Total 3-part need be done
Homework part 1-
1-1.5 page answer (please check textbook or check ppt for more information to answer)
Below each Learning Objective you are to write your explanation, in your words. Your answers must be written in full college level sentences using proper structure, grammar, and no abbreviations. Your answers may not be quotes from the text or any other source. If so, you must cite them.
CH.7 Designing Interventions
1. Describe the interventions presented in the text.
2. Discuss how contingencies related to the change situation affect the design of effective organization development (OD) interventions.
3. Discuss how contingencies related to the target of change affect the design of effective OD interventions.
CH.8 Managing Change
1. Understand the five key elements of successful change management.
2. Explore the processes of change associated with each element.
CH.9 Evaluating and Institutionalizing Organization Development Interventions
1. Illustrate the research design and measurement issues associated with evaluating organization development (OD) interventions.
2. Explain the key elements in the process of institutionalizing OD interventions.
Homework part 2 (0.5-1-page answer)
Discuss the activities necessary for Sustaining Momentum when Managing Change
please check the pdf for reference. Thank you
Homework part 3 (one page answer)
Application Analysis:
Application 8.4- Transition Management in the HP – Compaq Acquisition – List and briefly describe each of the techniques used to reinforce change in this organization.
Article on next page, also, please check the pdf named CH8 for reference. Thank you
Each response must reflect the criteria and lessons in the text. Responses are not to be reflective of your personal view of the situation but, rather, criteria and lessons from the text applied accordingly. Use the terms from the text in your responses. In addition, show the number of the page from which you sourced your answer. Do not show ranges of pages. Just show the page number and not an APA citation. Failure to show the page number sourced to respond will earn zero points.
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9
Evaluating and Institutionalizi
ng
Organization Development Interventions
learning
objectives
Illustrate the research design and measurement issues associated with
evaluating organization development (OD) interventions.
Explain the key elements in the process of institutionalizing OD
interventions.
This chapter focuses on the final stage of theorganization development cycle—evaluationand institutionalization. Evaluation is con-
cerned with providing feedback to practitioners
and organization members about the progress and
impact of interventions. Such information may sug-
gest the need for further diagnosis and modification
of the change program, or it may show that the
intervention is successful. Institutionalization is a
process for maintaining a particular change for an
appropriate period of time. It ensures that the
results of successful change programs persist
over time.
Evaluation processes consider both the
implementation success of the intended intervention
and the long-term results it produces. Two key
aspects of effective evaluation are measurement
and research design. The persistence of intervention
effects is examined in a framework showing the
organization characteristics, intervention dimensions,
and processes contributing to institutionalization of
OD interventions in organizations.
9-1 Evaluating Organization Development
Interventions
Assessing OD interventions involves judgments about whether an intervention has been
implemented as intended and, if so, whether it is having desired results. Managers
investing resources in OD efforts increasingly are being held accountable for results—
being asked to justify the expenditures in terms of hard, bottom-line outcomes. More
and more, managers are asking for rigorous assessment of OD interventions and are
using the results to make important resource allocation decisions about OD, such as
whether to continue to support the change program, to modify or alter it, or to terminate
it and try something else.
Traditionally, OD evaluation has been discussed as something that occurs after the
intervention. Chapters 10 through 20, for example, present evaluative research about
the interventions after discussions of the respective change programs. That view can be
207
misleading, however. Decisions about the measurement of relevant variables and the
design of the evaluation process should be made early in the OD cycle so that evaluation
choices can be integrated with intervention decisions.
There are two distinct types of OD evaluation: one intended to guide the implemen-
tation of interventions and another to assess their overall impact. The key issues in eval-
uation are measurement and research design.
9-1a
Implementation and Evaluation Feedback
Most discussions and applications of OD evaluation imply that evaluation is something
done after intervention. It is typically argued that once the intervention is implemented,
it should be evaluated to discover whether it is producing the intended effects. For exam-
ple, it might be expected that a job enrichment program would lead to higher employee
satisfaction and performance. After implementing job enrichment, evaluation would
involve assessing whether these positive results indeed did occur. This after-
implementation view of evaluation is only partially correct. It assumes that interventions
have been implemented as intended and that the key purpose of evaluation is to assess
their effects. However, in many, if not most, organization development programs, imple-
menting interventions cannot be taken for granted.1 Most OD interventions require sig-
nificant changes in people’s behaviors and ways of thinking about organizations, but they
typically offer only broad prescriptions for how such changes are to occur. For example,
job enrichment (see Chapter 14) calls for adding discretion, variety, and meaningful
feedback to people’s jobs. Implementing such changes requires considerable learning
and experimentation as employees and managers discover how to translate these general
prescriptions into specific behaviors and procedures. This learning process involves
much trial and error and needs to be guided by information about whether behaviors
and procedures are being changed as intended.2 Consequently, we should expand our
view of evaluation to include both during-implementation assessments about if and how
well changes are actually being implemented and after-implementation evaluation of
whether they are producing expected results.
Both kinds of evaluation provide organization members with feedback about interven-
tions. Evaluation aimed at guiding implementation may be called implementation feedback,
and assessment intended to discover intervention outcomes may be called evaluation feed-
back. Figure 9.1 shows how the two kinds of feedback fit with the diagnostic and interven-
tion stages of OD. The application of OD to a particular organization starts with a
thorough diagnosis of the situation (Chapters 5 and 6), which helps identify particular
organizational problems, areas for improvement, or strengths to leverage as well as the
likely drivers underlying them. Next, from an array of possible interventions (Chapters 10
through 20), one or some set is chosen as a means of improving the organization. The
choice is based on knowledge linking interventions to diagnosis (Chapter 7) and change
management (Chapter 8).
In most cases, the chosen intervention provides only general guidelines for organiza-
tional change, leaving managers and employees with the task of translating those guide-
lines into specific behaviors and procedures. Implementation feedback informs this
process by supplying data about the different features of the intervention itself, percep-
tions of the people involved, and data about the immediate effects of the intervention.
These data, collected repeatedly and at short intervals, provide a series of snapshots
about how the intervention is progressing. Organization members can use this informa-
tion, first, to gain a clearer understanding of the intervention (the kinds of behaviors and
procedures required to implement it) and, second, to plan for the next implementation
208 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
steps. This feedback cycle might proceed for several rounds, with each round providing
members with knowledge about the intervention and ideas for the next stage of
implementation.
Once implementation feedback informs organization members that the intervention
is sufficiently in place and accepted, evaluation feedback begins. In contrast to imple-
mentation feedback, it is concerned with the overall impact of the intervention and
with whether resources should continue to be allocated to it or to other possible inter-
ventions. Evaluation feedback takes longer to gather and interpret than does implemen-
tation feedback. It typically includes a broad array of outcome measures, such as
performance, job satisfaction, productivity, and turnover. Negative results on these mea-
sures tell members either that the initial diagnosis was seriously flawed or that the wrong
intervention was chosen. Such feedback might prompt additional diagnosis and a search
for a more effective intervention. Positive results, on the other hand, tell members that
the intervention produced expected outcomes and might prompt a search for ways to
institutionalize the changes, making them a permanent part of the organization’s normal
functioning.
An example of a job enrichment intervention helps to clarify the OD stages and
feedback linkages shown in Figure 9.1. Suppose the initial diagnosis reveals that
employee performance and satisfaction are low and that jobs being overly structured
and routinized are an underlying cause of this problem. An inspection of alternative
interventions to improve productivity and satisfaction suggests that job enrichment
might be applicable for this situation. Existing job enrichment theory proposes that
increasing employee discretion, task variety, and feedback can lead to improvements in
work quality and attitudes and that this job design and outcome linkage is especially
strong for employees who have growth needs—needs for challenge, autonomy, and
development. Initial diagnosis suggests that most of the employees have high growth
FIGURE 9.1
Implementation and Evaluation Feedback
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CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 209
needs and that the existing job designs prevent the fulfillment of these needs. Therefore,
job enrichment seems particularly suited to this situation.
Managers and employees now start to translate the general prescriptions offered by
job enrichment theory into specific behaviors and procedures. At this stage, the interven-
tion is relatively broad and must be tailored to fit the specific situation. To implement
the intervention, employees might decide on the following organizational changes: job
discretion can be increased through more participatory styles of supervision; task variety
can be enhanced by allowing employees to inspect their job outputs; and feedback can be
made more meaningful by providing employees with quicker and more specific informa-
tion about their performances.
After three months of trying to implement these changes, the members use imple-
mentation feedback to see how the intervention is progressing. Questionnaires and
interviews (similar to those used in diagnosis) are administered to measure the differ-
ent features of job enrichment (discretion, variety, and feedback) and to assess employ-
ees’ reactions to and understanding of the changes. Company records are analyzed to
show the short-term effects on productivity of the intervention. The data reveal that
productivity and satisfaction have changed very little since the initial diagnosis.
