Organizational development (OD) is an application of behavioral science to organizational change. It encompasses a wide array of theories, processes, and activities, all of which are oriented toward the goal of improving individual organizations. Generally speaking, however, OD differs from traditional organizational change techniques in that it typically embraces a more holistic approach that is aimed at transforming thought and behavior throughout an entity. Definitions of OD abound, but they are all predicated on the notion of improving organizational performance through proactive activities and techniques. It is also worth noting that organizational development, though concerned with improving workforce performance, should not be mistaken for human resource development. "Organization development is the planned process of developing an organization to be more effective in accomplishing its desired goals," wrote Rima Shaffer in Principles of Organization Development. "It is distinguished from human resource development in that HRD focuses on the personal growth of individuals within organizations, while OD focuses on developing the structures, systems, and processes within the organization to improve organizational effectiveness."
ORGANIZATIONAL DEVELOPMENT BASICS
Although the field of OD is broad, it can be differentiated from other systems of organizational change by its emphasis on process rather than problems. Indeed, traditional group change systems have focused on identifying problems in an organization and then trying to alter the behavior that creates the problem. But Margaret Neale and Gregory Northcraft observed in Organizational Behavior: A Management Challenge that OD initiatives focus on identifying the behavioral interactions and patterns that cause and sustain problems. Then, rather than simply changing isolated behaviors, OD efforts are aimed at creating a behaviorally healthy organization that will naturally anticipate and prevent (or quickly solve) problems.
OD programs usually share several basic characteristics. For instance, they are considered long-term efforts of at least one to three years in most cases. In addition, OD stresses collaborative management, whereby managers and employees at different levels of the hierarchy cooperate to solve problems. OD also recognizes that every organization is unique and that the same solutions cannot necessarily be applied at different companies—this assumption is reflected in an OD focus on research and feedback. Another common trait of OD programs is an emphasis on the value of teamwork and small groups. In fact, most OD systems use small teams—or even individuals—as a vehicle to implement broad organizational changes.
The catalyst—whether a group or individual—that facilitates the OD process is known as the "change agent." Change agents are often outside consultants with experience managing OD programs, although companies sometimes utilize inside managers. The advantage of bringing in outside OD consultants is that they often provide a different perspective and have a less biased view of the organization's problems and needs. The primary drawback associated with outside change agents is that they may lack an in-depth understanding of key issues particular to the company. In addition, outside change agents may have trouble securing the trust and cooperation of key players in the organization. For these reasons, some companies employ an external-internal team approach, which seeks to combine the advantages of internal and external change agents while minimizing the drawbacks associated with the two approaches. "Are change agents necessary for organizational development to take place?" queried Gibson, Ivancevich, and Donnelly, authors of Organizations: Behavior, Structure, Processes. "Once we recognize that organizational development involves substantial changes in how individuals think, believe, and act, we can appreciate the necessity of someone to play the role of change agent. But who should play the role? Existing managers? New managers? Or individuals hired specifically for that purpose? Depending upon the situation, any of these can be called upon to orchestrate the organizational development process. The point is that the role of the change agent is necessary for organizational development to occur."
MANAGING CHANGE THROUGH ORGANIZATIONAL DEVELOPMENT
Organization development initiatives do not automatically succeed. The benefits of effective OD programs are myriad, as many executives, managers, and business owners will attest. But OD interventions that are pursued in a sloppy, half-hearted, or otherwise faulty manner are far less likely to bring about meaningful change than those that have the full support of the people involved. Writing in the Academy of Management OD Newsletter, consultant William G. Dyer stipulated several conditions that had to be present if an OD intervention could have any meaningful chance of bringing about the desired change:
* Ownership and all involved personnel needed to be genuinely and visibly committed to the effort.
* People involved in OD have to be informed in advance of the nature of the intervention and the nature of their involvement in it.
* The OD effort has to be connected to other parts of the organization; this is especially true of such areas as the evaluation and reward systems.
* The effort has to be directed by appropriate managers and guided by change agents (which, if used, must be competent).
* The intervention should be based on accurate diagnosis of organizational conditions.
* Owners and managers should show their commitment to OD at all stages of the effort, including the diagnosis, implementation, and evaluation.
* Evaluation is key to success, and should consist of more than asking people how they felt about the effort.
* Owners and managers need to show employees how the OD effort relates to the organization's goals and overriding mission.
IMPLEMENTING OD PROGRAMS
OD efforts basically entail two groups of activities: "action research" and "interventions." Action research is a process of systematically collecting data on a specific organization, feeding it back for action planning, and evaluating results by collecting and reflecting on more data. Data gathering techniques include everything from surveys and questionnaires to interviews, collages, drawings, and tests. The data is often evaluated and interpreted using advanced statistical analysis techniques.
Action research can be thought of as the diagnostic component of the OD process. But it also encompasses the intervention component, whereby the change agent uses action plans to intervene in the organization and make changes, as discussed below. In a continuous process, the results of actions are measured and evaluated and new action plans are devised to effect new changes. Thus, the intervention process can be considered a facet of action research.
