ABSTRACT
The goal of this study was to assess the correlation between how effective the operations of Agricultural Training Institute (ATI) in the region of Visayas were in relation to its overall performance as an organization. This study was theoretically based on both the Resource-Based View (RBV) Theory and the Balanced Scorecard (BSC) Framework. A major area of this study was to analyze how the ATI’s operational efficiency was positively affected by its tangible, intangible and human-resources across the financial, customer, internal processes, and learning and growth perspectives of the institution. The methodology employed was descriptive correlation, with 116 respondents selected through stratified random-selection. A researcher-made questionnaire was employed to gather the data for this study. The operational efficiency of ATI was rated as being efficient overall, ATI’s use of tangible resources was the most positive influence on operational efficiency and on the least positive influence on operational efficiency was human resources. Overall, the performance of ATI was rated as very satisfactory across all performance perspectives, particularly with the financial and customer perspectives. There is also a statistically significant positive correlation between ATI’s operational efficiency and overall performance, indicating that as ATI improves how resources are used and maximized, and, therefore, is able to provide improved outcomes as an institution. These findings support further efforts to develop and improve the capacity of human resources and improve the internal systems, processes, and procedures within public sector organizations for the purpose of continuing and enhancing organizational performance.
Keywords: Operational Efficiency, Organizational Performance, Agricultural Training Institute (ATI), Tangible Resources, Intangible Resources, Financial Perspective, Customer Perspective, Internal Business Process Perspective, Learning and Growth Perspective
INTRODUCTION
The two characteristics that are important contributors to the ultimate success and sustainability of an organization are operational efficiency and an organization's performance/organizational success. One definition of operational efficiency is how well an organization uses available resources (financing, physical assets, and other materials, human resources (employees), internal systems) to complete its mission by maximizing the use of every dollar spent within those resources with as little wasted as possible and to minimize any type of expenditure that is not necessary (Elbanna, & Abdel-Maksoud n.d.). Organizations with efficient operations can enhance process efficiency, increase productivity, and provide services to their customers more efficiently. Because of being capable of efficiently managing their internal resources and processes, organizations increase their capability to achieve their strategic goals and to effectively respond to stakeholder needs.
In contrast, organizational performance can be described as the degree of an organization's ability to achieve its goals and to fulfill its mission. It is a measure of how effective the organization has been in delivering services and programs and producing positive results for its stakeholders. Many organizations evaluate their performance based on several areas, such as: financial management; service quality; internal operational processes; customer or stakeholder satisfaction; and their capacity to learn and grow as an organization. Both public and private sector organizations must have effective coordination of their resources, well-designed internal systems, and an effective workforce to achieve high levels of organizational performance.
Efficiency of operations is crucial for public sector organizations because of limited resources and the public sector being held accountable for spending public funds. Efficient management of resources enables public sector organizations to make the greatest possible use of resources to achieve the maximum impact of their programs, to improve the delivery of services, and to operate in a manner consistent with their objectives over time. Therefore, in this example, the organization's ability to continue improving its overall performance relies significantly upon operational efficiency as effective utilization of resources and well-managed processes increase the organization's capability to provide effective programs and achieve the desired institutional outcomes.
In particular, operational efficiency is very significant to one particular government institution, the Agricultural Training Institute (ATI), the capacity-building agency of the Department of Agriculture. It designs and implements training programs, provides extension services and disseminates information on agriculture to farmers, fishers, and stakeholders in agriculture throughout the Philippines through a network of 16 Regional Training Centers (RTCs) and one specialized training center (ITCPH). The Agricultural Training Institute’s RTCs are strategically located throughout the Philippines to enable delivery of agricultural extension services. The scope of this research includes three RTCs in the Visayas region: ATI-RTC VI, ATI-RTC VII, and ATI-RTC VIII.
One of the main criteria for determining an organization’s success is its operational efficiency. The resource-based view (RBV) theorizes that to achieve sustained organizational performance, organizations must have a set of internal resources: namely, physical, non-physical and human resources. The balanced scorecard (BSC) offers a broad definition for assessing performance through financial, customer, internal business processes, and developmental 66 perspectives.
Researched in detail is neighbouring performance measurements of local government units and higher educational institutions, such as designing Balanced Scorecard (BSC) framework for state universities in the Philippines, and are largely sector based to date. Second, while a few public sector BSC studies have been published and adapted by local governments and higher education institutions these studies only consider how certain internal organizational resources translate into performance within a public sector context. However, limited relevant combined public and private sector RBV/BSC framework studies and/or empirical research exist on how organization's incorporate RBV to translate to achieve multi-dimensional performance outcomes and deliver value to users in Philippine public sector literature. This gap results in no unified or construct explaining how and/or under what circumstances organization realize such multi-dimensional performance outcomes based on their internal RBV.
Addressing these gaps, this study integrated the RBV and BSC frameworks to examine how perceived operational efficiency influences organizational performance of the Agricultural Training Institute in Visayas Region.
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