Employee perceptions of job discretion and feedback also have shown negligible
change and employees seem confused about the expectations of managers, but percep-
tions of task variety have shown significant improvement. In-depth discussion and
analysis of this first round of implementation feedback help supervisors gain a better
feel for the kinds of behaviors needed to move toward a participatory leadership style.
This greater clarification of one feature of the intervention leads to a decision to
involve the supervisors in leadership training to develop the skills and knowledge
needed to lead participatively. A decision also is made to make job feedback more
meaningful by translating such data into simple bar graphs, rather than continuing to
provide voluminous statistical reports.
After these modifications have been in effect for about three months, members gather
a second round of implementation feedback to see how the intervention is progressing.
The data now show that productivity and satisfaction have moved moderately higher
than in the first round of feedback and that employee perceptions of task variety and feed-
back are both high. Employee perceptions of discretion, however, remain relatively low.
Members conclude that the variety and feedback dimensions of job enrichment are suffi-
ciently implemented but that the discretion component needs further improvement. They
decide to put more effort into supervisory training and to ask OD practitioners to provide
counseling and coaching to supervisors about their leadership styles.
After four more months, a third round of implementation feedback is sought. The
data now show that satisfaction and performance are significantly higher than in the first
round of feedback and moderately higher than in the second round. The data also show
that discretion, variety, and feedback are all high, suggesting that the job enrichment
intervention has been successfully implemented. Now evaluation feedback is used to
assess the overall effectiveness of the program.
The evaluation feedback includes all the data from the satisfaction and performance
measures used in the implementation feedback. Because both the immediate and broader
effects of the intervention are being evaluated, additional outcomes are examined, such
as employee absenteeism, maintenance costs, and reactions of other organizational units
not included in job enrichment. The full array of evaluation data might suggest that after
one year from the start of implementation, the job enrichment program is having the
expected effects and thus should be continued and made more permanent.
210 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
9-1b Measurement
Providing useful implementation and evaluation feedback involves two activities: select-
ing the appropriate variables and designing good measures of them.
Selecting Appropriate Variables Ideally, the variables measured in OD evaluation
should derive from the theory or conceptual model underlying the intervention. The
model should incorporate the key features of the intervention as well as its expected
results. The general diagnostic models described in Chapter 5 meet this criterion, as do
the more specific models introduced in Chapters 10 through 20. For example, the job-
level diagnostic model described in Chapter 5 proposes several major features of work:
task variety, feedback, and autonomy. The theory argues that high levels of these ele-
ments can be expected to result in high levels of work quality and satisfaction. In addi-
tion, as we shall see in Chapter 14, the strength of this relationship varies with the degree
of employee growth needs: the higher the need, the more that job enrichment produces
positive results.
The job-level diagnostic model suggests a number of measurement variables for
implementation and evaluation feedback. Whether the intervention is being implemen-
ted could be assessed by determining how many job descriptions have been rewritten to
include more responsibility or how many organization members have received cross-
training in other job skills. Evaluation of the immediate and long-term impact of job
enrichment would include measures of employee performance and satisfaction over
time. Again, these measures would likely be included in the initial diagnosis, when the
company’s problems or areas for improvement are discovered.
Measuring both intervention and outcome variables is necessary for implementation
and evaluation feedback. Unfortunately, there has been a tendency in OD to measure
only outcome variables while neglecting intervention variables altogether.3 It generally
is assumed that the intervention has been implemented, and attention, therefore, is
directed to its impact on such organizational outcomes as performance, absenteeism,
and satisfaction. As argued earlier, implementing OD interventions generally takes con-
siderable time and learning. It must be empirically determined that the intervention has
been implemented; it cannot simply be assumed. Implementation feedback serves this
purpose, guiding the implementation process and helping to interpret outcome data.
Outcome measures are ambiguous without knowledge of how well the intervention has
been implemented. For example, a negligible change in measures of performance and
satisfaction could mean that the wrong intervention has been chosen, that the correct
intervention has not been implemented effectively, or that the wrong variables have
been measured. Measurement of the intervention variables helps determine the correct
interpretation of outcome measures.
As suggested above, the selection of intervention variables to be measured should
derive from the conceptual framework underlying the OD intervention. OD research and
theory increasingly have come to identify specific organizational changes needed to imple-
ment particular interventions (much of that information is discussed in Chapters 10
through 20). These variables should guide not only implementation of the intervention
but also choices about what change variables to measure for evaluative purposes. Addi-
tional sources of knowledge about intervention variables can be found in the numerous
references at the end of each of the chapters on intervention in this book and in several
of the books in the Wiley Series on Organizational Assessment and Change.4
The choice of what outcome variables to measure also should be dictated by inter-
vention theory, which specifies the kinds of results that can be expected from particular
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 211
change programs. Again, the material in this book and elsewhere identifies numerous
outcome measures, such as job satisfaction, intrinsic motivation, organizational commit-
ment, absenteeism, turnover, and productivity.
Historically, OD assessment has focused on attitudinal outcomes, such as job satisfac-
tion, while neglecting hard measures, such as performance. Increasingly, however, managers
and researchers are calling for development of behavioral measures of OD outcomes. Man-
agers are interested primarily in applying OD to change work-related behaviors that involve
joining, remaining, and producing at work, and are assessing OD more frequently in terms
of such bottom-line results. Macy and Mirvis have done extensive research to develop a
standardized set of behavioral outcomes for assessing and comparing intervention results.5
Table 9.1 lists 11 outcomes, including their behavioral definitions and recording categories.
The outcomes are in two broad categories: participation-membership, including absentee-
ism, tardiness, turnover, internal employment stability, and strikes and work stoppages;
and performance on the job, including productivity, quality, grievances, accidents, unsched-
uled machine downtime and repair, material and supply overuse, and inventory shrinkage.
All of the outcomes should be important to most managers, and they represent generic
descriptions that can be adapted to both industrial and service organizations.
Designing Good Measures Each of the measurement methods described in
Chapter 6—questionnaires, interviews, observations, and unobtrusive measures—has
advantages and disadvantages. Many of these characteristics are linked to the extent
to which a measurement is operationally defined, reliable, and valid. These assessment
characteristics are discussed below.
Operational Definition. A good measure is operationally defined; that is, it specifies
the empirical data needed, how they will be collected and, most important, how they
will be converted from data to information. For example, Macy and Mirvis developed
operational definitions for the behavioral outcomes listed in Table 9.1 (see Table 9.2).6
They consist of specific computational rules that can be used to construct measures for
each of the behaviors. Most of the behaviors are reported as rates adjusted for the num-
ber of employees in the organization and for the possible incidents of behavior. These
adjustments make it possible to compare the measures across different situations and
time periods. These operational definitions should have wide applicability across both
industrial and service organizations, although some modifications, deletions, and addi-
tions may be necessary for a particular application.
Operational definitions are extremely important in measurement because they pro-
vide precise guidelines about what characteristics of the situation are to be observed and
how they are to be used. They tell OD practitioners and organization members exactly
how diagnostic, intervention, and outcome variables will be measured.
Reliability. Reliability concerns the extent to which a measure represents the “true”
value of a variable—that is, how accurately the operational definition translates data
into information. For example, there is little doubt about the accuracy of the number of
cars leaving an assembly line as a measure of plant productivity. Although it is possible
to miscount, there can be a high degree of confidence in the measurement. On the other
hand, when people are asked to rate their level of job satisfaction on a scale of 1 to 5,
there is considerable room for variation in their response. They may just have had an
argument with their supervisor, suffered an accident on the job, been rewarded for high
levels of productivity, or been given new responsibilities. Each of these events can sway
the response to the question on any given day. The individuals’ “true” satisfaction score
is difficult to discern from this one question and the measure lacks reliability.7
212 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
TABLE 9.1
Behavioral Outcomes for Measuring OD Interventions: Definitions and Recording Categories
Behavioral Definitions Recording Categories
Absenteeism: each absence or illness
over four hours
Voluntary: short-term illness (less than three consecutive days),
personal business, family illness
Involuntary: long-term illness (more than three consecutive days),
funerals, out-of-plant accidents, lack of work (temporary layoff),
presanctioned days off
Leaves: medical, personal, maternity, military, and other (e.g., jury duty)
Tardiness: each absence or illness
under four hours
Voluntary: same as absenteeism
Involuntary: same as absenteeism
Turnover: each movement beyond the
organizational boundary
Voluntary: resignation
Involuntary: termination, disqualification, requested resignation,
permanent layoff, retirement, disability, death
Internal employment stability: each move-
ment within the organizational boundary
Internal movement: transfer, promotion, promotion with transfer
Internal stability: new hires, layoffs, rehires
Strikes and work stoppages: each day lost
as a result of strike or work stoppage
Sanctioned: union-authorized strike, company-authorized lockout
Unsanctioned: work slowdown, walkout, sitdown
Accidents and work-related illness: each
recordable injury, illness, or death
from a work-related accident or from
exposure to the work environment
Major: OSHA accident, illness, or death which results in medical
treatment by a physician or registered professional person
understanding orders from a physician
Minor: non-OSHA accident or illness which results in one-time treat-
ment and subsequent observation not requiring professional care
Revisits: OSHA and non-OSHA accident or illness which requires
subsequent treatment and observation
Grievances: written grievance in
accordance with labor–management
contract
Stage: recorded by step (first through arbitration)
Productivity:* resources used in
production of acceptable outputs
(comparison of inputs with outputs)
Output: product or service quantity (units or $)
Input: direct and/or indirect (labor in hours or $)
Production quality: resources used in
production of unacceptable outputs
Resource utilized: scrap (unacceptable in-plant products in units
or $); customer returns (unacceptable out-of-plant products in
units or $); recoveries (salvageable products in units or $);
rework (additional direct and/or indirect labor in hours or $)
Downtime: unscheduled breakdown of
machinery
Downtime: duration of breakdown (hours or $)
Machine repair: nonpreventive maintenance ($)
Inventory, material, and supply variance:
unscheduled resource utilization
Variance: over- or under-utilization of supplies, materials,
inventory (resulting from theft, inefficiency, and so on)
*Reports only labor inputs.
