Unit 1

INTRODUCTION TO ORGANISATION DEVELOPMENT

Dr. D. Joseph Anbarasu

1. Introduction

Organizations are facing unrelenting pressure to adapt and evolve to provide better quality
services. Many need to undergo significant change to develop and deliver services in cost
effective ways that customers and citizens want. The introduction of a corporate governance
and capacity assessment presents a further challenge for Organisations in the ‘modernization’
process. This is partly because the introduction of new Organisations initiatives does not
always mean that others disappear or cease to be relevant.

Many change initiatives are limited in their strategic impact because organisations try to
implement a number of loosely connected activities too fast without proper co-ordination and
follow through. People management and development implications are often not fully
appreciated or addressed as part of the change process. The result is ‘initiative fatigue’ where
staff becomes disillusioned and more resistant when managers try to implement the next
major change.

A number of forward-thinking authorities have recognized the need for Organisation

Development During recent years ‘Organizational Development’ (OD) has re-emerged as a
highly significant concept in the strategic management of change since it provides a holistic
approach to help Organisations focus on and deliver the cultural and organisational change
needed for all types of continuous improvement. Using this approach, all initiatives are
considered as part of an overall OD ‘map’ which means that systems, culture and activities
can more easily be aligned to the achievement of organisational goals.

OD has three significant benefits for managing sustained change; it enables better use (or
‘leverage’) of financial, human and technological resources, it fosters a greater sense of
organisational purpose and it is therefore more likely to deliver the required performance
improvement with less effort than would otherwise be necessary.

2. Meaning of Organizational Development

The traditional view of ‘Organizational Development’ tended to focus on top-down activities

to improve organisation's ‘systems’ and 'processes’. However, experience in both the public
and private sectors has shown that to raise organisational performance effectively,
‘Organizational Development’ needs to take account of both internal and external factors
rather considering individual components in isolation.

Although there is no fixed definition of the term, some current attempts to capture this
broader, more holistic view of ‘Organizational Development’ include:

“A system-wide application of behavioural science knowledge to the planned development

and reinforcement of organisational strategies, structures and processes for improving an
organisation's effectiveness" Cummins and Worley (1997)

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“A holistic process of planned change and improvement to assist organisations in responding
to their dynamic environment through the effective diagnosis and management of their
structure, systems and culture”

Organizational Development (OD) is about moving the organisation on by taking deliberate,

planned steps to create an environment that will enable staff to understand and deliver the
organisation’s objectives. Responding to and working with key stakeholders at both national
and community level in the development of appropriate services, forms an essential part of
this evolutionary process.

OD involves both ‘hard’ and ‘soft’ issues. The ‘hard’ issues for OD are strategies and
policies, structures and systems. The ‘softer’ issues in the main are developing appropriate
skills, behaviours and attitudes, culture and a style of leadership that will enable the
organisation to achieve optimum performance. Both the ‘harder’ and ‘softer’ issues of OD
need to be addressed to avoid conflict between goals and needs.

Organizational development (OD) is defined as a long-range effort to improve an

organization's ability to cope with 'Change and its problem-solving and renewal processes
through effective management of organization culture which ': involves moving towards a
third-wave organization and an attempt to achieve corporate excellence by accelerating the
desires of individuals for growth and development with organizational goals.

Organizational Development differs from Management Development. While MD purports to

prepare individual managers for better performance and meet higher responsibilities, the OD
goes one step further and purports to change the organizational environment where the
managers work. However, both are complementary to each other. (Dwivedi-1985)

Organizational development efforts then, are planned, systematic approaches to change. They
involve changes to the total organization or to relatively large segments of it. The purpose of
OD efforts is to increase the effectiveness: of the system and also, to develop the potential of
all individual members. Finally, a series of planned behavioral science intervention activities
are carried out in collaboration with organization members to help find improved ways of
working together towards individual and organizational goals.

Another way of understanding OD is to know what it is not:

'OD is not a micro approach to change. Management development, for example, aims at
changing individual behavior. Whereas OD is used on the macro goal of developing an
organization-wide improvement in managerial system.’

OD is more than any single technique. Whereas OD consultants use many differing
techniques such as total quality management (TQM) or job enrichment. No single technique
represents the OD discipline.

OD does not include random or ad hoc changes. OD is based on incremental appraisal and
diagnosis of problems leading to specific types of change, efforts.

OD is aimed at more than raising morale or attitude. OD is aimed at overall organizational

effectiveness. This may include participant satisfaction, an aspect of the change effort and
other effectiveness parameters.

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Schools of Thought:

There are two schools of thought viz.,

1) Programmed Procedure School; and 2) System Process School.

The system process school considers organization development in the context of both its
internal and external environment. Proponents of this approach view organization as a system
which can be changed and developed to best achieve its goals and objectives. Insights drawn
from recent developments in behavioral sciences have contributed to the system-process
school. An emerging role for OD is system based and focuses on total organization
effectiveness and hence goes beyond the traditional personnel programmers. The emphasis is
much more on work groups within and across departments rather than individuals as such.
While personnel programmers demand conformity for prescribed policies and procedures, the
system process school encourages openness, and collaborative ways of solving problems so
that the outcomes are advantageous to both the individual and the organization. It is likely
that the objectives of both the schools are contradictory to certain extent.

Programmed Procedure School System Process School

Internal Internal & External
Personnel - oriented Department - oriented
Individual Group
Sectional Holistic
Prescriptive Open
System internal Interdisciplinary

3. Definition of OD

OD may be defined as “a systematic, integrated and planned approach to improve the

effectiveness of the enterprise. It is designed to solve problems that adversely affect the
operational efficiency at all levels” (Koontz et.al. 1980). It is based on scientific awareness of
human behavior and organization dynamics. Being an organization wide effort, it is directed
towards more participative management and integration of individual goals with organization
goals OD is intended to create an internal environment of openness, trust, mutual confidence
and collaboration and to help the members of the organization to interact more effectively in
the pursuit of organizational goals. Thus, the organization is enabled to cope effectively with
external force in the environment.

