Organization development strategy
Organization development strategy is founded on the aspiration to improve organizational capability, which is broadly the capacity of an organization to function effectively in order to achieve desired results. It has been defined more specifically by Ulrich and Lake (1990: 40) as ‘the ability to manage people for competitive advantage’. It is concerned with mapping out intentions on how the work system should be developed in line with the concept of smart working, on how the organization should be structured to meet new demands, on system-wide change in fields such as reward and performance management, on how change should be managed, on what needs to be done to improve organizationalprocesses involving people such as teamwork, communications and participation, and how the organization can acquire, retain, develop and engage the talent it needs. These intentions will be converted into actions on work systems development, structure design, the redesign of jobs and, possibly, OD-type interventions. The latter could take the form of action research, survey feedback and programmes for improving group processes and interpersonal skills, as described earlier in this chapter. The strategy can involve processes of integrated strategic change, as described below, and will be based on organizational diagnosis leading to the design of an organization development programme, as considered in the following sections.
Integrated strategic change
The process of integrated strategic change as conceived by Worley et al (1996) can be used to formulate and implement organization development strategies. The steps required are:
- Strategic analysis, a review of the organization’s strategic orientation (its strategic intentions within its competitive environment) and a diagnosis of the organization’s readiness for change.
- Develop strategic capability – the ability to implement the strategic plan quickly and effectively.
- Integrate individuals and groups throughout the organization into the processes of analysis, planning and implementation to maintain the firm’s strategic focus, direct attention and resources to the organization’s key competencies, improve coordination and integration within the organization and create higher levels of shared ownership and commitment.
- Create the strategy, gain commitment and support for it and plan its implementation.
- Implement the strategic change plan, drawing on knowledge of motivation, group dynamics and change processes, dealing with issues such as alignment, adaptability, teamwork and organizational and individual learning.
- Allocate resources, provide feedback and solve problems as they arise.
The practice of organization development is based on an analysis and diagnosis of the circumstances of the organization, the strategic, operational or process issues that are affecting the organization and its ability to perform well. As defined by Manzini (1988: ix): ‘An organizational diagnosis is a systematic process of gathering data about a business organization – its problems, challenges, strengths and limitations – and analysing how such factors influence its ability to interact effectively and profitably with its business environment.’ This involves the use of the diagnostic cycle with associated analytical and diagnostic tools, which enable those concerned with development to identify areas of concern that can be dealt with in an organization development programme.
The diagnostic cycle
The diagnostic cycle as described by Manzini (1988: 11) consists of:
- data gathering;
- action planning;
The two most used analytical tools are SWOT analysis and PESTLE analysis. A SWOT analysis is a ‘looking in’ and ‘looking out’ approach that covers the internal organizational factors of strengths and weaknesses and the external factors of opportunities and threats. PESTLE analysis is an environmental scanning tool that covers the following factors: political, economic, social, technological, legal and environmental.
Diagnostics are tools such as questionnaires or checklists that gather information about a business or on the opinions and attitudes of employees in order to identify issues and problems that can be dealt with in an organization development programme. They enable those concerned with organization development to understand what is happening and why it is happening so that they can do something about it. Diagnostics can be used to assess overall organizational effectiveness in the shape of general strategic, business and operational issues, or they can deal with more specific areas of concern such as a review of the organization’s ideology, culture or climate, or a survey of levels of engagement or commitment. Examples of the approach used by various diagnostic instruments are given below.
Organizational ideology questionnaire (Harrison, 1972)
This questionnaire deals with the four orientations defined by Harrison (power, role, task and self). The questionnaire is completed by ranking statements according to views on what is closest to the organization’s actual position. The following are examples of statements:
- a good boss is strong, decisive and firm but fair;
- a good subordinate is compliant, hard-working and loyal;
- people who do well in the organization are shrewd and competitive, with a strong need for power;
- the basis of task assignment is the personal needs and judgements of those in authority;
- decisions are made by people with the most knowledge and expertise about the problem.
Organizational culture inventory (Cooke and Lafferty, 1989)
This instrument assesses organizational culture under 12 headings:
- Humanistic-helpful– organizations managed in a participative and person-centred way.
- Affiliative– organizations that place a high priority on constructive relationships.
- Approval– organizations in which conflicts are avoided and interpersonal relationships are pleasant – at least superficially.
- Conventional– conservative, traditional and bureaucratically controlled organizations.
- Dependent– hierarchically controlled and non-participative organizations.
- Avoidance– organizations that fail to reward success but punish mistakes.
- Oppositional– organizations in which confrontation prevails and negativism is rewarded.
- Power– organizations structured on the basis of the authority inherent in members’ positions.
- Competitive– a culture in which winning is valued and members are rewarded for out-performing one another.
- Competence/perfectionist– organizations in which perfectionism, persistence and hard work are valued.
- Achievement– organizations that do things well and value members who set and accomplish challenging but realistic goals.
- Self-actualization– organizations that value creativity, quality over quantity, and both task accomplishment and individual growth.
Typical dimensions of organizational climate questionnaires (Koys and De Cotiis, 1991)
- Autonomy– the perception of self-determination with respect to work procedures, goals and priorities.
- Cohesion– the perception of togetherness or sharing within the organization setting.
- Trust– the perception of freedom to communicate openly with members at higher organizational levels about sensitive or personal issues with the expectation that the integrity of such communications will not be violated.
- Resource– the perception of time demands with respect to task completion and performance standards.
- Support– the perception of the degree to which superiors tolerate members’ behaviour, including willingness to let members learn from their mistakes without fear of reprisal.
- Recognition– the perception that members’ contributions to the organization are acknowledged.
- Fairness – the perception that organizational policies are non-arbitrary or capricious.
- Innovation– the perception that change and creativity are encouraged, including risk-taking into new areas where the member has little or no prior experience.