This Document Contains Chapters 3 to 4 Chapter 3 Changing the Culture Learning Objectives 1. Recognize the importance of corporate culture to organizational success. 2. Identify the key factors used in assessing corporate culture. 3. Describe the culture and organizational factors that lead to effective organizations. 4. Describe the major ethical, value, and goal considerations of an OD program. Student Premeeting Preparation 1. Read Chapter 3. 2. Prepare and read the instructions for OD Skills Simulation 3.1. Prior to class, form into teams of six and select roles. Complete Step 1. 3. Read and analyze Case: The Dim Lighting Co. Instructor Preparation and Materials 1. Simulations: No special materials are required though you may want to duplicate the answers for Simulation 3.1. The answers are in the Simulation Procedures section of this manual. LECTURE OUTLINE 1) Learning objectives. (pg. 62) a) Recognize the importance of corporate culture to organizational success. b) Identify the key factors used in assessing corporate culture. c) Describe the culture and organizational factors that lead to effective organizations. d) Describe the major ethical, value, and goal considerations of an OD program. 2) Creating a climate for change. (pg. 62) a) An issue facing managers and organizations is how to manage large-scale change. b) As change is inevitable, the challenge of managers is to: i) Create a renewing rather than a reactive managerial system. ii) Develop long-term efforts. c) Companies with outstanding financial performance often have powerful corporate cultures. i) Culture is often the key to an organization’s success. ii) Cultural change does not just happen in an organization. It is usually the result of a complex change strategy. 3) Understanding corporate culture. (pg. 62) a) Given an environment of rapid change, a static organizational culture can no longer be effective. b) What is corporate culture? i) A culture is a system of shared values (what is important); beliefs (how things work); and behavioral norms (how things are done here). (1) Observed behavioral norms. (2) Dominant values. (3) “Rules of the game” - getting along. (4) Learning the ropes for newcomers. (5) The climate, both physical and treatment of outsiders. ii) Culture is derived from two subsystems, managerial and organizational. (See Figure 3.1, Culture Formation) (1) Managerial. (a) Through their actions and words, management defines a philosophy of how employees are treated. (b) A vision is usually articulated by top management. (2) Organizational. (a) Factors brought in by the organization also help define the culture. (b) Technology a company utilizes will influence the culture. (c) Job descriptions and the structure of an organization (tall versus flat) influence the culture’s development c) The corporate culture and success. i) High-performing companies have strong cultures. ii) Many corporate cultures fail to adapt to change and therefore fail as economic entities. iii) Following corporate mergers, cultures often clash. d) Key factors that can improve a culture. i) Create a vision for the future. ii) Develop a model for change. iii) Reward changes. 4) Cultural resistance to change. (pg. 67) a) Changing a culture is not easy. b) Time is required because culture comes from shared behaviors and working relationships. c) A culture can prevent a company from adapting to a changing environment (example Levi Strauss & Co.) d) Some things bringing pressure on companies to be adaptable. i) Recession. ii) Deregulation. iii) Technological upheavals. iv) Social factors. v) Global competition. vi) Outsourcing. vii) Markets. 5) Tools for change in an adaptive organization. (pg. 67) a) Information. i) Provide people with information or the ability to gather information. ii) One method of providing information is open-book management. (1) Key information is given to employees so that work teams can make job decisions. (2) Employees learn to understand accounting and financial statements and use that knowledge in their work and planning. b) Support. i) If the project will cut across organizational lines, support and collaboration from other departments is needed. ii) Higher management’s support is required to provide a climate that supports people in taking risks. c) Resources. i) Includes funds, staff, equipment, and materials, to carry out the project. ii) Some companies have innovative programs for providing resources including: (1) Venture capital. (2) Innovation banks. d) Key factors in cultural change. i) Understand old culture: Managers can’t change their course until they know where they are. ii) Follow outstanding units: Recognize exemplary units and use them as a model for change. iii) Encourage change in employees: Encourage employees to change and improve the current culture. iv) Involve employees: Avoid imposing cultural change and instead involve employees in discovering new ways of operating. v) Lead with a vision: The vision provides a guiding principle for change, but must be bought into by employees. vi) Recognize that large-scale change takes time: It may take three to five years for significant, organization-wide cultural change to take effect. vii) Live the new culture: The actions of managers carry more impact than their words. 6) Ethical, value, and goal considerations. (pg. 69) a) There are three basic organizational dimensions that affect performance. i) Managerial effectiveness. (1) Accomplishment of specific organizational goals and objectives. (2) Doing the right thing. ii) Managerial efficiency. (1) The ratio of output (results) to input (resources). (2) Doing the things right. iii) Motivational climate. (1) The set of employee attitudes and morale that influence the level of performance. b) Three other criteria for organizational effectiveness. i) Adaptability. ii) Sense of identity. iii) Capacity to test reality. c) Ethical and value issues. i) Expertise - specialized knowledge and skills. ii) Autonomy - the right to decide how their function is to be performed and to be free from restrictions. iii) Commitment - feel a commitment to the discipline. iv) Code of ethics - adhere to professional self-discipline and a code of ethics. d) OD implementation issues. i) The success of an OD program is largely dependent upon the fit between OD values and the organization’s values. ii) A key issue to resolve between the practitioner and the client is the value orientations, including beliefs about people, methods used to reach change, and the purpose of the change program. e) Compatibility of values. i) The degree to which the practitioner’s