OC 6440Organizational Change and Development

Introduction to Organizational

Change and Development

What is Organizational Development?

• It is the application of social science techniques to plan change in organizational settings for the purpose of enhancing organizational effectiveness and the development of individuals.

Underlying Values

• Concept of people• Concern for science• Democratic principles• The helping relationship

Potential Conflicts with OD

• Conflict with profit making• Conflict with managerial

prerogatives

Organizational Level Diagnosis

Inputs

General Environment

IndustryStructure

Transformation

Strategy

Design Factors

Culture

Outputs

Performance

Productivity

Satisfaction

Group Level Diagnosis

InputsOrganizationDesign Factors

Culture

Strategy

Transformation

Group Design Factors

Outputs

Team Effectiveness

Productivity,Satisfaction

Individual Level Diagnosis

InputsGroupDesign Factors

PersonalCharacterist-ics

Transformation

JobDesign Factors

Outputs

IndividualEffectiveness

Productivity,Satisfaction

After Diagnosis

• Feeding back the information• Choosing interventions• Managing change• Institutionalizing change

Team Building• Improved group

processes• Communication• Goal clarification• Role clarification• Task orientation

Survey Feedback• Small meetings to

feedback survey results

• Meetings used to formulate change

• Managers conduct meetings to indicate commitment

Employee Involvement• Quality of worklife• Quality circles• Total quality

management

Re-Engineering• Job redesign• Teamwork• Work performed by

most appropriate person

• Advanced information technologies used

OD Effectiveness

• More impact on organizational than individual outcomes

• Works better for white collars than blue collars

• Works better if multiple techniques are used

• Technological change shows more positive outcomes

Measurement Problems

• Difficult to isolate cause of outcomes since OD efforts often involve multiple changes

• May be the result of Hawthorne effects

• Change may be due to maturation or passage of time and not intervention

Ethical Issues

• The role of the OD practitioner• Who’s values

Backwards & Forwards• Summing up: We looked at OD values

and how the process operates. We explored major approaches and the difficulties inherent in evaluating interventions

• Looking ahead: We conclude the semester by looking at organizational behavior in a global context

Organizational Change and Development

Polaroid introduced instant photography to the market. They were one of the top 50 companies in the U.S. But they, like many others, were slow to change.What would you have done differently if you were a senior manager at Polaroid?Can you think of any other companies that were too slow to change and suffered the consequences?Why is change so difficult to manage?

Knowledge Objectives1. Describe two major internal pressures for change.2. Identify and explain six major external pressures for

change3. Describe the three-phase model of planned change.4. Discuss important tactical choices involving the speed and

style of a change effort.5. Explain the four general causes of resistance to change

and the tactics that can be used to address each cause.6. Discuss the role of the DADA syndrome in organizational

change.7. Describe the basic organization development (OD) model

and discuss OD interventions, including relationship techniques and structural techniques.

Pressures for Change

Adapted from Exhibit 14-1: Internal and External Pressures for Organizational Change

IntroductionIntroduction or Removal of or Removal of Government Government RegulationsRegulations

Life-CycleLife-Cycle Forces Forces

Growing Growing International International

InterdependenceInterdependence

Changes in Changes in DemographicsDemographics

Shifting Shifting Political Political

DynamicsDynamicsChanges in Changes in

Societal ValuesSocietal Values

Technological Technological AdvancesAdvances

AspirationsAspirations

Pressure for Pressure for ChangeChange

Aspiration-Performance Discrepancies

• Gaps between what an individual, unit, or organization wants to achieve and what it is actually achieving.

• Three important factors in the role of aspirations – Past aspirations– Past performance– Comparison with others

Life-Cycle ForcesNatural and predictable pressures that build as an organization grows and that must be addressed if the organization is to continue to grow.

Integrative Life-Cycle Model

Adapted from Exhibit 14-2: Integrative Life-Cycle Model

EntrepreneurialStage

CollectivityStage

Formalization and Control Stage

ElaborationStage

Need for additional

people

Need for stability and structure

Need for balance

External Pressures for ChangeTechnological advances

Introduction and removal of government regulations

Changes in societal values

Shifting political dynamics

Changes in demographics

Growing international interdependence

ManagerialAdvice

Companies’ Responses to Pressures for “Green” Policies and Practices

Are companies becoming more “green” for reasons other than the “bottom-line”? Give some examples.What is your organization doing to become more “green”? What are you doing personally?Should becoming “green” be a choice or is legislation needed to make it happen?