SOURCE: B. Macy and P. Mirvis, “Organizational Change Efforts: Methodologies for Assessing Organizational Effectiveness and
Program Costs Versus Benefits,” Evaluation Review 6, pp. 306–10. © 1982 by Sage Publications, Inc. Reprinted by permission
of Sage Publications, Inc.
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 213
TABLE 9.2
Behavioral Outcomes for Measuring OD Interventions: Measures and Computational Formula
Behavioral Measure* Computational Formula
Absenteeism rate** (monthly) ∑ Absence days
Average workforce size Working days
Tardiness rate** (monthly) ∑ Tardiness incidents
Average workforce size Working days
Turnover rate (monthly) ∑ Turnover incidents
Average workforce size
Internal stability rate (monthly) ∑ Internal movement incidents
Average workforce size
Strike rate (yearly) ∑ Striking Workers Strike days
Average workforce size Working days
Accident rate (yearly) ∑ of Accidents illnesses
Total yearly hours worked
200,000***
Grievance rate (yearly) ∑ Grievance incidents
Plant: Average workforce size
Individual:
∑ Aggrieved individuals
Average workforce size
Productivity:****
Total
Below standard
Below budget
Variance
Per employee
Output of goods or services units or $
Direct and or indirect labor hours or $
Actual versus engineered standard
Actual versus budgeted standard
Actual versus budgeted variance
Output/average workforce size
Quality:****
Total
Below standard
Below budget
Variance
Per employee
Scrap Customer returns Rework Recoveries ($, units, or hours)
Actual versus engineered standard
Actual versus budgeted standard
Actual versus budgeted variance
Total/average workforce size
Downtime Labor ($) Repair costs or dollar value of replaced equipment ($)
Inventory, supply, and material usage Variance (actual versus standard utilization) ($)
*All measures reflect the number of incidents divided by an exposure factor that represents the number of employees in the
organization and the possible incidents of behavior (e.g., for absenteeism, the average workforce size × the number of working
days). Mean monthly rates (i.e., absences per workday) are computed and averaged for absenteeism, leaves, and tardiness for
a yearly figure and summed for turnover, grievances, and internal employment stability for a yearly figure. The term rate refers
to the number of incidents per unit of employee exposure to the risk of such incidences during the analysis interval.
**Sometimes combined as number of hours missing/average workforce size × working days.
***Base for 100 full-time equivalent workers (40 hours × 50 weeks).
****Monetary valuations can be expressed in labor dollars, actual dollar costs, sales dollars; overtime dollar valuations can be
adjusted to base year dollars to control for salary, raw material, and price increases.
SOURCE: B. Macy and P. Mirvis, “Organizational Change Efforts: Methodologies for Assessing Organizational Effectiveness and
Program Costs Versus Benefits,” Evaluation Review 6, pp. 306–10. © 1982 by Sage Publications, Inc. Reprinted by permission
of Sage Publications, Inc.
214 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
OD practitioners can improve the reliability of their measures in four ways. First,
rigorously and operationally define the chosen variables. Clearly specified operational
definitions contribute to reliability by explicitly describing how collected data will be
converted into information about a variable. An explicit description helps to allay the
organization’s concerns about how the information was collected and coded.
Second, use multiple methods to measure a particular variable. As discussed in
Chapter 6, the use of questionnaires, interviews, observations, and unobtrusive measures
can improve reliability and result in a more comprehensive understanding of the organi-
zation. Because each method contains inherent biases, several different methods can be
used to triangulate on dimensions of organizational issues. If the independent measures
converge or show consistent results, the dimensions or problems likely have been diag-
nosed accurately.8
Third, use multiple items to measure the same variable on a questionnaire. For exam-
ple, in Hackman and Oldham’s Job Diagnostic Survey for measuring job characteristics
(Chapter 14), the intervention variable “autonomy” is operationally defined by the average
of respondents’ answers to the following three questions (measured on a 7-point scale):9
1. The job permits me to decide on my own how to go about doing the work.
2. The job denies me any chance to use my personal initiative or judgment in carrying
out the work. [reverse scored]
3. The job gives me considerable opportunity for independence and freedom in how
I do the work.
By asking more than one question about “autonomy,” the survey increases the accuracy
of its measurement of this variable. Statistical analyses (called psychometric tests) are
readily available for assessing the reliability of perceptual measures, and OD practitioners
should apply these methods or seek assistance from those who can apply them.10 Similarly,
there are methods for analyzing the content of interview and observational data, and
OD evaluators can use these methods to categorize such information so that it can be
understood and replicated.11
Fourth, use standardized instruments. A growing number of standardized question-
naires are available for measuring OD intervention and outcome variables. For example,
the Center for Effective Organizations at the University of Southern California (http://ceo
.usc.edu) and the Institute for Social Research at the University of Michigan (http://home
.isr.umich.edu) have developed comprehensive survey instruments to measure the features
of many of the OD interventions described in this book, as well as their attitudinal out-
comes.12 Considerable research and testing have gone into establishing measures that are
reliable and valid. These survey instruments can be used for initial diagnosis, for guiding
implementation of interventions, and for evaluating immediate and long-term outcomes.
Validity. Validity concerns the extent to which a measure actually reflects the variable it
is intended to measure. For example, the number of cars leaving an assembly line might be
a reliable measure of plant productivity, but it may not be a valid measure. The number of
cars is only one aspect of productivity; they may have been produced at an unacceptably
high cost or at exceptionally low quality. Because the number of cars does not account for
cost and quality, it is not a completely valid measure of plant productivity.
OD practitioners can increase the validity of their measures in several ways. First,
ask colleagues and organization members if a proposed measure actually represents a
particular variable. This is called face validity or content validity. If experts and members
agree that the measure reflects the variable of interest, then there is increased confidence
in the measure’s validity. Second, use multiple measures of the same variable, as
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 215
described in the section about reliability, to make preliminary assessments of the mea-
sure’s criterion or convergent validity. That is, if several different measures of the same
variable correlate highly with each other, especially if one or more of the other measures
have been validated in prior research, then there is increased confidence in the measure’s
validity. A special case of criterion validity, called discriminant validity, exists when the
proposed measure does not correlate with measures that it is not supposed to correlate
with. For example, there is no good reason for daily measures of assembly line produc-
tivity to correlate with daily air temperature. The lack of a correlation would be one indi-
cator that the number of cars is measuring productivity and not some other variable.
Finally, predictive validity is demonstrated when the variable of interest accurately fore-
casts another variable over time. For example, a measure of team cohesion can be said to
be valid if it accurately predicts improvements in team performance in the future.
It is difficult, however, to establish the validity of a measure until it has been used.
To address this concern, OD practitioners should make heavy use of content validity
processes and use measures that already have been validated. For example, presenting
proposed measures to colleagues and organization members for evaluation prior to mea-
surement has several positive effects: It builds ownership and commitment to the data
collection process and improves the likelihood that the client system will find the data
meaningful. Using measures that have been validated through prior research improves
confidence in the results and provides a standard that can be used to validate any new
measures used in collecting the data.
9-1c Research Design
In addition to measurement, OD practitioners must make choices about how to design
the evaluation to achieve valid results. The key issue is how to design the assessment to
show whether the intervention did in fact produce the observed results. This is called
internal validity. The secondary question of whether the intervention would work simi-
larly in other situations is referred to as external validity. External validity is irrelevant
without first establishing an intervention’s primary effectiveness, so internal validity is
the essential minimum requirement for assessing OD interventions. Unless managers
can have confidence that the outcomes are the result of the intervention, they have no
rational basis for making decisions about accountability and resource allocation.
