Date: 03/07/18 | Duration: 18:27
The practice of organisational design and development is changing and its profile is growing in the world of work and HR. Organisations are looking to OD experts - and sometimes HR professionals with only limited OD expertise - to help them resolve the many and varied challenges they face. But there's confusion about what OD is and some questionable truths about OD often go unchallenged. Together those issues can create significant organisational risk.
In this episode, we talk to OD experts Dr Naomi Stanford, Sadie Sharp, Gary Cookson and Warren Howlett about how OD is changing, what it can do and the role that HR can play.
View the full podcast transcript
Gary Cookson: Say you met me at a party and said, “What do you do Gary?” and I said, “I work in OD,” you’d say, “What the hell’s that?” and you’d be right, and how do you explain it? I'm not sure you can.
Philippa Lamb: Could you explain what OD is?
GC: You could say that my role is to help organisations change and organisations improve, but then the follow-up question would be and how do you do that? And there's no way in a couple of minutes that I’d be able to keep your attention and avoid you going off to talk to somebody else at that party.
PL: That's Gary Cookson he's in HR with years of organisational design and development experience and he's right there's a lot of confusion about OD, what it is, what it does. In the early days it was mostly academic territory. There was really very little out there in the way of understandable text or tools that practitioners could use. Now though that is all changing and OD is evolving fast, driven by all the other changes affecting work and the workplace. Here’s Warren Howlett he’s the CIPD’s head of content.
Warren Howlett: OD some people might say is driven by the massive shifts that we’ve seen in the workplace. We’ve seen it in automation of production; we’ve seen it in the services sector, now in the white collar workplace. We’re seeing automation and a cognitive process automation of white collar jobs and we’re potentially starting to move into the exponential part of the change curve and it’s no wonder that organisations rate building the organisation of the future as their top priority in recent business surveys.
PL: So that's driving interest in this as a field whilst in the past it’s been a very academic discipline now as you say it’s coming much more onto the ground in organisations of all sorts.
WH: It definitely has changed. I think one of the most interesting things that has evolved in organisation design and development is a greater availability of good information, good guidance, good resources and tools for organisation design and development. So there's an opportunity for people who are not necessarily specialists to get involved in organisation design and development.
PL: And educate themselves.
PL: Warren is very focused on all this right now because the CIPD thinks that OD is even more important now than it’s ever been. But do organisations themselves actually know that and how much do they understand about how to use OD. Sadie Sharp is a business transformation consultant. Her work is all about helping organisations redesign how they operate. Now like Gary she has a lot of on the ground experience with a very wide range of corporate and public sector clients. I
asked both of them how OD works. So as an OD consultant how does the process usually work?
Sadie Sharp: Obviously the best level to be brought in at is when they are trying to say we want to change direction, we know we need to change but we’re not quite sure how to do that.
PL: And the worst?
SS: The worst is, we’ve done this come on in and help us make it work, which is kind of putting the plaster over it really.
GC: I'm Gary Cookson and I'm the director of Epic HR.
PL: So when organisations come to you what sort of tasks do they tend to ask you to organise for them?
GC: Well when I was in house as an HR and OD practitioner it tended to be larger scale OD projects. So I worked for 12 years at a housing association. I was head of HR there and some of the large scale OD projects that I dealt with in that time would have been organisational restructures, business process reengineering work, a move of head office location and consolidation of a lot of different offices into one, culture change and embedding new values and merger of two organisations and a wholesale change to terms and conditions. So that's just a flavour of some of the things.
PL: So what sort of tasks do organisations have in mind when they call you in specifically?
SS: Usually it’s triggered by your typical areas of pain such as having to shave a significant amount of money off their operating budgets, or there's been quite a lot of transformation in the sector in terms of competitors, a significant shift in operating technology platforms, those sorts of things. So they’re normally brought upon them by a change in external circumstances or finances.
GC: So sometimes you’re lucky enough to have a burning platform and if you have then that galvanises the organisation to some degree and enables everybody to get behind the particular change that you’re trying to drive and bring into the organisation. But where you haven’t got that…
PL: You've got a cold start.
GC: Yeah where you've got a cold start and you’re doing something because you think it’s a good or the right thing to do that becomes quite difficult to try and build enough momentum and get that guiding coalition together to try and establish a real foothold for change.`
SS: Yeah so normally what I will do when I'm particularly managing a large organisation design project is spend the first probably four to six weeks doing nothing other than just getting to know the business.
PL: And how do you do that?
SS: So I literally immerse myself in the business.
SS: Physically immerse myself in the business. So I've done some work with tarmacking firms where I've actually gone out on the front line and learnt how to tarmac the roads and operate the machinery.
PL: That's a useful skill.
SS: Absolutely it did me wonders on my driveway.
PL: At what stage do you get to the point where you start designing a strategy, a way forward?
