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Learning Objectives
1. Define the concept of organization development and recognize the need for change and renewal. 2. Describe organization culture and understand its impact on the behavior of individuals in an organization. 3. Understand the expectations of the psychological contract formed on joining an organization. 4. Describe the five stages of organization development.
LECTURE OUTLINE
1) Learning objectives. (pg. 3)
a) Define the concept of organization development and recognize the need for change and renewal. b) Describe organization culture and understand its impact on the behavior of individuals in an organization. c) Understand the expectations of the psychological contract formed on joining an organization. d) Describe the five stages of organization development.
c) Why OD? i) Most cited reasons for beginning a change program: (1) The level of competition. (2) Survival. (3) Improved performance. ii) Primary goals of change programs: (1) Change the corporate culture. (2) Become more adaptive. (3) Increase competitiveness. d) Factors leading to the emergence of OD. i) The need for new organizational forms. ii) The focus on cultural change. iii) The increase in social awareness.
b) OD specialists. i) Professionals trained in OD. ii) Sometimes called OD consultants. iii) Specialists are: (1) Internal practitioners from within the organization. (2) External practitioners from outside the organization. c) Managers and leaders applying OD principles and concepts. i) May not call what they do OD. ii) The activities include: (1) Team leaders developing and coaching teams. (2) Building learning organizations. (3) Implementing total quality management. (4) Creating boundaryless organizations.
iii) Creative individualism - acceptance only of pivotal values; rejection of others. e) Creative organizations encourage feedback and allow employees to examine openly the pivotal and peripheral norms.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
OD Applications
GEs Epicenter of Change (p. 7)
SUMMARY
GEs Leadership Center is the tool that the company uses to spread change throughout the organization. The Center is at the forefront of real-world application for organizational development, leadership, innovation and change.
MAJOR POINTS
The participants (around 10,000 annually) at the center include entry-level to the highest-performing executives. GE also invites customers to the center to help solve mutual problems. Courses typically run one to three weeks. Subjects include leadership and essential basic management skills such as team building and giving presentations. Executive courses incorporate subjects in leadership, innovation, and strategy. Participants typically are 50% non-U.S. and new centers have opened outside of the U.S. GE believes that building strong leaders is strategically imperative. GEs current challenges and future success depends in part upon how well their employees learned their lessons at the Leadership Center.
QUESTIONS
1. How does the Leadership Center serve as a center for change at GE? Answer: By bringing employees ranging from entry-level to top level executives and from GE operations world-wide, GE trains leaders for the future. Though initially the center concentrated upon leadership training, the center now uses the center as a tool to spread change throughout the company. The center is at the vanguard of cutting-edge thinking in organizational development, leadership, innovation, and change. Customers of GE are also invited to the center so that they and GE employees can jointly discuss and solve major issues. By building strong leaders, GE is strategically preparing for a turbulent and challenging future. 2. Visit GEs Web site to learn about the Leadership Centers current programs at www.ge.com/ and www.ge.com/company/culture/leadership_learning.html.
pressures, they face significant challenges of maintaining the formula that helped them become successful.
MAJOR POINTS
One of Starbucks formula for success is a CEO who communicates a strong and clear vision to their employees. The philosophy of Leave no one behind shows up in training, salaries, and benefit packages. Employees consistently rate Starbucks as one of the best companies to work for. Employee surveys found that the two principal reasons people work for Starbucks are opportunities to work with an enthusiastic team and to work in a place where they feel they have value. Starbucks looks for people who are adaptable, self-motivated, passionate, and creative team players. With a company of over 170,000 world-wide employees, maintaining an entrepreneurial spirit is a major objective. With increasing competition and challenging economic conditions, Starbucks is striving to create both value and quality while maintaining the precepts that made it successful.
QUESTIONS
1. What do you think Schultz meant when he said that Starbucks objective is Getting big and staying small? Answer: Schultz is likely trying to maintain the entrepreneurial spirit of Starbucks when they were a small and growing company. With a more mature company of around 170,000 employees, the challenge is not to allow the company to loose the culture that helped it become successful. 2. If possible, interview a present or former employee of Starbucks to get his or her impression of the company. 3. If you have visited a Starbucks, did you see any examples of teamwork among its employees? 4. Research the current lists of Fortunes 100 Best Companies to Work For and Americas Most Admired Companies. Information is available at www.money.cnn.com/magazines/fortune/fortune_archive/. 5. Research current information about Starbucks sales and revenue. Information and their annual report can be found at www.starbucks.com/.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
Review Questions
1. How would you define organization development?
Answer: Organization development is a series of planned behavioral science intervention activities with the purpose of increasing the effectiveness of the system and developing the potential of all individual members. OD efforts are planned, systematic approaches to change that are carried out in collaboration with organization members to help find improved ways of working together toward individual and organizational goals.
2.
Answer: OD represents a systems approach that is concerned with the interrelationship of various divisions, departments, groups, and individuals as interdependent subsystems of the total organization. A single technique such as management training is aimed at changing individual behavior, whereas OD is focused on the larger goal of developing an organization-wide improvement in managerial style. OD uses many different techniques and no single technique represents the OD discipline.
3.
Answer: Psychological contract involves the expectations on the part of individuals and organizations to which they belong or in which they take part (i.e., work). Each side must understand that such a contract exists and that unless these expectations are met, there will be conflict.
4.
