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What Is Organizational Development For HR?

An infographic showing Lewin's model for organizational development
Hacking HR Team

Posted on July 04, 2024

Organizational development is an important piece of the puzzle to build a future-proof organization.

Organizational development and human resources have similar principles and concepts but have distinct meanings. Still, the fields of organizational development and HR are closely intertwined with one another.

HR professionals need to understand the core concepts and processes of organizational development to create a healthy, happy, and thriving organization.  

With its roots in psychology and social sciences, some HR professionals are afraid to dip their toes into the water of organizational development – but it doesn’t have to be complicated. Here’s your essential guide to organizational development for HR. 

An infographic shwing the core areas in organizational alignment: Strategy, systems, values, people, and leadership.

What Is Organizational Development?

Organizational development is a science-backed method to implement systematic change in an organization to help improve organizational effectiveness and organizational efficiency and fuel overall company growth. 

Organizational development applies a psychological, research-backed approach to aligning organizational strategy and influencing behavior to align the organization’s day-to-day routine more closely with larger organizational goals. Organizational development emphasizes constant change to better the organization.

Organizational development focuses on aligning core areas, such as: 

  • Strategy 

  • Systems

  • Values

  • People

  • Leadership

Integration with HR Management 

While a traditional HR approach focuses on administrative tasks and managing the day-to-day of the organization’s people, organizational development takes a more strategic approach that is more closely aligned with strategic human resource management (SHRM). Organizational development aims to look at the organization from a broader, more holistic lens to assess opportunities for change and improvement. 

Although different, organizational development and human resources have overlapping areas, which is why HR must take a front seat in embracing and participating in organizational development.  

Development vs. Change

Although certainly related, organizational development and organizational change are not the same, and it’s important to understand the difference between the two. 

Organizational development focuses on bettering the organization holistically through systematic changes. It is a long-term process to implement continuous, lasting changes. On the other hand, organizational change refers to changing part of an organization – such as culture or technology – to achieve a specified goal, meet a specific need, or solve a problem. Organizational change is short-term – sometimes project-based or time-bound – and has a clear timeline with deadlines and measurable goals.

Organizational change can happen within organizational development, and although they both aim to meet organizational needs, they serve different functions for an organization.

Why Organizational Development Is Important

Organizational development can help organizations meet overarching goals, pushing them forward to become more future-proof and thriving organizations. 

Organizational development theory – created from concepts by the “founding father” of organizational development, Kurt Lewin – helps to provide a framework on the overarching objectives of organizational development, which are rooted in humanistic values. 

According to organizational development experts Newton Margulies and Anthony Raia, these core values are:

  • Providing opportunities for people to function as human beings rather than as resources in the productive process

  • Providing opportunities for each organization member, as well as for the organization itself, to develop to his full potential

  • Seeking to increase the effectiveness of the organization in terms of all of its goals

  • Attempting to create an environment in which it is possible to find exciting and challenging work

  • Providing opportunities for people in organizations to influence the way in which they relate to work, the organization, and the environment

  • Treating each human being as a person with a complex set of needs, all of which are important in his work and in their life

Benefits of Organizational Development

Depending on specific workforce needs and goals, implementing organizational development can have several important outcomes and organization-wide benefits. 

Here are a few ways organizational development can help improve an organization:   

  • Performance: Improving employee performance is an important aspect of organizational development. Many interventions include mentoring, training, and development opportunities that can help improve productivity and output.

  • Communication: When it comes to aligning an organization, communication is imperative. So it only makes sense that organizational development can lead to improved communication between employees and leaders, either as a side effect of organizational development implementation or an end goal.

  • Adaptability: One of the pillars of organizational development is creating adaptability and flexibility to build up organizational resiliency because organizational development is all about lasting change.  

  • Retention: The overall goal of organizational development is to foster a more positive, people-first workplace. That can lead to happier, more engaged employees, which can have a direct impact on attraction, satisfaction, and retention.

  • Innovation: The organizational development model emphasizes experimentation and embraces failure, which can help promote creativity and innovation. New ideas can help promote a future-first organization.

An infographic showing Lewin's model for organizational development.

Roadmap to Organizational Development

Despite its broad definition, organizational development has a clear process for how to go about implementing strategic changes and improvements. 

Kurt Lewin’s work on organizational development outlines three key steps to creating and sustaining change: unfreezing, changing, and refreezing.

  • Unfreezing: Unfreezing focuses on preparing an organization for expected change, including readying and motivating employees to accept and embrace changes. In the unfreezing phase, leaders should address any resistance to change or questions about how or why things are changing. 

  • Changing: As the name suggests, this is the period where the changes actually happen. Whether it involves a change in strategy, values, or processes, changes should be aligned with greater organizational goals and strategy. During the changing phase, HR and leaders may have to experiment and iterate to help adjust employees to a new way of doing things. The organization should prioritize transparent communication, effective management, and continued flexibility during the period of change.

  • Refreezing: Refreezing involves sustaining and stabilizing changes for the long term. It occurs after changes are implemented and optimized, and changes havae been implemented into day-to-day operations. Through initiatives like reward and recognition, leaders can ensure that changes are sustained and workers don’t fall back into old habits. 

An infographic showing the 7 phases of organizational development.

The Organizational Development Cycle: 7 Phases

Although Lewin’s model gives a general idea of how organizational development works, some specific steps can help implement and enhance organizational development. Here are the 7 phases of an organizational development cycle. 

1. Entry

In the entry phase, leaders or managers identify a need or an opportunity for improvement within the company. The entry phase may be triggered by an internal or external change, such as profit loss, high turnover, internal conflict, or complaints from clients or customers. 