Assessing the internal validity of an intervention is, in effect, testing a hypothesis—
namely, that specific organizational changes lead to certain outcomes. Moreover, testing
the validity of an intervention hypothesis means that alternative hypotheses or explana-
tions of the results must be rejected. That is, to claim that an intervention is successful, it
is necessary to demonstrate that other explanations—in the form of rival hypotheses—do
not account for the observed results. For example, if a job enrichment program appears
to increase employee performance, such other possible explanations as new technology,
improved raw materials, or new employees must be eliminated.
Accounting for rival explanations is not a precise, controlled, experimental process
such as might be found in a research laboratory.13 OD interventions often have a number
of features that make it difficult to determine whether they produced the observed results.
They are complex and often involve several interrelated changes that obscure whether indi-
vidual features or combinations of features are accounting for the results. Many OD inter-
ventions are long-term projects and take considerable time to produce desired outcomes.
The longer the time period of the change program, the greater are the chances that other
factors, such as technology improvements, will emerge to affect the results. Finally, OD
interventions usually are applied to existing work units rather than to randomized groups
216 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
of organization members. Ruling out alternative explanations associated with randomly
selected intervention and comparison groups is, therefore, difficult.
Given the problems inherent in assessing OD interventions, practitioners have
turned to quasi-experimental research designs.14 These designs are not as rigorous and
controlled as are randomized experimental designs, but they allow evaluators to rule
out many rival explanations for OD results other than the intervention itself. Although
several quasi-experimental designs are available, those with the following three features
are particularly powerful for assessing changes:
1. Longitudinal measurement. This involves measuring results repeatedly over rela-
tively long time periods. Ideally, the data collection should start before the change
program is implemented and continue for a period considered reasonable for pro-
ducing expected results.
2. Comparison unit. It is always desirable to compare results in the intervention situ-
ation with those in another situation where no such change has taken place.
Although it is never possible to get a matching group identical to the intervention
group, most organizations include a number of similar work units that can be used
for comparison purposes.
3. Statistical analysis. Whenever possible, statistical methods should be used to rule
out the possibility that the results are caused by random error or chance. Various
statistical techniques are applicable to quasi-experimental designs, and OD practi-
tioners should apply these methods or seek help from those who can apply them.
Table 9.3 provides an example of a quasi-experimental design having these three fea-
tures. The intervention is intended to reduce employee absenteeism. Measures of absentee-
ism are taken from company monthly records for both the intervention and comparison
groups. The two groups are similar yet geographically separate subsidiaries of a multiplant
company. Table 9.3 shows each plant’s monthly absenteeism rate for four consecutive
months both before and after the start of the intervention. The plant receiving the inter-
vention shows a marked decrease in absenteeism in the months following the intervention,
whereas the control plant shows comparable levels of absenteeism in both time periods.
Statistical analyses of these data suggest that the abrupt downward shift in absenteeism fol-
lowing the intervention was not attributable to chance variation. This research design and
the data provide relatively strong evidence that the intervention was successful.
Quasi-experimental research designs using longitudinal data, comparison groups,
and statistical analysis permit reasonable assessments of intervention effectiveness.
Repeated measures often can be collected from company records without directly involv-
ing members of the experimental and comparison groups. These unobtrusive measures
are especially useful in OD assessment because they do not interact with the intervention
TABLE 9.3
Quasi-Experimental Research Design
Monthly Absenteeism (%)
Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr.
Intervention group 5.1 5.3 5.0 5.1 Start of intervention 4.6 4.0 3.9 3.5
Comparison group 2.5 2.6 2.4 2.5 2.6 2.4 2.5 2.5
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and affect the results. Measures that are more obtrusive, such as questionnaires and
interviews, are reactive and can sensitize people to the intervention. When this happens,
it is difficult to know whether the observed findings are the result of the intervention, the
measuring methods, or some combination of both.
Multiple measures of intervention and outcome variables should be applied to mini-
mize measurement and intervention interactions. For example, obtrusive measures such
as questionnaires could be used sparingly, perhaps once before and once after the inter-
vention. Unobtrusive measures, such as the behavioral outcomes shown in Tables 9.1
and 9.2, could be used repeatedly, thus providing a more extensive time series than the
questionnaires. When used together, the two kinds of measures should produce accurate
and nonreactive evaluations of the intervention.
The use of multiple measures also is important in assessing perceptual changes result-
ing from interventions. Considerable research has identified three types of change—alpha,
beta, and gamma—that occur when using self-report, perceptual measures.15
Alpha change refers to movement along a measure that reflects stable dimensions of
reality. For example, comparative measures of perceived employee discretion might show
an increase after a job enrichment program. If this increase represents alpha change, it
can be assumed that the job enrichment program actually increased employee percep-
tions of discretion.
Beta change involves the recalibration of the intervals along some constant measure
of reality. For example, before-and-after measures of perceived employee discretion can
decrease after a job enrichment program. If beta change is involved, it can explain this
apparent failure of the intervention to increase discretion. The first measure of discretion
may accurately reflect the individual’s belief about the ability to move around and talk to
fellow workers in the immediate work area. During implementation of the job enrich-
ment intervention, however, the employee may learn that the ability to move around is
not limited to the immediate work area. At a second measurement of discretion, the
employee, using this new and recalibrated understanding, may rate the current level of
discretion as lower than before.
Gamma change involves fundamentally redefining the measure as a result of an OD
intervention. In essence, the framework within which a phenomenon is viewed changes.
For example, the presence of gamma change would make it difficult to compare mea-
sures of employee discretion taken before and after a job enrichment program. The mea-
sure taken after the intervention might use the same words, but they represent an
entirely different concept. As described above, the term “discretion” may originally refer
to the ability to move about the department and interact with other workers. After the
intervention, discretion might be defined in terms of the ability to make decisions about
work rules, work schedules, and productivity levels. In sum, the job enrichment interven-
tion changed the way discretion is perceived and how it is evaluated.
These three types of change apply to perceptual measures. When changes other than
alpha ones occur, interpreting measurement changes becomes far more difficult. Potent
OD interventions may produce both beta and gamma changes, and this severely compli-
cates interpretations of findings reporting change or no change. Further, the distinctions
among the three different types of change suggest that the heavy reliance on question-
naires, so often cited in the literature, should be balanced by using other measures,
such as interviews and unobtrusive records. Analytical methods have been developed to
assess the three kinds of change, and OD practitioners should gain familiarity with these
recent techniques.16
Application 9.1 describes the implementation and evaluation feedback that were
developed for the Alegent Health project. It is a good example of how data can be used
218 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
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1 EVALUATING CHANGE AT ALEGENT HEALTH
I
n July and August of 2005, Alegent Health
(AH) conducted six large group interventions
or “decision accelerators” (DAs) to generate
innovative strategies for its six clinical ser-
vice areas. Researchers at USC’s Center for
Effective Organizations contracted with AH to
assess the impact of the interventions and to
help the organization learn how to leverage fur-
ther change. The applications in Chapter 4
described how the researchers entered and
contracted with the organization, and Applica-
tion 6.1 described the data collection and anal-
ysis process. In this application, we describe
the implementation and evaluation feedback
the researchers generated.
In terms of implementation feedback, the
collected data described perceptions of change
progress and employee involvement. For exam-
ple, executive interviews and surveys from peo-
ple who participated in “review DAs” to reflect on
implementation progress and plan future changes
supported a positive assessment of overall prog-
ress. People generally agreed that the implemen-
tation of the clinical strategies was going well.
They were positive about the social capital that
had been created by the DAs, especially between
administrators and physicians, as well as the evi-
dence of culture change. Nearly everyone in the
organization believed that the clinical strategies
were the “right thing to do.” In contrast to these
positive findings, there was some concern about
feeling involved in the change.
That is, the DAs were a great energizer for
the organization, generated comprehensive
strategies, and catalyzed important changes.
However, the data also contained some reserva-
tions about the organization’s ability to leverage
the changes. As described in Application 6.1,
the implementation approaches were mostly
informal; the organization was afraid that too
many dedicated change processes and systems
might slow down the change process. The data
revealed a more complex set of issues.
First, executives and some physicians under-
stood the roles, decisions, and processes related
to implementation more than operational man-
agers and other physicians. The six clinical ser-
vices areas studied described an intense period
of business planning following the DAs. Senior
management, all of whom had participated in the
original six DAs, drove this process and were quite
clear about the resulting priorities and initiatives.
This clarity, however, was not widely shared by
the hospital COOs, many physicians, and many
operational managers. This resulted in a percep-
tion of a strong connection between strategy for-
mulation and implementation at the top of the
organization, but a weak perception in the middle
of the organization. Managers and nurses felt
overwhelmed—they heard about change with lit-
tle context, and believed that the speed of change
was slower rather than faster because “every-
thing was important.” Similarly, many physicians
who were energized by the DAs wanted to know
“where’s the change?” While exceptions to this
observation did exist, there was a general sense
that senior managers were more involved and
saw more change than others saw.