# According to Richard Beckhard, Organizational Development is “an effort planned,

organization-wide, and managed from the top to increase organization effectiveness and
health through planned interventions in the organization’s processes employing behavioural
science knowledge”.

# Organizational Development is an organizational Process for understanding and improving

any and all substantive process an organization may develop for performing any task and
pursuing any objectives

# Organizational development is a set of behavioral Science based theories, values, strategies

and techniques aimed at the planned change of organizational work setting for the purpose of

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enhancing individual development and improving organizational performance, through the
alteration of organizational members on the job behavior (Porras and Robertson, 1992)

# Beer defines OD as a system-wide process of data collection, diagnosis, action planning,

intervention and evaluation aimed at enhancing congruence between organizational structure,
process, strategy, people and culture.

 Developing new and creative organizational solutions

 Developing the organizations Self-renewing capacity. It occurs through collaboration of
organizational members working with a change agent using behavioral science theory,
research and technology.

# OD can be defined as a planned and sustained effort to apply behavioral science for system
improvement using reflexive, self-analytical methods. (Schmuck and Miles, 1971)

These definitions clarify the distinctive features of OD and suggest why it is such a powerful
change strategy. The participative, collaborative, problem-focused nature of OD marshals the
experience and expertise of organization members as they work on their most important
problems and opportunity in ways designed to lead to successful outcomes

4. Objectives of OD

The objectives of OD may be stated as follows:

 It should ensure improved organizational performance as measured by profitability,

market share, innovativeness etc.
 It should assure better adaptability of the organization to its environment.
 It develops the willingness of the members to face organizational problems and contribute
creative solutions to these problems. Improvement in internal behavior patterns such as
interpersonal relations, intercrop relations, level of trust and support among role
members, understanding one’s own self and others, openness and meaningful
communication and involvement in planning for organizational development.

5. Characteristic Features of OD

To enlarge upon the definitions of OD, let us examine some of the basic characteristics of OD
programs.

Planned Change:

It is a planned strategy to bring about organizational change. This change effort aims at
specific objectives and is based on the diagnosis of problem areas.

Collaborative:

OD typically involves a collaborative approach to change which includes the involvement

and participation of those organization members most affected by the changes.

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Performance:

OD programs include an emphasis on ways to improve and enhance performance and quality
(TQM).

Humanistic:

OD relies on a set of humanistic values about people and organizations that aims at gaining
more effective organizations by opening up new opportunities for increased use of human
potential systems. OD represents a systems approach concerned with the interrelationship of
various divisions, departments, groups and individuals and interdependent subsystems of the
total organization.

6. Focal Area

Change is planned by managers to achieve goals. It involves collaborative approach and

involvement. It emphasizes not only on ways to improve and enhance performance but also
upon increased opportunity and use of human potential relationship among elements and
excellence. Scientific approaches supplement practical experience.

An OD practitioner (either manager or consultant) is a person in an organization responsible

for changing existing patterns to obtain more effective organizational performance.
Organizational development practitioners have come to realize that conventional training
techniques are no longer sufficient for affecting the type of behavioral changes needed to
create adaptive organizations. New techniques have been developed to provide participants
with the competence and motivation to alter ineffective patterns of behavior. One interesting
question is, can OD be used to change nations as well as organizations?

There are many OD techniques, and any individual practitioner may rely on one or a
combination of approaches. Regardless of the method selected, the objectives are to work
from an overall organization perspective, through increasing the ability of the "whole" to
respond to a changing environment. Organizations have objectives such as making profit,
surviving, and growing; but individual members also have desires to achieve, unsatisfied
needs to fulfill, and career goals to accomplish within the organization. OD then, is a
"process for change which can benefit both the organization and the individual”. In today's
business environment managers must continuously monitor change and adapt their systems to
survive by staying competitive in a turbulent arena.

The roots of OD lie in the famous Hawthorne experiments carried out at the Western Electric
company by Elton Mayo and his associates. These experiments highlighted the importance of
employee attitudes and expectations, informal work groups, norms and values and
participation in decision making as influencing performance – all these still central concepts
in various techniques of OD. Though there are divergent opinions and attitudes about the
nature and practice of OD, among its practitioners, a general consensus may be noticed
among them as to what the basic characteristics of OD are.

In any OD effort the totality of the organization is to be taken into account. Organization
being an integrated system of sub-systems, changes in anyone sub-system tends to have
consequences for the other sub-systems. The approach should be holistic either for

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identifying the need for change within or for planning and implementing a change, until the
intended change is absorbed in the total system, optimal collaboration, synergism and
efficiency cannot be obtained.

The theoretical body of knowledge underlying the concept and practice of OD is eclectic.
Recent developments in the area of behavioral sciences, especially Psychology, Sociology,
Anthropology etc., have influenced the OD thought and practice.

The intended changes in OD programmers may be carried out at any of the sub-system levels
such as:

• Organization structure
• Task accomplishment
• Work climate ( interpersonal and intercrop relations, work values )
• Methods of decision making and problem solving
• Technology.

The benefits of the planned effort to the organization are measured in terms of improvements
noticed in the performance of the sub-system where the change has been implemented,
related sub-systems that have an interface with the changed sub-system, and the organization
as a whole.

Intended changes in the organizational structure should be initiated on the basis of a study of
the existing structure – especially the formal relationships, span of control and functions
performed by each individual in the context of the others. The planned change may be on the
basis of what an in ideal structure should be like. A better approach would be to take into
cognizance of the felt needs of the role incumbents. The employees may be involved in

Identifying problems in the existing structure and also in evolving a strategy for change. Such
a participative approach would yield results as the employees are tuned to the intended
change.

