Organization development


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Organization development

  1. 1. DEFINITION Organization Development is a top management supported, long-range effort to improve an organization’s problem-solving and renewal processes, particularly through a more effective and collaborative diagnosis and management of organization culture – with special emphasis on formal work team, temporary work team and intergroup culture – with the assistance of a consultant-facilitator and the use of the theory and technology of applied behavioural science, including action research.
  2. 2. DEFINITION Another definition of Organization Development is that it is a systematic application and transfer of behavioural science knowledge to the planned development, improvement and reinforcement of the strategies, structures, and processes that lead to organization effectiveness.
  3. 3. FEATURES OF OD 1. It applies to changes in strategy, structure, and/or processes of an entire system of an organization, a single plant, a department or work group or an individual role or job. 2. It is based on the application and transfer of behavioural science knowledge and practices, such as leadersip, group dynamics, work design. 3. It is concerned with managing planned change, it is more adaptive approach. The planned change can be modified and redesigned if necessary.
  4. 4. FEATURES OF OD 4. It involves both creation and reinforcement of change. It goes beyond initial stage till stabilizing new activities. 5. It is oriented to improving organizational effectiveness – effective organization is able to solve its own problems and focuses on achieving key goals.
  5. 5. RELEVANCE OF 0D 3 major trends are shaping the changes in organizations: 1. Globalization – changing markets and environment and the way they function. 2. Information Technology – has changed the traditional way of doing business, how work is performed, how knowledge is used, etc. 3. Managerial Innovation – new organizational forms, such as networks, strategic alliances, large corporations, etc. are leading to new methods of manufacturing goods and providing services.
  6. 6. WHAT OD CAN DO Helps in bringing change in organization Helps organizations to assess themselves and their environment and build their strategies, structures and processes. Helps in changing the assumptions and values in their behaviour. Helps in making organizations more responsive to the needs of operating in highly complex and changing world. Helps managers and staff to perform their tasks more effectively. It can provide skills and knowledge necessary for effective relations.
  7. 7. PLANNED CHANGE Definition of Change: Change means the new state of things is different from the old state of things. Change should be viewed as an understandable process that can be managed instead of as a mysterious event. Planned Change: Focuses on how change can be implemented in organizations.
  8. 8. THEORIES OF PLANNED CHANGE 1. Kurt Lewin’ Change Model First stage – Unfreezing Second stage – Moving Third stage - Refreezing
  9. 9. THEORIES OF PLANNED CHANGE 2. Action Research Model a. Problem identification b. Consultation with behavioural science experts c. Data gathering and preliminary diagnosis d. Feedback to a key client e. Joint diagnosis of the problem (with the management by OD expert) f. Joint action planning g. Data gathering after action
  10. 10. THEORIES OF PLANNED CHANGE 3. The Positive Model – focuses on “what the organization is doing right” and not problems. a. Initiate the inquiry b. Inquire into best practices of the organization and get details of the same c. Discover the themes – based on stories of people, i.e., how managers managed d. Envision a preferred future – employees identify themes and change status quo e. Design and deliver – design & deliver ways to create future – describe activities and create plans to bring about the vision.
  11. 11. THEORIES OF PLANNED CHANGE 4. General Model of Planned Change a. Entering & contracting – with OD expert with the organization. b. Diagnosing issues– at organization level, group level and individual level (Gathering, analysing and feeding back data are the central change activities in diagnosis) c. Planning & Implementing change – to be carried out jointly by the OD expert and the organization. d. Evaluating and institutionalizing change – providing feedback and evaluating the effects of change, and make it regular feature which should continue
  12. 12. PROCESS OF OD DIAGNOSTIC PROCESS It is the process of understanding how the organisation is currently functioning, and it provides the information necessary to design change interventions. It is a collaborative process between organization members and the OD consultant to collect pertinent information, analyse it, draw conclusions for action planning and intervention.
  13. 13. DIAGNOSTIC MODELS Open System Model a. Open systems exchange information and resources with their environment b. Open systems display a hierarchical order. Each higher level of system comprises lower level system – society, organizations, groups (departments) and individual level c. The systems at different levels are different in many ways – in size and complexity. d. The common inputs of all systems are – inputs, transformation, output, boundaries, feedback, equifinality, and alignment .
