CH-17 Managing Organizational Change and Learning – Organizations: Behavior, Structure, Processes : Chapter Notes

CHAPTER 17 Managing Organizational Change and Learning Chapter Overview The chapter begins by discussing the three approaches to undertaking organizational change and the learning principles that are critical to success. Three types of change agents are discussed (external, internal, combined internal-external approach). The intervener, or change agent, brings a different perspective to the situation and challenges the status quo. Change agents are external (temporary employees), internal (an individual working for the organization who knows something about its problems), and external-internal (combination team to intervene and develop programs). A brief overview of the strengths and shortcomings of each agent strategy is presented. The importance of internal and external forces for change in triggering an organizational development effort is explained. Three external forces (economic, technology, and social and political) and two internal forces (process and behavioral problems) are described. A three stage model of managing the organizational development process is presented, which provides the foundation for discussion of the components involved in organizational development. Managers must recognize there can be employee resistance to change. The process of managing change can be approached systematically. The model consists of seven specific steps generally acknowledged to be essential to successful change management: • Forces for change • Performance outcomes • Diagnosis of the problem • Selection of appropriate intervention • Limiting conditions • Implementation of the method • Evaluation of the method Problem diagnosis is discussed in terms of guidelines for accurate diagnosis, and the means of obtaining useful information (attitude surveys, interviews, observation, and archival sources). The depth of an intended change or intervention is also discussed. Students should recognize that the particular change technique chosen depends on the nature of the problem. Management must determine which alternative is most likely to produce the desired outcomes. The three change approaches differ in their focus; namely, to change structure, behavior, or technology. The importance of assessing limiting conditions (leadership climate, the formal organization, and organizational culture) and selecting the appropriate timing and scope of the implementation are also discussed, as well as potential ethical issues in organizational development. The implementation of proposed change has two dimensions: timing and scope. The chapter concludes with a brief overview of the steps that comprise program evaluation and summarizes the steps necessary for effective change management in addition to a brief explanation of learning capabilities and leadership. Learning Objectives By the end of the chapter, students should be able to: 1. Describe the seven-step model of organizational change. 2. Describe sources of change and alternative change management. 3. Discuss the ethical issues that arise in organizational development practices. 4. Compare alternative interventions that management can implement to improve performance. 5. Identify some of the major reasons why people resist change. Lecture Outline PowerPoint Slide Material from Text to Support Slide / Additional Comments To better understand how changes are brought about in individuals, we must comprehend the various principles of learning discussed in Chapter 6. Managers can design a theoretically sound organizational change program, yet not achieve any of the anticipated results because they overlooked the importance of providing motivation, reinforcement, and feedback to employees. These principles of learning serve to unfreeze old learning, instill new learning, and refreeze that new learning. Unfreezing old learning requires people who want to learn new ways to think and act. Unfreezing deals directly with resistance to change. Movement to new learning requires training, demonstration, and empowerment. Refreezing the learned behavior occurs through the application of reinforcement and feedback. When people receive encouragement, rewards, supportive information, or acclaim for doing something, they’re more likely to do the same thing in a similar situation. The other side of the coin might suggest punishment for not responding to training and new ideas. Punishment will decrease the probability of repeating old behavior but cannot encourage acquiring new methods and views. It is be easier to achieve successful change through the use of positive rewards. Because managers tend to seek answers in traditional solutions, the intervention of an outsider is often necessary. The intervener, or change agent, brings a different perspective to the situation and challenges the status quo. The success of any change program rests heavily on the quality and workability of the relationship between the change agent and the key decision makers within the organization. Thus, the form of intervention is a crucial consideration. To intervene is to enter into an organization or ongoing relationship among persons or departments, for the purpose of helping them improve their effectiveness. A number of forms of intervention are used in organizations. External change agents are temporary employees of the organization because they’re engaged only for the duration of the change process. They originate in a variety of organizational types including universities, consulting firms, and training agencies. Many large organizations have individuals located at central offices who take temporary assignments with line units that are contemplating organizational development. At