Transcript Management 3e - Gary Dessler

Principles and Practices for Tomorrow’s Leaders
Gary Dessler
CHAPTER
Managing Organizational
Change
8
The Environment of Managing
PowerPoint Presentation by Charlie Cook
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Chapter Objectives
After studying this chapter and the case exercises at
the end, you should be able to:
1. Decide if the company should reorganize, and,
if so, what the new structure should look like.
2. “Read” the company’s organization culture and
make specific recommendations to improve it.
3. Tell the manager what he or she did wrong in
implementing the change.
4. Decide what conflict-resolution style is right for
the situation.
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8–2
Basic Questions for Change Agents
• What are the forces acting upon me?
 What are the pressures I should take into
consideration as I decide what to change and
how I should change it?
• What should we change?
 Should the changes be strategic and
companywide or relatively limited?
• How should we change it?
 How should we actually implement the change?
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8–3
Model for Planned Organizational Change
Source: Adapted from Larry Short, “Planned Organizational Change,” MSU Business Topics, Autumn 1973,
pp. 53–61 ed. Theodore Herbert, Organizational Behavior: Readings and Cases (New York: McMillan, 1976), p. 351.
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FIGURE 8–1
8–4
Strategic Change
• Strategic change
 A change in a firm’s strategy.
• Sources and Effects of Strategic Change
 Strategic changes are usually triggered by factors
outside the company.
 Strategic changes are often required for survival.
 Strategic changes implemented under crisis
conditions are highly risky.
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8–5
Other Approaches to Change
• Technological Change
 Changing the way the company creates and markets
its products or services.
• Structural Change
 Changing one or more aspects of the company’s
organization structures.
 Reorganizing: changing the firm’s organization chart
and structural elements.
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8–6
Is a New Structure Really Required?
When you identify a problem
with your design, first look for
ways to fix it without
substantially altering it. If that
doesn’t work, you’ll have to
make fundamental changes or
even reject the design. Here’s a
step-by-step process for
resolving problems.
Source: Adapted from Michael Goold and Andrew Campbell, “Do You Have a
Well-Designed Organization?” Harvard Business Review, March 2002, p. 124.
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FIGURE 8–2
8–7
Is Your Organization Well-Designed?
• The market advantage
test
• The parenting
advantage test
• The people test
• The feasibility test
• The specialist culture
test
• The difficult-links test
• The redundanthierarchy test
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• The accountability test
• The flexibility test
8–8
Is a New Structure Really Required? (cont’d)
When you identify a problem with
your design, first look for ways to
fix it without substantially altering
it. If that doesn’t work, you’ll have
to make fundamental changes or
even reject the design. Here’s a
step-by-step process for resolving
problems.
Source: Adapted from Michael Goold and Andrew Campbell, “Do You Have a
Well-Designed Organization?” Harvard Business Review, March 2002, p. 124.
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FIGURE 8–2b
8–9
Checklist 8.1
How to Read an Organization’s Culture




Observe the physical surroundings.
Sit in on a team meeting.
Listen to the language.
Note to whom you are introduced and
how they act.
 Get the views of outsiders, including
vendors, customers, and former
employees.
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8–10
Creating and Sustaining the Right
Corporate Culture
1. Make it clear to your employees what you pay
attention to, measure, and control.
2. React appropriately.
3. Use “signs, symbols, stories, rites, and
ceremonies.”
4. Deliberately role model, teach, and coach the
values you want to emphasize.
5. Communicate your priorities by how you allocate
rewards.
6. Make your HR procedures and criteria consistent.
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8–11
Why Do People Resist Change?
• Lack of information or honest disagreement over
the facts concerning change.
• Personal and emotional fear of loss of job,
relationships, and/or status.
• Personality traits: poor self-image, low tolerance
for ambiguity and risk.
• Change creates competing commitments.
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8–12
How Immune Is the Person to Change
Source: Robert Kegan and Lisa Lahey, “The Real Reason People
Won’t Change,” Harvard Business Review, November 2001, p. 89.