Another approach to OD is at the micro level i.e., at the job level, while the above was at the
macro level. What is of concern is the designing of jobs for better performance. Job related
aspects such as authority, responsibility, activities the attitudes, expectations of the role
incumbents.

Research studies have shown that job attitudes and job satisfaction influence performance.
Jobs may be redesigned to provide variety and opportunities for satisfying higher order needs.
Jobs enlargement and job enrichment are the job design methods employed as part of OD
techniques.

OD practitioners also aim at improving the interpersonal climate. The work climate of
openness, trust and collaboration has positive influence on performance, while the climate of
suspicion, distrust and hostility result in low or mediocre performance. The climate should be
supportive, proactive and allow for opportunities to be creative and original.

Communication is the life of an organization and effective communication is basic to internal

work climate. OD efforts may be directed to identify the gaps and problems in the formal

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communication network and improve the communication process. Communication network
may be analyzed in terms of the following methods.

1. Residential analysis: It helps in understanding how a given organization really functions.

The analyst is a live observer of the communication process.

2. Participant analysis: Data is collected about how communication is actually taking place
in the network by interviewing the individuals or through a questionnaire.

3. Duty Study: Like a cop observing the traffic on a high way, the analyst positions himself in
the communication network at any spot and studies the communication flow.

4. Cross–section analysis: A time sampling of the communication process in the network

may be carried out. However, the sampling must be repeated to get sufficient data.

5. Episodic communication (channels in organization) analysis: A trace element (i.e.) a piece

of communication is left in the communication network and its flow through the network is
traced through time and space.

OD efforts to improve communication may deal with the elements of communication process
such as ‘surface’, ‘message’, ‘channel’, ‘receiver’, process of encoding and network, in
addition to communication overload.

Decision making and OD Intervention

Decision making is another important area for OD intervention. What is a decision? Decision
is ‘commitment to action’. Decisions are basic to management process and link up the
various activities of the organization. While some of the decisions are routine and
programmed, the other may be un-programmed and ad hoc. While some of them are
operating decisions that are routine, programmed and executed automatically, the others are
administrative decisions that are either coordinative and routine, or exceptional and ad hoc
while yield custom – made solution.

Strategic decisions are also exceptional and have an influence on the overall organization or a
greater segment of the organization. Necessity for strategic decision may arise due to forces
in the external or internal environment, new technological input or at the initiative of the
chief executive organizational settings. Its popularity arises out of its being a non-threatening,
practical and an enjoyable way of learning about self and people. T.A. is basically a
conceptual model for analyzing interpersonal behavior. Development of self-knowledge
comes through analysis of own behavior with the help of this model. The intervention
requires explanation of concepts through instructions, individual self-analysis and exercises
for group discussion. An innovative use of T.A. is its application to analysis of
“organizational scripts”, which make it an OD intervention for use tat the total organizational
level.

7. Barriers to Organizational Development

A common barrier to effective OD is a lack of understanding of what the term means and
how it can help Organisations deliver the cultural and organisational change needed for all
types of continuous improvement.

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In some cases it is assumed that OD sits within the Human Resources function or a particular
department rather than a corporate management responsibility that requires wide-ranging
organisational action. It may then be regarded as a territorial issue rather than a high level
strategic activity is therefore unlikely to be effective. The fact that OD is a cross-functional,
cross-role responsibility also means that it is not necessarily easy to identify, own or describe.

Some authorities may have capability gaps in some of the behaviours, skills and knowledge
required for successful OD. Vision and longer term planning are particularly critical in this
respect. If these are lacking, OD may not be properly thought through so that it becomes
unnecessarily complex, meets staff resistance and the council then fails to deliver its
objectives.

8. Integral Activities of Organizational Development

Many activities contribute to an appropriate ‘climate’ for sustained OD. For example:

1. Identification of key priorities and organisational purpose

2. Identification of key obstacles and how these might be overcome
3. Identification of key people management and development implications as the
organisation develops
4. Management of performance
5. Promotion of learning, development and the sharing of knowledge
6. Promotion of creativity and innovation
7. Ensuring staff, elected members and the wider community understand why the
organisation must develop and how they can contribute
8. Development of mechanisms for giving/receiving feedback and sharing ideas at all levels
within the organisation and with stakeholders
9. Establishment of processes for consultation/planning and evaluation

Creating an Organisational Development Coordinator (or some similar post) and a steering
group are both critical drivers to the process since they provide a focal point and an overview
to help ‘map’ all OD activities and to ensure ownership across the organisation.

A typical remit might include:

1. Assist the chief executive and senior management team in establishing/identifying

priorities for development and learning
2. Proactively identify OD and learning activities in the organisation and publicize these to
others
3. Manage OD knowledge across the organisation; being the information point for what is
happening across the organisation and outside
4. Manage relationships: bringing different parts of the organisation together to share
development activities
5. Set up task groups to undertake specific OD projects using a wide range of membership

9. The Critical Factors for Organizational Development

Organizational Development is a high level, strategic activity requiring strong leadership and
influence. Therefore, by definition, the chief executive and corporate management team’s
commitment to the concept of OD are critical if it is to be successful.

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In practical terms this means:

a. Matching of belief with action with a willingness to allocate resources to overcome

major political, bureaucratic and financial barriers to change
b. Making a deliberate attempt to avoid “initiative fatigue” by integrating all change
activities into one development programme
c. Identification and influence of key stakeholders, in particular ensuring that the map of
OD work is clearly linked to the achievement of council objectives and is well
communicated to staff and elected members throughout the process to show linkages
d. Identification and development of staff with the right skills to help ’champion’ OD
throughout the organisation
e. Encouragement of wide participation and ownership of the continuous improvement
process among staff and elected members
f. Challenge of existing practice and commitment to make difficult choices
g. Inclusion of the OD perspective at the earliest stage to ensure that changes are
grounded and sustainable with people aspects integrated into the process
h. Consideration of both ‘hard’ and ‘softer’ issues when contemplating any OD activities
i. Ensuring all levels of staff are enabled to contribute to continuous improvement

However, care must also be taken to ensure that OD is widely accepted and integrated within
the culture of the organisation as a whole to ensure maximum strategic benefit. This requires
authorities to identify the skills it needs to build organisational capacity and plan how these
will be developed or acquired.

