Diagnosing organizational effectiveness
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  • 1. Diagnosing Organizational Effectiveness A Roadmap toward Corporate Sustainabilitywww.exploreHR.org 1
  • 2. Contents 1. Comprehensive Model for Diagnosing Organizational Systems 2. Organization-Level Diagnosis : Strategy, Structure, Culture, People and Technology 3. Group-Level Diagnosis : Group Dynamics and Group Performance 4. Individual-Level Diagnosis : Employee Satisfaction and Performance 5. Designing Effective Organization Intervention If you find this presentation useful, please consider telling others about our site (www.exploreHR.org)www.exploreHR.org 2
  • 3. Comprehensive Model for Diagnosing Organizational Systemswww.exploreHR.org 3
  • 4. What is Diagnosis? • Diagnosis is the process of understanding how the organization is currently functioning, and it provides information necessary to design change interventions. • It is also a collaborative process between organization members and the OD (organization development) consultant to collect pertinent information, analyze it, and draw conclusions for action planning and intervention.www.exploreHR.org 4
  • 6. Comprehensive Model for Diagnosing Organization A. ORGANIZATIONAL LEVEL Inputs Design Components Outputs Strategy - General Structure Culture Organization Environment Effectiveness - Industry Structure Human Technology Resources B. GROUP LEVEL Inputs Design Components Outputs Goal Clarity Team Task Group - Organization Structure Effectiveness Functioning Design e.g., quality of Group Group work life, Composition Norms performance C. INDIVIDUAL LEVEL Inputs Design Components Outputs Skill Variety Individual - Organization Effectiveness Design Task Identity Autonomy e.g., job - Group Design - Personal satisfaction, Characteristics Task Feedback personal Significance about Results developmentwww.exploreHR.org 6
  • 7. Organizational-Level Diagnosiswww.exploreHR.org 7
  • 8. Organizational-Level Diagnosis Inputs Design Components Outputs Strategy General Environment Structure Culture Organization Effectiveness Industry Structure Human Technology Resources Systemswww.exploreHR.org 8
  • 9. General Environment General • The general environment represent the Environment external elements and forces that can affect the attainment of organization objectives. • It can be described in terms of amount of uncertainty present in social, technological, economic, ecological, and political forces.www.exploreHR.org 9
  • 10. Five Forces of Industry Structure Buyer Power Supplier Threats of Power Substitutes Industry Structure Rivalry Threats among of Entry Competitorswww.exploreHR.org 10
  • 11. Strategy Strategy • A strategy represent the way an organization uses its resources to gain and sustain a competitive advantage. • It can be described by the organization’s mission, goals and objectives, strategic intent, and functional policies.www.exploreHR.org 11
  • 12. Strategy Formulation Analysis of General Mission – Environment Why We and Industry Exist Structure Vision – Strategy Map : Strategy : What We Translate the Our Game Want to Be Strategy into Plan Action Values – What’s Analysis of Important Organization’s to Us Core Competencewww.exploreHR.org 12
  • 13. Strategy Formulation Strategic Outcomes Satisfied Shareholders Strategy : Strategy Delighted Our Game Map : Customers Plan Translate Excellent the Strategy Processes Motivated Workforcewww.exploreHR.org 13
  • 14. Structure Structure • The structural system describes how attention and resources are focused on task accomplishment. • It represents the basic organizing mode chosen to (1) divide the overall work of an organization into subunits that can assign task to individuals and groups and (2) coordinate these subunits for completion of the overall work.www.exploreHR.org 14
  • 15. Culture Culture • Organization culture represents the basic assumptions, values, and norms shared by organization members. • It orients employees to company goals and suggests the kinds of behaviors necessary for success.www.exploreHR.org 15
  • 16. Elements of Corporate Culture Formation Organization Top Industry System and Management Characteristics Policy View Profile of Organization Employees Structure Corporate Culturewww.exploreHR.org 16
  • 17. Human Resources Systems Human • Human resources systems include Resources mechanism for selecting, developing, Systems appraising and rewarding organization members. • HR systems influence the mix of skills, personalities and behaviors of organization members.www.exploreHR.org 17
  • 18. Human Resources Systems Recruitment & Selection Training & Performance Business Development Management Business Strategy Result HR Systems Reward Career Management Managementwww.exploreHR.org 18
  • 19. Technology • Technology is concerned with the way Technology an organization converts inputs into products and services. • It represents the core of the transformation function and includes production methods, work flow and equipment.www.exploreHR.org 19
  • 20. Organizational-Level Diagnosis • What is the company’s general environment? • What is the company’s industry structure? • What is the company’s strategy? • What is the company’s culture? • What are the company’s structure, human resources systems, and technology?www.exploreHR.org 20
