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Organizational development, or organization development (“OD” for short), is the action-oriented practice of moving an organization toward achieving its objectives by enabling and motivating people to manage, drive, and embrace organizational change.

Still want to know more? Here I’ll delve deeper into what organizational development is, how it relates to human resources management, the OD process, and some key skills.

What Is Organizational Development?

Organizational development theory has been percolating since the 1930s when research showed that organizational behavior influenced employee behavior, performance, and group dynamics. 

Research also demonstrated that the structure of the organization (e.g. hierarchical, flat, team-based) affected its success.

There are many alternative definitions of OD. 

For example, the book “Health Behavior and Health Education” defines organizational development as, “a field of research, theory, and practice dedicated to expanding the knowledge and effectiveness of people to accomplish more successful organizational change and performance.” 

Wikipedia, on the other hand, defines OD more simply as, “the study of successful organizational change and performance.” 

While both are useful definitions, neither of them addresses some of the most important factors in successful organizational development. 

Let’s unpack the definition of organizational development from above and examine what these aspects are.

Action-oriented practice

The research, theory, and behavioral science behind OD is very important. For example, you might conduct action research to plan how to make your company more diverse and inclusive. 

However, effective organizational development requires you to take action on those plans such as making the necessary modifications to hiring and promotion practices and working to change the behavior of employees to align with the new practices.

OD activities are generally categorized as either assessments or interventions

OD assessments

OD assessments involve using research and data to determine organizational effectiveness in certain business processes such as onboarding or recruiting, which then informs potential OD interventions. 

Decision-making around whether or not to undertake an intervention is based on the results of the OD assessment. 

OD interventions

OD interventions are the actual actions taken, and techniques used, to drive the organizational change. 

For example, an employee engagement or satisfaction survey might be used as an assessment tool to drive changes to the organizational structure or employee compensation programs (interventions).

It's important that OD assessments and OD interventions are rooted in research, data, and analytics, rather than anecdotal evidence or case studies around interventions that worked for other companies. 

Each organizational structure and culture is different and needs unique OD processes and outcomes. 

The OD process can be applied to many business activities, including leadership development, performance management, change management, organizational performance, organizational culture, org design, and training and development programs.

OD Assessments vs OD interventions. The assessments are used to determine the effectiveness of certain business processes while interventions are the actions taken.

Moving an organization

Imagine organizational development as the process of running a marathon, or flying to the moon. 

Finishing the race or landing in the Mare Tranquillitatis might be the ultimate goal, but getting there involves a journey.

For example, maybe your startup or small business is growing, and you’d like to move from a flat to a more hierarchical organizational structure

According to Brenda Rigney, a Vancouver-based organizational development strategist and consultant, “OD activities can take months or even years; the timescales are much longer than other tactical HR activities.”

Achieving the organization’s purpose and/or objectives

According to Lorie Corcuera, co-founder of Vancouver-based SPARK Creations, “Organizational development starts with purpose, the vision for the organization, and the culture.”

OD assessments and interventions should be driven by the organization’s vision and objectives. 

If you’re a startup founder or small business owner, make sure your organization’s vision, or purpose, answers the fundamental question, "Why does your company exist?"

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Enabling and motivating people

At its heart, OD is a people-driven activity grounded in the field of behavioral science. 

Unfortunately, the importance of people is not reflected in most conventional definitions of OD. The people responsible for OD need to be enabled—supported, trained, and empowered—to make the changes necessary for OD. 

For OD to be truly successful, people must also be motivated. In his book, “Primed to Perform”, author Neel Doshi talks extensively about the importance of motivation in building high-performing organizational cultures that can adapt to change.

Manage, drive, and embrace change

Change management is at the very heart of organizational development. Scott Span, CEO and People Strategist at Tolero Solutions, defines change management as, “a structured approach to transitioning individuals, teams, and organizations from a current state to a desired future state.” 

