UNIT 4

This PPT contains

Organizational structure and designs and behavioural implications; organizational climate and
culture; organizational change and its management; organizational development.
Introduction
•‘Organizational Structure’ demonstrates different roles, hierarchy levels and terms, and
conditions in an organization.
•‘Organizational Design’ encompasses restructuring and de-structuring roles, hierarchy level,
terms, and conditions as per business or organizational needs.
Organization structure
•The organization structure is the system which describes the organizational hierarchy in terms
of different functions, roles, responsibilities, supervision, etc. It demonstrates different concerns
including different roles of the employees, job descriptions, job functions, decision-making
authorities, reporting structure, allocation of tasks in the department, individuals, project team,
branch, etc.
•The organizational structure also defines the flow of information between different levels of an
organization, clarity of job of each employee, and its fitment in the overall system which
motivates the employees to work efficiently by keeping their morale high; hence, increasing the
overall productivity of an organization.
Organizational Structure Is Of Two
Types
1. Centralized Structure
In this type of organizational structure, all decisions, as well as processes, are defined; and
handled by the top management. Employees and managers are responsible for the successful
implementation of decisions and have to follow them. The employees low in the chain of
command play a minimal role in the process of decision-making. Few real-life examples of such
organizations are Army, companies like Flipkart, Apple, McDonald’s, etc. where the power of
decision- making is held at the top level and there is a wide chain or hierarchy of managers and
subordinates. Thus, the centralized structure has a top-down approach for decision flow.
2. Decentralized Organization
Structure
In such type of organizations, day-to-day tasks and the decision-making processes are delegated
to the supervisors at the middle and lower level by the top management for fast and effective
decisions and to improve efficiency. By letting the middle and lower level executives jump in the
process of decision-making, the top management can focus on other major decisions. This also
increases the responsibility and accountability of the employees.
Example of decentralized structure
For Example; Mark, the HR Manager at ABC Company, has to finalize a deal with a vendor at a
job portal for hiring and, for this, he negotiates best prices with discounts to close the deal. If his
organization is a centralized one, then he will first seek senior management permission to
finalize the deal and wait for their approval.
ORGANIZATIONAL DESIGN
“Organizational Design” refers to defining, designing, and re-structuring organizational
structure. The very process of organizational design is aimed at finding any type of defective or
dysfunctional elements related to an organization’s system, organization structure, process, and
work culture. Identification of these elements leads to their rectification so that they can better
fulfil an organization’s objective.
Organizational design and organizational structure are interrelated to each other, yet have a
slight difference. The organizational structure represents organizations in an immovable or
static form that can be presented through a diagram, popularly known as “Organogram.”
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The organizational design represents the dynamic view of an organization. It is more of
processes and methods which help in organizational structuring and restructuring for smooth
and effective functioning. It is also based on change management whereby the organizational
demands change their structure and functioning to meet needs for technological advancements,
market factors, meeting regulations, customer needs and expectations, etc. With the help of the
organizational design, weaker systems of an organization can be identified and corrective steps
can be taken to strengthen them.
Elements Of Organizational Design

1. Chain Of Command/Line Of Command - The authority and power are delegated from top to
bottom i.e. in an organization top management gives instructions to the bottom team and all
the employees at each level. Further, the accountability of an employee’s job flows upward to
the management. It gives clarity of the reporting structure in an organization.
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2. Span Of Control- “Span Of Control” demonstrates how wide is the area of the direct control
of supervisors over their subordinates which is directly related to how many subordinates (in
numbers) report to a senior or supervisor; which, in turn, depends on the number of tasks
performed at different levels. In case of more tasks, the span of control will be wider. It also
depends on other aspects like geographical location, the ability of the team and superior, the
complexity of tasks, etc.
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3. Centralization- Centralization refers to centralizing an organizational system where planning
and decision-making authority is allotted either to a single person or the top management. A
decentralized organization is the one where planning and decision-making are handed over to
middle or low-levels.
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4. Specialization- Large organizations divide some of its functions based on the specialized areas
and, so, subtasks are defined in different tasks. These subtasks are distributed among individual
job roles.
