AboutLeo Lingham Expertise management consulting process, management consulting career,
management development, human resource planning and development,
strategic planning in human resources, marketing, careers in
management, product management etc
Experience 18 years working managerial experience covering business planning, strategic planning, corporate planning, management service, organization development, marketing, sales management etc
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24 years in management consulting which includes business planning, strategic planning, marketing , product management,
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Expert: Leo Lingham Date: 5/26/2008 Subject: ORGANISATIONAL DEVELOPMENT
Question hi leo please explain why do we need to carry organisational analysis & diagnosis ,what is the and process invoved ,outcomes & obstacles if any &how to overcome obstacles.
Also i would want to know difference between the terms organisational analysis and diagnosis
Answer MANASI,
HERE IS SOME USEFUL MATERIAL.
REGARDS
LEO LINGHAM
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The Organizational Analysis is an essential element of organizational development. An OA report presents a compilation of the information obtained from the individual CheckPoint results . The report provides a factual summary of the perceptions of a management group with input from the manager's bosses, peers and direct reports.
The value of the Organizational Analysis is in providing a description of where you are now. This has been described as "the fifth point of the compass." The "fifth point" concept means successful management decisions regarding the direction to take a company must be predicated on knowing where you stand now. False assumptions often lead to wasting time, effort, and resources. The OA report is a guide to future development based on statistically accurate data. When you know where you are and where you want to go, you can chart your course with confidence and certainty.
The Organizational Management Analysis process examines a company's culture and provides insights to the alignment of management groups with the company's goals and objectives. This information is used to analyze the human capital aspects associated with an organization's long-term strategic objectives. The report also provides an analysis of organizational development priorities and defines organizational training needs.
Ask These Questions:
Would we benefit from creating a baseline measurement against which to track progress in organizational development activities?
Do the managers and employees share my vision, mission, and values for organizational success?
Do we have a system to measure/quantify management effectiveness?
Are the internal management practices in alignment with achievement of organizational goals or is there a negative correlation?
Do the behavioral skills of supervisors contribute to a positive synergistic impact on performance for my company?
are we settling for too little productivity from my management team thus creating a negative profit impact?
If you've answered yes to any of these questions, Organizational Analysis can help.
Organizational analysis has traditionally been concerned with three distinct areas:
1. organization theory,
2.organization behavior and
3.strategic management.
The former examines the design and structure of organizations; the complementary processes of differentiation (the division of labor and the grouping of functions) and integration (the distribution of authority); the relationship between organizations and their social, political, institutional, and economic environments; and the nature and role of politics, power, and conflict that may result from inherent tensions in coordinating a range of disparate functions and interests.
The focus of organizational behavior is human behavior in a variety of settings within work organizations, the extent to which management is able to influence this, how this might be achieved and with what effects.
Strategic management has as its focus an analysis of the organization in its environment, examining the processes by which organizations position themselves and seek to marshal resources and capabilities to support and implement strategies. It is concerned with how organizations match, or fail to match, organizational capabilities and strengths with external opportunities and constraints.
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Organizational Analysis
Organizations must be flexible in responding and adapting to fluctuating markets and contemporary customer needs. In order to change, organizations must first identify their current state through a phase of introspection and discovery.
Employees are usually ready to adapt, but they need to have the opportunity to explore their ideas and options in the context of a system wide examination. When a leader only has the time to analyze roles, goals and duties with one or two positions at a time, the patchwork decisions make matters even harder to resolve.
An organization analysis tackles the entire structure and seeks a general, rather than piecemeal solution. An organization analysis involves an examination of underlying issues. Some of these issues might include work processes, organization structure, management process, rewards, and people processes.
Change Management
A Rapidly changing business environment requires that organizations plan and control organizational and behavioral change. Change may be influenced by several internal and external factors:
Innovations in product, technology, materials, work processes, organizational structure, and organizational culture
New and shifting markets
Actions of global competitors, work force values, demands, and diversity
Regulatory and ethical constraints from the environment
Individual development and transition
Organizations often recognize the need for change, although they may be unsure of the methods for managing it.
