Organizational development (OD) enhances business efficiency and competitiveness through strategic changes in structure, operations, and processes. This article provides real-world examples demonstrating OD’s impact on improving workplace culture, leadership, and performance.
By Brad Nakase, Attorney
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It’s easier to understand how organizational development (OD) works in real life when you look at instances of it.
This article will explain what organizational development is and show you how it has been used in the past through case studies. You will learn more about OD and the important part HR plays in it by going through these situations.
Organizational development (OD) is a well-thought-out, long-term process of helping an organization make changes to its operations, structures, or tactics that will make it more effective and efficient.
OD uses a method based on behavioral science to look at an organization’s processes or values and make changes that will fix problems and help it reach its short- and long-term goals.
A company might use an organizational development method for a number of different reasons. Even though every case is different, these are some of the most common OD goals:
Even though organizational development is about the company, a lot of the things it does are directly related to people. Since HR is in charge of putting these into action, the two roles cross. It’s not possible to reach OD goals without working with staff members.
Because people need to work together, organizational development teams are often part of the HR department. There must be a good working relationship between the two at the very least. When a company doesn’t have a formal organizational development function, HR professionals should still understand OD techniques and know when to use them. Adding an OD method to HR makes their strategic role in the company stronger.
Every business has its own unique way of administering organizational development. What works for one company might not work for yours. But it can be helpful to learn from a case study of organizational growth that was carried out well.
There are 4 types of OD treatments shown below: technological, human resource management (HRM), strategic change, and human process.
Interventions in technology and structure
These have to do with techniques and frameworks used in businesses, as well as the use of technology. Some of these are changing how decisions are made and how work is done, as well as finding new ways to get workers involved.
Examples of how to plan work and jobs
The multinational car company Volvo wanted to cut down on employee turnover and absences by making the workplace better for factory workers. Programs that improve jobs, like employee work groups, job expansion, and job rotation, taught Volvo how to better plan its buildings and workflows. These changes made the workplace more pleasant for the workers.
The hiring site Homerun switched to a 4-day work week in 2022, but they didn’t lower wages or add more hours to the work days.
Leaders think that workers can do the same amount of work in less time by being more efficient. They also hope to add more motivation and involvement, get better employees, and lower turnover and burnout.
Corning, a company that makes glassware, had a mold machine shop that was having trouble with cost overruns and slow delivery. By changing the shop’s structure and process and teaching workers communication and high-performance skills, the company was able to cut costs, make more money, and hire people with better skills.
At first, the people who started the instant message service WhatsApp didn’t have a lot of money or time. To keep costs down, they hired someone else to make the app. There are now more than 2 billion people using WhatsApp every day.
Some examples of an organization’s objective and its effect on society
The LEGO Group toy company said in 2020 that it would put up to $400 million into socially and environmentally responsible businesses over the next three years. It also promised to switch all of its packages to eco-friendly materials by the end of 2025 and look for an alternative to the plastic the company uses, which comes from fossil fuels.
Hope Foods is an organic food company that believes in spreading hope through food and messages that are good for the body, mind, and soul.
It raises awareness about mental health by providing guidance, resources, and support on its website. Hope Foods has also joined forces with a non-profit group that works to teach people about mental health and stop suicide.
These examples are HR-related and focus on managing performance to help workers grow and get better.
With a new take on the people experience, professional services business PwC has responded to recent changes in how employees want to work.
The “My+people” strategy at PwC is based on health and happiness, total rewards, leadership development, and connecting employees and graduates through a network. Leadership thinks that they can get and keep the best employees by giving them choices and freedom that help them reach their goals and be healthy.
Brother, a multinational business that makes electrical equipment, wanted to get more people to apply for jobs by promoting its employer brand.
They changed the career site so that the slogan “at your side” was more visible and added interesting material like videos, employee endorsements, and personalized job suggestions. This led to a big rise in applications that were fully filled out.
Examples of development of people and skills
Walmart, the biggest store chain and private employer in the U.S., wanted to push its workers to go to school and try new jobs within the company.
This program, called Live Better U, began in 2021. It gives its workers free training in new skills and higher education so they can get certificates or degrees without having to worry about money or debt. Walmart also works with a number of schools that are happy to accept adult students.
Company that makes technology To get a new group of future leaders ready, Microsoft had to update and make its leadership development process easier to understand.