  • 21. Organizational-Level Diagnosis Inputs Design Components Strategy Does the General Environment organization Structure Culture strategic Industry orientation fit Structure with the inputs? Technology Human Resources Systemswww.exploreHR.org 21
  • 22. Organizational-Level Diagnosis Design Components Strategy Do the design Structure Culture components fit with each other? Human Technology Resources Systemswww.exploreHR.org 22
  • 23. Group-Level Diagnosiswww.exploreHR.org 23
  • 24. Group-Level Diagnosis Inputs Design Components Outputs Goal Clarity Organization Task Group Team Structure Functioning Design Effectiveness Group Group Composition Normswww.exploreHR.org 24
  • 25. Organization Design Organization • Organization design is the major input to Design group design. • It consists of the design components characterizing the larger organization within which the group is embedded : technology, structure, human resources systems and organization culture.www.exploreHR.org 25
  • 26. Group Components Goal Clarity involves how well the group understand its objectives Task Structure is Group Functioning is the concerned with how the underlying basis of group life group’s work is designed Group Composition Group Norms are member concerns the membership of beliefs about how the group groups should perform taskwww.exploreHR.org 26
  • 27. Goal Clarity • Goal Clarity involves how well the group Goal understands its objectives. Clarity • In general, goals should be moderately challenging; there should be a method of measuring, monitoring and feeding back information about goal achievement. • The goals should be clearly understood by all members.www.exploreHR.org 27
  • 28. Task Structure • Task Structure is concerned with how Task the group’s work is designed. Structure • Task structure can vary along two key dimensions : coordination of members’ effort and regulation of their task behavior.www.exploreHR.org 28
  • 29. Group Functioning Group • Group Functioning is the underlying Functioning basis of group life. • How members relate to each other is important in work groups because the quality of relationship can affect task performance.www.exploreHR.org 29
  • 30. Group Composition Group • Group composition concerns the Composition membership of groups. • Members can differ on a number of dimensions having relevance to group behavior. • Demographic variables such as age education, and job experience, can affect how people behave and relate to each other in groups.www.exploreHR.org 30
  • 31. Group Norms Group • Group Norms are member beliefs about Norms how the group should perform task • Norms derive from interaction among members and serve as guides to group behavior.www.exploreHR.org 31
  • 32. Group-Level Diagnosis • How clear are the group’s goals? • What is the group’s task structure? • What is the composition of the group? • What are the group’s performance norm? • What is the nature of team functioning in the group?www.exploreHR.org 32
  • 33. Individual-Level Diagnosiswww.exploreHR.org 33
  • 34. Individual-Level Diagnosis Inputs Design Components Outputs Organization Skill Variety Design Group Design Task Task Individual Identity Significance Effectiveness Personal Characteristics (skill, knowledge Autonomy Feedback attitude)www.exploreHR.org 34
  • 35. Individual-Level Diagnosis Organization • Organization design is concerned with Design the larger organization within which the individual job is the smallest unit. Group • Group design concerns the larger group Design or department containing the individual job. • Like organization design, group design is an essential part of the job context.www.exploreHR.org 35
  • 36. Individual-Level Diagnosis Personal • Personal characteristics of individuals Characteristics occupying jobs include their age, education, experience, and skills and abilities. • Personal characteristics can affect job performance as well as how people react to job designs.www.exploreHR.org 36
  • 37. Individual Jobs Dimensions Skill Variety Task Identity Autonomy Five Key Dimensions Task Significance Feedback About Resultswww.exploreHR.org 37
  • 38. Individual Jobs Dimensions Skill Variety The degree to which the job requires a variety of different activities Task Identity Autonomy The degree to which the job The degree to which a job requires completion of a provides freedom and discretion whole and identifiable piece in scheduling the work and of work determining work methods. Task Significance Feedback About Results The degree to which a job has a The degree to which a job provides significant impact on other employee with direct and clear people’s lives information about the effectiveness of task performancewww.exploreHR.org 38
  • 39. Job Characteristics Model - Hackman/Oldham Core Job Psychological Personal and Dimension States Work Outcomes Skill Variety Experienced Task Identity meaningfulness of Task Significance the wok • High internal work motivation Experienced • High-quality work Autonomy responsibility for performance outcomes of the • High satisfaction work with the work • Low turnover Knowledge of the Feedback actual results of the work activitieswww.exploreHR.org 39
  • 40. Individual-Level Diagnosis • What is the design of the larger organization within which the individual jobs are embedded? • What is the design of the group containing the individual job? • What are the personal characteristics of jobholders?www.exploreHR.org 40
