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What Is Organisational Development and Why Is It Important

The market is a highly competitive and a volatile place as customer needs and preferences keep changing without any warning.  A start-up or an organisation needs to be flexible with the ever-changing demands and needs in order to adapt to sudden changes.  Many high performing start-ups had to close shop because they simply could not account and plan for the future.  Nokia had to shut shop because it could not adapt to the iOS and Android operating systems, Blockbuster closed down because Netflix disrupted their entire business model and there are many more such examples.  However, some companies survived due to multiple changes in technology like Philips for instance, which realised the importance of LED and incandescent bulbs.  Philips quickly adapted these new bulbs into their roster because they understood Tungsten filament bulbs would be phased out.  

This is where Organisational Development (OD) comes into play and almost every start-up which continuously adapted to change applied principles of organisational development.

What is organisational development?

In simple terms organisational development means doing something which ensures the longevity of an organisation.  OD ensures people and processes can adapt to change, innovate and be in a state of constant transformation.  OD can only be successful if it is part of a company’s core goal.  

 

Why is OD important?

OD does not mean just developing skilled staff and efficient systems and the following are the reasons why OD is important.

1) Boosting emotional intelligence

Emotional intelligence is the ability to understand, use, and manage your own emotions in positive ways to relieve stress, communicate effectively and empathize with others.  Emotionally intelligent companies develop strategies in place to help their employees hone their skills and become more productive.  A simple example would be to assign a new employee to shadow an experienced member of the team so they could learn the ins and outs of the team processes.  Similarly, external mentors could be brought in to offer sessions on topics relevant to a team.

2) Attracting and retaining talent

Gone are the days when jobs used to be monotonous and devoid of much learning.  The current workforce is highly focussed and needs to learn new skills and data quickly.  The workforce has come to expect a certain kind of professional development from their employers.  Having an environment of continuous learning would encourage current talent to stick to an organization and at the same time provides a huge incentive to attract new and great talent.  Some of the top organizations like Salesforce, Indeed, Google and Microsoft to name a few are always in demand among job seekers and their workforce constantly keep talking about the developmental opportunities provided.

3) Product and service enhancement

One of the key importance of OD is it drastically improves the chances of innovation which leads to product enhancements.  Innovation is achieved through employee development, which focuses on rewarding successes and boosting motivation and morale.  Processes like Technology development, patents, manufacturing capabilities, consumer preferences, target market analysis are some of OD topics which assist in innovation.  An example would be OnePlus which is deemed as a flagship killer in the mobile segment because they understand the market need for having a premium phone with flagship features for an unbeatable price.  Year after year, they have exceeded expectations in terms of pricing and features because OnePlus understands the needs of their target market.

OD programs in an organization can greatly contribute to amplify a company’s ability to manage and maximise the power of change.  Gone were the days when a job was an exchange of time and energy for financial gain.  Today employees want a place of learning and a place where ideas are discussed freely and having an OD plan will greatly contribute to the success of an organization.

*This article was covered by Top Business Tycoon