personal values are congruent with those of the client. ii) Some OD practitioners believe that their personal values should be compatible to those of the client. iii) Others believe that as long as the organization’s operations are legal, they have no problem in helping the client. iv) Some practitioners offer assistance only to those clients who can pay while others help a client regardless of the ability to pay. f) Imposed change. i) OD ideally is implemented voluntarily in organizations. ii) Top management may initiate a program and impose it upon lower levels. iii) OD practitioners need to be cognizant of the reality of power and politics in implementing change. g) Determining the priority of the goals. i) Which of the goals of an OD program is likely to be given precedence. ii) A challenge for the OD practitioner is to try to develop a balanced intervention. (1) One that considers member rights and well-being along with improvements in productivity. (2) How can the OD practitioner help improve the productive efficiency of the organization and at the same time improve the quality of work for its members. iii) OD values about the nature of human beings in an organization underlie the challenges of OD. (See Table 3.1, OD Values) (1) Respect for people. (2) Trust and support. (3) Power equalization. (4) Confrontation. (5) Participation. OD Applications The Culture at Setpoint Systems (p. 63) SUMMARY Setpoint’s products and attention to customers requires a culture where self-motivated employees solve unique problems and have a thorough understanding of the business. MAJOR POINTS • Setpoint builds automation equipment that is unique to fill specific customer requirements • This requires self-motivated employees who can solve problems and look for ways to improve processes and functions. • To accomplish this Setpoint uses project management and open-book accounting. • People on the production floor using these techniques understand the business and know where to focus attention. • The culture of Setpoint is one where employees understand the business and provide a thorough attention to the financials. QUESTIONS 1. Is it reasonable to expect other manufacturing companies to be able to duplicate the culture that Setpoint has developed? Support your position. Answer: Other manufacturers that provide one-of-a-kind products to meet specific customer requirements will need a similar culture to that of Setpoint. This culture and the specific methods cannot duplicate that of Setpoint but it will need to incorporate conditions that encourage and develop highly self-motivated employees that are able to solve problems and implement solutions. 2. Can culture be bought? Answer: It is challenging for a company through a merger/but-out process to obtain the culture of another company. The unique climate that helps make Setpoint successful will require a considerable amount of work to transfer over to another company. Cultures are unique and defy a “cookie-cutter” approach. 3. What dangers would a merger pose for the culture at Setpoint? Answer: A significant problem is that Setpoint’s culture could be overwhelmed by another culture. There is a tendency for another company to be intimidated or challenged by the culture of Setpoint and hence try to change Setpoint to become more like itself. How Trilogy’s University Helps Build Its Culture (p. 68) SUMMARY Trilogy fosters new methods in the way it relates with its clients and employees. The company offers advantages of belonging to an organization in which mutual commitment builds continuity. MAJOR POINTS • Though Trilogy is privately held, it successfully competes with some of the largest software companies within its market • To do this Trilogy is aware that one of their key responsibilities is to attract and retain talented people • Trilogy operates a three-month long “boot camp” where new employees are integrated into the company. • Employees learn the values and culture of Trilogy and receive comprehensive evaluation and feedback. • The program provides a critical source for renewal by providing new services and products to the company. • In the boot camp, relationships are formed and new leaders are created. QUESTIONS 1. Do you think the practices of Trilogy will help it remain competitive? Why? Answer: Yes, Trilogy's practices can help it remain competitive if they focus on innovation, customer satisfaction, and adapting to market trends. Staying agile and responsive to customer needs, while integrating new technologies and methodologies, will strengthen its market position and drive growth. 2. How does Trilogy transfer its culture to new employees? Answer: The three-month boot camp is the primary method to integrate new employees into Trilogy. The program sets the tone for future relationships within the company. During the first month, candidates are in teams of approximately 20 where they work on creative projects. In the second month, the teams are broken into smaller teams where they develop a business model, marketing plans, and a prototype for a new product/service. In the third month, the candidate demonstrates personal initiative by working on their project either with their team or finding a sponsor somewhere in the company. The boot camp importantly serves as a source for research and development as well as a major source for self-renewal and transformation. 3. What other companies would you consider to be “enterprises of the future?” Answer: Companies like Tesla, Amazon, and Google are often considered "enterprises of the future" due to their innovation in technology, data-driven decision-making, and adaptability. Their focus on sustainability, automation, and AI positions them at the forefront of future business trends. Review Questions 1. Describe or compare the corporate cultures of organizations you have worked in. What makes one more effective than another? Answer: In different organizations I've encountered, corporate cultures vary widely. A collaborative culture, emphasizing open communication and teamwork, often fosters innovation and employee satisfaction. In contrast, a hierarchical culture with rigid structures can lead to clear directives but may stifle creativity. An effective culture usually balances flexibility with clear goals, encouraging both individual initiative and team collaboration. 