Critical Organizational Development activities

Effective Organizational Development should form an essential part of an authority’s

strategic planning and implementation process, which will include a combination of both
"hard” and “softer” activities:

“Hard” activities

a) Strong managerial and political leadership

b) Identification of strategic goals and long term direction – using techniques such as
scenario planning
c) Evaluation of current organisational impact and performance in key areas – including
identification of strengths and weaknesses and predictions for the future
d) Challenging existing practice to ensure continuous improvement
e) Identification of organisational capability gaps and how they might best be filled –
including workforce planning
f) Re-modeling of structures, systems and tasks
g) Allocating sufficient resources to support implementation – including making difficult
choices about whether some existing operations should continue
h) Consultation with stakeholders
i) Motivation of staff to ensure “buy in” – by ensuring they are aware of why the
organisation needs to develop and keeping them involved in the change process
j) Identification of required shifts in culture and ethos
k) Identification and development of required behaviours, skills and knowledge

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“Softer” activities

a) Provide an overview of the projects being undertaken that make a contribution to the
development of the authority
b) Identify activities/projects that need to be undertaken to ensure that the authority is
developing as an organisation to meet its key objectives.
c) Provide advice on how organisational frameworks should/could be developed e.g.
Performance Management
d) Establish clear outcomes and measures to track and evaluate progress with regular reports
on OD to elected members, senior management, and departmental representatives
e) Identify and share good practice within the organisation
f) Identify what others are doing to develop their organisations and learn from their
experience

Therefore critical OD activities will:

Organizational Development currently located in the structure

OD function can be found in a wide range of locations, both corporately and departmentally
and many authorities may not have staff designated specifically to this role by name. Tasks
associated with OD may well be being carried out without full awareness, and piecemeal,
although the attempts at “cross silo working” may be raising awareness of the importance of
OD.

Common corporate locations for this function are:

Personnel Managers/Heads of HR Service

Heads of Corporate Resources/Resources

Best Value and Comprehensive Performance Officers

HR (strategic) consultants

Organisation Development Managers/Officers

Most of these posts tend to be located in the Chief Executive’s Department. In some
authorities these post holders are members of various teams, including strategic development
and change management groups. Other posts are held within HR support services or
corporate divisions. Some post holders report directly to the chief executive or senior
management team. Most OD Managers/Officers tend to report directly to heads of service
within their particular divisions

At departmental level, responsibility for OD is generally less well defined. In some

authorities no posts exclusively exist to promote OD, but some HR staff (often within
training), operational managers and strategic directors have some responsibility for OD.

It is not appropriate to specify exactly where the Organisation Development 'function' should
be located, as authorities will vary in both their structures and contexts. In principle it could
be anywhere in the authority structure, but the high level nature of OD activities requires

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clear links to the chief executive and the senior management team, with sufficient authority to
influence the whole organisation.

However, recent research indicates that authorities which have located their OD posts within
the Chief Executives’ Department has resulted in closer liaison with chief officers and chief
executives. This has helped form an overall vision of council activities and resulted in a
more flexible organisational response to wide ranging demands.

Authorities required to support Organizational Development

Those taking responsibility for driving the process of OD role will draw on a range of
behaviours, skills and knowledge such as:

Behaviours

a) Strategic focus
b) Visionary/anticipates future direction
c) Identifies push and pull factors in organisation
d) Communicates appropriately at all levels of organisation
e) Establishes rapport with a wide range of people
f) Identifies creative and innovative solutions
g) Leads from within and from behind
h) Challenges existing practice
i) Flexible in approach
j) Reflects on and learns from experiences of self and others
k) Patient and persevering
l) Inspires trust and confidence

Skills

a) Change management
b) Influencing
c) Negotiation
d) Relationship management
e) Knowledge management
f) Political and personal sensitivity
g) Performance and project management
h) Risk management
i) Analytical skills
j) Research techniques – surveys, focus groups
k) Team/partnership working

Knowledge

a) Overall context and own authority context

b) How service improvement will impact on organisation development
c) How different aspects of the organisation interrelate
d) Insight into how other organisations have managed change and development
e) Organisational change models/techniques/tools including:-

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Good OD and change management practice, business/scenario planning, organisational
re-modeling, the Balanced Scorecard, strategic applications of ICT, Business Process
Reengineering, partnerships, outsourcing, Knowledge Management, job/task re-design

Developing the behaviours, skills and knowledge for Organizational Development

The diverse range of behaviours, skills and knowledge required to carry out Organisation
Development activities effectively mean that it is most unlikely that these would be drawn
from a single source.

The possible range of options includes:

 National organisations
 Regional Organisations
 External training providers/organisations and consultants
 Internet and computer based development tools
 national networks
 Internal groups brought together with OD as focus
 Appointment of OD staff member at high level with expertise in key areas to help
develop others from within

10. Summary

Organizational Development is not a new concept; however until recently it has tended to be
implicit. The critical role of effective people management and development in successful OD
is often not fully recognized.

Many authorities are already carrying out a wide range of OD activities, but these are not
always explicit or centrally coordinated. Therefore moving towards a more holistic OD
approach may not require significant effort compared to the benefits this yields, even in the
short term. However, in other authorities a more radical approach to establish an OD focus
and greater appreciation of the ‘people’ dimension may well be required.

For the foreseeable future, Organisations will need to justify their position with the
community. The significant contribution of Organisation Development in this context should
be recognized and acted upon.

