Organization Development (OD) As Diagnostician: The Emergent Role Of OD And Technology To Manage Workplace Stress And Drive Business Performance

Chris Forando, VP, Organization Development, L’Oreal USA

Chris Forando, VP, Organization Development, L’Oreal USA

An increasingly disruptive and hypercompetitive business environment, compounded by a pandemic, social unrest, and ever shifting consumer demands, has created unprecedented change for organizations, and subsequently, chronic stress for employees. With mounting pressure for improved financial performance, organizations are engaged in an incessant drive to achieve more with less, at great cost. Organizations must confront the impact that workplace stress has on human and business performance, and take action to restore the health and wellness of employees. This article offers a brief overview of an example on how OD and HR, in close partnership with business leaders, can play a strategic role in strengthening business performance by leveraging technology and integrated data analysis to isolate root cause issues that cause harmful stress.

Organizations often become immersed in a mindless pursuit of resolving symptomatic issues rather than addressing root cause origins, leading to a recurring pattern of futile, and wasteful, solutions that offer nothing more than temporary relief. Further, problems may be separated into business and ‘people’ issues, with different teams committed to each, unintentionally exacerbating the situation. For progressive companies, Organizational Development (OD), enabled by technology and data analytics, is emerging as the ‘tip of the spear’ to objectively guide leaders and teams into and through the change void by means of systemic analysis and diagnosis of root cause issues that erode both human performance and the execution of strategic imperatives.

"To compete on a sustained basis and be successful, organizations must balance energy expenditure and renewal with regards to its human ‘fuel’"

In this case example, an opportunity for OD originated when a review of employee engagement survey comments by HR suggested an unacceptable level of team stress. The problem was postured as “business performance impacted by eroding employee morale and motivation and increased turnover”. Accordingly, the OD team was asked to conduct a comprehensive system analysis and to propose recommendations for the team to(1) return to growth AND (2) be a great place to work.

Using a technique learned in the U.S. Coast Guard for safely navigating a ship by triangulating three terrestrial reference points to accurately determine location off coastlines, a methodology was designed to integrate and triangulate internal and external data points to pinpoint root cause factors. A thorough analysis was conducted that involved multiple ‘reference points’: • 56 employee interviews (all levels, all teams)

• YoY employee engagement data
• YoY sales reports
• YoY turnover reports
• leadership 360 scores
• customer data and feedback
• operations survey data

A comprehensive analysis revealed several core factors suspected of impacting business performance.

• Work overload,
• Excessive decision makers,
• Lack of accountability and authority, and
• Lack of role clarity amongst teams and individuals

What about the stress? Stress was acknowledged as an outcome and not a root cause. To examine workplace stress, the Occupational Stress Inventory (OSI) was administered online and had a 77% participation rate. The OSI is a self-assessment to examine organizational stressors (overload, ambiguity, boundaries, etc.), strains (vocational, psychological, physical, and interpersonal), and personal resources for coping (recreation, social support, rational skills, etc.). Using batch data obtained through the assessment platform we were able to analyze data by team and level, amongst other variables and to explore relationships with and between stressors and strains. The analysis revealed the most significant stressors were:

• Role Overload (RO): Extent to which work demands exceed resources and extent to which individual is able to accomplish workloads

• Role Ambiguity (RA): Extent to which priorities, expectations, and evaluation criteria are clear

• Role Boundary (RB): Extent to which individual is experiencing conflicting role demands and loyalties

According to the OSI’s normative data, only 2% of the population scored in the high stress range (>70) in these areas, yet for this team it was 26% for RO, 16% for RA, and 7% for RB). The analysis revealed close relationships between the three stressors RO, RA, and RB and that all three showed strong correlations with Vocational Strain. Vocational Strain (VS) is defined in the OSI as “The extent to which an individual is having problems in work quality or output and attitudes towards work.” Ultimately, it was concluded that the combined stressors of Role Ambiguity (unclear roles, responsibilities, and expectations) and Role Boundary (conflicting role demands, decision makers, and loyalties) were driving Role Overload (demands exceed resources), which showed a strong relationship with vocational strain (Figure 1).

Role overload, a major complaint of employees in the course of the interviews, was not a root cause, but rather an outcome of the combined impact of the other two primary stressors. The root cause factors of stress had been isolated. More powerful was the fact that the OSI analysis fully aligned with the core factors identified in the comprehensive analysis. Together, the integrated analysis enabled OD to prescribe precise recommendations towards returning the team to growth AND being a great place to work.

The failure to effectively manage employee stress can be catastrophic. Prolonged stress has been associated with depression, anxiety, violence, loneliness, panic, substance abuse, and personality problems. At work, increased absenteeism, health care costs, turnover, and interpersonal conflict, as well as reduced employee motivation and engagement can have a profound negative impact on productivity and profitability, increasing the risk of organizational ‘atrophy’, and compromising competitive posture.

Organizations, much like the human body, are dynamic open systems constantly assessing and adapting to and endless array of environmental stimuli, all of which requires energy – fiscal, physical, and psychological. To compete on a sustained basis and be successful, organizations must balance energy expenditure and renewal with regards to its human ‘fuel’. Just as health professionals utilize a variety of devices and tests to evaluate patient health and vitality by detecting and diagnosing potential threats, organizations will increasingly come to depend on a specialized OD capability empowered by a technologically driven ‘sensor suite’ to continuously monitor performance and health, diagnose conditions, and prescribe ‘treatments’ to ensure vitality, sustainability and a strong competitive stance for the future.

Weekly Brief

Top 10 Employee Engagement Solution Companies in Europe - 2020

Read Also

To Survive, We Thrive

To Survive, We Thrive

Dr. Heike Virmond, Global Vice President People, Culture & HR, Gategroup
How To Boost Company Performance Through Effective Organisational Development

How To Boost Company Performance Through Effective Organisational Development

An interview with Birthe Mester, Managing Director, Global Head of Performance, Engagement and Culture, Deutsche Bank
The Importance of Change

The Importance of Change

Jerry Pico, Head of Learning & Development Europe, Daiichi Sankyo Europe GmbH
Purpose EX and DI&B-Can HR Tech Help to Create a Connected Employee Experience?

Purpose EX and DI&B-Can HR Tech Help to Create a Connected Employee Experience?

Derek Bruce, Director Leadership Development, Signify
Engaging Our Employees To Live A Healthier Lifestyle

Engaging Our Employees To Live A Healthier Lifestyle

Angelika Inglsperger, Group Head People, Allianz
Human Capital Analytics Leap Forward

Human Capital Analytics Leap Forward

Rick Lueders, Vice President Business Strategy, Bullseye Engagement