  14. 14. Open System Model 1. Inputs – human or other resources, such as information, energy, materials, etc. 2. Transformation – processes of converting inputs into outputs. 3. Output – transformed input into output 4. Boundaries – to distinguish between systems and environment 5. Feedback – information about the actual performance. 6. Equifinality –not necessary to have same cause and effect relation in open systems 7. Alignment – perfect fit between inputs, transformation and out and among sub-systems.
  15. 15. SOCIETY LEVEL SYSTEM DIAGNOSIS The Open system approach is applied to diagnose to point out what areas to examine and what questions to ask to assess functioning of the society/organization/group/individual. Diagnosis can occur at all levels or may be limited to issues occurring at a particular level.OPEN SYSTEM APPROACH TO THE SOCIETY1. Environment - external2. Input – Information & energy from the environment of the society3. Transformation – technological components and social components4. Output – finished goods, services and ideas given back to the environment of the society.5. Feedback – future improvements.
  16. 16. DIAGNOSING ORGANIZATIONALSYSTEMS Open system can help in diagnosing at the organizational level as under: I. Inputs – (i) General Environment – social, technological, economic, ecological, political (ii) Industry Structure or Task Environment – supplier power, buyer power, threats of substitutes, threat of entry new companies, rivalry among competitors.Note: Dynamic environments change rapidly and are unpredictable, strategy should be flexible, keeping in view the Industry Structure.
  17. 17. DIAGNOSING ORGANIZATIONALSYSTEMS II. Design Components (Transformation) – which converts inputs into outputs. There are 5 major design components : 1. Strategy – the way an organization uses its resources to achieve its goals. 2. Technology – the way an organization converts inputs into products/services – methods of production, equipment, etc. 3. Structure – how to (i) divide the work, (ii) how to coordinate the divided work to coordinate 4. Measurement Systems – data for control 5. Human Resource Systems – mechanism for selecting, developing, appraising and rewarding Note: Organization Culture guides members’ perceptions, thoughts and actions in regard to the above design components.
  18. 18. DIAGNOSING ORGANIZATIONALSYSTEMS III. Outputs – (i) Organizational performance – financial – profits, sales, ROI (ii) Productivity – sales per employee, waste, error rates, quality or units produced (iii) Stakeholders – customer satisfaction, employee satisfaction, investor satisfaction. IV. Alignment – a. does the organization’s strategic orientation fit with the inputs? (b) do the design components fit with each other
  19. 19. DIAGNOSING ORGANIZATIONALSYSTEMS ANALYSIS WITH THE HELP OF ORGANIZATIONAL SYSTEM 1st step – is the organization performing well 2nd Step – understand causes by assessing inputs and strategic orientation 3rd Step – evaluate alignments among different parts. NOTE: how well the – Inputs, Design Components, Outputs - fit together, will determine the performance of the organization
  20. 20. DIAGNOSING GROUP LEVELSYSTEMS I. Inputs: Organization Design is the major input to Group Design Level. Group Design is conditioned by technology, structure, measurement systems, and human resource system and organization culture. II. Design Components (transformation) are a. goal clarity – understanding of group goals b. Task Structure – how work is divided c. Group Composition – age, education, experience, skills, abilities. d. Team Functioning – quality relationship in group e. Performance – performance norms – how work is to be performed and standards of performance
  21. 21. DIAGNOSING GROUP LEVELSYSTEMS III. Outputs: Group effectiveness – (a) Performance – group’s ability to control or reduce costs, increase productivity or improve quality (b) Quality of Work Life – effectiveness is also indicated by the group members’ quality of work life. IV. Fits – Group Design components must fit inputs if groups are to be effective. Basis of diagnosis of group’s design components a. how clear are group’s goals, b. what is group’s task structure, c. what is the composition of group, d. what is group’s performance norms, e. what is nature of team functioning (quality of work life)
  22. 22. INDIVIDUAL JOB/POSITION LEVELDIAGNOSIS I. Inputs: (a) Organization Design of the organization in which the individual job is the smallest unit – technology, structure, measurement systems, human resource systems and culture have powerful impact on the ways jobs are designed and on people’s experiences in jobs. (b) Group Design is an essential part of the job context – group task structure, goal clarity, composition, performance norms, and group functioning serve as inputs to job design. These have direct impact on job. (c ) Personal Characteristics of the individuals occupying jobs – age, education, experience, skills and abilities. All these can affect job performance and how people react to job.
