Organization Development Professor Alexandre Ardichvili Module 3 Topics

Organization Development Professor Alexandre Ardichvili Module 3

Topics and Activities for Session 3 • Definition of Organization Development (OD) • OD and planned change models vs. other forms of organization change • Roots of OD • Introduction to the planned change model (action research model) • Types of OD interventions • Case study • Video cases 1 -2

Burke’s Definition of OD OD is a planned process of change in an organization’s culture through the utilization of behavioral science technology, research, and theory. Cummings & Worley 9 e, (c) 2008 South-Western/Cengage Learning 1 -3

Beckhard’s Definition of OD OD is an effort (1) planned, (2) organization -wide, and (3) managed from the top, to (4) increase organization effectiveness and health through (5) planned interventions in the organization’s “processes, ” using behavioral science knowledge. Cummings & Worley 9 e, (c) 2008 South-Western/Cengage Learning 1 -4

Discuss: • What is OD? Provide your definition • Is OD practiced in Brazilian organizations? Can you share any examples?

Organization Development is defined as • • the system-wide application and transfer of behavioral science knowledge to the planned development, improvement, and change of strategies, structures, and processes • that lead to organizational effectiveness (Cummings & Worley, 2009)

Human Process Interventions Technostructural Interventions Interpersonal & Group Process Approaches Restructuring Organizations Organization Process Approaches Employee Involvement Work Design Human Resources Management Interventions Strategic Interventions Transformational Change Performance Management Continuous Change Developing Talent Managing Workforce Diversity & Wellness Transorganizational Change Special Topics in Organization Development in Global Settings Cummings & Worley 9 e, (c) 2008 South-Western/Cengage Learning OD in Nonindustrial Settings Future Directions in OD 1 -7

Models of Planned Change • Lewin’s Model (Unfreeze, Move, Refreeze) • Positive Model • Action Research Model

Lewin’s Change Model Unfreezing Movement Refreezing Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 2 -9

Action Research Model Problem Identification Consultation with a behavioral scientist Joint diagnosis Joint action planning Data gathering & preliminary diagnosis Feedback to Client Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning Action Data gathering after action 2 -10

Positive Model Initiate the Inquiry Inquire into Best Practices Discover Themes Envision a Preferred Future Design and Deliver Ways to Create the Future Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 2 -11

General Model of Planned Change Entering and Contracting Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning Diagnosing Planning and Implementing Change 2 -12 Evaluating and Institutionalizing Change

Mc. Gregor’s Theory X & Theory Y Theory X: Managers assume that people: • Have a genuine distaste for work; Therefore: Must be prodded, coerced or threatened into work • Prefer to be closely supervised; Avoid as much responsibility as they can • Have little ambition; Value security above all else Theory Y: Leaders assume that people: • Want to work • Will exercise self-control if they are committed to the results • Will be motivated to achieve goals if they value the outcomes to be achieved • Have imagination & creativity (these are not traits reserved for those in leadership positions) • Are capable of realizing more potential than are typically given

The Organization Development Practitioner • Internal and External Consultants • Professionals from other disciplines who apply OD practices (e. g. , TQM managers, IT/IS managers, compensation and benefits managers) • Managers and Administrators who apply OD from their line or staff positions Cummings & Worley, 9 e (c) 2008 South-Western Cengage Learning 3 -14

Competencies of an OD Practitioner • Intrapersonal skills – Self-awareness • Interpersonal skills – Ability to work with others and groups • General consultation skills – Ability to manage consulting process • Organization development theory – Knowledge of change processes • Business knowledge • Research methods Cummings & Worley, 9 e (c) 2008 South-Western Cengage Learning 3 -15

Flawless Consulting (Peter Block) • • Partnering with clients Developing commitment for change Acting authentically Trusting yourself and your experience

Action Research Model Entry Start-up Adoption Assessment and Feedback Separation Action Planning and Change Management Evaluation Intervention

Entry • Take 3 minutes to write down answers to these questions: • What are the important activities on the entry stage? • What are some important issues to be mindful of at this stage? • Share your thoughts with the large group.

The Entry Process • Clarifying the Organizational Issue – Presenting Problem – Symptoms • Determining the Relevant Client – Working power and authority – Multiple clients – Specify the mission for the project Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 4 -19

Interpersonal Issues of Entry • Client Issues – Exposed and Vulnerable – Inadequate – Fear of losing control • OD Practitioner Issues – Empathy – Worthiness and Competency – Dependency – Over identification Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 4 -20

Types of Clients • Contact clients: approach the consultant initially • Intermediate clients: get involved in early meetings, provide some information • Primary clients: own a problem for which they need help • Ultimate clients: may or may not be directly involved with the consultant, but their welfare and interests must be considered in planning the interventions Shein (1988)

Proposal: Questions to Consider • • What is the organization after? How deep does the problem go? How many people & levels will be touched? What kind of organizational culture exists? Who are the decision makers? Are there differences of opinion in the firm? Has the firm used consultants in the past?

