Organization design blog

The received wisdom is that the majority of change efforts fail: the commonly quoted number is upwards of 60%. Indeed I got a white paper telling me just that earlier this week.

Whether or not this is true is open to debate. Consider the introduction of the i-pad as a 'change management' effort. Did this fail? Not according to sales statistics. Is Facebook a 'change management' effort? Did this fail? Not so far anyway. Did we change our views of the financial sector as a result of a 'change management' effort? I don't think so, but society's views (at least in the UK and US) of this sector have changed following the financial crash.

For some reason organizational 'change management' is held to be a planned effort aiming to convince employees that what is usually a pre-determined management course of action is exactly what the employees should – in the jargon – 'embrace'. There may well be 60% failure to 'embrace' a subtle, or not so subtle, form of coercion. But that is more likely due to the programmatic aspects of an 'initiative'.

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Building employee trust is something that many organizations say they want to do. A leader will say something like 'I want to build a culture of trust'. This sort of statement makes me curious and I tend to follow up such a statement with a series of questions: What do you mean by trust? What outcome would you expect to see in a 'culture of trust' that you don't have currently? What do you think 'trust' would feel like in your day to day operation if you were able to build it? And so on.

In my experience 'trust' is one of those often ill-defined concepts that people intuitively feel would improve organizational performance. They believe it is within the standard remit of an organization development consultant to help with building trust. And they wonder if it could (perhaps) be designed into the organization.

In some respect their intuition is correct. There's a certain amount of evidence that people are more productive and motivated if they are treated respectfully, honestly, and fairly by their supervisors, and have an open and supportive relationships with both supervisors and colleagues. Leader member exchange theory is one that supports this perspective. (See Leader-Member Exchange Theory and Research: Accomplishments and Future Challenges, Leadership August, 2006 2: 295-316). These concepts of fair treatment and so on are close to some of the many definitions and expressions of trust.

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Last week I was facilitating an organization development program. We started off discussing three definitions of organization development, and what their similarities and differences were. The three we considered were.

• Organization Development is a dynamic values-based approach to systems change in organizations and communities; it strives to build the capacity to achieve and sustain a new desired state that benefits the organization or community and the world around them. Organization Development Network
• It is the systematic application of behavioral science principles and practices to understand how people and organizations function and how to get them to function better within a clear value base. It is shamelessly humanistic and has strong value drivers. Linda Holbeche, Organization Development – What's in a name?
• OD is the activities engaged in by stakeholders in order to build and maintain the health of an organization as a total system. It is characterized by a focus on behavioral processes and humanistic values. It seeks to develop problem solving ability and explore opportunities for growth. Roffey Park

People homed in on the values of OD. Look at the definitions and you'll see the phrases "OD is a dynamic values-based approach", it is about functioning with "a clear value base. It is shamelessly humanistic and has strong value drivers." "It is characterized by a focus on ... humanistic values."

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Running a session this week on organization design led to the participant group raising questions and then discussing the differences and similarities between workplace design, workplace strategy, workplace design strategy, and organization design.

There was no real conclusion except that semantics matter, and in order not to confuse our clients and ourselves we need to clarify the terms, or stick with one agreed short description that covers the range.

Attempting to clarify this for myself I found an article by Eric Olsen, Workplace Design Strategy: An Alternative View. In this he compares Galbraith's Five Star model with Hurst's soft bubble model. He does this in the context of discussing a paper, Solving the Right Problem: A Strategic Approach to Designing Today's Workplace, written by Arnold Craig Levin in the Spring 2007 issue of the Design Management Review.

Levin's paper builds on a previous one he published Changing the role of workplace design within the business organisation: A model for linking workplace design solutions to business strategies published in the Journal of Facilities Management in 2005. In the abstract Levin notes that:

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During the past week someone asked me if I would come and teach an internal consulting skills course to her team. Simultaneously I had to submit an article for publication. (I am a regular columnist to the Chinese publication HR Value). What better synergy than spending time working on a consulting skills proposal, an article on consulting skills and then a blog piece on the same topic?

From a writer's perspective this is actually three totally different pieces of work as the audience is different, and thus the style, tone and content have to be different. Nevertheless the basic ideas are the same so there is marginal time saving in sticking to one topic. In fact this could be a good idea anyway. I came across a blogger who only ever writes about simplicity and earns his keep by consulting on simplicity. So the question I ask myself is "is singular focus better than scattergun?" But that is not to answer here.

Before looking specifically at consulting skills and the reasons for developing them let's answer the question "what is consulting?" Briefly, it is a method of exploring with a client an issue, problem, or question that he or she has, and then working with the client to develop a method of addressing the situation and together implementing the agreed solution. It is a relationship of collaboration and partnership and not one of command and control.

