zeine et al. external adaptability of higher education institutions the use of diagnostic...

Change ManagementAn International Journal

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VOLUME 13 ISSUE 4

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External Adaptability of Higher Education InstitutionsThe Use of Diagnostic Interventions to Improve Agility

RANA ZEINE, CHERYL A. BOGLARSKY, PATRICK BLESSINGER, AND LUKAS MICHEL

CHANGE MANAGEMENT: AN INTERNATIONAL JOURNAL www.ontheorganization.com

First published in 2014 in Champaign, Illinois, USA by Common Ground Publishing LLC www.commongroundpublishing.com

ISSN: 2327-798X

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Change Management: An International Journal

Volume 13, 2014, www.ontheorganization.com, ISSN: 2327-798X

© Common Ground, Rana Zeine, Cheryl A. Boglarsky, Patrick Blessinger, Lukas Michel,

All Rights Reserved. Permissions: [email protected]

External Adaptability of Higher Education

Institutions: The Use of Diagnostic Interventions

to Improve Agility

Rana Zeine, Saint James School of Medicine, USA Cheryl A. Boglarsky, Human Synergistics International, USA

Patrick Blessinger, International Higher Education Teaching and Learning Association, USA Lukas Michel, Sphere Advisors, Switzerland

Abstract: External Adaptability is an outcomes measure of organizational effectiveness reflecting proficiency levels in

responding to external change. Many higher education institutions are interested in reshaping their goals to better meet

the needs of a growing global market. To analyze External Adaptability, 52 higher education faculty and administrators

from institutions in more than 16 countries were surveyed using the Human Synergistics International Organizational

Effectiveness Inventory® (OEI®) Survey. Results revealed that External Adaptability scores fell below both the Historical

Average (50th percentile) and the Constructive Benchmark. Subgroup analysis revealed that scores were below the

Historical Average for faculty, administrators, males, females, and private- and public not-for-profits. By contrast, scores

approached the Historical Average (50th percentile) in private for-profits, and exceeded the Constructive Benchmark in

public for-profits. Trends for slightly higher scores were noted for administrators and males as compared to faculty and

females respectively. To improve agility in higher education institutions, further diagnostic analysis of organizational

decision making is warranted. The Performance Triangle diagnostic model is discussed and the use of the Agilityinsights

Diagnostic™ Survey from Sphere Advisors AG is recommended. Attaining high External Adaptability is critical for the

future of higher education.

Keywords: Organizational Culture, Organizational Effectiveness, Agility, Adaptability, Performance Triangle, Higher

Education, Not-for-profit, For-profit, Management, Leadership

Introduction

Importance of Organizational Adaptability

rivers of permanent volatility include macro-economic fluctuations, technological

innovations, broadening competition, increasing connectivity, changing business

structures and evolving regulations (Dool, 2010). Prosperity in a turbulent environment

depends on the ability to continuously evaluate market conditions, create openness to change,

build and apply knowledge to critical priorities, reexamine and revise organizational strategies,

and deploy and redeploy resources, improve contingency planning and engage in risk assessment

for building organizational resilience (McCann, Selsky, & Lee, 2009) . To compete and attain sustainability in a rapidly changing and globally dynamic environment, organizations must be

agile. Agility provides the ability to respond quickly and effectively to external signs of change

through operational flexibility. In addition to regular scanning of the external environment,

adaptability requires strategic optimization of internal organizational effectiveness (Szumal,

2001). With decentralization and structural complexity, stakes on all decisions are high, and

leaders increasingly rely on people from all levels of their organization for guidance and input on

a wide range of issues. Hence, the external adaptability of an organization is strengthened by

tapping into the full potential of its people, with the aim of assuring good decision making across

all levels (Michel, 2007). Efforts to cope with the challenges of uncertainty and unpredictability

should neither be random nor left to chance, but rather should be supported by rigorous planning

intended to encourage communication, collaboration, confidence, cohesion, knowledge

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CHANGE MANAGEMENT: AN INTERNATIONAL JOURNAL

management and organizational learning which impact performance (Dool, 2010; Nold III,

2012).