THE SOLUTION LIES IN THE FOLLOWING
System-wide organizational assessment
Strategic planning
Individual and organizational development and training
Quantify management effectiveness
Track progress in organizational development
Factual summary of how management is perceived
Baseline measurement of your organization's effectiveness
Examine company culture
Analyze organizational development priorities
Define organizational training needs
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THE ORGANIZATIONAL ANALYSIS COULD INCLUDE:
ENVIRONMENTAL ANALYSIS
Environmental analysis is defined as the process by which strategists monitor the economic, governmental, legal, market, competitive, supplier, technological, geographic, and social cultural settings to determine opportunities and threats to their firms / company / organization. Environment diagnosis principally consists of managerial decisions made by strategist for analyzing the significance of the data like Strengths, weakness, opportunities and threats of the organization to has to design their own strategy for formulation, implementation and controlling the internal environmental factors.
Environmental analysis helps to strategic executive and manager to diagnosis of strategic competitive force and components of strategic management. However, internal environment of the organization is a quite essential and important from the point of view of the environment analysis. It is the cornerstone of the new and exiting business opportunity analysis too.
For instance, the individual life success depends on his innate capabilities like psychological factors, traits and skills. These are to the cope with the environment then will be got success otherwise failure. The survival is the basic elements and success of the business organization, it has depend on its own strengths in terms of resources like money, men, machinery, materials, market and methods as its command. Organization success depends on effective utilization of physical resource, financial resources and human resource skills. These are adaptability to the business environment.
Every business organization principally consists of internal environment factors and set of external environmental factors. In this chapter, we shall discuss only the internal environment of the organization/company.
Internal environment factors are generally considered as controllable factors of the organization. Internal environment factors are important to business like personal (human) resource department. marketing department, production department, physical facilities, accounting and finance departments and swot analysis. Therefore, the organization controls over these factors, these factors are modified or alter by the organization that suit for the business environment.
INTERNAL ANALYSIS OF THE ORGANISATION / COMPANY
Formulation of an effective and efficient strategy has based on a clear definition of organization mission, an accurate assessment of the external environment and through internal analysis of the organization. Organization requires success it needs at least three ingredients. They are as listed:
Strategy must be consistent with conditions in the competitive environment
Strategy must place realistic requirements on the organization / companys internal resources and capabilities.
Strategy must be carefully formulated, implemented, controllable and executed.
Internal analysis of the organization is to difficult and challenging one to strategist.
An internal analysis has leads to design a realistic organization profile. It frequently involves tradeoff, value system judgments, educated and skilled guess as well as objective and standardized analysis. A systematic internal analysis leads to main objective of the organization profile. It is essential to develop strategy and design a realistic mission for achievement of the strategy.
Internal analysis of the organization must identify the strategically strengths, opportunities, weakness and threats that are based on organization strategy. Organizational analysis identifies suitable strategy that based on the SWOT analysis.
Internal analysis can be achieved by first identifying key internal factors like value system, mission objectives, management structure and nature, integrated power relationship, human resource, company/organization image and brand equity, physical assets, R&D, technological capabilities, marketing resource and financial resource factors and secondly by evaluating these factors.
THE VALUE OF SYSTEMATIC INTERNAL ASSESSMENT
The value system of internal assessment is essential from the point of view of strategy formulation by the experienced strategist of the organization / company. The value system applies to either large or small business concern. It is critical in developing a successful business strategy. Regardless of the favorable opportunities in the environment, a strategy must be considered the essential internal strengths, weaknesses, opportunities and threats of the organization if such opportunities are to be maximized for accomplishment of goals.
The value systematic internal analysis is particularly essential in small business organizations. Small business organizations are faced lot of problems like limited resource and markets. These organizations are flexible and capable to capture selected markets and effectively channel their limited resource and maximize these limited market opportunities. Internal analysis is the basis objectives of the organization.