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This past week has been exceptionally busy for me, but reflecting on it a theme has emerged as, among other things, I've read three articles on healthy communities, participated in a discussion on organization development in China, and read a lovely article about a woman in her 70s who is an excellent runner and has developed her form using Chi running techniques, and commented on a wellness white paper a colleague sent me.

The connection between all these is close, albeit from different perspectives. They are all concerned with creating and using positive energies and emotions. Doing this leads to individual and organization health and high performance. I'm glad that I've recognized the theme and can now re-group myself as by Friday I felt thoroughly pulled down by the inertia, politics, and power plays of organizational life. (Not helped by watching the movie All the King's Men about a politician,Willie Stark, who "begins his political career as an idealistic man of the people but soon becomes corrupted by success and caught between dreams of service and an insatiable lust for power")

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Imagine a look alike Las Vegas casino but in Johannesburg. Now imagine around 70 organization design consultants sitting in there in one of the artificially lit hotel conference rooms working through an eclectic program of presentations, exercises, flag twirling, journey mapping, world café, and other things beloved by 'interventionists'. I was one of the 70 at the New Africa Organization Design Forum Summit there. My task was to talk about the myths of organization design. At points I found myself asking myself 'am I seriously part of this community?' this question perhaps brought on by the ODD sessions. I finally worked out that ODD was an acronym (organization design and development) and not intended to be a descriptor so clearly I was confused there, but maybe not.

The program veered from the sedate, and the 'I've heard this a thousand times before', to the wacky in unpredictable sequence, each session with its own specific language and vocabulary that required a jargon buster (unfortunately not provided). Similarly it veered from participants being seated and listening attentively to a presenter with power points to scrabbling on the floor picking up the bones and beans that John Ballam sowed amongst us in his superb method of shaking us out of our known worlds of 'adaptive systems', 'holistic thinking' 'new paradigms', 'mental models', and so on leading us towards 'shamanism', 'healing', 'energy fields', 'the consistency of the unseen', and 'fractals'. His mix of theatre and chaos theory started with his own chanting, dancing and sowing and finished with all participants doing a short stomp dance with pelvic wiggles. (Odd or not? Form your own views).

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I've been thinking about business models this week - what makes it easier or more difficult for companies to change or adjustment their model at regular intervals? Failure to do that has significant consequences as AT & T, a US telecoms company, found out. Originally established in 1885, in 2005 it was bought by SBC for around $16 billion. SBC was one of the 'baby bells' that was spun out of the company, known as 'Ma Bell,' as part of a 1984 court-ordered break-up.

The failure, at the time, of leaders of AT & T to change its business model in order to take advantage of new technologies such as wireless and internet were cited as reasons for the takeover. But they are not alone in this failure as Clayton Christensen, of Harvard Business School, and author of several books on innovation said on hearing that AT & T been bought. 'It is a tragic fall [for AT & T] and I lament the passing, because it was a huge disruptive success in its day. The world is filled with companies that are marvellously innovative from a technical point of view, but completely unable to innovate on a business model.'

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We were in a meeting last week talking about virtual working and how often people who are in virtual teams should/could come in to meet each other face to face, and for what reasons. We had some debate on this and then someone said that his concern was with the Gallup question on the employee engagement survey that we use. One of the questions respondents are asked to rate is 'I have a best friend at work'. His concern was something on the lines of if it is important for motivation and productivity to have a best friend at work then how would people find a best friend or develop a relationship that would qualify as such if they weren't meeting face to face as often or even at all.

The Gallup Management Journal has a short article about having a best friend at work saying:

Human beings are social animals, and work is a social institution. Long-term relationships are often formed at work -- networking relationships, friendships, even marriages. In fact, if you did not meet your spouse in college, chances are you met him or her at work. The evolution of quality relationships is very normal and an important part of a healthy workplace. In the best workplaces, employers recognize that people want to forge quality relationships with their coworkers, and that company allegiance can be built from such relationships.

The development of trusting relationships is a significant emotional compensation for employees in today's marketplace. Thus, it is easy to understand why it is such a key trait of retention, and is one of the 12 key discoveries from a multiyear research effort by The Gallup Organization

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Here's a quote from an email I received this week:

"We are about to undergo a space renovation to provide a more collaborative work environment and allow us to start hoteling*. We recently announced this initiative at a staff meeting and there was a lot of apprehension from the employees regarding the change. Do you know of a good change management training course that is offered? I think it would be beneficial to everyone to ease their concerns and show them than change can be a good thing."

In the email quoted you have a classic situation. Leaders believe that to develop the organization they need to provide a more collaborative work environment and start hoteling. That is the strategy piece that aims to develop the organization. The change management piece is helping workers adapt to the change in circumstances and context that this development strategy brings about.

So, organization development is not the same as managing change. To make it simple OD is strategy and the change management is operations. But with this in mind it is obvious that in order for organizations to develop/improve then aspects of their operation the process, people, space, technology, have to change. Thus organizational development and change management are intertwined.

