1. Change Drivers in Organization Development

2. Competition ! Worker Impact lifelong learning adaptability/flexibility
networking
self-loyalty
Change Drivers
environment
globalism
demographics
technology
information
economics
politics
complexity
Organizational Response:
paradigm shift
new psychological contract
decentralizing
downsizing
telecommuting
virtual organization
reengineering
teamwork
Learning Organization
mergers/acquisitions
strategic alliances
target marketing
out-sourcing
temps
innovation
Competition !
Demands
timeliness (JIT)
efficiency
speed
quality
customized
rate of change

3. new psychological contract
They way it used to be…
1- 4 employers
1- 2 careers
42-year working life
lifetime job security
…and now
Of students who declare a major, 70% do not have a high level of confidence in their choice
Of students who have graduated, etc 23% were in jobs unrelated to their majors
6- 10 employers
3- 5 careers
50-year working life
new psychological contract

4. The “old psychological contract”
Employer: I will provide secure employment (unless you really screw up)
Worker: I will provide consistent & loyal work
The “new psychological contract”
Employer: I will provide you with an opportunity to bring value to the organization– and keep you so long as you continue to bring value
Worker: I will stay so long as I am provided what I need & don’t find something better

5. Following WWII, since the US had mobilized its resources and “won” the war, it believed its organizational operations were not simply the best, but the only way to work– why should we change?
Germany & Japan transferred their efforts from a military war machine to an economic war machine
Japan reengineered its economy using Deming’s Quality Management concepts
US continued to use hierarchical, centralized, top-down organizations
US continued to add to its staffing, maintain seniority orientation
…until the disruptive 70s and 80s with the Middle East Oil Embargo, 1987 Stock crash, S&L debacle, increased global competition

7. Creative Destruction: slubber doffers, depaters, & toerags
Job Destruction
Employment Today
Employment Past
Railroad (1920)
Carriage makers (1900)
Telegraph operators (1920)
Cobblers (1900)
Watchmakers (1920)
231,000
<5000
8,000
25,000
2,076,000
109,000
75,000
102,000
101,000
Job Creation
Airline pilots
Medical technicians
Engineers
Computer programmers
Professional athletes
Electricians
232,000
1,380,000
1,850,000
1,290,000
77,000
711,000
38,000
<5,000 (1960)
<5,000 (1920)
51,000 (1900)

8. Environmental change drivers–
limited resources
only .5% of world’s available water is fresh & accessible
54% of available freshwater is currently being used by billion people
half the population lives in unsanitary conditions
since 1950, the amount of irrigated land has tripled
70% of worlds drylands have soil degradation (over cultivated, over-grazed, improperly irrigated, erosion, monoculture, deforestation)
decreased space for trash (200 million tons/day in US); 29 million T of hazardous waste each year
ocean pollution (60 million gallons oil; Mississippi R has 4000 Sq. miles of “dead water” around LA and TX; toxic bacteria levels)
70% of worlds oceans are overexploited (90% reduction in tuna)
global warming & flooding (1-3.5 C by 2100)
decrease in biodiversity (by /3 of all species extinct– EPA)

9. The Technology change driver
What the takes the average person day to do now, took 3 days in 1950, month in 1800, lifetime in 1600
In % of workers were in agriculture (now 3%), in % were in manufacturing (15%), now service & knowledge workers
Moore’s Law: chip capacity double every 6 months while price stays the same
current annual growth rate of Internet is 100%
worldwide: 500m voic boxes, 110m fax machines, 600 users, over 500 million computers worldwide
artificial intelligence is expected to affect 60-90% of jobs, augmenting, displacing or eliminating workers
in the next five years people in the industrial world will be doing jobs differently from the past 50 years
with innovation, “everything goes back to zero”

10. Buy American-Owned Alka Seltzer Alpo Dogfood Aim Toothpaste
Baskin Robbins Icecream
Bactine Antiseptic
Ball Park Franks
Bayer Aspirin
Pic Pens, Lighter, Razor
Burger King
Capitol Records
CBS Records
Chesterfield Cigarettes
Christian Brothers wine
Diamond Stick Matches
Dove Soap
Dunlop Tires
EverReady Batteries
Eureka Vacuum Cleaners
Firestone Tires
Four Roses Whisky
French’s Mustard
Frigidaire Appliances
Friskies & Might Dog food
Glidden Paint
Goodyear Tire & Rubber
Good Humor Icecream
Green Giant Vegetables
Humpty Dumpty Magazine
Hires Root Beer
Hills Brothers Coffee
Hungry Jack Pancakes
Imperial Margerine
Instant Potato Mix
Indian Head Textiles
Jeno’s Pizza
Kelvinator Appliances
Knox Gelatine
Kool Cigarettes
Keebler Cookies
Libby’s Fruits
Lifebuoy Soap
Magnavox
Massey-Ferguson Tractors
Maxell Tapes
Michelin Tires
Mr. Coffee
Norelco Appliances
Nescafe Coffee
New Yorker Hotel
Ovaltine Drink Mix
One-A-Day Vitamins
Panasonic
Pearle Vision Center
Pepsodent Toothpaste
Pillsbury Cake Mix
Nestle Quik Chocolate Mix
Quasar Television
Ray-O-Vac Batteries
Rona Barret’s magazine
Seven Seas Salad Dressing
Shell Oil
Standard Oil
Stouffer Frozen Foods
Tappan Appliances
Valium Tranquilizers
Zig-Zag Cigarette Papers