the conclusion of the change program, the change agent returns to headquarters. The usual external change agent is a private consultant who has training and experience in the behavioral sciences. Such an individual will be contacted by the organization and then engaged after agreement is reached on the conditions of the relationship. Ordinarily, the change agent will have previous intervention experience and graduate degrees in specialties that focus on individual and group behavior in organizational settings. The internal change agent is an individual working for the organization who knows something about its problems. The usual internal change agent is a recently appointed manager or executive of the organization; often, the individual takes the job with the expectation that a major change is necessary. Some organizations use a combination external–internal change team to intervene and develop programs. This approach attempts to use the resources and knowledge base of both external and internal change agents. It involves designating an individual or small group within the organization to serve with the external change agent as spearheads of the change effort. The internal group can come from any level or function in the organization. As a general rule, an external change agent will actively nurture the visible support of top management as a way to emphasize the importance of the change effort The issue of people resisting change in organizations is inevitable. It is a well-known phenomenon to any manager who has tried to bring about organizational change. A corollary to the view that people resist change is that the greater the magnitude of the change, the greater will be the resistance. The resistance to change can range from passive resignation to deliberate sabotage. Managers need to learn the various manifestations of how people resist change. Research has found there are four primary reasons people resist change. Parochial Self-Interest Some people resist organizational change out of fear of losing something they value. Individuals fear the loss of power, resources, freedom to make decisions, friendships, and prestige. Misunderstanding and Lack of Trust When individuals do not fully understand why the change is occurring, and what its implications are, they will resist it. Misunderstanding the intent and consequences of organizational change is more likely to occur when trust is lacking between the person initiating the change and the affected individual Different Assessments Because individuals view change differently—its intent, potential consequences, and personal impact—there are often different assessments of the situation. Those initiating changes see more positive results because of the change, while those being affected and not initiating the changes see more costs involved with the change. Initiators of change often make two overly broad assumptions: (1) they have all the relevant data and information available to diagnose the situation, and (2) those to be affected by the change also have the same facts. Whatever the circumstances, the initiators and the affected employees often have different data and information. This leads to resistance to change. Low Tolerance for Change People resist change because they fear they will not be able to develop the new skills necessary to perform well. Individuals may understand clearly that change is necessary, but they may be emotionally unable to make the transition. A low tolerance for change also is found in individuals who resist change to save face. Making the necessary adjustments and changes would be, they assume, an open admission that some of their previous behavior, decisions, and attitudes were wrong. Resisting change is a human response, and management must take steps to minimize it. Reducing resistance can cut down on the time needed for a change to be accepted or tolerated. Also, the performance of employees can rebound more quickly if resistance is minimized. A number of methods have been useful in decreasing employee resistance to change. Several important methods are listed here: • Education and communication (explaining and informing). • Participation and involvement (involving employees in the process). • Facilitation and support (retraining and providing a range of support). • Negotiation and agreement (discussions with resisters and negotiation). • Manipulation and cooptation (bringing in supporters to guide others). • Explicit and implicit coercion (threats, taking away rewards, job loss). The process of managing change can be approached systematically. The steps can be portrayed in a logical way as suggested in Figure 17.2. The model consists of specific steps generally acknowledged to be essential to successful change management. A manager considers each of them, either explicitly or implicitly, to undertake a change program. Prospects of initiating successful change can be enhanced when managers actively support the effort and demonstrate that support by implementing systematic procedures that give substance to the process. The model indicates that forces for change continually act on the organization; this assumption reflects the dynamic character of the modern world. At the same time, it’s the manager’s responsibility to sort out the information that reflects the magnitude of change forces. The forces for change can be classified into two groups, environmental forces and internal forces. Environmental forces are beyond management’s control. Internal forces operate inside the firm and are generally within the control of management. Organizations seldom undertake significant change without a strong shock from their environment. The external environment includes many economic, technological, and social/political