1. © 2009 Jones and Bartlett Publishers Chapter 17 Organization Development

2. © 2009 Jones and Bartlett Publishers Organization Development Organization development (OD) is (1) a planned process of change (2) using behavioral science (3) in an organization-wide process (4) utilizing a systematic approach (5) to problem solving with the goal of improving the effectiveness of the organization.

3. © 2009 Jones and Bartlett Publishers Organization Development To achieve the goals of improving organizational effectiveness through process change techniques, OD is: 1.supported by multidisciplinary theories, 2.views organizations as open systems, 3.recognizes that if one part of the organization is impacted by change, an effect will be felt in another part of the organization, 4.based on action research which is a continuous examination of the progress of the interventions, and 5.based on data.

4. © 2009 Jones and Bartlett Publishers The OD Professional The OD professional’s primary responsibility is to facilitate an organization through a change initiative.

5. © 2009 Jones and Bartlett Publishers Planning and Implementing Change StrategicStrategic TechnostructuralTechnostructural Human processHuman process Human resource managementHuman resource management

6. © 2009 Jones and Bartlett Publishers Interventions Team BuildingTeam Building Process ImprovementProcess Improvement Total Quality ManagementTotal Quality Management Work RedesignWork Redesign Structural ChangeStructural Change TrainingTraining Performance Management SystemsPerformance Management Systems

7. © 2009 Jones and Bartlett Publishers Appreciative Inquiry Appreciative Inquiry is designed to be a paradigm shift from the traditional action research model. Appreciative Inquiry suggests that for organizational change to take place, it needs to begin with the viewpoint of its positive attributes, and then ask the questions that will take it in the direction of which it visualizes itself.

8. © 2009 Jones and Bartlett Publishers Chapter 18 Resistance to Change and Change Management

9. © 2009 Jones and Bartlett Publishers Resistance to Change “Change is a very complex phenomenon involving the multiplicity of man’s motivations in both micro and macro systems and that a man gets satisfied with his equilibrium and is resistant to changing his status quo.” “Change is a very complex phenomenon involving the multiplicity of man’s motivations in both micro and macro systems and that a man gets satisfied with his equilibrium and is resistant to changing his status quo.” (Lippitt, 1973)

10. © 2009 Jones and Bartlett Publishers Drivers of Change External / socialExternal / social Industry / taskIndustry / task InternalInternal

11. © 2009 Jones and Bartlett Publishers Drivers of Change

12. © 2009 Jones and Bartlett Publishers Organizational Barriers to Change Lack of change agentLack of change agent Inadequate financial and/or physical resourcesInadequate financial and/or physical resources Poor leadership and resistane to change by senior managementPoor leadership and resistane to change by senior management Lack of th necessary technologyLack of th necessary technology Time restraintsTime restraints Poor market conditionsPoor market conditions

13. © 2009 Jones and Bartlett Publishers Individual Barriers to Change Feelings of uncertainty based on the unknownFeelings of uncertainty based on the unknown Reduction in personal need fulfillmentReduction in personal need fulfillment Real or perceived stressReal or perceived stress Loss of status or “personal comfort zones”Loss of status or “personal comfort zones” Loss of equilibrium and personal powerLoss of equilibrium and personal power

14. © 2009 Jones and Bartlett Publishers Lewin’s Change Model Driving forcesDriving forces Restraining forcesRestraining forces UnfreezeUnfreeze ChangeChange RefreezeRefreeze

15. © 2009 Jones and Bartlett Publishers Kotter’s Eight Steps for Successful Organizational Change 1.Establish a sense of urgency 2.Create a powerful guiding coalition 3.Develop a vision 4.Communicate the vision 5.Empowering others to act on the vision 6.Planning for and creating short-term wins 7.Consolidate improvements and produce more change 8.Institutionalizing new approaches

16. © 2009 Jones and Bartlett Publishers Costs and Benefits of Organizational Change The costs and benefits of making changes within an organization are often difficult to measure.The costs and benefits of making changes within an organization are often difficult to measure. Organizations should make every attempt to evaluate the real savings obtained from a planned change by creating measurable goals.Organizations should make every attempt to evaluate the real savings obtained from a planned change by creating measurable goals. Proposed changes in products, processes and service activities should be quantified, if possible, before the desired modifications are implemented.Proposed changes in products, processes and service activities should be quantified, if possible, before the desired modifications are implemented.

17. © 2009 Jones and Bartlett Publishers Chapter 19 Overview and History of Organizational Theory

18. © 2009 Jones and Bartlett Publishers What is Organizational Theory? 1.Organization theory (OT) is commonly referred to as the study of the behavior and nature of organizations in their environments. 2. Although organization theory emerged from the disciplines of sociology, economics, political science, and psychology, similar to organizational behavior, the focus of OT is the organization as a whole.

19. © 2009 Jones and Bartlett Publishers What is an Organization? An organization is a collection of people working together (i.e., social entity) under a defined structure to achieve predetermined outcomes through coordinated activities (i.e., processes).

