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  1. Organization ChangeResearch and Theory AJI JAYA BINTARA ALISA OCTABIYANTI DION WARDYONO

  2. Change is a choice (intend to do and not intend to do)

  3. Why the organization must change? What kind of change? How to change?

  4. The Origin of Origins Organization theory Non linear complex system theory Chaos and Related Theory Organization change Theory Psychological Theory

  5. Antecedents of Organization Development Cummings & Nathan, 1991: • Lifting of significant regulatory requirements • A new CEO charged with transformation • A technological breakthrough Tushman, Newman, and Romaneli (1986): • A Fundamental shift in an industry competitive framework • Significant movement in a product’s life cycle • Significant change in size

  6. Review of Organization change research • Approach to Organization Development (Friedlander & Brown, 1974): TARGET OF INTERVENTIONS OUTCOMES OF INTERVENTIONS Human-Processual Approach PEOPLE Human Fulfillment Organizational Processes Organizational Structures TECH-NOLOGY Task Accomplishment Techno-Structural Approach • Complementary research to Organization Development - Faucheux, Amado, & Laurent • - Identifies cross cultural view • - Stronger linkage between social and technical approach

  7. Organization change research “suffers from problem” Beer & Walton (1987) : This kind of research attempts to determine causation Most research on organization change is a snapshot, not longitudinal Much research methodology and instrumentation is quite precise, but meaning and interpretation of the data are anything but precise The research often does not fit the needs of user.

  8. Shift from “normal science” to “action science” More Recent Approaches to Research and Theory Action Science Normal Science • Involves the user in the study • Relies on self-corrective • learning (assessment and • modification) • - Occurs over time, not episodically • Linear Systems • Quantitative method • Snapshot study Argyris, Putnam & Smith (1985)

  9. Additional considerations in organization change research • The research can affect the outcome • Golembiewski, Billingsley, and Yeager (1976) : • Three types of change, which they labeled Alpha, Beta, and Gamma (Team Building example)

  10. The organizational change research theory of Porras and Colleagues • 1990 Theory and Research most closely associated with OD (Organizational Development) • Porras & Robertson, 1992 Planned VS unplanned change, First-order VS Second-order change. • Planned Change: Deliberate, Conscious, improve, deeper • Unplanned Change: External, Response, adaptive, spontaneous • First-Order Change: Continuous, Alterations, Modifications • Second-Order Change: Radical, Fundamental, Paradigmatic

  11. Types of Organizational ChangeOrganizational Development: Theory, Practice, and Research, by J. I. Porras and P. J. Robertson, 1992, in Handbook of Industial and Organizational Psychology, by M. D. Dunnette and L. M. Hough Comments: • It oversimplifies. Revolutionary changes and evolutionary changes can be planned (Goodstein & Burke, 1991) & (Chapter 5) • The most recent review, Weick and Quinn (1999) Episodic Change (discontinuous, transformational, and revolutionary) VS Continuous Change (continuous, improvement, transactional, and evolutionary).

  12. Organization Models Friedlander & Brown (1974) two primary approaches to organization change: • People or Human-processual • Technology or Techo-structural Two outcomes: • Human Fulfillment • Task Accomplishment Porras (1987) loop connecting process • Environment (input) • Organization (through-put) • Organizational Performance, and individual development (Output) Porras & Robertson (1992); Porras & Silvers (1991) Four organizational work settings dimensions “streams”: • Organizing Arrangements (goals, strategies, structure, and systems) • Social Factors (culture, social pattern, networks, individual attributes • Technology (tools, equipment, machinery, job design, and technical systems) • Physical Settings (space, ambiance, interior design, etc). And the member elements: • Cognitions • Behaviors

  13. A Change-Based Organizational FrameworkHandbook of Industrial & Organizational Psychology, by Marvin D. Dunnette and Leaetta M, Hough, 1992 Environment Vision Worksetting Worksetting Physical setting Organizing arrangements Technology Social factors Organization Organization Individual Cognition Members Members On-The-Job Behavior Organization Organizational performance Individual development