forces that can trigger the change process. Those who study and practice organizational change agree that these environmental triggers are necessary but not sufficient to initiate change. Change also involves managers who are aware of the change and who take action. Internal forces for change, which occur within the organization, can usually be traced to process and behavioral problems. The process problems include breakdowns in decision making and communications. Change agents facilitate the diagnostic phase by gathering, interpreting, and presenting data. Although the accuracy of data is extremely important, how the data are interpreted and presented is equally important. First, the data are discussed with a group of top managers, who are asked to make their own diagnosis of the information; or, second, change agents may present their own diagnoses without making explicit their frameworks for analyzing the data. A difficulty with the first approach is that top management tends to see each problem separately. Each manager views his problem as being the most important and fails to recognize other problem areas. The second approach has inherent problems of communication. External change agents often have difficulty with the second approach because they become immersed in theory and various conceptual frameworks that are less realistic than the managers would like. Appropriate action is necessarily preceded by diagnosis of the problem’s symptoms. Experience and judgment are critical to this phase unless the problem is readily apparent to all observers. Ordinarily, however, managers can disagree on the nature of the problem. There’s no formula for accurate diagnosis, but these questions point the manager or change agent in the right direction. The answers to the questions on the last slide can come from information ordinarily found in the organization’s information system, or it may be necessary to generate ad hoc information through the creation of committees or task forces. Meetings between managers and employees provide a variety of viewpoints that can be sifted through by a smaller group. Interviewing key personnel is an important problem-finding method. Another diagnostic approach that obtains broader-based information is the attitude survey. An intervention is a specific action that a change agent takes to focus the change process. Although the term has a generally used meaning, it has a specific meaning in the context of organizational development where it refers to a formal activity. Choice of a particular intervention depends on the nature of the problem that management has diagnosed. Management must determine which alternative is most likely to produce the desired outcome, whether it be improvement in skills, attitudes, behavior, or structure. Diagnosis of the problem includes specifying the outcome(s) that management desires from the change. Depth of intended change refers to the scope and intensity of the organizational change efforts. The idea is depicted in Figure 17.3, which likens the organization to an iceberg. This analogy draws attention to two important components: the formal and informal aspects of organizations. The formal components of an organization are like that part of an iceberg that’s above water; the informal components are observable, rational, and oriented to structural factors. On the other hand, the informal components are not observable to all people, are affective, and are oriented to process and behavioral factors. Both the formal and informal aspects of organizations can be changed in a methodical, deliberate way. Planned and managed change describes the systematic process of introducing new structures, behaviors, and technologies for accomplishing goals. Organizations can take any of these three approaches. Structural. The approach focuses on changing or redesigning jobs, workflow, or organizational structure. Organizations can become more organic, virtual, flat, or modular. Jobs and work can be enriched, combined, expanded, or converted to a virtual arrangement. Behavioral. Some refer to this as organizational development (OD). Team building, diversity training, enhancing/developing leadership skills and attitudes, and modifying employees’ knowledge and learning can be included under a behavioral change approach. Technological. This change could involve computers, intranets, the information technology (IT) infrastructure, materials, techniques, or automation of work processes. The three major alternative approaches to change—structural, behavioral, and technological—attempt to improve performance by improving communication, decision making, attitudes, and skills. These approaches are based on the assumption that changes in structure, behavior, and technology can result in improvements for the organization, individuals, and groups. Often changes in one area such as structure are related to changes in the other two areas. The anticipated outcomes of this system of interrelated changes include the factors shown in Figure 17.4. Accomplishing all of the anticipated outcomes would be worthwhile for any manager. However, any successes may be limited because of implementation problems, resistance to change, and various other conditions. Many observers believe that the disappointing performance of such technological change is due to management’s neglect of the structural and behavioral changes that must accompany technological change. Specifically, employees’ jobs have not been redesigned in a way that both makes the best of new technology and addresses the employees’ social and psychological needs. A mismatch exists between technology, how workers perform their jobs, and how managers supervise the workers. Consequently, technology’s potential isn’t