  • 41. Individual-Level Diagnosis • How much skill variety is included in the jobs? • How much task identity do the jobs contain? • How much task significance is involved in the jobs? • How much autonomy is included in the jobs? • How much feedback about results do the jobs contain?www.exploreHR.org 41
  • 42. Designing Effective Interventionwww.exploreHR.org 42
  • 43. Intervention • A set of sequenced planned actions or events intended to help an organization increase its effectiveness. Intervention • Interventions purposely disrupt status quo; they are deliberate attempts to change an organization or subunit toward a different and more effective state.www.exploreHR.org 43
  • 44. Effective Intervention Two Major 1. The extent to which it fits the needs of the organization Criteria to Define an 2. The extent to which it transfer Effective change-management competence to Intervention organization memberswww.exploreHR.org 44
  • 45. Intervention Success Factors Readiness Capability of Key Factors for Change the Change that can affect Agent intervention success Capability Cultural to Change Contextwww.exploreHR.org 45
  • 46. Types of Intervention Human Process Intervention Structural Intervention Types of Intervention Human Resource Management Intervention Strategic Interventionwww.exploreHR.org 46
  • 47. Examples of Human Process Intervention Process This intervention focuses on interpersonal relations and social Consultation dynamics occurring in work groups. Team Building This intervention helps work groups become more effective in accomplishing taskwww.exploreHR.org 47
  • 48. Examples of Structural Intervention Structural Design This change process concerns the organization’s division of labor – how to specialize task performances. Downsizing This intervention reduces costs and bureaucracy by decreasing size of the organization Reengineering This intervention radically redesign the organization’s core work process to create more responsive performance.www.exploreHR.org 48
  • 49. Examples of Human Resources Management Intervention Performance This intervention is a systematic process to link between corporate goal Management settings and reward systems. Career Planning & This intervention helps people choose Development career paths and attain career objectives. Reward System This intervention involves the design of organizational rewards to improve employee satisfaction and performance.www.exploreHR.org 49
  • 50. Examples of Strategic Intervention Merger and This intervention is a systematic process to integrate two or more Acquisition organizations. Cultural Change This intervention helps organizations develop cultures appropriate to their strategies and environment. Organizational This intervention seeks to enhance an Learning organization’s capability to acquire and deploy new knowledge.www.exploreHR.org 50
  • 51. Institutionalizing Interventions Effective Intervention Institutionalization Process Enhance Organization Performancewww.exploreHR.org 51
  • 52. Factors Affecting Institutionalization Process Organization Characteristics: • Congruence • Stability • Unionization Institutionalization Process Intervention Characteristics: • Goal Specifity • Programmability • Level of Change Target • Internal Support • Sponsorshipwww.exploreHR.org 52
  • 53. Organization Characteristics: This is the degree to which an intervention is Congruence perceived as being in harmony with the organization’s strategy, and structure; its current environment; and other changes taking place. Stability of This involves the degree to which the Environment and organization’s environment and technology Technology are changing.www.exploreHR.org 53
  • 54. Organization Characteristics: Diffusion of interventions may be more Unionization difficult in unionized settings, especially if the changes affect unions contract issues, such as salary and fringe benefit, job design, and employee flexibility.www.exploreHR.org 54
  • 55. Intervention Characteristics: This involves the extent to which intervention Goal Specifity goals are specific rather than broad. This involves the degree to which the Programmability changes can be programmed or the extent to which the different intervention characteristics can be specified early in advance to enable socialization, commitment, and reward allocation.www.exploreHR.org 55
  • 56. Intervention Characteristics: This concerns the extent to which the change Level of target is the total organization, rather than a Change Target department or small work group. This refers to the degree to which there is an Internal internal support system to guide the change Support process.www.exploreHR.org 56
  • 57. Intervention Characteristics: This concerns the presence of a powerful Sponsorship sponsor who can initiate, allocate, and legitimize resources for the intervention.www.exploreHR.org 57
  • 58. Recommended Further Readings 1. Thomas Cummings and Christopher Worler, Organization Development and Change, South Western College Publishing 2. Stephen Robbins, Organizational Behavior, Prentice Hall 3. Marvin Ross Weisbor, Organizational Diagnosis : A Workbook of Theory and Practice, Perseus Books Groupwww.exploreHR.org 58
  • 59. End of Materialwww.exploreHR.org 59