Module 2

Introduction

“Everybody has accepted by now that change is unavoidable. But that still implies that change is like
death and taxes—it should be postponed as long as possible and no change would be vastly
preferable. But in a period of upheaval, such as the one we are living in, change is the norm

Organisational Development (OD) comprises of a special set of organisational change methods. It is a

planned, systematic process of organisational change based on behavioral science research and
theory. The goal of OD is to create adaptive organisations capable of transforming and reinvesting
themselves so as to remain effective. OD draws from psychology, sociology and anthropology. It is
based on many well established principles regarding the behavior of individuals and groups in the
organisations

Definition of Organization Development

Organisation development is a system-wide application of behavioral science knowledge to the

planned development and reinforcement of organisational strategies, structures, and processes for
improving an organisation’s effectiveness. (Cummings and Worley, Organisation Development and
Change, Sixth Edition, South-Western Publishing, 1997, p.2.)

Organisation development, according to Richard Beckhard, is defined as:

 A planned effort

 Organisation-wide

 Managed from the top

 To increase organisation effectiveness and health

 Through planned interventions in the organisation’s ‘processes’, using behavioral

science knowledge.

According to Warren Bennis, Organisation Development (OD) is a complex strategy intended to

change the beliefs, attitudes, values, and structure of organisations so that they can better adapt to
new technologies, markets, and challenges

Nature and Scope of OD.

OD is a Long-term Effort: which means that organisational change and development take

long time in fact it is a never ending journey of continuous change for organisation

effectiveness.

2. Supported by Top Management: The OD programmers seeks the serious attention and
commitment from the top management for achieving it’s objectives of improvements.

3. OD is a Learning Process: which means the process of interaction, listening and selfexamining
which facilitates individual, team and organisational learning.

4. OD is visioning Processes: which mean the organisation members develop a picture of the

desired future that includes the humanistic approach to make that picture a reality.

5. OD is an Empowerment Process: which means those leadership behaviors and human

resource practices that enable organisation members to develop and use their talents as

fully as possible towards organisational growth and success.

6. Contractual Relationship: Although neither the sponsoring organisation nor the change

agent can be sure at the outset of the exact nature of the problem or problems to be dealt

with or how long the change agent’s help will be needed, it is essential that some tentative

agreement on these matters be reached. The sponsoring organisation needs to know

generally what the change agent’s preliminary plan is, what its own commitments are in

relation to personal commitments and responsibility for the program, and what the change

agent’s fee will be. The change agent must assure himself that the organisation’s, and

particularly the top executives’, commitment to change is strong enough to support the

kind of self analysis and personal involvement requisite to success of the program.

Recognizing the uncertainties lying ahead on both sides, a termination agreement

permitting either side to withdraw at any time is usually included.

7. Change Agent: A change agent in the sense used here is not a technical expert skilled in

such functional areas as accounting, production, or finance. He is a behavioral scientist

who knows how to get people in an organisation involved in solving their own problems.

His main strength is a comprehensive knowledge of human behavior, supported by a

number of intervention techniques. The change agent can be either external or internal to

the organisation. An internal change agent is usually a staff person who has expertise in

the behavioral sciences and in the intervention technology of OD.

Notes Beckhard reports several cases in which line people have been trained in OD and

have returned to their organisations to engage in successful change assignments. In the

natural evolution of change mechanisms in organisations, this would seem to approach

the ideal arrangement.

Qualified change agents can be found on some university faculties, or they may be private

consultants associated with such organisations as the National Training Laboratories

Institute for Applied Behavioral Science Washington, or University Associates (San Diego,

California), and similar organisations.

The change agent may be a staff or line member of the organisation who is schooled in OD

theory and technique. In such a case, the “contractual relationship” is an in-house agreement

that should probably be explicit with respect to all of the conditions involved except the

fee.

8. Sponsoring Organisation: The initiative for OD programs comes from an organisation

that has a problem. This means that top management or someone authorized by top

management is aware that a problem exists and has decided to seek help in solving it.