realized. Changes are necessary in a number of areas, including the following: Employee training. Workers must be highly skilled to handle the substantial team responsibility for a major part of the manufacturing process. Team members must understand the technology to oversee machine functions and be skilled in diagnostic problem solving and communicating to quickly correct the glitches that sometimes occur. Thus, technological change essentially alters the amount and type of training. Compensation. Many companies with highly automated manufacturing process and employee teams have implemented a pay-for-knowledge compensation system. Individualized pay approaches, such as a piece-rate system, don’t work because the contributions of individual employees are difficult to measure. The pay-for-knowledge approach boosts team flexibility. Management style. Because of the nature of their responsibilities, teams working with highly automated processes often have much more authority in performing their tasks than do individuals in more traditional assembly line jobs. This increase in employee autonomy changes the nature of the manager’s job. The emphasis shifts from supervision and control to coaching and consultation. Technological change also requires that managers broaden their knowledge to include a thorough understanding of the new technology. Appreciative inquiry (AI) is a method of focusing on positive or potential opportunities. Appreciation means to value, see the best in others, and recognize positive potential. The concept of inquiry refers to the systematic analysis and the openness to discovery. In essence appreciative inquiry involves a method for bringing about positive change. AI proposes that organizations and individuals are creative enough to develop programs, relationships, and behaviors that address success, personal growth, and fulfillment. It searches for an attempt to bring out the best in people, the organization, and the external environment. AI uses the art and practice of asking probing questions that can strengthen an individual or an organization’s ability to anticipate, seize, and initiate positive potential. In a concise form, AI is • A methodology that takes the idea of social construction of reality by utilizing metaphors and narratives. • A positive approach to change that completely lets go of problems-based management. • An emphasis on individual engagement to bring about creative solutions. The 4-D process begins with discovering or appreciating what is the “best” in the current situation being examined. This could involve determining what employees like about their work, unit, or colleagues. As this discussion evolves, the next “D” phase emerges, dreaming. What would make the work, unit, or colleague’s ideal? Talking about ideals and the value of being in an ideal situation shifts the process to the third “D” phase: designing or exchanging thoughts and eventually formulating and constructing with others a collective model of what an ideal group, team or work setting would be in terms of schedules, expectations, roles, responsibilities, rewards, and goals. Once the ideal model is conceptualized, discussed, modified, and produced, the focus shifts to the fourth “D” phase, delivering. Now is the time to establish a plan, an execution strategy, and a set of goals to change the situation being examined. Instead of the “ideal,” the theme is now actually altering the real situation or setting. Forces primarily in the external environment have encouraged various types of change in U.S. organizations: downsizing, empowerment, virtual jobs, and flextime. Each type of change usually brings about changes in the structural, behavioral, and technological aspects of the organization. The selection of a change technique is based on diagnosis of the problem, but it is also tempered by the conditions at the time an intervention is to occur. Three such limiting conditions are the leadership climate, the formal organization, and the organizational culture. Leadership climate refers to the nature of the work environment that results from the leadership style and the administrative practices of managers. Any change program not supported by management has only a minimal chance of success. The nature of the work environment that results from the leadership style and administrative practices of managers is termed the leadership climate. It can greatly affect a change program. Any change program that lacks management’s support and commitment has only a slim chance of success. The formal organization includes the philosophy and policies of top management, as well as legal precedent, organizational structure, and the systems of control. The implementation of proposed change has two dimensions: timing and scope. Timing is knowing when to make the change. The matter of timing is strategic; it depends on a number of factors, particularly the organization’s operating cycle and the groundwork that has preceded the change. Scope is knowing how much of a change to make. A change of considerable magnitude should not compete with ordinary operations. It might be easier to implement during a slack period. On the other hand, if the change is critical to the survival of the organization, then immediate implementation is in order. Organizational change involves applying powerful behavioral science knowledge by a change agent to bring about performance improvements. The ethical issues turn on the power relationships of the various participants in the change effort. At the most fundamental level, critics note that change is based largely on the existing power relationships in the organization because the effort is initiated by managers. As a managerial technique, change necessarily implements managerial values regardless of the values of the change agent. The change can be inherently unethical because it restricts the range of values that can legitimately be considered in bringing about the change. William G. Dyer, who has spent 30 years assisting organizations to reach their potential effectiveness. He states that the following conditions must be present if the intervention is to have some chance of bringing about the desired change: 1. Management and all those involved must have high and visible commitment to the effort. 