Businesses constantly face changes: market requirements evolve, competitors come and go, and new technologies emerge. Companies that adapt slowly to changes lose market position, while those who quickly restructure their processes for new challenges gain an advantage.
Let’s explore this new trend with an expert and discuss how organizational development helps businesses change and grow rapidly.
What is Organizational Development?
Organizational development is a systematic approach to managing change in a company. This direction is gaining popularity in companies, and advanced organizations are already creating specialized HR departments for these tasks.
The main goal of organizational development is to help companies quickly adapt to market changes and improve the quality of internal processes. While company leadership previously handled this, the increased pace of change and workload now requires a dedicated team of specialists.
Organizational development specialists work in four main areas:
| Company Structure | Model structure and choose the most optimal for business; restructure existing structure and adapt it to internal and external changes; coordinate structural change implementation |
| Company Goals | Help formulate company strategic goals and communicate them to employees; decompose global company goals into objectives for structural units and employees; build a system for coordinating goal execution from management to regular employees |
| Company Operations | Analyze and optimize management processes; configure internal communications; create job descriptions |
| Personnel Development | Train employees in new skills; build employee assessment system; help employees adapt to changes |
Organizational development can be reactive or proactive. In the reactive approach, a company changes only in response to external challenges — when competitors have already left the market or a new law has taken effect. The proactive approach involves constant trend analysis and preparation for possible changes in advance. Such companies create flexible processes, develop employee competencies, and test new work approaches before they become necessary.
“Work on organizational development never stops. The world changes quickly, and companies need to constantly adapt to new market conditions or internal business requirements. Even during calm periods, organizational development specialists work on optimizing management processes and helping employees work more productively”,
— Maria Pizhurina, SimpleOne HRMS Product Owner.
Connection Between Organizational Development and Personnel Management
The HR department serves as the primary partner in implementing organizational changes. HR specialists help communicate the meaning of changes to employees, recruit new people for new teams, or retrain current employees to work in modified processes. HR ensures that changes proceed as comfortably as possible for the team while remaining effective for business.
HR department’s key areas in organizational development include:
- Personnel Assessment: analyzing management productivity, auditing managerial skills, verifying task delegation capabilities.
- Team Building: forming new departments during structural changes, redistributing employees between units, finding specialists for new tasks.
- Change Adaptation: training for work in new structures, explaining new goals and objectives, providing informational and psychological support to employees during transformation.
- Results Evaluation: monitoring goal achievement, measuring team and employee KPIs, collecting feedback about changes.
The success of organizational development largely depends on how deeply it’s integrated into the company’s HR strategy. When organizational development and HR work together, all personnel processes improve: recruiters better understand which candidates will strengthen teams, the training system includes programs for developing relevant skills, employee assessment considers their contribution to company development, and the motivation system rewards useful initiatives. This integration helps HR specialists build personnel processes systematically and in accordance with company business goals.
Organizational Development Goals
The main goal of organizational development is to help companies quickly adapt to any changes. Businesses usually implement organizational development due to external circumstances or internal strategic decisions.
In the first case, companies react to external changes, such as entering new markets or opening branches in other cities. Sometimes work needs restructuring due to new laws or mergers with other companies. Competitors might also leave the market, giving companies an opportunity to take their place — requiring quick process changes for new tasks.
In the second case, companies decide to improve internal process maturity, for example, to speed up decision-making or enhance information exchange between departments. During growth, the need to increase task execution efficiency often arises, with management quality directly affecting company results, necessitating improvement of management processes.
Organizational Development Tools
You can’t manage what you can’t see, so the first step in organizational development is creating a clear company picture through organizational modeling. This tool helps visualize three key aspects: organizational structure, business processes, and goal systems.
Specialists model company structure to see all connections between departments and employees, create process models and job descriptions to understand how work is organized, and model goals to show how individual employee tasks connect to company global objectives. When all three aspects become visible, opportunities for analysis and improvement emerge. Before implementing any changes, teams can test them on the company model to assess risks and prepare employees for changes.
When the future change model is ready, the company moves to organizational design — practical implementation of the plan. While organizational modeling allows seeing and analyzing the situation, organizational design brings necessary changes to life.
Organizational design specialists change organizational structure, rebuild work processes, and implement new goal systems. They renew employee contracts, update job descriptions, configure new decision-making processes, and monitor achievement of set goals. Thanks to this comprehensive approach, company changes occur systematically and lead to desired results.
Organizational Development Methods
Beyond IT solutions, organizational development processes require interconnected methods for implementing changes. These methods help systematically progress through all stages of organizational development, from diagnosing the current situation to evaluating change implementation results:
Diagnostics: analyzing current organizational structure, evaluating management processes, auditing decision-making systems, verifying authority distribution. Diagnostics helps assess company state and find growth points.
Target Model Building: creating new organizational structure, describing modified processes, defining new roles and responsibilities, developing success indicators. Target models in organizational development represent the organization’s future state and provide a clear action plan for process transformation.
Change Management: preparing transition plans for the new model; informing employees, training in new processes, collecting and analyzing feedback. This involves comprehensive work supporting company changes to ensure transition to new processes remains comfortable for both employees and business.
Results Analysis: comparing indicators before and after changes, evaluating new process speed, measuring employee satisfaction, calculating economic effect. Tracking metrics and indicators helps determine change effectiveness and adjust action plans if necessary.
“In companies, organizational development methods are still forming, with many borrowing Western approaches and adapting them to their specifics. Each company creates its unique set of methods considering business specifics and goals”,
— Maria Pizhurina, SimpleOne HRMS Product Owner.
Organizational development often uses methods from various management areas. For example, Agile approaches help quickly test changes on small groups, gather feedback, and adjust plans. Design thinking tools enable deeper understanding of employee needs and create solutions considering their experience. It’s also important to work with change resistance — finding disagreement causes, involving change opponents in discussions, and helping them see new process advantages. For this, organizational development or HR specialists use group work facilitation techniques that help gather all participants’ opinions, find common ground, and develop shared solutions.
Evaluating Organizational Development Effectiveness
Organizational development results directly depend on the problem or task that initiated business changes. Specialists evaluate transformation success by various criteria, such as whether the original problem was solved: duplicate functions eliminated, company mergers completed successfully, plans consistently fulfilled, and other business challenges addressed.
However, it’s important to remember that organizational development is an ongoing process. After completing one project, work doesn’t stop; organizational development specialists can monitor indicators, collect feedback, adjust processes, and seek new growth points. Ultimately, the company receives not a one-time result but a continuously working improvement system.
Summary
Organizational development is becoming an important direction in companies — the approach helps businesses quickly adapt to market changes and improve internal processes. Unlike one-time changes, organizational development creates a continuously operating system of improvements.
The HR department plays a key role in organizational development, helping implement changes as comfortably as possible for employees while delivering real business benefits. Meanwhile, HR processes themselves become more systematic and closely aligned with company business goals.
