Entry and contracting

Any OD intervention should clearly define the intervention’s goals, scope, and main expectations
of key stakeholders. Lippitt and Lippitt (1986) describe six phases to effectively manage the entry
and contracting phase in a consultant-client working relationship; “1) Engaging in initial contact
and entry, 2) formulating a contract and establishing a helping relationship, 3) Identifying
problems through diagnostic analysis, 4) setting goals and planning for action, 5) taking action
and cycling feedback, and 6) competing the contract (continuity, support, and termination)” (p.11).
Instead of offering a step-by step process,

French and Bell (1999) emphasize that contracting is repetitive, continually renewable, and
should cover the psychological and financial aspects. Moreover, the authors suggest clarifying
and agreeing on the intervention’s conditions, ground rules, deliverables, and price. Additionally,
to ensure a successful consultant-client relationship, the authors suggest paying particular
attention to trust issues, and five ethical dilemmas: “(1) Misrepresentation and collusion, (2)
misuse of data, (3) manipulation and coercion, (4) value and goal conflicts, and (5) technical
ineptness”. (p. 266). The analysis of information suggests paying special attention to the
clarification of goals, and expectation in any OD intervention, furthermore, given the high visibility
of the client, and the recent public scandals, any consultant-client relationship must address trust
issues and ethical dilemmas.

Organizational diagnosis and assessment

Literature suggests identifying the most appropriate models and tools to conduct the
organizational diagnosis and assessment. Harrison and Shirom (1999) propose the use of the
sharp-image diagnosis to examine the organization as a whole, and later focusing on specific
areas or issues. “…practitioners of sharp-image diagnosis start with a broad scan of an
organization but then select core problems and organizational challenges for a close up
examination” (p. 18).

Additionally, the authors emphasize on the need to use the open systems (OS) framework to
guide the initial phases of the organizational diagnosis, and then move to a specific areas of
analysis. The OS frame which includes various components -inputs, outputs, systems processing,
the environment, structure, culture, and systems dynamics, may be applied at organization, group
and individual levels. “The OS framework can help practitioners of diagnosis develop a broad
overview of the focal organization and its challenges” (p. 48). Furthermore, Harrison and Shirom
(1999) encourage the need to conduct targeted assessments to further findings of the
organizational diagnosis. “…the term assessment refers to more narrowly focused examinations,
whereas diagnosis is reserved for the preliminary stage of diagnosing basic problems and
challenges” (p. 183).

OD interventions
An articulated OD intervention should address key issues identified during the diagnosis phase,
and should be consistent with the organization’s culture and objectives. Schein (1992) sustains
that the analysis of organizational culture is a prerequisite to implement successful OD
interventions “Organizational learning, development, and planned change cannot be understood
without considering culture as the primary source of resistance to change” (p.xiv).

Moreover, Schein emphasizes that planned change processes must be managed by the top,
highlighting the attention of power issues, and the management of the organizational subcultures.
“Much of the work of organizational development practitioners deals with knitting together diverse
and sometimes warring subcultures, helping leaders, the dominant coalition, or the whole
managerial subculture client figure out how to integrate constructively the multiple agendas of
different groups” (p. 316). Additionally, the author mentions that leaders play an important role to
embed their assumptions on a work group, and therefore in the creation of a new culture. He
sustains that in mature organizations, people start reflecting on what has worked in the past
instead of the primary agenda of the leader.
Furthermore, to effectively manage a cultural change, Schein suggests working on six
mechanisms to embed the leader’s assumptions on the organizational culture. These six
elements are: 1) the areas where leaders pay attention to and reward, 2) how the leader allocate
resources, 3) the modeling behavior, 4) how the leader deals with critical incidents, 5) the criteria
the leader use for recruitment, selection, promotion, and 6) the way a leader communicates.

Additionally, and contrary to common organizational practices, Schein suggests to focus on

secondary mechanisms to reinforce the desired culture, among them the following: 1) the
organization design, and structure, 2) the organizational systems and procedures, 3) the
organizational rites and rituals, 4) the design of physical space, facades, 5) the stories, legends,
and myths about people and events, and 6) the formal statements of organizational philosophy,
values, and creed. Additionally, to the understanding of organizational culture, OD interventions
should use specific OD models and tools to manage resistance, engage key stakeholders, and
develop internal capabilities.

