Organizational Development & Transformation
“Quietly but powerfully, projects have displaced operations as the economic engine of our times.” (Nieto-Rodriquez, 2021).
Organizations are in a constant state of change; every CxO exists in a persistent state of ‘more’ or ‘less’ (change): more revenue, less costs, more revenue (despite less customers) – the list goes on. Optimized technology implementations have been the accelerator and the difference between winners and losers. As artificial intelligence becomes more ubiquitous, organizational leaders will need to find different ways to create optimized change experiences for employees, customers, and products.
Executive Summary – Bottom Line up Front
Organizational development (OD) theory and practice can help executives and project managers to improve project success and change adoption – (because technology scales (good or bad) change; people empower change and the actual transformation by addressing issues affecting organizational performance. To effectively utilize OD theory and practices, here are the top three changes that executives and project managers need to start or stop doing:
- Prioritize Employee Engagement: Employees are the backbone of any organization, and their engagement is crucial to the success of any project. Executives and project managers need to start prioritizing employee engagement by creating a work environment that promotes trust, open communication, and collaboration. They should encourage employee feedback and involvement in decision-making to foster a sense of ownership and commitment to the project’s success.
- Stop Ignoring Organizational Culture: Organizational culture affects how employees behave, communicate, and interact with one another. These becomes the elements of delivery – trust, relationships, & collaboration that make-or-break teams. Executives and project managers need to stop ignoring organizational culture and recognize its impact on project success. You can do everything in the project management body of knowledge (PMBOK), or follow every element of the Agile manifesto, but if your culture is rotten, then what? They should evaluate the current culture, identify the strengths and weaknesses, and create a plan to develop a positive and supportive culture that aligns with the project’s goals.
- Anchor on Change Management: Change is inevitable in any digital transformation project, and the way change is managed significantly impacts its success. Executives and project managers need to embrace change management by identifying potential resistance to change, communicating the need for change, and developing a plan to address the resistance. They should involve all stakeholders in the change management process to ensure their buy-in and commitment to the project’s success.
Tools of the Trade
OD and project management are different tools. They’re not inherently good or bad. Their implementation, and application, however, need to be tuned and optimized for the organization, use case, and transformation journey.
“Organization Development is a long term effort, led and supported by top management, to improve organization’s vision, empowerment, learning, and problem solving processes, through an ongoing, collaborative management of organization’s culture with special emphasis on the culture of intact work teams and other team configurations-using the consultant facilitator role and the theory and technology of applied behavioural science including action research” (French & Bell, 1999). Stated simply, OD is about practitioners and leaders identifying challenges, and using themselves, and/or other techniques and mechanisms to optimize change within an organization.
Project management, by contrast, is the application of knowledge, skills, tools, and techniques to project activities to meet project requirements. It’s a recipe you follow to reduce project risks and to optimize success. Project managers are responsible for delivering projects on time, within budget, and with the desired quality. In recent years, there has been a growing recognition of the importance of organizational development in project management.
Change and transformation are best when OD and project management work together.
“In order to understand or change an organization, a [leader] or change agent must first examine the linkages between underlying values, organizational structures, and individual meaning.” (Denison & Spreitzer, 1991).
Project Management x OD
Here are some ways in which embracing OD theory and practices can impact (legacy / traditional) project management:
- Communication Management: Effective communication is essential for project success. Get away from checklists prescribed by the PMBOK. By embracing OD practices, organizations can improve communication within the project team and with stakeholders. This can help to avoid misunderstandings and ensure that everyone is on the same page.
- Human Resource Management: OD theory and practices can help project managers to identify and address human resource issues affecting project performance, such as conflicts, motivation, and team dynamics. By addressing these issues, project managers can create a more productive and engaged team. Becoming people-centric in everything starts with shifting the function and practices designed to engage your organization’s most valuable resource.
- Risk Management: OD practices can help project managers to identify and mitigate risks related to human behavior, such as resistance to change and poor communication. An open culture makes risk identification acceptable. By addressing these risks, project managers can reduce the likelihood of project failure.
- Quality Management: OD practices can help project managers to create a culture of continuous improvement, where quality is everyone’s responsibility. This can help to improve the overall quality of project deliverables. A culture of quality exists only where trust is high! Trust is an interpersonal dynamic!
- Integration Management: OD practices can help project managers to integrate different parts of the project, such as team members, stakeholders, and processes. This can help to ensure that the project is delivered as a cohesive whole.
Agile x OD
Organizational development theory and practice can also have a significant impact on the use of agile in digital transformation. Agile is a productivity methodology that emphasizes iterative and incremental development, collaboration, and flexibility. Here’s what organizational development and theory means for the use of agile in digital transformation:
- Emphasizing Continuous Improvement: OD theory and practices emphasize continuous improvement, which is also a core principle of agile. Executives and project leaders can use OD practices to create a culture of continuous improvement that aligns with agile principles.
- Fostering Collaboration and Communication: OD practices can help executives and project managers to improve collaboration and communication among team members. They can use OD practices to develop trust and open communication channels among team members, which can help to improve the flow of information and feedback.
- Addressing Human Behavior: OD practices can help executives and transformation leaders address human behavior issues that can impact agile’s success, such as resistance to change and poor communication. By addressing these issues, they can create a more supportive environment that aligns with agile principles.
There’s nothing wrong with using traditional project management or Agile practices.
Executives and project managers need to start embracing organizational development theory and practices to improve project success. The predictable effectiveness of any organizational transformation is dependent upon organizational development and change strategy (Biçer, 2022). They need to prioritize employee engagement, recognize the impact of organizational culture, and embrace change management. By doing so, they can create a more supportive environment that aligns with agile principles and improve the overall efficiency and success of their digital transformation projects.
Embracing organizational development theory and practices can have a significant impact on project management. By improving communication, human resource management, risk management, quality management, and integration management, project managers can improve the overall efficiency, productivity, and success of their projects.
“…leaders still don’t appreciate the value of projects…leaders don’t value project management because its methods are too complex to be easily applied. Many project managers end up producing reams of paperwork, too, which can create the impression that their role is primarily administrative…Projects give work meaning. Behavioral and social science show that projects can be particularly motivating and inspiring for team members. The moments they feel most proud of almost always happen on the projects they work on—the successful ones, of course, but often even those that fail. Leaders need to recognize that their role in the project economy involves more than just the direct sponsorship of individual initiatives.” (Nieto-Rodriquez, 2021)
Biçer, C. (2022). Challenging Sacred Cows that Inhibit Successful Organizational Change and Development. Paradigma: Journal of Economics & Management Research, 11(2), 67–78.
Denison, D.R. and Spreitzer, G.M. (1991). Organizational Culture and Organizational Development: A Competing Values Approach. Research in Organizational Change and Development. 5, 1-21. Retrieved from http://denisonconsulting.com/sites/default/files/documents/resources/denison-1991-competing-values-approach_0.pdf
French, W. L., & Bell, C. H. (1999). Organization development: Behavioural science interventions for organizational improvement. New Jersey: Prentice Hall.
Nieto-Rodriguez, A. (2021). The Project Economy Has Arrived. Harvard Business Review, 99(6), 38–45.