THE IMPACT OF ORGANIZATION DEVELOPMENT INTERVENTIONS ON ...Document Transcript
THE IMPACT OF ORGANIZATION DEVELOPMENT INTERVENTIONS ON
A Case Study of C.I.T. Property Consultants Co., Ltd.
Good performance management systems can have a significant impact upon the operations and
success of any organization. The broad objectives of this article are to identify the problematic areas
in the company and identify ways to improve staff performance, employee motivation and involvement.
The specific research objectives are to describe and analyse the current situation of the company and
to conduct a 3-phase diagnosis: Phase 1, identification of problematic areas which need improvement;
Phase 2 development and implementation of intervention techniques; Phase 3 monitoring and
evaluation of results after the intervention to determine the impact on the company performance. Both
the qualitative and quantitative methods of analysis were used which included interview, observation
and questionnaires. The findings are that after the ODI, staff performance improved. This
improvement has led to better performance of the organization at three levels. At the individual
level—staff perceived more motivation and that their competencies at work increased. At the team
level—staff perceived that there was an improvement in team effort. At the corporate level—the
findings suggest that improved corporate performance is linked to improved individual and team level
Key Words: Performance management, Employee motivation, Employee involvement, Teamwork
Introduction were employee motivation, employee
involvement and teamwork.
It is recognised that human resource The type and manifestation of problems
management of considerable importance in vary from one organization to another.
the management of organizations (Singh, Therefore, methods used to study and
1992, p. 116). The competitive advantage of suggest solutions to these problems also
an organization depends on how well its differ from one organization to another.
human resources are managed (Mendonca & C.I.T’s corporate performance when it
Kanungo, 1996). Performance can be first took over from Pasupat was not at all
considered an outcome of both impressive. There was no unity among staff
organizational and human activities (de members and there was a high rate of staff
Waal, 2003). The objective of this turn-over. Staff performance was rather poor
dissertation was to apply these theories in or sub-standard. CIT stakeholders were not
practice, using C.I.T as a case study. What it satisfied with the corporate performance
aimed to do is to analyse the corporate because its revenue was not high as it should
performance of C.I.T, identify the problem be.
areas, and to find ways to rectify the The researcher, as the Managing Director
identified problems which, in the C.I.T case, of the company, took this opportunity to
apply the knowledge he learnt from the
course, to identify the problem areas,
1. Patima Jeerapaet is the Managing Director strategically initiated ODI activities based on
of C.I.T. Property Consultants Co., Ltd, a information other authors wrote in this field,
property consultant company. He is also a and analyse the results of the ODI he
chairman of the Joint Foreign Chamber of implemented. It was expected that the ODI
Commerce in Thailand (JFCCT).
activities would improve staff performance, outcome of both organizational and human
resulting in improved corporate performance activities (de Waal, 2003, p. 688).
which would satisfy CIT stakeholders and Performance management has much wider
shareholders. implications than that of simply improving
individual performance and providing a
Performance Management basis for performance-related pay. It is also
concerned with three key features of
The competitive advantage of an organizational life: human resource
organization in a global economy depends management (HRM), continuous
primarily on how well its human resources development, and teamworking (Armstrong,
are managed. Of course, the financial, 1994, p. 26). Poor performance has a
technological, and other material resources negative impact on company revenues along
are undoubtedly also critical to the the same lines as downtime. There is a
organization’s success in the competitive negative effect either through lost
global market, but these resources are opportunities, lost revenue (Brady, 2002, p.
generated by the industrious and creative 4). There is a growing trend towards
efforts of people, and it is their ingenuity managing performance improvement
that also ensures that these resources are through focusing on the underlying drivers
effectively deployed. Hence, the importance of performance. Performance management is
of the human resources function is a term widely used within HR and has a
increasingly being recognized. specific meaning associated with reviewing
Developments in human resource and managing an individuals’ performance.
management techniques and practices to However, there is also a growing concern in
promote work motivation particularly performance measurement that measuring
through performance management, work performance is not enough. Measurement
design, reward systems, employee has to lead to insight and insight to action –
supervision, and organization development hence the term corporate performance
and change strategies, have enabled management has been used to differentiate
organizations to create conditions which between management at the level of the
foster, promote, support, and reinforce individual and the corporation. More
employee effectiveness. These techniques recently, the concept of multiple
and practices give organizations the stakeholders has come to the fore.
