Diagnosing organizational effectiveness

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Diagnosing Organizational Diagnosing Organizational

EffectivenessEffectivenessA Roadmap toward Corporate SustainabilityA Roadmap toward Corporate Sustainability

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ContentsContents

1. Comprehensive Model for Diagnosing Organizational Systems

2. Organization-Level Diagnosis : Strategy, Structure, Culture,

People and Technology

3. Group-Level Diagnosis : Group Dynamics and Group

Performance

4. Individual-Level Diagnosis : Employee Satisfaction and

Performance

5. Designing Effective Organization Intervention

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Comprehensive Model for Comprehensive Model for

Diagnosing Organizational Systems Diagnosing Organizational Systems

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What is Diagnosis?What is Diagnosis?

• Diagnosis is the process of understanding how the

organization is currently functioning, and it provides

information necessary to design change interventions.

• It is also a collaborative process between organization

members and the OD (organization development)

consultant to collect pertinent information, analyze it, and

draw conclusions for action planning and intervention.

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High Politics Organization:High Politics Organization:

Common Approach to Business ProblemsCommon Approach to Business Problems

DOES THE THING WORK?

DON’T MESS WITH IT

DID YOU MESS WITH IT?

YOU DUMB*#@>!!

DOES ANYONEKNOW?

WILL YOUCATCH HELL?

HIDE IT

TRASH IT

YOU POOR$#@! ~*%$

CAN YOU BLAME SOMEONE ELSE?

NO PROBLEM

YES NO

YESNO

NO

YES YES

YESNO

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A. ORGANIZATIONAL LEVEL

B. GROUP LEVEL

C. INDIVIDUAL LEVEL

- General Environment- Industry Structure

Inputs Design Components

Organization Effectiveness

Outputs

Strategy

Structure Culture

Human Resources

Technology

- Organization Design


Team Effectivenesse.g., quality of work life, performance

OutputsGoal Clarity

Task Structure

Group Functioning

Group Composition

Group Norms

- Organization Design- Group Design- Personal Characteristics


Individual Effectivenesse.g., job satisfaction, personal development

Outputs

Skill Variety

Task Identity Autonomy

Task Significance

Feedback about Results

Comprehensive Model for Diagnosing OrganizationComprehensive Model for Diagnosing Organization

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Organizational-Level Organizational-Level

DiagnosisDiagnosis

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Organizational-Level DiagnosisOrganizational-Level Diagnosis

Culture

TechnologyHuman Resources

Systems

Structure

Strategy

Organization

Effectiveness

General

Environment

Industry

Structure

Inputs Design Components Outputs

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General EnvironmentGeneral Environment

General General

EnvironmentEnvironment

• The general environment represent the

external elements and forces that can

affect the attainment of organization

objectives.

• It can be described in terms of amount of

uncertainty present in social,

technological, economic, ecological, and

political forces.

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Five Forces of Industry StructureFive Forces of Industry Structure

Supplier Supplier PowerPower

Threats Threats of Entryof Entry

Buyer Buyer PowerPower

Threats of Threats of SubstitutesSubstitutes

Rivalry Rivalry among among

CompetitorsCompetitors

Industry Industry StructureStructure

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StrategyStrategy

StrategyStrategy • A strategy represent the way an

organization uses its resources to gain

and sustain a competitive advantage.

• It can be described by the organization’s

mission, goals and objectives, strategic

intent, and functional policies.

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Mission – Why We

Exist

Vision – What We

Want to Be

Values – What’s

Important to Us

Strategy : Our Game

Plan

Strategy Map : Translate the Strategy into

Action

Strategy FormulationStrategy Formulation

Analysis of General

Environment and Industry

Structure

Analysis of Organization’s

Core Competence

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Strategy : Our Game

Plan

Strategy Map :

Translate the Strategy

Strategic Outcomes

Satisfied Shareholders

Delighted Customers

Excellent Processes

Motivated Workforce

Strategy FormulationStrategy Formulation

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StructureStructure

StructureStructure • The structural system describes how

attention and resources are focused on

task accomplishment.

• It represents the basic organizing mode

chosen to (1) divide the overall work of

an organization into subunits that can

assign task to individuals and groups

and (2) coordinate these subunits for

completion of the overall work.

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CultureCulture

CultureCulture • Organization culture represents the

basic assumptions, values, and norms

shared by organization members.

• It orients employees to company goals

and suggests the kinds of behaviors

necessary for success.

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Elements of Corporate Culture FormationElements of Corporate Culture Formation

Top Management

View

Organization System and

Policy

Industry Characteristics

Organization Structure

Profile of Employees

Corporate CultureCorporate Culture

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Human Resources Systems Human Resources Systems

Human Human

Resources Resources

SystemsSystems

• Human resources systems include

mechanism for selecting, developing,

appraising and rewarding organization

members.