Starting an Action Research Project • • • Begins when contract is signed Building working relationships Becoming oriented to client’s world Complete preliminary diagnostic scan Develop project plan

Information Gathering and Analysis • Brainstorm a list of all things you need to know about the problem (Q: What information would you need to collect in the Falcon case? ) • Prioritize the list (Use the Pareto rule: 80/20) • Think how you can collect data about the things you need to know (Falcon Case)

Information gathering: find the real problem and facts • Literature search: published company and industry information; government sources • Document review: – Internally generated: mission statements and related materials, financial statements, org. charts, operating plans, operating manuals and procedures books, job task analysis reports, safety procedures handbooks – Externally generated: banks, auditors, government offices (OSHA, EPA, etc. ), but circulated within the company

Information gathering (cont. ) • Interviews: – internal personnel directly and indirectly related to project, – internal personnel unrelated to project, but who may have insights into it, – external stakeholders: customers, suppliers, investors • Surveys: internal and/or external stakeholders; standardized or created by you • Direct observation • Other, non-related information

Analysis Qualitative and quantitative Qualitative--content analysis : - comparing individual answers to the same question - thematic analysis: identify common themes Quantitative: statistical analysis of survey results. Caution: are the “significant” topics really significant? Use the Pareto principle in your analysis Develop sketches, cause-effect diagrams, and flow charts to analyze the situation Ask: why? why?

Techniques for Analyzing Data • Qualitative –Content Analysis –Force-Field Analysis • Quantitative –Descriptive statistics –Correlations –Differences between groups

Force-Field Analysis of Work Group Performance Forces for Change Competition from other groups Supervisor pressures Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning Group performance norms Fear of change Member complacency Well-learned skills 7 -29 Desired Performance Better raw materials Current Performance New technology Forces for Status Quo

Organizational Diagnosis • Three levels: – organization-wide – group – individual job • Using systems thinking – Inputs – Design Components (Process/Transformation) – Outputs

Organization Level Diagnosis • Inputs – External environment – Industry Structure • Design Component: Strategic Orientation – Strategy (Mission, Goals/Objectives, Intent/Policies) – Organization Design (Core Activities, Structure, Measurement, HR, Culture) • Outputs – Org. Performance – Productivity – Stakeholder Satisfaction

Organization-Level Diagnostic Model Inputs Outputs Design Components Technology Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning HR Systems Structure Measurement Systems 5 -32 Culture Industry Structure Strategy Organization Effectiveness General Environment

Key Alignment Questions • Do the Design Components fit with the Inputs? • Are the Design Components internally consistent? Do they fit and mutually support each other? Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 5 -33

Organization Design Components • Strategy – the way an organization uses its resources (human, economic, or technical) to gain and sustain a competitive advantage • Technology – the way an organization converts inputs into products and services • Structure – how attention and resources are focused on task accomplishment Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 5 -34

Organization Design Components • Human Resource Systems – the mechanisms for selecting, developing, appraising, and rewarding organization members • Measurement Systems – methods of gathering, assessing, and disseminating information on the activities of groups and individuals in organizations Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 5 -35

Outputs • Organization Performance – e. g. , profits, profitability, stock price • Productivity – e. g. , cost/employee, cost/unit, error rates, quality • Stakeholder Satisfaction – market share, employee satisfaction, regulation compliance Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 5 -36

Alignment • Diagnosis involves understanding each of the parts in the model and then assessing how the elements of the strategic orientation align with each other and with the inputs. • Organization effectiveness is likely to be high when there is good alignment. Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 5 -37

Group-Level Diagnostic Model Inputs Design Components Outputs Goal Clarity Organization Design Task Structure Group Composition Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning Group Functioning Performance Norms 6 -38 Group Effectiveness

Group-level Diagnosis • Inputs – Organization Design • Design Components – Goal Clarity, Task Structure, Group Composition, Group Norms, Team Functioning • Outputs – Team Effectiveness, as measured by: Quality decisions, productivity, team cohesiveness, etc.

Group-Level Design Components • Goal Clarity – extent to which group understands its objectives • Task Structure – the way the group’s work is designed • Team Functioning – the quality of group dynamics among members • Group Composition – the characteristics of group members • Performance Norms – the unwritten rules that govern behavior Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 6 -40

Group-Level Outputs • Product or Service Quality • Productivity – e. g. , cost/member, number of decisions • Team Cohesiveness – e. g. , commitment to group and organization • Work Satisfaction Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 6 -41

Job-level Diagnosis • Inputs – Org. Design, Group Design, Personal Characteristics • Design Components – Skill variety, task identity, task significance, autonomy, feedback about results • Outputs – Individual effectiveness, as measured by: performance, absenteeism, job satisfaction, personal development, etc.