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I've been involved in several change management discussions this week. The project I'm involved in is a large scale change in the way of working. We have a lot of good business reasons to move from what we're calling 'old ways of working' - compartmentalized, individual, space entitled, fixed location, single function - to what we're describing as 'new ways of working' - shared, collaborative, no space entitlement, dynamic, and cross functional.

We're struggling with manager incomprehension about the whole thing. As a colleague said, "I think we have a major hill to climb in obtaining management receptiveness to this. I believe they are generally wary of this form of change, this degree of change, and this need for change. They are reluctant through a combination of:

• 'rather leave as is' = 'life would be a lot easier'
• 'I am not sure how to do any of this'
• 'this sort of thing has failed before'
• 'I am very wary of being caught in the middle of something which could turn nasty'
• 'I am convinced the unions and staff will not go for this'
• 'I am not entirely confident about my leadership team and where they are'
• 'What? This as well as everything else?'"

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Your organization is probably like all other organizations. It is continuously searching for ways to add value to its products and services in order to keep growing. Organization development leaders are in a key position to help their executives think through what both 'growth' and 'value' are and how to add them.

Effective and healthy organizations see value in more than just meeting the business goals. It is not enough to concentrate on, for example, financial performance, if it is at the expense of employee well-being. Value needs to be fostered and developed in all organizational aspects: people, process, structures, systems, behaviors and governance. 'Growth' is usually equated with size - organizations get bigger, extend their markets, products and services. But growth can be in other dimensions. An organization can, for example, stay small in size but grow its thought leadership so it becomes known for that. Alternatively it can grow its capacity to retain and develop its people, maintain customer loyalty, or introduce environmentally friendly practices - all adding value without becoming bigger in size.

Creating organizational value and growth is done partly through designing and implementing methods of developing workforce capability which Dave Ulrich , Professor of Business as the University of Michigan, defines as the firm's ability to manage people to gain competitive advantage.

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Which of these groups of names sound more familiar to you?

Group 1: Chris Arygris, Herbert Shepard, Warner Burke, Larry Greiner, Harry Kolb, Kurt Lewin, Ronald Lippitt, Ralph White, Richard Beckhard, Warren Bennis, Robert Blake, Paul Lawrence, Jay Lorsch, Douglas McGregor, Edgar Schein, Fred Emery, Reg Revans, Eric Trist, Elliott Jaques, Abraham Maslow, B. F. Skinner, Carl Jung, Roberto Assagioli,

Group 2:Margaret Mead, Karen Horney, Mary Parker Follett, Mary Gilson, Jane Addams, Jane Mouton, Margaret Wheatley, Edie Seashore, Elizabeth Bott Spillius, Isabel Menzies Lyth.

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The past week I involved both gathering and distributing resources - mainly book title, articles, and websites. There was no single event sparking this, rather each meeting (of which I had a minimum of five each day) spawned something to look up or pass on. So I thought I'd collect in one spot everything that I put in my gunny sack on during the week and see if there were any themes or patterns or whether it was just a random collection of stuff.

Articles
Note that I'm not employed by M cKinsey Quarterly and nor do I get a commission for promoting their articles but I did like four that passed through my in-box this week and I passed on the details to colleagues.

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Question: We are responsible for assisting government offices to design their organizational structure. The process is as follows:

1) Government Ministries/Department draw up their strategic plans

2) Once the plan has been accepted they start working how they need to adjust their organization design to ensure implementation of the plan. Some do Business Process Re-engineering and some don't because it is not a requirement.

3) When the request for structural help come to our Department, we tackle the request by looking at the following elements:

• Unity of command and direction
• Chain of command
• Span of control
• Division of work
• Standardisation

We do workflow studies and we use the norms to design positions on the structure.

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Having been well indoctrinated by David Allen (Getting Things Done), Stephen Covey, Time Management International, et al, at the end of each month I review what has happened in the way of meetings, ideas, books/articles recommended, and do something with them: file, trash ...
February 2011 has proved a rich picking on many fronts. As I do the cull among the reminders to myself to pick up library books, and buy milk I find

a) Approaches from individuals in South Africa, India, Namibia, Saudi Arabia, Finland- all interested in organization design training
b) Contacts from people wanting to enter the field of organization design - Frieda, Emily, Laura, Helle, Tiffany (why all women?)
c) Several book and article recommendations:
d) A host of ideas to mull over related to new ways of thinking about organizations most captured cryptically in my Daytimer in a way that leaves me struggling to remember more of the context e.g. the collectively circled three words "serendipity, spontaneity, sublety",
e) Notes of meetings I've attended (I now find I have 8 standing meetings a week, each of an hour) and during the month I've run three workshops with an average of 12 people each, additionally I've met one to one with over 30 people, and made first time phone contacts with several others.
f) Notes about meetings I've attended e.g. why is 'reset' the word of the moment?
g) Many, many actions arising from the meetings that I need to do something with or about.