• HR systems influence the mix of skills,

personalities and behaviors of

organization members.

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Recruitment &Selection

Training & Development

Performance Management

Reward Management

Career Management

HR Systems

BusinessBusinessStrategyStrategy

BusinessBusinessResultResult

Human Resources Systems Human Resources Systems

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Technology Technology

TechnologyTechnology• Technology is concerned with the way

an organization converts inputs into

products and services.

• It represents the core of the

transformation function and includes

production methods, work flow and

equipment.

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• What is the company’s general environment?• What is the company’s industry structure?

• What is the company’s strategy?• What is the company’s culture?• What are the company’s structure, human

resources systems, and technology?

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Culture


Systems

Structure

Strategy

General

Environment

Industry

Structure

InputsInputs Design ComponentsDesign Components

Does the Does the

organization organization

strategic strategic

orientation fit orientation fit

with the with the

inputs?inputs?

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Culture


Systems

Structure

Strategy

Design ComponentsDesign Components

Do the design Do the design

components components

fit with each fit with each

other?other?

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Group-Level DiagnosisGroup-Level Diagnosis

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GroupFunctioning


Group Norms

Group Composition

Task Structure

Goal Clarity

Organization

Design

Team

Effectiveness

InputsInputs Design ComponentsDesign Components OutputsOutputs

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Organization DesignOrganization Design

Organization

Design

• Organization design is the major input to

group design.

• It consists of the design components

characterizing the larger organization

within which the group is embedded :

technology, structure, human resources

systems and organization culture.

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Group Functioning is the

underlying basis of group life

Group Norms are member

beliefs about how the group

should perform task

Group Composition

concerns the membership of

groups

Task Structure is

concerned with how the

group’s work is designed

Goal Clarity involves how well the group understand its

objectives

Group ComponentsGroup Components

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• Goal Clarity involves how well the group

understands its objectives.

• In general, goals should be moderately

challenging; there should be a method of

measuring, monitoring and feeding back

information about goal achievement.

• The goals should be clearly understood

by all members.

Goal ClarityGoal Clarity

Goal

Clarity

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• Task Structure is concerned with how

the group’s work is designed.

• Task structure can vary along two key

dimensions : coordination of members’

effort and regulation of their task

behavior.

Task StructureTask Structure

Task

Structure

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• Group Functioning is the underlying

basis of group life.

• How members relate to each other is

important in work groups because the

quality of relationship can affect task

performance.

Group FunctioningGroup Functioning

Group

Functioning

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• Group composition concerns the

membership of groups.

• Members can differ on a number of

dimensions having relevance to group

behavior.

• Demographic variables such as age

education, and job experience, can

affect how people behave and relate to

each other in groups.

Group CompositionGroup Composition

Group

Composition

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• Group Norms are member beliefs about

how the group should perform task

• Norms derive from interaction among

members and serve as guides to group

behavior.

Group NormsGroup Norms

Group

Norms

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• How clear are the group’s goals?

• What is the group’s task structure?

• What is the composition of the group?

• What are the group’s performance norm?

• What is the nature of team functioning in the

group?

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Individual-Level Individual-Level

DiagnosisDiagnosis

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Task Significance

FeedbackAutonomy

Task Identity

Skill Variety

Organization

Design

Group Design

Personal

Characteristics

(skill, knowledge

attitude)

Individual

Effectiveness

Individual-Level DiagnosisIndividual-Level Diagnosis

InputsInputs Design ComponentsDesign Components OutputsOutputs

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Organization Organization

DesignDesign

• Organization design is concerned with

the larger organization within which the

individual job is the smallest unit.

• Group design concerns the larger group

or department containing the individual

job.

• Like organization design, group design is

an essential part of the job context.

GroupGroup

DesignDesign


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Personal Personal

CharacteristicsCharacteristics

• Personal characteristics of individuals

occupying jobs include their age,

education, experience, and skills and

abilities.

• Personal characteristics can affect job

performance as well as how people react

to job designs.


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Individual Jobs DimensionsIndividual Jobs Dimensions

Five Key Five Key DimensionsDimensions

Autonomy

Feedback About ResultsTask Significance

Task Identity

Skill Variety

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Individual Jobs DimensionsIndividual Jobs Dimensions

Autonomy

The degree to which a job

provides freedom and discretion

in scheduling the work and

determining work methods.

Feedback About Results

The degree to which a job provides

employee with direct and clear

information about the effectiveness of

task performance

Task Significance

The degree to which a job has a

significant impact on other

people’s lives

Task Identity

The degree to which the job

requires completion of a

whole and identifiable piece

of work

Skill VarietyThe degree to which the job requires a variety of different

activities

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Job Characteristics Model - Hackman/OldhamJob Characteristics Model - Hackman/Oldham

Core Job Dimension

Skill Variety

Task Identity

Task Significance

Autonomy

Feedback

Psychological States

Personal and Work Outcomes

Experienced

meaningfulness of

the wok

Experienced

responsibility for

outcomes of the

work

Knowledge of the

actual results of

the work activities

• High internal work motivation

• High-quality work performance

• High satisfaction with the work

• Low turnover

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• What is the design of the larger organization within

which the individual jobs are embedded?