There is a direct analogy here to the practice of psychotherapy: The client or patient must

actively seek help in finding a solution to his problems. This indicates a willingness on the

part of the client organisation to accept help and assures the organisation that management

is actively concerned.

9. Applied Behavioral Science: One of the outstanding characteristics of OD that distinguishes

it from most other improvement programs is that it is based on a “helping relationship.”

The change agent is not a physician to the organisation’s ills; he does not examine the

“patient,” make a diagnosis, and write a prescription. Nor does he try to teach organisational

members a new inventory of knowledge which they then transfer to the job situation.

Using theory and methods drawn from such behavioral sciences as psychology, sociology,

communication, cultural anthropology, organisational behaviour economics, and political

science, the change agent’s main function is to help the organisation define and solve its

own problems. The basic method used is known as action research. This approach, which

is described in detail later, consists of a preliminary diagnosis, collecting data, feedback of

the data to the client, data exploration by the client group, action planning based on the

data, and taking action.

10. System Context: OD deals with a total system — the organization as a whole, including its

relevant environment — or with a sub-system or systems — departments or work

groups — in the context of the total system.

Historical Perspective of Organization Development

In a little over five decades, OD has evolved a complex and diverse body
of knowledge and practice. Because this expertise derives mainly from
helping organizations change and improve themselves, the history of OD
can be understood in terms of the kinds of changes that organizations have
implemented over this time period. These include changes aimed at:

(1) Social processes;

(2) Work designs;

(3) Human resources; and

(4) Organization structures.

Although these changes are interrelated, each represents a distinct
background in the growth of OD.

1. SOCIAL PROCESSES

The earliest applications of OD involved helping organizations improve

social processes including relationships among members, communication,
group decision-making, and leadership. These process changes started in
the early 1950s and were largely in response to emerging social problems
that organizations experienced as they became larger and more
bureaucratic. During the first half of the twentieth century, organizations
grew increasingly large with numerous departments, levels of
management, and rules and procedures. Management was largely
responsible for commanding and controlling the enterprise typically in an
authoritarian or paternalistic manner.

Over time, these organizational conditions generated a host of unintended

social problems as members found it increasingly difficult to communicate
both laterally and vertically, to resolve problems within and across groups,
and to respond energetically to managerial directives. OD‟s response to
these social problems started in the late 1940s with the work of Kurt Lewin
and his colleagues in laboratory training. Bradford (1967) began with a
training program for community leaders which included both cognitive
learning about leadership as well as informal feedback about participant
behaviour
2. WORK DESIGNS
This branch of OD history involves designing work to make it more motivating and fulfilling.
Traditionally, work was designed to promote technical rationality, resulting in jobs that were
highly specified, fragmented, and repetitive. In the 1960s, the benefits of such work designs
came more and more under question. Employees complained that work was boring and
meaningless; they felt alienated from their jobs and the organizations that employed them.

Organizations experienced growing problems with absenteeism, turnover, quality, and

productivity. These problems spawned widespread calls for government, labor, and business to
work jointly to improve the quality of the work life of the employees.

OD sought remedies for these problems in new work designs that were more geared to employee
needs and aspirations than to traditional designs. These interventions were based on the work of
Eric Trist and his colleagues in socio-technical systems and of Frederick Herzberg and his
colleagues in job enrichment.

3. HUMAN RESOURCES

This background of OD involves integrating people into organizations so they join, remain, and
produce at high levels. Concern for human resources has traditionally been associated with the
personnel function in organizations. OD‟s interest in human resource practices grew rapidly,
many organizations faced serious global competition for the first time. They needed to produce
at higher levels at lower costs. People generally do those things for which they are rewarded;
rewards can play a powerful role in promoting performance.