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5. Formalization - Formalization refers to the process of specifying or mentioning rules,
procedures, and duties to the employees as an individual as well as to the teams, departments,
units, and the whole organization by managers in written form too. Formalization indicates the
goals and vision of an organization, tasks, hierarchy and relationships, authority and
responsibilities, different processes, and work methods.
A formal organization emphasizes on job roles, responsibilities, and assigning work to the
individuals as per the requirement of roles. These are controlled by rules and procedures.
An informal organization emphasizes on individuals, and the job responsibilities are designed
based on individual employee skills and preferences irrespective of the department in which
he/she is working. An individual can be assigned the role of different departments as well based
on self-interest, skills, etc.
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6. Departmentalization- As the name states, “Departmentalization” is the process of dividing
organizational functions into different departments as per specializations of jobs or
responsibilities so that the common tasks can be handled by specialized teams.
In rigid departmentalization, there is almost no interaction between different teams and each
team works as per their area of specialization. In contrast, in loose departmentalization, the
teams are free to interact with each other and can work together for common tasks.
Types of formal organizational design and
structure:

1. Line Organizational Structure & Design- Line organizations follow line/chain of command and
demonstrate relationships at different levels in vertical form. The authority comes from top to
bottom. There is no specialization existing in this.
2. Functional Organizational Structure
& Design
In these types of organizations, different tasks and activities are distributed to different functions and
departments i.e. sales & marketing, finance, production, purchase, HR, IT, etc. These departments have
their own staff to perform duties and hence, perform different roles.
In these type of organizations, there are two authorities of jobs or two roles exist i.e. line and
staff/function. Line authority is similar to the direct chain of command of supervision and instructions
are given by the supervisors to subordinates in a vertical chain. However, staff authority gives power to
the specialists to support and increase work efficiency of staff members of line authority with their
expertise areas. Line managers have direct authority over staff; staff or functional authority has indirect
authority over line staff members in certain but narrow specialized tasks.
For example, the diagram of functional organization given below has two departments i.e. Quality
Control and Production. Both have line authority over their respective staff and roles. The Quality
Control Department staff has staff authority over the staff of the production department for providing
support services related to maintaining and ensuring the quality of products at different production
stages through proper quality checks.
3. Line and Staff Organizational Structure & Design

This concept works mostly in big organizations. The vertical but direct relation exists at different
levels in these type of organizations where the specialist staff has the responsibility to advise
the line managers and assist them whenever required. Both the departments, i.e., line and staff
exist in such organizations. The specialized staff is present for assisting or advising and has direct
control over the line staff.
4. Divisional Organizations

Divisional organizational structure is present in large organizations which are more than one
product based, working in multiple territories or working on different projects with separate
teams. In these, the different functions of organizations are grouped on the basis of geographic
areas, products, projects, or in a combination.
Each division has its own functions and resources like manpower and others for products or the
geographic area to which it belongs.
5. Project-Based Organizations

Project-based organizations are temporary in nature and are developed to fulfil some defined
set of results for a project. These types of organizations have team members having different
skill sets from different functions or areas. Specific resources like budget, time, and manpower
are assigned in a particular project until its completion. After the completion of the project, the
manpower of the project goes back to the respective departments. For example; in the case of
IT companies where there are lots of projects like designing and developing software for any
college. To handle this, different teams of different functions of the IT department like planning,
designing, developing, testing, etc. come into play are allocated respective tasks.
6. Matrix Organizations

These types of organizations work on dual relationships in terms of responsibilities ushered over
the employees. Employees in such organizations report to both- functional head and project
head. For example, in matrix organizations, HR team members will report to the project
manager, i.e., Hiring Manager of real-estate recruitment project and the HR head for their
functional tasks.
7. Hybrid Organizations
Hybrid organizations are a combination of values and elements which are based on social
impacts in different sectors like private, public, etc. and revenue generation. Basically, when
organizations combine to fulfil the common social and profit generating goals, such
organizations are known as hybrid organizations. It is also a combination of functional and
product organizations.
Organizational Climate
According to Campbell, “Organizational climate can be defined as a set of attributes specific to a
particular organization that may be induced from the way that organization deals with its
members and its environment. For the individual members within the organization, climate
takes the form of a set of attitudes and experiences which describe the organization in terms of
both static characteristics (such as degree of autonomy) and behavior outcome and outcome-
outcome contingencies.”
