Five Benefits of Organization Development

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In 1999, I decided to formally make the transition from my academic focus on Clinical Psychology to the world of Organization Development and Industrial & Organizational Psychology.   What I remember most about this transition was how fascinated I was with certain organizational dynamics:

• how companies operated
• differences in organizational cultures
• the impact of leadership on company performance
• employees who are engaged in their jobs and their impact on company performance

Throughout my career, I have continually been engaged in asking questions that don’t always come with simple answers.  Just take for instance the question: How do you build a high-performing company?  This is not a simple question by any stretch of the imagination.  It requires an in-depth analysis of branding, market analysis, the quality of your product or service, funding, operational structure, leadership, employee management, employee development, and performance management.

Asking complicated questions and generating simple solutions is the magic and art of Organization Development (OD).

OD is the practice of planned, systemic change in the beliefs, attitudes and values of employees for individual and company growth.  The purpose of OD is to enable an organization to better respond and adapt to industry/market changes and technological advances.  I want to focus on five clear benefits of OD and specifically how OD initiatives can take a company from continuous improvement to increased profits.

1) Continuous Improvement – Companies that engage in organization development commit to continually improving their business and offerings.  The OD process creates a continuous cycle of improvement whereby strategies are planned, implemented, evaluated, improved and monitored.

Take for instance the Core10 Model which provides a focus on 10 simple principles (envision, enlist, communicate, clarify, strategize, design, implement, evaluate, adjust, and increase).  Notice the flow of these principles.  They can be applied to the management of the company as a whole, or to specific projects.  (More to come in our blog regarding the Core10 Growth Principles) Organization development is a proactive approach that embraces change (internal and external) and leverages it for renewal.

2) Increased Communication – One of the key advantages to OD is increased communication, feedback and interaction within the organization.  The goal of improving communication is to align all employees to shared company goals and values.  Candid communication also leads to increased understanding of the need for change within the organization.  Communication is open across all levels of the organization and relevant feedback is recurrently shared for improvement.

Whenever we see a breakdown in communication in an organization, we quickly are able to identify patterns of interaction that lack CONNECTION.  When people sense a lack in communication, it usually is not due to a lack of people being able to formulate a message using accurate words.  It is more a result of people not being on the same page, conflicting agendas, lack of trust, or simply the lack of effort placed on connecting with others in the organization.   In other words people are failing to make common that which is important in operating the organization.  “To make common” is the actual root meaning of the word communicate.

3) Employee Development – Organization development focuses on increased communication to influence employees to bring about desired changes.  The need for employee development stems from constant industry and market changes.  This causes an organization to regularly enhance employee skills to meet evolving market requirements.  This is achieved through a program of learning, training, skills/competency enhancement and work process improvements.

We recommend to all companies that they establish a formal training entity – an academy or a corporate university.  Even small businesses can establish a clear roadmap for personal development.  Here’s what we must remember – we all want to grow!  Every one of us is hard-wired for growth.  We want to be better next year than we are today.  If we fail to meet this need for employees, they will go elsewhere.  Again, the war on talent is real!  The most talented employees want to keep growing personally and they also want to be a part of a growing and thriving business.

4) Product & Service Enhancement – A major benefit of OD is innovation, which leads to product and service enhancement.  Innovation is achieved through employee development, which focuses on rewarding successes and boosting motivation and morale.  In this scenario, employee engagement is high leading to increased creativity and innovation.  Employees want their opinions to be heard!  Organization development also increases product innovation by using competitive analysis, market research and consumer expectations and preferences.

The more you invest in your people, the more they will invest in the business.  If you give the minimum, they will give the minimum in return.   It is amazing just how reciprocal this relationship is.  You get what you give!

5) Increased Profit- Organization development impacts the bottom line in a variety of ways.  Through raised innovation and productivity, efficiency and profits are increased. Costs are also reduced by minimizing employee turnover and absenteeism.  As OD aligns objectives and focuses on development, product/service quality and employee satisfaction are increased.  The culture shift to one of continuous improvement gives the company a distinct advantage in the competitive marketplace.

As OD initiatives are implemented throughout the business, your people strategy aligns more and more with the business strategy, becoming one in purpose.  The end goal of OD initiatives is to maximize the potential of people so as to maximize the potential of the organization as a whole!