Based on the work of Lawler (1981) , OD examined how rewards affect organization
performance , this led to interventions aimed at making rewards more contingent on
performance. One method that has grown in popularity over the past two decades is called „gain
sharing‟. It involves paying organization members a bonus based on measurable gains in
performance over some baseline standard
4. ORGANIZATION STRUCTURES

The most recent applications of OD involve structuring organizations so they

are better aligned with their strategy and environment. Such largescale change
has become more prevalent in the past two decades as organizations have
increasingly faced complex, rapidly changing environments that often demand
radical changes in how they compete and design themselves (Mohrman et al.,
1989).

To help organizations make these transformations, OD has expanded its focus

to the total organization and its competitive environment. Drawing on a
variety of perspectives in corporate strategy (Miles & Snow, 1978; Porter,
1980; Hamel & Prahalad, 1994; Grant, 1998), OD has created interventions
for assessing an organization’s competitive situation and making relevant
changes in strategy if necessary.

This typically includes a so called „SWOT analysis‟ where the organization‟s

strengths and weakness are compared to opportunities and threats in its
competitive environment. Then, a strategy is created to build on the strengths
and to take advantage of the opportunities, while accounting for the
weaknesses and threats.

Early Development

The history of organisation development is rich with the contributions of

behavioral scientists and practitioners. Systematic organisation development
activities have recent history. Kurt Lewin played a key role in the evolution of
organisation development as it is known today. As early as World War II,
Lewin experimented with a collaborative change process (involving himself as
consultant and a client group) based on a three-step process of planning,
taking action, and measuring results. This was the forerunner of action
research, an important element of OD, which will be discussed later. Lewin
then participated in the beginnings of laboratory training, or T-Groups, and,
after his death in 1947, his close associates helped to develop survey-research
methods at the University of Michigan. These procedures became important
parts of OD as developments in this field continued at the National Training
Laboratories and in growing numbers of universities and private consulting
firms across the country.

Systematic organisation development activities have a recent history and, to

use the analogy of the mangrove tree, have at least four important trunk stems.
They are as follows:

Laboratory Training Stem: Laboratory training began to develop about 1946

from various experiments. It is importantly involving unstructured small group
situations in which participants learn from their own actions and the group’s
evolving dynamics. The major contributions to this concept were from
behavioural scientists Kurt Lewin followed by experts Robert Tannebaum,
Chris Argyris, Douglas Mc Gregor, Herbert Shepard, Robert Blake, Jane
Mouton and Richard Beckhard.

Survey Research and Feedback Stem: It is the second major stem in the
history of Organisation development. It involves a specialised form of
organisation research. The research was conducted for years by staff members
at the Survey Research centre of the University of Michigan. The
effectiveness of these studies were more than the traditional training courses
as it involved the system of human relationships as a whole and deals with
each manager, supervisor, and employee in the context of his own job, his
own problems, and his own work relationships.

Action Research Stem: Action research is the third stem which is a

collaborative, client consultant inquiry. The scholars and practitioners who
have invented and utilized action research in the evolution of OD were
William F. Whyte and Hamilton. Kurt Lewin also conducted several
experiments in the mid 1940’s and early 1950’s. This approach, today is as
one of the most important methods for OD interventions in organisations.

Socio Technical and Socio-clinical Stem: This is the fourth stem in the
history of OD to help groups and organisations. The major contributions were
made by W.R. Bion, John Richman, Eric Trist and others. The socio technical
approach focussed on the non executive ranks of organisations and especially
the redesign of work.

Modern Development – Second Generation OD

In recent years, serious questioning has emerged about the relevance of OD to

managing change in modern organisations. The need for “reinventing” the
field has become a topic that even some of its “founding fathers” are
discussing critically. Since the environment is becoming turbulent the context
of OD has dramatically changed throughout 1980’s and 1990’s. The second
generation OD has focus on the Organisational Transformation, Organisation
culture, Learning organisations, intensified interest in teams, Total Quality
Management (TQM), Quality of work life, etc

SYSTEM APPROACH/ THEORY:

It came into existence in 1960. This approach was developed by

[Link], Herbert .A. Simon and their colleagues System approach
means a group of small interrelated units.