20. © 2009 Jones and Bartlett Publishers Organization’s Formal Structure Kast and Rosenzweig (1985, p. 234) defines an organization’s formal structure as: The pattern of formal relationships and duties – the organization chart plus job descriptions.The pattern of formal relationships and duties – the organization chart plus job descriptions. The way in which the various activities or tasks are assigned to different departments and/or people in the organization (differentiation).The way in which the various activities or tasks are assigned to different departments and/or people in the organization (differentiation). The way in which these separate activities or tasks are coordinated (integration).The way in which these separate activities or tasks are coordinated (integration). The power, status, and hierarchical relationships within the organization (authority system).The power, status, and hierarchical relationships within the organization (authority system). The planned and formalized policies, procedures, and controls that guide the activities and relationships of people in the organization (administrative system).The planned and formalized policies, procedures, and controls that guide the activities and relationships of people in the organization (administrative system).

21. © 2009 Jones and Bartlett Publishers Organization Structure The formal structure of a company is reflected by its organization chart which reveals the complexity of the organization.The formal structure of a company is reflected by its organization chart which reveals the complexity of the organization. The more differentiated and diverse the activities (i.e., size, technology, strategies) of the organization - the more integration is required resulting in a more complex structure.The more differentiated and diverse the activities (i.e., size, technology, strategies) of the organization - the more integration is required resulting in a more complex structure.

22. © 2009 Jones and Bartlett Publishers Environmental Forces and the Organization’s Structure The stability/instability and certainty/uncertainty of environmental forces greatly affect an organization’s structure. Questions to be answered: 1.How many forces an organization needs to deal with on a regular basis? 2.How diverse are these forces? 3.How rapidly these forces are changing?

23. © 2009 Jones and Bartlett Publishers History of Organization Theory The historical roots of organization theory can be found in the concepts developed during the Industrial Revolution in the late 19th and early 20th centuries. –Max Weber (1864-1920) –Henry Fayol (1841-1925) –Frederick Taylor (1856-1915)

24. © 2009 Jones and Bartlett Publishers The Six Key Administrative Characteristics of Weber’s “Rational” Organization: 1. Hierarchy of authority – to ensure clear communication of supervision and subordination positions (i.e., designations). 2. Hiring (and promoting) of technically qualified workers - to ensure that hiring and promotions are based on merit rather than favoritism, and those hired view their positions as full-time, primary careers. 3. Consistent system of rules – to ensure consistent and effective pursuit of organizational goals.

25. © 2009 Jones and Bartlett Publishers The Six Key Administrative Characteristics of Weber’s “Rational” Organization: 4. Extensive use of written documents – to ensure that decision are made and communicated through written rules and records. 5. Functional specialization and division of duties – to ensure efficient operations with each worker carrying out specific tasks and duties based on his/her skill and training. 6. Separate position from worker – to ensure that individual workers did not have “rights” to any aspect of his/her position thereby eliminating the ability to pass the position on to friends or family once their contract ends.

26. © 2009 Jones and Bartlett Publishers Henri Fayol (1841-1925) Developed a “set of rules” for managers to follow to be successful.Developed a “set of rules” for managers to follow to be successful. His set of rules consisted of three parts:His set of rules consisted of three parts: (1) Activities of management, (2) Principles of management, and (3) Elements of management.

27. © 2009 Jones and Bartlett Publishers Fayol’s Activities of Management Fayol argued that all activities within organizations could be divided into six main groups: 1. Technical 2. Commercial 3. Financial 4. Security 5. Accounting 6. Managerial

28. © 2009 Jones and Bartlett Publishers Fayol’s Principles of Management

29. © 2009 Jones and Bartlett Publishers Fayol’s Principles of Management (cont’d)

30. © 2009 Jones and Bartlett Publishers Elements of Management: Fayol saw a manager's responsibilities as: 1. Planning 1. Planning 2. Organizing 3. Commanding 4. Coordinating 5. Controlling

31. © 2009 Jones and Bartlett Publishers Taylor’s Four Basic Principles of Management 1. Develop a science for the work of each person. This involves determining how the work can best be performed by experimenting with it, conducting motion and time studies, and often applying mathematical formulas. 2. Scientifically select the best individual for the job, train that person to be able to perform the job better and better, and finally pay higher wages than ever before to reward the increased productivity.

32. © 2009 Jones and Bartlett Publishers Taylor’s Four Basic Principles of Management 3. Cooperate with the workers to ensure that the work is, in fact, done in the prescribed manner; make knowledge of the job (principle 1) and the worker selected (principle 2) come together. This should include, but not be limited to, providing for increased earnings for those who follow the prescribed methods most closely. 4. Divide the work so that activities such as planning, organizing, and controlling are the responsibility of management; the worker, in contrast, has the responsibility for doing. This division is predicated on the assumption that most workers do not have the capability to create the science of their work.

33. © 2009 Jones and Bartlett Publishers Open-System Theory

34. © 2009 Jones and Bartlett Publishers Subsystems of an Open-System Five subsystems were identified by Katz and Kahn (1978) as being important to the success of all organizations. Each of these subsystems may also be comprised of subsystems. 1.Production subsystems are the components that transform inputs into outputs. 2.Maintenance subsystems maintain the social involvement of employees in an organization. 3.Adaptive subsystems serve to gather information about threats and opportunities in the environment and then respond with innovations that allow the organization to adapt.

35. © 2009 Jones and Bartlett Publishers Subsystems of an Open-System 4.Supportive subsystems perform acquisition and distribution functions within an organization. 5 5.Managerial subsystems direct the activities of other subsystems in the organization.

36. © 2009 Jones and Bartlett Publishers End