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The book chapter that I mentioned the other day is coming along in spite of the interruptions from present exchange, holly and ivy things, and other 'holiday' (aka Christmas) stuff. It's wonderful how much I'm learning by writing the chapter, so I'm finding it an enjoyable process at this point.

As my chapter is on the history of organizational development (though I'm still getting stuck on is it organization development, organizational development, organisation development, or organisational development and am using all forms indiscriminately) I've been looking at information on the early years of the Tavistock Institute of Human Relations. Established in 1947, today it is

engaged with evaluation and action research, organisational development and change consultancy, executive coaching and professional development, all in service of supporting sustainable change and ongoing learning.

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I've been asked to write a chapter for a new textbook on Organization Effectiveness. As always this seemed like a lovely opportunity when it was first suggested, and I accepted it cheerfully. Unfortunately, now that the deadline is looming (January 19) and I haven't yet done more than think about it at odd moments, the whole notion of writing 8000 words feels like a tremendous ordeal.

The book's working title is "Transforming Organizations: reconnecting and redirecting OD and HR" and

"will examine the increasing evidence for an integrated HR/OD approach to enhance organizational performance at a time of unprecedented austerity in the public and private sectors. The collection of chapters will deal with the competing challenges faced by HR functions, which are under massive pressure to demonstrate how they can contribute to organizational performance and wellbeing. It will also address the growing debate within Management and HRM Journals about the need to address the increasing distance of research from its user base. "

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Last week I took a road trip by Greyhound bus. Since I'd also taken various other transport trips in the last month (2 different airlines to get me to Shanghai, Amtrak to New York, subways in DC, and Shanghai, buses in DC) the Greyhound experience was just another travel experience to enjoy or endure.

This Greyhound one started off with booking my ticket on-line. That was straightforward enough. Fortunately the day before I read the small print in the acknowledgement email and saw that seats were allocated on a 'first come' basis and if the bus got filled before you got on then you had to wait for the next one. I was traveling on the busiest travel day of the US travel year.

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Well, over the weekend I've got hooked on organizational cultures of gratitude. I've now discovered an article by Charles Kerns at the Graziadio School of Business and Management. His article Counting your blessings will benefit yourself and your organization. has a good number of references to explore (including some from Robert Emmons whom I mentioned in my previous blog on this topic), and a second article by Kerns, Putting Performance and Happiness Together in the Workplace bears a strong likeness to the Harrison article I mentioned in my previous blog on Cultures of Gratitude. I'm not implying plagiarism here. It's just that Kerns suggests that 'Happy High Performers' exhibit the following characteristics:

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I haven't yet come across a CEO who says he/she wants to instill in their organization 'a culture of gratitude'. I've heard them ask for cultures of innovation, teamwork, collaboration, creativity, and customer service among others but not gratitude.

Yet organizations, thinking of them here as entities with personas, have a lot to feeling grateful for: that they have customers or clients willing to buy their products and service, that they have suppliers able to supply them with stuff to operate, that they have shareholders willing to invest money in them, (or in the case of non-profits volunteers willing to invest time in them), that they have employees willing to work for them, that they have regulations to help their competitive position (witness SAP just having to pay Oracle $1.3 billion this week in a copyright infringement lawsuit). I'm sure you can think of other aspects in where organizations could feel gratitude. Would having a 'culture of gratitude' make a difference to performance - preferably in the direction of high performance? Maybe, but probably only if gratitude was seen as a positive organizational attribute and not a credibility buster.

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Yet again I turn to my 'rules of thumb for change agents' first printed, as far as I know, in Organization Development Practitioner in November 1975. The author was Herbert A Shepard who was according to the introduction on the Herbert Shepard Foundation website.

A pioneering thinker in the Organization Development movement, an engaging teacher and mentor of exceptional depth, scope and humility with a gift for recognizing and nurturing the potential of others. His unselfishness, utter sincerity, compassion and unwavering commitment touched lives, forged lasting friendships and helped shape the careers of a generation of leaders and social scientists. He held faculty posts at several universities including M.I.T., where he received his doctorate in Industrial Economics. He founded and directed the first doctoral program in Organization Development at Case Western; developed a residency in administrative psychiatry at Yale University School of Medicine, and was also President of The Gestalt Institute of Cleveland.

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During the training courses in Shanghai last week I was asked what a typical day in my working life was like. Given that I was classifying myself as an organization development consultant I thought I would see if I could describe one of my days taking Monday November 15 as a 'typical day'. It was typical in that I was not traveling anywhere and I had the normal number of scheduled meetings.

I began the day with a self-reflection exercise as I'm enrolled on a month of self reflection with the To Do Institute. It's interesting in that it has the same underlying premise expressed by Peter Block in his book Flawless Consulting. In this he says 'An authentic consultant, is not any oxymoron, but a compelling competitive advantage, if unfortunately a rare one.' Block talks about authenticity in terms of 'simply being honest with ourselves and being direct and honest with others.' The self-reflection program is partly about developing that authenticity.