Features of Organizational climate
•It is a perception of the work environment.
•It is a “psychological atmosphere.”
•It is a quick picture of the relationship between the organization and its employees.
•It is a set of properties that can be measured by the correct instruments.
•It is related to the quality and suitability of the work environment.
•It has to do with the support that employees feel they receive from the organization.
•The organizational structure strongly influences the organizational climate.
•The organizational climate is a reflection of the degree of employee motivation.
•It has positive and negative effects on people’s behavior in the workplace.
Characteristics of Organizational
Climate
1. General Perception: Organizational climate is a general expression of what the organisation is. It is
the summary perception which people have about the organisation. It conveys the impressions people
have of the Organizational internal environment within which they work.
2. Abstract and Intangible Concept: Organizational climate is a qualitative concept. It is very difficult to
explain the components of Organizational climate in quantitative or measurable units.
3. Unique and District Identity: Organizational climate gives a distinct identity to the organization. It
explains how one organization is different from other organizations.
4. Enduring climate - Organizational climate built up over a period of time. It represents a relatively
enduring quality of the internal environment that is experienced by the organizational members.
5. Multi-Dimensional Concept: Organizational climate is a multi- dimensional concept. The various
dimensions of the organizational climate are individual autonomy, authority structure, leadership style,
pattern of communication, degree of conflicts and cooperation etc.
Factors influencing Organizational
Climate
(i) Organizational Structure: Perceptions of the extent of organisational constraints, rules,
regulations, red tape,
(ii) Individual Responsibility: Feeling of autonomy of being one’s own boss,
(iii) Rewards: Feelings related to being confident of adequate and appropriate rewards,
(iv) Risk and Risk Taking: Perceptions of the degree of challenge and risk in the work situation,
(v) Warmth and Support: Feeling of general good fellowship and helpfulness prevailing in the
work setting.
(vi) Tolerance and Conflict: Degree of confidence that the climate can tolerate, differing
opinions.
Impact of Organizational Climate
1. Constraint System: Organisational climate can operate as a constraint system in both the
positive and negative sense. This can be done by providing information to the employees about
what kind of behaviour will be rewarded, punished or ignored. Thus, behaviour can be
influenced by varying degrees of rewards and punishments. Such a constraint system would
influence the behaviour of those people who are most interested in those specific values which
are assigned to different behavioural outcomes.
2. Evaluation of Self and Others: Organisational variables may affect behaviour through
evaluation of self and others. In this evaluation process both the physiological and psychological
variables will be associated. Such evaluation will affect the human behaviour.
3. By Acting as Stimuli: Organisational factors can influence human behaviour by acting as
stimuli. As stimuli they influence individual’s arousal level, which is a motivational variable
directing human behaviour. The level of arousal will directly affect the level of activation and
hence performance.
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4. By Helping the Individual to Form a Perception: Organisational factors influence the
behaviour by helping the individual in forming a perception of the organisation. The perception
then influences behaviour. Thus, good organisational climate is instrumental to higher employee
satisfaction, better human relations and higher productivity, the role of climate can be
explained with the help of the following figure.
Types of Organizational climate
1.- People Oriented Climate: The culture which is mainly comprised of a core set of values that
emphasize care and concern for the people of that organization.
2.- Rule Oriented Climate: A culture with these featured values, focus attention to detail by all
its members, and therefore the culture results in a climate that was very much rule-oriented.
3.- Innovation Oriented Climate: When you seek from your team
the introduction of new methods and procedures as well as to develop the ability to try new
things you are in front of an innovation oriented culture.
4.- Result Oriented Climate: The culture of any organization becomes result oriented when it
values results so much that every detail of every process is directed to achieving and refining
results.
ORGANIZATIONAL CULTURE
•Organizational culture includes an organization’s expectations, experiences, philosophy, as well
as the values that guide member behavior, and is expressed in member self-image, inner
workings, interactions with the outside world, and future expectations.