The people being affected by the change process must also buy in and fully embrace them for OD to be truly successful.

Growing startups and early-stage companies must constantly adapt to new circumstances and challenges, so it’s critical for them to create a culture that thrives on change.

How Is Organizational Development Different From HR?

Organizational development is often confused with other business and organizational functions and activities, most notably with Human Resources (HR).

Organizational development and human resources are often connected, but they are not the same.

The field of Human Resources is focused on the strategies, processes, and policies related to the placement, management, and development of employees within an organization. 

HR’s main goals are to manage and support employees and to help management by assisting staff to do their best within the organizational structure, without systemic blocks hindering them.

Examples of some typical HR activities include:

  • Placement activities: recruitment, selection, and termination activities; diversity, equity and inclusion (DEI) programs; succession planning.
  • Management activities: performance management; compensation and benefits administration; legal employment standards compliance.
  • Development activities: training and education programs; workplace culture initiatives; performance coaching.

Many OD interventions will leverage typical HR activities to drive the necessary organizational changes. Examples of some typical OD interventions include:

  • Interpersonal interventions: vision and values creation; team-building and cohesion; cross-functional team dynamics; cross-cultural and international dynamics.
  • Structural interventions: organization structures (e.g. flat, matrix, team-based); lean and Six Sigma total quality management techniques.
  • Human resource interventions: performance management systems; compensation and rewards programs; leadership training; D&I initiatives; health and wellness programs.

To illustrate how organizational development is different from human resources, let’s look at a specific example. 

An HR manager might work with senior management to lead the creation of a performance management system that will be used by managers to review and develop their people. 

An OD practitioner or specialist, however, might look at how that same performance management system could be used to make the entire organization more effective, not just individual employees.

Difference between an human resources manager and organizational design practitioner. In summary, an organizational design practitioner takes a more holistic view than HR managers.

OD vs human resources development (HRD)

Organizational development is also sometimes confused with human resource development (HRD). 

Unlike OD, which focuses on moving the organization toward achieving its purpose and goals, HRD focuses on developing the skills, abilities, and knowledge of the individual employees within the organization. 

HRD activities are often required to enable OD activities. For example, perhaps your startup is in the process of moving from a flat to a more hierarchical structure (a typical OD activity).

If that’s so, training and education (a typical HRD activity) may be required for new managers to be effective.

How Do HR And OD Impact Each Other?

HR professionals and those with organizational development jobs know that organizations are becoming more complex and diverse, which makes employee management more complicated. 

The move to outsourcing, increasing globalization, cross-generational issues, and a greater focus on diversity and inclusion means that the old corporate structures may no longer be fully effective.

Traditional bureaucratic structures (e.g. hierarchical) are shifting to new team-based or matrix-style structures to meet the demands of a changing workplace.

HR (or whoever is responsible for HR in an organization) will often have a direct impact on OD as a result of the numerous HR interventions that can be used for organizational development. 

HR team members may also have OD expertise that allows them to make sure that OD best practices are incorporated when an organization decides to move forward with a change. 

Organizational development, on the other hand, will almost always have a direct impact on HR because every OD intervention requires change. 

Change can increase employee stress and anxiety, and cause confusion and uncertainty. Part of HR’s responsibility is to work with managers and leaders to ensure the health, well-being, motivation, and engagement of the company’s people.

HR needs to act as the department with a human face and work to alleviate people’s concerns around change.

Fears should be addressed by communicating properly with staff. HR can help redirect and clarify information that is causing angst, becoming the bridge between the staff and the team that is trying to implement OD. 

The effectiveness of clear communication that creates understanding is critical.

Who’s Responsible For Organizational Development?

It’s often believed that HR is responsible for OD because of the confusion between the two, and because in many cases OD activities rely on HR interventions. 

In truth, the nature of the intervention will typically determine who is responsible for driving it forward.

For example, the HR team may be responsible for an OD intervention involving a change to the company bonus program. 