Creating Readiness for Change

We and others have previously demonstrated high levels of passive/defensive and

aggressive/defensive cultural styles, and low levels of constructive styles, as compared to ideal,

in higher education institutions (Sanfilippo, Bendapudi, Rucci, & Schlesinger, 2008; Zeine,

Boglarsky, Blessinger, & Hamlet, 2011). Resistance to change is generally high in organizations with rigid leadership hierarchies, poorly aligned structures and systems, and heavily defensive

cultural profiles (Erwin & Garman, 2010). Yet, gaining a competitive advantage depends on the

willingness of organizations to continuously scan the external environment, readily evaluate new

ideas, skillfully deliver change messages and effectively implement strategic change initiatives

(Armenakis & Harris, 2009; Blanchard, 2012; Morrison & Keller, 1992-1993). To create

readiness for change, organizations need to support their members by providing an environment

where people focus on purposeful, value adding, tasks, and share what they know to unlock

creativity and accelerate growth (Jaffe & Scott, 2010; Leppitt, 2006; Nold III, 2011). Two higher

education institutions that have recently conducted notable organization wide transformations are

Lincoln University in New Zealand and Ohio State University Medical Center in the United

States (Morrison, Sargison, & Francis, 1997; Sanfilippo et al., 2008). After scanning the external environmental and diagnosing organizational culture and outcomes, leadership teams launched

change initiatives that included efforts to add new courses/services, develop new programs,

introduce constructive cultural styles, redefine supervisory/managerial leadership interactions,

improve decision making processes and embrace technological advancements, ultimately

increasing student/client satisfaction, employee job satisfaction and financial performance

(Morrison et al., 1997; Sanfilippo et al., 2008).

Agility as a Measure of Effectiveness

The cognitive and emotional stresses associated with serial change can lead to organizational

fatigue referred to as enervative change (Dool, 2010). The challenge, therefore, is for leaders to envision an institutional framework in which decision making at the level of individuals is

harmonized with decision making at scale, allowing for integration of rapid adaptive adjustments

(Michel, 2007). Agility is the “capacity to be consistently adaptable without having to change”,

and reflects the efficiency with which an organization responds to new situations without

requiring changes in overall approach (Haneberg, 2011, pp. 51,52). Agile systems are believed to

be stable and reliable (Hugos, 2006). In evaluating organizational effectiveness, one of the

outcomes measures that can be assessed is agility, or External Adaptability, which refers to the

extent to which an organization recognizes and responds to changes in its external environment

(Cooke & Szumal, 2000; Szumal, 2001). In this study, we evaluate the External Adaptability

needs of for-profit and not-for-profit higher education institutions using the Human Synergistics

International Organizational Effectiveness Inventory® survey (OEI®) (Szumal, 2001), and we discuss the findings in light of the Sphere Advisors AG Performance Triangle and AgilityINsights

Diagnostic™ model for improving organizational agility (Michel, 2012).

Methods

Higher Education faculty and administrators from institutions located in 16 countries in North

America, Europe, India, Australia, Latin America, Africa and the Middle East participated in the

Human Synergistics (http://www.humansynergistics.com/) Organizational Effectiveness

Inventory survey (OEI®, web-based version). The OEI®

assesses multiple factors relevant to

articulation of mission, focus, operational systems, structures and skills; and multiple outcomes

2

ZEINE ET AL.: EXTERNAL ADAPTABILITY OF HIGHER EDUCATION INSTITUTIONS

measures relevant to individual, departmental and organizational performance including External

Adaptability (Cooke & Szumal, 2000; Szumal, 2001). Selected data from this study including

demographics and results on External Adaptability are presented and analyzed in this paper. The

mean scores and standard errors were calculated and plotted for total respondents (n=52) and for

