Organizational development is the practice of applying science-backed principles focused on strategy and alignment to the human-side of the organization in order to achieve business goals. In simpler words, organizational development works on developing the behavior of employees in order to meet an objective.

Is Organizational Development the Same as Human Resources?

Organizational development and human resources (HR) are not the same thing, but they are related. While HR does focus on enacting policies and procedures related to employees and structure, it tends to focus more on smaller scale operational improvements.

Organizational development, on the other hand, acts as a survey of the organization as a whole. With organizational development, it’s possible to look at multiple facets of structure and guide the practices of HR in order to make them more successful for the organization as a whole.

Where Did Organizational Development Come From?

According to People Managing People, organizational development theory has been around since the 1930s — providing nearly 100 years of research behind the practice.

Organization development was born out of research focused on the social sciences of employee performance and behavior, individually and in groups. That initial research also examined the ways that the structure of an organization can impact its long-term success.

How Does Organizational Development Work?

There are four categories of organizational development:

Human Process: How employees interact in teams and communicate as a group.

Techno-Structural Initiatives: Structure-level organization, including work methodologies (i.e. Agile) and restructures.

Human Resource Management: Typical HR initiatives including workplace culture, career development, diversity and inclusion, etc.

Strategic: Long-term initiatives that center on employee retention and leadership skill.s

The four categories of organizational development are typically carried out by consultants who perform a cyclical process involving identifying problem areas in an organization, gathering feedback and ideas, pitching solutions and then evaluating the results of the changes. 

Does Organizational Development Also Work for Small Companies?

It might sound like organizational development is for big corporations who are able to afford departments of people dedicated to putting organizational development plans into action. But, organizational development can benefit companies of any size. 

Small-to-midsize businesses, and even startups, are perfect candidates for organizational development. Organizational development can help teams work more efficiently, improve workplace culture and align all people in the company to a specific set of goals. 

For rapidly growing startups, People Managing People explains that it’s important to establish good organization development practices when the company size is still small so that it can more easily scale up. 

Implementing organizational development can be difficult for larger companies who have to dismantle inefficient and unorganized systems that have been in place for a long time. 

Small companies, especially startups, have an easier time implementing organizational development because they are starting from scratch and can grow into the new methods.

Can Your Company Benefit From Organizational Development?

Teams of all sizes — large and small — can benefit from organizational development. There’s no better way to gather all initiatives at your company under a clearly defined purpose and help motivate your team for success.

At Udacity, we believe that a key pillar of organizational development is continual learning. With our self-paced and flexible online tech courses, we’ve helped companies reach their true potential by educating their workforce.

For example, Udacity engaged with one of the big four professional services organizations and provided customized programs to help upskill their employees in cutting-edge technologies and prepare them for next-generation roles. 

Through this successful engagement, the professional services organization was able to increase its employee retention rate by ~5%. This resulted in over $2 million in savings — which otherwise would have been spent on external hiring, and a 19 point increase in employee satisfaction score. 

Organizational development is the right fit for any company that is ready to unite their workforce and find success. Our enterprise team can help business leaders identify online education programs that can fit into their organizational development strategy.

Contact us to learn more about our Enterprise offerings today. 

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