ch 03 (organizational change)
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Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 1 Change and Knowledge Management (2nd Edition)
Chapter
3ORGANIZATIONAL CHANGE
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 2 Change and Knowledge Management (2nd Edition)
Introduction and Definition of Organization Change
“Change or die!” is the rallying cry among today’s Organizations
worldwide.
More and more organizations today face a dynamic and changing environment.
Human resource policies and practices have to change in order to attract and
keep this more diverse workforce. And many companies have to spend large
amounts of money on training to upgrade skills of employees.
In short organizational change is a constant necessity in today’s world which
brings us to the question, exactly what does ‘organizational change’ mean?
Organizational Change can be defined as, “a concerted, planned effort to
increase organizational effectiveness and health through changes in the
organization’s dynamics using behavioral science knowledge.”
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 3 Change and Knowledge Management (2nd Edition)
The Basic Context for Organizational ChangeTo understand the context for an Organization wide change we need to answer three questions regarding organizational Change which are:
1. What Provokes “Organizational Change”?
Usually organizational change is provoked by some major outside driving force, e.g., substantial cuts in funding, address major new markets/clients, need for dramatic increases in productivity/services, etc.
2. Why is Organization-wide Change Difficult to Accomplish?
Many doubt there are effective means to accomplish major organizational change. In fact Organization-wide change often goes against the very values held dear by members in the organization.
3. How is Organization-wide Change Best Carried Out?
Successful change must involve top management, including the board and chief executive. Change is usually best carried out as a team-wide effort.
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SECTION A : Change Management
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Ch:3 ORGANIZATIONAL CHANGE33
3– 4 Change and Knowledge Management (2nd Edition)
Cont….
The Nature of Organizational Change The rapidity of change taking place in the social, political and economic
environments is creating a marked impact on organizations as well as individuals.
Though the change has been coeval with human existence, the pace of change has varied in recent times, most of the development having taken place in the last hundred years. This is likely to accelerate in the new millennium.
Some of the notable changes that have been witnessed, in this decade are:
1. Globalization of markets
2. Technological Changes
3. Political realignments
4. Changing demographics
5. Changing customer preferences
6. Organizational restructuring
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 5 Change and Knowledge Management (2nd Edition)
Cont….
The Principles of Organizational Change
1. Honesty
2. Aims
3. Participation
4. Recognition
5. Team working and Interpersonal relationship
6. Vision of the change
Dimensions of organizational change
Organizational change can seem like such a vague phenomena that it is helpful if you can think of change in terms of various dimensions as:
Organization-wide vs Subsystem Change
Transformational vs Incremental Change
Remedial vs Developmental Change
Unplanned vs Planned Change
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SECTION A : Change Management
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Ch:3 ORGANIZATIONAL CHANGE33
3– 6 Change and Knowledge Management (2nd Edition)
Cont….
The Levels of Organizational Change
Perhaps the most difficult decision to make is at what “level” to start. There are
four levels of organizational change.
Level 1: Shaping and Anticipating the Future
Level 2: Defining Businesses/Core Competencies
Level 3: Reengineering (Structurally Changing)
Level 4: Incrementally Changing
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 7 Change and Knowledge Management (2nd Edition)
Choice of levels
These levels have much of the same goals: increasing customer satisfaction, doing things right the first time, greater employee productivity, etc. Despite these similarities, they differ substantially in the methods they use to achieve these goals.
Goals
Goals also need to be SMART, that is
Specific - concrete action, step by step actions needed to make the goal succeed.
Measurable - observable results from the goal’s accomplishment.
Attainable - The goal is both possible and is done at the right time with sufficient attention and resources.
Realistic- The probability of success is good, given the resources and attention to it.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 8 Change and Knowledge Management (2nd Edition)
Types of Organizational Change
1. Happened Change
2. Reactive Change
3. Anticipatory Change
4. Planned Change
5. Incremental Change
6. Operational Change
7. Strategic Change
8. Directional Change
9. Fundamental Change
10. Total Change
11. Transformational Change
12. Revolutionary Change
13. Recreational Change
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 9 Change and Knowledge Management (2nd Edition)
The Forces of Organizational ChangeOrganizations encounter many different forces for change. These forces come from external sources outside the organization and from internal sources. This section examines the forces that create the need for change. Awareness of these forces can help managers determine when they should consider implementing an organizational change.
External Forces
Demographic Characteristics
Technological Advancements
Market Changes
Social and Political Pressures
Internal Forces
Human Resource Problems
Managerial Behavior and Decisions
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 10 Change and Knowledge Management (2nd Edition)
Cont….
Models of Organizational ChangeKurt Lewin was an American social psychologist. He has contributed to science group dynamics and action research, and he is regarded one of the founders of modern psychology. But Lewin is perhaps best known for developing Force Field Analysis and Force Field Diagrams.
Lewin’s view on Organizations
Change Model 1: Kurt Lewin’s and Friends Three step model
REFREEZE
FREEZE
UNFREEZE
Lewin’s Three stage model
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 11 Change and Knowledge Management (2nd Edition)
Cont….