  14. Organization Change Theory Whetten (1989) a “complete” theory contains four elements: • What (constructs): “explanatory parts” • How (lingkages): “what causes what” • Why (conceptual assumptions): “the reasonableness” • Who, Where, When (The fourth element ): “temporal & contextual factors of generalizability” Porras and Silvers (1991): “Planned change that makes organizations more responsive to environmental shifts should be guided by generally accepted and unified theories of organizations and organizational change, neither of which currently exists” (p 51) Proposes new model a process of how organizational change occurs: • Organizational Interventions (OD and OT) that are intended to affect • Certain Variables (Vision and Worksetting) which in turn affect • Individual (Cognitive and Behavior)and ultimately improve • Organizational Outcomes (Organizational Performance and Individual Development

  15. Planned Process Model of Organization Change Organization Development and Transformation, by J. I. Porras and R. C. Silvers, 1991 ORGANIZATIONAL TARGET VARIABLES INDIVIDUAL ORGANIZATIONAL MEMBER CHANGE INTERVENTION ORGANIZATIONAL OUTCOMES C O G N I T I V E C H A N G E Alpha Change • VISION • Guiding Bullets and Principles • Purpose • Mission IMPROVED ORGANIZATIONAL PERFORMANCE ORGANIZATION TRANSFORMATION (OT) Beta Change ? BEHAVIOR CHANGE Gamma (A) Change • WORK SETTING • Organizing Arrangements • Social Factors • Technology • Physical Setting ENHANCED INDIVIDUAL DEVELOPMENT ORGANIZATION DEVELOPMENT (OD) Gamma (B) Change

  16. Comments • Porras meets Whetten’s (1989) criterias well Organization change occurs when members alter their on-the-job behavior appropriately • However: • Human Beings the more emotional, the more it is the other way around (behavior first, then cognition) • More complex organization level The social effect (how they collectively react and interact to another) • Vision not sufficient for change The change in mental set comes after behavior has occured • Supported by James-Lange Theory (emotion), Schachter 1959 (attribution came after the inducement and the enacted behavior), Wegner and Wheatley 1999 (behavior causes are rarely conscious intricate mechanisms in brains), Bargh & Chartrand 1999 (Automaticity Most of the causes is nonconsious means). • Added from journal Lawrence G. Hrebiniak, 2006 “Obstacles to Effective Strategy Implementation” “the problem with poor performance typically is not with planning but with doing” Managing change is the main issue

  17. Summary • Wegner & Wheatly (1999) People can experience conscious will quite independent by three criterias: • Priority Thought shortly before the action (30 s) • Consistency Thought should be compatible with the action • The lack of other possible attributed causes Thought should be the only cause of action • In the context of organizational change: • We must not assume that it is primarily a conscious Once values are declared, then quickly move to action without assuming that members have made the linkages. • In more complex organization level, rely on nonlinear theories (Svyantek & Brown, 2000) Little control and difficult to sustain because of resistancy. • In organization level, use attractors Organization change as a series of “loops” initiatives and corrections.

  18. The “In-” Theoretical Model of Organization change

  19. Beyond change management perspectives Strategy Skills Structure • Carter (2008): • Strategy –Structure –Skills as important components of change initiatives • Integration between Strategy-Structure-Skills is critical in change management process, • which contains seven phases: Set up for success, Create urgency, Shape future, • Implement, Support shift, Sustain momentum, and stabilize environment.

  20. Dimensions of organization change William F. Glueck, 1969 1. Planned – Unplanned continuum 2. Size and Scope of change - Minor change (Legal agreement) - Major change (Systems: Centralized – Decentralized) 3. Level at which organization change began - Top down - Bottom up (Beginning at bottom and restructuring upward) 4. Test for effectiveness to implementation continuum - Incremental - Simultaneously 5. Element of the organization change - Knight: Product/Services, Technology, People, and Structure - Leavitt: Structural, Technological, and Human changes Planned Unplanned