•Organizational culture is the collection of values, expectations, and practices that guide and
inform the actions of all team members. Think of it as the collection of traits that make your
company what it is. A great culture exemplifies positive traits that lead to improved
performance, while a dysfunctional company culture brings out qualities that can hinder even
the most successful organizations.
Qualities of great Organizational
culture
Alignment comes when the company’s objectives and its employees’ motivations are all pulling
in the same direction. Exceptional organizations work to build continuous alignment to their
vision, purpose, and goals.
Appreciation can take many forms: a public kudos, a note of thanks, or a promotion. A culture
of appreciation is one in which all team members frequently provide recognition and thanks for
the contributions of others.
Trust is vital to an organization. With a culture of trust, team members can express themselves
and rely on others to have their back when they try something new.
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Performance is key, as great companies create a culture that means business. In these
companies, talented employees motivate each other to excel, and, as shown above, greater
profitability and productivity are the results.
Resilience is a key quality in highly dynamic environments where change is continuous. A
resilient culture will teach leaders to watch for and respond to change with ease.
Teamwork encompasses collaboration, communication, and respect between team members.
When everyone on the team supports each other, employees will get more done and feel
happier while doing it.
Characteristics of Organizational
culture
1. Innovation (Risk Orientation)- Companies with cultures that place a high value on innovation encourage their
employees to take risks and innovate in the performance of their jobs. Companies with cultures that place a low
value on innovation expect their employees to do their jobs the same way that they have been trained to do
them, without looking for ways to improve their performance.
2. Attention to Detail (Precision Orientation)- This characteristic of organizational culture dictates the degree to
which employees are expected to be accurate in their work. A culture that places a high value on attention to
detail expects its employees to perform their work with precision. A culture that places a low value on this
characteristic does not.
3. Emphasis on Outcome (Achievement Orientation)- Companies that focus on results, but not on how the
results are achieved, place a high emphasis on this value of organizational culture. A company that instructs its
sales force to do whatever it takes to get sales orders has a culture that places a high value on the emphasis on
outcome characteristics.
4. Emphasis on People (Fairness Orientation)- Companies that place a high value on this characteristic of
organizational culture place a great deal of importance on how their decisions will affect the people in their
organizations. For these companies, it is important to treat their employees with respect and dignity.’
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5. Teamwork (Collaboration Orientation)- Companies that organize work activities around
teams instead of individuals place a high value on this characteristic of the organizational
culture. People who work for these types of companies tend to have a positive relationship with
their coworkers and managers.
6. Aggressiveness (Competitive Orientation)- This characteristic of organizational culture
dictates whether group members are expected to be assertive or easygoing when dealing with
companies they compete within the marketplace. Companies with an aggressive culture place a
high value on competitiveness and outperforming the competition at all costs.
7. Stability (Rule Orientation)- A company whose culture places a high value on stability is
rule-oriented, predictable, and bureaucratic in nature. These types of companies typically
provide consistent and predictable levels of output and operate best in non-changing market
conditions.
These are the seven characteristics that are common in the context of organizational culture.
Organizational Change
Organizational change refers to the actions in which a company or business alters a major
component of its organization, such as its culture, the underlying technologies or infrastructure
it uses to operate, or its internal processes. Organizational change management is the method
of leveraging change to bring about a successful resolution, and it typically includes three major
phases: Preparation, implementation, and follow-through.
Causes of Organizational Change
•Many factors make organizational change necessary. Some of the most common faced by
managers include:
•New leadership at the helm of the company or within its departments
•Shifts in the organizational team structure
•The implementation of new technology
•The adoption of new business models
TYPES OF
CHANGE
 Types of Change
In the fast-changing business environment, the contemporary organization’s
must learn to be more adaptable and flexible for successfully facing the
environmental challenges. Most of the organizational changes are implemented
in a planned manner for realizing the specific objectives or goals. However,
organizational change can be implemented in any one of the following ways as
described below:
1. Planned Change
2. Unplanned Change
1. Planned Change
PLANNED INTERNAL CHANGE: Planned internal change can be regarded
as a strategic move by the organization implemented with the objective of changing the nature
of the business itself or the way in which an organization is doing its business. This can be
administered in one of the following ways:
Changes in the Services or the Products: An organization usually goes ahead with the decision
of a Planned Internal Change, if the management decides to diversify it’s range of business or a
need is felt by the management for providing a new direction to the business or reviving the
business by adding new service or product lines. Such a planned internal change will require a
fair amount of pre-planning, effective coordination and resource distribution as well for meeting
the objectives of change.