2. People who are involved need to have advance information that enables them to know what is to happen and why they are being asked to do what they are to do. 3. The effort (especially the evaluation and reward systems) must be connected to other parts of the organization. 4. The effort needs to be directed by line managers and assisted by a change agent if necessary. Continued on next slide. Previous slide continues 5. The effort must be based on good diagnosis and must be consistent with the conditions in the organization. 6. Management must remain committed to the effort throughout all its steps, from diagnosis through implementation and evaluation. 7. Evaluation is essential and must consist of more than asking people how they felt about the effort. 8. People must see clearly the relationship between the effort and the organization’s mission and goals. 9. The change agent, if used, must be clearly competent and perceived as competent. These nine conditions combine the important points we’ve made in this chapter. Taking them together, we can see that organizational development is a significant undertaking and that managers should go about it in a systematic way. The model for managing change offers a systematic process for realizing the nine conditions for success that Dyer states are necessary, but not sufficient, for bringing about organizational effectiveness. Peter Senge, in his best-selling book The Fifth Discipline, described a learning organization as proactively creating, using, and transferring knowledge to change its behavior. Sharing knowledge, experience, and ideas becomes a habit in a learning organization. A number of factors that facilitate organizational learning have been identified. Table 17.1 presents numerous different factors and briefly explains each of the factors. For example, it lists a climate of openness, which involves an openness to information, the encouragement of sharing, and debate. 1. Scanning the environment Interest in external happenings and in the nature of one’s environment. Valuing the processes of awareness and data generation. Curious about what is “out there” as opposed to “in here.” 2. Performance issues Share perception of a gap between actual and desired state of performance. Disconfirming feedback interrupts a string of successes. Performance shortfalls are seen as opportunities for learning. 3. Metrics Spend effort to define and measure key factors; strive for specific, quantifiable measures; discourse over metrics is seen as a learning activity. 4. Experimental philosophy Support for trying new things; curiosity about how things work; ability to “play” with things. Small failures are encouraged, not punished. See changes in work processes, policies, and structures as a continuous series of graded tryouts. 5. Transparency Accessibility of information, relatively open boundaries. Opportunities to observe others; problems/errors are shared, not hidden; debate and conflict are acceptable. 6. Education Ongoing commitment to education at all levels; support for growth and development of members. 7. Operational variety Variety exists in response modes, procedures, systems; significant diversity in personnel. Pluralistic rather than monolithic definition of valued internal capabilities. 8. Multiple advocates Top-down and bottom-up initiatives are possible; multiple advocates and gatekeepers exist. 9. Engaged leaders and role models Leadership at significant levels articulates vision and is very actively engaged in its actualization; takes ongoing steps to implement visions; “hands-on” involvement in educational and other implementation steps. Managers who also lead can create or contribute to the learning environment. The building and sustaining of a learning organization requires a commitment to learning, the generation of creative ideas that are implemented, and the desire to build cohesive teamwork, collaboration, and support. Table 17.2 presents a list of activities that can be performed to build learning within an organization. A major result of an effective learning organization is that knowledge is managed more effectively. Knowledge management is the sharing of information to achieve innovation, competitive advantage, and productive accomplishments. Although a learning organization leads to knowledge management, it is also true that by managing knowledge, organizations will learn. Learning and managing knowledge are not enough in a constantly changing work environment. Pfeffer and Sutton correctly suggest that many firms have fallen into a knowing– doing gap. What is learned and knowledge gained about change, strategies, and resistance must be converted into action and evaluation. It is easier and more comfortable to talk intellectually about empowerment, converting to more telecommuting, or eliminating layers of management than to actually execute a change. The challenge facing managers who understand change, learning organizations, and knowledge management is to become action oriented and decisive. Converting a traditional organization to a more learning-oriented institution requires changing the way information and experiences are used. Managers must change the way information is sought, used, stored, and