UNIT 4:ORGANIZATIONAL

DEVELOPMENT (OD)
• Definition
• Objectives
• Characteristics of OD
• Phases of OD Program
• Classifying OD interventions
• OD’s future
• OD in Indian Industry
• Criticism of OD
 OD - DEFINITION
Organisation Development is an effort (1) planned
(2) organisation wide and (3) managed from the
top to (4) increase organisation effectiveness and
health through (5) planned interventions in the
organisation’s processes, using behaviour-science
knowledge.
 CHARACTERISTICS OF OD
1. OD is a planned long term effort
It is not an ad-hoc short activity. An OD programme usually
consists of a series of techniques (called interventions) which
follow one another in a planned way for a number of years.

2. OD is a system-wide change
Emphasis of OD is on changing the system as a whole rather
than changing a few individuals. OD approach differs from other
training programmes where the target of change is the individual
and not the total system. System does not always mean the whole
organisation. It may even mean a work-team or a role-set which
typically includes an individual’s immediate supervisor, his
subordinates and certain members of his own or other
departments with whom he must work closely by virtue of the
work flow and authority structure of the organisation. It is believed
that the sources of many organisational problems lie within these
teams or groups. Hence they should be made the target of change.
 CHARACTERISTICS OF OD
3. OD emphasises change in culture
OD’s primary focus is on changing culture. Culture
means prevailing patterns of activities, sentiments,
norms, beliefs, attitudes and values. These are changed
by directing OD efforts towards the important social
processes of the organisation such as planning, decision
making, communication, etc.
Thus, when the work related attitudes, beliefs,
sentiments and values of people change, a change may
also become necessary in the organisation’s design,
structure and technology. This is known as the domino
effect where one change touches off a sequence of
related and supporting changes throughout the
organisation.
4. OD is an Educational Strategy
OD is directed towards changing organisation’s culture, which can be
brought through education only. There can be 3 ways to educate people
depending upon the assumptions which one makes about them.
• If it is assumed that all people are rational and they accept a change
if they are convinced about its advantages, then simple
dissemination of knowledge about the benefits may be enough. This
type of educational strategy is known as empirical-rational strategy.
• If the assumption is that people accept only that change which
matches their attitudes, values and norms then they may need to be
educated twice – first, for discarding their current values and second,
for replacing them by the desired values. This strategy is called
normative re-educative strategy.
• If the assumption is that people accept only those changes which are
dictated to them by some superior authority then they may need to
be ordered. This type of strategy is called power coercive strategy. In
OD, normative re-educative strategy is generally followed.
 CHARACTERISTICS OF OD
• OD uses behavioual science knowledge
OD experts draw on the knowledge and
technology of various behavioural sciences such as
sociology, political science, economics, etc. Some
examples of the practical uses to which the
knowledge of these sciences has been put are as
follows:
• Maslow’s, Herzberg’s and McGregor’s views for
motivating people
• Homan’s views (interaction, activity and sentiments) for
molding social activity
• Lewin’s views (force field theory) for introducing change
 CHARACTERISTICS OF OD

• OD focuses on practice
The reason for this is that if a goal is to change
organisation culture, practice is required for such change
to occur.
One does not learn to play cricket or drive a car by
getting increased knowledge about how to play cricket or
drive a car. Nor can one change one’s managerial style or
strategy through receiving inputs of new knowledge alone.
It is necessary to examine present behaviour, experiment
with alternatives and begin to practice modified ways, if
change is to occur. OD techniques rely heavily on
experience as their main method of influence.
 CHARACTERISTICS OF OD
• OD recognizes the importance of collaborative
management
– (i.e., a shared kind of management – not a
hierarchically imposed kind) of all its activities such as
collection of data, diagnosis of the problem, planning
of interventions, etc.