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FIGURE 8–3
8–13
Kurt Lewin’s Model of Change
• Unfreezing
 Involves reducing the forces for the status quo,
usually by presenting a provocative problem or
event to get people to recognize the need for
change and to search for new solutions.
• Moving
 Using techniques and actually altering the
behaviors, values, and attitudes of the individuals in
an organization.
• Refreezing
 Preventing a return to old ways of doing things by
instituting new systems and procedures that
reinforce the new organizational changes.
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8–14
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8–15
Business Process Reengineering
• Business Reengineering
 The radical redesign of business processes to cut
waste; to improve cost, quality, and service; and to
maximize the benefits of information technology,
generally by questioning how and why things are
being done as they are.
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8–16
A Nine-step Process For Leading
Organizational Change
1. Create a Sense of
Urgency
2. Decide What to Change
3. Create a Guiding
Coalition and Mobilize
Commitment
4. Develop and
Communicate a Shared
Vision
5. Empower Employees to
Make the Change
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6. Generate Short-Term
Wins
7. Consolidate Gains and
Produce More Change
8. Anchor the New Ways
of Doing Things in the
Company Culture
9. Monitor Progress and
Adjust the Vision as
Required
8–17
Redesigning Mortgage Processing
at Banc One
Shifting from a traditional approach
helped Banc One Mortgage slash
processing time from 17 days to 2.
FIGURE 8–4
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8–18
Barriers to Empowerment
Source: Reprinted by permission of Harvard Business School Press. From
Leading Change by John P. Kotter. Boston, MA. 1996, p. 102. Copyright ©
1996 by the President and Fellows of Harvard College, all rights reserved.
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FIGURE 8–5
8–19
Some of
Nissan’s
CrossFunctional
Teams (FTs)
Source: Adapted from Carlos Goshn, “Saving the Business Without Losing
the Company,” Harvard Business Review, January 2002, pp. 40–41.
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FIGURE 8–6
8–20
A Special Kind of Change: Becoming an
E-Business
• E-Business Issues
 Clicks and bricks: blending the old business and the
e-business cultures.
 E-business’s effects on finance, human resources,
training, supply-chain management, customerresource management, and just about every other
corporate function.
 How to structure the new enterprise.
the new e-business into the company’s current
structure
 Organize the e-business as a separate entity.
 Blend
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8–21
Organizational Development
• Organizational Development (OD)
 An approach to organizational change in which
the employees themselves formulate the change
that’s required and implement it, usually with the
aid of a trained consultant.
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8–22
OD Interventions
• Human Process Interventions
 Aimed at enabling employees to develop a better
understanding of their own and others’ behaviors for
the purpose of improving that behavior such that the
organization benefits.
• Sensitivity Training (Laboratory or T-groups)
 Purpose is to increase participants’ insight into their
own behavior and that of others by encouraging an
open expression of feelings in a trainer-guided group.
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8–23
OD Interventions (cont’d)
• Team Building
 The process of improving the effectiveness of a team
through action research or other techniques.
• Survey Research
 The process of collecting data from attitude surveys
filled out by employees of an organization, then
feeding the data back to workgroups to provide a
basis for problem analysis and action planning.
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8–24
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8–25
Technostructural Applications of OD
• Formal Structure Change Program
 An intervention technique in which employees
collect information on existing formal organizational
structures and analyze it for the purpose of
redesigning and implementing new organizational
structures.
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8–26
Strategic Applications of OD
• Strategic Intervention
 An OD application aimed at effecting a suitable fit
among a firm’s strategy, structure, culture, and
external environments.
• Integrated Strategic Management
 An OD program to create or change a company’s
strategy by:
 Analyzing
the current strategy
 Choosing a desired strategy
 Designing a strategic change plan
 Implementing the new plan.
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8–27
Conflict Handling Styles
Source: Source: Kenneth W. Thomas, “Organizational Conflict,” ed., Steven Kerr, Organizational Behavior (Columbus, OH:
Grid Publishing, 1979), in Andrew DuBrin, Applying Psychology (Upper Saddle River, NJ: Prentice Hall, 2000), p. 223.
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FIGURE 8–7
8–28
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8–29