Planned ChangeA process involving deliberate efforts to move an organization or a unit from its current undesirable state to a new, more desirable state

Awakening

Mobilizing

Reinforcing

Energizing

Envisioning

Enabling

Unfreezing

Moving

Refreezing

Process of Planned Change

Adapted from Exhibit 14-3: Process of Planned Change

Unfreezing RefreezingMoving

• Provide rationale for change

• Create minor levels of guilt/anxiety about not changing

• Create sense of psychological safety concerning change

• Provide information that suspects proposed changes

• Bring about actual shifts in behavior

• Implement new evaluation systems

• Create minor levels of guilt/anxiety about not changing

• Implement new hiring and promotion systems

Kurt Lewin

Sources of Failure

1. Managers and associates should not expect all change activities to occur sequentially.

2. A team of change leaders, rather than a single individual, should guide an organization through a major change effort.

John Kotter

In addition to size, four factors to consider when forming change teams:

Position Power Informal Credibility

Expertise Proven Leadership

Speed of Change

Criteria toConsider

Urgency

Degree of support

Amount and complexity of change

Competitive environment

Knowledge and skills available

Financial and other resources

Style of Change

Participatory – change leaders seek the ideas and advice of associates and then use many of those ideas. Criteria for evaluating the degree to which the participatory style should be used:

Non-participatory – top down, leaders design the change and plan its implementation

UrgencyUrgency Degree ofDegree ofSupportSupport

Referent andReferent andExpert PowerExpert Power

of Leadersof Leaders

Resistance to Change

Four Factors

Lack of Lack of understandingunderstanding

Different Different assessmentsassessments

Self-interestSelf-interest Low tolerance Low tolerance for changefor change

Effort to block new ways of doing things

The DADA syndrome

Denial – ignore possible or current change

Anger – individuals facing unwanted change become angry about the change

Depression – individuals experience emotional lows

Acceptance – individuals embrace the reality of the situation and make the best of it

Organization Development (OD)

• Roots in humanistic psychology• Grounded in values of individual empowerment and

interpersonal cooperation• Fully consistent with the high-involvement management

approach

A planned, organization-wide, continuous process designed to improve communication, problem solving, and learning through the application of behavioral science knowledge

Basic Organization Development Model

Adapted from Exhibit 14-4: Basic Organization Development Model

Diagnosis of Diagnosis of SituationSituation

Introduction of Introduction of interventionsinterventions

Progress Progress MonitoringMonitoring

FeedbackFeedback

Organization Development Interventions

OrganizationDevelopment

Structural TechniquesRelationship Techniques

T-group TrainingTeam Building

Survey Feedback

Job RedesignManagement by Objectives

Supplemental Organizational Processes

Adapted from Exhibit 14-5: Organization Development Interventions

Relationship Techniques

T-group TrainingT-group Training

Team BuildingTeam Building

Survey FeedbackSurvey Feedback

Team Building TipsGet the right people together for a large block of uninterrupted time to work on high-priority problems or opportunities that they have identified and have them work in ways that are structured to enhance the likelihood of realistic solutions and action plans, which are then implemented enthusiastically and followed up to assess actual versus expected results.

Structural TechniquesJob RedesignJob Redesign

Management by Management by Objectives (MBO)Objectives (MBO)

SupplementalSupplementalOrganizationalOrganizational

ProcessesProcesses

Organizational Learning

Exploitative Learning

ExploratoryLearning

Organization Development Across Cultures

EthnocentricAttitude andStereotyping

FlexibilityFlexibility

Knowledge ofKnowledge ofSpecific CulturesSpecific Cultures

InterpersonalInterpersonalSensitivitySensitivity

The Strategic Lens

1. Why do organizations need to make changes on a regular basis? What are the major causes of these changes?

2. Why is it so difficult for people to change their behavior, even when they know it is important to do so?

3. If you were in a managerial position and believed that a major change in your unit’s structure was needed, what actions would you take to ensure that the change was made effectively?