competitive edge both in the short and long Companies can no longer be satisfied with
term, as well as in their domestic and only considering shareholders and customers.
international markets. Some argue that Employees are also seen as important
adopting management practices which have stakeholders, as are suppliers, regulators and
proven to be effective is a better alternative the community at large and these have
for an organization than needlessly to invest adopted different approaches to this
its limited and scarce resources in efforts, challenge (Bourne, Franco & Wilkes, 2003,
which do not amount to much more than p. 16). For as long as one person has been
“reinventing the wheel”. In any event, the engaged in furthering the aims of another,
poor management practices, bureaucratic the employer has been concerned with ways
inefficiencies, and low productivity levels of motivating the employee to maximize the
that are endemic in many of these effectiveness of the enterprise. Given the
organizations, create consider able pressure link between employee behavior, HRM and
for managers to adopt speedy, ready-to- company performance, the lower employee
implement strategies. They, therefore, hoped turnover and greater productivity should be
that such adoption would enhance their (Roos & Fernstrom, 2004, p. 31).
effectiveness, and give them a fighting Performance management can satisfy a
chance in the fiercely competitive global number of the fundamental aims of HRM, to
markets (Mendonca & Kanungo, 1996, pp. achieve sustained high levels of performance
65-66). from the organization’s human resources;
Performance can be considered an
develop people to their full capacity and are often observed when a group of
potential; establish an environment in which individuals works as a team: shared job
the latent potential of employees can be duties, cross-over of skills, flexibility in
realized; reinforce or change the substitution, desire to involve everyone,
organization’s culture. Performance equal sacrifice and commitment, understood
management is also concerned with the and supported overarching purpose.
interrelated processes of work, management, In order to be successful, the leaders need
development and reward. It can become a to encourage and support your frontline
powerful integrating force, ensure that these employees to work together, to be unified in
processes are linked together properly as a purpose and action. The word synergy is
fundamental part of the human resource often associated with teamwork, because as
management approach which should be the people in a group develop an
practiced by every manager in the environment of giving and receiving and as
organization (Armstrong, 1994, p. 26). they share ideas develop working together
The organization has operated successful relationship, their combined action produces
because of good performance management results that are greater than they could
systems. The Performance Management is achieve if each were working alone
the fruit of an organizational structure, its (Humphrey & Stokes, 2000, pp. 59-60).
teamwork, its employee motivation and its The capability of a group reflects
employee involvement. members’ effectiveness at using their skills
and experience to accomplish the work in
Teamwork their area. Maturity reflects group members’
effectiveness at making decisions that
Performance management is often treated consider work needs and employees’ needs
as if it were just a matter between managers and abilities and that are sound from a
and the individuals reporting to them. But it practical and business perspective. Maturity
can also enhance teamwork by asking teams is not reflected by a group that makes
to identify interdependencies and set team decisions based on selfish desires or the
objectives and by getting their members most convenient solution. Finally, the drive
jointly to review progress in achieving them. of a group reflects members’ motivation and
Teamwork can also be enhanced by setting enthusiasm for learning and achieving
overlapping objectives for different greater performance results (Humphrey &
members of a team (Armstrong, 1994, p. 27). Stokes, 2000, p. 60).
In a team-based organization, the Teamwork is essential for competing in
performance not only of the teams as a today's global arena, where individual
whole but also of their individual members performance is not as desirable as a high
needs to be managed and managed very well level of collective performance. In
if tall performance (consistently competent, knowledge based enterprises, teams are the
ethical, and motivated behavior that always norm rather than the exception. A critical
produces the best results) is to be reached feature of team in our company is that
and sustained (Brumback, 2003, p. 167). employees at the management level have a
In most instances, when organizations say significant degree of empowerment, or
they want teams, what they really want is decision-making authority. Aside from the
teamwork. That is, they want people within a required technical proficiency to enhance
work area to cooperate with one another, to teamwork within the organization
make decisions together, and to work
together toward a common goal or objective Employee Motivation
(Humphrey & Stokes, 2000, p. 59). In the
end teamwork will gain greater performance Motivation is one of the critical links
results because people are working together between the organization and the individual.
rather than independently of each other. That link is expressed in productivity,
There are a number of characteristics that satisfaction, and personal involvement.
