Putting the ‘Organisation’ back into Organisation Development

Talk to many HR Directors, and organisation development appears to be synonymous with leadership development. This is the traditional approach, it’s person-centric and the premise is that working directly with the leader or leaders of an organisation has sufficient impact that the downwards cascade of change can initiate and sustain changes in lower levels of the organisations – and that those lower level changes are congruent with the intent which started at the top.   The phrase ‘organisation development’ has become over-used, there’s lots of theory and models based on the psychology and behaviour of individuals, and on leadership of all shapes and persuasions. And, of course, the development of individuals, their skills and competencies, values, beliefs and mental models is a critical element. But somehow, what makes organisations … well, organised, or not, has got lost. For us, organisational development differs from management development and focuses on mapping the capabilities which the organisation needs and progressively developing those.

Whether we think we do or not, we all use mental models to understand the world. Mostly these models are individual, tacit and unconscious. For managers, their ability to manage their organisation or a situation within it depends on their understanding of how that organisation really works. And that is directly related to the quality and relevance of their model of the organisation. We can’t manage what we don’t understand. So, having a shared explicit model of the organisation is fundamental for a management team. Without this, different parts of the organisation seek to create stability and clarity for themselves, and evolve their own part of the organisation without reference to or understanding of the whole.

So when we talk about organisation development, we mean developing the capabilities of the organisation, not of the people. And critical for this is a map or model of those capabilities, how they relate to one another and how they work together to form a coherent and cohesive whole. Not the organisation chart or reporting lines or other hierarchy diagram, but instead a way of looking at the organisation which shows what work the organisation does, how it does that work, how it takes decisions, how it allocates resource to accomplish the desired performance, and how it adapts itself.

Organisation development, then, starts with a suitable organisation design, which is a model of the organisation as it is today. We start with understanding all of the organisational capabilities, how they interact, what level of performance is required of each, and what level of performance is actually being delivered. In terms of organisation development, one task of management is to raise the performance of the organisation, so that it delivers at or near its best as much of the time as possible. Improving the performance of linked capabilities needs to be done in an integrated way so that enhancing one capability doesn’t just create a bottleneck somewhere else. The other major task is to establish what each capability could be capable of, with investment to enhance its performance, and to manage a portfolio of transformation which boosts the performance of the whole, in a way which is aligned with the strategic direction for the organisation. This portfolio prioritises the changes which need to be made, and ensures that the rate of change is appropriate, with sufficient management capacity to handle the change and with no area of the organisation overloaded with change and compromising its ability to deliver. It also ensures that each change is managed at an appropriate level; some changes will be managed at an organisational level and some at an organisation unit or even a team level.

So organisation development takes an existing organisation structure and drives current operations to perform at their best, as well as investing in performance improvements and changing how certain activities area done. This is critical work, so that the organisation maintains both its fit with its environment and its internal coherence.