Benefits and Limitations of Organizational Development
Benefits of OD
•Change throughout the organization •Greater Motivation •Higher Job Satisfaction •Reduced absences •Increased Productivity •Lower turnover •Better quality of work •Improved teamwork •Better resolution of conflict •Commitment to Objectives •Increased willingness to change •Creation of learning individuals and groups
Job satisfaction is the extent to which a person is gratified or fulfilled by his or her work. A satisfied employee tends to be: • absent less often • Make positive contributions • Stay in the organization A dissatisfied employee tends may be: • Absent more often • May experience stress that disrupts co-workers • Continually look for another job
Environmental impact Job satisfaction is one part of life satisfaction. The nature of a worker’s environment off that job indirectly influences his or her feelings on the job. Similarly, since a job is an important part of life for many workers, job satisfaction influences general life satisfaction. The result is a spillover effect.
A satisfied employee tends to be absent less often. Although the connection is not always sharp. Some absences are caused by legitimate medical reasons. Involuntary (medically related) absenteeism can sometimes be predicted (e.g., surgery) are often be reduced through thorough pre-employment physical exams and work-history record checks.
Turnover proportion of employees leaving an organization during a given time period. Excessive employee turnover can have several negative effects on an organization Separation Costs Training Costs Vacancy Costs Replacement Costs Morale Effects
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Quality is the total set of features and characteristics of a product or service that determine its ability to satisfy stated or implied needs. Quality is important because: • Serves as the basis for competition • Improving quality tends to increase productivity (making high quality products results less waste and rework) • Enhancing quality lowers costs
Type of Benefit
Specific Benefit Organizational Examples
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Increased Productivity Improved Quality Improved customer service
Ampex: On-time customer delivery rose 98%. K Shoes: Rejects Per million dropped from 5,000 to 250 Eastman: Productivity rose 70%
Quality of Work Life Lower Stress
Milwaukee Mutual: Employee Assistance program usage dropped to 40% below industry average
Lower turnover, Absenteeism Fewer injuries
Kodak: Reduced turnover to one- half the industry average. Texas instruments: Reduced costs more than 50% Westinghouse: Costs down 60%
•Increased innovation, flexibility
IDS Mutual Fund Operation: Improved flexibility to handle fluctuations in market activity. Hewlett-packard: Innovative orderprocessing system
Ingredients of Effective Teams
• Supportive Environment – involves encouraging team members to think like a team, providing adequate time for meetings, and demonstrating faith in members capacity to achieve • Skills and clarity – Team members must be reasonably qualified to perform their jobs and have the desire to cooperate. Members can work together as a team after the members know the roles of all the other whom they will be interacting.
Ingredients of Effective Teams
• Superordinate Goals – A major responsibility of managers is to try to keep the team members oriented toward their overall task. Sometimes, unfortunately, an organization’s policies record-keeping requirements and reward systems may fragment individual efforts and discourage team. • Team rewards – These may be financial, or they may be in the form or recognition. Rewards are most powerful if they are valued by the team members, perceived as possible to earn, and administered contingent on the group’s task performance.
Potential Team Problems
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