• What is the design of the group containing the

individual job?

• What are the personal characteristics of

jobholders?

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• How much skill variety is included in the jobs?

• How much task identity do the jobs contain?

• How much task significance is involved in the

jobs?

• How much autonomy is included in the jobs?

• How much feedback about results do the jobs

contain?

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Designing Effective Designing Effective

Intervention Intervention

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• A set of sequenced planned actions

or events intended to help an

organization increase its

effectiveness.

InterventionIntervention

Intervention

• Interventions purposely disrupt

status quo; they are deliberate

attempts to change an organization

or subunit toward a different and

more effective state.

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1. The extent to which it fits the needs

of the organization

2. The extent to which it transfer

change-management competence to

organization members

Effective InterventionEffective Intervention

Two Major

Criteria to

Define an

Effective

Intervention

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Intervention Success FactorsIntervention Success Factors

Key Factors

that can affect

intervention

success

Readiness for Change

Capability to Change

Capability of the Change

Agent

Cultural Context

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Types of InterventionTypes of Intervention

Human Process

Intervention

Types of Types of

InterventionIntervention

Structural

Intervention

Human Resource

Management Intervention

Strategic

Intervention

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Process Process

ConsultationConsultation

Examples of

Human Process Intervention

Team BuildingTeam Building

This intervention focuses on

interpersonal relations and social

dynamics occurring in work groups.

This intervention helps work groups

become more effective in

accomplishing task

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Structural DesignStructural Design

Examples of

Structural Intervention

DownsizingDownsizing

This change process concerns the

organization’s division of labor – how to

specialize task performances.

This intervention reduces costs and

bureaucracy by decreasing size of the

organization

ReengineeringReengineering This intervention radically redesign the

organization’s core work process to

create more responsive performance.

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Performance Performance

ManagementManagement

Examples of

Human Resources

Management Intervention

Career Planning & Career Planning &

DevelopmentDevelopment

This intervention is a systematic

process to link between corporate goal

settings and reward systems.

This intervention helps people choose

career paths and attain career

objectives.

Reward SystemReward System This intervention involves the design of

organizational rewards to improve

employee satisfaction and performance.

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Merger and Merger and

AcquisitionAcquisition

Examples of

Strategic Intervention

Cultural ChangeCultural Change

This intervention is a systematic

process to integrate two or more

organizations.

This intervention helps organizations

develop cultures appropriate to their

strategies and environment.

Organizational Organizational

LearningLearning

This intervention seeks to enhance an

organization’s capability to acquire and

deploy new knowledge.

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Institutionalizing Interventions Institutionalizing Interventions

Effective Institutionalization

Process

Intervention

Enhance Organization Performance

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Factors Affecting Institutionalization ProcessFactors Affecting Institutionalization Process

Organization

Characteristics:• Congruence• Stability • Unionization

Intervention

Characteristics:• Goal Specifity• Programmability• Level of Change Target• Internal Support• Sponsorship

Institutionalization Process

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Organization

Characteristics:

CongruenceThis is the degree to which an intervention is

perceived as being in harmony with the

organization’s strategy, and structure; its

current environment; and other changes

taking place.

Stability of Environment and

Technology

This involves the degree to which the

organization’s environment and technology

are changing.

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Organization

Characteristics:

UnionizationDiffusion of interventions may be more

difficult in unionized settings, especially if the

changes affect unions contract issues, such

as salary and fringe benefit, job design, and

employee flexibility.

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Intervention

Characteristics:

Goal SpecifityThis involves the extent to which intervention

goals are specific rather than broad.

ProgrammabilityThis involves the degree to which the

changes can be programmed or the extent to

which the different intervention characteristics

can be specified early in advance to enable

socialization, commitment, and reward

allocation.

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Intervention

Characteristics:

Level of Change Target

This concerns the extent to which the change

target is the total organization, rather than a

department or small work group.

Internal Support

This refers to the degree to which there is an

internal support system to guide the change

process.

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Intervention

Characteristics:

SponsorshipThis concerns the presence of a powerful

sponsor who can initiate, allocate, and

legitimize resources for the intervention.

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Recommended Further ReadingsRecommended Further Readings

1. Thomas Cummings and Christopher Worler, Organization Development

and Change, South Western College Publishing

2. Stephen Robbins, Organizational Behavior, Prentice Hall

3. Marvin Ross Weisbor, Organizational Diagnosis : A Workbook of Theory

and Practice, Perseus Books Group

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Diagnosing organizational effectiveness