Second, the absence of formal change-
management processes made important
resource allocation decisions, trade-offs on tech-
nology, and coordination of quality processes
across the system more difficult. There was no
visible mechanism, for example, to decide how
quality programs should be rolled out or where
to pilot electronic medical record systems. The
lack of formal change-management systems
(action plans, governance mechanisms, learning
practices) following the DAs was related to some
feelings among all stakeholder groups that
change was slow in coming and overwhelming
when it did come. Most people correctly viewed
the strategies created by the DAs as high-level
plans providing general direction. However, the
process for developing action plans and imple-
mentation activities was not visible to many peo-
ple. Ad hoc change systems emerged based on
the nature of the strategy implementation activi-
ties and these helped to focus attention and
resources. Interestingly, these systems all started
to emerge about one year after the original DAs.
Based on these implementation data, and the
data presented in Application 6.1 about how the
DA needed to evolve, the researchers recom-
mended (1) creating different versions of the DA
to address different issues and (2) formalizing
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 219
some change processes so that the resourcing, exe-
cution, and communication of change were more
coordinated. However, their overall recommendation
was to continue using the DA for strategy formulation
and visioning, as well as tactical and implementation-
oriented issues.
In terms of evaluation feedback, the analysis of
the activities described in the DA reports provided
some important conclusions. For example, the com-
position of the DAs, or the mix of AH managers and
staff, physicians, community members, and other
stakeholders, affected the processes and out-
comes. First, in DAs where there was a higher pro-
portion of physicians, there was a narrower range of
stakeholder participation and an increased likelihood
that the group would deviate from the agenda. In
addition, there was a weak relationship between
higher percentages of community participants and
all DA processes. That is, when the DA had more
community participants, there was broader partici-
pation in the discussions, the debates were more
intense, and the DA stayed on track.
Second, the composition of the DA had differ-
ential impacts on the outcomes of meeting. When
the DA had a high percentage of physicians, the
resulting vision was less comprehensive. On the
other hand, when the DA had a high concentration
of community participants, the vision was more
comprehensive. These results were reflected in
the survey data as well. The percentage of commu-
nity participants was positively related to percep-
tions that the strategy was more innovative but
less aggressive and business oriented. The concen-
tration of physicians in the DA tended to have oppo-
site relationships with the strategy dimensions.
When these data were fed back to the organi-
zation, the researchers specifically pointed out that
these findings did not suggest that it was wrong to
involve physicians or that a higher percentage of
community members was better. To the contrary,
the fundamental assumption of DA interventions
was that a broader mix of stakeholders contributes
to a better solution. These data did suggest that
not all stakeholder groups are created equal. Too
many of any type of stakeholder group may lead
to lopsided discussions and sway the agenda. In
several of the DAs, for example, almost half of
the participants were physicians, making it likely
that this constituency would disproportionately
impact the flow of the meeting.
The table below summarizes many of the find-
ings from the Alegent project.
Evaluation Question Data
• Does Alegent’s strategy, purpose, and
organization support change?
– Yes—Many powerful internal and external forces are
pushing for and supporting change
• How effective were the original six
DAs in achieving intended outcomes?
– Very effective—The DAs generated a lot of energy for
change, healed physician relationships, and utilized good
thinking
• What DA characteristics made a
difference?
– The DA’s composition was an important influence on its
processes and outcomes
• How do executives and managers char-
acterize the service-line strategies?
– Comprehensive, somewhat innovative, and business-
oriented
• Are they similar or different? – Managers are more positive than executives
• How is the implementation process
being orchestrated?
– Informally—As a result, people feel overwhelmed by
change
• What processes, structure, and roles
have been put in place to make the
strategies a reality?
– Few—People agree there is change capacity but want
more involvement and action
• How is the implementation going? – Generally positive attributions
• Is there evidence that implementation is
likely to produce desired outcomes?
– While uncertainty exists, there are many shared sug-
gestions for moving forward and commitment is high
220 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
to guide current implementation and evaluate the effectiveness of an intervention. But
the evaluation is not perfect. What are the strengths and weaknesses of the assessment?
How could it have been improved? How much confidence do you have in the lessons
learned from this organization?
9-2 Institutionalizing Organizational Changes
Once it is determined that changes have been implemented and are effective, attention is
directed at institutionalizing the changes—maintaining them as a normal part of the
organization’s functioning for an appropriate period of time.17 In complex and uncertain
environments, some changes are only part of a long journey of organization adaptation.
Innovating new products is not a one-time change but a continuous process that must be
implemented over and over again. Other changes, such as the process for appraising per-
formance, need to persist. For example, there is little to be gained from making front-line
supervisors learn a new performance rating system every year.
Lewin described change as occurring in three stages: unfreezing, moving, and
refreezing. Institutionalizing an OD intervention concerns refreezing. It involves the
long-term persistence of organizational changes: To the extent that changes persist, they
can be said to be institutionalized. Such changes are not dependent on any one person
but exist as a part of the culture of an organization. This means that numerous others
share norms about the appropriateness of the changes.
How planned changes become institutionalized has not received much attention in
the OD literature. Rapidly changing environments have led to admonitions from consul-
tants and practitioners to “change constantly,” to “change before you have to,” and “if
it’s not broke, fix it anyway.” Such a context has challenged the utility of the institution-
alization concept. Why endeavor to make any change permanent given that it may
require changing again soon? However, the admonitions also have resulted in institution-
alization concepts being applied in new ways. Change itself has become the focus of
institutionalization. Dynamic strategy making, self-design, organization learning, and
built-to-change interventions described in Chapter 19 all are aimed at enhancing the
Overall, the researchers concluded that:
1. There was a demonstrable and palpable
change in a variety of organization features
that if not directly tied to the DA were certainly
hastened by it. A large number of specific stra-
tegic, operational, and practice-oriented
changes connected with each clinical area
had been implemented relatively quickly. In
addition, there was substantial agreement
that the culture was changing, as evidenced
by new language, regular and extensive use
of DAs, collaborative decision making, open-
ness to innovation, confidence in leadership,
and openness to joint ventures with the
physicians. Finally, there was broad agreement
that the DA process represented a visible and
tangible effort to address physician relation-
ships and clearly moved those relationships
in a positive direction.
2. The organization’s initial use of the DA process
as a strategic visioning intervention persists
in the minds of most organization members.
Alegent Health can productively apply the
technology and principles to other, more
implementation-oriented issues. On the other
hand, DAs cannot do everything, and comple-
mentary governance and implementation pro-
cesses are necessary.
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 221
organization’s change capability.18 In this vein, processes of institutionalization take on
increased utility. This section presents a framework for identifying factors and processes
that contribute to the institutionalization of OD interventions, including the process of
change itself.
9-2a
Institutionalization Framework
Figure 9.2 presents a framework that identifies organization and intervention character-
istics and institutionalization processes affecting the degree to which change programs
are institutionalized.19 The model shows that two key antecedents—organization and
intervention characteristics—affect different institutionalization processes operating in
organizations. These processes, in turn, affect various indicators of institutionalization.
The model also shows that organization characteristics can influence intervention char-
acteristics. For example, organizations having powerful unions may have trouble gaining
internal support for OD interventions.
9-2b Organization Characteristics
Figure 9.2 shows that the following three dimensions of an organization can affect inter-
vention characteristics and institutionalization processes:
1. Congruence. This is the degree to which an intervention is perceived as being in har-
mony with the organization’s managerial philosophy, strategy, and structure; its cur-
rent environment; and other changes taking place.20 When an intervention is
congruent with these dimensions, the probability is improved that it will be supported
and sustained. Congruence can facilitate persistence by making it easier to gain mem-
ber commitment to the intervention and to diffuse it to wider segments of the organi-
zation. The converse also is true: Many OD interventions promote employee
FIGURE 9.2
Institutionalization Framework
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222 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
participation and growth. When applied in highly bureaucratic organizations with for-
malized structures and autocratic managerial styles, participative interventions are not
perceived as congruent with the organization’s managerial philosophy.
2. Stability of environment and technology. This involves the degree to which the
organization’s environment and technology are changing. The persistence of change
is favored when environments are stable. Under these conditions, it makes sense to
embed the change in an organization’s culture and organization design processes.
On the other hand, volatile demand for the firm’s products or services can lead to
reductions in personnel that may change the composition of the groups involved in
the intervention or bring new members on board at a rate faster than they can be
socialized effectively.
3. Unionization. Diffusion of interventions may be more difficult in unionized set-
tings, especially if the changes affect union contract issues, such as salary and fringe
benefits, job design, and employee flexibility. For example, a rigid union contract
can make it difficult to merge several job classifications into one, as might be
required to increase task variety in a job enrichment program. It is important to
emphasize, however, that unions can be a powerful force for promoting change, par-
ticularly when a good relationship exists between union and management.