reviewed. Information must be shared, available, and transparent. These requirements are resisted because they are not usually the way information is viewed. Managers who believe in the learning organization concept actively work to make information, new ideas, and creativity a part of the culture of their unit, project, or department. The need to consider organizational development arises from changes in the inter- and extra organizational environment. Changes in the input, output, technological, and scientific sub environments may indicate the need to consider the feasibility of a long-term, systematically managed program for changing the structure, process, and behavior of the organization. Even in the absence of environmental changes, organizational processes and behavior may become dysfunctional for achieving organizational effectiveness. The diagnosis of present and potential problems involves the collection of information that reflects the level of organizational effectiveness. Data that measure the current state of production, efficiency, satisfaction, adaptiveness, and development must be gathered and analyzed. The purpose of diagnosis is to trace the cause of the problem. In addition to serving as the basis for problem identification, the diagnostic data also establish the basis for subsequent evaluation of the organizational development effort. Lecture Tips Lecture Ideas 1. To help students gain an understanding of why people fear and resist change (an inherent obstacle to OD implementation), have your students, on an individual basis, recall to themselves a time when they feared change in a particular situation. Then divide the class into groups and have members in each group discuss within the group the reasons and factors contributing to their resistance. Once students' initial reluctance to talk about their resistance to change subsides; group discussion should be insightful. 2. As the chapter notes, sometimes an organization's culture can substantially hinder efforts to achieve organizational change because the culture doesn't fit or accommodate the change. Increasingly, management at many companies is realizing the importance of organizational culture and is changing the culture when it's dysfunctional. However, the task is quite difficult. 3. Have students discuss how managers can plan for change. Is there any validity in the statement, “plan your work, work your plan”? Have students discuss the need for change. How can we overcome resistance to change? Is it because we are locked in to a routine we do not like to break from? Have students outline benefits versus cost of implementing change. 4. Should we ever try to stimulate change? Have students discuss a proactive approach to change. Project and Class Speaker Ideas 1. To enhance students' understanding of the impact of technological change, as a group project, have your students identify a local business that has recently undergone substantial technological change (e.g., the introduction of robotics, computerization, or other new production technologies). Have the students prepare a written report on the effects of the change on the organization. The students can gather the information by interviewing a representative of the organization who was involved in implementing the change. Alternatively, students can research an organization reported in the business media that has recently undergone substantial technological change and report on its effects using published articles. 2. Invite a member of the psychology faculty to speak to the class about why people fear and resist change. This psychological perspective should add much to students' understanding of the issue. 3. If one is available, invite an OD consultant to discuss the process of organizational development and change from a consultant's perspective. He/she can provide insights into the diagnosis of problems, minimizing resistance to change, the selection of change techniques, and implementing and evaluating change efforts. Discussion and Review Questions 1. Why is diagnosis so vital in organizational change programs? Answer: Diagnosis of a problem is vital because management must know what the true problem is, distinct from the symptoms of the problem. Then they must identify what must be changed to resolve the problem. Finally, they must identify which outcomes are expected from the change, and how to measure them. 2. Explain the concept of organization intervention and why any particular management or organizational change can be considered an intervention. Answer: The concept of organization intervention is fairly broad and includes any practice, procedure, or technique that is intended to improve organizational functioning. As the iceberg concept suggests, there are many levels of organizational functioning, and interventions can be aimed at a particular level or span several levels. Any change introduced into the organization will undoubtedly affect some level of the iceberg; thus, it would be considered an intervention. 3. Might some managers attempt to implement a particular intervention, such as TQM, without first diagnosing whether the intervention would be appropriate for their organization's problems? Answer: Yes. Unfortunately, this is not an uncommon problem. Managers often proceed with an intervention without a thorough diagnosis because they are anxious to solve what ails their unit or organization and are very vulnerable to what they may perceive as quick fixes or panaceas for their problems. In reality, there are no quick fixes or easy solutions if problems are to be permanently solved. Managers also look to what other organizations may be doing to solve a particular problem and if they hear an intervention worked for a given company, they assume it will work in their own company. They fail to recognize the importance of differing conditions between organizations or the fact that they may have incorrectly diagnosed a problem. 