2. Compare and contrast managerial efficiency and effectiveness. Answer: Efficiency is aimed at short-term goals such as productivity and profitability in making the most efficient use of resources. Effectiveness refers to those actions aimed at furthering the organization’s long-term goals. In excellent organizations members are working toward both, but in some organizations short-term goals or efficiency is overemphasized at the expense of longer-range results. For example, a firm might look more profitable by cutting its research staff and advertising budget, but in the long term, the company will lose to more farsighted competitors. 3. Identify the key factors in cultural change. Answer: 1. Create a vision for the future. A shared vision provides direction, focus, and commitment. Some very successful organizations began with a vision. This includes companies like Apple Computer and Federal Express. These visions are compelling and involve all members in striving toward goals. 2. Develop a model for change. Total organization change often starts in one unit or subculture of an organization. This model provides the example that can be transferred to other units. 3. Reward changes. A basic concept of motivation is that people tend to behave in ways that provide rewards or reinforcement. If the system still rewards the old culture, then it won’t make sense for people to change. Rewards include not only pay and promotion, but also other incentives. 4. Explain the role of tools for change in an OD program. Answer: Information is an important tool as people need information or the ability to gather information. One method of providing information is open-book management. This is a method of providing detailed accounting and financial information so that employees can use the knowledge in their work. Another tool is to provide support to people. This is particularly important if the project will cut across organizational lines. Support and collaboration from other departments is needed. Higher management’s support is also required to provide a climate that supports people in taking risks. Providing resources is a third tool required in an adaptive organization. This includes funds, staff, equipment, and materials, to carry out the project. Some companies have innovative programs for providing resources including venture capital and innovation banks. KEY WORDS AND CONCEPTS Define and be able to use the following words and concepts: Corporate culture - a system of shared values and beliefs that interact with people, structure, and systems of an organization to produce norms. (p. 63) Managerial effectiveness - ability to accomplish specific organizational goals or objectives; “doing the right thing.” (p. 69) Managerial efficiency - the ratio of output (results) to input (resources), or “doing things right.” (p. 69) Motivational climate - employee attitudes and morals that influence the performance level. (p. 69) Open-book-management - teach employees to understand accounting and financial statements and to use the knowledge in their work and planning. (p. 67) Professionalism - internalization of value system that is part of the concept of the profession. (p. 70) ADDITIONAL RESOURCES Readings: Berman, Karen and Joe Knight, Financial Intelligence: A Manager’s Guide to Knowing What the Numbers Really Mean (Boston: Harvard Business School Press, 2006.) Burrough, Bryan and John Helyar, Barbarians at the Gate: The Fall of RJR Nabisco, (New York: Harper & Row, 1990.) Also, HBO movie with James Gamer. Gittell, Jody Hoffer, The Southwest Airlines Way, (New York: McGraw Hill, 2003.) Sisodia, Rajendra S., David B. Wolfe, Jagdish N. Sheth, Firms of Endearment: How World-Class Companies Profit from Passion and Purpose, (Upper Saddle River : Wharton School Publishing, 2007.) Want, Jerome, Corporate Culture: Illuminating the Black Hole, (New York: St. Martin’s Press, 2007.) Video: Barbarians at the Gate, a Rastar production, 1993. Based on the book Barbarians at the Gate: The Fall of RJR Nabisco. Dances with Wolves, Tig Productions, 1990, Management (tribal council) considers what migration of whites will do to their society, culture, and way of life. As this is a long movie, you will likely want to show only a portion where the tribal council discusses how to deal with the impact of change and how they should handle it. The Target Shoots First, 2000, 70 minutes. Documentary. Directed, written, produced, and filmed by the lead character. A recent 22 year old college graduate goes to work at Columbia House and video tapes his work and experiences. He is a production manager for the mail order record business at Columbia. Subjects include learning the culture, norms, and psychological contracts. At the time this was written, this film was shown on the Sundance TV channel but not available. It may have since become available. This is a good film to lead off the semester. The film is also appropriate for Chapters 1 and 16. Wall Street, an Edward R. Pressman production; produced in association with American Entertainment Partners L.P.; directed by Oliver Stone; Twentieth Century Fox Film Corporation, 1987. SIMULATION PROCEDURES Simulation 3.1 (p. 74) Downsizing: A Consensus-Seeking Activity 1. Student premeeting preparation: a. Prepare and read the instructions. Prior to class, form into teams of six and select roles. Complete Step 1. 2. Suggestions: a. You may have students hand in a copy of their Individual Decision Worksheet. b. Step 6 has you leading a class discussion on the activity. But an alternative is to have a class member, ideally someone who was not on a team, lead the discussion. 3. Discussion points: a. Compare individual versus team criteria and decisions. b. Each student has a different set of values that influences their final rating system. c. Focus on issues of leadership, decision making, how each team sets differing norms, etc. d. Also look at the factors that form corporate culture. 4. Solutions: a. The important element here is the process used to develop ratings, more than the ratings themselves, because different criteria will provide different ratings. The suggested answers are based on ratings developed by groups of higher-level managers in a series of managerial seminars. b. The key is to identify the underlying values and assumptions that lead to the criteria selected, hence to corporate culture. In many companies, the employees may be given a choice between a layoff or taking a voluntary pay cut, and students often select this option. c. The rankings as developed by several executive groups follow (based on a maximum of 820). This is not a scientific survey and reflects a simple ranking by those taking the survey. d. The rankings follow at the end of this section. 5. Total time suggested: 75 minutes You will need to adjust these times to fit your specific schedule and class plans.