Motivation consists of a variety of forces
that direct behavior toward a goal (Garrison helps appeal to and satisfy the need people
& Bly, 1997). have to achieve and be recognized for their
achievement (Sims, 2002, p. 69).
As the trend continues to shift toward
self-managing teams, employees cannot be
expected to turn into motivated self-
Today, organizations are increasingly
managers overnight; they need to be given
empowering their work teams. Empowering
the proper tools through development and
does not just mean assigning broad
training programs. When employees appear
responsibilities. Teams also need the training,
to be unmotivated, managers will need to
skills, and tools to allow them to do their
size up the leadership situation, identify and
jobs, such as in consensus decision making.
understand what is happening, and formulate
Firms like Saturn also make sure their
a response. Knowledge about the theories of
managers actually let their people do their
motivation, discussed in the previous section,
jobs as assigned (Sims, 2002, p. 72).
should help managers identify and
understand the motivational problems they
face. In this section, possible methods to
Managers and employees need to
motivate employees are described. One
understand each other’s goals. In addition,
reason these motivation methods are widely
managers are responsible for helping
used is the fact that they have strong
employees in setting goals or objectives.
foundations in motivation theory and
With a clear understanding of explicit goals
research. For example, empowering
or objectives, managers and employees can
employees is based in part on self-efficacy –
work together to achieve specific outcomes.
namely, on the idea that people differ in their
Several attributes of goals are especially
estimates of how they will perform on a task.
important for improving performance: goal
Therefore, building their skills and self-
specificity, goal difficulty, and goal
confidence by empowering them should
acceptance (Sims, 2002, p. 73).
bolster their self-efficacy and thus their
Motivation is the force that drives
employees towards a common objective.
1. Pay for Performance
Employees are motivated with performance
Pay for performance is probably the first
incentives, team spirits, achievement
thing that comes to mind when most people
recognition, open line communication,
think about motivating employees. Pay for
respect, trust and involvement.
performance refers to any compensation
method that ties pay to the quantity or
quality of work the person produces. Employee Involvement
Similarly, behavior modification emphasizes
that people will continue behavior that is Today an increasing number of
rewarded, and pay for performance plans, of organizations see the potential advantages of
course, tie rewards directly to behavior having more frontline workers involved with
(Sims, 2002, p. 64). growing the company. Although different
companies may define employee
2. Recognition involvement somewhat differently and use
Being recognized for a job well done – various means to obtain it, many employee
and not necessarily just financially – makes involvement efforts involve the formation of
a lot of sense in terms of motivation theory. natural work teams.
Immediate recognition can be a powerful
reinforcer, for instance, and can provide As employee involvement efforts take on
some immediate outcomes to counterbalance team like dynamics, supervisors must have
the employees’ inputs or efforts. the skills necessary to build and grow teams.
Recognition also underscores the Frontline leaders will recognize the
performance-reward-expectancy link, and it difference between a group of people and a
real team. They will actively grow their natural resource and capital asset of the
teams, understanding the stages every team organization and the most important source
will experience and knowing how to develop of sustainable competitive advantage (Jamali,
individuals into members of a high- Khoury, & Sahyoun, 2006, pp. 338-339).
performance work team (Humphrey & Management through delegation creates a
Stokes, 2000, p. 58-59). more nurturing environment in which staff
can learn, grow, improve and function
Empowerment and Delegation effectively. A further development to
delegation is empowerment. Staff
Globalization that has occurred since the empowerment gives employees a sense of
beginning of the 21st century makes the trust, importance, capability and thus creates
world become more dynamic and move at a a positive work environment. It also enables
faster pace. Due to increased economic personal and professional growth. The
integration and reduced trade barriers, leader believes that empowerment is derived
globalization creates greater movement of after a period of time working together. The
people, capital, ideas, and goods. Bigger leader must be able to judge an employee’s
markets can mean bigger profits if capabilities and trust that person with
companies /organizations make every effort decision-making in the best interests of
to capitalize on them. Global competition is business operations. No doubt the
so strong that organizations will require empowered person will have freedom of
making adjustments to the way they do choice and action, but there is a ceiling in
businesses as well as to their management decision making that the empowered person
styles in order to keep pace with the rapid can undertake. Good leadership is like good
change. Therefore it is a real challenge in parenting: communication, coaching and
how to manage the organizational behaviour monitoring from time to time is required.