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On the programs I was running in Shanghai last week I was asked by several participants at different points and in different contexts to explain the differences between coaching, counseling, mentoring, and consulting.

On the flight back to the US I was thinking about this and wondering what the best way to answer was. In the course of this musing I wondered if there was a cultural distinction. Did the US/UK language have four different variations of what is essentially the same thing - advising people about a course of action, either by helping the individual come to his own approach or by telling him/her what to do. And does Mandarin only have one word for these multiple advising approaches?

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Day 2 of the Organization Development program raised a lot more questions from the participants. The deep interest in the topic from the group members is fantastic, and really caused me to think more about the content of the program. Three questions I thought might merit a whole session in any revised version were:

How do you get OD work as an internal consultant? Oddly, this question was raised by a colleague of mine a couple of weeks ago. What the questioner wanted to know was should he wait for line managers to call him because they had a problem or opportunity that they thought he could help them with, or should he go out into the organization and actively search for work. And if the latter how do you do this?

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Wednesday (yesterday) seems to have been my day for thinking about leadership. I had brushes with ideas on leadership during the day. The first was with someone with whom I was discussing possible reasons for organizational inertia. The second was with someone who was perplexed that people in the organization kept saying that they couldn't act because they didn't have the right level of leadership support. The third was an email that invited me to a lunchtime discussion on "Courage - The Essential Leadership Competency". The fourth was a piece of writing the author had sent me titled "Leadership in the Petaclasm" with his response to my response on that piece. So I'll take a brief look at each of the four pieces in turn.

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Yesterday I was at day one of a two-day off- site with around 200 people participating in a form of Future Search conference.Future Search is a planning meeting that "helps people transform their capability for action very quickly." In this case we were looking at four knotty problems to be tackled with three outcomes

• A depicted vision, strategic roadmap and high-level project plan with established deadlines for each project.
• A thrust for immediate implementation of project plans
• A healthier team, networks, and alignment

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Here's an extract from an article I wrote that was published in July 2005 in Professional Consultancy. As I re-read it still seemed as relevant for many of the companies I'm working with today as it did five years ago. Their focus is still on the human resource rather than human capital.

HCM is the management of an intangible and volatile organizational asset. This asset being the collective sum of the attributes, life experience, knowledge, inventiveness, energy, and enthusiasm that the organization's people choose to invest in their work.

"Like financial capital, people need to be treated with care, respect, and commitment if the organization expects them to stay invested. It must also provide them with the returns they need. Just as in managing financial capital, organizations cannot afford to waste their human capital or risk it going to places where it can get a better return. Like financial capital, human capital needs to be carefully allocated, utilized, and managed." (Lawler, 2003).

Unlike financial capital, human capital is much more of an elusive asset - it can be influenced but not controlled. People determine via their commitment to the organization and their engagement in their job whether or not to invest their capital for the benefit of the organization.

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Yesterday I got the press release for the toolkit I wrote earlier this year. It's just been published and the press release reads as follows:

"New, practical 'change tool' from the CIPD, designed to help organisations gain confidence to adapt and grow

Change and re-organisation should mean 'business as usual' for organisations in 2010, but for many it remains a challenge, particularly in difficult economic times. The launch of the latest addition to the Chartered Institute of Personnel and Development's (CIPD) collection of practical tools, focusing on change, re-organisation and the role of HR professionals within this context, will help organisations adapt and build towards a sustainable future.

The tool, Approaches to change: building capability and confidence, allows the user to think through the issues affecting their organisation, with diagnostic exercises and checklists to complete. It is designed to help HR generalists and business partners who are working to develop change management capability and supporting their staff in coping with a planned disruptive change.

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Someone just asked me about organization development in emerging markets. Is it the same as in more mature markets? What are the differences? Are new models of organization development emerging from the emerging markets? I thought these were a bunch of interesting questions - particularly since I am facilitating some organization development programs in China. The person asking me wanted me to write a technical report on this topic specifically as it related to retail banking (in emerging markets).

So there's a challenge. First of all I only had a hazy idea of what constituted an 'emerging market'. A bit of digging around suggested that there are different numbers depending on who you're asking. The listings of the World Bank, The FTSE Group, Dow Jones, and Economist all have some countries in common and some different and the numbers of countries on each range from 21 - 35. So that makes it difficult to begin with. Beyond that the World Bank and The FTSE Group strata their listings. The FTSE Group, for example "distinguishes between Advanced and Secondary Emerging markets on the basis of their national income and the development of their market infrastructure. The Advanced Emerging markets are classified as such because they are Upper Middle Income GNI countries with advanced market infrastructures or High Income GNI countries with lesser developed market infrastructures."

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Someone asked me the other day what process consulting is. Of course, I was instantly stumped because although it's a phrase and a concept that's totally familiar to me I couldn't immediately and concretely define it in a way that made the term real for the questioner.