MEANING:

 The system approach is top took upon management as a system or as “an

organized whole” made up of sub- systems integrated into a unity or
orderly totality.
  A system is composed of related and dependent element which when in
interaction, forms a unitary whole. A system is simply an assemblage
or combination of things or parts forming a complex whole.

 System approach considers the organisation as a dynamic process

 Inter-related set of parts
 System approach integrates goals of different parts of the organisation
(sub-systems or departments) with the organisation as a whole.
 System approach enables organizations to frame policies that promote
business objectives and social objectives

FEATURES OF SYSTEMS THEORY

The major purpose of systems theory is to develop unifying principles by the

integration of various sciences, natural and social. With focus on the structures
and functions of the system, the system can be viewed from different
perspectives:

 Open system: a system keeps evolving and its properties keep emerging
through its interaction with environment
 Holistic view: systems theory focuses on the arrangement of and relations
between the parts that connect them into a whole. The mutual interaction
of the parts makes the whole bigger than the parts themselves

 Goal-directedness: systems are goal oriented and engage in feedback with

the environment in order to meet the goals. Also, every part of the system
is interdependent with each other working together toward the goals.

 Self-organizing: productive dynamic systems are self-organizing. It

implies the adaptive ability of the systems to the changes in the
environment. Using a metaphor of social interaction, Pask (1975, 1984)
described the self-organizing process as "a conversation between two or
more participants, whose purpose is to arrive at "an agreement over an
understanding."

ELEMENTS OF A SYSTEM
 Advantages of Systems Approach

 It concentrates on end results rather than the means.

 It provides an orderly and efficient plan of action.

 It develops coordination of the specialized activities.

 It provides a good basis of control

 It frees management from many daily details of operations management.

Disadvantages

Dependency

Expensive

Time consuming

Continuous
monitoring

The Growth and Relevance of OD:

Organizations must adapt to increasingly complex and uncertain
technological, economic, political, and cultural changes. The rapidly
changing conditions of the past few years have shown that the organizations
are in the midst of unprecedented uncertainty and chaos, and nothing short
of a management revolution will save them. Three major trends are shaping
change in organizations: globalization, information technology, and
managerial innovation.

First: globalization is changing the markets and environments in which

organizations operate as the way they function. New governments, new
leadership, new markets, and new countries are emerging and creating a
new global economy. The toppling of the Berlin Wall symbolized and
energized the reunification of Germany: entrepreneurs appeared in Russia,
the Balkans, and Siberia as the former Soviet Union evolves, in fits and
starts, into separate, market-oriented states; and China emerged as an open
market and as the governance mechanism over Hong Kong to represent a
powerful shift in global economic influence.

Second: information technology is redefining the traditional business model

by changing how work is performed, how knowledge is used, and how the
cost of doing business is calculated. The way an organization collects, stores,
manipulates, uses, and transmits information can lower costs or increase the
value and quality of products and services. Information technology, for
example, is at the heart of emerging e-commerce strategies and
organizations. [Link], E-Trade, are among many recent entrants to the
information economy, and the amount of business being conducted on the
Internet is projected to grow at double-digit rates for well over ten years.

Moreover, the underlying rate of innovation is not expected to decline.

Electronic data interchange, a state-of-the-art technology application a few
years ago, is now considered routine business practice. The ability to move
information easily and inexpensively throughout and among organizations
has fueled the downsizing, delayering, and restructuring of firms. The
Internet and the World Wide Web have enabled a new form of work known as
telecommuting; organization members can work from their homes or cars
without ever going to the office. Finally, information technology is changing
how knowledge is used. Information that is widely shared reduces the
concentration of power at the top of the organization. Organization members
now share the same key information that senior managers once used to
control decision making.

Ultimately, information technology will generate new business models in

which communication and information sharing is nearly free.

