Operationalize data-driven organizational development

How to automate and streamline improvement in your organization

As a member of an organization, you want the organization to continuously improve over time in order for it to be a healthier, more pleasant, and more meaningful place to work.

As a leader in an organization, you want to identify and communicate how people might improve, and focus improvement efforts on areas in which they will deliver the most positive impact to the organization.

How can we make these dreams a reality? The answer lies in three concepts: organizational development, operationalization and data-driven decision-making.

This article is also available in Norwegian

How to think about improving an organization

When we want to improve an organization, what we're actually trying to do is make the organization work better and suck less. Or, in more business-friendly terms: make it less dysfunctionional and more well-functioning.

No organization is 100% dysfunctional or 100% well-functioning, so it makes sense to think of well-functioning as an axis stretching from a place of more dysfunction and less well-function, to the opposite.

From dysfunction to well-functioning

Keeping this model in mind makes it easier to identify both aspects in an organization, and enables leaders to align more easily around when you need to focus on weeding out dysfunction, and when you can focus on planting well-functioning.

What is organizational development?

The process of improving an organization and its members is called organizational development.

When we practice organizational development, we are improving what an organization is able to do (capabilities), and how well it does it (well-functioning).

The practice of organizational development seeks to systematically improve the clarity, accessibility, and reusability of the know-how (aka intellectual capital) available to the organization, so we can improve our return on investment in it.

Organizational development can be broken down into:

  • People development seeks to improve the clarity, accessibility, and reusability of what people know (aka human capital).
  • Insight management seeks to improve the clarity, accessibility, and reusability of our documentation (aka structural capital).

This chart visualizes how these concepts all fit together:

Why prioritize organizational development

The motivation for prioritizing organizational development is to make the organization and its members more well-functioning

Here is what dysfunctionaltiy and well-functioning looks like in the context of an organization:

When we refer to the well-functioning of the members of the organization, we think about how clearly each person understands and are able to practice their roles.

Developing organizational members is not simply a benefit to the organization. It is also increasingly becoming a requirement of the modern worker. A study conducted by Manpower discovered some alarming numbers:

Only 8% of workers attribute switching jobs to higher salery, whereas 30% attribute switching jobs to a lack of professional and personal development opportunities.

These statistics clearly show that systematic investment in the development of people is a requirement for organizations looking to attract and retain the best people.

What is operationalization

Operationalization means to put into operation or use.

When you operationalize something, you take a set of plans or intentions (be it strategy, expectations, or insight), evaluate what is needed to execute those plans/deliver on those expectations/utilize those insights, and embed those specific mechanisms into the fabric of how work is being carried out.

From an organizational perspective, operationalization ensures that something gets done predictably, transparently, and effectively.

From a human perspective, operationalization helps you to do the right things the right way.

When something has been inadequately operationalized, we can't say for sure if something will get done, if it was actually done, or how it was done. We are also often dependent upon the efforts and follow-up of individual champions for that something to happen regularly and correctly.

An example (though non-human) of great operationalization is code executed by a computer. In this situation, there is a very high probability of the intitial plans and intentions being used and followed in accordance with expectations (provided that the code has been properly written and the bugs have been fixed). When you are looking to operationalize something, you might think of yourself as an organizational programmer.

What does it mean to operationalize organizational development?

When we say that we want to operationalize organizational development, we meant that we want to:

Ensure that the improvement of the organization happens predictably, transparently and effectively.

Why does this matter?

Because organizational development is often poorly understood in many organizations, by both its members and its leaders. As a result, how predictably, transparently and effectively organizational development actually gets done is anyone's guess, making it near impossible to hold neither leaders nor members accountable to their development responsibilities.

Unlike the products and projects we deliver to our clients where we have established uniform expectations of quality, the results of organizational development work are rarely held to a uniform standard, or any standard at all.

This is huge problem because organizational development done right is the number one factor impacting the well-functioning of the organization, which is a crucial ingredient to the retention of its employees and the long-term survival of the organization.

When done poorly, efforts are wasted on low-impact improvements which have no discernible impact on the capabilities of individuals, teams or the organization as a whole.

How to operationalize organizational development

To operationalize organizational development, we need some way of identifying and determining if the responsibilities of organizational development are being practiced predictably, transparently and effectively.

How it makes sense to divvy up and distribute the individual responsibilities of organizational development may differ from organization to organization, but here is a collection of responsibility best practices you can use as a starting point for discussion:

What is data-driven decision making?

The last piece of the puzzle is data-driven decision-making.

When we refer to something as data-driven, we mean that what we belive and act on is decided by data, rather than by intuition or personal experience.

Data-driven decision-making (DDDM for short) is defined as using facts, metrics, and data to guide your decision making.

According to a survey of more than 1,000 senior executives conducted by PwC, highly data-driven organizations are three times more likely to report significant improvements in decision-making compared to those who rely less on data.

By being data-driven in your decision-making you:

  • Cut down on the time and friction it takes to align people and make a decision because people are more likely to trust data than the biases and gut feelings of others.
  • Make more confident decisions because they are based on actual data and not just a hunch.
  • Become more proactive and less hesitant because you have data which points you to where you should act next.

What is data-driven organizational development?

Data-driven organizational development can best be summarized as:

Using data instead of hunches to decide where and how you prioritize your organizational development efforts, and to evaluate the impact of those efforts.

By being data-driven in your monitoring, decision making and review of organizational development efforts, you:

  • Replace knee-jerk efforts where you hope for a better outcome with deliberate efforts which produce meaningful and proven results.
  • Avoid efforts being dictated by people who yell the loudest, or by the most recent problem (also known as recency bias).
  • Help people with the problems they actually experience, as opposed to the problems you assume that they have.

If you do not already have a platform to operationalize responsibilities and make developmental decisions based on data, check out the Wecomplish platform.