  23. 23. INDIVIDUAL JOB/POSITION LEVELDIAGNOSIS II. Design Components: Individual jobs have 5 key dimensions: a. Skill variety – identifies the degree to which a job requires a range of activities and abilities to perform the work. b. Task Identity – degree to which a job requires completion of a relatively whole piece of work. c. Task Significance – job has a significant impact on other people’s lives. d. Autonomy – freedom in scheduling work and determining work methods. e. Feedback – provides direct and clear information about the effectiveness of task performance.The above 5 Dimensions put together lead to job enrichment – enriched jobs motivate and satisfy employees.
  24. 24. INDIVIDUAL JOB/POSITION LEVELDIAGNOSIS III. Output – completion of task as per performance standards. IV. Fits – i. Job design to be congruent with organization and group design. ii. Job design to fit personal characteristics of job holders, if they are to perform effectively and derive satisfaction. Diagnosis of Individual Level inputs – i. what is the design of the larger organization within which the individual jobs are embedded ii. What is the design of the group containing the individual jobs. iii. What are the personal characteristics of job holders
  25. 25. COLLECTING AND ANALYSINGDIAGNOSTIC INFORMATION OD is dependent on diagnosis. Diagnosis is carried out by collecting information pertaining to assessing the functioning of organization. Based on diagnosis, the intervention to be used to bring about change, is decided. The process consists of: 1. establish relationship with OD practitioner by the client and establish relationship between OD practitioner and those from whom data is to be collected. 2. Methods of Data Collection – questionnaire, interviews, observation and unobtrusive measures 3. Analyse the information to make clear causes of organization problems and to identify areas for future development. 4. Provide feedback to the client 5. Follow up
  26. 26. COLLECTING AND ANALYSINGDIAGNOSTIC INFORMATION What OD Practitioner should do before collecting information? a. introduce himself b. State the purpose – what he will do c. For whom he works – establish rapport with those who would provide the data d. Confidentiality to be maintained by OD practitioner e. Explain how the data provider will be benefitted f. OD practitioner should be trusted.
  27. 27. DESIGNING INTERVENTIONS Interventions are planned actions or events or tools to bring about desired improvement in the organization. What is an effective Intervention? Following is criteria to define effective Intervention: 1. Fitment – fitment is based on valid/accurate diagnosis of the organization. Employees to be involved in making decisions about changes which will affect them. Employees should accept and take responsibility for its implementation 2. Knowledge of Outcome – clear relation between the intervention and outcome may not be there but some evidence should be there.
  28. 28. DESIGNING INTERVENTIONS 3. Organization’s capacity to manage change – employees should be able to management the change themselves, ultimately. 4. Result Driven – to what extent intervention will achieve the goal 5. Cost benefit analysis 6. Acceptability by the client organisation 7. Shared ownership – is it explained and communicated to all.
  29. 29. HOW TO DESIGN EFFECTIVEINTERVENTION Designing of effective interventions depend : A. Conditions prevailing in the organization that can affect success of intervention – (1) politics, management style, structure, top management support. (2) Capability of the OD Expert (3) Readiness for change – pressure for change, dissatisfaction with status quo, availability of resources and commitment of time. (4) Capability to change – knowledge & skills to motivate for change (5) Cultural context – modify intervention to fit the culture
  30. 30. HOW TO DESIGN EFFECTIVEINTERVENTION B. Targets of Change – 1. Organizational Issues – i. strategic issues (most crucial), ii. Technology & structures issues, iii. Human resource issues – attracting competent people, setting goals for them, rewarding, iv. Human process issues – communication, leadership, decision making. 2. Organizational Levels – organizations function at different levels – individual, group, organization and transorganization. Interventions should be level specific and try to integrate interventions affecting different levels to be successful.