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Changing the Administrative Systems: Changes in the administrative systems are implemented
or enforced by an organization for enhancing administrative efficiencies, or for improving the
company’s image or for gaining the advantage of being a political power within an organization.
The pressure to change the administrative systems comes from the top level of the
management (top-down approach). On the other hand, if there is a requirement for changing
the very nature of work itself in an organization (changing the technical core), bottom-upward
approach for the change is usually adopted. Previous studies have identified that organizations
which are more mechanistic instead of being organic in its approach, in other words, which are
more centralized and formal in nature, tend to achieve a greater degree of success in
successfully implementing administrative change.
Changes in the organizational structure and size: Organizational restructuring or changes in the
hierarchical framework is introduced in an organization for the realization of pre-defined
objectives or goals.
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PLANNED EXTERNAL CHANGE -- Organizations as a system is
governed by both internal factors as well as external factors of change. Various factors like technological
innovation and advancements in the communication and information processing field come under this
category. These factors are external in nature but somehow are introduced in an organization in a
planned manner with the objective of enhancing work efficiencies and improving the overall
productivity.
Technological Innovation: Rapid technological changes have necessitated a change in the ways in which
the contemporary organizations function. Technological development has altered the ways in which
people handle their jobs. For example, in the automobile industry, a large part of the design and
manufacturing process has been automated and equally depends on IT. Siemens (Germany) holds the
credit for being the world’s first paperless office.
Advancements in Communication and Information Processing: In the present era, with the revolution
in the communication technology and advancements in the information processing technologies like
satellite communication technology, fiber optic cables, wireless technology and networking, etc., it has
become much easier and convenient for the businesses to communicate with the business partners and
also with the clients.
2. Unplanned Change
UNPLANNED INTERNAL CHANGE: Unplanned internal change can
be regarded as a change which takes place within an organization not in a planned manner or as a
strategic intervention, but are introduced in an unplanned manner in response to either a change in the
demographic composition of an organization or due to performance gaps.
Change in the Demographic Composition: With increasing number of women workforce joining the
organization and in addition to this older employees joining private sector jobs after completing their
tenure in public sector or government sector and also increasing composition of diverse workforce in
organization's as a result of globalization of worldwide economies, the demographic compositions of
the workforce has undergone a sea change in the present scenario. The rapid change in the
demographies will compel organizations to change.
Performance Gaps: Performance gaps associated with an organization either in the form of depleting
profit margins or non-performance of a product line or service in the market or slowdown in sales due
to unexpected reasons, can compel an organization to change. Research studies have proven that
performance gaps act as propellants for organizational innovations.
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UNPLANNED EXTERNAL CHANGES: Two crucial factors like
economic uncertainties and changes in the government regulations, play a crucial role in compelling
organizations to change.
Governmental Regulation: Changes in the governmental regulations greatly influence the very nature
of business of an organization and how the organizations operate in a highly competitive environment.
Due to economic globalization and liberalization, government has enforced changes in the regulations in
the form of de-licensing, currency conversion, etc., for supporting the domestic organizations to stay
competitive and achieve the expected profit margins.
Global Economic Competition: Global economic conditions create competitive pressures on the
organizations and force them to change for capturing a decent market share, achieve a winning edge in
the international marketplace and expansion of customer base through aggressive advertisement and
communication campaigns. In the era of globalization, the formidable challenge for the organizations
for staying ahead in the competitive race is to remain innovative and to position itself as a unique
brand.
Conclusion
Thus, it can be interpreted that managing organizational change is one of the most essential
pre-requisite for adapting with the competitive challenges and transitioning from the present
state of business to a desired futuristic course of action. It is vital to develop and implement a
plan of action for managing change successfully.
Forces of change
External forces Internal forces

Technology ◦ Changes in managerial personnel

Market conditions ◦ Changes in operative personnel
Social forces ◦ Deficiencies in existing structure
Political forces
Causes of resistance to change
Resistance to change is a type of human behaviour which arises to protect human beings from
the real or perceived effects of change.
