C H A P T E R

16
Organizational
Change and
Development

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Driving Change at EDS

Richard H. Dick Brown
drove the change effort at
EDS by:

listening to customer complaints

changing the firms structure

monitoring the change process

communicating the change
directly with employees

replacing several executives

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AP/ Wide World

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Some External Forces for Change

Information
Technology
Globalization
& Competition

Demography

McShane/ Von Glinow 2/e

Easier information transfer

Facilitates global structures
Requires new competencies
and expectations
Facilitates telecommuting; new
employment relationships
More emphasis on knowledge
management

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Some External Forces for Change

Information
Technology
Globalization
& Competition

Demography

McShane/ Von Glinow 2/e

Global competition
Technology makes it easier to
compete quickly
Results in restructuring,
outsourcing, mergers

produces many employment

changes

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Some External Forces for Change

Information
Technology
Globalization
& Competition

Demography

More educated workforce

want involvement; interesting work
Younger generation

less intimidated by status

want a more balanced work life
Cultural changes

more individualism in traditionally
collectivist countries

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Force Field Analysis

Restraining
Forces

Desired
Conditions
Restraining
Forces

Restraining
Forces

Current
Conditions

Driving
Forces

Driving
Forces
Driving
Forces

Before
Change
McShane/ Von Glinow 2/e

During
Change

After
Change

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Resistance to Change at BP Norge

Employees initially resisted selfdirected work teams (SDWTs) at BP
Norges North Sea drilling rigs.
We already have teams!
SDWTs dont work on rigs!
This creates more work -- we
want higher pay!
I dont know how to work in
teams.
SDWTs will threaten my job as a
supervisor!

McShane/ Von Glinow 2/e

AP/ Wide World

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Resistance to Change
Direct Costs
Saving Face
Fear of the Unknown

Forces for
Change

Breaking Routines
Incongruent Systems
Incongruent Team Dynamics

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Creating an Urgency for Change

Need to motivate employees to change
Most difficult when organization is doing well
Must be real, not contrived
Customer-driven change

Adverse consequences for firm

Human element energizes employees

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Reducing Restraining Forces at Unilever

Gary Calveley (right) brought in
team coaches to train
employees throughout the
process of changing Unilevers
Elida Faberge factory into
Europes best factory. A
theatrical production helped to
communicate the changes that
Calveley was trying to achieve
through coaching.

McShane/ Von Glinow 2/e

Dean Smith/The Camera Crew

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Minimizing Resistance to Change

Communication

Coercion

Negotiation

Training

Minimizing
Resistance
to Change

Employee
Involvement

Stress
Management

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Refreezing the Desired Conditions

Creating organizational systems and team
dynamics to reinforce desired changes

alter rewards to reinforce new behaviors

new information systems guide new behaviors

recalibrate and introduce feedback systems to
focus on new priorities

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Strategic Vision & Change Agents

Strategic Vision and Change

Need vision of desired future state

Minimizes employee fear of the unknown

Clarifies role perceptions
Change Agents

Possess knowledge and power to facilitate the
change effort

Usually internal change champion

Need to be transformational leaders

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Conditions for Diffusing Change

Successful pilot study
Favorable publicity
Top management support
Labor union involvement
Diffusion strategy described well
Pilot program people moved around

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Organization Development Defined

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

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Action Research Process

Establish
Client-Client
Consultant
Relations

Diagnose
Need for
Change

Introduce
Change

Evaluate/
Stabilize
Change
Disengage
Consultants
Services

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Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Parallel Learning Structures

Parallel Learning
Structure

McShane/ Von Glinow 2/e

Organization

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Appreciative Inquiry at Hunter Douglas

The Hunter Douglas Window
Fashions Division in Colorado
relied on appreciative inquiry as
well as a search conference to
create a collective vision, reinstill a sense of community
among employees, and build
leadership within the company.

McShane/ Von Glinow 2/e

Courtesy of Amanda Trotsen-Bloom

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

What is Appreciative Inquiry?

Directs the groups attention
away from its own problems
and focuses participants on
the groups potential and
positive elements.
Reframes relationships
around the positive rather
than being problem oriented

McShane/ Von Glinow 2/e

Courtesy of Amanda Trotsen-Bloom

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

Appreciative Inquiry Process

Discovery

Dreaming

Designing

Delivering

Discovering
the best of
what is

Forming
ideas about
what might
be

Engaging in
dialogue
about what
should be

Developing
objectives
about what
will be

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

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

Consultants role

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.

C H A P T E R

16
Organizational
Change and
Development

McShane/ Von Glinow 2/e

Copyright 2003 by The McGraw-Hill Companies, Inc. All rights reserved.