On the other hand, the Quality Assurance team may be responsible for implementing Six Sigma techniques to assess manufacturing efficiency and improve quality control.

Broad organizational change requires the support and buy-in from everyone affected by that change to be successful. 

According to Corcuera, “Everyone is responsible for OD, but someone needs to lead it.”

Many larger organizations will have dedicated specialists, senior executives, or even entire teams focused on organizational development. 

However, most businesses rely on OD expertise from experienced senior leaders, HR team members with education in OD, or external consultants.

For smaller organizations, startups, and early-stage companies, OD activities are often the responsibility of the company founder, CEO, or owner.

Why Is Organizational Development Important?

By now you should have a better understanding of what organizational development is, how it’s defined, and how it relates to the typical HR activities in an organization. 

If so, then you’ve probably realized that in some way, shape, or form, you’ve already been practicing organizational development. For example, you’ve engaged in OD if you’ve ever:

  • Created a vision statement and values for your organization;
  • Created a compensation or bonus program;
  • Introduced a new performance management process;
  • Rolled out a new project management software system; or
  • Implemented lean or Six Sigma methodologies.

Depending on the size of your organization, you may not have an employee or team dedicated to HR. Instead, many of the typical HR activities will be performed by you, whether you’re the founder or owner of the business; the CEO; or a senior leader.

If that’s the case, you’re also probably busy with a myriad of other critical activities like raising money, hiring people, and creating your products and services. However, OD is at the heart of all of these things.

Every startup founder wants their organization to grow, and growth means change. By practicing organizational development with purpose and intention, starting from Day 1, you can ensure that the changes you make will be successful in the long run.

Organizational Development Process

To help you get organizational development right from Day 1, here’s how the process generally works.

Entry and contracting

This initial phase involves establishing a relationship between the OD practitioner and the organization (if using an external consultant).

This stage involves understanding the organization's needs, defining the scope of work, setting objectives, and agreeing on the terms and conditions of the OD intervention. This phase sets the foundation for trust and clarity in the OD process.

Data collection and diagnosis

In this phase, the OD practitioner collects data to understand the current state of the organization. This involves gathering information about the organization's processes, culture, and any issues or challenges it is facing. 

Methods such as surveys, interviews, focus groups, and observation are commonly used. The collected data is then analyzed to diagnose the underlying problems and identify areas for improvement.

Feedback and confrontation

The results of the diagnosis are shared with the organization's members in a feedback session. This step is critical as it confronts the organization with the data and insights gained, helping to create a shared understanding of the current state and the need for change.

Planning and goal-setting

Based on the feedback and insights gained, the next step involves collaborative planning to address the diagnosed issues. This includes setting specific, measurable, achievable, relevant, and time-bound (SMART) goals, and developing strategies and action plans to achieve these goals.


This is the action phase of the OD process, where the planned strategies and actions are implemented.

Interventions can vary widely, from structural changes and process improvements to training and development programs, team building, and cultural change initiatives.

The key is to choose interventions that are aligned with the organization's goals and are suitable for its unique context.

Evaluation and monitoring

The effectiveness of the interventions is continuously monitored and evaluated against the set goals. This involves collecting feedback, measuring outcomes, and assessing whether the interventions are having the desired impact.

Typical Organizational Development Interventions

Organizational Development interventions can be categorized based on the level they target within the organization: organizational, team, or individual. Here are some examples of how they can be split up:

Organizational-level interventions

  • Strategic planning: Developing long-term goals, strategies, vision, mission, and core values.
  • Organizational restructuring: Modifying the structure of the organization, including hierarchy and job roles.
  • Change management: Managing significant organizational changes like mergers, acquisitions, or shifts in business strategy.
  • Culture change: Efforts to shift the overall culture, values, and norms of the organization.
  • Diversity and inclusion programs: Initiatives to promote diversity and create an inclusive workplace.
  • Performance management systems: Implementing or revamping systems to manage and improve overall organizational performance.