So I went back to Edgar Schein's piece A General Philosophy of Helping: Process Consultation, Sloan Management Review; Spring 1990. In his usual, clear way he says that the best way of defining process consulting, which he says is basically a 'helping model', is to contrast it with two other forms of helping models "that seem to me substantively quite different": providing expert information, and playing doctor.

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In a results oriented world of measurement, analytics, and accountability there is little room for functions that are unable to prove that they add value to the bottom line. Evaluating the link between organizational performance and OD/HR practices is complex and there is no one right way to do it.

A report commissioned by the Institute of Personnel and Development in 1997, Impact of People Management Practices on Business Performance, Institute of Personnel and Development, sought to establish a link between HRM practices and the financial performance of organizations: one in a series of efforts to prove that HRM contributes positively to the 'bottom line'. The findings from this research did reveal a measurable impact of HRM on organisation performance and productivity.

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In today's New York Times there's an article about breast cancer diagnosis being prone to error. I read it carefully as one of my close relatives has just been told that she has breast cancer. What struck me about the article was the statement that there are

Reports in medical literature of a "wide array of variability" in interpreting breast pathology. "It is not a breach of the standard of care for one pathologist to have one opinion and another competent pathologist to have another opinion," the lawyers said.

"To recognize the problem requires you to acknowledge that there's room for improvement and that some of your colleagues are not really making the correct diagnosis," said Dr. Michael Lagios, a California pathologist"

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In a results oriented world of measurement, analytics, and accountability there is little room for functions that are unable to prove that they add value to the bottom line. Evaluating the link between organizational performance and OD/HR practices is complex and there is no one right way to do it.

A report commissioned by the UK's Institute of Personnel and Development in 1997 (Patterson, M. G., West, M.A., Lawthorn, R. and Nickell, S. Impact of People Management Practices on Business Performance) sought to establish a link between Human Resource Management (HRM) practices and the financial performance of organizations: one in a series of efforts to prove that HRM contributes positively to the 'bottom line'. The findings from this research did reveal the possibilities of demonstrating a measurable impact of HRM on organisation performance and productivity.

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In a results oriented world of measurement, analytics, and accountability there is little room for functions that are unable to prove that they add value to the bottom line. Evaluating the link between organizational performance and OD/HR practices is complex and there is no one right way to do it.

A report commissioned by the UK's Institute of Personnel and Development in 1997 sought to establish a link between HRM practices and the financial performance of organizations: one in a series of efforts to prove that HRM contributes positively to the 'bottom line'. The findings from this research revealed a measurable impact of HRM on organisation performance and productivity. The (now) CIPD has an update on this The People and Performance Link.

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'Change management' is one of those phrases that is bandied about without much consensus on what it is, why you need to manage it, and how you would manage it if you could. In an attempt to clarify this for myself I started to look around for usable information. There is a lot of information. One academic article written by Street and Gallupe, A Proposal for Operationalizing the Pace and Scope of Organizational Change in Management Studies, is helpful. The abstract reads as follows:

Organizational change is an important construct for management theorists, yet organizational research is being hampered by inconsistent and incompatible operationalizations of the construct. This article presents a proposal for improving clarity about how the types and characteristics of organizational change can be operationalized and measured. In particular, the scope and pace of organizational change are examined and a common approach is developed to measure the impacts of these two factors on patterns of organizational change.

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Day to day organization changes are continuous and people are usually able to adapt well to these: for example people leave a work team and new people join, or an IT system is upgraded, or a new policy is introduced, or an unexpected event occurs but things return to 'normal'. Where people find things more difficult is when there is a 'disruptive' change - which can be planned, as in a merger of two departments, or unplanned as when a problem is discovered (think of the recent Toyota recalls) and the landscape of the organization has to change dramatically.

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Yesterday I was facilitating a session at the HRExcellenceCenter, Organization Development Conference in Shanghai. The topic was 'consulting skills' and there was a lot of discussion on a cartoon I showed to illustrate the concepts of a 'presenting problem'. The cartoon dialogue runs like this:

Manager: I want you to design a new appraisal performance form for my group.
Consultant: But the problem is not in the form it is in the way it is used.
Manager: That may be true but we should start with a new form.
Consultant: But the form is being used successfully in other departments in the organization
Manager: Our department is different! Our people are different! We need a new form! We also need a new staff person who is truly interested in serving her client!!
Consultant: When you put it that way I suddenly see the wisdom in designing a new form.

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Last week I was in the UK running an organization design training program and meeting with various other people. It was great fun - not just catching up but also collecting a whole lot of information and suggestions on various topics that came up in the course of the conversations. So I've been spending time following up on some of those.

