What is organizational development? (Goals, process, and guide)

You walk into a company where every employee feels energized, the teams are in sync, and the business is thriving. These are signs of a company that’s nailed organizational development (OD).

But what is organizational development? It’s a process that involves planned changes to improve an organization’s efficiency and effectiveness by aligning its activities with its goals and vision.

This doesn’t happen overnight, though. It takes time and effort, and sometimes it’s a bit of a grind. But it pays off big time. Better teamwork, more innovative processes, and a place where everyone’s pumped to come to work — that’s the dream, isn’t it?

Organizational development is a big deal for any business. You have to ensure everyone is pulling in the same direction, understanding the company’s goals, and motivated to work toward them. But getting there? It’s not always straightforward. You need the right tools to help everyone stay on track, communicate better, and keep improving.

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Organizational development isn’t a quick fix. Whether you’re part of a startup or own a large-scale business, embracing organizational development can lead to transformative changes.

So why should you care? Whether you’re running the show or part of the team that makes it all happen, organizational development makes work less like work and more like a team sport where everyone’s winning.

In this article, we’ll walk you through what it is, why it’s a must-have, and how it can make a difference in any business. Ready? Let’s go!

Understanding organizational development

Let’s get down to the nitty-gritty of organizational development. What is it exactly? Well, think of it as giving a company its growth strategy — not just in terms of profits or size but in how it operates on a day-to-day basis, how the team bonds together, and how it faces new challenges.

Organizational development is planned, systematic, and considers the people, processes, and structure of an organization. Now, why do we need it? Simple. Change is always happening. Markets shift, new tech pops up, and what worked yesterday might not cut it tomorrow.

So, how does organizational development work? It starts with a good look at the current state of affairs. What’s going great, what’s not, and what’s “meh”? Then, you set goals. Not just any goals, though — smart ones that push the company to grow correctly. You need to consider every detail, like how a team communicates, how decisions are made, and how work gets done daily. It can mean rethinking old policies, shaking the status quo, or introducing new ways to boost productivity and job satisfaction.

One thing you can do to rethink old processes is implement new technology. Imagine seeing at a glance how adjustments in one area of your organization affect the overall timeline and goals of other areas. That’s the power of integrating Gantt charts into your organizational development strategy. With Wrike’s Gantt charts, you can clearly represent your project timelines, including task dependencies and milestones. You can easily plot out the sequence of actions needed to achieve organizational development goals, ensuring that each task is automatically scheduled right after the preceding one.

History and evolution of organizational development

Let’s take a stroll through history to see how OD has become today’s powerhouse tool for transforming organizations. Back in the 1920s and 1930s, the foundation of OD was laid. This period saw the emergence of human relations studies, particularly the Hawthorne effect, which highlighted the impact of social relations and worker satisfaction on productivity.

Fast forward to the 1950s, a time of innovation and the actual birth of OD as a field. Influential thinkers like Kurt Lewin began to apply behavioral science to organizational change. Lewin’s change model — unfreeze, change, refreeze — became a guiding principle for managing organizational change. The term “organizational development” was coined during this decade, bringing a more systematic and planned approach to implementing change.

The 1970s and 1980s brought economic turmoil, which forced organizations to focus on efficiency and effectiveness. OD practitioners began to incorporate strategic planning and corporate culture into their work. OD later faced new challenges and opportunities as the digital age dawned in the 1990s and early 2000s. Technology started revolutionizing the workplace, and OD had to adapt. The rise of the internet and global communication meant that change was happening faster than ever, and organizations needed to be agile to keep up.

Goals of organizational development

The main goals of organizational development include:

Enhance organizational effectiveness

You’ve got a team, a playbook, and a game to win. How do you ensure your team is playing and scoring those points effectively? That’s where organizational development (OD) steps in. OD says, “Let’s get this team in shape!” You look at the processes, structures, and systems in place and ask, “Can we do better?” And guess what? The answer is almost always a resounding “Yes!” Whether it’s streamlining communication or redefining roles, you need to ensure everyone’s playing to their strengths.

You can optimize your task management with project management software templates to track your team’s objectives and progress. For instance, Wrike’s agile teamwork template can help you prioritize tasks, manage sprints, and track progress all in one place.

Then there’s the attendance tracker template, which keeps tabs on employee attendance rates, offering a clear view of who’s in the game and on the bench. You can organize tasks in folders by team or department using the action plan template, moving projects from “To Do” to “In Progress” to “Completed” in one click.

Improve employee satisfaction and performance

Now, let’s talk about the employees who make it all happen. OD looks at the work environment and asks, “Are we creating a superstar environment here?” You need to ensure that people are engaged, motivated, and ready to bring their best to work.

The goal is to understand what makes employees happy. You need to provide opportunities for growth, recognize achievements (high-fives all around!), and make sure the workplace is more “We’ve got this!” and less “Oh no, not this again.” When employees are satisfied, they perform better.

Facilitate change and adaptability

The only constant out there is change. Businesses can stay responsive and proactive to industry and external changes by identifying and implementing effective change management strategies.

If an organization is facing a significant change, such as a merger or acquisition, an OD consultant can aid in developing a change management plan that addresses the concerns of employees and stakeholders.

On the subject of change management, according to Wrike’s “Dark Matter of Work” report, a staggering 91% of business leaders witnessed digital transformation accelerate due to the pandemic, a shift fundamentally altering the traditional workplace. Now, 84% of these leaders see the move to hybrid working as an irreversible trend, with 75% of knowledge workers affirming they’re never returning to pre-pandemic work styles.