Change Model 2: Kurt Lewin’s Force Field Analysis
Force Field Diagram
Change Issue
Driving forces Restraining forces
weak
moderate
weak
strong force
Equ
ilib
riu
m
no change change
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Change Model 3: Systems Approach
Transformation
InputsOutputs
Productivity Efficiency
Productivity Activities
Men Materials Machine Methods Money
Systems Theory Approach
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SECTION A : Change Management
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Ch:3 ORGANIZATIONAL CHANGE33
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Change Model 4: Seven Stage Model
Phase 1: Developing a need for change. This phase corresponds to Lewin’s unfreezing phase.
Phase 2: Establishing a change relationship. In this phase a client system in need of help and a change agent from outside the system establish a working relationship.
Phase 3: Clarifying or diagnosing the client system’s problem.
Phase 4: Examining alternative routes and goals; establishing goals and intentions of action.
Phase 5: Transforming intentions into actual change efforts. Phases 3, 4, and 5 correspond — Lewin’s moving phase.
Phase 6: Generalizing and stabilizing change. This phase corresponds to Lewin’s refreezing phase.
Phase 7: Achieving a terminal relationship, that is, terminating the client consultant –relationship.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Change Model 5: ADKAR Model
Awareness – of why the change is needed.
Desire – to support and participate in the change.
Knowledge – of how to change.
Ability – to implement new skills and behaviour.
Reinforcement – to sustain the change.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 15 Change and Knowledge Management (2nd Edition)
Cont….
ADKAR
CHANGE
Knowledge
Rei
nfor
cem
ent
Aw
areness
Ability D
esir
e
ADKAR – A Model for Change Management
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Change Model 6: Action Research
EstablishClient –
ConsultantRelationship
DisengageConsultant's
services
Diagnose theChange
Introduceintervention
Evaluate andstabilizechange
Gather data,Analyze data,
Decideinterventionobjectives
ImplementDesired
Incremental orQuantumChange
Determineeffectiveness
of change andrefreeze new
condition
Action Research Process
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Managerial Options for Managing Change
Three broad approaches, which are popularly used in organizations to
create changes, are listed below. This classification aims to integrate the
findings on change management.
These approaches differ from each other in terms of the assumptions about
people and systems change, the specific strategies used for making the
change successful, and the kind of response they are more likely to
stimulate.
Top-down Approach
Laissez-faire Approach
Collaborative Approach
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Perspectives of Organizational Change
“Perspectives of Organizational Change” gives the individual an insight into
the basic principles that drive change.
They also gain an understanding of the factors that impact on the readiness
and ability of individual to change.
It shows the individual how to deal with the fear that may be generated in a
situation where change is just around the corner.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 19 Change and Knowledge Management (2nd Edition)
Cont….
ContingencyPerspective
PopulationEcology
Perspective
InstitutionalPerspective
ResourceDependencePerspective
PerspectivesOf
OrganizationalChange
Perspectives of Organizational Change
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SECTION A : Change Management
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Ch:3 ORGANIZATIONAL CHANGE33
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Perspective, focus and Issues
Perspective Focus Issues
Contingency perspective
Structure Whether the structure is compatible with external and internal environment of the organization.
Resource dependence perspective
Strategy What strategies should be implemented by the organization to:a) Increase control on the factors affecting due to
environmental changesb) To reduce dependence
Population ecology perspective
Ecological niche a) What is the organizational level of resistance?b) What is the sustainability of niche?c) What are the other niches and domains
dependable with the organizational capabilities?
Institutional Perspective
Norms, values and standards
a) What is the learning from other organizations?b) What kind of changes are to be adopted in order to
comply with the external environmental pressures?c) How can hiring professional help in acquiring the
knowledge for the organization?
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 21 Change and Knowledge Management (2nd Edition)
Cont….
Understanding the Change ProcessThe following steps will help to understand change process:
Preparation Phase
Contact Stage
Awareness Stage
Acceptance Phase
Understanding Stage
Positive Perception Stage
Commitment Phase
Installation Stage
Adoption Stage
Institutionalization stage
Internalization stage
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 22 Change and Knowledge Management (2nd Edition)
Cont….
The Eight step model to transform your organization as suggested by John
P. Kotter from “Leading Change: Why Transformation Efforts fail” is stated
below. The eight steps are:
1. Establish a Sense of Urgency
2. Obtain Management and Peer Backing
3. Create a Vision for Change
4. Communicate the vision
5. Empower Employees to Implement Change
6. Establish Short-term Goals
7. Encourage Additional Changes
8. Reinforce Changes Made as Permanent
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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John P. Kotter’s ‘Eight steps to successful Change’
1. Increase urgency
2. Build the guiding team
3. Get the vision right
4. Communicate for buy-in
5. Empower action
6. Create short-term wins
7. Don’t let up
8. Make change stick
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 24 Change and Knowledge Management (2nd Edition)
Facilitating the ChangeThose involved with change search for a checklist to overcome the problems but there is no one best way to implement change; yet we can learn from the experiences of others. Jick suggests a tentative list of suggestions includes:
Analyze the organization and its need for change
Create a shared vision and common direction
Develop a non-threatening and preferably participative implementation process
Support a strong leader role
Line up political sponsorship
Craft an implementation plan
Develop enabling structures
Communicate, involve people and be honest
Reinforce and institutionalize change
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 25 Change and Knowledge Management (2nd Edition)
Resistance to ChangeDefinition Resistance is an inevitable response to any major change. Individuals
naturally rush to defend the status quo if they feel their security or status are threatened.
