Organisational Development and Change Management: Definitions and Interventions

Organisational Development & Change Management: Class 1

Organisational development & change management Class 1

What is Organisational Development (OD)?

"If you think there is consensus on what OD is, you haven't been around long enough"

OD 70 Years Ago

70 years ago .

• Stable jobs
• Stable industries
• Stable environments
• Low-skilled, manufacturing work

Today: Nonstop Change

Today: nonstop CHANGE

• Ageing society
• Globalisation
• Labour shortage
• Technological development
• Crises (war, covid, energy)
• Globalization
• Changes in preferences: work-life balance, employee wellbeing, personal growth, ...

= All influence organisations and work. = The organisation should CHANGE as well! Organizations must create a healthy discomfort with the status quo. > To thrive, companies need to be in a never-ending state of transformation, perpetually creating fundamental, enduring change. -> OD looks at: how to make these changes successful, how to guide the employees and company through the changes?

OD vs. Change Management

OD # Change management "All OD involves change management, but change management may not involve OD"

Change Management vs. Organization Development Comparison

Change management Organization development

System Focus

Specific part of the system Entire system All departments need to collaborate.

Human Aspect

Economic, financial, technical focus No real human focus. Driven by humanistic values Ensure that everyone is aboard.

Planned Change Approach

Programmatic All steps are known beforehand. Adaptive and flexible End goal is known, but along the way, the optimal path needs to be figured out.

Change Agent Role

Expert in issue Ex. merger expert for a merger. Process guide General knowledge about the process of change, to guide thewhole organisation.

Direction of Change

Top down In collaboration with employees

Organizational Effectiveness Metrics

Financial Higher profit = good change. Financial, sustainability, and employee satisfaction All 3 should be present, otherwise the change is not successful.

Time Horizon

Short term Long term

Examples of Change

Introduce a new technology, new leader, develop a new service, company mergers & acquisitions, ... Create learning networks across departments, improve employee involvement, self- managing teams, adapt business strategy to changed environment, ...

Definitions of OD

"A system-wide application and transfer of behavioural science knowledge to the planned development, improvement, and reinforcement of the strategies, structures and processes that lead to organization effectiveness" (Cummings et al., 2020) Evidence-based decisions! "Organization development is the process of increasing organizational effectiveness and facilitating personal and organizational change through the use of interventions driven by social and behavioral science knowledge" (Anderson, 2015) "Organization development is a system-wide process of data collection, diagnosis, action planning, intervention, and evaluation aimed at (1) Enhancing congruence (alignment) among organizational structure, process, strategy, people, and culture (2) Developing new and creative organizational solutions (3) Developing the organization's self-renewing capacity It occurs through the collaboration of organizational members working with a change agent using behavioral science theory, research and technology" (Michael Beer, 2015)

Key Aspects of OD

OD is about ...

• Evolving, adapting, improving as an organization
• Through changes ('interventions') in structure, processes, culture, strategy
• Changes: from individuals to teams to entire organizations
• Changes: flexible and adaptable
• Facilitating change through people involvement
• Based on behavioral science knowledge

Origins of OD

Where does OD come from? (handbook paragraph 1.3 > background) 5 movements that made OD as it is today:

Laboratory Training Action Research/Survey Feedback Normative Approaches CURRENT OD PRACTICE Quality of Work Life Strategic Change 1950 1960 1970 1980 1990 2000 Today

1) Laboratory Training/T-Group (Kurt Lewin)

= a small, unstructured group, in which participants learn from their own interactions and evolving group processes about such issues as interpersonal relations, personal growth, leadership and group dynamics.

2) Action Research/Survey Feedback

Action research = a systematic and reflective inquiry process that is used to address specific problems or issues within an organization or community. It involves a cyclical process of planning, taking action, observing the results, and then reflecting on those results to inform further action. Survey feedback = a specific method within the broader context of action research. It involves the use of surveys to collect data from individuals within an organization or group. The collected data is then analysed and used to provide feedback and make improvements.

3) Normative Approaches

• Likert's participative management program
• Blake and Mouton's Managerial Grid

4) Quality of Work Life

Favourable work conditions support employee satisfaction and productivity. Initially focused on work design, afterwards expanded beyond work design.

5) Strategic Change

Globalization and increased environmental complexity > larger-scaled change and more intricate > need of strategic planning of change: align organization design and strategy with the environment. > Increased relevance of OD to the organization and its managers.

Diagnostic OD vs. dialogic OD: book p. 12-13

Why Care About OD?

Why should I care?