SS: So I wouldn’t even start designing until I have tried to spend quite as much time as possible with mid-level managers because the challenge is if you start designing and you come in with those preconceptions in your head around this is what the organisation needs it shows, on one level or another and the mid-level managers say, “Well you've made your mind up already what’s the point anyway, you’re going to do it to me!”
PL: So they feed into the process.
SS: They do absolutely.
PL: You draft up ideas.
SS: So you draft up so a lot of the approach I tend to take with large organisations is collaborative working groups, quantitative surveys, telephone interviews, those sorts of things, as well as actually sitting alongside and doing a week in the life of senior managers, for example. But the reason why I do that is if the high level boardroom in the business and the chief execs and the management team are saying, “This is the state of our business; these are the problems we have; this is how ready our people are for this kind of a change; it’s really being able to shine a true mirror up to those perceptions because sometimes they're on point and other times actually there is a massive chasm between the boardroom’s view of that and the front line realistic, pragmatic, view of that, shall we say.
PL: And how about measuring success, measuring outcomes?
GC: It depends what you’re trying to achieve. I've cited five or six different projects that I've been involved in but they'd all have different success criteria so I don't think there are common success criteria because it’s highly specific and contextual.
PL: But in terms of expectations, management expectations of what a successful OD process looks like what do they tend to ask you for?
GC: They tend to ask for metrics that you can measure before and after and they will tend to be things like engagement rates, they might be things like attrition rates, absence rates, so some of the more traditional HR indicators. But then it’s okay to get those and you will have those bits of data and as an HR director it’s fine to have those but that's not enough to measure the success of the OD initiative, so you need to look at other things too and have like a balanced scorecard approach.
PL: What sort of things?
GC: Financial measures, productivity measures, performance measures, as well as the HR measures.
PL: Skipping lightly over the very difficult part of implementation because obviously that's going to vary from organisation to organisation, what do your clients expect from you in terms of outcomes, because obviously one of the sacred cows of OD is that 70% of the interventions actually do nothing or indeed can create harmful outcomes, what do they expect from you though?
SS: I think the biggest thing that a lot of organisations will expect from OD these days is to see a marked change in the way that the organisation feels as well as looks.
PL: And how do you measure that?
SS: Exactly and again I know measuring the effectiveness of OD interventions is always a hot topic and I guess the challenge here is sometimes trying to manage their expectations, saying, “You came to me saying that your organisation isn’t as effective as it needs to be because it feels like it’s broken, because it feels like there's conflict, it feels like the culture is wrong and you've got anecdotal stories that will support that so it’s not completely in the air but you have almost feelings and perceptions-based evidence that brought you to me so therefore don’t discard that feelings and perceptions-based information after the OD.”
PL: Do clients have expectations of measurable financial outcomes
SS: Yes most of the time, as I say, because it is often triggered by the need to reduce operational cost, rightly or wrongly that is often the expectation.
PL: And is OD in a position to say, yes we can do that?
SS: I think OD is certainly in a position to say, I can help you achieve that but actually whether or not these things bed in, whether or not the processes succeed, all of those sorts of things, it requires ongoing management. So I think this is the other thing with a lot of OD from an external consultancy perspective it’s really important that when you’re going in to do that with your client you do it with them because what you don’t want is obviously the second that you leave that it’s like, well it’s done now we can just go back to business as usual. So rather than having to do the old change approach of unfreeze, change and then refreeze and we’ll be safe for the next five or six years, everything is moving away too quick to be able to do that they need to learn to embrace change as the constant.
PL: Early in her career Dr Naomi Stanford worked for big multinationals like Price Waterhouse, BA, Marks and Spencer and Xerox, now she's recognised internationally as a leading OD thinker, practitioner and author. Now when we met I asked her about tech which is now playing an increasingly interesting role in the field.
Naomi Stanford: So for example if you have good organisational data on people’s capabilities, their pay scales, who they report to, you can then start feeding that data into manipulable form so that if you say we want to downsize 10% in Coventry and relocate people to somewhere else what would that look like in terms of spend, in terms of people’s reporting lines, in terms of the capabilities that we would need to develop? And it really speeds up the process and allows you to model different
scenarios so you can say, we want to downsize in Coventry, but you might say, but maybe we could also downsize in Bristol and then you can compare the two.
PL: As you say the outcomes you get from that depend on the quality of the data you feed into it,
NS: Correct that’s right yes.
PL: But I mean I must say I was surprised that hadn’t been going on already because it seemed like a common sense use of technology but you also told me about something which I hadn’t thought of which was the idea that you could model specifics around individual people and their networks. Tell me a bit about that.
NS: That's right. So there is a lot of work going on on social network mapping and organisational network mapping. Now you can map, and the technology is sophisticated on this, by tracking voicemail, email, text messaging and what have you from one organisational individual to another, so you can build up very complex networks of individuals who they’re interacting with. And there is some method, I don't quite know how they do it, to filter out the football conversations and just make the work conversations.