Alvin Zander (1950), an early researcher on the subject, defined resistance to change as “behaviour which is intended to protect an individual from the effects of real or imagined change”.
Zaltman & Duncan (1977), define resistance as “any conduct that serves to maintain the status quo in the face of pressure to alter the status quo”.
The Nature of Resistance Active resistance include finding fault, ridiculing, appealing to fear, and
manipulating. Passive resistance symptoms include agreeing verbally but not following
through, feigning ignorance and withholding information.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Levels of Resistance
Resistance to change in organization is found at three levels such as:
1. Individual Resistance
Habit
Security
Economic Factors
Fear of the Unknown
Selective Information Processing
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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2. Organizational Resistance
Power and Conflict
Functional Orientation
Mechanistic Structure
Structural Inertia
Limited Focus of Change
Group Inertia
Threat to Expertise
Threat to Established Power Relationships
Threat to Established Resource Allocations
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SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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3. Group Resistance
Group Norms
Group Cohesiveness
Group Inertia
Groupthink and Escalation of Commitment
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SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Intervention Strategies for Organizational Change
Understanding Organizational Development (OD)
Organization development is an applied field of study and practice. A pair of OD
experts defined organization development as follows:
Organization development is concerned with helping managers plan change
in organizing and managing people that will develop requisite commitment,
coordination, and competence.
Its purpose is to enhance both the effectiveness of organizations and the
well-being of their members through planned interventions in the
organization’s human processes, structures, and systems, using knowledge
of behavioral science and its intervention methods.
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SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Characteristics of the Organizational Development
OD Involves Profound Change
OD is Value Loaded
OD is a Diagnosis/Prescription Cycle
OD is Process Oriented
The following briefly identifies the underlying values in most change
efforts.
1. Respect for people
2. Trust and support
3. Power equalization
4. Confrontation
5. Participation
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Intergroup Development
A major area of concern in change is the dysfunctional conflict that exists
between groups. As a result, this has been a subject to which change efforts
have been directed.
Intergroup development seeks to change the attitudes, stereotypes, and
perceptions that groups have of each other.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Types of Interventions
Various interventions for organization change can be classified into:
1. Structural Interventions
Structural Reorganization
New Reward Systems
Changing Organizational Culture
2. Task Technology Interventions
Appreciative Inquiry
Job Redesign
Socio-technical Systems
Quality of Work Life
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SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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3. People Focused Interventions
Sensitivity Training
Survey Feedback
Process Consultation
Team Building
Intergroup Development
Grid OD
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SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
3– 34 Change and Knowledge Management (2nd Edition)
Cont….
Developing Learning
Organizations
With theoretical foundation
largely provided by Argyris
(double loop leaning) and
Peter Senge (generative
learning) the characteristics of
learning organizations can be
listed as follows:
Characteristicsof Leading
Organizations
Culture ofFacilitating
Change
Presenceof
Tension
SystemsThinking
Characteristics of Learning Organizations
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Why Learning Organisations?
To cope with a changing environment and uncertainty.
To be more flexible and take advantage of opportunities.
To be more innovative.
To make the most of the skills and talents of staff.
In commercial businesses this need is driven by competition - how does it fit
other types of organisation, e.g., NGOs, public sector?
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
How do Organizations learn?
Learning organizations foster an environment wherein people can “create
the results they truly desire,” and where they can learn to learn together for
the betterment of the whole.
Peter Senge is a leading writer in the area of learning organizations, whose
seminal works The Fifth Discipline: The Art and Practice of the Learning
Organization, and the fifth Discipline Field book.
Excel BooksR L Nandeshwar, Balakrishna Jayasimha
SECTION A : Change Management
Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha
Ch:3 ORGANIZATIONAL CHANGE33
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Cont….
Systems Thinking
Team Learning Personal Mastery
Building SharedVisions
Mental Models
Disciplines of Learning Organizations
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The Golden Rules for learning organizations
As an organization which learns and wants its people to learn, it must try to
follow certain concepts in learning techniques and mould itself to accommodate
for a number of specific attributes.
1. Thrive on Change
2. Encourage Experimentation
3. Communicate Success and Failure
4. Facilitate Learning from the Surrounding Environment
5. Facilitate Learning from Employees
6. Reward Learning
7. A Proper Selfishness
8. A Sense of Caring