What is organisational development (OD)?
Organisational development can seem like quite a vague term. Development can mean a lot of different things, so it is often hard for managers to understand what OD actually entails. This lack of clarity can result in organisational development being ignored or implemented thoughtlessly. If you take the time to understand what high-quality organisational development involves then you can begin to enjoy the benefits it brings to company performance.
The strategic alignment of the business side of an organisation in conjunction with its human resources side.
The Chartered Institute of Personnel and Development define OD as a “planned and systemic approach to enabling sustained organisation performance through the involvement of its people”. We see it as the strategic alignment of the business side of an organisation in conjunction with its human resources side. So much preparation and effort goes into business plans and the human aspect is often neglected or treated in an isolated and asynchronous manner, leaving the HR department to fend for itself. Having a holistic strategy that combines both the business and HR aspects of the organisation can provide companies with a flexible structure that lends itself to constant development and improvement. Tightly aligned organisations have higher performance than organisations with misaligned strategies (Christiansen, 2008).
How does organisational development work?
The first questions organisational development tries to answer when it is first implemented are: Where are you now as an organisation? Where do you want to be in the future? How do you plan to get there? In what time-frame? These may seem like obvious questions with simple answers but without in-depth structure and planning these questions can often be put on the side-lines and development slows down or halts as employees meander along with their work without any clear, shared visions or objectives. Good OD will tackle objectives, strategy and company culture to create a sustainable framework for success, resilience, longevity and growth.
Once the company requirements are identified you can begin to implement a proper solution.
This starts with a diagnosis of the existing state of affairs as well as the outstanding needs of organisation. Through the use of diagnostic tools, a gap analysis is used to identify what these needs are and how they are, or are not, being fulfilled. Once the company requirements are identified you can begin to implement a proper solution. OD is not a functional discipline; it focuses on applying behavioural science knowledge as practice (Garrow, 2009). This practice is very contextual and can differ substantially depending on the organisation.
An overview of a solid OD plan might look like this:
1. Mapping Organisational Context
2. Undertaking OD Interventions
3. Managing Change Process
4. Measuring and Evaluating OD
(Mackenzie and Gordon, 2016)
It is also important to bear in mind that while you execute an OD plan you must be taking a multidisciplinary approach, working with colleagues from different departments and thinking about the plan on an organisational as well as a personal level.
What does organisational development do?
Now you know what OD is and roughly how it works, the question is – how can OD benefit my company? The end goal of OD is to maximise the value of an organisation, by aligning and streamlining strategy – organisations will become more effective, more efficient and more flexible. Institutionalising continuous growth and improvement by managing changes in such a way that allows for further change in the future. This sort of workforce and management malleability is becoming increasingly important as the rate of change in technology and business practice accelerates. All of this is done in the pursuit of organisational effectiveness and a higher standard of performance.
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Christiansen, L. C. and Higgs, M. (2008) ‘How the alignment of business strategy and HR strategy can impact performance: A practical insight for managers’ Journal of General Management, 33(4), pp. 13–34.
Garrow, V, Varney, S and Lloyd, C. (2009) ‘Fish Or Bird?: Perspectives on Organisational Development (OD)’ Institute for Employment Studies.
Mackenzie, J., and Gordon, R. (2016). ‘A study on organisational development.’ Working Paper 6. Jakarta: Knowledge Sector Initiative.