Team-level interventions

  • Team building: Activities to improve team dynamics, communication, trust, and problem-solving.
  • Process consultation: Improving team processes and workflows for better efficiency and effectiveness.
  • Conflict resolution: Resolving interpersonal or intergroup conflicts within teams.
  • Project management and teamwork initiatives: Implementing methodologies and tools to enhance teamwork and project delivery.

Individual-level interventions

  • Training and development: Enhancing individual skills, knowledge, and capabilities through training programs.
  • Coaching and mentoring: One-on-one support for personal and professional development.
  • Career development programs: Initiatives focused on individual career progression and skill enhancement.
  • Employee engagement and satisfaction programs: Efforts to improve individual employee morale, engagement, and job satisfaction.

Organizational Development Skills

An organizational development practitioner requires a blend of specific skills and competencies to effectively analyze, design, and implement organizational structures and processes. 

These skills and competencies include:

  • Strategic thinking: Ability to understand and align organizational development with the overall strategy and goals of the business.
  • Analytical skills: Proficiency in analyzing complex organizational structures, processes, and data to identify areas for improvement.
  • Change management expertise: Understanding of how to manage and facilitate change within an organization, including dealing with resistance and ensuring stakeholder buy-in.
  • Communication skills: Strong ability to communicate clearly and persuasively, both in writing and verbally, to convey development concepts and changes to stakeholders at all levels of the organization.
  • Leadership and influencing skills: Capability to lead and drive organizational change initiatives, influencing stakeholders and decision-makers to gain support for development proposals.
  • Problem-solving skills: Aptitude for identifying problems within organizational structures and processes, and devising creative solutions to address them.
  • Project management abilities: Skills in managing projects, including planning, executing, and monitoring organizational development initiatives.
  • Knowledge of organizational behavior: Understanding of how organizations work, including the dynamics of group and individual behaviors within the workplace.
  • Interpersonal skills: Ability to work effectively with a variety of people, building strong relationships across different levels and departments within the organization.
  • Systems thinking: Viewing the organization as a complex system and understanding the interdependencies and interactions within it.
  • Attention to detail: Being meticulous in the development process to ensure all elements of the organization are aligned and integrated.
  • Consulting skills: For external practitioners, consulting skills are essential for effectively engaging with client organizations, understanding their needs, and providing tailored solutions.
  • Ethical judgment and professionalism: Upholding high standards of ethics and professionalism, particularly when dealing with sensitive information and making recommendations that affect employees.
  • Continuous learning: Staying updated with the latest trends and practices in organizational design and development is also crucial for success in this field.

Organizational Development Is Critical To Get You From A To B

Remember the analogies about the marathon and the moon mission? Taking an intentional approach to organizational development is vital to organizational success in the long term.

Some questions to ask yourself here:

  • In what areas do you think your organization could improve and how could organizational development thinking help?
  • What’s a recent organizational development activity (assessment or intervention) you have recently engaged in? How did it go? 
  • Does your organization have a vision (purpose) and set of objectives that guide your organizational development? 
  • Do you do it all yourself, or do you have someone or a team that helps you with your organizational development?

As you ponder these questions, it's a good idea to continue learning about organizational development and how you can apply it to your company. A good place to do that is organizational development conferences, where you can learn from colleagues who have pondered the same questions.

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By Mike Gibbons

Mike has extensive experience in sales, marketing, and product strategy; organizational and team development; and business growth and operations. He's held various senior leadership positions in the technology industry, and in 2016 participated as a lead member of the deal team responsible for the sale of Point Grey Research to FLIR Systems for USD$256M. Mike is guided by his deeply-held beliefs in connection, curiosity, humour, empathy, and honesty. Since leaving the corporate world in 2018, he's provide fractional executive and growth and strategic planning advisory services that have helped several early stage companies mature, grow responsibly, and live true to their values.