Minutes
Step 2 35
Step 3 5
Step 4 5
Step 5 15
Step 6 15
Total 75
Notes
Answers to Simulation 3.1 Ranking*
Ranking Employee
Least likely to be riffed 1. Carol
2. Tony
3. Sanjay
4. Jackie
5. Ken
6. Dave
7. Irv
8. Frank
9. Eduardo
Most likely to be riffed 10. Gwen
*The rankings reflect the opinions of 820 managers from executive groups who participated in this simulation. CASE TEACHING NOTES The Dim Lighting Co. (p. 81) I. Problems A. Macro 1. Will Dim Lighting be reactive? 2. Will Dim Lighting be proactive? B. Micro 1. Will Jim West be influenced by thoughts of what a second year of unattained targets will do to his career in making this budget decision? 2. West feels threatened every time Spinks does not receive his demands or “wish list.” II. Causes 1. Previous unprofitable year. 2. Spinks’ past history of leaving a company that “lacked creativity and innovation”. III. Systems affected 1. Structural – the structure is a traditional functional structure. This may not encourage the development of new products and ideas. 2. Psychosocial – other departments feel threatened by Spinks. In addition, Jim West feels he is under pressure to improve the profit margins immediately. 3. Technical – both the production manager and Spinks want money to upgrade technical aspects of the company. 4. Managerial – West feels caught between being innovative and trying to improve the bottom line immediately. 5. Goals and values – corporate headquarters does not seem to value risk taking and moving into new projects. If their rejection of the lighting proposal is indicative of their decisions, the company as a whole may become entrenched in old technology. IV. Alternatives 1. Before making a budget decision, West should contact corporate offices to see if additional funds are available for R&D. Spinks’ project would have a long-term effect on entire industry and possibly the parent company would contribute to the R&D project. 2. If additional funds are unavailable, the budget committee needs to make some compromises and come to a consensus-it should not be an all-or-nothing proposition. Funds should be allocated for both R&D and for upgrading essential equipment. 3. West should also ask the accountant, Preston, to make a three-tiered analysis of the project: (1) best-case scenario, (2) worst-case scenario, and (3) probable scenario. 4. West also needs to resolve his mixed feelings about the possibility of Spinks leaving. West needs to approach Spinks, praising him for what he has accomplished in the R&D department and asking him to help spread that high degree of morale across the company. West needs to make Spinks an ally rather than a potential deserter. V. Recommendations 1. First, try to obtain additional funds from parent company. 2. If additions are not available, obtain a consensus from the budget committee. Compromises will have to be made on length of time for R&D projects, what equipment is needed, etc. STUDENT PREPARATIONS FOR THE NEXT CHAPTER 1. Read Chapter 4. 2. Read and complete Steps 1 through 4 of OD Skills Simulation 4.1. 3. Read and prepare Case: The Grayson Chemical Company. Chapter 4 Role and Style of the OD Practitioner Learning Objectives 1. Define the role of an OD practitioner. 2. Identify your strengths and areas of improvement as a potential practitioner. 3. Experience and practice your own style of intervention and influence in a team. Student Premeeting Preparation 1. Read Chapter 4. 2. Read and complete Steps 1 through 4 of OD Skills Simulation 4.1. 3. Read and prepare Case: The Grayson Chemical Company. Instructor Preparation and Materials 1. Simulations: no special materials are required. 2. Stress to students that there are no right or wrong answers to the survey in Simulation 4.1. Become familiar with the scoring of the survey. LECTURE OUTLINE 1) Learning objectives. (pg. 87) a) Define the role of an OD practitioner. b) Identify your strengths and areas of improvement as a potential practitioner. c) Experience and practice your own style of intervention and influence in a team. 2) Haphazard versus planned change. (pg. 87) a) Change programs do not happen accidentally. i) They are initiated with a specific purpose and require leadership to function properly. ii) The OD practitioner must deal proactively with these changing competitive forces. iii) Everyone in the organization plays a crucial part in effective change programs. b) There are two types of change that may take place in an organization. i) One type is random or haphazard change. (1) It is forced upon the organization by the external environment. (2) It is not prepared for. ii) The second type of change results from deliberate attempts to modify organizational operations. c) This chapter discusses the second stage of an OD program, development of the practitioner-client relationship. (See Figure 4.1, Stage Two of Organization Development's Five Stages) 3) External and internal practitioners. (pg. 88) a) External practitioner. i) Someone not previously associated with the client system. ii) Advantages: (1) Sees things from a different viewpoint and from a position of objectivity. (2) Does not depend upon the organization for raises, approval, or promotions. iii) Disadvantages: (1) Generally unfamiliar with the organization system. (2) Unfamiliar with the culture, communication networks, and formal or informal power systems. b) Internal practitioner. i) Already a member of the organization who can be: (1) A top executive. (2) An organization member who initiates change in his or her work group. (3) A member of the human resources or organization development department. ii) Advantages: (1) Familiar with the organization’s culture and norms. (2) Need not waste time becoming familiar with the system. (3) Knows the power structure and who are the strategic people. (4) Has a personal interest in seeing the organization succeed. iii) Disadvantages: (1) May have a lack of the specialized skills needed for OD. (2) Lack of objectivity. (3) May be more likely to accept the organizational system as a given. (4) Other employees may not understand the practitioner’s role. (5) Other employees may be influenced by the practitioner’s previous work and relationships in the organization. (6) May not have the necessary power and authority. c) The external-internal practitioner team. (1) A team formed of an external practitioner working directly with an internal practitioner to initiate and facilitate change programs. (2) Partners bring complementary resources to the team. (a) External practitioner brings expertise, objectivity, and new insights. (b) Internal practitioner brings detailed knowledge of organization issues and norms and an awareness of system strengths and weaknesses. (3) Provides support to one another. (4) Achieve greater continuity over the entire OD program. (a) The external practitioner will likely be available only a few days a month. (b) The internal practitioner is provides continuous contact to the organization. (5) The team tends to combine the advantages of both external and internal practitioners while minimizing the disadvantages. 