What is Organizational Development?
Organizational Development is the process we use to change attitudes, values and beliefs within the workforce so that employees can drive business results. A successful plan for organizational development typically leads to improved efficiency and higher levels of employee engagement.
How is Organizational Development different from Human Resources?
Generally, Human Resources encompasses the management of the employment life cycle such as recruiting and hiring, performance management, and of course all compliance activities. Human Resources management tends to be focused on maintaining the status quo within the organization.
On the other hand, Organization Development is focused setting the strategy, mission, and vision for the organization and defining the activities required to achieve those. As such, Organizational Development tends to be focused on activities that will change the status quo and drive the business forward.
What is the role of Organizational Development?
A good Organizational Development professional knows that once the company strategy is set it is time to conduct a gap analysis to determine the company’s current culture and climate compared to where it wants to go. Oftentimes the analysis show deficiencies in leadership training and development, employee engagement, teamwork, and employment brand. The Organizational Development professional’s role is to implement processes to drive change in those areas.
Climate and culture are two different things, though they are often used interchangeably. Climate is an employee’s perception of the work environment and is greatly influenced by the frontline managers and supervisors. Ultimately if employees feel supported by their manager, they are more motivated, and the workplace climate is viewed positively.
Culture however is determined by a company’s identity. What values does it share? What behavioral norms are expected? Every company has a culture, whether it has been formally identified or not. I believe the culture, more than any other thing, impacts a company’s employment brand and its ability to attract and retain talent.
Why is Organizational Development Important?
Failing to develop our company is the first step in a declining corporate life cycle. Just as we need to invest in new equipment and infrastructure to service customers, we must invest in the strength of the company and its people to better service customers. We’ve often heard the saying “People don’t quit companies, they quit bosses.” If this is happening in your workplace, it is a sure sign that basic organizational development principles are being ignored.
What are Common Organizational Culture Problems?
Culture can be summed up as “the way we do things around here.” One of the biggest problems in a company’s culture is if the way things are done is “always the way we’ve done things.” Today’s employees are too savvy and motivated to adhere to that phrase. They want to work with an organization that thrives on new ideas and approaches to solving today’s business challenges.
Another culture pitfall is allowing a heavy-handed management style to permeate the organization. Managers that sit in the “ivory tower” and call the shots from above do not drive engagement and buy-in from their employees. This leads to demotivation and high turnover.
We also know that healthy employee relations equals a healthy bottom line. Failing to focus on this key aspect leads to decreased productivity, increased absenteeism and workplace conflict, and ultimately dissatisfied customers.
A well-defined organizational strategy ensures that our business supports our mission, goals, and objectives. There are three common business strategies upon which we can build our culture:
Operational Excellence is primarily a price/cost-based strategy. It often includes a combination or price, quality, dependability and ease of purchase that competitors cannot match. The corporate culture strives to minimize waste and reward efficiency. Think UPS, FedEx or Walmart.
Product/Service Leadership is primarily an innovation-based strategy. It focuses on innovation, product development, and market exploitation. The corporate culture encourages imagination, and a mindset driven by the prospect of creating the future. Think Apple, Big Pharma, or any luxury car company.
Customer Intimacy is primarily a solutions-based strategy. It focuses on creating results for carefully selected customers and making them successful. The corporate culture encourages deep and lasting relationships with customers. Think Nordstrom or Starbucks.
Defining your business strategy allows us to determine the business objectives we will focus on. These objectives become the link between strategy and the specific actions or behaviors employees must take.
What are the Stages of Organizational Development?
The first step to building a solid workplace culture is to diagnose the problem areas in which improvement is needed. Common objectives in the diagnosis phase are to look for ways to increase organizational efficiency, improve employee motivation, or to increase trust and teamwork throughout the organization.
Next we must develop solutions to the identified problems. What are the most effective and efficient ways to the address the problems? Who should lead the initiatives? Do we need assistance from an outside third party?
Usually, small “dry runs” are the best ways to implement the change initiatives. That helps us find any hidden issues not previously discovered. We cannot expect change to happen quickly, especially in larger organizations, so careful planning is required to manage the change initiative.
Approximately 70% of all change management initiatives fail, typically due to poor plans or improper implementation. Our evaluation of the new processes and systems must be regular and ongoing if we expect the change to “stick.” When evaluating our systems, we need to determine if communication is clear, expectations are understood, and outcomes are measurable.
How Have I Helped Organizations?
Organizations across all industries have asked me to assist them with identifying opportunities for efficiency, increased productivity and standardization of practices, policies, and procedures, with the goal being to identify opportunities for improvement and implementing the needed changes.
We often identify and implement process that result in improved operations, direct time and cost savings, and training programs that provide employees with the skill to be successful.
I usually start with a comprehensive review of the organization’s current structure, staffing model, strategic plan, processes and workflows. Next I schedule on-sire focus groups and one-on-one interviews to get a real sense of employee engagement and underlying issues. From there we work together on the change management plan. This has resulted in initiatives such as: succession planning, leadership development, workflow redesign, organization/departmental restructuring, executive coaching, and modifying pay structures to reward performance. The outcome of those initiatives? Increased efficiency and morale, improved performance and customer service, and cost savings are all common results when clients work with me.