4. Why is it important for managers to reduce the resistance to change openly displayed or covertly practiced by employees? Answer: Employee resistance to change is a behavioral and/or emotional response to actual, perceived, or imagined threats brought about by the change. This triggers rational and irrational emotional reactions because of the uncertainty involved. These reactions, in turn, trigger unpredictable and often counter-productive behavior, neither of which is beneficial to productivity and efficiency. 5. Evaluate the ethical issues associated with downsizing an organization by reducing its labor force to increase the organization's long-run chance of survival. What other ethical issues can you identify in the practice of organizational development, as you understand it thus far? Answer: This question should spark a good deal of discussion because it is likely that many students will be able to relate incidents where either close family members and perhaps even themselves have been victims of a downsizing effort. Many of the ethical issues involved in organizational development center around power differences between management and employees, and the potential for management to misuse their power in order to force or manipulate employees to go along with a particular change effort. As most students will probably note, it is management who decides to downsize, with little or no input or information from lower-level employees. Moreover, some organizations disguise the true intent of their restructuring and may even label the effort as an “expansion” (when in fact many jobs are being lost). Downsizing to ensure long-term survival raises ethical issues such as the impact on employees' livelihoods, potential lack of transparency in decision-making, and the fairness of how layoffs are conducted. Other ethical issues in organizational development include ensuring equitable treatment in promotions, maintaining honest communication about organizational changes, and addressing potential biases in decision-making processes. 6. Describe the relationships among the steps of the change model depicted in this chapter and the process of unfreezing-movement-refreezing. Which steps of the model are related to which elements of the relearning process? Answer: The diagnosis step in the model corresponds to the unfreezing stage because the organization is likely to face some kind of resistance as the change agent(s) attempt to analyze and suggest problems and reasons for those problems. Unfreezing old learning may also be necessary when the chosen change effort is actually implemented as well. Movement corresponds to two components of the model: selection of the appropriate intervention and the implementation of the method. The refreezing process involved in a change effort relates very well to the evaluation and feedback steps in the organizational development model. In these steps, the organization needs to carefully monitor behavior and outcomes and provide the proper reinforcement so new ways of behaving become second nature. 7. How is appreciative inquiry a different approach to organizational change than a problem-solving approach? Answer: The bulk of organizational change and development programs start any diagnosis with an emphasis on identifying problems, shortfalls, or deficiencies such as sexual harassment problems, excessive costs or resource limits, and not meeting a previously established performance goal. Appreciative inquiry is a method of focusing on positive or potential opportunities. It searches for and attempts to bring out the best in people, the organization, and the external environment. 8. What Why is top management support so important for the success of an organizational development and change initiative? Answer: The formal organization includes the philosophy and policies of top management, as well as legal precedent, organizational structure, and the systems of control. Of course, each of these sources of impact may itself be the focus of the change effort. The important point is that a change in one must be compatible with all of the others. It may be possible to design organizations that not only facilitate change, but also actually welcome it. 9. Explain the difficulties that you would encounter in attempting to obtain diagnostic information from members of two groups who believe that they are competing for scarce resources. Answer: There is difficulty encountered in obtaining information not only from these types of groups, but other antagonistic groups as well. The data obtained from these groups are distorted and inaccurate. Often the inaccuracies are not intentional, but nevertheless, the fact that the data represent perceptual differences can become the focus of subsequent problem solving per se. 10. Explain why a change program should be evaluated and why such an evaluation is so difficult to do. Answer: Evaluation is essential to determine the program's effects (whether it achieved the intended objectives) and to take any corrective actions in intervention implementation to boost the effort's results. Evaluation is especially difficult when it involves measuring rather intangible factors such as job satisfaction and morale (rather than output or manufacturing productivity). Case For Analysis: Bayer’s Major Changes in One Plant Case Summary Before Bayer’s acquisition of a production facility in Myerstown PA, the plant had undergone major changes within a short period of time. Ownership had changed three times; the workforce was cut in half. Employees were uncertain about