  21. Recent thinking on organization change and research Weick and Quinn (1999), consider two primary categories of organization change: Episodic - Infrequent, discontinuous, and intentional - Occurs during periods of divergence (when organization moving away from their equilibrium condition) - Arises as a result of inertia and inability to respond to external environment changes Continuous - Ongoing, evolving, and cumulative - Small continuous adjustments can cumulate and create substantial change - Driven by alertness and the inability of organization to remain stable

  22. Pendulum Swing Professional School • Social system of management • Practitioners • managers • Business • Trade association • Management societies • Social system of science • Scientists • Graduate School • Research institute • Scholarly societies Pendulum Professional Learning Community Management Consulting Pure Science • Simon (1976): Mixing oil and water. “It’s easy to describe the intended product, less easy to • produce it. And task is not finished when the goal has been achieved”. • Different kind of knowledge: Applied knowledge (practical issues or needs of profession) and • Scientific knowledge (new ideas and processes that are potentially possible)

  23. Individual challenge of professional services Conceptual Model To make significant research contributions , scholars in professional school must: Confront questions and anomalies arising from management profession Develop alternatives theories and undertake research to examine these questions Translate their findings, not only to contribute knowledge to a scientific discipline, but also advance to practice of management Theory Building Problem Formulation Theory Reality Research design & Conduct Problem Solving Solution General systems approach suggests, four core activities: Diagnose the problem or situation as it exists in the real world Select a conceptual model and a research question to deal with problem or situation Build a theory and design research to examine the research questions Conduct the research and analyze the findings to produce a solution that addresses the real world problem or situation

  24. A Theory of Action Perspective • The basic premises of this perspective are: • At the core of human and organizational life is effective action • Actions are produced by individuals using their mind/brain • The way the mind/brain produces actions is to use designs that are stored in and retrievable from the human mind/brain • The design are causal • The design that are actionable must also be testable, or else we can never addresses our effectiveness • Individual hold designs that they espouse and designs that they actually use. The key to change is to get at the designs in use or theories in use

  25. The Van de Ven & Argyris Arguments • Van de Ven and Argyris differ in: What knowledge to be developed and How it should be developed • Van de Ven arguments: 1. Research must contribute to scientific discipline and practice of management 2. Business school must create an environment that integrated the discipline by making dialogue or communication • Argyris arguments: 1. Academics must ground research questions & solutions in real world practices 2. Academic recommendations cannot be implemented effectively unless, without take to human tendency to behave consistently and defend against leading consistently

  26. How environment stimuli affects the organization or human being ENVIRONMENT STIMULI ORGANIZATION (STRUCTURAL) HUMAN RELATED (BEHAVIORAL)

  27. Our Synthesis Q1: When doesorganization development and organization transformation occur in organization planned change? Q2: When doestop-down initiative and bottom-up initiative occur in organization planned change? Q3: When does cognition change and behavior change occur in organization planned change? A: It depends on the difference of organization’s and members’ sensitivityin responding the change issue which is caused by: • The Type of External Stimuli (Macro: PESTEL and Micro: Industry) • The Type of Internal Stimuli (Organization and Individual readiness: way of thinking, needs, interests, etc.) • The Timing of Stimuli to occur (Surprising or Predicted)

  28. Our Synthesis H1:Organization transformation occurs when there is a high sensitivity in responding the change issue. H2: Organization development occurs when there is only a low sensitivity in responding the change issue. H3: Status quo occurs when there is no sensitivity in responding the change issue. H4: Top-down initiative occurs when organization’s sensitivity is higher than members’ in responding the change issue. H5: Bottom-up initiative occurs when members’ sensitivity is higher than organization’s in responding the change issue. H6: Two-ways initiative occurs when there is an equal level of sensitivity between organization and members in responding the change issue. H7: Cognition change occurs before behavior change when there is a small gap of sensitivity between organization and members in responding the change issue (high and low, low and resistance). H8: Behavior change occurs before cognition change when there is a huge gapof sensitivity between organization and members in responding the change issue (high and resistance). H9: Cognition change and behavior change occurs simultaneously when there is an equal level of sensitivity between organization and members in responding the change issue.