9-2c Intervention Characteristics
Figure 9.2 shows that the following five features of OD interventions can affect institu-
tionalization processes:
1. Goal specificity. This involves the extent to which intervention goals are specific
rather than broad. Specificity of goals helps direct socializing activities (for example,
training and orienting new members) to particular behaviors required to implement
the intervention. It also helps operationalize the new behaviors so that rewards can
be linked clearly to them. For example, an intervention aimed only at increasing
product quality is likely to be more focused and readily put into operation than a
change program intended to improve quality, quantity, safety, absenteeism, and
employee development.
2. Programmability. This involves the degree to which the changes can be pro-
grammed or the extent to which the different intervention characteristics can be
specified clearly in advance to enable socialization, commitment, and reward alloca-
tion. For example, job enrichment specifies three targets of change: employee discre-
tion, task variety, and feedback. The change program can be planned and designed
to promote those specific features.
3. Level of change target. This concerns the extent to which the change target is the
total organization, rather than a department or small work group. Each level of the
organization has facilitators and inhibitors of persistence. Department and group
change are susceptible to countervailing forces from others in the organization.
These can reduce the diffusion of the intervention and lower its ability to impact orga-
nization effectiveness. However, this does not preclude institutionalizing the change
within a department that successfully insulates itself from the rest of the organization.
Such insulation often manifests itself as a subculture within the organization.21
Targeting the intervention toward wider segments of the organization, on the
other hand, can also help or hinder change persistence. A shared belief about the
intervention’s value can be a powerful incentive to maintain the change, and
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 223
promoting a consensus across organization departments exposed to the change can
facilitate institutionalization. However, targeting the larger system also can inhibit
institutionalization. The intervention can become mired in political resistance
because of the “not invented here” syndrome or because powerful constituencies
oppose it.
4. Internal support. This refers to the degree to which there is an internal support sys-
tem to guide the change process. Internal support, typically provided by an internal
OD practitioner, can gain commitment for the changes and help organization mem-
bers implement them. External consultants also can provide support, especially on
a temporary basis during the early stages of implementation. For example, in
many interventions aimed at implementing high-involvement organizations (see
Chapter 13), both external and internal OD practitioners provide change support.
The external consultant typically brings expertise on organizational design and
trains members to implement the design. The internal consultant generally helps
members relate to other organizational units, resolve conflicts, and legitimize the
change activities within the organization.
5. Sponsorship. This concerns the presence of a powerful sponsor who can initiate,
allocate, and legitimize resources for the intervention. Sponsors must come from
levels in the organization high enough to control appropriate resources, and they
must have the visibility and power to nurture the intervention and see that it
remains viable. There are many examples of OD interventions that persisted for sev-
eral years and then collapsed abruptly when the sponsor, usually a top administra-
tor, left the organization. There also are numerous examples of middle managers
withdrawing support for interventions because top management did not include
them in the change program.
9-2d Institutionalization Processes
The framework depicted in Figure 9.2 shows the following five institutionalization pro-
cesses that can directly affect the degree to which OD interventions are institutionalized:
1. Socialization. This concerns the transmission of information about beliefs, prefer-
ences, norms, and values with respect to the intervention. Because implementation
of OD interventions generally involves considerable learning and experimentation,
a continual process of socialization is necessary to promote persistence of the
change program. Organization members must focus attention on the evolving
nature of the intervention and its ongoing meaning. They must communicate this
information to other employees, especially new members of the organization.
Transmission of information about the intervention helps bring new members
onboard and allows participants to reaffirm the beliefs, norms, and values underly-
ing the intervention.22 For example, employee involvement programs often include
initial transmission of information about the intervention, as well as retraining of
existing participants and training of new members. Such processes are intended to
promote persistence of the program as new behaviors are learned and new mem-
bers introduced.
2. Commitment. This binds people to behaviors associated with the intervention. It
includes initial commitment to the program, as well as recommitment over time.
Opportunities for commitment should allow people to select the necessary behaviors
freely, explicitly, and publicly. These conditions favor high commitment and can
224 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
promote stability of the new behaviors. Commitment should derive from several orga-
nizational levels, including the employees directly involved and the middle and upper
managers who can support or thwart the intervention. In many early employee involve-
ment programs, for example, attention was directed at gaining workers’ commitment to
such programs. Unfortunately, middle managers were often ignored and considerable
management resistance to the interventions resulted.
3. Reward allocation. This involves linking rewards to the new behaviors required by
an intervention. Organizational rewards can enhance the persistence of changes in at
least two ways. First, a combination of intrinsic and extrinsic rewards can reinforce
new behaviors. Intrinsic rewards are internal to people and derive from the oppor-
tunities for challenge, development, and accomplishment found in the work. When
interventions provide these opportunities, motivation to perform should persist.
This behavior can be further reinforced by providing extrinsic rewards, such as
money, for increased contributions. Because the value of extrinsic rewards tends to
diminish over time, it may be necessary to revise the reward system to maintain
high levels of desired behaviors.
Second, new behaviors will persist to the extent that rewards are perceived as
equitable by employees. When new behaviors are fairly compensated, people are
likely to develop preferences for those behaviors. Over time, those preferences
should lead to normative and value consensus about the appropriateness of the
intervention. For example, many employee involvement programs fail to persist
because employees feel that their increased contributions to organizational improve-
ments are unfairly rewarded. This is especially true for interventions relying exclu-
sively on intrinsic rewards. People argue that an intervention that provides
opportunities for intrinsic rewards also should provide greater pay or extrinsic
rewards for higher levels of contribution to the organization.
4. Diffusion. This refers to the process of transferring changes from one system to
another. Diffusion facilitates institutionalization by providing a wider organizational
base to support the new behaviors. Many interventions fail to persist because they
run counter to the values, purpose, or identity of the larger organization. Rather
than support the intervention, the larger organization rejects the changes and often
puts pressure on the change target to revert to old behaviors. Diffusion of a change
to other organizational units reduces this counter-implementation force. It tends to
lock in behaviors by providing normative consensus from other parts of the organi-
zation. Moreover, the act of transmitting institutionalized behaviors to other systems
reinforces commitment to the changes.
5. Sensing and calibration. This involves detecting deviations from desired interven-
tion behaviors and taking corrective action. Institutionalized behaviors invariably
encounter destabilizing forces, such as changes in the environment, new technolo-
gies, and pressures from other departments to nullify changes. These factors cause
some variation in performances, preferences, norms, and values. To detect this
variation and take corrective actions, organizations must have some sensing mech-
anism. Sensing mechanisms, such as implementation feedback, provide informa-
tion about the occurrence of deviations. This knowledge can then initiate
corrective actions to ensure that behaviors are more in line with the intervention.
For example, if a high level of job discretion associated with a job enrichment
intervention does not persist, information about this problem might initiate cor-
rective actions, such as renewed attempts to socialize people or to gain commit-
ment to the intervention.
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 225
9-2e Indicators of Institutionalization
Institutionalization is not an all-or-nothing concept but reflects degrees of persistence in
a change. Figure 9.2 shows five indicators of the extent of an intervention’s persistence.
The extent to which the following factors are present or absent indicates the degree of
institutionalization:
1. Knowledge. This involves the extent to which organization members have knowl-
edge of the behaviors associated with an intervention. It is concerned with whether
members know enough to perform the behaviors and to recognize the consequences
of that performance. For example, job enrichment includes a number of new beha-
viors, such as performing a greater variety of tasks, analyzing information about task
performance, and making decisions about work methods and plans.
2. Performance. This is concerned with the degree to which intervention behaviors are
actually performed. It may be measured by counting the proportion of relevant peo-
ple performing the behaviors. For example, 60% of the employees in a particular
work unit might be performing the job enrichment behaviors described above.
Another measure of performance is the frequency with which the new behaviors
are performed. In assessing frequency, it is important to account for different varia-
tions of the same essential behavior, as well as highly institutionalized behaviors that
need to be performed only infrequently.
3. Preferences. This involves the degree to which organization members privately
accept the organizational changes. This contrasts with acceptance based primarily
on organizational sanctions or group pressures. Private acceptance usually is
reflected in people’s positive attitudes toward the changes and can be measured by
the direction and intensity of those attitudes across the members of the work unit
receiving the intervention. For example, a questionnaire assessing members’ percep-
tions of a job enrichment program might show that most employees have a strong
positive attitude toward making decisions, analyzing feedback, and performing a
variety of tasks.
4. Normative consensus. This focuses on the extent to which people agree about the
appropriateness of the organizational changes. This indicator of institutionalization
reflects how fully changes have become part of the normative structure of the organi-
zation. Changes persist to the degree members feel that they should support them. For
example, a job enrichment program would become institutionalized to the extent that
employees support it and see it as appropriate to organizational functioning.
5. Value consensus. This is concerned with social consensus on values relevant to the
organizational changes. Values are beliefs about how people ought or ought not to
behave. They are abstractions from more specific norms. Job enrichment, for exam-
ple, is based on values promoting employee self-control and responsibility. Different
behaviors associated with job enrichment, such as making decisions and performing
a variety of tasks, would persist to the extent that employees widely share values of
self-control and responsibility.