Once a need is identified and leaders have explored the scope of the issue and any deeper-rooted issues related to the problem, the next phase is initiated. 

2. Diagnosis

The diagnosis phase involves “diagnosing” the existing functions, processes, and overall health of the organization. Put simply, in this phase, leaders look at current organizational systems to determine whether they’re succeeding or not.

The diagnosis phase can include several techniques to get the full picture of how an organization is functioning, such as:

  • Data collection and analysis

  • SWOT analysis

  • Surveys or focus groups

A comprehensive diagnosis phase is essential to the success of organizational development because it helps establish a benchmark of how an organization is currently functioning and helps inform leaders of what interventions should be taken to improve. 

3. Planning

With a complete diagnosis, the next step is the planning phase. Just as it sounds, the planning phase centers around developing a plan to implement changes to improve the organization.

The planning phase incorporates feedback from key stakeholders, leaders, and experts to determine an action plan. The action plan typically consists of specific objectives and goals, strategies and interventions for improvement, and resource allocation. 

It’s a comprehensive process that helps create a roadmap for leaders to follow through the entire organizational development process, so it’s important to set goals that are SMART (specific, measurable, achievable, relevant, and time-bound). 

One of the most important parts of this phase is defining desired outcomes and goals when the organizational development cycle is complete.

Organizations may set goals such as:

  • Improve communication and transparency across the organization to enhance employee trust, foster collaboration, and streamline the flow of information 

  • Foster a more positive and inclusive workplace culture to enhance well-being

  • Boost operational efficiency by streamlining processes and workflows, breaking down silos, and optimizing resources

4. Intervention

After an action plan is fully developed, the intervention stage is where planned changes are implemented through interventions. 

There are four main types of organizational development interventions:

  • Human process interventions: Initiatives aimed at improving interpersonal relationships or organizational dynamics, such as team-building or coaching. 

  • Techno-structural interventions: These interventions are focused on the technology and structure of the organization, like organizational restructuring or total quality management.

  • Strategic interventions: Strategic interventions are larger changes to the overall organization, like organizational transformation or organizational culture changes.

  • HR management interventions: Human resource management interventions are related to the functions of HR management, like talent development or wellness initiatives.

Examples of Interventions

Interventions are dependent on the specific needs and goals of the organization and might include specific activities or initiatives. Examples of interventions could include: 

  • Redesigning organizational processes to improve effectiveness

  • Creating training and development programs targeted at leadership development or organizational needs

  • Initiating team-building activities to improve collaboration and camaraderie 

  • Providing coaching and mentoring opportunities to develop employees and improve succession planning

  • Making cultural changes, such as redesigning organizational values

During the intervention stage, leaders should focus on getting buy-in from stakeholders and employees. This can ensure that everyone is on the same page and lessens change resistance, providing a greater chance for the interventions to be successful.

5. Evaluation

After the action plan is initiated and interventions are put in place, it’s time for the evaluation phase to assess the impact of the plan on the organization. It assesses the effectiveness of the changes by measuring progress, collecting feedback, and comparing data from the diagnosis phase.

In the evaluation phase, leaders may alter or enhance interventions if predefined goals aren’t being met. 

6. Stabilization

As desired outcomes are reached and interventions prove successful, leaders shift to sustaining and stabilizing changes through reinforcement. In this phase, changes are embedded into the organizational culture and reinforced among employees.

Even as goals are achieved, it’s imperative that leaders conitnue to offer support and resources to help employees adapt to changes to ensure that they stick.

7. Reassessment

Finally, the various organizational development phases are reassessed through looking at and comparing data and any success metrics. 

If interventions have proven successful and there are no ongoing issues, the cycle may be documented and closed. However, if needed, the process may also start over again from the diagnosis phase to improve the organization further and refine the phases.

Key Insights: How HR Can Boost Organizational Development 

Even though organizational development is separate from HR, HR plays a key role in implementing and improving organizational development, whether initiatives are focused on HR functions or not. 

Here are a few ways that HR can help improve and promote organizational development:

  • Keep a finger on the pulse of the organization: Understanding organizational needs is the first step of organizational development. Without understanding the needs of the organization, processes that need to be improved can go unnoticed and unaddressed. By continuously assessing the organization and identifying gaps, HR can have a stronger idea of what the organization needs.

  • Align HR strategy with organizational goals: Keeping HR strategy aligned with business goals and organizational culture can improve organizational effectiveness and create a more closely aligned organization that will be better suited for successful organizational development. Additionally, having overarching organizational goals that everyone is working toward can make it easier to target improvement areas and implement changes.

  • Develop training programs for employees: Promoting continuous learning for employees – especially to address skill gaps and leadership development – can ensure that an organization is more prepared to embrace change and improve the organization. But training doesn’t just have to be for technical or leadership skills; development programs can also help enhance skills relevant to organizational development, such as change management and communication.

  • Focus on organizational resilience: There is no denying the importance of organizational resilience, which can create a future-proof, adaptable organization. A resilient organization will adapt and evolve with changes, instead of fighting against them, which can make a significant impact on the success of organizational development.

Join 'Leading HR'!

The 'Leading HR' certificate program is meticulously crafted to provide the tools, insights, ideas, data, stories and experience to enable senior HR executives and leaders to navigate the complexities of the modern workplace and drive strategic organizational change.

In this training program for Human Resources leaders, attendees will explore how to align workforce planning with organizational strategy and future needs, and master workforce planning techniques, anticipating future workforce requirements, aligning workforce strategy with business objectives, and managing talent risks and opportunities.

Learn more about 'Leading HR' here.

The flyer of the certificate program titled 'Leading HR' shows a lightning in the middle and the logo of the People and Culture Strategy Institute, powered by Hacking HR, at the top center.

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