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15. C H A P T E R. Organizational Change and Development. F I F T E E N. Continuous Change at Nokia. Nokia has continually adapted to its changing environment. The Finnish company began as a pulp and paper mill in 1865, then moved. Courtesy National Board of Antiquities, Finland.

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organizational change and development

15

C H A P T E R

Organizational Change and Development

F I F T E E N

continuous change at nokia
Continuous Change at Nokia

Nokia has continually adapted to its changing environment. The Finnish company began as a pulp and paper mill in 1865, then moved

Courtesy National Board of Antiquities, Finland

into rubber, cable wiring, and computer monitors. In the 1980s, Nokia executives sensed an emerging market for wireless communication. Today, Nokia is a world leader in cellular telephones.

slide3

0 10 20 30 40 50 60 70 80

Hungary

Mexico

S. Korea

Germany

United States

Japan

0 10 20 30 40 50 60 70 80

Organizational Change: An International Phenomenon

International

expansion

Reduction in

employment

Mergers,

divestitures,

acquisitions

Major

restructuring

(Source: Kanten, R., 1991.)

Percentage of Respondents by Country

slide4

Changing People: Some Basic Steps

Incorporating the changes,

creating and maintaining a

new organizational system

Step 3: Refreezing

Attempting to

create a new state

of affairs

Step 2: Changing

Current State New State

Recognizing the

need for change

Step 1: Unfreezing

slide5

Sensitivity

groups

Objective

data

Group members

recognize problem

Diagnose group’s

strengths and

weaknesses

Team Building: Its Basic Steps

Develop desired

change goals

Restart process

Develop action plan

to make changes

Implement plan

Evaluate plan

if unsuccessful

if successful

Process

completed

slide6

When Will It Occur?

Change

is made

If benefits exceed costs

Amount of dissatisfaction

with current conditions

Compared

to

Cost of

making

change

Benefit of

making

change

Availability of a

desirable alternative

Existence of a plan for

achieving a desirable

alternative

Change is

not made

If costs exceed benefits

some external forces for change
Some External Forces for Change

Information

Technology

Globalization

& Competition

Courtesy National Board of Antiquities, Finland

Demography

force field analysis

Restraining

Forces

Driving

Forces

Restraining

Forces

Restraining

Forces

Driving

Forces

Driving

Forces

Force Field Analysis

Desired

Conditions

Current

Conditions

BeforeChange

AfterChange

DuringChange

resistance to change at bp norge
Resistance to Change at BP Norge

Employees initially resisted self-directed teams BP Norge’s North Sea drilling rigs.

  • “SDWTs don’t work on drilling rigs!”
  • “We already have teams!”
  • “This creates more work — will we get higher pay?”
  • “I don’t know how to work in teams.”
  • “SDWTs will threaten my job as a supervisor!”

AP Worldwide

resistance to change
Resistance to Change

Direct Costs

Saving Face

Fear of the Unknown

Breaking Routines

Incongruent Systems

Incongruent Team Dynamics

Forces for

Change

creating an urgency for change
Creating an Urgency for Change
  • Need to motivate employees to change
  • Most difficult when organisation is doing well
  • Must be real, not contrived
  • Customer-driven change
    • Adverse consequences for firm
    • Human element energizes employees
minimizing resistance to change
Minimizing Resistance to Change

Communication

Minimizing

Resistance

toChange

Coercion

Training

Negotiation

Employee

Involvement

Stress

Management

refreezing the desired conditions
Refreezing the Desired Conditions

Creating organizational systems and team dynamics to reinforce desired changes

  • alter rewards to reinforce new behaviours
  • new information systems guide new behaviours
  • recalibrate and introduce feedback systems to focus on new priorities
change agents
Change Agents
  • Anyone who possesses enough knowledge and power to guide and facilitate the change effort
  • Change agents apply transformational leadership
    • Help develop a vision
    • Communicate the vision
    • Act consistently with the vision
    • Build commitment to the vision

Courtesy of CHC Helicopter Corp.

successfully diffusing change
Successfully Diffusing Change
  • Successful pilot study
  • Favourable publicity
  • Top management support
  • Labour union involvement
  • Diffusion strategy described well
  • Pilot program people moved around

Courtesy of CHC Helicopter Corp.

organization development defined
Organization Development Defined

A planned system wide effort, managed from the top with the assistance of a change agent, that uses behavioural science knowledge to improve organizational effectiveness.

slide17

Organizational Development: How Effective Is It?

Organizational outcomes

more often benefited from

OD interventions than did

individual outcomes

(48.70)

50

40

30

(23.55)

Percentage of Studies Showing Positive Changes

20

Individual

outcomes

(e.g., job

satisfaction)

Organizational

outcomes

(e.g., profit)

(Source: Porras and Robertson, 1992.)

action research process

Introduce

Change

Evaluate/

Stabilize

Change

Action Research Process

Establish

Client-

Consultant

Relations

Diagnose

Need for

Change

Disengage

Consultant’s

Services

parallel structures
Parallel Structures

Parallel

Structure

Organization

appreciative inquiry process

Delivering

Developing objectives about “what will be”

Discovery

Dreaming

Designing

Discovering the best of “what is”

Forming ideas about “what might be”

Engaging in dialogue about “what should be”

Appreciative Inquiry Process
organization development concerns
Organization Development Concerns
  • Cross-Cultural Concerns
    • Linear and open conflict assumptions different from values in some cultures
  • Ethical Concerns
    • Management power
    • Employee privacy rights
    • Employee self-esteem
    • Consultant’s role
slide22

The Ethics of OD:Summary of the Debate

  • OD is
  • ethical
  • The imposition of values
  • is an inherent part of life,
  • especially on the job
  • Abuse comes from
  • individuals, not from
  • the technique itself,
  • which is neither good
  • nor evil
  • OD is
  • unethical
  • Imposes values of the
  • organization; coercive
  • and manipulative
  • Potential for abuse
scenario 1 greener telco
Scenario #1: “Greener Telco”

Scenario #1 refers to Bell Canada’s Zero Waste program, which successfully changed wasteful employee behaviours by altering the causes of those behaviours.

Courtesy of Bell Canada

bell canada s change strategy
Bell Canada’s Change Strategy

Relied on the MARS model to alter behaviour:

Motivation -- employee involvement, respected steering committee

Ability -- taught paper reduction, email, food disposal

Role perc. -- communicated importance of reducing waste

Situation -- Created barriers to wasteful behaviour, eg. removed garbage bins

Courtesy of Bell Canada

scenario 2 go forward airline
Scenario #2: “Go Forward Airline”

Scenario #2 refers to Continental Airline’s “Go Forward” change strategy, which catapulted the company “from worst to first” within a couple of years.

Courtesy of Continental Airlines

continental airlines change strategy
Continental Airlines’ Change Strategy
  • Communicate, communicate, communicate
  • Introduced 15 performance measures
  • Established stretch goals (repainting planes in 6 months)
  • Replaced 50 of 61 executives
  • Rewarded new goals (on-time arrival, stock price)
  • Customers as drivers of change

Courtesy of Continental Airlines

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