Self Study Questions

1. What do you mean by Organizational Development?

2. According to Richard Beckhard ‘OD is an effort to increase organizational effectiveness –
Discuss.
3. What are the main considerations of the two schools of thought on OD?
4. Explain the Objectives of OD.
5. What are the characteristic features of OD?
6. How would you analyse communication network?
7. Decision making is one of the important are for OD intervention – Explain.
8. Discuss various barriers to OD.
9. Explain the Integral Activities of OD.

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10. What do you understand by Hard and Soft activities?
Unit 2
HISTORICAL FOUNDATION OF ORGANISATIONAL DEVELOPMENT
Dr. D. Joseph Anbarasu

1. Introduction

Organizational development is one of the primary means of creating more adaptive

organizations. Warren Bennis, a leading OD practitioner, has suggested three factors
underlying the emergence of OD.

a. The need for new organizational forms. Organizations tend to adopt a form that is more
appropriate to a particular time, and the current rate of change requires more adaptive
forms.
b. The focus on cultural change. Because each organization forms a cultural system of
beliefs and values the only way to change is to alter this organizational culture.
c. The increase in social awareness. Because of the changing social climate, tomorrow's
employee will no longer accept autocratic styles of management; therefore, greater social
awareness is required in the organization. Today’s managers exist in shifting
organizational structures and can be the central force in initiating change and establishing
the means for adoption. Most organizations strive to be creative, efficient, and highly
competitive, maintaining a leading edge in their respective fields rather than following
trends set by others. Effective managers are vital to the continuing self-renewal and
ultimate survival of the organization. The Consultant manager must recognize when
changes are occurring in the external environment and possess the necessary competence
to bring about change when it is needed. The manager must also be aware of the internal
system and recognize that the major element in planned change is the organizational
culture: the feelings, norms, and behaviors of its members.

2. Historical Foundation of Organizational Development

2.1. The Emergence of OD

With the Knowledge Explosion and Technological Revolution, a lot of changes in our
environment, in our personal as well as organizational lives have become so inevitable. If one
is not ready to adapt to these changes, one has to be stagnant and become stinky and dissolve.
It is more true in the case of organizations. To be alive and growing, manager of any
organization has to keep pace with the changing environment. In other words, the
environmental forces require managers to implement comprehensive change programs. OD is
a system wide approach to change.

The phrase ‘Organizational Development’ was coined by Richard Beckhard in the middle of
1950s in his efforts to find a way to integrate the needs of the organization and those of the
individuals within the organization. Roben Blake and Jare Mouton (the originators of the
managerial grid), Harren Shepard (a leading OD consultant) may also claim such distinction.
It is generally conceded that the term OD has evolved from two basic resources: the
application of laboratory methods by National Training Laboratory (NTL) and the survey
research methods by the Survey Research Center, both methods pioneered by Kurt Lewin in
about 1945.

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However, the basic concept underlining Organizational Development is to improve
organizational improvement by modifying human behavior rather than technological
innovation, because without the committed involvement of human element all technology has
very little scope.

Organizational Development is one of the primary means of creating more adaptive

organizations. Warren Bennis, a leading OD practitioner has suggested three factors
underlying the emergence of Organizational Development.

a) The need for new organizational development forms. Organizations tend to adopt a form
that is more appropriate to a particular time, and the current rate of change requires more
adaptive forms.
b) The focus on cultural change. Because each organization forms a cultural system of beliefs
and values the only way to change is to change is to alter this organizational culture.
c) The increase in social awareness. Because of the changing social climate, tomorrow’s
employee will not accept autocratic styles of management. Therefore, greater social
awareness is required in the organization. Today’s managers exist in shifting
organizational structures and can be the central force in initiating change and establishing
the means for adoption. Most organizations strive to be creative, efficient, and highly
competitive, maintaining a leading edge in their respective fields rather than following
trends set by others.

Effective managers are vital to the continuing self-renewal and ultimate survival of the
organization. The consultant manager must recognize when changes are occurring in the
external environment and possess the necessary competence to bring about change when it
is needed. The manager must also be aware of the internal system and recognize that the
major element in planned change is the organizational culture, the feelings, norms and
behaviour of the members.

2.2. Historical Evolution of Organizational Development

In their contribution to the book entitled “ORGANIZATION 21C” edited by veteran

management trainer, Subir Chowdhury and others, Noel M. Tichy and Christopher DeRose
under the heading ‘The Death and Rebirth of Organizational Development” trace the
historical evolution of OD under the following phases:

1. Conception Phase (from late 1950s to 1963)

2. Pioneering Phase (from 1964 to 1973)
3. Self-doubt Phase (from 1973 to early 1980s)
4. Rebirth Phase (from 1980 to the present)

Conception Phase (from late 1950s to 1963)

The roots of OD draw on the work from the late 1940s, when a group of Kurt Lewin’s MIT
researchers lead by Morton Duetsch, ran a workshop in New Britain, Connecticut, on race
relations. In the process they discovered “experiential learning” or the examination of group
and individual behavior in the ‘here and now’ to draw conclusions about group dynamics and
individual behaviors. This led to the launch of NTL at Bethel, where Training Groups and
sensitivity training started in 1948. By the end of 1950s, a number of NTL leaders focused
increasingly on taking the applied behavioral sciences in to organizational settings. Early

15
efforts by Richard Beckhard and Herb Shepard at Esso Research and Engineering, laid the
foundation for later developments in the field. Others at the time began calling their
consultation work “Organizational Development”; most notably, Robert Blake and Jane
Mouton. By the early 1960s, OD group had emerged at major corporations such as Union
Carbide, Bankers Trust Company, TRW and Esso.