Steps/Process in the Development of a Organizational / Company Profile
Company / organization profile focus on determination of strengths and weakness of the strategic environment of the business. Identifying and evaluating strategic internal factors are based to accomplish to organization future strategy. The major steps are important to development of an organization / company profile. They are listed below:
Stage one -- Identification of Strategic Factors
Stage two --Using Value Chain Analysis
Stage three -- Evaluations of strategic internal factors
IDENTIFICAION OF STRATEGIC FACTORS
An important identification of strategic factors approach as listed below:
1. Functional approach
2. The value chain approach
FUNTIONAL APPROACH
Functional approach refers to Organizations basic capabilities; characteristics, swot analysis and limitation are the key strategic factors. Functional approach key strategic factors are as follows:
Marketing
Finance and accounting
Production /operation/ technical
Human resource development
Organization of general management
Marketing
Marketing deals with the following issues:
Organizations products / service; product life cycle and marketing strategy.
Concentration of sales in few products or little customer segmentation.
Ability to gathered information about the market.
To know the market share or sub market share.
Product/service mix and expansion potential: to know the life cycle of key products; to know the profit or loss of the product/service.
To clearly know the channel of distribution; number, coverage, and control.
To maintain effective sales organization: to find out knowledge about the customer needs.
To improve product/service quality with image and reputation of brand name.
Efficient and effective utilization of available resource for effective sales promotion and advertising.
To aware of the pricing strategy and pricing flexibility.
To effective monitoring and feedback of the marketing functions and expansion of product
Effective implementation of after sales service and follow up.
To keep standards, goodwill and brand loyalty.
Finance and Accounting
Finance and accounting functions refers to:
Ability to raises short term and long-term capital: either debt or equity.
To maintain good corporate level resource.
To know the cost of capital relative to industry and competitors
Tax consideration
To build up effective relationship with owners, investors, financial institution and stock holders.
To know the leverage position: capacity to utilization financial strategies, like lease or sale and lease back.
To aware of the cost of entry and barriers of the entry.
To know the price earning ration
Present working capital position of the organization.
Effective cost control and ability to minimize cost of expenditure for production of goods and service.
Financial size of the organization.
Efficient and effective accounting system for cost, budget, and profit planning of the organization.
Production/Operation/Technical
Production or operation or technical refers to:
To know the present raw material cost and availability
Inventory control system of the organization.
Location facilities; layout and utilization facilities.
Technical efficiency and effective utilization of technical resource in the organization.
Effective use and implementation of subcontracting.
Degree of vertical integration in terms of value added and profit margin of the product.
To know the efficient and cost benefit of production techniques.
Effective utilization and implementation of operation control procedure: design, scheduling, purchasing, quality control and efficiency.
To know the costs and technological competencies relative to industry and competitors.
Research development, innovative, advance ethnological development.
Patents, trademarks and similar legal protection for their organization products/service.
Human Resource Development
Human resource development refers to the following:
Effective management of the human resource in the organization.
Improvement of employee skill and morale.
Labor relations costs compared to industry and competition from present industry scenario.
Efficient and effective formulation and implementation and controlling of the policies.
Effective utilization of incentive to motivate employees performance.
To know the ability to level peaks and valleys of employment.
To regulate employee turnover and absenteeism.
Specialized skills and experience.
Organization of general management
Organization of general management refers to the following:
To know the organization structure.
Organization image and prestige to public world.
Organization record for achieving goals and objectives.
Effective utilization of resource and overall organization control system.
To effective monitoring organization cultural climate.
Effective utilization of systematic procedure and tools and techniques in decision-making.
To know the top management skills, capabilities and interest.
Effective implementation strategic planning system.
To keep and maintain intra organization synergy (multibusiness)
Some of which would be the focus of internal analysis in most business organization.
Organization is not likely to consider all of the factors are potential strengths or weakness. Strategist has develop or review the factors which are important for successful of the organization.
For the Analysis of the organization, firstly, a strategist has to analyze the past trends like sales, costs and profitability. These trends are the major importance in identification of the internal factors of the organization. Further this identification should be based on a clear picture of the nature of the organizations sales trends. An anatomy of past trends has broken down by product lines channels of distribution of goods and service into different segmentation of key customers, geographical region and sales approach should be developed in detail. A similar anatomy of past trends should focus on costs and profitability. Strategist has to conduct detailed investigation of the organizations performance history that helps isolate internal factors influencing to sales, costs and profitability or their interrelationships. The above factors are important in future strategy decisions.
