1. Organizational Design, Diagnosis, and Development Session 24 Strategic Interventions, I Organization & Environment Relationships

2. Objectives To review organization and environment relationships To understand when the intervention needs to be a strategic one To describe three strategic interventions and demonstrate how organizations respond to and effect environmental relationships.

3. Components of the Environment General Economy Customers Suppliers Competitors Social factors Legal and social factors Technology

4. Environmental Uncertainty Complexity Simple Complex Rate of Change Static Dynamic Low Uncertainty Few factors which remain the same Moderately Low Uncertainty Many factors which remain the same Moderately High Uncertainty Few factors which are in a state of change High Uncertainty Many factors which are in a state of change

5. Environmental Sensitivity Resource Dependence Low High Uncer- tainty Low High Low Sensitivity churches & convenience stores Moderately low Sensitivity child care agencies restaurants Moderately high Sensitivity general manufacturing High Sensitivity Utilities, financial services, pharmaceutical industry

6. Organizational structure Vertical integration Mergers and acquisitions Strategic alliances Managing Environmental Uncertainty

7. Strategic Interventions Open systems planning Integrated strategic change Transorganizational development

8. Open Systems Planning Role of members’ perceptions Implementation process –Environmental assessment –Identify core processes –Create future scenarios (real and ideal) –Compare scenarios to present and create plans for moving towards the future

9. Integrated Strategic Change Perform strategic analysis Exercise strategic choice Design change plan Implement change plan

10. The Fed Ex Example Core competency: Fast delivery, tracking systems The environment: Technology, Competition, Customers The red flags The strategic shift: Competing with the competition, E-commerce, Technology advantage

11. Transorganizational Development Identification stage Convention stage Organization stage Evaluation stage

12. Backwards & Forwards Summing up: Today we considered strategic intervention including open systems planning, integrated strategic change, and transorganizational development. Fed Ex was used as a case in point for strategic change. Looking ahead: Next time we conclude our discussion of strategic interventions with a look at organization transformation. The focus will be on organizational culture and learning