Pioneering Phase (1964 to 1973)

By 1964, leadership began to emerge in the field of OD. Researchers and Consultants such
as Richard Beckhard, Warren Bennis Jane Mouton, Edgar Shien, Mathew Miles, Ronald
Lippitt, Robert Blake and Herb Shepard conducted key training, consulting and research
proposals in the filed of OD. There was a missionary zeal coupled with a spirit de corps. The
mid 1960s witnessed an improvement of the NTC Institute programs for specialists in OD as
well as the creation of the creation of graduate programs. By late 1960s, many organizations
had developed their own separate internal OD staff/and special departments. There was
increased interest among academics who had come out with literature.

These literatures are of two streams, both of them tracing their origin to the Concept phase of
1950s. While one stream focused on interpersonal relationship and humanistic psychology,
the second stream emphasized organizations as systems. In a sense this stream stressed
dynamics of the change process, work processes and structural changes.

The combination of these two streams in OD contributed to a phenomenon that Andrew

Pettigrew identified as the ‘simple most pervasive source of tension’ in pioneering an
innovation – the tension between the missionaries and the pragmatists, where the pragmatists
adopted system change, and the missionaries taken to humanistic psychology. Ultimately
O.D. became clearly identified with pragmatists.

Self-doubt Phase (from 1973 to early 1980s)

This period is called so because, during this period only the movement of OD was
marginalized so much. From 1973 to early 1980s, was a period which witnessed significant
social changes in the background of the economic recession. This led to the general loss of
interest in OD activities. There was also a kind of disapproval for OD practitioners who tried
to forge a more meaningful organizational life. In 1978, Noel M. Tichy found that the field
was largely dwindling downward. There was no support to OD practitioners.

A study in this regard revealed that OD would be further marginalized. The need for
revitalizing OD into the mainstream of Organizational Effectiveness was felt. It was the US
Army, which realized the need very much. They established a Department of Organizational
Effectiveness to train its officers before they were actually assigned important responsibility.
It had a very good impact. The trained officers were able to integrate OD practices into their
operating roles. On the contrary, the corporate sector gradually eliminated OD practices.

Rebirth Phase (from 1980s to present)

Such a marginalized and downgraded OD was given rebirth by the strong proponent of the
term OD, Jack Welch. As the Chairman and CEO of General Electric (GE) company, during
1980s. He, having been convinced of the impact of OD processes in the US Army, expanded
upon the Army model and demonstrated how to incorporate the same into the leadership
repertoire of GE workers. Thus finally OD found its place in the mainstream leadership of
leading companies. It was possible only because of the series of steps taken by Welch, which
were later emulated by companies the world over.

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How did it happen?
1. Action Learning Program at GE Crotonville Development Institute
On his attempt to reinvent the OD process, Welch invited Noel M.Tichy to head GE at
Crotonville. Noel’s effort here was a shift towards action learning program at the
Development Institute that took GE’s developmental efforts away from traditional study and
case research. The movement towards action learning was that a meaningful cultural change
would occur only when people brought new work approach into their daily routine. This was
what Welch wanted to take place.

The Tichy Development Matrix given below demonstrates this idea:

Depth of Change
Deep Superficial
High Risk Low Risk
Long Time Little Time

Developing Developing Developing Developing Developing

Fundamental New Problem - Skills Cognitive Awareness
Change Solving Understanding

Organisation Required
Approach: Action-Learning

Team

Pair Traditional
Approach

Individual

Target of change

Deep High Long

Risk Time

Super Low Little

Risk Time

Ultimately GE Crotonville has become a centre of blending traditional management approach

and the latest OD approaches.

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18
2. Work-out concept
However, Welch was not satisfied with the speed at which the cultural change was taking
place in the organizations. He wanted people to be liberated from bureaucracy and empower
them to work in an open and collaborative spirit.

Work-out is a fluid and adoptable concept and not a program. It started as regular meeting of
the cross section of the employees of different departments of the same organization. The
basic idea is to remove any barrier like bureaucracy, monotonous paper work, etc which
hamper the fast moving of things in an organization. The result was so admirable that things
moved fast and people were convinced of its effectiveness.

Progressively the Work-out session started taking up more challenging tasks of identifying
the crucial issues of the organization, discarding the lesser important ones, and finding a
faster, simpler and better way. Work-out was not designed to increase productivity but to
create a positive, high-energy process that made the managers to collaborate with employees
to constructively change work routines. Initially, Work-out was run by a team of external
consultants. Though GE did not call this as OD, it advocated large-scale adoption of OD
principles and methodology at a crucial time.

3. Change Acceleration:
At this point of time, Welch shifted the work-out process from the external consultants to the
line managers of GE itself. The line managers had acquired the necessary skills to sustain the
work-out process on a daily basis. Further he went on to create a team of change agents and
launched Change Acceleration Program (CAP) to give GE leaders, the change agents’ skills,
organizational diagnostic capabilities, skill in designing workshop interventions and basic
team building.

4. Redefining Leaders as Teachers:

By mid 1990s, the much needed cultural transformation was well established. At the same
time, Roger Enrico, Chairman and CEO of PepsiCo., was engaged in developing a leadership
program. He was personally doing it. He himself was teaching and conducting workshops
and coaching every participant. He was practically using the lessons learnt at GE with certain
desired improvement. Enrico translated his experience into models and teaching points.
From this Welch understood the importance of leaders to be teachers. He did try this idea at
GE.

The Action Learning projects had launched an awareness of the need for line managers to use
OD skills. Work-out and CAP developed these skills in leaders, eventually this replaced the
consultants with experienced in-house leaders as teachers. Embedding leaders as teachers at
Crotonville was a natural next step for ensuring that the line leadership was able to develop
the people capabilities requires for the success of GE.

Their final phase was the launch of six sigma, a quality program aimed at producing fewer
than three defects per million. Welch took the six sigma process, teaching organizational
statistical tools, process mapping and problem solving tools to a new level by building the
world’s largest team of teachers (12,000).