• You can't hide for change!
• Currently 70% of change efforts fails!
• You will be responsible for change! (who is the OD practitioner? Book p. 44-45)

Review Questions

1. "An OD project is successful if the organization's profit has increased" > We need the financial aspect, but sustainability and employee satisfaction are crucial!
2. "All OD requires change management" > True! The other way around, this statement wouldn't be true.
3. "All OD projects follow the same steps" > True! See class 2: Entering & contracting > diagnosing > planning & implementing change -> evaluating & institutionalizing change.

Class 2: Theories of Planned Change

Class 2: Theories of planned change Illustration case: book p. 29-31

*In this course: when we talk about change: we refer to change planned by organisation members instead of caused by global, economic and technological development. > to increase effectiveness and capability to change itself. Why pursue planned change? To solve problems, learn from experience, reframe shared perceptions, adapt to external environmental changes, improve performance or to influence future changes. Traditional approaches: different steps: change is preceded by data gathering to form a diagnosis for which remedies will be sought. > to optimize organisation to its ideal state. Assumptions: apprehension of objective data is possible and this data can be used for implementing beneficial change. ( challenged by post-modernist approaches)

Why Theories of Change are Needed

Why do we need theories?

• 70% of the change efforts that organisations implement fail!
• There are so many points in time in the change process that things can go wrong: change is a very long process with many different steps (wrong training, wrong people leading change, get employees aboard, ... )
• To make sure that change is effective and successful: understand the process of change! > look at research!
• Each model has an idea about what steps should be taken for the change to be successful.

5 Theories/Change Models

5 Theories/change models: "What are the steps of a change process?" (HB p. 20-27) Describe activities that must take place for successful organizational change.

1. Lewin's change model
2. Kotter's 8 step model
3. Action research model But there are many more!
4. Positive model
5. Dialogic OD model

*Comparison of planned change models: book p. 22

1) Lewin's Change Model (1951)

1) Lewin's change model (1951) (case book p. 29-31) "Organization as an ice cube" Behaviours result of 2 forces: forces striving to maintain the status quo and forces pushing for change. To initiate change, a decrease in status quo forces and/or an increase in change forces is required. A decrease in status quo forces is optimal because it produces less tension and resistance.

• Unfreeze: psychological disconfirmation (introducing information that shows discrepancies between the current and desired behaviours) > unlearning a behavior happens due to psychological discomfort: something needs to change. Reducing the status quo forces
• Move: intervention shifts behavior through changes in organizational structures and processes.
• Refreeze: make the change situation stick (institutionalize): stabilize again in a new equilibrium: make sure the new state is sustainable, for example by supporting mechanisms (rewards, structures, culture) and giving people training and support. Regularly check whether the members are using the new processes and celebrate successes.

> Change means stepping away from the status quo: the status quo needs to be fought before things can change. > Employees need to be ready and open for change: resistance would mean that the organisations stays frozen.

Critique of Lewin's Model

Critique: oversimplification!

• Does not take into account the readiness of employees for change and their experiences: how to create discomfort with the status quo? Which impact does it have on the employee? ...
• General framework with relatively broad steps.

2) Kotter's 8-Step Change Model

2) Kotter's 8-step change model Builds on Lewin's model, but adds steps:

8 7 Incorporate changes into culture 6 Never let up 5 Generate short-term wins 4 Empower broad-based action 3 Communicate the vision for buy-in 2 Develop a change vision 1 Create a guiding coalition Establish a sense of urgency

1. Establish a sense of urgency: make people clear that it will go wrong if they continue doing it the current way.
2. Create a guiding coalition: a team with OD-managers, maybe HR-managers, CEO's that will be responsible for managing the change.
3. Develop a change vision: of how the future will look like after the change, what the benefits of the change are and how it should happen.
4. Communicate the vision for buy-in: everyone needs to know it!
5. Empower broad-based action: time to implement the intervention.
6. Generate short-term wins: don't wait until the end-result is there, it might take even years! Work with intermediate steps and make sure to celebrate and institutionalize them. Make sure everyone knows that they are on the right track.
7. Never let up: on moments that change is not working: change something and get on the right track again.
8. Incorporate changes into culture: refreeze them: make sure it sticks: institutionalize.

3) Action Research Model

3) Action research model > one of the 5 movements that were at the basis of the field of organization development. Research of the organization is pursued to decide on what actions or interventions need to be implemented. Cyclical process: heavy emphasis on data gathering and diagnosis prior to action and careful evaluation of results after action is taken. Collaboration among organization members and OD practitioners

1. Problem identification: when someone in the organisation senses that the organisation has problem(s) that might be solved with the help of an OD practitioner.
2. Consultation with a behavioral science expert: Client and OD practitioner carefully assess each other to become conscious of assumptions and values.