Identification of strategic factors also requires an external focus of the organization. Strategist isolates key internal factors through analysis of past and present performance like industry conditions / trends and comparisons with competitors. In addition, strategic internal factors are often selected for in depth evaluation because organizations are contemplating expansion of products or markets, diversification. Strategist carefully scrutinizes the industry under consideration of current competitors. This is a key means of identifying strategic factors, if an organization is evaluating its capabilities more into unfamiliar markets.
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INTERNAL ORGANIZATIONAL ANALYSIS
-plan to change operational methods [ change in skills/ knowledge]
-plan to change technology [ change in knowledge/skills]
-organization restructuring [ change in job functions]
-changes in corporate strategy [ change in knowledge /skills]
-changes in the role of jobs. [ change in knowledge / skills]
Levels of Analysis
1. Organizational Analysis
-Identification of short- and long-term goals
-Identification of human resource needs
-Evaluation of methods of meeting HR needs (e.g.,
selection, training)
-Assessment of resource availability
-Evaluation of support for transfer of training
2. Task (Job) Analysis
-Identification of: tasks
-standards
-optimal procedures
3. Person Analysis
-Evaluation of individual against standards
-Identification of deficiencies
-Identification of causes (e.g., motivation vs. ability)
4. Demographic Analysis
-Assess the specific training needs of various
demographic groups (e.g., the disabled, ]
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THE OBSTACLES / BLOCKAGES ARE OFTEN,
-lack of leadership.
-lack of knowledge/ understanding the importance.
-lack of participation of the managers.
-lack of align of the operation with the strategies.
-lack of flexibility
etc etc.
AN EFFECTIVE LEADERSHIP CAN EASILY OVERCOME
THESE OBSTACLES.
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THE DIFFERENCE BETWEEN ORG.ANALYSIS AND
ORG.DIAGNOSIS IS
ORG.DIAGNOSIS IS THE FIRST STAGE, WHERE WE COLLECT
INFORMATION IN A SCIENTIFIC MANNNER.
Organizational Diagnosis
Organizational Diagnosis helps organizations identify the “gaps” between “what is” and “what ought to be.” Once we gain a shared vision of the desired state, we identify barriers and work toward solutions.
The Six-Phase approach to organizational diagnosis is tailored to the specific needs of each co:
Phase 1: Define
develop a shared understanding of the task, issue, or problem along with a plan for diagnosis.
Phase 2: Diagnose
examine organizational archival reports/documents and utilize information gathered through interviews, focus groups, questionnaires & surveys, along with objective observations to collect relevant data.
Phase 3: Analyze
After collecting the data, use statistical analysis methods to interpret the data and develop practical recommendations.
Phase 4: Presentation of Findings
This phase involves determining an effective intervention strategy.
Phase 5: Action Planning
We work with key players from the organization to develop an action plan that:
Fits the needs of the organization
Will yield measurable results
Will enhance the organization’s capacity to manage change
Is catered to the organization’s situation, culture, context, and maturational cycle
Phase 6: Reinforce
maintaining a focus on the desired state and helping organizations sustain change initiatives. The reinforce phase ensures effective implementation of our action plan and outlines the next steps to take once the action plan has been implemented.
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ORG.ANALYSIS IS THE SECOND STAGE, WHERE WE ANALYSE THE
INFORMATION IN A SCIENTIFIC MANNNER AND DEVELOP
A STRATEGY / ACTION PLAN.
Culture and Climate Analysis
Employee Opinion Analysis
Market Research Analysis
Competitive Analysis
COMPANY SWOT Analysis
Environmental Scan ANALYSIS / Development
Skill and Competency Assessment
Customer Input or Feedback ANALYSIS
Group and Individual Assessments, and 360 Evaluations
FROM THESE WE DEVELOP
Development of Master Strategies
Development of Goals
Development of Objectives
Development of Tactics
Structural Redesign
Change Planning, Implementation Design, and SUPPORT SYSTEMS.
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