8 subgroups: female (n=25), male (n=26), faculty (n=25), administrators (n=20), for-profit-public

(n=4), for-profit-private (n=10), not-for-profit-public (n=30) and not-for-profit-private (n=8)

(Figure 1). OEI® results were compared to the Historical Average (50th percentile) taken as the

median of OEI® responses of members from 1084 organizational units, and to Constructive

Benchmarks, based on the median of OEI® results derived from 172 organizational units with

predominantly Constructive cultures. With the Constructive Benchmark exceeding the Historical Average, External Adaptability scores falling below the Historical Average were considered

undesirable.

Results

Demographics of Respondents

The 52 respondents were affiliated with Higher Education Institutions in the United States (23),

India (4), United Kingdom (3), France (2), Australia (2), Canada, Wales, Spain, Denmark,

Greece, Macedonia, New Zealand, Ethiopia, Egypt, Jordan, Costa Rica and other countries. The

institutions included Doctorate-granting universities (56%), Master’s colleges / universities

(19%), Bachelor’s colleges (13%), Associate’s colleges (6%), Special Focus (2%) and other

institutions (4%). Four types of institutions were represented, 30 public not-for-profits, 10 private

for-profits, 8 private not-for-profits and 4 public for-profits. Participants included 26 males and 25 females. More than 21% belonged to the ≥60 years

age group, 56% were in the 40-59 years age bracket, and 17% were less than 39 years old. Their

professional roles in higher education included faculty/professor (48%), director (19%), associate

dean (6%), department chair (4%), dean (4%), provost/dean academic affairs (4%), president

(2%) and undetermined (13%). The majority had spent more than 4 years at their organization as

shown in the distribution chart in Figure 1.

3


Figure 1. Percentage distribution of number of years spent by respondents at their present higher education institution.

External Adaptability of Higher Education Institutions is Undesirable

Scores for External Adaptability were below both the Historical Average (50th percentile, 3.50)

and the Constructive Benchmark (3.83) for total respondents (mean 3.27 ± 0.15 SE) as shown in

Figure 2. Subgroup analysis revealed scores below the Historical Average for faculty,

administrators, males, females, and private- and public not-for-profits (Figure 2). By contrast, scores for private for-profits (3.47 ± 0.39) approached the Historical Average, and those for

public for-profit (4.42 ± 0.58) were markedly above the Constructive Benchmark (Figure 2).

Although differences between subgroups did not reach statistical significance, trends for lower

scores were noted for females (3.19 ± 0.22), faculty (3.17 ± 0.22) and not-for-profits (private

3.04 ± 0.41, public 3.11 ± 0.16), as compared to males (3.36 ± 0.21), administrators (3.40 ± 0.25)

and for-profits respectively (Figure 2).

< 6 mo, 4% 6 mo to 1 yr,

6%

1 to 2 yrs,

6%

2 to 4 yrs,

19%

4 to 6 yrs,

23%

6 to 10 yrs,

19%

10 to 15 yrs,

6%

>15 yrs,

15%

nd, 2% Figure 1

4


Figure 2. External Adaptability of Higher Education Institutions. OEI®

Mean score ± standard error (SE) for total

respondents, and for female, male, faculty, administrator, public for-profit, private for-profit, public not-for-profit and

private not-for-profit subgroups compared to the Historical Average and the Constructive Benchmark.

Discussion

In this study, we probed higher education professionals regarding the extent to which their

institutions proactively identify and adjust to change, effectively respond to external

opportunities and threats, and rapidly implement new programs. Our results showed that the

External Adaptability of higher education institutions is less than optimal. This is consistent with

our findings that the operating culture and other causal factors, including certain systems,

structures and skills, were also less positive than corresponding benchmarks (Human-

Synergistics, 2012; Zeine et al., 2011; R. Zeine et al., 2014; Rana Zeine et al., 2014). To improve measures of external adaptability, a deeper understanding of the determinants of agility, at all

levels of an organization, is needed.

