organizational
features (equipment age or type) or participant characteristics (degree
attained, liscensing, etc.). Structural indicators form the basis for accreditation
reviews and licensing systems.
"Structural indicators focus on organizational inputs as surrogate
measures for outputs." (Scott p. 357). Yuchtman and Seashore (1967)
suggest that "bargaining position" and ability to acquire scare
resources is an important criteria of effectiveness.
Like with process, focus on structure can have it's own problems. For example,
licensing and accreditation through structural evaluation have become a
major obstacle to innovation in schools.