Answer: Pivotal norms are essential to accomplishing the organizations objectives. Peripheral norms support and contribute to the pivotal norms but are not essential to the organizations objectives.
5.
Answer: Socialization is the process that adapts employees to the organizations culture. An individual may respond to the socialization in three basic ways. At one extreme, an individual may conform to all the norms of the organization, resulting in uniformity of behavior and complete acceptance of organization values. At the other extreme, an individual may rebel, reject all values, or leave the organization altogether. Another alternative between the two previous extremes is for an individual to accept the pivotal norms and seriously question the peripheral norms, which is called creative individualism.
6. 7.
Read a book or an article and identify the organizational culture and norms it embodies. Identify and explain the five stages of organization development.
Answer: Stage one is to anticipate a need for change. People in the organization perceive that the organization is in a state of disequilibrium or n eeds improvement. In stage
two, relations between the practitioner and organization members (the client)
8 Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
develop. The practitioner attempts to establish a pattern of open communication, a relationship of trust, and an atmosphere of shared responsibility. Stage three is the diagnostic phase where the practitioner and client gather data and analyze the data to identify problem areas and causal relationships. In stage four action plans, strategies, and techniques are developed to resolve problems and increase organization effectiveness. The plans and techniques include total quality management (TQM), job design, role analysis, goal setting, team building, and intergroup development. Stage five, the last stage, is a period of self-renewal, monitoring, and stabilizing the OD program. In this stage the change program is monitored to make sure that the new behavior is stabilized and internalized. If this is not done, the tendency is for the system to regress to previous ineffective modes or states. The client system needs to develop the capability to maintain innovation without outside support.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
ADDITIONAL RESOURCES
Readings:
Beckhard, Richard, Organizational Development: Strategies and Models (Reading, Mass.: Addison-Wesley Publishing Co., Inc., 1969.) If you have difficulty locating this classic OD book, you might try amazon.com and ebay.com. Beckhard, Richard, Agent of Change: My Life, My Practice (San Francisco: Jossey-Bass, 1997.) Bennis, Warren G., Organization Development: Its Nature, Origins, and Prospects (Reading, Mass.: Addison-Wesley Publishing Co., Inc., 1969.) This Bennis and the Beckhard book are part of an Addison-Wesley OD series published in the late 1960s. Bennis, Warren G., The Essential Bennis (San Francisco: Jossey-Bass, 2009.) Schein, Edgar, Organizational Culture and Leadership (San Francisco: Jossey-Bass, 2004.) Tichy, Noel. M. and S. Sherman, Control Your Destiny or Someone Else Will (New York: HarperBusiness, 2001.)
Video:
The Target Shoots First, 2000, 70 minutes, documentary. Directed, written, produced, and filmed by the lead character, Christopher Wilcha. 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. This film was shown on the Sundance TV channel. It may have become available. This is a good film to lead off the semester. Additional information is available at http://www.imdb.com. The film is also appropriate for Chapters 3 and 16.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
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SIMULATION PROCEDURES
Simulation 1.1 (p. 19) Auditioning For The Saturday Night Live Guest Host Spot
1. Student premeeting preparation: None.
2. Introduction:
a. Here we want to set a norm of participation, fun, and positive feedback.
3. Suggestions:
a. After a brief introduction, we begin sharing information about ourselves. b. A potential problem is one of class size, as it requires about five minutes per person for the introduction.
4. Discussion points:
a. What norms have emerged? b. Did you learn more about the interviewer or the interviewee? c. Do you feel more comfortable with the class?
Notes
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Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
2. Suggestions:
a. If possible, the class should be seated in a circle. How you handle the questions will help to determine the development of the course. Students are sometimes hesitant to ask meaningful questions and, at other times, to bring out serious issues as a test of how you will respond. Anything you can do to handle these issues openly will have a long-term payoff. b. The issues that are likely to emerge, or that you may want to present, are those of preclass preparation, exams, and grading. A critical problem for courses of this type is premeeting preparation. Sometimes students are under pressure in more structured courses and feel they can let this course-work slide. The timing of the simulations is such that when people fail to do the prework, it slows and delays the class and degrades the learning process. You very likely, on the other hand, will not feel comfortable in the role of police person (checking on homework), so this issue needs to be confronted. c. At this point, students are usually emphatic about two things: they dont like exams and they dont like to write papers. How you deal with these issues may well be a factor in your student / professor relationship. We leave the options open to the class, but explain the position of the previous class and that the simulations are important to learning. The prework is left up to the class, but it has never posed a serious problem.
3. Discussion points:
a. b. c. d. Expectations. Roles. Goals and rewards. Grades.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
Notes
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Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
II. Causes
1. Rapid growth. 2. A degree of immaturity from some employees.
III. Alternatives
1. Maintain status quo. 2. Still have TGIF parties but dont serve beer or other alcoholic beverages. a. Explain the legal problem very openly to employees. b. Introduce alternatives such as better food as a replacement for beer. c. Have team sports such as softball or volley ball. 3. Use no-host bar. a. This will likely not remove legal responsibility. b. Might be seen as being cheap by the employees. 4. Use designated driver or company bus. 5. Explain the problem to employees and ask for suggestions.
IV. Recommendations
Remove the alcohol from the parties. The legal responsibilities are too great a risk. A combination of alternatives 2 and 5. Ask for suggestions as to a replacement for the alcohol.
Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall
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Chapter 1 Organization Development and Reinventing the Organization Copyright 2011 Pearson Education, Inc. Publishing as Prentice Hall