Individual-Level Diagnostic Model Inputs Organization Design Group Design Personal Traits Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning Design Components Outputs Skill Variety Task Identity Task Significance Autonomy Feedback about Results 6 -43 Individual Effectiveness

Individual-Level Design Components • Skill Variety – The range of activities and abilities required for task completion • Task Identity – The ability to see a “whole” piece of work • Task Significance – The impact of work on others • Autonomy – The amount of freedom and discretion • Feedback about Results – Knowledge of task performance outcomes Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 6 -44

Individual-Level Outputs • Performance – e. g. , cost/unit, service/product quality • Absenteeism • Job Satisfaction – e. g. , internal motivation • Personal Development – e. g. , growth in skills, knowledge, and self Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 6 -45

Data Feedback • Purpose of Feedback – create energy – direct energy – turn energy into action

Possible Effects of Feedback occurs No Change NO Energy to deny or fight data Anxiety, resistance, no change Is the energy created by the feedback? Energy to use data to identify and solve problems YES What is the direction of the feedback? Failure, frustration, no change NO Do structures and processes turn energy into action? YES Change Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning 8 -47

Determining the Content of Feedback • Relevant • Understandable • Descriptive • Verifiable • Timely Cummings & Worley, 9 e (c) 2008 South-Western/Cengage Learning • Limited • Significant • Comparative • Unfinalized 8 -48

Kirkpatrick’s Levels of Evaluation 1. Reactions. (At point 3 mostly). "Reaction may best be defined as how well the trainees liked a particular training program. " (Kirkpatrick, 1959) 2. Learning. (At points 1, 2, 3) "What principles, facts, and techniques were understood and absorbed by the conferees? “ (Kirkpatrick, 1960)

Kirkpatrick’s Levels of Evaluation 3. Behavior. Changes in on-the-job behavior. (No formal definition). (At point 4). 4. Results. "Reduction of costs; reduction of turnover and absenteeism; reduction of grievances; increase in quality and quantity or production; or improved morale which, it is hoped, will lead to some of the previously stated results. " (Kirkpatrick, 1959). (At point 4).

Questions to Ask at Each of the Levels Level 1 (Reaction): Were the participants pleased? What do they plan to do with what they learned? Level 2 (Learning): What skills, knowledge, or attitudes have changed? By how much? Level 3 (Behavior): Did the participants change their behavior based on what was learned in the program? Level 4 (Results): Did the change in behavior positively affect the organization?

Organization Change

Learning Objectives • To understand the elements of a successful change program • To understand the role of an OD practitioner in a change program • To understand the process of institutionalizing OD interventions and the factors that contribute to it

OD Practitioner’s Role Three minute paper Write down: • What are some major change management activities? • What can an OD practitioner do to help an organization implement a change initiative?

Change Management Activities Motivating Change Creating Vision Developing Political Support Managing the Transition Sustaining Momentum Effective Change Management

John Kotter, Harvard

Motivating Change • Creating Readiness for Change – Sensitize the organization to pressures for change – Identify gaps between actual and desired states – Convey credible positive expectations for change • Overcoming Resistance to Change – Provide empathy and support – Communicate – Involve members in planning and decision making

Creating a Vision • Discover and Describe the Organization’s Core Ideology – What are the core values that inform members? – What is the organization’s core purpose or reason for being? • Construct the Envisioned Future – What are the bold and valued outcomes? – What is the desired future state?

Developing Political Support • Assess Change Agent Power • Identify Key Stakeholders • Influence Stakeholders

Managing the Transition • Activity Planning – What’s the “roadmap” for change? • Commitment Planning – Who’s support is needed, where do they stand, and how to influence their behavior? • Change-Management Structures – What’s the appropriate arrangement of people and power to drive the change?

Change as a Transition State Current State Transition State Desired Future State

William Bridges: “Managing Transitions”

Sustaining Momentum • • • Provide Resources for Change Build a Support System for Change Agents Develop New Competencies and Skills Reinforce New Behaviors Stay the Course

Institutionalization Processes • • • Socialization Commitment Reward Allocation Diffusion Sensing and Calibration

Indicators of Institutionalization • Knowledge • Performance • Preferences • Normative Consensus • Value Consensus

OD Practitioner’s Role in Change Process What roles can OD practitioners play in change management?

OD Practitioner’s Roles • Strategy and implementation: Help the organization to manage the change process (using Kotter’s steps or other models) • Human systems: Work with employees to change their attitude towards change, provide empathy, support

OD Practitioner’s role “What do I do? I turn people’s anxiety into fear” Harry Woodward, Woodward Learning International

Definition of Anxiety (Wikipedia) “Anxiety is a generalized mood condition that can often occur without an identifiable triggering stimulus. As such, it is distinguished from fear, which is an emotional response to a perceived threat. ”

Perceptions of Change (H. Woodward) Common view: OLD More realistic View of Change: NEW Same Loss Gain LOSS – Something we used to do that we don’t do anymore. GAIN – Something we’re doing that we haven’t done before.

Context Meeting • Present the Model • List and Answer – What things are staying the same? – What things will we lose? – What things will we gain? Additional Questions: • What do we need to invent? • What are the “new rules? ” From now on we need to … • Given the change, we should consider … • We can no longer assume …