The second major stage of organization model started to emerge around the middle of the 20th century.   It was heralded by the work of the humanist psychologist like Carl Rogers, Abraham Maslow and applied to organization life by people like McGregor and Herzberg.

This movement, if one wants to call it that, added another component to how we viewed and led organizations.  If you recall the first stage was to view the organization as a machine and to improve its performance we had to fine tune the way the machine operated. Most of the focus was on the structure and flow of work through the system.  In this worldview the people were recognized as providing the energy that made the machine work, but they were viewed as just another part of the machine.  Each individual carried the same amount of energy and hence one person was just as good as another.

The second stage, what I call the Humanist or Organic stage began to recognize that each person did not provide the same quanta of energy and that there were ways to increase the energy component of the “fuel”.   And so a whole industry grew up around helping organizations and the leaders that ran them improve the energy output of the people (often referred to as increasing motivation and engagement).  And the Organization Development consultants became very popular.

What is interesting about this stage is that rather than seeing the two frameworks, and their contribution to improve performance, as complimentary they were viewed as competing approaches.  There were those who argued that at the end of the day it is all about the bottom-line, that the people side is just about making people feel good.  For them the real power for improving performance is to improve the system and the rest will take care of itself.  Even Deming, the great leader of the quality movement once said that organization improvement is 85% system and 15% people.

Of course the OD side would argue that the real power in improving performance comes from the people, that a highly motivated workforce will outperform the best organized system.  And that an investment in improving the environment, the leadership, the culture is what is really needed.

Even today this battle wages on between the two paradigms, which is really a sad situation.  If you step back and think about it the argument would be like arguing that the engine, transmission and drive shaft are more important than the fuel, or that the fuel is more important than the car mechanics.

In reality you need to understand the contribution of both and know which attributes to apply in which situation.

This is part of what is opening the door to the next stage in how we view organization what I call the Integrative or Spiritual phase.  But more on this in my next post.