  31. 31. CATEGORIZATION OFINTERVENTIONS 1. Human Process Interventions – coaching, Training & Development, consultations, third party intervention, team building. 2. Technostructural Interventions – structural design, downsizing, re-engineering 3. Human Resource Management Interventions – goal setting, Performance appraisal, reward system, career planning 4. Strategic Interventions – strategic change, mergers & acquisitions, alliances, networks, culture change, organization learning and knowledge management
  32. 32. INDIVIDUAL, & INTERPERSONALLEVELS INTERVENTIONS Individual Level Interventions to improve skills, knowledge and capabilities of employees: a. Coaching b. Training and development Coaching – involves guided inquiry, active listening, reframing and other techniques to help individuals see new or different possibilities and to direct their efforts towards what matters most to them. It assists an executive to change and make him improve productivity and effective.
  33. 33. INDIVIDUAL, & INTERPERSONALLEVELS INTERVENTIONS A. The Process of Coaching: 1. Establish the principles of relationship – establish goals of coaching and decide parameters such as resources, compensation and ethical considerations. 2. Conduct an Assessment by administering psychological tests or use 360 degree feedback process. 3. Debrief the results - feedback to enable client to take action 4. Develop an action plan – new actions by client and coach for goal achievement. 5. Implement the action plan through one-to-one meetings. It requires skills to confront, challenge and facilitate learning. 6. Assess the results – action of client are reviewed and evaluated. Based on this, action plan can be revised or process can be terminated.
  34. 34. INDIVIDUAL, & INTERPERSONALLEVELS INTERVENTIONS B. Training and development: 1. Identify Training and development needs through performance appraisal. 2. Develop the objectives of the Training and development Programme 3. Design the Training and Development Programme – contents, methods, trainer 4. Deliver the training and development programme by organizing it at suitable date and place. 5. Evaluate the effectiveness of training and development programme
  35. 35. INDIVIDUAL, & INTERPERSONALLEVELS INTERVENTIONS The Interpersonal Level Interventions: 1. Process Consultation – to carry out helping relationship for managers, employees in areas of communication, interpersonal relations, decision-making and task performance. Principles of Process consultation: 1. be helpful, 2. be in touch with client’s beliefs, emotions, reactions, 3. to act as agent of change, 4. help client to solve own problem, 5. understand client’s motivation and perceptions, 6. timing is crucial when client is ready to receive suggestion, 7. when consultant in doubt share the problem with client.
  36. 36. INDIVIDUAL, & INTERPERSONALLEVELS INTERVENTIONS Problems in Process Consultation – a. in most cases field studies did not directly measure the effect of process consultation as compared with other methods. b. most studies have used people’s perception and not measured success scientifically. 2. Basic Process Intervention – Johari Window – to make people more effective in their communication with others by increasing the individual’s awareness of how their behaviour affects others
  37. 37. GROUP LEVEL INTERVENTIONS The Group Level Interventions are aimed at: a. Process Interventions – to sensitize the group to its own internal processes b. Content Interventions – help the group to determine what it works on c. Structure Interventions – examine methods used to accomplish tasks and deal with external issues. These interventions are carried out by OD expert by making comments, raising questions and observations.
  38. 38. GROUP LEVEL INTERVENTIONS 2. Third Party Interventions focuses on conflicts arising between two or more people within the organization. Conflict can arise due to a. personality, 2. task orientation, 3. goal interdependence, 4. perception among group members. At times issues underlying a conflict are latent and are not manifested. Then something triggers the conflict and brings it into open. Then scared of the consequences of open conflict it becomes latent again and again gets triggers. Strategies to Handle conflict – help to prevent triggering by understanding factors which can trigger – by warning, lay down rules under which the parties can interact, use of consultants who would help in giving vent to their grievances, developing emotional support, attempt to eliminate or resolve the basic issues causing conflict, at times it may be difficult.
  39. 39. GROUP LEVEL INTERVENTIONS Third party interventions help the parties interact with each other directly to diagnose causes of conflict and its resolution. Consultants help employees resolve interpersonal conflicts which arise during team building or process consultation. 3. Team Building – Planned activities that help groups to improve the way they accomplish tasks, enhance their interpersonal and problem solving skills. Team building activities – diagnostic tools – instruments, interview and feedback to understand motivation of group, surveys and team meetings. Development tools – coaching, 360 degree feedback, third party intervention, role clarification, mission and goal development, strategic planning and outdoor games.