• OD requires the services of a change agent

– In early phases of the programme his services are
considered essential mainly because of his greater
expertise and his ability to look at problems more
objectively.
 OBJECTIVES OF OD
1. To develop the organisation’s capacity to effectively
diagnose and solve its current problems.
2. To enable the organisation to successfully adapt itself
to a new environment.
3. To increase the level of trust and openness of
communication among organisational members.
4. To increase member’s identification and commitment
with the organisation.
5. To improve the planning and goal-setting skills of
members and teams.
 OBJECTIVES OF OD
6. To create conditions where conflict between members is
brought out in the open and managed rather than swept
under the rug.
7. To move towards high collaboration and low competition
between interdependent units.
8. To reorganise work, e.g., by reducing the layers of
supervision or by relocating decision-making and problem
solving as close to the sources of information as possible.
9. To change the cultural norms of the organisation.
10. To change managerial strategy from total direction and
control to a more participative style.
 PHASES OF OD PROGRAM
1. Motivation for introducing an OD program
2. Signing the contract
3. Diagnosis, Data collection and Deliberation
4. Planning the strategy for change and working
out specific problem-solving interventions
5. Programme implementation
6. Monitoring and Evaluation
7. Institutionalization and Internalisation
 PHASES OF OD PROGRAM
1. Motivation for introducing an OD program
The management tells the OD experts about its
problems and the changes it would like to introduce.
The expert on his part tells the management what OD is
and what it involves. Every OD technique is a calculated
risk which may click or may not click.
The question which the expert poses before
management is, “Which problems would you rather
have? The ones you have now? Or the ones you will
have if you try to solve the ones you have now?” Often
this leads to greater clarity and commitment on the
part of management. The expert also explains the
financial implications of the proposed OD programme.
 PHASES OF OD PROGRAM
2. Signing the Contract
If at the end of the first phase, the expert is
invited to work for introducing OD in the organisation,
he may be asked to sign a written agreement defining
his relationship with the organisation. The expert may
have any of the following types of relationship with
the organisation:
• Periodic review
• Project arrangement
• Educational consultation
• Trainer arrangement
• Package programme
• Consulting team
 PHASES OF OD PROGRAM
3. Diagnosis, Data collection and Deliberation
This phase consists of activities designed to
provide on accurate account of the present state of
the organisation. A comparison of ‘what is’ with
‘what should be’ reveals the gap between actual
and desired state and the need for OD programme.
a) Deciding where to start enquiry and its extent
b) Determining the kind of data to be collected
c) Determining the method of data collection
d) Collaborating with the client
 PHASES OF OD PROGRAM
4. Planning the strategy for change and working out specific
problem-solving interventions
In this phase, the external and internal expert jointly
work out the strategy for change. They discuss with each
other the various types of OD techniques for dealing with the
problems and finally plan their phasing, sequencing and
linkages. There is no best strategy suitable for all
organisations. Every strategy must be tailor made in the light
of the organisation’s problems, the amount of time and
money available, readiness and receptiveness of different
sections to the OD programme and the expert’s own
experience.
In working out specific problem-solving interventions the
expert follows the action research model. He formulates the
action plan on the basis of certain hypotheses which he
continuously tests one after the other for their practical
implications. This makes the plan flexible and practical.
 PHASES OF OD PROGRAM
5. Programme Implementation
Once the OD programme has been jointly designed the
next phase is to implement it. The programme must be
communicated to all concerned individuals in the organisation.
For this purpose, seminars and meetings may be arranged
where the rationale behind the programme can be explained.
This would allay the rumours and fear of people and provide
useful feedback and indication of what is viable.
Next to decide, whether the programme should be
introduced in one go or in phases. Phasing may be temporal
(in terms of time) or spatial (in terms of various parts of the
organisation). Temporal – some elements of the change is
introduced earlier and some later. Spatial – implementation of
change in part of the organisation first which has maximum
acceptability. The change then gradually spreads to other
parts.
 PHASES OF OD PROGRAM
6. Monitoring and Evaluation
As the OD programme progresses the
measurement of its impact becomes essential. The
outside expert gets the required feedback in
several ways, such as by holding critique sessions,
carrying out systematic studies with the help of
control groups, careful observation of behaviour
and so on.
 PHASES OF OD PROGRAM
7. Institutionalization and Internalisation
This is the last phase of OD programme. By
institutionalisation is meant making the change a
permanent part of organisation and by internalisation
is meant stabilisation of change so that it becomes a
natural part of people’s work style lest they may slip
back to the old style.
The desired change that has taken place in the
attitudes and behaviours of individuals and groups is
reinforced by making appropriate changes in the
appraisal, compensation, training and communication
subsystems. OD programme is institutionalised by
creating a separate department to take care of the
programme on the outside expert’s withdrawal.
 CLASSIFYING OD INTERVENTIONS
• Individual and small group interventions
• Team and inter team interventions
• Structural interventions
• Comprehensive interventions
 OD’s FUTURE
• Leadership and Values
• OD training
• Interdisciplinary nature of OD
• Integrative practice
• Mergers, acquisitions and alliances
• Rediscovering and recording history
• The search for community
 OD’s FUTURE
• Leadership and Values
– For OD to flourish, top management – CEOs, boards
of directors, top executives, including HR executives
and OD consultants must place high value on strong
individual, team and organisational performance
coupled with people oriented values.
• OD training
– The future will hold a need for availability of T-group
training– as a training intervention not as an
organisational intervention – particularly for both
aspiring OD practitioners and managers.
 OD’s FUTURE
• Interdisciplinary nature of OD
– OD’s future is related to other disciplines. OD has been a
highly interdisciplinary, eclectic field. It has been built from
theory, research and practice in social psychology, adult
education, community development, anthropology,
philosophy, counseling, psychiatry, HRM and other fields.
• Integrative practice
– It would be a challenge, for any one person to develop skills
in all of the interventions. OD practitioners need to be as
knowledgeable as possible about structural interventions
and integrations. At the same time, experts in the
technological aspects of these fields also need to be
knowledgeable about OD. An ideal arrangement may be for
OD professionals to join with such experts on consulting
teams.
 OD’s FUTURE
• Mergers, acquisitions and alliances
As the tempo of business transactions
worldwide increases, the phenomena of acquisitions,
mergers and alliances also become more evident.
Interventions that have grown out of the OD field
can be highly relevant in helping two or more
organisational cultures blend and in improving the
potential dislocation and pain that can occur when
organisations are combined. Such interventions will
require a high degree of interpersonal, political and
cultural skill of the consultant – even more so when
than one country and /or language is involved.
 OD’s FUTURE
• Rediscovering and recording history
The history of OD is essential for retaining
and improving effective OD interventions and
approaches. Some portions of OD history are in
danger of being lost forever, although some are
likely to be reinvented from time to time. We
are convinced that hundreds of interventions
devised by OD consultants have been
tremendously successful in particular
applications and used perhaps two or three
times again, but never recorded and published.
 OD’s FUTURE
The search for community
Finally, the search for community will be increasingly high on
the agendas of organisations and OD efforts in the future.
Outcomes such as the production of high-quality goods and
services, making a profit and staying viable and competitive are
superordinate goals for vast numbers of organisations.
Now, people believe that how work is accomplished and how
people relate to each other are highly important matters. People may
have different prescriptions for meeting these goals but at some level
they know that cooperation is better than fighting, and friendship is
more rewarding. Many organisations, want even more than a
profitable, well managed, reasonably harmonious workplace. And it
has been referred as a ‘sense of community.’ We believe future OD
efforts increasingly will be aimed at both high organisational
performance and a sense of community.
 CRITICISM OF OD
1. There is not enough evidence to scientifically prove
the effectiveness of OD techniques: Most of the
documentation is in the form of case studies which
do not establish a clear linkage between OD effort
and organisational performance. But lack of
‘scientific proof’ also does not imply that we
conclude the opposite – that OD efforts do not lead
to improved performance. There is, in fact, more
than enough subjective evidence to warrant the
belief that such efforts may, under favourable
circumstances, result in major benefits.