to meet strong field of global competition. The ‘Involve them’ management style –
To be successful in global competition, “Delegation” and “Empowerment.” There
organizations not only should respond are countless benefits to be gained by
positively to the competition in the applying them to the full. It is very important
international marketplace but they must also for the company to create the atmosphere
be more responsive to ethnic, religious, and that nurtures staff abilities and motivates
gender diversity as well as personal integrity them to improve their productivity through
in the workforce (Nelson, 2006, p. 15). shared knowledge and information and
Managing the organizational behaviour empower them to make decision based on
during changing times is challenging for at these shared knowledge. Their good work
least four reasons: (1) the increasing must be recognized and rewarded.
globalization or organizations’ operating Empowered staff are contented and this flow
territory, (2) the increasing diversity of through to customers. The firm’s success is
organizational workforces, (3) the based on our ability to produce superior
continuing demand for higher levels of results for our clients. With strong global
moral and ethical behaviour at work, and (4) competition, increasing number of happy
continuing technological innovation with its customers may lead to increasing market
companion need for skill enhancement. share of the company.
These are the important issues to address in
manage people at work (Nelson & Quick, Theoretical Framework
2006, p. 18).
Management in the twenty-first century The model as depicted in Figure 1 shows
has accordingly taken a new orientation, and that performance is an outcome of both
is capitalizing on a different approach to organizational and human activities but the
managing employees than the traditional most important contributing factor is human
disciplinarian, command and control resources. Motivated staff is productive and
philosophies. People are treated as the can perform well. Therefore, performance
management can satisfy a number of the
fundamental aims of HRM, to achieve researcher notes and observations. The
sustained high levels of performance from researcher chose to record notes of all
the organization’s human resources; develop interviews which provide the best data for
people to their full capacity and potential; analysis. In this research, such data
establish an environment in which the latent collection provided the best means of
potential of employees can be realized. validating the information gathered and in
Performance management is also concerned facilitating ongoing reflection and
with the interrelated processes of work, assessment (Denzin and Lincoln 1994).
management, development and reward. It The researcher was able to observe some
can become a powerful integrating force, limited, informal and formal conversations
ensure that these processes are linked and meetings. While observation did not
together properly as a fundamental part of form an important part of the data collection,
the human resource management approach it did provide additional input.
which should be practiced by every manager While interviews are typically classified
in the organization. as structured or unstructured, interviews in
this research were semi-structured. These
initial questions changed based on the
. interaction between the interviewees and the
researcher, as well as based on the
Corporate Performance emergence of new ideas, and is an accepted
Effectiveness qualitative methodological process (Yin
1989; Stauss and Corbin 1998).
This investigation is designed as an
action research conducted in the real
situations. There are three stages in this
research, 1) the diagnosis stage, 2) the ODI
Team grown in capacity
stage and 3) the evaluation stage.
Individual members learn
Phase I: Diagnosis Situation Analysis/
Employee Involvement The diagnosed situation assessed here is
Empowerment / Delegation the transition of Pasupat Realty Co., Ltd. to
C.I.T. Property Consultants Co., Ltd. Human
Resource Management is considered a
Individual Motivation priority. This research will analyze the
Goal Setting/Performance current situation of the company. This
Appraisal/ Reward System/
Coaching & Training
research will also analyze the employees’
capabilities, competence and attitude.
Figure 1 Theoretical Framework
Phase II: Identify, Develop & Implement
The research identified, developed and
The research process is iterative. The implemented the organization intervention
processes of data collection, analysis and which are appropriate for the company. The
drawing and verifying conclusions are required interventions are in terms of
collapsed into one evolving, reduction teambuilding, Human development, goal
process (Miles & Huberman, 1994) enabling setting, performance appraisal, adjusted
insight into employee motivation. Data in reward systems, coaching and training
this research consists of interviews, Phase III: Monitor & Evaluate
executive notes of interviews, questionnaires, Desired/Expected Results (Post-ODI)
organizational documents of various types,
The interventions were closely monitored videotape and other methods to record
to determine the level of employee behaviours (Cummings & Worley, 2005).