Determinants of Organizational Agility

In a nine-year longitudinal study of organizations, Collins and Hansen analyzed leadership

characteristics in firms that excel despite uncertainty, chaos, and luck (Collins & Hansen, 2011).

They demonstrated that, contrary to popular belief, the best leaders were not more risk seeking

than others, and that these firms were neither more innovative nor faster in their decision-making

than others (Collins, 2012; Collins & Hansen, 2011). They approached uncertainty, turmoil and disruptive change with “a mix of creativity, discipline and paranoia” which enabled them to

“recognize changes and threats early, then make rigorous decisions and take disciplined action”

(Collins, 2012, p. 4). Rather than reacting instantaneously to episodes of chaos, they watched

events unfold and made deliberate preparations, scaled innovation throughout their organizations,

and changed less in reaction to their evolving world as compared to others (Collins & Hansen,

2011).

0 1 2 3 4 5

Female

Male

Faculty

Administrators

For-profit, Public

For-profit, Private

Not-for-profit, Public

Not-for-profit, Private

Total

Historical Average

Median, 50th

percentile

Constructive

n = 52

n = 30 n = 10

n = 4n = 20 n = 25

n = 25 n = 26

n = 8

Mean Score ±

SE

5


The need for fast and effective decision-making, effective knowledge management, and

innovation are recurring themes throughout the literature on corporate agility, adaptability, and

change. Five issues that have been identified as “paramount” for success in “a world of relentless

change, ferocious competition, and unstoppable innovation” are values, innovation, adaptability,

passion and ideology; whereby, innovation is at the core of an agile organization (Hamel, 2012a,

p. 4; 2012b). Strategic flexibility is key, especially in the reconfiguration of multinational

corporations, whereby, the decision-making processes determine the level of attainable agility

and mold the ‘flexible footprints’ of each adapting organization (Maitland & Sammartino, 2012).

Nature of Higher Education Institutions

In an analysis of business continuity plans of 20 U.S. universities, arrangement in three domains

were found to be important when facing disruptive change: (1) effective configuration of

information technology systems including the establishment of communication protocols, (2)

adequate faculty readiness, and (3) adequate student readiness (Ekmekci & Bergstrand, 2010).

Institutions with the ability to “remain agile throughout the duration of a given change initiative”

maintain a high capacity to adjust both “the speed and the direction of change efforts” (Ekmekci

& Bergstrand, 2010, p. 26). Institutions with deficiencies in adjusting speed make “frequent

changes in direction” resulting in a “volatile trajectory”, while those with deficiencies in

adjusting direction often miss their targets by “following a projectile trajectory”, and institutions that “can neither alter speed nor direction” become “docile” and unable to compete (Ekmekci &

Bergstrand, 2010, pp. 26-27). Efforts to improve External Adaptability may be hampered by the

“institutional resistance” that characterizes higher education institutions (Macfadyen & Dawson,

2012; Tagg, 2012). Yet, our results indicate that there is awareness among faculty and

administrators, males and females, that their institutions are not optimally adaptive, which could

be interpreted as a sign of readiness to explore new ideas (Figure 2). Achieving higher agility

requires the adoption of leadership styles and managerial systems that optimize the integration of

good decision-making by the people who have the specific knowledge and expertise relevant to

any particular issue or circumstance.

The Performance Triangle

The Performance Triangle is a conceptual model of agility composed of three primary elements:

Systems, Leadership, and Culture (Michel, 2013). Because decisions are made by people, the

Performance Triangle places People at the center of the model (Figure 3).

6


Figure 3. Performance Triangle. Adapted from “The Performance Triangle: A diagnostic tool to help leaders translate

knowledge into action for higher agility” p.8. By Michel, 2013. Copyright 2013 by AgilityINsights Diagnostic™.

