Organizational

Development
Organizational Diagnosis
Week 3
Organizational Diagnosis

1.Methods and tools for assessing organizational

effectiveness
2.Identification of organizational problems and
challenges
3.Data collection and analysis techniques
I. Organizational Effectiveness
• How far an organization’s current ability to meet its own goals.
• Organizational effectiveness is often defined financially through
profits, efficiency, or growth.
• Effectiveness can also be about staff retention, job experience,
community impact, or market share.
• Measuring Organizational Performance is a vital part of any business.
But every leader must define organizational effectiveness for their own
company.
Importance of Organizational
Effectiveness
• Creating a successful organization means achieving organizational
effectiveness. Improving your company’s ability to reach its goals is
critical to delivering shareholder value. It means your business will
thrive long term.
• Maintaining a competitive advantage means regularly assessing
organizational effectiveness and isn’t something you achieve and
forget about.
• Companies must continually question the efficiency of their
operations, employee performance, and leadership styles.
• When facing disruptions, organizational efficiency can make all the
difference. Your company can face challenges head-on and prioritize
continuous growth.
• By committing to organizational effectiveness, your company will
build resilience. This process involves all company areas, from senior
leaders to staff.
Five ways to maximize Organizational
Effectiveness
• To gain a competitive advantage, you must approach organizational
effectiveness holistically.
• Encouraging enterprise-wide collaboration is complex. Employees,
leadership, processes, and culture must work in tandem.
• Think of each of these areas as pillars supporting a large structure.
Any weak areas threaten the stability of the entire organization.
1) Prioritize People, Processes, and Resources
• Are employees motivated and productive? Or do they consistently fail
to engage in tasks?
• Performance depends on several factors like the quality of employee
training, the work environment, tools, and effective management.
• Employees and leaders are ineffective without efficient processes.
Operations should be fast, lean, and cost-effective.
• Staff also rely on operational efficiency to do their work. Employees,
management, and processes must align to be effective.
• Gartner’s research shows that when ‘employee goals are aligned to
both organizational and employee needs, employee performance
increases by up to 22%.’
2) Align Strategy and Objectives
• Many organizations undergo large-scale transformations to achieve
organizational effectiveness.
• But many organizations don’t improve at the desired rate because they
fail to align strategy with objectives.
• Once you understand your organization’s value chain, you can adjust it
to align with your objectives. Different approaches to reorganization
depend on specific business models, but the key is being open to
change.
• For example, could you provide a better customer experience through
automation? Tech-savvy customers often prefer online automation as
the chosen method of interaction with a company.
• A change like this would involve an implementation strategy, change
management expertise, and executive buy-in.
• Balancing all these moving parts can be complex, and businesses often
neglect to address their company objectives throughout the process.
• Aligning strategy and goals helps your organization to make necessary
changes to organizational structure.
3) Align Company Structure with Strategy
• After prioritizing objectives, you can start aligning company structure
with strategy. Organizational structure dramatically impacts an
organization’s performance.
• For example, is the organization a top-down, autocratic hierarchy? Or
is it democratic, composed of autonomous teams and individuals?
• Finding the best structure and design for your model is crucial to
becoming an effective organization.
• The system of leadership, management, culture, and other factors
contribute to how well functions work together.
• For example, if employees don’t engage with new work systems, then
processes become stalled.
• Your organization needs an effective structure model to
simultaneously engage all levels of the business.
• A holistic approach is the best way to ensure organizational
inefficiencies don’t slow down the company.
4) Measure Results
• How do you know if your efforts are paying off? Assessing
organizational effectiveness isn’t as simple as looking at profits.
• Data analysis can be an important way to determine efficiency, but it’s
equally important to focus on the human side of organizational
growth.
• Maintaining transparency is the best way to engage employees in your
efforts to achieve organizational effectiveness.
• Set out the roles and responsibilities of everyone involved and share