4) OD practitioner styles. (pg. 90) a) Internal or external practitioners have a variety of styles or approaches. b) One way to view styles is the degree of emphasis placed upon two dimensions: i) Effectiveness - the degree of emphasis upon goal accomplishment. ii) Morale - the degree of emphasis upon relationships and participant satisfaction. c) Based upon the two dimensions of accomplishing goals and member satisfaction, five different types of practitioner styles or roles can be identified. (see Figure 4.2, Practitioner Styles) i) Stabilizer style - maintains a low profile and it tries to survive by following directives of top management. ii) Cheerleader style - places an emphasis on member satisfaction and does not emphasize organization effectiveness. iii) Analyzer style - places emphasis on efficiency while giving little attention to satisfaction of members. Somewhat opposite of the cheerleader style. iv) Persuader style - seeks a compromise style between the cheerleader and the analyzer styles, but only achieves average performance on both styles. v) Pathfinder style - seeks both a high degree of organization efficiency and a high member satisfaction. This is the desired style for an OD practitioner. vi) The pathfinder practitioner focuses on six processes: (1) Communication. (2) Member roles and functions in groups. (3) Group problem-solving and decision-making. (4) Group norms and growth. (5) Leadership and authority. (6) Intergroup cooperation and competition. 5) The intervention process. (pg. 92) a) Involves a collaborative relationship between a practitioner and a client system. b) The readiness of the organization for OD. i) The practitioner needs to wait until key personnel decide whether change is really needed. ii) Four questions for the practitioner to answer before going further: (1) Are the learning goals of OD appropriate? (2) The cultural state of the client system ready for organization development? (3) Are the key people involved? (4) Members of the client system prepared and oriented to organization development? c) The intervention. i) Intervention refers to a coming between or among members or groups of an organization for the purpose of effecting change. ii) It refers to planned activities participated in by both the practitioner and the client. iii) Interventions occur throughout the OD program but here we are concerned with the practitioner’s initial contact with the client system. iv) The external practitioner generally intervenes through a top manager. d) Who is the client? i) Who the client is becomes more complex as the practitioner intervenes into more segments of the organization. ii) The client may be the organization, certain divisions, or an individual who contracted for the services. e) The OD practitioner role in the intervention. (1) Operates on the belief that the team is the basic building block of an organization. (2) Concerned with how processes such as communications and leadership occur in an organization. (3) Operates on the notion that assisting the client instead of taking control will lead to a more lasting solution of the client’s problems. f) OD practitioner skills and activities. i) One study found that the most practiced OD skill or activity was team development. (See Table 4.1, OD Practitioner Skills and Activities) ii) Six key skill areas that are critical to the success of the practitioner. (See Figure 4.3, Practitioner Skills Profile) (1) Leadership skills. (2) Project management skills. (3) Communication skills. (4) Problem-solving skills. (5) Interpersonal skills. (6) Personal skills. 6) Forming the practitioner-client relationship. (pg. 96) a) The practitioner/client relationship is a system of interacting elements consisting of the practitioner, the client contact or sponsor, and the client target system. (See Figure 4.4, A System’s View of the Change Relationship) b) Initial perceptions. i) The initial intervention is similar to a reconnaissance on the part of both the client and practitioner where both are evaluating each other. ii) First impressions are important, as they tend to set the climate for the future. iii) Developing a relationship based on mutual trust and openness is important. c) Concepts of perception. (See Figure 4.6, Perception Formation and Its Effect on Relationships) i) Perception is the process whereby individuals give meaning to the environment by interpreting and organizing sensory impressions. ii) People behave on the basis of what is perceived versus what really is. iii) Perception. (1) The process individuals use to interpret and organize sensory impressions. (2) What one perceives can be substantially different from reality. iv) Selective perception. (1) The selectivity of information that is perceived. (2) The process in which people tend to ignore some information that is in conflict with their values and to accept other information that is in accord with their values. v) Closure. (1) The tendency of the individual to fill in missing information in order to complete the perception. (2) A person perceives more to the situation than is really there. vi) Dilemma interactions that occur include: (1) Questions about client’s definition of the problem. (2) Client’s awareness of the need for change. (3) Client’s unrealistic expectations. (4) Client’s misuse of power. (5) Value differences between client and practitioner. d) Practitioner style model. (See Figure 4.7, Practitioner Style