These five indicators can be used to assess the level of change persistence. The more
the indicators are present in a situation, the higher will be the degree of institutionaliza-
tion. Further, these factors seem to follow a specific development order: knowledge, perfor-
mance, preferences, norms, and values. People must first understand new behaviors or
changes before they can perform them effectively. Such performance generates rewards
and punishments, which in time affect people’s preferences. As many individuals come to
prefer the changes, normative consensus about their appropriateness develops. Finally, if
226 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
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2 INSTITUTIONALIZING STRUCTURAL CHANGEAT HEWLETT-PACKARD
I
n May 2002, the hotly contested acquisition of
Compaq by Hewlett-Packard (www.hp.com)
was finalized. Unlike the major organization
changes before it, the acquisition challenged
the abilities of this perennial “most admired com-
pany” to execute a complex structural change.
The success of the integration process described
in Application 8.4 is partly due to a store of institu-
tionalized knowledge and capability within the HP
organization. This application describes a number
of large-scale structural changes at HP. The com-
pany’s repeated ability to carry out such change
speaks to its institutionalized capability to manage
change.
Since its founding in 1939, HP has implemen-
ted successfully no fewer than a dozen major orga-
nizational changes, including the transition from a
high-tech entrepreneurial start-up to a profes-
sionally managed company; from a small instru-
ments business to a leading computer company;
from a company oriented around complex-
instruction-set computing technology to reduced-
instruction-set computing technology; from a
technology/engineering-based company to a
market/brand-driven company; and, from a “pure
products” company to a services company.
HP’s electronics and computer business
was characterized by highly volatile technological
and market change. It had to quickly adopt, inno-
vate, and implement a variety of technological
and organizational changes just to survive. HP’s
traditional and current strategies were built on
innovation, differentiation, and high quality.
Another important feature of HP, and one of its
more enduring characteristics, is the “HP
Way”—a cultural artifact that supports a partici-
pative management style and emphasizes com-
monness of purpose and teamwork on one hand
and individual freedom and initiative on the other.
Over time, however, the HP Way has been both
a constraint to and a facilitator of change.
For example, the HP Way has been at the
root of the company’s difficulties in institutional-
izing structural and behavioral changes to bring
about more cooperation among the computer
divisions. The initial structural change occurred
in 1982 when HP transformed itself from a pro-
ducer of high-quality electronic measuring
instruments into a computer company. At the
time, computers and computer-related equip-
ment accounted for only about one-third of rev-
enues and HP was structured into more than 50
highly autonomous and decentralized product
divisions focused on specialized niche markets.
Individual engineers came up with innovative
ideas and “bootstrapped” new products any
way they could. Organization members were
encouraged to work with other engineers in
other departments within the same division,
but there was little incentive to coordinate the
development of technologies across divisions.
This focus on the individual was supported by
a performance management system that mea-
sured and rewarded “sustained contributions;”
the key to success for an individual was work-
ing with many people in the division. HP pros-
pered by maximizing each of its parts.
Former CEO John Young’s decision to
focus on computers fundamentally shifted the
keys to success. Computer production required
a coordinated effort among the different compo-
nent divisions and market shares large enough
to encourage software vendors to write pro-
grams for their machines. In a culture that sup-
ported individual contributions over divisional
cooperation, Young placed all the instruments
divisions into one group and all the computer
divisions into another group, a basic design that
persisted until the spin-off of the Agilent instru-
ments business in 1999. In addition, he central-
ized research, marketing, and manufacturing,
which had previously been assigned to the divi-
sions. Problems quickly arose. In one case, the
company’s new and highly touted graphics
printer would not work with its HP3000 mini-
computer. The operating software, made by a
third HP division, would not allow the two pieces
of hardware to interface.
In response, the computer group formed
committees to figure out what new technolo-
gies to pursue, which to ignore, which of HP’s
products should be saved, and which would be
CHAPTER 9 EVALUATING AND INSTITUTIONALIZING ORGANIZATION DEVELOPMENT INTERVENTIONS 227
©
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7
Designing Interventions
learni
ng
objectives
Describe the interventions presented in the text.
Discuss how contingencies related to the change situation affect
the design of effective organization development (OD) interventions.
Discuss how contingencies related to the target of change affect
the design of effective OD interventions.
A
n organization development intervention is a
sequence of activities, actions, and events
intended to help an organization improve its
performance and effectiveness. Designing interven-
tions, or action planning, derives from careful diag-
nosis and is meant to resolve specific problems
and to improve particular areas of organizational
functioning identified in the diagnosis. Organization
development (OD) interventions vary from standard-
ized programs that have been developed and used
in many organizations to relatively unique programs
tailored to a specific organization or department.
This chapter serves as an overview of the
intervention design process. It briefly describes
the various types of OD interventions presented in
this book. Parts 3–6 of this text describe fully the
major interventions used in OD today. Criteria that
define effective OD interventions are discussed and
contingencies that guide successful intervention
design are identified.
7-1 Overview of Interventions
The OD interventions described here represent the major organization change methods
used in OD today. They include four major types of planned change: human process
interventions, technostructural interventions, human resource management interven-
tions, and strategic change interventions.
7-1a Human Process Interventions
Part 3 of the book presents interventions focusing on people within organizations and
the processes through which they accomplish organizational goals. These processes
include communication, problem solving, group decision making, and leadership. This
type of intervention is deeply rooted in OD’s history and represents the earliest change
157
programs characterizing the field. Human process interventions derive mainly from the
disciplines of psychology and social psychology and the applied fields of group dynamics
and human relations. Practitioners applying these interventions generally value human
fulfillment and expect that organizational effectiveness follows from improved function-
ing of people and organizational processes.1
Chapter 10 discusses human process interventions related to interpersonal relation-
ships and group dynamics. They are among the oldest and most applied interventions in
OD and include the following three change programs:
1. Process consultation. This intervention focuses on interpersonal relations and social
dynamics occurring in work groups. Typically, a process consultant helps group
members diagnose group functioning and devise appropriate solutions to process
problems, such as dysfunctional conflict, poor communication, and ineffective norms.
The aim is to help members gain the skills and understanding necessary to identify
and solve interpersonal and group problems themselves.
2. Third-party intervention. This change method is a form of process consultation
aimed at dysfunctional interpersonal relations in organizations. Interpersonal con-
flict may derive from substantive issues, such as disputes over work methods, or
from interpersonal issues, such as miscommunication. The third-party intervener
helps people resolve conflicts through such methods as problem solving, bargaining,
and conciliation.
3. Team building. This intervention helps work groups become more effective in
accomplishing tasks. Like process consultation, team building helps members diag-
nose group processes and devise solutions to problems. It goes beyond group pro-
cesses, however, to include examination of the group’s task, member roles, and
strategies for performing tasks. The OD practitioner also may function as a resource
person offering expertise related to the group’s task.
Chapter 11 presents human process interventions that are more system-wide than
those described in Chapter 10. They typically focus on the total organization or an entire
department, as well as on relations between groups. They include three interventions:
1. Organization confrontation meeting. This change method mobilizes organiza-
tion members to identify problems, set action targets, and begin working on prob-
lems. It is usually applied when organizations are experiencing stress and when
management needs to organize resources for immediate problem solving. The
intervention generally includes various groupings of employees in identifying
and solving problems.
2. Intergroup relations. These interventions are designed to improve interactions
among different groups or departments in organizations. The microcosm group
intervention involves a small group of people whose backgrounds closely match the
organizational problems being addressed. This group addresses the problems and
develops means to solve them. The intergroup conflict model typically involves
an OD practitioner helping two groups understand the causes of their conflict and
choosing appropriate solutions.
3. Large group interventions. These interventions involve getting a broad variety of
stakeholders into a large meeting to clarify important values, to develop new ways
of working, to articulate a new vision for the organization, or to solve pressing
organizational problems. Such meetings are powerful tools for creating awareness
of organizational problems and opportunities for specifying valued directions for
future action.
158 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
7-1b Technostructural Interventions
Part 4 of the book presents interventions focusing on an organization’s technology
(e.g., task methods and job design) and structure (e.g., division of labor and hierarchy).
These change methods are receiving increasing attention in OD, especially in light
of current concerns about productivity and organizational effectiveness. They include
approaches to employee involvement, as well as methods for structuring organizations,
groups, and jobs. Technostructural interventions are rooted in the disciplines of engi-
neering, sociology, and psychology and in the applied fields of sociotechnical systems
and organization design. Practitioners generally stress both productivity and human
fulfillment and expect that organization effectiveness will result from appropriate work
designs and organization structures.2
In Chapter 12, we discuss the following three technostructural interventions con-
cerned with restructuring organizations:
1. Structural design. This change process concerns the organization’s division of
labor—how tasks are subdivided into work units and how those units are coordi-
nated for task completion. Interventions aimed at structural design include moving
from more traditional ways of dividing the organization’s overall work (such as
functional, self-contained unit, and matrix structures) to more integrative and flexi-
ble forms (such as process-based, customer-centric, and network-based structures).