Bridges (1991, 2003) provides useful advice to manage the period of uncertainty in any change
process. He advocates the management of the transition process, the “three-phased process that
people go through as they internalize and come to terms with the details of the new situation that
the change brings about” (p. 3). Strebel (1996) considers that most change initiatives lack the
attention of personal compacts: the reciprocal obligations and commitments made by employees
and organizations.

The author classify personal compacts in three dimensions: formal dimension, which relates to
the understanding of new functions and responsibilities, the psychological dimension, which
addresses elements of mutual expectation and reciprocal commitment, and the social dimension
which relates to the alignment of stated values and mission and the company’s practices and
management’s attitudes towards them.

Literature analysis for OD interventions at organizational and group levels, also indicate the need
to implement a collaborative and participative approach. French & Bell (1999) examine large
scale, group, and individual OD interventions, emphasizing that confrontation meeting and
strategic management activities are better suited for management groups, while future search
conferences are better suited for a wide spectrum of organizational stakeholders.

Additionally, French and Bell advocate the appreciative inquiry (AI) method to focus on the
strengths of the organization and future things that are valued by its members. Furthermore,
Hammond (1996) promotes the use of AI to look into the future while accentuating positive
aspects of the organization, “Appreciative inquiry suggests that we look for what works in an
organization. The tangible results of the inquiry process are a series of statements that describes
where the organization wants to be, based on the high moments of where they have been.
Statements are grounded in real experience and history, people know how to repeat their
success” (p.7).

AI uses a summit to engage participants in a collaborative process to discover what the

organization has done to be successful in the past; subsequently participants collectively dream
about the new future, and later design the specific strategies and objectives to achieve the
organization’s destiny.

Additionally, AI helps to gain the commitment of people to advance the implementation phase,
“Through a workshop format, the participants stir up memories of energizing moments of success
creating a new energy that is positive and synergistic. Participants walk away with a sense of
commitment, confidence, and affirmation that they have been successful” (p.7) Marquardt (1999)
propose action learning, a methodology to find practical solutions for problems, while enhancing
the team’s ability to learn. “Simply described, action learning is both a process and a powerful
program that involves a small group of people solving real problems while at the same time
focusing on what they are learning and how their learning can benefit each group member and
the organization as a whole” (p. 4)

Contrary to the collective and provocative AI method, Kotter & Cohen (2002) advocate a 8 step
methodology to manage organizational change: “Increase urgency, build the guiding team, get
the vision right, communicate for buy-in, empower action, create short term wins, don’t let up,
make changes stick” (p. 7).

Senge (1990) promotes a systemic and interrelated approach to manage change in

organizations, while transforming them into learning organizations. Senge explains that
organizations face learning disabilities that affect their capacity to continually learn, and
transform. These learning disabilities result in lack of flexibility to adapt to new demands,
incompetence to critically analyze internal performance, failure to correct behavior, and
ineffectiveness to implement deep and sustained changes. To correct those learning disabilities,
Senge proposes the use and practice of five disciplines: personal mastery, mental models,
shared vision, team learning, and systems thinking. According to Senge (1990) a learning
organization is “an organization that is continually expanding its capacity to create its future” (p.
14). Furthermore, Senge, Kleiner, Roberts, Ross & Smith (1992) provide practical examples and
case studies to guide companies in their transformation to learning organizations.

Another important element for consideration in the implementation of OD interventions is the

definition of a dedicated team to work full time in the implementation with specific roles, and
objectives. Moss Kanter, Stein & Jick (1992), define three key roles in a change intervention: a)
the strategist, a role reserved for visionary leaders, whose main function is to identify the need for
change and create the conditions to make it happen, b) the change implementer who will develop
the required strategies and plans to execute change initiatives, manage resistances and make
changes happen, and c) the role of change recipients that represent the vast variety of individuals
that must adapt and adopt new changes. As literature suggests OD interventions vary from a
large-scale, group, and individual approaches.