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5. Dissemination of GE Model:
Welch retired in 2001. However he left a mark in GE. The total absorption of OD in to the
line leadership’s daily responsibilities is certainly a key element that it brought culture
change in the organization and an internal army of change agents-leaders.

OD’s rebirth is in the mainstream of how good leaders can develop other leaders within and
the organization itself. Welch’s conviction is that ‘leaders must be teachers’ and they must
have a teachable point of view regarding how to develop a successful organization and how
to energize its employees. Thus, Jack Welch was very rightly considered as the father of the
rebirth of OD.

Case study

MAKING SOMETHING HAPPEN AT THE SCHOOL BOARD

Upon graduation, you take on what you quickly realize is the job challenge of a lifetime –
you go to work for the city school board of a large metropolitan area that is noted for
problems with its school system. You are in a staff position. Officially, your title is Staff
Analyst, Special Project. You ask your boss what some of the special projects are expected
to be.

What you need to understand is that our staff is new and that we’re in a place to make some
real changes. The mayor is really alarmed. You know, of course, that businesses in the city
just lost a major contract for some work for the federal government. I’m sure that you’ve
heard the “official” position as well – that the low bid by Amalgamated Industries was the
main reason. Well, the mayor’s inside information is that the bid wasn’t the main factor. The
main factor is the state of education in this city. It’s so bad that we aren’t considered to have
an educated workforce. The mayor, the governor-everybody is determined that we must
make an all-out effort to radically and totally revamp the entire public school system in this
city to ensure that this never happens again. Your job will be to do the research that is
needed to get things going.

You go home with a terrible headache and are worried that you’re in way over your head – or
anyone’s head, for that matter. But the next morning you’re feeling somewhat refreshed and
decide to give it a try.

When you get to work the next day, the boss pulls you aside.

Now I’ve really got a tough assignment for you. I want you to try to persuade one of the
district administrators to turn over control of one of the elementary schools to us so that we
can run a study of a new experiential reading curriculum. You’ve got to do it – the guy won’t
even speak to me. The problem is that this particular administrator, John Harold, is strictly
from the Stone Age. He’s one year away from retirement and hasn’t entertained a new idea
in at least twenty years. Anyhow, give it a go. You’re our last hope.

You aren’t too optimistic, but you agree to try.

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Case Questions

1. What can you, as a manager, do to get the new program accepted?

2. Suppose you determine that there is a need to change the organisation as a whole (a
complete overhaul). How could OD be used in this situation? What steps would you
take? Who should be involved?

3. Laboratory- Training methods

In the late I940s and early 1950s laboratory-training methods were developed and applied by
a group of behavioral scientists at Bethel, Maine. Douglas McGregor (Theory X and Theory
Y with Richard Beckhard, began applying laboratory-training methods to industry, at General
Iills in 1956 and at Union Carbide in 1957. At union Carbide, McGregor and John Paul Jones
(an internal consultant) formed the first internal OD consulting group. About the same time
Herbert Shepard and Robert Blake were initiating a series of applied behavioral Science
interventions at Esso, using mainly laboratory-training technique to improve work team
processes. These early railing sessions provided the basis for what Blake and Mouton later
developed as an instrumented training system they called the Managerial Grid. The success of
these programs led to a dissemination of such efforts to her corporations.

4. Survey Research Feedback

At the same time, a group at the Survey Research Center at the University of Michigan began
to apply to Organizations the action research model of Kurt Lewin. Rensis Likert and Floyd
Mann administered an organization-wide survey to “Detroit Edison Co" involving the
systematic feedback of data to participating departments. They used what is termed an
"interlocking series of conferences" feeding data back to the top management group and then
down to work teams throughout the organization. Since that time, many organizations have
used the survey feedback approach. General Motors, for example, has reported success in
applying Likert's survey feedback approach to organizational improvement.

In summary, the major sources of current OD practice were the pioneering work at NTL
(laboratory-training techniques) and the Survey Research Center (survey feedback methods).
This brief look at the past is important because OD is a new and still developing field, and
you as a future OD practitioner may build upon these earlier foundations in pioneering other
new approaches.

5. The Extent of OD Applications

From these early beginnings OD has experienced a rapid growth. A growing number of
organizations worldwide applying OD techniques, including most major corporations, have
formed internal OD consulting groups. The OD network, an organization of OD practitioners,
has been in existence for only a little over two decades and has grown to a membership of
more than 2,000 members. The National Training Laboratories, American Psychological
Association, American Society for Training and Development, and Academy of Management
all have professional divisions relating to organization development. The first doctoral
program for training OD specialists, called the Organizational Behavior Group, was started
by Shepard in 1960 at what is now the Department of Organization and Administration at
Case Western Reserve University. Shepard applied these OD techniques, in an educational
setting, to the development of OD practitioners. The Organizational Behavior group has since

21
graduated over 100 specialists who are involved in teaching and consulting throughout. Other
universities with graduate programs bearing on OD include Brigham Young, Harvard, MIT,
Southern, Methodist, UCLA, University of Washington, Gonzaga, Pepperdine, and Yale,
with many others beginning to include OD in the curriculum. Organization development is an
exciting rapidly growing field. OD efforts have grown into a multitude of differing
approaches and are now applied in a number of organizations around the world by expanding
number of OD practitioners.

6. OD and TQM

As change is occurring so rapidly, there is a need for new way to manage focusing on product
quality and individual involvement. Total Quality Management is an approach to managing
work focusing on the evaluation work processes; the development of a quality energized
culture; and the empowerment of employees, for the purpose of continuous improvement of
products and services. Since TQM is a powerful new management technique requiring
increased employee participation, the first step is a dramatic change in corporate culture. Any
successful change in corporate culture will depend upon the active consultation and
involvement of the management team.

7. The Organization Culture

The element of an organization system which a manager needs to understand is the

organization culture. The term culture refers to a specific civilization, society, or group that is
its distinguishing characteristics.

