Chapter 13 Organizational Culture and Change Fundamentals of Organizational Behavior 2e Andrew J DuBrin PowerPoint Presentation by Charlie Cook Learning Objectives Present an analysis of the importance of organizational culture Present two models of the change process in organizations Describe why people resist change and how to manage such resistance Describe several strategies for bringing about organizational change Explain the nature of organization development Develop useful insights into managing change A J DuBrin, of Organizational in yourFundamentals job and career Behavior, Second Edition Copyright © 2002 by South-Western 13–2 Organizational Culture Organizational culture is a system of shared values and beliefs that influence worker behavior The Determinants of Organizational Culture  The values, administrative practices, and personality of the firm’s founder  The conscious and unconscious choices, behavior patterns, and prejudices of top-level managers  The culture of the society (its norms, values, and beliefs) in which the firm functions  The industry in which the firm competes A.J.The DuBrin, of Organizational firm’sFundamentals code of conduct Behavior, Second Edition Copyright © 2002 by South-Western 13–3 Organizational Culture Dimensions of Organizational Culture Values Organizational stories that have underlying meaning Myths Degree of stability Resource allocation and rewards Traditions, rites, and rituals Ownership culture Corporate spiritualism and organizational A J.spirituality DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–4 Organizational Culture How Workers Learn Culture  Workers learn through:  The Socialization Process – A process of coming to understand the values, norms, and customs of the organization – Perpetuates the organization by indoctrinating new workers into the ways of the organization  The Observation of Leaders – The teaching of leaders provides vital guidance to new workers through what leaders pay attention to, of Organizationalmeasure, and control A J DuBrin, Fundamentals Behavior, Second Edition Copyright © 2002 by South-Western 13–5 The Consequences and Implications of Organizational Culture Competitive Advantage and Financial Success Productivity, Quality, and Morale Organizational Culture Innovation Compatibility of Mergers and Acquisitions Person-Organization Fit Direction of Leadership Activity A J DuBrin, Fundamentals of Organizational EXHIBIT Behavior, Second Edition Copyright © 2002 by 13-1 South-Western 13–6 General Considerations About Managing Change Types of Change in Organizations  Changes in technology  Changes in organizational structure  Coworkers and customers A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–7 Models of the Change Process The Growth Curve Model  Formative phase—lack of structure, trial and error, and entrepreneurial risk taking  Normative phase—stability, maintenance, and predictability  Integrative phase—redefining the firm and choosing a new direction  Force-field theory  A organization simultaneously faces forces of change and of resistance to change A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–8 The Growth Curve Model of Organizational Change Degree of Structure High Normative Integrative Formative Low A J DuBrin, Fundamentals of Organizational Beginning EXHIBIT TIME © 2002 by Behavior, Second Edition Copyright 13-2 South-Western 13–9 Models of the Change Process (cont’d) The Unfreezing-Changing-Refreezing Model (Kurt Lewin)  Unfreezing  Reducing or eliminating resistance to change by resolving fear and feelings about letting go of the “old.”  Changing (or moving on to a new level)  Moving on to other things through active participation in the change process  Refreezing Encouraging recognition of successful change and rewarding people for A J DuBrin, Fundamentals of Organizational implementing the change  Behavior, Second Edition Copyright © 2002 by South-Western 13–10 Downsizing and Restructuring as a Change Strategy Primary reason for downsizing:  Reductions in the size of the firm that must be made to lower costs and allow the firm to become more competitive Dangers in downsizing:  Inability to capitalize on post- restructuring opportunities due to understaffing  Loss of critical human assets reduces learning of Organizational A J.organizational DuBrin, Fundamentals Behavior, Second Edition Copyright © 2002 by South-Western 13–14 Restructuring as a Change Strategy Keys to successful restructuring:  Integrate downsizing with the firm’s long-term strategies  Identify and protect high-potential employees  Decentralize and empower employees to their jobs  Redefine the positions of surviving employees  Eliminate low-value and non-value activities  Emphasize teamwork and cooperation  Define the new structure by specifying horizontal and vertical relationships  Support and train, then evaluate and reward performance A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–15 Information Technology (IT) and Organizational Change IT Effects on Organizations  Fewer middle management and coordinator positions  Increased organizational democracy through direct communications between all layers of the organization  More direct contact with customers and suppliers  Enterprise software supplanting managers and their work  Changes in nature of work itself that blurs the line between work and non-work time A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–16 Disruptive Technology and Organizational Change Ignoring technological changes (especially by smaller, more nimble competitors) in emerging markets puts a firm at a competitive disadvantage  Meeting the challenge of disruptive change: Create new organizational structures in which to develop new processes, products or services  Spin out an independent organization in which to develop new processes, products, or services  Acquire another company whose processes and