The first category of stuff was on websites that people have found useful. In the course of the week I looked at:

Go Ask Anyone: This website offers packs of conversation cards that trigger conversations by asking a question. The pack 'Go Ask Anyone' is a great icebreaker activity. (In fact I've used it, but then gave my pack to someone else - so it was good to get the reminder). Sample Questions: "Which three people would you combine for an ideal mate?..." "What one event in American history would you erase if you could?" "If you could know one secret or mystery, but could never tell...." Each pack has: 52 cards.

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Human Capital Management (HCM) is not the same as Human Resource Management (HRM). HCM involves strategic investment in the intangible assets that the human side of the enterprise represents. The aim is to achieve individual and organizational return on the investment in a way that develops the business, and that can be reported on an annual balance sheet if required.

HCM is the management of an intangible and volatile organizational asset. This asset being the collective sum of the attributes, life experience, knowledge, inventiveness, energy, and enthusiasm that the organization's people choose to invest in their work.

"Like financial capital, people need to be treated with care, respect, and commitment if the organization expects them to stay invested. It must also provide them with the returns they need. Just as in managing financial capital, organizations cannot afford to waste their human capital or risk it going to places where it can get a better return. Like financial capital, human capital needs to be carefully allocated, utilized, and managed." (Lawler, 2003).

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Edgar Schein presented the opening session of the 2010 Organization Design Forum Conference, currently running in Denver. His topic was the structure/process dilemma in organization design. Refreshingly he started off by saying that when he was thinking about his presentation he asked himself the question: "What are my biases that might be of some use to people thinking about this topic?"

It turns out that he is biased towards thinking about process first and structure more or less last in an organization design: a view that I share but have yet to find the majority of line managers sharing. All too often (a blanket generalization) they equate organization design with fiddling with the boxes on an organization chart.

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This week I'm working on a 'toolkit' for managers interested in developing organizational capability and effectiveness. Essentially it is a set of activities, diagnostics, checklists, and thought provokers that they can use to work out what organizational (not personal) strengths they need to have and develop to make their business successful.

One of the tools suggested by my colleagues working on this is something called 'The Nine Forces Shaping Our World'. I hadn't come across it before and found the whole concept intriguing. It set off a whole raft of questions in my mind, including:

• Why are there only nine forces (or is nine too many)?
• What is the rationale for the nine?
• What perspective about the world does the title and the list suggest?
• What can someone 'do' with the list. (I just got the list, no introduction or instructions)

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In trying to convert myself from my ThinkPad to a Mac I am driving my own behavioral change e.g. I'm slowly learning to insert my signature block manually on emails (Mac) - rather than it appearing automatically (ThinkPad), and stopping myself thinking what a ridiculous waste of time doing this is but instead getting to a level of automaticity to press the signature block key(s) before inadvertently sending with no signature block.

So when I saw a white paper from Pilat land in my inbox called 'Driving Behavioral Change' with a note from the sender saying "the thing that I find very interesting from this is the fact that individuals receive change in the brain in a way that pain is received, completely fascinating" I stopped tormenting myself with the Mac and turned to read the white paper.

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The role of an organization development consultant sometimes seems on a par with that of a marriage guidance counselor. Both are brought in sometimes as mediators, sometimes as advisors, sometimes as therapists (although this last requires specialist training), to help parties resolve issues that they cannot handle alone.

In organizational development work the interests center on power and politics - at an organizational, business unit, team and/or individual level. Tussles between head office and field offices are common, in departmental mergers or downsizing managers fight to protect their turf, personality clashes occur between individuals that get in the way of a smooth work flow, and so on.

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One of the questions raised by the group I was working with in Shanghai was "What lens should an OD consultant look through and how do I decide which lens to use?" First of all one has to understand the concept of a 'lens'. Two books explain this very well. The first Reframing Organizations by Lee Bolman and Terry Deal suggest four lens through which to view organizations, and Gareth Morgan in Images of Organization describes eight lenses. Briefly what they are both suggesting is that people interpret organizations differently according to their preferred way of looking at the world.

At simplistic level people who are 'glass half empty people', see things differently from people who are 'glass half full' - one sees the world through a pessimistic lens where things are going to go wrong, life is gloomy and people are out to thwart each other. The other approaches the world optimistically as a place of opportunity and adventure where things tend to go well and people act in the best interests of each other.

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Monday's blog (March 29) listed a set of questions concerning the handoffs and interdependencies OD consultants have with other parts of the organization. Several of these questions centered on the relationship with HR Business Partners. The UK's Chartered Institute for Personnel and Development (CIPD) has a couple of helpful factsheets on this topic - HR Business Partnering, and Organization Development.

The CIPD describes the role of the HR Business Partner as one based on the so called 'Ulrich Model' that:

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Organization Development is typically thought of as part of the HR bundle of work. In my view this is a mistake - organization development is closely related to the business strategy as a strategy cannot be delivered in the most efficient and effective way without the requisite organizational capability. Organizational capability is much more than the capability of the employees to do the work - it is about deploying capable tools, systems, processes, performance measures and so on that together with the people comprise organizational capability.