Model) i) The practitioner brings certain knowledge, skills, values, and experience to the situation. ii) The client system has its own subculture and level of readiness for change. iii) Together these determine the practitioner’s style and approaches. e) Developing a trust relationship. i) Openness and trust between practitioner and client is an essential aspect of the OD program. ii) Basic responses that a practitioner can use in the communication process. (1) Questions. (2) Applied expertise (advising). (3) Reflection. (4) Interpretation. (5) Self-disclosure. (6) Silence. f) Creating a climate for change. i) Practitioner should “practice what he or she preaches.” ii) Create climate of openness, authenticity, and trust. g) Practitioner-client relationship modes. (See Figure 4.8, Four Practitioner-Client Relationship Modes) i) Apathetic - keeps quiet about true ideas with practitioner, why bother because it won’t matter, skeptical about change. ii) Gamesmanship - keeps quiet about true ideas with practitioner, manipulates strategic factors to gain. iii) Charismatic - view of the changes are taken from cues from leaders; members view change as desirable if leaders approve; limited number of members share their own ideas. iv) Consensus - both client and practitioner share perceptions openly. The OD program is seen by the client as consistent with their way of operating. Differences are worked through. The OD practitioner attempts to operate from this mode. 7) The formalization of operating ground rules. (pg. 102) a) Formalization of obligations in the form of a contract is usually advisable for an external practitioner. b) The internal practitioner does not need a contract, but operating ground rules should be formalized in some manner (memo, letter, etc.) c) The contract with the external practitioner normally specifies such items as: i) Point of contact. ii) Role of the practitioner. iii) Fees. iv) Schedule. v) Anticipated results. vi) Operating ground rules. 8) Warning signs in the practitioner-client relationship. (pg. 102) a) The level of commitment to change of the client. b) The degree of leverage or power to influence change. c) The client’s manipulative use of practitioner power. OD Application Bain & Co. (p. 93) SUMMARY Bain & Co., a major worldwide consulting firm, works collaboratively with clients to assist them in making decisions in areas including strategy, organization, and operations. MAJOR POINTS • Offers services to governments, business, and nonprofit organizations. • Bain is known as the creator of “relationship consulting.” • Bain consultants work directly with the chief executive. • Bain employees are secretive about their organization and their clients, and dedicate themselves to improving their customers’ competitive position. • Bain focuses on the total system. • Bain consultants work collaboratively with the client to study, define, and assist in the implementation of the solution. • As Bain’s consultants have experience working with a wide group of clients, they tend not to have tunnel vision. • Bain helps their clients to make the big decisions in areas of strategy, organization, operations, technology, and mergers and acquisitions. • Bain does not make the decisions, but their consultants serve as a catalyst to help in the process. QUESTIONS 1. Do you agree with the relationship-consulting approach? Answer: Yes, the relationship-consulting approach is effective as it focuses on building strong, trust-based relationships with clients, leading to deeper understanding and more tailored solutions. This approach often results in better outcomes and long-term partnerships. 2. Visit Bain’s Web site (www.bain.com) and explore the firm’s current approaches to consulting. Answer: Bain & Company’s current consulting approaches emphasize data-driven insights, strategic innovation, and results-oriented solutions. They focus on helping clients achieve sustainable growth through tailored strategies, advanced analytics, and operational improvements. Bain also highlights a collaborative approach, working closely with clients to drive transformational change and deliver measurable results. 3. Contrast the approach of a company trying to solve its own problems versus bringing in outside consultants. Answer: Bain’s consultants operate from a larger frame of reference than do the managers from an organization. Though the consultants are careful not to disclose privileged information from other clients, they offer a perspective and point of view that comes from not being attached to a specific company or industry. A negative consequence is that the Bain consultant does not have the specific knowledge of a company. 4. What are the pros and cons of the external versus internal consultants? Answer: External consultants may be more objective, but have less understanding of the organization. The external consultant is generally unfamiliar with the organization system, and unfamiliar with the culture, communication networks, and formal or informal power systems. Internal consultants are familiar with the organization’s culture and norms, knows the power structure and who are the strategic people, aware of problems, familiar with the organization (structure, power networks, nature of business, etc.), and has a personal interest in seeing the organization succeed. However, internal consultants may be afraid for their jobs and too close to situation. Review Questions 1. What are the pros and cons of external and internal practitioners? Why is the team approach a viable alternative? Answer: External consultants may be more objective, but have less understanding of the organization. The external consultant is generally unfamiliar with the organization system, and unfamiliar with the culture, communication networks, and formal or informal power systems. Internal consultants are familiar with the organization’s culture and norms, knows the power structure and who are the strategic people, aware of problems, familiar with the organization (structure, power networks, nature of business, etc.), and has a personal interest in seeing the organization succeed. However, internal consultants may be afraid for their jobs and too close to situation. The team approach allows for benefits of each and may help cancel out negatives. A team permits sharing of different points of view. 2. Compare and contrast the five basic practitioner styles. Answer: Stabilizer: low emphasis on effectiveness, low on morale. Cheerleader: high emphasis on morale, low on effectiveness. Analyzer: high emphasis on effectiveness, low on morale. Persuader: moderate emphasis on both effectiveness and morale. Pathfinder: high emphasis on both effectiveness and morale. 