involvement, employee motivation after the
ODI. Its results would be analyzed and Tools for Qualitative and Quantitative
evaluated with job satisfaction, Analysis
organization’s growth and corporate
performance effectiveness. The researcher did not use significance
testing in the quantitative analysis. Reasons
Research Instruments, Tools and other for this are that the issue of verification in
Data qualitative research differs from the same
issue in quantitative research. Consensus
In this research, there are 3 instrumental amongst qualitative researchers, however,
tools in the forms of questionnaires, remains elusive. For example, Denzin and
interview and observations. Lincoln (1994), suggest trustworthiness and
authenticity are more appropriate than
1. Questionnaire covered the following
reliability and validity, as understood in a
positivistic sense. It is the credibility of
• Employee satisfaction survey, sense-making that the researcher seeks. The
philosopher, Popper, proposes that the aim
• Organization Communication,
of science is to find “satisfactory
• Team work, explanations” (Popper and Miller, 1985
• Employee motivation, p.162), and that these explanations need to
• Employee involvement (Empowerment meet a number of criteria, including the need
& delegation), for the explanations to properly relate to the
• Employee performance Evaluation matters they purport to explain, for the
explanation to meet some minimum
2. Interview standards of truthfulness and for the
A second important measurement explanation to be testable. Furthermore, the
technique was the individual or group explanations are satisfactory when they
interview. Interviews were the most widely cannot be shown to be false (Popper and
used technique for collecting data in OD. Miller, 1985). In this sense verification is
They permit the interview to ask the linked to falsifiability, and that this makes
respondent direct question. Further probing good science. Popper believes that a theory
and clarification was, therefore, possible as is falsified “only if we discover a
the interview proceeds. The flexibility was reproducible effect which refutes the theory”
invaluable for gaining private views and (Popper and Miller, 1985 p.150).
feelings about the organization and for So, the action research undertaken in this
exploring new issues that emerge during the thesis uses intervention to explain
interview. phenomena in ways acceptable to qualitative
research scholars. Its construct validity is
3. Observations manifested via the multiple sources of
The researcher will observe by walking evidence used to verify an explanation
casually through a work area and looking through the triangulation of data. In this case,
around or by simply counting the it is reasonable to expect another researcher,
occurrences of specific kinds of behaviours. working with the same set of data, would
Observations can range from complete arrive at a similar explanation. Internal
participant observation, in which the validity is manifested in the credibility and
researcher becomes a member of the group authenticity of what data arises from
under study, to more detached observation, interviews, observations, records,
in which the observer is clearly not part of questionnaires, etc., as these provide the
the group or situation itself and may use “truth value” of the data collected. The
researcher is concerned to establish that the
account provided “rings true” (Miles and In consultation with team leaders and
Huberman, 1994 p.278 and 279). department heads, the researcher initiated
activities which aimed to improve staff
Design/Development of OD Interventions performance, and help rectify the three
problems above. These included
As a result from Pre-ODI diagnosis, the performance appraisal, goal setting, adjusted
company realized that at the individual level, reward systems, human resource
some employees had less competency and development, teambuilding, coaching and
poor performance. The ODI tools targeted training. These activities were implemented
for improvement are the goal setting, in the year of 2008.
performance appraisal, reward systems,
coaching and training, career planning and Quantitative findings
development. The company expected Post
ODI to provide higher effectiveness and Sixty employees in every department were
better performance of individual employee. asked to fill in a questionnaire which was
At department (team) level, there was designed to measure the changes in staff
less motivation and poor team working. The behaviour, attitude, staff morale and the
ODI tools targeted for improvement were level of team work before and after the
more employee involvement as a team, the implementation of the ODI activities. The
goal setting, performance appraisal, reward same questionnaire was completed in Phase
systems, coaching and training. The I before the ODI and in Phase III after the
company expected Post ODI to provide ODI. Questions asked in the survey were
higher motivation and better team relevant to the three problem areas, but
effectiveness. particular ones can be used to assess the
At the organizational level, the company extent of improvement in each of the
realized the need to have all employees’ problem areas.