the progress of your strategy at regular intervals, which will motivate
everyone to keep pushing forward.
5) Continuously Improve
• Organizational effectiveness is a continuous process. If you want your
organization to commit to the process, you need support from the top.
• Executive support has a trickle-down effect throughout an enterprise,
encouraging everyone to get on board with change initiatives and
transformations.
• A clear and consistent commitment from leaders is the best way to
ensure your organization continues to improve.
• Remember to evaluate progress regularly and always look for areas of
improvement.
Organizational Effectiveness Models and
Approaches
• The Canadian Center of Science and Education reviewed four separate
models of organizational effectiveness.
This study, which focused on organizational effectiveness within higher
education, included:
The Goal Approach – Defining effectiveness based on organizational
objectives such as profit, innovation, and profit quality.
The System Resource Approach – This model explains effectiveness
based on an organization’s ability to obtain necessary resources.
The Process Approach – This approach focuses on the efficiency and
effectiveness of the processes within an organization.
The Strategic Constituency Approach – This model defines
effectiveness based on the stakeholders’ interests.
Production, Commitment, Leadership, and
Interpersonal Relationships
• Dr. P. Venkataiah at Osmania University created this model that
focuses on crucial components in an organization, such as:
Production. The flow of organizational output.
Commitment. How attached workers were to the organization.
Leadership. Personal ability and influence.
Interpersonal conflict. Perceived misunderstandings between
supervisors and subordinates.
• The underlying theme is evident. Efficiency, harmony, and
effectiveness in various areas contribute to organizational
effectiveness.
• More effective organizations are more profitable, resilient, and
competitive.
II. Organizational Problems and Challenges
1. Absence of clear direction.
Lack of direction is one of the most common problems in an
organization and it stems from two root causes:
• The leader or leaders rarely discuss or chart a deliberate direction or
strategy for the future, or they fail to communicate a coherent message
about the strategy to all members of the organization.
• There are many activities to execute, and the organization lacks the
alignment needed to gain the traction necessary to help the
organization transform, adapt, and shape the future—activities that
would ensure the organization’s long-term, sustained growth.
• Many functions and individuals lack an understanding of how they fit
or why they matter.
• As a result, people become complacent, content to just show up, take
care of today’s business, and hope that someone is in the wheelhouse
steering the ship.
2. Difficulty blending multiple personalities into a cohesive and
unified team.
• This can be an enormous challenge, regardless of whether the team is
part of the executive suite, a special project team in an R&D lab, or an
operating team in a production facility.
• People’s personalities vary widely, and the diversity of backgrounds,
opinions, views, and experiences can cause challenges for teams. This
creates a unique set of potential issues and opportunities.
• If you can get people to come into alignment and support common
objectives, a diverse team of leaders can produce amazing results, take
on the demands of customers, and meet the threat of competitors.
• Leaders stay in their silos, protect their own “turf,” fail to share
information, refuse to collaborate on shared problems, or lack the
ability to think with an entrepreneurial mindset, the organization will
under-produce.
3. Failure to develop key competencies and behaviors.
• In our work with organizations, we commonly encounter a lot of
hardworking people who have good intentions.
• Their experience in the industry, their technical talent, and the subject-
matter expertise that many leaders bring to the table, creating a high-
performance organization is often still out of reach.
• Nearly everyone we meet, including senior leaders, has at least one
(and in some cases, multiple) leadership weaknesses.
• Sometimes leaders are aware of their behavioral shortcomings; in
other cases, they are blind to their leadership deficits.
• People inside the organization are often afraid to candidly say what
they think, and helping enormously successful leaders with their
Achilles heels can be tricky.
• Leading and managing an organization is a complex task that requires a
unique mix of skills. Leaders have to utilize their natural strengths, but
they also have to search relentlessly for ways to close their own
performance gaps and improve their behavior.
• Without continuous improvement, an organization’s capabilities will be