These figures paint a clear picture: the future of work is hybrid, and organizational development strategies must pivot to accommodate this new normal.

Find out how Wrike can help you manage a hybrid workplace without any hassle — start your free trial now.

Key components of organizational development

The key components of OD include organizational assessment, intervention strategies, and evaluation and feedback. Let’s examine each of these components further:

Organizational assessment

The first step in OD involves gathering data and analyzing the organization’s current state. What’s working? What’s not? Where are we losing steam? You’ve got a map (your organization), and you’re looking for spots to dig for gold (areas of improvement). You’re not just wandering around with a shovel; you’re assessing the terrain, looking for clues, and marking the best spots. That’s your organizational assessment — it’s the strategic search for opportunities to strike gold in productivity and performance.

In measuring performance, you can boost your decision making with advanced analytics, where you can turn raw data into actionable insights. Imagine having a dashboard that presents data and brings it to life with interactive widgets. Wrike’s advanced analytics feature allows you to drag and drop tables, charts, or boards that crystallize complex information into clear insights.

Intervention strategies

Once you’ve mapped out where you need to dig, it’s time to grab that shovel — or, in our case, an intervention strategy. These are your action plans, the steps you take to shake things up and improve. Intervention strategies are all about action. Did you notice a communication breakdown? Maybe it’s time for some team-building exercises or a new chat tool. Intervention strategies are bold moves that say, “We’re not just going to stand here; we’re going to do something about it!”

Evaluation and feedback

Lastly, there’s evaluation and feedback. After you’ve put those strategies into play, you’ve got to circle back and ask, “Did it work?” This is your reality check. This stage is important because you learn from what you’ve done. Maybe that bridge wobbled a bit, and you need to reinforce it. Or perhaps it’s holding up like a champ, and it’s time for a high-five. Evaluation and feedback involve continuous learning, tweaking, and improving. The loop keeps you moving forward, smarter and more equipped for the next challenge.

The organizational development process

Let’s dive into the specific steps of the organizational development process.

Step 1: Identify the need for change

Have you ever had that “Something’s gotta give” feeling? That’s what we’re talking about here: the realization that something in your organization needs to change to move forward. Maybe customer satisfaction scores are dropping, or your team is burning out. The first step is acknowledging the warning signs and deciding it’s time to do something about it.

Identifying the need for change is a wake-up call. It requires you to be proactive and listen to what’s happening around you. Feedback from customers and employees can be eye-opening. Look at your competitors, too. What are they doing that you’re not? Gathering this information helps you pinpoint exactly where change is needed.

This step doesn’t just revolve around spotting problems; it helps you recognize opportunities, too. Maybe there’s a new market you could enter or a more efficient way of working that could boost productivity. You ask questions like, “Where do we want to be?” and “What’s stopping us from getting there?”

Step 2: Collect and analyze data

This stage involves collecting relevant information to identify the issues, needs, and opportunities for change. During this step, you’ll also collect data to understand the problems or opportunities you’ve identified.

Surveys, interviews, performance metrics, and market analysis are your tools for step 2. You’re collecting evidence to help you make informed decisions. Once you’ve got your data, it’s time to analyze. You find patterns, identify trends, and get to the root causes of the problems.

This might reveal some hard truths, but it’s all part of the process. The goal is to have a clear picture of the current state of things so you can plan your next moves effectively.

Step 3: Make an action plan

With a clear understanding of what needs to change, it’s time to make a plan. This step turns insights into action. What specific changes will you make? Who will be responsible for each part? What resources will you need? It’s important to set clear goals and timelines here. Think SMART — be specific, measurable, achievable, realistic, and time-bound.

Step 4: Monitor and evaluate

You’re in the thick of it now, but how do you know if your efforts are actually paying off? That’s why you should monitor and evaluate. This step tracks progress and measures the impact of your implemented changes.

Use the goals you set in Step 3 as your guide. Are you meeting them? If not, why? This is a chance to learn from what’s working and what’s not. Be honest with yourself and your team. If something isn’t working, don’t be afraid to pivot. The goal is to stay focused on your ultimate goals and strive toward them.

Step 5: Sustain the change

Finally, you’ve made some changes and seen some improvements, but how do you make sure these changes last? Sustaining change means ensuring that new processes, behaviors, and mindsets become the norm, not just a one-off initiative.

This might involve training programs, updating policies, or simply continuing to champion the new way of doing things. Keep the lines of communication open and continue to seek feedback. It’s also important to keep monitoring performance and adjusting as needed. The goal is to ensure that the changes you’ve worked so hard to implement continue to deliver value over the long term.

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Organizational development is a necessary process to succeed

And that’s a wrap. We’ve taken quite the journey through the ins and outs of organizational development. From understanding its basics and history, explaining its goals, and diving into its key components, I hope you’ve picked up a thing or two along the way!

Now, you might be wondering, “What’s next? How do I put all this knowledge into action?” Start small. Pick one area you think could boost — for example, improving team communication with Wrike’s templates, laying out your course with Gantt charts, or streamlining processes with advanced analytics.

Here’s how Brynne Roberts, Director of Creative Operations at Fitbit, outlined her experience with Wrike’s project management software:

“We work faster, update key dates for deliverables much more quickly, and eliminate human error. We’ve likely saved around 200 or more hours per year in our launch prep.”

So, why not give Wrike a shot? Who knows, the next success story could be yours.

With Wrike managing your operations, you’re already one step closer to making it happen.

Note: This article was created with the assistance of an AI engine. It has been reviewed and revised by our team of experts to ensure accuracy and quality.