Establishing an Organizational Development Center of Excellence, or consulting unit staffed by consultants qualified in both process consulting and expert consulting in a range of business disciplines allows for a whole systems approach to organization development. It does not need to be a big unit - particularly if the aim is to work collaboratively with the client on the presenting issue, opportunity, etc with the goal of transferring OD capability to him/her. But it does have to have a clear brief, support from senior business leaders, and a mandate to operate at various levels in the organization (strategic to operational, and organizational, management, group, and individual)

An internal consulting function with this brief also acts as a bridge and control point between any external consultants employed by the organization - ensuring that they are operating in consistent way considering the benefit of the whole organization. (External consultants are often employed in a piecemeal, haphazard way which is both costly and risky).

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Running a two-day organization development workshop in Shanghai last week was food for thought. I was there at the invitation of the HR Excellence Center a membership organization that provides training, development, conferences, and other information to HR professionals. (Non-members can still participate in many of the events). It is run on similar lines to the UK's Chartered Institute for Personnel and Development and the US's Society for Human Resource Management.

Thirty attendees, for the most part from large multi-national companies, participated. The food for thought came through the huge variety of questions that participants asked. (Far from being reticent - as I'd been told to expect - there was consistent interaction, involvement, interest, challenge, and engagement.)

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This week I've been facilitating a training program on organization development (OD). One question that has come up repeatedly in different ways and at different times, is where should organization development consultants 'sit' in an organization? Delegates want to know whether organization development is best placed as part of an Human Resources (HR) function, part of a strategy department, as an independent unit reporting to a COO, or something else.

It's not an easy question to answer as different organizations have different views on the value of organization development and this perspective seems to color where it is 'put'. In a useful discussion "What kind of OD practitioner are you?" Fred Nickols suggests that:

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Here's an interesting turn. The FT recently reported that

"DSM and TNT, the Dutch life sciences group and postal operator respectively, this week join a multiplying band of companies - predominantly from the Netherlands - that link part of the bonuses senior managers receive to sustainability, an all-encompassing term that refers not only to the environment but to issues such as employee satisfaction and safety."

As they rightly point out

"The decision raises questions such as how to measure sustainability as distinct from something more tangible such as a rise or fall in a share price, and whether it makes sense to do it."

This is a particularly thorny issue since 'sustainability' is an ill-defined term. For example, if you take the reasonably well-accepted definition of the Brundtland Declaration "Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs" and try to apply this to executive pay seems you would be entering a minefield.

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What is the difficulty with evaluating OD work? There are several reasons that I've come across

• There's very little client or consultant appetite for reviewing and evaluating effectiveness, so that part of the process doesn't get built into the proposal or business case. Without making an ROI case for the evaluation piece why should it happen?

• Designing a rigorous evaluation takes time and specific skills in research methodology, internal auditing, or similar.

• Organisational circumstances move on and the focus switches to the next thing so once an intervention is either designed or implemented it becomes time to lose interest.

• On a trade off basis clients would rather put money into the more visible pieces of work than the behind the scenes pieces of work (like evaluation).

• There are no standards against which to evaluate. So while there are, for example, bodies developing 'sustainability' standards, or 'green building' standards, or 'management' standards I don't know of any bodies developing OD standards.

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Continuing from yesterday's theme one reason why there is confusion around organization development (OD) definition is that there is a lack of an underpinning theory that would give rise to a consistent, coherent, bounded, but perhaps 'agile' or 'adaptive' one. Linda Holbeche calls OD "a 'scavenger' discipline". Going on to say, "It is an eclectic field that borrows from many other disciplines and theories". (Impact, Issue 26).

So, is it an issue that there are no rigorous or unifying theories of OD - as there are theories of philosophy, religion, or medicine? Well yes, if there were a body of work that formed the basis of yardsticks for judgment and comparison, it would make for easier distinction between the types of practitioners - in the same way that, say, once someone with a medical issue is clear that they are interested in acupuncture over homeopathy, they can select the practitioner based on other factors (location, price, 'chemistry', reputation, etc). Alternatively it may not be an issue if the OD practitioner him or herself can be specific about what his/her form of OD looks and feels like in practice - in order to give potential clients accurate information on whether, to continue the analogy, they are getting a homeopathic practitioner or an acupuncturist to cure their headaches.

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I still can't answer the question 'What is organisation development?" and it's a question that I am asked a lot, particularly in terms of the relationship and distinction between organisation design and organisation development - but let's just stick with talking about the latter.

This bafflement was brought into focus again yesterday when I was asked to comment on a discussion paper "HR's role in developing OD solutions to manage change" and then complete a survey on OD. (This is open for anyone to do).

There are some reasons why I can't answer the question partly because as a researcher pointed out "It is a complicated topic ... in which there appear to be some strong and opposing views."

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