As B. F. Skinner has commented, "A culture is not the behavior of the people 'living in it'; it
is the 'it' in which they live-contingencies of social reinforcement which generate and sustain
their behavior.”

The organization culture refers to a system of shared meanings, including the language, dress,
patterns of behavior, value system, feelings, attitudes, interactions, and group norms of the
members. You may examine the patterns of behavior on your campus or in your company.
How do people dress or wear their hair? What jargon or unique terms are used these are the
elements that make up a culture: the accepted patterns of behavior. One example is the
culture at Federal Express, carefully crafted by Frederick Smith, the chairman, to reflect a
combat situation. Flights are called “missions" and competitors are "enemies."

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 Chart 1

8. The Experiential Approach to Learning

To learn OD techniques, a manager or student needs both the knowledge of content material
and the Experience of putting theory into practice. Consequently, to create a learning
environment for the field of Organization development at either the undergraduate or
graduate level, the emphasis should be on experience.

You will perhaps discover a different approach to the study of organizational change. Many
courses in OD approach change in a structured and traditional manner. By means of lectures
and readings, useful concepts and theories are presented to the student, whose role is largely
passive. This book utilizes an innovative and significantly different approach to teaching OD:
the experiential approach. It is used on learning OD techniques experiencing simulated
organizational situations. You will experience situations in which you are developing
relationship with a client or diagnosing a problem rather than simply reading about them.

9. Basic Concepts of Experiential Learning

Experiential learning is based upon three basic concepts:

You learn best when you are involved in the learning experience. Concepts have to be
experienced or discovered by you. They are to change your behavior. Your commitment to
learning will be greatest when you are responsible for setting your own learning objectives.
In the experimental approach, the major responsibility for learning is placed upon you, the
learner. You will determine your own learning objectives and influence how the class goes
about achieving these objectives. You attain your own goals, decide which theories you want
to learn, practice the skills or techniques you want to improve. You develop the behavioral
style you want to develop experiential learning also involves an active, rather than a passive
role. Often you may sit in a class, listen, take notes, or perhaps daydream while the instructor
"does his or her thing" for an hour. As in a job situation, you are dependent on others and
they upon your ideas, factions, and feedback about behavior: The same will be true in this
class. Experiential learning is also the method most corporations use to teach OD concepts to
their employees. So, you will be experiencing the same kind of activities that occur in most
real world OD programs.

23
What is different about the experiential learning process? First, you will generate from your
own experience in this a set of concepts that will guide your behavior. These concepts will be
continually modified over time and in various managerial situations to improve your
effectiveness. The experiential learning program can be presented in a four-stage cycle

1. Gaining conceptual Knowledge and Theories: You will be reading about OD concept;
and theories and doing pre class preparation.

2. Activity in behavioral simulation: You will be problem solving, making decisions,

and communicating, actively practicing the concepts and theories.

3. Analysis of Activity: You will be analyzing, critiquing the way you solved problems,
and comparing the results of different approaches.

4. Connecting the theory and activity with prior on-the-job or life situations-You will be
connecting your learning past experiences reflecting upon the results, and
generalizing into the future. The end result should be proved skill and performance in
applying; these learning are to 1ife and job situations. “Student centered" learning
places a learning responsibility upon you. There will be an opportunity in the class for
a high level of participation and for a challenging learning experience. Small-group
learning environments will be formed wherein you may share learning with others,
thus encountering feedback. Each of the learning-units presents a conceptual
background and a framework for a behavioral simulation. The focal point for each
chapter is the action-oriented behavioral simulation. As part of the experiential
learning model in OD, feelings, and emotions represent important data for learning.
open and authentic relationships in which you share your feelings with others and
provide honest feedback are necessary part of the learning situation. Each chapter is
organized to help you learn concepts and skills, and each provides cases, simulations,
and diagnostic instruments to help you learn more about OD. Although experimental
learning can be stimulating and often fun, it is important to remember that you learn
from the combination of theory and experience.

10. Conclusion
Organization development emerged largely from applied behavioural sciences and has four
major stems:

a. the invention of the T-group and innovations in the application of laboratory training
insights to complex organisations;
b. the invention of survey feedback technology,
c. the emergence of action research and
d. the evolution of the socio-clinical approaches.

Key figures in this early history interacted with each other across these stems and were
influenced by concepts and experiences from a wide variety of disciplines and settings. These
disciplines included social psychology, clinical psychology, family group therapy,
ethnography, military psychology and psychiatry, the theater, general semantics, social work,
systems theory, mathematics and physics, philosophy, psychodrama, client-centered therapy,
survey methodology, experimental and action research, human resources management,
organisational behaviour, general management theory, and large conference management.

24
Self Study Questions:

1. Discuss the emergence OD in the context of the three factors suggested by Warren
Bennis.
2. What are the different phases of the historical evolution of O.D?
3. Describe the growth of OD Process during the Pioneering phase.
4. Explain why the period from 1973 to 1980s was called Self-Doubt phase.
5. What is contribution of Jack Welch for the rebirth of OD process?
6. Explain the change process that took place in GE.
7. What is Tichy’s Development Matrix?
8. Explain the “Work-Out” concept.
9. What do you understand by ‘CAP’?
10. “A Leader must be a Teacher” – Discuss.
11. Briefly analyse the laboratory techniques that were adopted at NTL.
12. Explain what Organizational Culture is.
13. What do you understand by Experiential Learning?
14. The concept OD has emerged from behavioural sciences – Explain.

Suggested References:

1. Richard Beckhard: Organizational Development: Strategies and Models, (1969)

2. Edgar Huse: Organization Development: (1980)
3. Warren Bennis: Organization Development - Its Nature, Origin and Prospects; (1960)
4. Wendell French and Cecil H. Bell: Organization Development; (1973)
5. Jit S. Chandan: Organizational Behaviour; (2005)
6. Stephen P. Robins: Organizational Behaviour; (1996)

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