1. ORGANIZATIONAL DEVELOPMENT
Managing Change

2. Roadmap The context What is organizational change?
Processes for managing change
People and change
Organizational Development
Conflict resolution
Fostering innovation

3. Ghoshal & Bartlett
Old values: compliance, control, contract and constraint
New values: discipline, support, trust and stretch
Successful change involves simplification, integration, and regeneration
Phased approach essential, along with focus on people’s attitudes, assumptions and behaviors
Brings both organizational design and human resources lessons to bear
Ghoshal and Bartlett provide a high-level model for change, let’s look at some of the details and lessons learned at a more granular level

4. What is Organizational Change?
An alteration of an organization’s environment, structure, culture, technology, or people
A constant force
An organizational reality
An opportunity or a threat
Change agent
A person who initiates and assumes the responsibility for managing a change in an organization

5. Basic Questions for Change Agents
What are the forces acting upon me?
What are the pressures I should take into consideration as I decide what to change and how I should change it?
What should we change?
Should the changes be strategic and companywide or relatively limited?
How should we change it?
How should we actually implement the change?

6. Forces for Change External Forces Internal Forces
Competition Laws and regulations
Strategy modifications
New technologies
New equipment
Labor market shifts
New processes
Business cycles
Workforce composition
Social change
Job restructuring
Compensation and benefits
Labor surpluses and shortages
Employee attitude

7. Three Categories of Change
Organizational Culture

8. Model for Planned Organizational Change
Source: Adapted from Larry Short, “Planned Organizational Change,” MSU Business Topics, Autumn 1973, pp. 53–61 ed. Theodore Herbert, Organizational Behavior: Readings and Cases (New York: McMillan, 1976), p. 351.
FIGURE 8–1

9. Two Views of the Change Process
“Calm waters” metaphor
A description of traditional practices in and theories about organizations that likens the organization to a large ship making a predictable trip across a calm sea and experiencing an occasional storm
“White-water rapids” metaphor
A description of the organization as a small raft navigating a raging river

10. Change in “Calm Waters”
Kurt Lewin’s Three-Step Process
Unfreezing
The driving forces, which direct behavior away from the status quo, can be increased
The restraining forces, which hinder movement from the existing equilibrium, can be decreased
The two approaches can be combined
Implementation of change
Refreezing

11. Change in “White-water Rapids”
Change is constant in a dynamic environment
The only certainty is continuing uncertainty
Competitive advantages do not last
Managers must quickly and properly react to unexpected events
Be alert to problems and opportunities
Become change agents in stimulating, implementing and supporting change in the organization

12. Is a New Structure Really Required?
When you identify a problem with your design, first look for ways to fix it without substantially altering it. If that doesn’t work, you’ll have to make fundamental changes or even reject the design. Here’s a step-by-step process for resolving problems.
Source: Adapted from Michael Goold and Andrew Campbell, “Do You Have a Well-Designed Organization?” Harvard Business Review, March 2002, p. 124.
FIGURE 8–2

13. Is a New Structure Really Required? (cont’d)
Source: Adapted from Michael Goold and Andrew Campbell, “Do You Have a Well-Designed Organization?” Harvard Business Review, March 2002, p. 124.
FIGURE 8–2b

14. A Nine-step Process For Leading Organizational Change
Create a Sense of Urgency
Decide What to Change
Create a Guiding Coalition and Mobilize Commitment
Develop and Communicate a Shared Vision
Empower Employees to Make the Change
Generate Short-Term Wins
Consolidate Gains and Produce More Change
Anchor the New Ways of Doing Things in the Company Culture
Monitor Progress and Adjust the Vision as Required

15. Why People Resist Change

16. How Immune Is the Person to Change?
Source: Robert Kegan and Lisa Lahey, “The Real Reason People Won’t Change,” Harvard Business Review, November 2001, p. 89.
FIGURE 8–3

17. Dealing with Change

18. Barriers to Empowerment
Source: Reprinted by permission of Harvard Business School Press. From Leading Change by John P. Kotter. Boston, MA. 1996, p Copyright © 1996 by the President and Fellows of Harvard College, all rights reserved.
FIGURE 8–5

19. Organizational Development
Organizational Development (OD)
An approach to organizational change in which the employees themselves formulate the change that’s required and implement it,
usually with the
aid of a trained
consultant.

20. OD Interventions Human Process Interventions
Aimed at enabling employees to develop a better understanding of their own and others’ behaviors for the purpose of improving that behavior such that the organization benefits.
Sensitivity Training (Laboratory or T-groups)
Purpose is to increase participants’ insight into their own behavior and that of others by encouraging an open expression of feelings in a trainer-guided group.

21. OD Interventions (cont’d)
Team Building
The process of improving the effectiveness of a team through action research or other techniques.
Survey Research
The process of collecting data from attitude surveys filled out by employees of an organization, then feeding the data back to workgroups to provide a basis for problem analysis and action planning.

23. Technostructural Applications of OD
Formal Structure Change Program
An intervention technique in which employees collect information on existing formal organizational structures and analyze it for the purpose of redesigning and implementing
new organizational
structures.

24. Strategic Applications of OD
Strategic Intervention
An OD application aimed at effecting a suitable fit among a firm’s strategy, structure, culture, and external environments.
Integrated Strategic Management
An OD program to create or change a company’s strategy by:
Analyzing the current strategy
Choosing a desired strategy
Designing a strategic change plan
Implementing the new plan.

25. Organizational Stressors: Role Demands
Role conflicts
Work expectations that are hard to satisfy
Role overload
Having more work to accomplish than time permits
Role ambiguity
When role expectations are not clearly understood

26. Conflict Handling Styles
Source: Source: Kenneth W. Thomas, “Organizational Conflict,” ed., Steven Kerr, Organizational Behavior (Columbus, OH: Grid Publishing, 1979), in Andrew DuBrin, Applying Psychology (Upper Saddle River, NJ: Prentice Hall, 2000), p. 223.
FIGURE 8–7

27. Conflict Resolution Modes

28. Stimulating Innovation
Creativity
The ability to combine ideas in a unique way or to make unusual connections
Innovation
The process of taking a creative idea and turning it into a useful product, service, or method of operation
Perception
Incubation
Inspiration

29. Structural Variables Affecting Innovation
Organic structures
Positively influence innovation through less work specialization, fewer rules and decentralization
Easy availability of plentiful resources
Allow management to purchase innovations, bear the cost of instituting innovations, and absorb failures
Frequent inter-unit communication
Helps to break down barriers to innovation by facilitating interaction across departmental lines

30. Next Week Leading– Monday’s topic is “motivation”
Read Chapters 10 and 11 and the assigned articles
Discussion group-- think about the following questions:
Does NASA have clear and consistent leadership?
What are some of the problems with the leadership structure?
How do you think this affects the motivation of the engineers and managers?
Does this have impact on safety & performance?
What could be done to improve the situation?