Resistance to change may occur at an individual and group levels and also at the organisational
levels
Causes of resistance to change
Individual/ group resistance Organisational resistance
◦ Economic factors ◦ Threat to power
◦ Psychological factors ◦ Organisational structure
◦ Social factors ◦ Resource constraints
◦ Sunk costs
Techniques of overcoming resistance to
change
Effective communication of change
Consultation with union leaders
Education and training of subordinates
Facilitation and support for change
Negotiation ( bargaining) with subordinates
Manipulation and cooperation
Coercion or pressure to accept change
Definition of OD
The term organization development is used to capture the developmental
efforts or the planned changes that are made in organizations on an on-going
basis to improve the vitality of the organization and its members.
OD is a planned, systematic, organized, and collaborative effort where
behavioral science and organization theory principles and practices are
continuously applied in order to increase the quality of life which is reflected
in increased organizational health and vitality, enhanced individual and group
members’ competence and self-worth, and the general overall well-being of
society.
According to Beckhard, “Organization development is an effort (1) planned (2)
organization-wide and (3) managed from the top to (4) increase organization
effectiveness and health through (5) planned interventions in the
organization’s ‘processes’, using behavioral science knowledge”.
Elements and Nature of OD
1. Planned change: OD is Planned evolution and improvement. This planning includes examining the present and
systematically diagnosing the organization’s needs, formulating specific plan for improvement, and mobilizing the
organizational resources needed to carry out the change.
2. Organization wide: The goal of OD is to improve the effectiveness of the total organization, although specific
aspects may focus on subsystems. The underlying view is that an organization is a system of inter-related parts.
3. Managed from the top: In an OD effort, the manger is a key element to success. Of the change to work well,
commitment from top management is crucial because it serves as a standard for the rest of the organization’s
members.
4. Organizational effectiveness: The object of OD is to increase the health and effectiveness of the organization.
According to Beckhard, the healthy organization manages in terms of established goals; the organization is
properly designed; decisions are made at the appropriate level; communications are relatively undistorted;
win/lose activities are minimized; there is high ‘conflict’ regarding projects and the tasks (clash of ideas), but
relatively little clash over interpersonal difficulties; there is emphasis on helping each person grow and develop;
and the organization is open and adaptive in an ‘action-research’ way.
5. Planned interventions: These are the strategies an organization develops for using behavioral science
knowledge to help it better understand its current methods of work, its norms and values and to help it examine
alternative methods of relating and rewarding its members.
 Characteristics of OD
1. System Orientation: Organization development is system oriented. It is concerned with the
interactions of the various parts of the organization which affect each other. It lays stress on
intergroup and interpersonal relationship. It is concerned with structure and process a well as
attitudes.
2. Use of Change Agent: Organization development is generally implemented with the help one or
more change agents, whose role is to stimulate, facilitate, and coordinate change. The change agent
usually acts as a catalyst, sparking change within the system while remaining somewhat
independent of it. Although change agents may be either external or internal, they are usually
consultants from outside the company. Advantages of using external change agents are that they
are more objective and have diverse experiences. They are also able to operate independently
without ties to the hierarchy and politics of the firm.
3. Problem Solving: Organization development is concerned with the problem solving. It seeks to solve
the problems through practical experiences gained on the work and not merely through theoretical
discussion as in a class room. These problems mainly occur at the time when working on the job.
This focus on improving problem-solving skills by discussing data-based system problems is called
action research. In other words, employees are “learning how to learn” from their experiences, so
they can solve new problems in the future.
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4. Experimental Learning: Organization development provides experimental learning to help the
participants learn new behavior patterns through experience. They can discuss and analyze their
own immediate experience and learn from it. This approach tends to produce more changed
behavior than the traditional lecture and discussion, in which people talk about abstract ideas.
Theory is necessary and desirable, but the ultimate test is how it applies in a real situation.