11. Globalization– the new marketplace
US has 280 million consumers, 330 in EC, ½ billion in China
Of the top 50 world banks, only three US banks hold 13-15th place
20-40% unsuccessful repatriation
Increasing workforce diversification: one LA company conducted orientation in 17 languages
African American purchasing power will increase 55% in each of next two decades
cultural diversity demonstrates many ways to work and manage
Banks: Mizuho, Tokyo-Mitsubishi, Sumitomo, Norinchukin, Sanwa, Sakura– Credit Suisse, Deutsche Bank, BNP Paribas– not in Kansas anymore Toto.

12. Complexity– the number of elements, their interrelationships, and degree of change in either
Revenge effects: the best intended quick solutions often create more or worse problems long term
Forecasting: strategic planning based on the past are probably useless in a turbulent and complex future
Personality: some people are more creative, tolerant of ambiguity & risk, and adaptive to change
Butterfly effect: small changes can have large and unexpected effects
Computer simulations using systems theory are more capable of modeling complex systems
Reengineering: increased role complexity, ambiguity, & overload, multitasking
Constant change, growth, reorganization

13. Unemployment rates– opportunities for relocation
1 billion workers are un- (150m) or underemployed worldwide
by 2010 Asia will account for 60% of the world’s population
US adds about ½ million workers each year

14. The changing workforce
20-30% of the elite skilled workforce changes jobs every year
69% believe it is acceptable to change jobs every 5 years
40% believe that for under age 30 should change jobs every 2-3 years
14% are proud of their company
30% remain loyal
Working Woman identifies 32 desired family-friendly benefits
Increased preference for flex, family and personal time and independence (alt scheduling by 25% employers)
Southwestern Air receives 3,000 online resume a month
Institute of Personnel and Development, April 2000

15. Redundancy elimination
Restructuring
Trimming the fat
Outplacing
Rethinking
Laid Off
Downsizing
Redundancy elimination
Timesizing
Rightsizing
Re-engineering
Workforce reduction
Delayering
Brightsizing

16. Downsizing Change Drivers Mergers & Acquisitions Avoid bankruptcy
Prepare for privatization
Reduce costs to remain competitive
Goals
Reduce expenses (46%)
Increase profits (32%)
Improve cash flow (24%)
Increase productivity (22%)
Increase ROI (21%)
Increase competitive advantage (19%)
Reduce bureaucracy (17%)
Improve decision making (14%)
Increase customer satisfaction (14%)
Increase sales (13%)
Increase market share (12%)
Improve product quality (9%)
Advance technology (9%)
Increase motivation (7%)
Avoid takeover (6%)
Wall Street Journal,

17. Demographic change drivers
60-70% of Boomers plans to work past age (and 20+ hours/week in retirement)
by million will be older than 85
25% of Americans have saved <$5000 for retirement
Generation X may get from 2% to –4% from Social Security
Eurodescendants are declining globally, while Asian, Hispanic & African are increasing (90% of total growth)
by 2020 mental illness will be the world’s most debilitating affliction
People over 50 are fastest growing, have the greatest purchasing power, control half of our disposable income, and 75% of financial assets
by % of Americans will be post-1991 immigrants and their children
32 m Americans speak languages other than English
between people aged will increase 74%

18. Current Marketplace Envisioned Future
Vision: “it’s not just imagining some future picture; it’s seeing and understanding the dynamic forces that shape that place and positioning yourself for the possibilities”
Current Marketplace
Envisioned
Future
Economy
Technology
Demographics
Information
Globalism
Competition
Politics
Environment

19. Growth of the “Knowledge Worker”
“The ability to learn faster than your competitors may be the only sustainable competitive advantage
--Arie de Geus, Head of Planning, Royal Dutch Shell
The weekly edition of the NY Times has more information than a person would come across in a lifetime in 17th Century England
There has been more information produced in the last 30 years than the preceding 5,000
It takes 3-5 years for 50% of worker skills to become obsolete
Japanese students receive 240 days/year compared with 180 US
Japanese workers get 6x the training as US workers (300 hrs/6 mo)
All information doubled about every 5 years; in some fields 6 months
More Americans work in biotechnology than in the entire machine tool industry
About 75% of a product’s cost is determined at the conceptual stage
Developed countries spend 28-30% of GNP on knowledge