what changes this new ownership would bring, especially since there had been no plant manager for a while. There were also the problems of ramping up to Bayer’s expectations of a 24/7 production schedule with an acquisition weary workforce and the fact that the plant was operating in the red. The functional department manager and the HR manager worked as a team to manage the plant through that trying time. They realized that employees needed to be involved and, with the help of a management-consulting firm, the HR team embarked on a present-state analysis. They selected 93 employees at random to participate in seven focus group meetings to get a clear indication of what was going on at the plant. The information was compiled and the employees who hadn’t participated in the focus groups were asked to comment on the findings. The input was analyzed and many issues that required attention were brought up. The HR team addressed workers at an all-employee meeting about the first initiative - developing a site strategy and goals. All five initiatives and the following site strategy were introduced in a subsequent meeting. The employees felt communication about onsite performance, department projects, and rumors was important and they initiated a monthly electronic newsletter for the site management team. This information was in turn discussed with those who reported to the team. Some employees were still skeptical because they weren’t certain the managers were sincere. Several previous programs had failed. Even though there was employee resistance, formal communications has improved and the management analysis and implementation of new strategies are working. The future is positive and appears management and employees are working together to achieve team unity and the accomplishment of organizational goals. Answers to Case Questions 1. What type of change(s) occurred at Bayer? Answer: Major changes that have occurred at Bayer are tremendous uncertainty to the future. There has been a change in ownership at three different times creating an unstable and uncertain future. With the change of ownership there has been a morale issue, which is derived from the lack of job security with the operating employees. Communication increased by initiating the “Myerstown Information Exchange,” an electronic monthly newsletter sent to members of the site management team which was discussed with those who report to them. 2. What type of employee resistance to change did Bayer have to address? Answer: The type of employee resistance Bayer management must address are issues derived by the initiation of the organization and development program initiated by the HR manager Danchisko. Another form of employee resistance was the skepticism of employees toward management in the creation of an organizational development program. Such token programs that failed in the past included, WQC (work quality circles), JIT (just-in-time manufacturing), SPC (statistical process control), and Team-based manufacturing. 3. What are the positive and the negative lessons learned from how change was handled at Bayer? Answer: One of the positive lessons learned from the Bayer turnaround is employee participation. Employee involvement is essential in the day to day operations of this plant. A proactive approach by management is paramount where there are fewer levels of management and increased employee empowerment. Programs initiated include to be clearly recognized as Bayer Consumer Care’s most effective site in the Northern America’s region in terms of safety, customer service, value-added manufacturing/packaging, and cost effectiveness. Employee resistance to change can be overcome by acknowledging not only the business rationale for change but also the hopes, fears, and dreams of those affected. Some of the negative lessons learned at Bayer, unless management is sincere and reassuring to their employees morale will continue to be a problem at this company. Other negatives include the lack of stability and permanent ownership of this facility. Finally, a negative, management must be reassuring to employees commitment is necessary for long term survival and growth. Experiential Exercise: Alternative Ways to Initiate Change Objective To evaluate alternative ways to initiate training in the face of possible resistance from both employees and their supervisors. The Exercise in Class Use this exercise to re-introduce the Vroom-Yetton-Jago model of decision making. Each of the five alternatives represents a slightly different variation of participation. There is also the opportunity to discuss the applicability of attribution theory since the mistakes have been associated with plant-wide inability to perform a particular operation. The distribution of responses can be forced to include all five choices by assigning each group a different one of the five alternatives and have the group defend that alternative. Ten Term Paper Topics 1. Participative Management: An Overview of Strengths and Shortcomings 2. (Selected case): A Profile of a Change Strategy Implementation 3. Why People Fear and Resist Change 4. The Impact of Technological Change on the Individual Worker 5. The Internal and External Forces of Organizational Change 6. The Importance of Timing in Organizational Change 7. Techniques for Evaluating Organizational Change 8. Organizational Culture: It’s Impact on the Effectiveness of Organizational Change 9. Managerial Strategies for Overcoming Resistance to Change 10. Approaches to Change Agent-Client Relationships: An Overview and Critique Instructor Manual for Organizations: Behavior, Structure, Processes James L. Gibson, John M. Ivancevich, James H. Donnally, Robert Konopaske 9780078112669, 9781259097232, 9780071086417, 9780071315272