Third: managerial innovation has responded to the globalization and

information technology trends and has accelerated their impact on
organizations. New organizational forms, such as networks, strategic
alliances, and virtual corporations, provide organizations with new ways of
thinking about how to manufacture goods and deliver services. The strategic
alliance, for example, has emerged as one of the indispensable tools in
strategy implementation. No single organization, not even IBM, Mitsubishi, or
General Electric, can control the environmental and market uncertainty it
faces. Sun Microsystems’ network is so complex that some products it sells
are never touched by a Sun employee. In addition, new methods of change,
such as downsizing and reengineering, have radically reduced the size of
organizations and increased their flexibility, and new large-group
interventions, such as the search conference and open space, have
increased the speed with which organizational change can take place.
Managers, OD practitioners, and researchers argue that these forces not only
are powerful in their own right but are interrelated.

Their interaction makes for a highly uncertain and chaotic environment for
all kinds of organizations, including manufacturing and service firms and
those in the public and private sector. There is no question that these forces
are profoundly affecting organizations. Fortunately, a growing number of
organizations are undertaking the kinds of organizational changes needed to
survive and prosper in today’s environment. They are making themselves
more streamlined and nimble and more responsive to external demands.
They are involving employees in key decisions and paying for performance
rather than for time. They are taking the initiative in innovating and
managing change, rather than simply responding to what has already
happened.

Organization Development is playing an increasingly key role in helping

organizations change themselves. It is helping organizations assess
themselves and their environments, and revitalize and rebuild their
strategies, structures, and processes. OD is helping organization members
go beyond surface changes to transform the underlying assumptions and
values governing their behaviors. The different OD concepts and methods
increasingly are finding their way into government agencies, manufacturing
firms, multinational corporations, service industries, educational institutions,
and not-for-profit organizations.

Perhaps at no other time has OD been more responsive and practically

relevant to organizations’ needs to operate effectively in a highly complex
and changing world.

OD Models

Kurt Lewin’s Unfreezing, Changing, and Refreezing Model

Lewin’s model is based on premises that before actually

introducing a change organisation needs to be prepared for
change, motivated to change and established and integrated
the change into behaviours of organisation Accordingly,
Lewin has nomenclature these steps as unfreezing,
changing, and refreezing. A brief description of these
follows.
Unfreezing:
No change occurs in a vacuum of no prior perspective. To the extent the
new perspective differs from the old one, the old one then implies doubting
of its own existence. This necessitates unlearning of old things in order to
learn new things. The same is called unfreezing. Unfreezing involves
encouraging individuals to discard old behaviours by shaking up the
equilibrium that maintains status quo. Thus, unfreezing implies creating the
need for change, motivating people for change and minimising resistance to
change

Changing:
Having unlearned his past experience, the individual is ready for new
behaviour and a change in perspective. Efforts are made to substitute new
attitudes, values and behaviours for old ones. This implies transition from
old behaviour to experimentation with new behaviour.

Refreezing:
In this final step, new attitudes, values, and behaviours are established as
the new status quo. For this, the new ways of operating are cemented in
and reinforced. This implies stabilizing and integrating the change by
reinforcing the new behaviours and intigrating them into formal and
interpersonal relationships and in one’s personality.

Larry Griener’s Model:

According to Griener, change occurs in terms of certain sequential stages.

The external stimulus pressurises the management of organisation to
initiate change process. The management in response to stimulus is
motivated to take actions to introduce change in organisation. Following the
actions, the various change stages occur in a sequential manner such as
diagnosis of the problem, invention of a new solution, experimentation with
new solution and reinforcement from positive results.

Leavitt’s Model

Leavitt’s OD Model is founded on the interactive nature of

the various subsystems in a change process. In an
organisational system, there are four interacting sub-
systems- tasks, structure, people and technology. Due to
their interacting nature, change in any one of the sub-
systems tends to have consequences for the other sub-
systems also.

Change in any one of the sub-systems can be worked out

depending upon the situation. How the various sub-systems,
according to Leavitt, interact with each other in a change
processes depicted in the following figure 12.2.