In 2021, it made the training less manual. For small groups coached by the organization’s leaders, the new platform mixes classroom settings with hands-on problem-solving. The program is now easier to run and gives partners more information in a clearer way.
Voyage is a world leadership program that Marriott International, Inc. uses to find and train new leaders.
College students can apply for full-time, paid jobs that will open up after they graduate and last between 12 and 18 months. The jobs are located at Marriott hotels around the world and offer mentoring and hands-on practice. They learn about every part of the business and can talk to the leaders of the company.
With Voyage, Marriott gives recent college graduates a great chance to join its leadership pool and become top professionals.
Examples of strategic change. Transformation and restructuring are the main parts of strategic change interventions that help an organization adapt to changes in its internal and external surroundings.
Farmers, an insurance company for cars, homes, and businesses, put in new technology to help its customers and boost its image.
Farmers built systems around their customers so that they could pay their bills, manage their policies, and file claims at any time of the day. It has also begun using its own fleet of drones to check for damage to property. This makes things more efficient by cutting down on response time. It also keeps inspectors from having to climb on roofs and other dangerous places.
Farmers was able to get and keep more customers after investing in digital tools. It now serves 10 million homes in the U.S.
The acquisition of another company is a way for a company to grow and change its organization. In June 2016, Microsoft said it would buy LinkedIn, which is the biggest business network in the world.
The goal was to get more people to use LinkedIn while Microsoft grew its social media influence by combining its own products and using the data from LinkedIn’s huge user base.
Changing their corporate image is a common strategy for companies looking to adapt, remain relevant, or highlight new goods. Branding changes will include new logos, messages, shop layouts, and advertising.
The Dunkin’ Donuts restaurant company simplified its name and changed it to Dunkin’ in 2019. Their coffee was so popular that the leaders of the business decided to expand the brand to include more than just donuts in order to compete with Starbucks. David Hoffmann, President of Dunkin’ Donuts in the United States, said that branding is one of several things they are doing as part of their growth plan.
The company stayed true to its roots by using the same name, logo style, and colors from 1973. This helped it stand out and attract new customers who might not be interested in donuts.
Examples of effects on performance and business
If sales and profits for a product drop sharply, it wastes money and time and doesn’t really help the company. If a company wants to make more money and keep its image and stock prices high, it often gets rid of weak products.
Hewlett-Packard (HP), an IT company, released the TouchPad in July 2011 to fight with Apple’s iPad. However, it needed to do better in the market. Seven weeks after it came out, HP stopped making it.
FedEx Singapore, a delivery service, changed its performance management system to support the mindset of ongoing engagement and openness that the company wants to create.
There was a change from a standard 10-point rating scale to a method that was based on goals and competencies. What does “Exceeded expectations,” “Met expectations,” and “Did not meet expectations” mean on the new rating scale? They tell workers what success means to them. It is important to make sure that competency models are fair and useful for all types of roles.
Examples of human process interventions.
Interpersonal relationships and the dynamics of group success are part of human process interventions. The focus is on learning how to talk to people and fix problems.
Coaching yourself at Fujitsu SSL
Fujitsu Social Science Laboratory LTD (SSL) found that its middle managers needed more chances to learn new skills and improve themselves. The leaders wanted to fix this by giving managers the skills they needed to move the company forward.
Together with the creator of a self-coaching tool, Fujitsu SSL set up 30 meetings for a group of managers. They talked about specific conversation questions and shared their ideas and experiences about management. After the event, the people who took part led groups for more managers the next year.
Because the program worked so well, it became an important part of the middle manager growth program. Each year, 30 to 40 high-potential employees take part.
Examples of building teams
Building a virtual team at MyZone
The stress and unpredictability of the COVID-19 pandemic affected the people who work at MyZone, a company that makes fitness trackers. Their motivation and confidence were low, which made them less productive.
Leaders had to find a way for their workers who worked from home to connect with each other. They found a company that does team-building events that could host a Clue Murder Mystery party for the whole staff, even if they were in different countries.
Employees said that taking a break and having fun with their coworkers really lifted their spirits and made them feel more connected to each other.
The goal of organizational development is to help a company adapt and become more effective by making strategic changes. There are many things that can be done to help with organizational development. They can be put into four groups: technological, human resource management, strategy change, and human process. HR is an important part of organizational development. They are deeply involved with it and are in charge of putting many solutions into action. It’s important for HR to work together with organizational development teams, or even to start organizational development.
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