severely limited. Leaders don’t constantly raise their game, they will
suck all the energy and employee engagement out of an organization.
• Leaders need to be constantly aware of and working on their personal
opportunities for improvement.
4. Poor communication and feedback.
• There seem to be two extremes with this common problem in an
organization: Either people do everything in their power to avoid
confronting others and holding them accountable or they relish any
opportunity to chew people out, belittle them, and crush their spirits.
• Countless leadership teams in which the number-one problem was a
lack of honest, constructive, and open dialogue about the team
members’ practices, styles, skills, or behaviors. Without a culture of
openness, feedback, and coaching, organizations will struggle to grow.
• People often tell us that they fear reprisal or retaliation if they open up
—but the reality is that leaders can’t execute on their strategies, lower
costs, or effectively launch new processes or services when people fail
to communicate with constructive candor, so this is an issue that must
be overcome.
5. Lack of awareness.
• Building a solid organization takes hard work and a keen awareness of
the culture and environment that exists in a business. Most executives
are very busy people; a lot of things view for their attention.
• Market conditions can change fast in a VUCA (velocity, uncertainty,
complexity, and ambiguity) world and demand huge portions of a
leader’s time. We affectionately call this the “task magnet.”
Preventing Organizational Challenges
1. Recruit effective leaders
• Leadership can have a direct influence on the work environment and
the productivity of employees. As you hire professionals for
managerial positions, consider their qualities and how staff members
may react to their communication style.
• For example, a trustworthy leader may compel employees to feel
comfortable addressing their thoughts and following the leader's
direction.
• Aside from a potential manager's technical skills, assess their soft
skills, which might indicate if they're a suitable fit for your
organization. Evaluate their ability to solve interpersonal conflict and
empathize with members of their team.
• Having a more extensive vetting process can help you promote a
qualified employee, creating a work setting that retains employees.
2. Hire a consultant
• If your organization is experiencing several challenges, then it may be
helpful to hire a consultant.
• Consultants are professionals who can objectively identify the root
causes of your organizational problems and help you devise solutions.
They often have expertise within your industry.
• For example, if you work at a hospital, then you can hire a consultant
who specializes in improving operations in medical facilities.
• Consultants can help you overhaul the inner functions of your
organization and build stronger functions, preventing challenges from
reappearing.
3. Request feedback from employees
• Another way to identify and prevent organizational problems is to
request firsthand knowledge from employees. Ask them how they
enjoy working at the company.
• Ask specific questions about the work environment and leadership
style, as well as how productive they feel completing their tasks. Next,
analyze their responses to strategize how to address the challenges.
• For example, if employees reported feeling disconnected from a
manager, then you might schedule a meeting with the manager to
suggest ways to improve their leadership techniques.
• Consider requesting feedback consistently to ensure employees feel
satisfied with the organization.
III. Data Collection and Analysis
Technique
• Data Analysis – the process of discovering useful information by
evaluating data. This is done through a process of inspecting,
cleaning, transforming, and modeling data using analytical and
statistical tools.
• Why is data analysis important?
• Analyzing data effectively helps organizations make business
decisions. Data is collected by businesses constantly: through surveys,
online tracking, online marketing analytics, collected subscription and
registration data (think newsletters), social media monitoring, among
other methods.
1. Big data
• The concept of big data - data that is so large, fast, or complex, that it
is difficult or impossible to process using traditional methods—gained
momentum in the early 2000s.
• Then, Doug Laney, an industry analyst, articulated what is now known
as the mainstream definition of big data as the three Vs: volume,
velocity, and variety.
Volume: As mentioned earlier, organizations are collecting data
constantly. In the not-too-distant past it would have been a real
issue to store, but nowadays storage is cheap and takes up little
space.
Velocity: Received data needs to be handled in a timely manner. With the
growth of the Internet of Things, this can mean these data are coming in
constantly, and at an unprecedented speed.