The Performance Triangle frames the requirements for higher agility and speed as measures

of organizational success. People power the system by contributing their unique skills, expertise,

and experience. Determinants of superior decision making include (a) the awareness to sense

early warning signs of changes in the internal or external environment, (b) the skill to identify

and distill relevant information, and (c) the readiness to react quickly in order to have an impact

on outcomes. For an organization to harness the energy and capacity of its people, it must find

ways to ensure that all members are given the opportunity to work to their fullest potential. Agile

organizations aim to facilitate self-determination, self-control, self-initiative, and responsibility

rather than applying rigid, inflexible, and slow-reacting command-and-control mechanisms of

governance. Collective success is made possible through communication, collaboration and

relationship building within and throughout the organization. The Performance Triangle

illustrates an organizational design and philosophy that connect the knowledge and talents of the people who are needed to make effective and timely decisions within an organization (Figure 3).

It has been proposed that coaching can empower individuals to perform at their highest

potential by winning at their “inner game” and overcoming their self-doubt, fear, biased-focus,

limiting concepts or assumptions that distort perceptions, decisions, behaviors, actions and stress

that interfere with, and diminish, performance (Gallwey, 2000; Whitmore & Gallwey, 2010).

Indeed, there is an infinite array of personal and organizational conditions that can degrade

communication and, ultimately, interfere with the decision-making process. Awareness, choice,

and trust help people to focus their attention on what matters. Desired focus is attainable in

environments where individuals, and the collective, develop sharpened awareness and keen

abilities that allow them to compensate for distractions and noise (Gallwey, 2000). Reaching a

state of flow, the state where performance and creativity are at a peak, must be a primary objective at all levels of an agile organization (Csikszentmihalyi, 1997). Control systems are

needed to manage both evolutionary and revolutionary change by formalizing beliefs, setting

boundaries on acceptable strategic behavior, defining and monitoring performance variables,

encouraging debate and discussion about uncertainties, communicating new strategies,

Figure 3

7


establishing targets, and securing attention to new strategic initiatives (Simons, 1994). In facing

the unknown, effective responses necessarily require novel, creative and untried ideas. An

organization’s ability to respond becomes a function of the ingenuity of its people, the ability of

the organization to harness that ingenuity, and the available resources. In support of this, leaders

need to design frameworks for interaction, and systems with rules, routines and tools that enable

people to relate, collaborate, and focus on a common purpose (Figure 4).

Figure 4. Organizational Relationships to Achieve Flow and Enable The Inner Game. Adapted from “The Performance

Triangle: A diagnostic tool to help leaders translate knowledge into action for higher agility” p.16. By Michel, 2013.

Copyright 2013 by AgilityINsights Diagnostic™.

At the top of the Performance Triangle is Success, representing the ultimate purpose of

management (Figure 3). Organizational Culture creates shared context, enables or inhibits

knowledge transfer, and defines the boundaries of collaboration (Bolman & Deal, 1991; Ruggles,

1998). The organizational culture, leadership styles, structures, and reward systems provide a

social context for knowledge creation which either enables or constrains relationships and

interactions (Nonaka & von Krogh, 2009). Indeed, organizational culture can constitute a bottle-

neck that limits knowledge sharing, creativity, and success. In the broadest sense, leadership is

embodied by effective communication and interaction with others at all levels throughout the

organization. In the Performance Triangle, systems represent the institutional framework with

rules, routines, and tools that set the stage for rigorous and disciplined leadership (Figure 3). Through time, operating cultures unintentionally deviate from ideal cultures in many

organization including higher education institutions (Sanfilippo et al., 2008; Zeine et al., 2011).

When this happens, senses are likely to be numb, mistrust prevails, and tight rules prevent people

from capturing opportunities. As such, people face an adverse “outer game” – external challenges

beyond their abilities. Challenged by both, the inner and outer games, performance is

compromised and people are unable to work at their full potential (Gallwey, 2000; Somers,

2009).