values closely match the requirements for new processes, A J DuBrin, Fundamentals products, or services of Organizational  Behavior, Second Edition Copyright © 2002 by South-Western 13–17 The Transition from Carrying Out a Job and Work Organizational concerns:  Traditional job descriptions that are too rigid for the flexible work roles of today’s workers  The trend in hiring a person “to work” (seeking a better person-organization fit) rather than to fill a specific job  Attaining a match of workers’ skills to a project’s requirements  The difficulty managers will have in shifting from the traditional bureaucratic focus on fixed job descriptions to an emphasis on ever changing “work roles” for employees A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–18 Organizational Development as a Change Strategy Organizational Development  Is any strategy, method, or technique for making organizations more effective by bringing about constructive, planned change A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–19 Organizational Development Interventions Individual Level Organizational Level  Executive coaching  Total quality management (TQM)  Employee assistance programs  Grid organization development      (EAPs) Career development programs Organizational behavior modification (OB Mod) Job enrichment Wellness programs, including stress reduction Sexual harassment avoidance training  Gainsharing  Survey feedback (attitude surveys)  Action research (employees participate in implementing changes identified as needed by a consultant)  Helping an organization learn  Knowledge management A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–20 Organizational Development Interventions Small-Group Level  Team development  Cultural diversity training      (including valuing differences) Modified work schedules Brainstorming Intergroup conflict resolution Quality improvement teams Self-managing teams A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–21 A Process Model of Organization Development Preliminary Identification of a Problem Managerial Commitment Data Feedback Data Collection and Analysis Identification of Specific Problem Areas Development of Change Strategies Initiation of Behavior Evaluation A J DuBrin, Fundamentals of Organizational EXHIBIT Second Edition Copyright © 2002 by Behavior, 13-6 South-Western 13–22 Process Consultation A widely used OD intervention in which the communication pattern of an organizational unit is examined by a process consultant  Consultant’s role is to observe and raise questions challenging the status quo and define what really is happening in the unit A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–23 Large-Scale Organizational Change Purpose and process:  To accomplish a major change in the firm’s strategy and culture, also referred to as “bending the frame.”  Requires getting a critical mass of people throughout the firm committed to outcomes of the change  Signs of the need for change: Top executives micromanaging instead of delegating  A high turnover rate of employees  Ineffective communication in the organization  A compensation system that rewards people for actions unrelated to business success  Loss ofFundamentals A J DuBrin, of Organizational established business and failure acquire new business Behavior, Second Edition Copyright © 2002 by  South-Western 13–24 Total Quality Management (TQM)  Is a management system for improving performance throughout a firm by: maximizing customer satisfaction,  making continuous improvements,  and relying heavily on employee involvement   Is a fundamental change in the organization’s culture to one that includes a focus on the customer, an environment of trust and openness, formation of work teams, breaking down internal barriers, and sharing power A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–25 Six Sigma as Organizational Development Six Sigma  Is a data-driven statistically-based method for achieving near-perfect quality with an emphasis on preventing problems from occurring in the process  Features: Emphasizes motivating people to work together to achieve higher levels of productivity  Is a fusion of technical and social systems for creating a culture of quality  A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–26 Managing Change Yourself Empirical Research about Coping with Organizational Change  Having a positive self-concept and a tolerance for risk were both positively related to having a tolerance for ambiguity and positive affectivity  Optimistic people who can tolerate a lack of clarity and structural change cope well with change A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–27 Managing Change Yourself Suggestions for Coping with Change  Practice dealing with ambiguous tasks  Maintain a positive general disposition  Look for personal value (“silver lining”) embedded in a forced change  When faced with significant change, ask yourself “what if” questions  When confronting major change, force yourself to enjoy at least some small aspect of the change  Recognize that change is inevitable: Change before you have to and you will get a better deal A.J DuBrin, Fundamentals of Organizational Stop trying to be in control all the time Behavior, Second Edition Copyright © 2002 by South-Western 13–28 ... competes A.J.The DuBrin, of Organizational firm’sFundamentals code of conduct Behavior, Second Edition Copyright © 2002 by South-Western 13–3 Organizational Culture Dimensions of Organizational. .. faces forces of change and of resistance to change A J DuBrin, Fundamentals of Organizational Behavior, Second Edition Copyright © 2002 by South-Western 13–8 The Growth Curve Model of Organizational. .. Identification of Specific Problem Areas Development of Change Strategies Initiation of Behavior Evaluation A J DuBrin, Fundamentals of Organizational EXHIBIT Second Edition Copyright © 2002 by Behavior,