Variety: The data being collected and stored by organizations comes in many
forms, ranging from structured data—that is, more traditional, numerical data
—to unstructured data—think emails, videos, audio, and so on.
2. Metadata
• This is a form of data that provides information about other data,
such as an image. In everyday life you’ll find this by, for example,
right-clicking on a file in a folder and selecting “Get Info”, which will
show you information such as file size and kind, date of creation, and
so on.

3. Real-time data
• This is data that is presented as soon as it is acquired. A good example
of this is a stock market ticket, which provides information on the
most-active stocks in real time.
5. Machine data
• This is data that is produced wholly by machines, without human
instruction. An example of this could be call logs automatically generated
by your smartphone.

6. Quantitative and qualitative data

• Quantitative data—otherwise known as structured data— may appear as
a “traditional” database—that is, with rows and columns. Qualitative data
—otherwise known as unstructured data—are the other types of data that
don’t fit into rows and columns, which can include text, images, videos
and more.
Data Analysis Technique
a. Regression analysis
• Regression analysis is used to estimate the relationship between a set of
variables. When conducting any type of regression analysis, if there’s a
correlation between a dependent variable (that’s the variable or
outcome you want to measure or predict) and any number of
independent variables (factors which may have an impact on the
dependent variable).
• The aim of regression analysis is to estimate how one or more variables
might impact the dependent variable, in order to identify trends and
patterns. This is especially useful for making predictions and forecasting
future trends.
b. Monte Carlo simulation
• When making decisions or taking certain actions, there are a range of
different possible outcomes. If you take the bus, you might get stuck
in traffic. If you walk, you might get caught in the rain or bump into
your chatty neighbor, potentially delaying your journey.
• In everyday life, we tend to briefly weigh up the pros and cons before
deciding which action to take; however, when the stakes are high, it’s
essential to calculate, as thoroughly and accurately as possible, all the
potential risks and rewards.
c. Factor analysis
• Factor analysis is a technique used to reduce a large number of variables to
a smaller number of factors. It works on the basis that multiple separate,
observable variables correlate with each other because they are all
associated with an underlying construct.
• This is useful not only because it condenses large datasets into smaller,
more manageable samples, but also because it helps to uncover hidden
patterns.
• This allows you to explore concepts that cannot be easily measured or
observed—such as wealth, happiness, fitness, or, for a more business-
relevant example, customer loyalty and satisfaction.
d. Cohort analysis
• Cohort analysis is a data analytics technique that groups users based
on a shared characteristic, such as the date they signed up for a
service or the product they purchased. Once users are grouped into
cohorts, analysts can track their behavior over time to identify trends
and patterns.
• With cohort analysis, you’re dividing your customers or users into
groups and looking at how these groups behave over time. So, rather
than looking at a single, isolated snapshot of all your customers at a
given moment in time (with each customer at a different point in their
journey), you’re examining your customers’ behavior in the context of
the customer lifecycle.
e. Cluster analysis
• Cluster analysis is an exploratory technique that seeks to identify
structures within a dataset. The goal of cluster analysis is to sort
different data points into groups (or clusters) that are internally
homogeneous and externally heterogeneous.
• This means that data points within a cluster are similar to each other,
and dissimilar to data points in another cluster. Clustering is used to
gain insight into how data is distributed in a given dataset, or as a
preprocessing step for other algorithms.
f. Time series analysis
• Time series analysis is a statistical technique used to identify trends
and cycles over time. Time series data is a sequence of data points
which measure the same variable at different points in time (for
example, weekly sales figures or monthly email sign-ups). By looking
at time-related trends, analysts are able to forecast how the variable
of interest may fluctuate in the future.
g. Sentiment analysis
• Many companies overlook the value of qualitative data, but in reality,
there are untold insights to be gained from what people (especially
customers) write and say about you.
• With sentiment analysis, the goal is to interpret and classify the
emotions conveyed within textual data. From a business perspective,
this allows you to ascertain how your customers feel about various
aspects of your brand, product, or service.