Recommendations

Need for Investigating Agility in Higher Education Institutions

We recommend that Higher Education institutions undergo diagnostic evaluations and in-depth-

analysis of their current organizational agility. This could be accomplished either as part of a

general needs assessment for organizational culture or organizational effectiveness, or as a separate study that is purely focused on determinants of organizational agility. Insight gained

could establish a starting point for constructive dialogue, and could guide future strategic

planning. The AgilityINsights Diagnostic™ is a comprehensive assessment tool that analyzes an

organization’s capability to adapt in an ever-changing external environment

(http://www.agilityinsights.com/). It generates scores for an array of managerial and leadership

parameters and has been developed over a 15-year period. High scores suggest desirable levels of

Figure 4

8


productive conversations with employees on direction, performance, beliefs, and boundaries.

Interpretation of results is based on data collected from 50 organizations demonstrating the

existence of meaningful and statistically significant relationships between culture, leadership,

systems, and success (Table 1, p-values < 0.05).

Table 1: Relationships between Organizational Culture, Leadership, Systems and Success

identified by the Agilityinsights Diagnostic™ Performance Triangle model.

Relationships, n = 50 α, intersection β, slope Correlation coefficient

Leadership – culture 26 0.61 0.55

Systems – culture 24 0.66 0.56

Systems – leadership 20 0.73 0.69

Culture – success 45 0.42 0.52

The strongest positive correlation identified is between systems and leadership (r=0.69). The

1:1 relationship between culture and systems indicates that organizations with superior systems

are likely to have a productive culture. Every system is a bureaucratic intervention. Systems are necessary to support effective management and leadership and to help establish and maintain a

healthy culture. Small changes in systems have a significant effect on leadership, and there is no

leadership without systems (low intersection point). The challenge for any organization is to

create a positive environment that encourages people to work together to share what they know

and collaborate effectively. A productive culture increases the probability of success. Nold

(2012) showed that firms with higher levels of credibility, fairness, respect (collectively trust),

pride, and camaraderie significantly outperformed comparable firms in the same industries in

value creation, operational performance, and growth rate.

Conclusion

Higher education institutions can explore strategies to increase the speed and quality of decision-making with a view to improving their External Adaptability. Agility is an essential capability

when coping with volatility and uncertainty. The Performance Triangle is a diagnostic model

and philosophy that combines culture, leadership, and systems to maximize flow and

performance in ways that would enhance organizational agility. The starting point for

implementing the Performance Triangle concepts is to diagnose the current operational state in

order to identify gaps between what executives think is going on and what is actually happening.

This process requires deep introspective and meaningful dialogue to understand the patterns of

behavior and the attributes that currently exist within an organization. Asking difficult questions

to stimulate critical thinking and honest evaluation becomes a key first step in the process. Real

solutions that are effective, timely, and long-lasting, result from self-mentoring as an outcome of

exploring people-centric aspects of the organization.

9


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Considerate Leadership as a measure of Effectiveness in Medical and Higher Education:

Analysis of supervisory/managerial leadership. Organizational Cultures: An

International Journal, 2014.

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ABOUT THE AUTHORS

Dr. Rana Zeine: Saint James School of Medicine, USA

Dr. Cheryl A. Boglarsky: Human Synergistics International, USA

Patrick Blessinger: International Higher Education Teaching and Learning Association, USA

Lukas Michel: CEO & Partner, Owner, Founder and MD, Sphere Advisors, Switzerland

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Change Management: An International Journal is one of four thematically focused journals in the collection of journals that support The Organization knowledge community—its journals, book series, conference and online community.

The journal investigates the dynamics of negotiating organizational change, and organizational responses to social, stakeholder and market change.

As well as papers of a traditional scholarly type, this journal invites case studies that take the form of presentations of management practice—including documentation of organizational practices and exegeses analyzing the effects of those practices.

Change Management: An International Journal is a peer-reviewed scholarly journal.

ISSN 2327-798X