involvement which was resulted in strength The results from the two surveys were
and unity of the company. compared to find the impact of ODI
The Post ODI was expected to result in activities (Phase II) carried out throughout
better corporate performance. the year 2008. The ODI activities have been
successful in rectifying the identified
Summary of findings problems and achieving positive outcomes at
the three levels:-
The researcher carried out an interview (a) Individual level – staff felt more
with seven department heads and eight motivated and their competencies increased.
managers to ascertain possible causes of They were satisfied with the revised reward
poor corporate performance. In addition to systems, coaching and training the company
the interviews, the researcher observed staff provided to them. They knew the career path
behaviour and the interactions between they want to pursue. Their communication
employees, as a means to understand staff skills improved not only among the
behaviour and attitudes as a reflection of colleagues, but also in effective upward and
morale. downward communication processes
between supervisors and subordinates
It was found from the interviews and the
researcher’s observation that the causes of
poor corporate performance were poor staff (b) Team level – staff felt that there was
performance, the root causes of which were:- an improvement in team work. Department
1. un-motivated staff and low morale heads reported that the quality of work of
2. lack of teamwork, and their staff improved and they were more
3. poor work involvement willing to help their colleagues. Staff were
more cooperative when they were asked to
complete a task. There were increasing Brumback, G. B. (2003). Blending “we/me”
number of brainstorming sessions and in performance management. Team
department heads observed that their staff Performance Management, 7(8), pp. 167-
contributed more in discussions. Because of 173.
the more frequent and changed nature of
communication between people, work Cummings, T. G., & Worley, C. G. (2005).
progressed smoothly. They shared the same Organization development & change (8th
goals and as a team tried to achieve the ed.). Mason, OH: Thomson/South-Western.
target. Staff was more satisfied, after
receiving appropriate coaching and training, Denzin, N.K. & Lincoln, Y.S. (1994)
especially with empowerment and Handbook of Qualitative Research (1st ed.).
delegation bestowed upon them. London: Sage.
(c) Corporate level – this dissertation Garrison, M., & Bly, M. A. (1997). Human
argues that improved corporate performance relations: Productive approaches for the
is linked to improved individual and team workplace. Boston: Allyn and Bacon.
level processes. Corporate performance
improvement is measured by an 85% Humphrey, B., & Stokes, J. (2000). The 21st
increase in the company income between century supervisor: nine essential skills for
2007 and 2008. frontline leaders. San Francisco: Jossey-
Jamali, D., Khoury, G., & Sahyoun, H.
With the 85% increase in the company (2006). From bureaucratic organizations to
income, the researcher suggests this is due to learning organizations: An evolutionary
the ODI activities initiated that were largely roadmap. The Learning Organization, 13(4),
effective and successful. There were no pp. 337-352.
major areas that are left unanswered or
unresolved. The findings emerge from using Mendonca, M., & Kanungo, R. N. (1996).
both qualitative and quantitative analysis and Impact of culture on performance
confirmed that the ODI matched with the management in developing countries.
conceptual framework. There was a International Journal of Manpower, 17(4/5),
significant difference between pre and post pp. 65-75.
ODI in all three areas: employee motivation,
better teamwork and employee involvement. Miles, M.B. & Huberman, M.A. (1994).
Qualitative Data Analysis (2nd ed.)
Thousand Oaks: Sage.
Nelson, D. L., & Quick, J. C. (2006).
Armstrong, M. (1994). Performance
Organizational behavior: Foundations,
management. London: Kogan Page.
realities, and challenges (5th ed.). Mason,
Bourne, M., Franco, M., & Wilkes, J. (2003).
Corporate performance management.
Roos, G., & Fernstrom, L. (2004). Human
Measuring Business Excellence, 7(3), pp.
resource management and business
performance measurement. Measuring
Business Excellence, 8(1), pp. 28-37.
Brady, J. (2002). A strategy for managing
performance. Retrieved August 22, 2007,
Sims, R. R. (2002). Managing
organizational behavior. Westport, CT:
Singh, R. (1992). Human resources
management: The key to competitive
advantage. Engineering Management
Journal, 2(3), pp. 116-120.
de Waal, A. A. (2003). Behavioral factors
important for the success implementation
and use of performance management
systems. Management Decision, 41(8), pp.
Yin, R K. (1989). Case Study Research:
Design and Methods (5th ed.). Newbury Park,