OD interventions are plans or programs comprised of specific activities designed to effect change in some facet of an organization. Numerous interventions have been developed over the years to address different problems or create various results. However, they all are geared toward the goal of improving the entire organization through change. In general, organizations that wish to achieve a high degree of organizational change will employ a full range of interventions, including those designed to transform individual and group behavior and attitudes. Entities attempting smaller changes will stop short of those goals, applying interventions targeted primarily toward operating policies, management structures, worker skills, and personnel policies. Typically, organization development programs will simultaneously integrate more than one of these interventions. A few of the more popular interventions are briefly described below.
INTERPERSONAL INTERVENTIONS Interpersonal interventions in an OD program are designed to enhance individual skills, knowledge, and effectiveness. This type of program utilizes group dynamics by gathering individuals together in loosely structured meetings. Subject matter is determined by the group, within the context of basic goals stipulated by a facilitator. As group members try to exert structure on fellow members, group members gain a greater awareness of their own and other's feelings, motivations, and behaviors. Other types of interpersonal interventions include those designed to improve the performance review process, create better training programs, help workers identify their true wants and set complementary career goals, and resolve conflict.
GROUP INTERVENTIONS OD group interventions are designed to help teams and groups within organizations become more effective. Such interventions usually assume that the most effective groups communicate well, facilitate a healthy balance between both personal and group needs, and function by consensus as opposed to autocracy or majority rule.
Group diagnostic interventions are simply meetings wherein members of a team analyze their unit's performance, ask questions about what the team needs to do to improve, and discuss potential solutions to problems. The benefit of such interventions is that members often communicate problems of which their co-workers were unaware. Ideally, such communication will spur problem-solving and improved group dynamics.
Role analysis technique (RAT) is used to help employees get a better grasp on their role in an organization. In the first step of a RAT intervention, people define their perception of their role and contribution to the overall company effort in front of a group of coworkers. Group members then provide feedback to more clearly define the role. In the second phase, the individual and the group examine ways in which the employee relies on others in the company, and how they define his or her expectations. RAT interventions help people to reduce role confusion, which can result in either conflict or the perception that some people are not doing their job. A popular intervention similar to RAT is responsibility charting, which utilizes a matrix system to assign decision and task responsibilities.
INTERGROUP INTERVENTIONS Intergroup interventions are integrated into OD programs to facilitate cooperation and efficiency between different groups within an organization. For instance, departmental interaction often deteriorates in larger organizations as different units battle for limited resources or become detached from the needs of other units.
Conflict resolution meetings are one common intergroup intervention. First, different group leaders are brought together to secure their commitment to the intervention. Next, the teams meet separately to make a list of their feelings about the other group(s). Then the groups meet and share their lists. Finally, the teams meet to discuss the problems and to try to develop solutions that will help both parties. This type of intervention, say supporters, helps to gradually diffuse tension between groups that has arisen because of faulty communication.
Rotating membership interventions are used by OD change agents to minimize the negative effects of intergroup rivalry that arise from employee allegiances to groups or divisions. The intervention basically entails temporarily putting group members into their rival groups. As more people interact in the different groups, greater understanding results.
OD joint activity interventions serve the same basic function as the rotating membership approach, but these involve melding members of different groups to work together toward a common goal. Similarly, common enemy interventions achieve the same results by finding an adversary common to two or more groups and then getting members of the groups to work together to overcome the threat. Examples of common enemies targeted in such programs include competitors, government regulation, and economic conditions.
COMPREHENSIVE INTERVENTIONS OD comprehensive interventions are used to directly create change throughout an entire organization, rather than focusing on organizational change through subgroup interventions. One of the most popular comprehensive interventions is survey feedback. This technique basically entails surveying employee attitudes at all levels of the company and then disseminating a report that details those findings. The employees then use the data in feedback sessions to create solutions to perceived problems. A number of questionnaires developed specifically for such interventions have been developed.
Structural change interventions are used by OD change agents to implement organizational alterations related to departmentalization, management hierarchy, work policies, compensation and benefit incentives programs, and other cornerstones of the business. Often, the implemented changes emanate from feedback from other interventions. One benefit of change interventions is that companies can often realize an immediate and very significant impact in productivity and profitability (provided the changes are warranted and implemented appropriately).
Sociotechnical system design interventions are similar to structural change techniques, but they typically emphasize the reorganization of work teams. The basic goal is to create independent groups throughout the company that supervise themselves. This administration may include such aspects as monitoring quality or disciplining team members. The theoretic benefit of sociotechnical system design interventions is that worker and group productivity and quality is increased because workers have more control over (and subsequent satisfaction from) the process in which they participate.
A fourth OD intervention that became extremely popular during the 1980s and early 1990s is total quality management (TQM). TQM interventions utilize established quality techniques and programs that emphasize quality processes, rather than achieving quality by inspecting products and services after processes have been completed. The important concept of continuous improvement embodied by TQM has carried over into other OD interventions.