5. Human Values: OD programs are often based on humanistic values. The values are positive
beliefs about the potential and desire for growth among employees. To be effective and
self-reviewing, an organization needs employees who want to increase their skills and
contributions. The best climate for this to happen is one that creates opportunities for growth by
stressing collaboration, open communications, interpersonal trust, shared power, and
constructive conformation. They all provide a value base for OD efforts and help ensure that the
organization will be responsive to human needs.
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6. Contingency Orientation: Organization development is situational and contingency oriented. As
people learn to develop their behavioral concepts through experience, they can suggest various ways to
solve a particular problem and to adapt any of them most suited in the present circumstances. Thus, OD
is flexible and pragmatic, adapting actions to fit particular needs.
7. Levels of interventions: OD programs are aimed at solving problems that may occur at the individual,
interpersonal group, inter-group and total organizational level. OD interventions are designed for each
level as for instance career planning at the individual level, team building at the group level.
8. Feedback: Organization development supports feedback to participants so that they may be able to
collect the data on which decisions are based. For this purpose participants may be divided into several
groups according to the functions. Each such group takes its own decision on the subjects referred to it,
and then, the decisions foreword to the other group for feedback. Each group comes to know the
impression of other groups about it and then groups meet together to thrash out any misunderstanding
developed among them. In this way, decisions of each group are checked by other groups and the final
decision is reached.
Objectives of OD
To apply behavioral science theories: The first objective of organization development is to apply some
behavioral science theories in the organization. By applying these theories organization development
practices hope for development.
To improve organizational performance: Another objective of organization development is to improve
the overall performance of organization. Thus organization can be established as one of the important
institutions in human history.
To ensure proper use of individual efforts: Individual performance should be improved. This is possible
by using individual efforts properly. Organization development ensures proper use of human efforts and
commitment.
To create awareness: Organization development crates awareness among the people working in the
enterprise. They feel the need for change in comparison with other organizations.
To encourage people to solve problems: Every organization has many problems and challenges.
Organization development encourages people to solve these problems and face challenges at present
and future.
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To minimize resistance to change: In most of the cases, every change is resisted, it hampers goal
achievement. Organization development helps minimize the resistance to change in a positive mood so
that management becomes more alert.
To create job satisfaction: Job satisfaction encourages the people to work hard with joy. Organization
development creates job satisfaction of employees who are involved in organization development
activities.
To increase motivation level: Motivation creates interest for work among the employees. Therefore
another important objective of organization development is to increase motivation.
To create supportive values: Every organization and employee has some values and norms. The values
and norms can help the organization to uphold its own culture. Organization development creates
supportive suitable values and norms.
To increase knowledge & skills: Knowledge on latest methods and skills can streamline the growth of
any organization. Organization development intends to increase the knowledge and skill levels through
training.
Interdisciplinary nature
of OD
 Explanation
Organization development as a practice involves an ongoing, systematic process of implementing
effective organizational change. OD is both a field of applied science focused on understanding and
managing organizational change and a field of scientific study and inquiry.
It is interdisciplinary in nature and draws on sociology, psychology, particularly industrial and
organizational psychology, and theories of motivation, learning, and personality.
Although behavioral science has provided the basic foundation for the study and practice of OD, new
and emerging fields of study have made their presence felt. Experts in systems thinking,
in organizational learning, in the structure of intuition in decision-making, and in coaching whose
perspective is not steeped in just the behavioral sciences, but in a much more multi-disciplinary and
inter-disciplinary approach, have emerged as OD catalysts or tools.
Behavioral sciences as industrial/organizational psychology, industrial sociology,
communication, cultural anthropology, administrative theory, organizational behavior, economics,
and political science, are main disciplines to help the organization define and solve its own problems.
Managing the OD
process
Explanation
1. Initial Diagnosis of the Problem: In the first step, the management should try to find out an
overall view of the situation to find the real problem. Top management should meet the
consultants and the experts to determine the type of program that is needed. In the first stage
only, the consultants will meet various persons in the organization and interview them to collect
some information.
2. Data Collection: In this stage, the consultant will make the surveys to determine the climate of
the organization and the behavioral problems of the employees.
The consultant will meet groups of people away from their work environment to get some
answers to the questions such as:
(i) What specific job conditions contribute most to their job effectiveness?
(ii) What kind of conditions interferes with their job effectiveness?
