Looking to delve into the topic of Organizational Development and discover ways to transform your company’s culture into its most valuable asset? Keep reading until the end.
Here, we will discuss:
Organizational Development Definition
Organization Development is a science-based process that helps organizations enhance their capacity for change and achieve effectiveness by developing, improving and supporting strategies, plans and processes.
The Objectives of Organizational Development
Organizational Development objectives vary across organizations. For businesses, increasing profits is likely to be a concern. In contexts social values hold importance.
Moreover, in healthcare services adaptability plays a role in maintaining functioning.
If we were to identify one objective it would be to enhance the organization’s competitiveness.
Competitiveness refers to the idea that every organization possesses resources and capabilities that enable them to succeed in the marketplace.
These can include individuals (such as visionary business leaders like Elon Musk or teams like Google) innovative products (like SpaceX) exceptional service (such as Four Seasons Hotels) or even organizational culture (like Zappos).
It also involves how responsive an organization is to changing market demands.
If you are quick to take advantage of an opportunity such as this one, it could solidify your earnings, over the five years. The aim of organizational development is to cultivate these viewpoints as they can help a business succeed in the market.
This means that OD differs from the change process. Organizational development focuses on enhancing the organizations’ ability to assess its functioning and adjust achieve its goals. It is a process, unlike change processes that are often temporary.
5 Important Elements for Organizational Development
Now that we have an understanding of why the OD model exists, let’s explore what makes it successful. The core principles are given below. Organizational development works towards progress by doing the following:
- Making changes in aspects of any given job up to the organization
- Applying methods to transform an organization from within
- Involving people from the organization in key processes
- Promoting core values that contribute real life examples to an organizations mission
- Establishing and adapting to changes in a flexible and participatory manner
It essentially involves more stakeholders getting more people involved in the process so both the process and outcome are ultimately shaped by those same stakeholders.
Overall, it is a sense of accountability throughout the organization and an approach to it that helps develop the organization as an entity (then fragmented parts).
The four components of Organizational Development are as follows:
- Representatives:
This initiative aims to improve employee relationships and dynamics. Typical interventions include one on one coaching for employees facing communication challenges, group activities to foster camaraderie or targeted conflict resolution to address issues and find solutions.
- Innovation/Design:
Sometimes referred to as “Technostructural Interventions ” these changes focus on improving an organization’s technology or reporting structure.
An organization may restructure its framework making it more streamlined for enhanced communication or implementing a hierarchy for reporting.
Other interventions could include process improvements like Lean or Six Sigma. Adopting work designs such as rotation, specialization, expansion or enhancement approaches.
- HRM:
Also known as “Human Resource Management,” these changes aim to enhance how the company manages its employees.
They involve assessing and improving how HR perceives and rewards employees investing in career development opportunities and refining performance evaluation processes.
Interventions might involve creating strategies to increase diversity, allocating resources towards employee mental health and wellbeing or enhancing talent development practices.
- Strategy:
These changes bring about enhancements to the organization’s purpose, offerings or mission.
This category encompasses shifts in the company’s culture and operations—for example transitioning from an office setup to a fully remote distributed workplace.
Netflix and Amazon have undergone changes over the years. For example, Netflix shifted from video rentals to streaming while Amazon transformed from being a bookstore, to becoming a marketplace.
How Human Resources relate to Organizational Development
It’s clear that there are organizational development interventions that involve engaging HR capabilities. Practices such as performance management, goal setting, evaluation and talent management play a role in achieving OD initiatives.
However even though HRM primarily focuses on people practices, organizational development uses an approach. OD utilizes tools such as design, individual and group interventions work plans and more traditional people focused interventions to operate at all levels of the organization.
Be it organizational, group or individual.
However, the emphasis is mainly on topics whereas HRM tends to be more functional in nature.
External strategy consultants also frequently employ OD techniques in their change management programs. Both HRM and OD have their roots in business processes.
The mission, values and vision of an organization.
They both shape the actions needed to implement that strategy within their domains. Moreover, many early initiatives in people’s research originate from the field of organizational development.
Final Thoughts
Organizational development is crucial as it helps organizations transition into a stage of change. Change brings forth ideas and ways of doing things while ensuring that an entity remains innovative and productive.
FAQs
What is the main objective of Organizational Development?
Answer: The main objective of OD is to improve the association’s capacity to manage its external operations and relationships.
How does organizational development differ from management approaches?
Answer: OD sets itself apart from methods by adopting an approach that focuses on making a meaningful impact on how employees behave and perceive the organization.
What will happen to a company if it lacks organizational development?
Answer: The consequences would include reduced productivity. Whether you consider it as time wasted on tasks or simply a lack of efficiency the absence of corporate design leads to lower profitability.
How does organizational culture relate to organizational development?
Answer: Development focuses on improving the effectiveness of a company through strategies, metrics, processes and people. On the other hand, culture encompasses the values and behaviors that shape the social and psychological atmosphere within a business.