2. OD can be no more powerful than the behavioural

science concepts on which it rests. Behavioural
science itself has various limitations and these are
applicable to OD also.
 CRITICISM OF OD
3. OD concepts are little more than “advanced human
relations”: This is not correct. OD goes well beyond the human
relations efforts in scope, focusing on the entire socio-
technical system rather than on limited aspects of either one
or the other. It rejects simplistic human relations notions of
‘one best way’ and ‘happiness leads to performance’. It
believes that development occurs as members learn
experimentally rather than following dictums of engineers or
personal specialists.

4. OD’s focus on planned, one-time transformational change

which worked well during the 60’s and 70’s (when changes
were not so rapid or rather continuous) does not work so well
today in a continuously changing environment which calls for
continuous learning and change.
 CRITICISM OF OD
5. OD represents a long term and expensive
investment on the part of the client organisation. It
does not have quick remedies. It does not offer
short-cuts to total organisational improvement.

6. OD has no distinct identity because it covers

under its umbrella all sorts of similar and dissimilar
techniques. No one knows what the OD field is. OD
by attempting to become everything has become
nothing.
 OD IN INDIAN INDUSTRY
OD has been successfully implemented in a number of
companies in India. Some notable examples are Tata Iron &
Steel Co., Hindustan Machine Tools, State Bank of India.
The following conditions must exist for the success of an OD
programme:
1. Support from the top: The programme must be supported
by the top management. Its behaviour must communicate
to the people that they will be rewarded for engaging in
improvement activities.
2. Match between the professed values and behaviour: The
actual behaviuor of the top management must match
with its professed values. If the top management
preaches Theory Y and practices Theory X, subordinates
lose trust in it and become cautious, conservative and
self-protective.
 OD IN INDIAN INDUSTRY
3.Definite goal: Some organisations promote OD
programmes without first determining the purpose which
these programmes are intended to achieve.
4.Domino effect: It should be remembered that change in
any one part of the organisation calls for a sequence of
related and supporting changes in many other parts. If this
is not done the change effort may not succeed. This is called
‘domino effect’. Thus a change in the technology of a task
may require a change in the communication pattern or a
change in the organisation structure or a change in the
reward system.
5.Strong link-pins: OD can succeed if ‘linkpins’ are present in
the organisation. These are the roles which connect various
levels and various parts of the organisation. They thus help
in spreading out the change in all directions.
 OD IN INDIAN INDUSTRY
6. Tailor made programme: Sometimes an OD programme used
elsewhere is borrowed and applied without examining its
appropriateness for the present organisation. They thus help in
spreading out the change in all directions.
7. Difference between training and OD: The OD programme must
not be confused with the usual training activities such as sensitivity
training or MBO. These activities, no doubt, may form part of an
OD programme but they are not OD in themselves. Further, OD
programme should be expected to yield quick results. An OD effort
may be expected to show meaningful results only after 3 to 5
years.
8. Correct understanding of the role of external consultant: The
role of the external consultant should be clearly understood. Very
often the top management thinks that its responsibility ends with
the handling over of the problem to the consultant. It thinks that
thereafter it is the consultant’s entire responsibility to handle the
change effort. This is not correct. It is only through the joint effort
of both that the synergy effect can be produced.