Competing Values Framework

Fundamentals

The competing values framework was developed initially from empirical research on the major indicators of effective organizations, but it has been elaborated to include research on a whole host of other topics—shareholder value, mergers and acquisitions, approaches to learning, organizational culture, leadership competencies, organizational designs, communication styles, organizational virtues, creativity, human resource practices, employee-job matching, financial investments, and information processing. In each case, statistical analyses have confirmed the robustness and applicability of this framework to a broad array of human and organizational phenomena. That is, the same dimensions that emerged from research on organizational effectiveness also emerged when studying a wide variety of other aspects of human and organizational activities. These dimensions compose the CVF. Figure 1 illustrates this framework.

Figure 1 Core Dimensions of the Competing Values Framework

Source: Author.

All organized human activity has an underlying structure. Completely haphazard action, or randomly dispersed elements, is said to be without organization. Organization, by definition, therefore, denotes patterns and predictability in relationships. Identifying the underlying dimensions of organization is one of the key functions of the CVF. It helps uncover the underlying relationships that exist in organizations, leadership, learning, culture, motivation, decision making, cognitive processing, creativity, and so on.

The basic framework comprises two dimensions— one drawn vertically and the other drawn horizontally—resulting in a two-by-two figure with four quadrants. The study of effectiveness in organizations three decades ago revealed that some organizations were effective if they demonstrated [Page 123]flexibility and adaptability, but other organizations were effective if they demonstrated stability and control. Similarly, some organizations were effective if they maintained efficient internal processes whereas others were effective if they maintained competitive external positioning relative to customers and clients. These differences represent the different ends of the two dimensions that makeup the CVF.

More specifically, one dimension of the framework differentiates an orientation toward flexibility, discretion, and dynamism from an orientation toward stability, order, and control. One dimension in the CVF, in other words, represents a continuum ranging from versatility and pliability on one end to consistency and durability on the other end. When referring to individuals, this dimension differentiates people who learn inductively, communicate with animated and speculative ideas, and process information by searching for innovative applications from people who learn deductively, communicate with rational and considered ideas, and process information methodically.

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