3. Why is it important for an organization to be ready for an OD program? Answer: Just because an organization is in need of an OD program does not mean that it is receptive to one. Without readiness, few changes can take place and be effective or lasting. Rather than impose organization development upon an organization, the practitioner needs to wait until key personnel decide whether change is really needed. The motivation for a change program is then built in, not artificially contrived. 4. Identify basic problems in the practitioner-client relationship. Answer: The client may not be committed to change. Commitment may be based on words and not behaviors. The client may not have the leverage or power to influence change. The client may use the practitioner in a power struggle with other elements of the organization or as a means to gain information about others in the organization. 5. Explain the process of perceptions and how perceptions play a part in forming the relationship between the client and the OD practitioner. Answer: Developing a practitioner-client relationship involves an interaction between the parties that includes initial perceptions and assessments by each of the other. Assessments involve the practitioner’s determination of whether or not to enter into a relationship. The practitioner’s assessment includes the degree of congruence between his or her values and those of the client system. In the initial meeting, the practitioner is trying to evaluate the organization’s readiness and commitment for change, while the client system is assessing the practitioner’s capabilities. KEY WORDS AND CONCEPTS Define and be able to use the following words and concepts: Analyzer style - high on effectiveness, low on morale. (p. 91) Apathetic mode - follows established routine and avoids responsibility. (p. 101) Charismatic mode - relies on leaders to determine if change is desirable. (p. 101) Cheerleader style - high on morale, low on effectiveness. (p. 91) Client sponsor - person or group within the organization that has requested the practitioner’s help and who interfaces with the practitioner. (p. 96) Client target system - organization needing help in change. (p. 97) Closure – tendency to fill in missing information to complete a perception (p. 97) Consensus mode - decisions are made through the sharing of viewpoints. (p. 101) Dilemma interactions - occur in assessment stage of intervention and result from questions from practitioner regarding the client’s problem definition, awareness of need for change, reduction of over-expectations, client’s misuse of power, and value differences. (p. 98) External-internal team - change agents from both outside and inside the organization. (p. 90) External practitioner - change agent from outside the organization. (p. 89) Gamesmanship mode - sees life as if playing a game and the main goal is to be a winner. (p. 101) Internal practitioner - change agent from within the organization. (p. 89) Interpretation - communication responses used by practitioner to explain the meaning of something in terms the client can understand. (p. 97) Intervention - refers to the entrance into the client system and includes a variety of roles and activities. (p. 93) Pathfinder style - high on effectiveness, high on morale. (p. 92) Perception - process that individuals use to give meaning to their environment by interpreting and organizing sensory impressions. (p. 97) Persuader style - moderate emphasis on both morale and effectiveness. (p. 91) Selective perception - selectivity of information that is perceived. People tend to ignore information that they do not want to hear and accept information that is in agreement with their values. (p. 97) Stabilizer style - low on effectiveness, low on morale. (p. 90) ADDITIONAL RESOURCES Readings: Schein, Edgar, Process Consultation: Its Role in Organization Development (Reading, Mass.: Addison-Wesley, 1988), p. 13. Internet: The following are major management consulting firms with their Internet sites. Some have email services where they provide periodic updates. McKinsey & Company www.mckinsey.com Boston Consulting Group www.bcg.com Bain & Co. www.bain.com You could assign each of these consulting firms to an individual or a team where they do additional research and report back to the class. Video: Twelve O’clock High, 132 minutes. Twentieth Century Fox Film Corp. A tough general (Gregory Peck) takes over a bomber group in WW II. The bomber group is suffering from low morale and poor performance. He gets them into shape as a successful unit. You could have the class assume Major Stovall (Dean Jagger) is an OD practitioner to the general and the bomber group. This film can also be used in Chapter 13. SIMULATION PROCEDURES Simulation 4.1 (p. 105) Practitioner Style Matrix 1. Student premeeting preparation: a. The survey should be completed prior to the class meeting to save class time. Taking the survey and then scoring it will take around 30 to 60 minutes. b. To avoid any misunderstanding in answering the questions, it may be helpful to briefly discuss the instructions during the previous class period. 2. Additional suggestions: a. We have found it helpful to put the survey in the perspective of being an additional piece of feedback that can be compared with feedback from other sources. 3. Discussion points: a. Importance of recognizing practitioner style. b. Importance of getting valid feedback on style. c. Did the survey results seem compatible with your own perceptions and feedback received from others? d. If the feedback is accepted as being reasonably valid, can a person, if they are not satisfied with the results, effectively make a change in their behavior? 4. Total time suggested: 30 to 45 minutes You will need to adjust these times to fit your specific schedule and class plans.
