This week I've been facilitating a training program on organization development (OD). One question that has come up repeatedly in different ways and at different times, is where should organization development consultants 'sit' in an organization? Delegates want to know whether organization development is best placed as part of an Human Resources (HR) function, part of a strategy department, as an independent unit reporting to a COO, or something else.
It's not an easy question to answer as different organizations have different views on the value of organization development and this perspective seems to color where it is 'put'. In a useful discussion "What kind of OD practitioner are you?" Fred Nickols suggests that:
Internal OD practitioners are typically found in one of three areas: as part of Training and Development; as a stand-alone OD unit; and as an Organizational Effectiveness (OE) unit. In the first two cases, the OD is typically of the "soft" variety. OE units are typically practicing "hard" OD.
By "soft" approaches Nickols means things that include coaching, motivating, mentoring, conflict management, group facilitation, and team building. By "hard" approaches he means things like business process re-engineering, total quality management, ISO 9000, six sigma, lean. He goes on to say that:
External OD practitioners fall into two groups as well: those practicing "soft" OD and those practicing "hard" OD.
It's my guess that whether internal or external, those practicing "hard" OD find more favor with senior executives and other managers focused on measurably and often tangibly improving performance, whether of people, processes or the bottom line. Moreover, I'd also guess that External OD consultants practicing "hard" OD are probably the best paid.
It's been my observation that internal OD practitioners using "soft" approaches typically find themselves in supporting roles of limited influence and, in some cases, they have been there primarily for show, so an executive can say, "Yeah, we have an OD unit." External consultants using "soft" approaches are still in vogue and on occasion work in the rarified atmosphere of the executive suite but these are few and far between.
Whether OD consultants practice "hard" or "soft" approaches depends partly on their own backgrounds, skills, experiences, and preferences and partly on what the organizational expectations of the consultant are.
Unfortunately many organizations are not clear on what OD is, why they need it, how it should be practiced, and the ROI they are expecting to get from it. Agreeing that OD:
a) Is integral to delivering the business strategy
b) Is a process for developing the capability of the whole system
c) Should be practiced by engaging and involving internal and external stakeholders through humanistic values (using soft approaches)
d) Can be evaluated and measured to ascertain ROI (using hard approaches)
helps in the discussion of where it should be based, which is as an independent, objective unit reporting into the strategy department or a COO.