Therefore, any change intervention should employ a combination of OD models and tools best
suited for the culture of the organization, the characteristics of the change process, and past
experiences. Additionally, the intervention should pay attention to the psychological and
emotional elements that people go through as they internalize the change process. Furthermore,
the use of Kotter & Cohen’s 8 step change management process model will provide an effective
framework to target deliberate change efforts to effectively alter individual, group and
organizational performance.

Measuring results and impact of OD interventions

Processes utilized for measuring results and impact of OD interventions range from the analysis
of qualitative elements such as the adherence to a company’s policies and processes, to more
elaborated approaches, such as cost-benefits analysis, and the use of quantitative and qualitative
metrics, balanced scorecards, and sophisticated models to determine the return of investment.

Herman, and Renz (1998) examine approaches used by nonprofit organizations to measure their
results. They identified the adherence to policies and procedures to measure the achievement of
the nonprofit organization’s outcomes. “Institutional theory predicts that when outcomes are
difficult to measure, organizations are likely to emphasize following approved procedures to
achieve or maintain their legitimacy (p. 29). The authors conducted a study to determine the
relationship between board effectiveness and organizational effectiveness. Among the
effectiveness measures cited by senior executives of nonprofit organizations were the following:
its mission statement, the use of a form to measure client satisfaction, organization’s planning
documents, the use of a performance appraisal form, by-laws containing a statement of purpose,
etc.

Sawhill, J. & Williamson D. (2001) reviewed the model for measuring performance in the nature
conservancy consisting of three broad areas: impact, activity and capacity. The authors conclude
the importance of strategic alignment for the nature conservancy “An integrated system of
performance measures is no substitute for a compelling mission, uplifting vision, clear goals, and
innovative strategies. It would be a serious error to imagine that a nonprofit can develop effective
measures in the absence of strategic alignment” (p. 385)

Berry, Fisk, and Zimmerman (1997) suggest the use of a more objective measurement approach
to identify the value of a defined program and make a decision: a cost-benefits analysis. “Cost-
benefit analysis consists of three steps: calculate costs, calculate benefits, and compare
results….In short, cost-benefits analysis helps trainers and managers decide what to do..” (p.
143).

Kaplan and Norton D. (1996) propose the use of quantitative and qualitative elements in the
evaluation process. They advocate the use of the balanced scorecard to translate strategy into
action. The authors state that the balanced scorecard is a management system to channel the
energies, abilities, and specific knowledge held by people throughout the organization toward
achieving long-term strategic goals. Furthermore, Kaplan (2001) reveals that nonprofit
organizations lack financial measures to track their performance.

After an elaborated literature review on the topic, Kaplan recommends the use of balanced
scorecard for managing nonprofit organizations “Thus, the literature concurs with the need to
articulate a multidimensional framework for measuring and managing nonprofit effectiveness.
This scorecard would seem to provide just such a framework”. (p. 357).

Additionally, Kaplan emphasizes the importance of aligning strategy with performance

measurement “Strategy and performance measurement should focus on what output and
outcomes the organization intends to achieve, not what programs and initiatives are being
implemented” (p. 357). He sustains that the use of the balanced scorecard in nonprofit
organizations helps align staff’s day-to-day activities with the organization’s mission and key
initiatives “The balanced scorecard has enabled the nonprofit organizations to bridge the gap
between vague mission and strategy statements and day-to-day operational actions” (p.369) The
model uses 4 key perspectives with specific objectives, metrics, targets, and initiatives.

The financial perspective includes examples applicable to nonprofit organizations, such as net
amount of funds raised, or the improvement in net asset and liquidity to support new service
development. The customer perspective includes satisfaction and retention of clients, and market
growth. The learning and growth perspective has objectives and metrics to improve training,
career development, and employee retention. The internal perspective contains research and
development activities to support the achievement of the organization’s mission, and to improve
client satisfaction and retention.

Following the line of sophisticated measurement systems, Phillips (1994) declares that although
top management requires more sophisticated calculations such as return of investment (ROI),
only a few programs should be measured using ROI because of complexity of the evaluation. “In
the ROI formula the costs of a program are subtracted from the total benefits to produce the net
benefits, which are then divided by the costs” (p. 12). Additionally, the author sustains that OD
programs are among the most difficult HRD programs to evaluate, because the several factors
included.

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