PL: So this rests on the idea that if you move Helen from job role A to job role B she’ll lose the network she currently uses in job role A because it won't necessarily be relevant so she won't be as effective, and then what, it then moves to what can the organisation do to assist her to build a new network?
NS: Yes well there are a couple of things if you’re looking at specific individuals which inevitably it boils down to at some point in a design, although I do try and emphasise roles not people, if you start to say, well would Helen be better than George in this post? Then you can start to look at the networks and then you can start to say, well if she's been here x number of years and has built up that extensive network in the organisation and to contacts outside is it going to be useful in the role we’re thinking of putting her in? Has she got the skills and capabilities to develop another network as quickly? As soon as you disrupt someone's network you've disrupted their ability to act in the role. You can't automatically assume that because someone is good in one job they’re going to be good in even a similar job because that doesn’t take into account the network they have to have to do the job.
PL: I think this is really interesting, the question it immediately flags in my head though is ethics, because this draws on very personal data doesn’t it, and the willingness to give it.
NS: That's right. You can actually do some of the work just by wandering round, seeing who’s talking to people or seeing what’s going on.
NS: Yes that's right.
PL: And right now as the CIPD develops its professional standards framework for the HR community OD is set to play a very significant role in that roadmap. Here’s Warren again
WH: As the CIPD we’re the professional body for all of the people profession, and not just HR, so OD and D’s increasingly important for us as an organisation, it’s one of our most popular areas for information resources. I think what’s also really interesting is that we’re starting to see perhaps broader interest in organisation design and development than we’ve had in the past.
PL: I think what we’re still finding is that there is a huge amount of confusion about what OD and D actually is and where it lives in terms of responsibility for driving it, what are your thoughts on that?
WH: I think as we think about people professionals more broadly, let’s take HR generalists for example, HR generalists are very often the gatekeepers of data around people within their individual business unit and also connecting that to the organisation. They often have a really good knowledge around the system within their business unit from a people perspective and then how that connects with other systems within the organisation. So if you’re an organisational design specialist you might be coming into the organisation or already be in the organisation and have the knowledge skills and behaviours of that profession but it’s actually within parts of the HR function that there are individuals who can best enable and support that organisation design professional in doing their job. So there's an important synergy I think between the two that often gets perhaps misunderstood and it’s not a competition between one or the other, they need to work together.
PL: And obviously in the real world, in smaller organisations particularly and in straitened financial times for everyone often there is no OD specialist in the room is there, it’s HR who are expected to meet those objectives?
WH: I think that is a harsh reality and it may be the HR person that's having to get involved in those types of activities.
PL: So a real area of focus for HR in terms of developing themselves?
WH: Absolutely and that's reflected in how we’re thinking about our new professional standards framework.
WH: So this is a big change for us, we are building the professional standards framework for the future of the profession. It’s been a couple of years of work in the making and what we’ve identified is that organisation design and development needs to be a greater area of focus for us moving forward. So it will be its own specialism area within the professional standards framework on its own.
PL: Yeah that's interesting. So much more emphasis on OD and D and when is that coming to pass?
WH: So we are drafting the standards at this point in time, working with experts in the relevant fields and pressure-testing them with a small audience. We’ll be going out to a broader audience across the summer and then looking to launch towards the end of the calendar year.
PL: So in terms of the new professional standards framework obviously it’s work in progress right now but what can we expect in broad terms?
WH: So within the context of the professional standards framework organisation design and development will have an area of specialism that's similar to how we focus on HR and L&D today so it’s a big shift for us as the CIPD and as the CIPD we will need to support and enable organisation design and development professionals so we’ve got a whole schedule of work around additional information resources, events, training and development that we are scheduled to build over the next 12 to 18 months.
PL: So that's very good news isn’t it for all those people listening to this who are sitting in organisations thinking, I don’t have budget necessarily for an OD external practitioner to come in and help me do this but if they do from what you’re saying it’s going to equip them to work better with that person.
WH: Absolutely. What we’re not looking to do in organisation design and development as the CIPD is to in any way replace or displace what organisation design and development specialists do in their roles and what we would like to do is to raise awareness more broadly across the people profession of some aspects of organisation design and development so people professionals can better enable and support better decisions about organisation design and development.
PL: The OD residential summer school is running in London this month and it’s in Edinburgh in September. Warren will be hosting an OD conference in October so if this does sound like something you need to know more about book your place and check out the fact sheets on OD and D on the website in the meantime.
If you’d like an OD qualification to shine up your resume, the CIPD offers short courses like the Advanced Award in OD and D. Now handily you can do that one in modules throughout the year or fast track it in five consecutive days.
Thanks to Warren and this month’s other guests: Sadie Sharp, Gary Cookson and Dr Naomi Stanford.
Thanks for listening.