(iii) What changes would they like to make in the working of the organization?
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3. Data Feedback and Confrontation: The data which has been collected in the second step will
be given to the work groups, who will be assigned the job of reviewing the data. Any areas of
disagreement will be mediated among themselves only and priorities will be established for
change.
4. Planning Strategy for Change: In this stage, the consultant will suggest the strategy for
change. He will attempt to transform diagnosis of the problem into a proper action plan involving
the overall goals for change, determination of basic approach for attaining these goals and the
sequence of detailed scheme for implementing the approach.
5. Intervening in the System: Intervening in the system refers to the planned programmed
activities during the course of an OD program. These planned activities bring certain changes in
the system, which is the basic objective of OD. There may be various methods through which
external consultant intervene in the system such as education and laboratory training, process
consultation, team development etc.
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6. Team Building: During the entire process, the consultant encourages the groups to examine
how they work together. The consultant will educate them about the value of free
communication and trust as essentials for group functioning. The consultant can have team
managers and their subordinates to work together as a team in OD sessions to further encourage
team building. Following the development of small groups, there may be development among
larger groups comprising several teams.
7. Evaluation: OD is a very long process. So there is a great need for careful monitoring to get
precise feedback regarding what is going on after the OD program starts. This will help in making
suitable modifications whenever necessary. For evaluation of OD program, the use of critique
sessions, appraisal of change efforts and comparison of pre and post training behavioral patterns
are quite effective.
Values and assumptions
of OD
 Values of OD
1. Respect People: People are the raison d’etre of organization and they are responsible for creating opportunities for growth. They
must, therefore, be treated with respect and dignified manners.
2. Confidence and Support: Organizations are made up of people and they are to be believed and supported in order to have effective
organization. The healthy environment prevails when people are trusted and taken into confidence and a necessary support is extended
to them as and when needed.
3. Confrontation: Any conflict on any issue should not be suppressed. It should be dealt with openness. Suppression leads to dampening
of morale. Identifying the problem and its causes, discussing it openly and finding out feasible solution leads to boosting up morale of
the employees and creating good environment.
4. Employee Participation: The participation of employees who will be affected by the OD should be sought in decision-making.
5. Expression: Human beings differ in experience, maturity, ideas, opinions, and outlook. The organization is at the receiving end. It
gains from the differences in quality, ideas, opinions and experiences of its people. Human beings are social animals; they have feelings,
emotions, anger and sentiments etc. They should be allowed to express their feelings and sentiments. This will result in building up high
morale and the people will be motivated towards hard work ultimately resulting in increased efficiency.
6. Seeking Cooperation: Managers should learn to seek cooperation from each of the employees working under him in his department.
This will develop in creating the atmosphere of cooperation leading to organizational effectiveness and willingness to accept change in
the event of organization development process.
Assumptions of OD
The Organization development has a number of underlying assumptions which can be examined
so as to determine how the OD program can be utilized to the fullest potential.
These assumptions are based upon French and Bell.
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1. Most individuals have drives towards personal growth and development-
The work habits are a response to work environment rather than personality traits.
Accordingly, efforts to change work habits should be directed towards changing how the person is
treated rather
2. Highest productivity can be achieved when the individual goals are integrated with organizational
goals than towards attempting to change the person-
Also with such integration, the quality of the product is highly improved.
3. Cooperation is more effective than competition-
Conflict and competition tend to erode trust, prohibit collaboration and eventually limit the
effectiveness of the organization.
In healthy organizations, “efforts are made at all levels to treat conflict as a problem subject to problem
solving methods”.
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4. The suppression of feelings adversely affects problem solving, personal growth and satisfaction with
one’s work-
Accordingly, free expression of feelings is an important ingredient for commitment to work.
5. The growth of individual members is facilitated by relationships, which are open, supportive and
trusting-
Accordingly, the level of interpersonal trust, support and cooperation should be as high as possible.
6. The difference between commitment and agreement must be fully understood-
Agreeing to do something is totally different from being committed to do something.
Sense of commitment makes it easy to accept change and the implementation of change for the
purpose of organizational development is even easier when such a commitment is based upon
participation in the process.
7. Organization development must be reinforced by the organisation’s total human-resources system.