Minutes
Steps 2 and 3 if needed 0 to 15
Step 5 30
Total
30 to 45
Notes
Simulation 4.2 (p. 110) Conflict Styles 1. Student premeeting preparation: a. The story and Line A could be completed individually prior to the class meeting to save class time. 2. Suggestions: b. The team decision made in Step 2 should be conducted as a time pressure situation. Accordingly, you may find it necessary to alter the time allowed. c. For a large class, some of the steps that call for class discussion could be conducted within smaller groups; but it will likely prove beneficial for you to conduct some discussion with the entire class at the end of the simulation. 3. Discussion points: a. Was there much disagreement within your group? b. If there was, to what could it be attributed? c. How did your group reach its decision (consensus, voting, etc.)? d. To what extent do you feel that other members of your group support the group’s decision? 4. Total time suggested: 50 to 65 minutes You will need to adjust these times to fit your specific schedule and class plans.
Minutes
Steps 1 and 2 5
Step 3 10 to 15
Step 4 5 to 10
Steps 5 and 6 5
Step 7 5
Step 8 15
Step 9 5 to 10
Total 50 to 65
Notes
Simulation 4.3 (p. 112) Perception 1. Student premeeting preparation: None. 2. Suggestions: a. This is a brief but effective simulation demonstrating the dynamics of perception. b. When having students count the number of “F’s,” try to keep the exercise moving quickly while letting the class have some fun. c. I take a quick survey of those counting exactly one F, then two, and ending with “Did anyone count more that six F’s.” I then ask them to count the number of F’s again. I usually have about 3 rounds of counting the F’s. With each round there are usually several students that change their count. On the last round I suggest for those not counting 6 F’s that they count the number of times the word “of” appears. 3. Discussion points: a. Perceptions. b. Do we sometimes overlook things that other people see? And how can this lead to disagreements? c. Is it possible to have confidence in what we see and hear but yet be flexible to other points of view? 4. Total time suggested: 20 minutes You will need to adjust these times to fit your specific schedule and class plans.
Minutes
Steps 1 to 4 10
Step 5 10
Total 20
Notes
CASE TEACHING NOTES The Grayson Chemical Company (p. 113) I. Problems A. Macro 1. Grayson has become stagnant, failed to change, and is no longer competitive. 2. The current people at Grayson are not acceptable to change. 3. There is a culture of doing things by the book. B. Micro 1. Incompetent managers promoted. 2. Board does not have a consensus of opinion. II. Causes 1. Grayson has not been proactive with its environment. 2. Corporate culture is very resistant to change. 3. Board does not speak with one voice. So entire organization is somewhat disorganized in its operations—no clear direction or focus III. Systems affected The entire organization is affected. The organization is still functioning; however, to be a healthy company and to grow, changes are needed. 1. Structural – with major changes, the structure could be radically altered. 2. Psychosocial – status quo and contentment seems to be prevalent among management. 3. Technical –there is evidence that managers are “fairly” competent technically, but this may not be enough to make the kind of changes that Grayson requires. 4. Managerial – the management currently seems to be comfortable in their positions and performance. The changes that Tom Baker may initiate would likely create turmoil in the management ranks. 5. Goals and values – the system seems to value putting in your time and you will get promoted. Excellence in performance is something not present at Grayson, but complacency seems to be prevalent. IV. Alternatives 1. Maintain status quo—do nothing. 2. Develop a pathfinder style, involve board, and organization members in renewing the company. 3. Develop a persuader style and avoid “rocking the boat” by making gradual or slow changes. V. Recommendations Develop pathfinder style, involve entire corporation in change process. Establish open communications with board and establish a consensus on what the board wants/expects/desires. Since incompetent managers have often been promoted, personnel changes should be made after thorough analysis of personnel. STUDENT PREPARATIONS FOR THE NEXT CHAPTER 1. Read Chapter 5. 2. Prepare for OD Skills Simulation 5.1. Form teams of six and select roles the preceding class. Complete Step 1. 3. Read and analyze Case: The Old Family Bank. Instructor Manual for An Experiential Approach to Organization Development Donald R. Brown 9780136106890