Diagnostic guidelines exist to determine which structure is appropriate for particular
organizational environments, technologies, and conditions.
2. Downsizing. This intervention reduces costs and bureaucracy by decreasing the size
of the organization through personnel layoffs, organization redesign, and outsour-
cing. Each of these downsizing methods must be planned with a clear understanding
of the organization’s strategy.
3. Reengineering. This intervention radically redesigns the organization’s core work pro-
cesses to create tighter linkage and coordination among the different tasks. This work-
flow integration results in faster, more responsive task performance. Reengineering
is often accomplished with new information technology that permits employees to
control and coordinate work processes more effectively. Reengineering often fails if
it ignores the basic principles and processes of OD.
Chapter 13 is concerned with methods for involving employees in decision making.
These generally attempt to move knowledge, power, information, and rewards downward
in the organization. They include the following three interventions:
1. Parallel structures. This intervention involves organization members in resolving
ill-defined, complex problems. Parallel structures, such as cooperative union-
management projects and quality circles, operate in conjunction with the formal
organization and provide members with an alternative setting in which to address
problems and propose solutions.
2. Total quality management. This intervention involves organization members in
continuously improving quality as part of normal work operations. It includes
extensive training in total quality management knowledge and skills and the con-
stant application of that expertise to improve quality at work.
3. High-involvement organizations. This comprehensive intervention designs almost
all features of the organization to promote high levels of employee involvement.
Changes in structure, work design, information and control systems, and human
resource practices jointly support member involvement in relevant decision making
throughout the firm.
CHAPTER 7 DESIGNING INTERVENTIONS 159
Chapter 14 discusses designing work for individual jobs and interactive groups.
These change programs involve engineering, motivational, and sociotechnical systems
approaches to work design. They include two OD interventions:
1. Job enrichment. Based on motivational principles, this intervention creates jobs that
employees are likely to experience as meaningful with high levels of autonomy and
feedback from performing the work. Job enrichment results in high job satisfaction
and performance quality, especially for those individuals who have needs for growth
and learning at work.
2. Self-managed work teams. This intervention designs work for teams performing
highly interrelated tasks that require real-time decision making. Self-managed work
teams are typically responsible for a complete product or service and members are
able to make decisions and control their own task behaviors without a lot of external
controls.
7-1c Human Resources Management Interventions
Part 5 of the book focuses on interventions used to select, reward, develop, and support
people in organizations. These practices traditionally have been associated with the
human resources function in organizations. In recent years, interest has grown in
integrating human resources management with OD. Human resources management
interventions are rooted in labor relations and in the applied practices of compensation
and benefits, employee selection and placement, performance appraisal, career develop-
ment, and employee diversity and wellness. Practitioners in this area typically focus on
the people in organizations, believing that organizational effectiveness results from
improved practices for integrating employees into organizations.
Chapter 15 discusses interventions concerning performance management, including
the following change programs:
1. Goal setting. This change program involves setting clear and challenging goals. It
attempts to improve organization effectiveness by establishing a better fit between
personal and organizational objectives. Managers and subordinates periodically meet
to plan work, review accomplishments, and solve problems in achieving goals.
Management by Objectives, a special case of the goal-setting intervention, is also
discussed.
2. Performance appraisal. This intervention is a systematic process of jointly assessing
work-related achievements, strengths, and weaknesses. It is the primary human
resources management intervention for providing performance feedback to indivi-
duals and work groups. Performance appraisal represents an important link between
goal-setting and reward systems.
3. Reward systems. This intervention involves the design of organizational rewards to
improve employee satisfaction and performance. It includes innovative approaches
to pay, promotions, and fringe benefits.
Chapter 16 focuses on these change methods for managing, developing, and retain-
ing organizational talent:
1. Coaching and mentoring. This intervention helps executives and employees to clar-
ify their goals, deal with potential stumbling blocks, and improve their performance.
It often involves a one-on-one relationship between the OD practitioner and the
client and focuses on personal learning that gets transferred into organizational
results and more effective leadership skills.
160 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
2. Management and leadership development. Among the oldest strategies for organi-
zational change, training and development interventions increase organization mem-
bers’ skills and knowledge. The focus of these interventions is on building the
competencies needed to lead the organization in the future and includes traditional
classroom lectures as well as simulations, action learning, and case studies.
3. Career planning and development. This intervention helps people choose organiza-
tions and career paths and attain career objectives. It generally focuses on managers
and professional staff and is seen as a way to increase the retention of valuable
employees and to improve the quality of work life.
Chapter 17 describes interventions for supporting organization members:
1. Managing workforce diversity. This change program makes human resources prac-
tices more responsive to a variety of individual needs. Important trends, such as the
increasing number of women, ethnic minorities, and physically and mentally chal-
lenged people in the workforce, require a more flexible set of policies and practices.
2. Employee stress and wellness. These interventions include employee assistance pro-
grams (EAPs) and stress management. EAPs are counseling programs that help
employees deal with substance abuse and mental health, marital, and financial
problems that often are associated with poor work performance. Stress-management
programs help employees cope with the negative consequences of stress at work.
They help people reduce specific sources of stress, such as role conflict and ambiguity,
and provide methods for reducing such stress symptoms as hypertension and anxiety.
7-1d Strategic Change Interventions
Part 6 of the book considers interventions that link the internal functioning of the or-
ganization to the larger environment and transform the organization to keep pace with
changing conditions. These change programs are among the newest additions to OD.
They are implemented organization-wide and bring about a fit between business strategy,
organization design, and the larger environment. The interventions derive from the dis-
ciplines of strategic management, organization theory, economics, and anthropology.
In Chapter 18, we describe the characteristics of transformational change and dis-
cuss interventions that transform the way the organization relates to its environment or
operates internally:
1. Organization design. Organization design interventions address the different elements
that comprise the “architecture” of the organization, including structure, work design,
human resources practices, and management processes. In either domestic or world-
wide settings, organization design aligns these components with the organization’s
strategy and with each other so they mutually direct behavior to execute the strategy.
2. Integrated strategic change. This comprehensive OD intervention describes how
planned change can make a value-added contribution to strategic management. It
argues that business strategies and organizational systems must be changed together
in response to external and internal disruptions. A strategic change plan helps mem-
bers manage the transition between a current strategy and organization design and
the desired future strategy and design.
3. Culture change. This intervention helps an organization develop a culture (beha-
viors, values, beliefs, and norms) appropriate to its strategy and competitive environ-
ment. It focuses on developing a strong organization culture to keep organization
members pulling in the same direction.
CHAPTER 7 DESIGNING INTERVENTIONS 161
Chapter 19 addresses the increasing need for organizations to change continuously
in response to rapidly changing environments. These interventions are designed to sup-
port continuous organizational change:
1. Dynamic strategy making. This intervention helps organizations build a strategic
system that can adapt continually to changing conditions. It involves both the con-
tent (the “what”) of strategy formulation and the process (the “how” and “who”) of
strategy implementation.
2. Self-designing organizations. This change program helps organizations gain the
capacity to alter themselves fundamentally. It is a highly participative process involv-
ing multiple stakeholders in setting strategic directions and designing and imple-
menting appropriate structures and systems. Organizations learn how to design
and implement their own strategic changes.
3. Learning organizations. This intervention involves increasing the organization’s
capability to acquire and develop new knowledge, including how that knowledge
can be organized and used to improve organization performance. These changes
enable organizations to move beyond solving existing problems to learn how to
improve themselves continuously.
4. Built-to-change organizations. This approach to continuous change challenges the
traditional assumption that stability is the key to organizational success. Built-to-
change organizations, on the other hand, assume that the source of effectiveness is
the ability to change continuously. The features, skills and knowledge, and processes
of leading and managing these adaptable organizations are described.
In the final chapter of Part 6, Chapter 20, we describe strategic interventions that
shape how organizations collaborate with each other:
1. Mergers and acquisitions. This intervention describes how OD practitioners can
assist two or more organizations to form a new entity. Addressing key strategic,
leadership, and cultural issues prior to the legal and financial transaction helps to
smooth subsequent operational integration of the organizations.
2. Alliances. This collaborative intervention helps two organizations pursue common
goals through the sharing of resources, including intellectual property, people, capi-
tal, technology, capabilities, or physical assets. Effective alliance development gener-
ally follows a process of strategy formulation, partner selection, alliance structuring
and start-up, and alliance operation and adjustment.
3. Networks. This intervention helps to develop relationships among three or more
organizations to perform tasks or solve problems that are too complex for single
organizations to resolve. It helps organizations recognize the need for partnerships
and develop appropriate structures for implementing them. It also addresses how
to manage change within existing networks.
7-2 What Are Effective Interventions?
OD interventions involve a set of sequenced and planned actions or events intended to
help an organization increase its effectiveness. Interventions purposely disrupt the status
quo; they are deliberate attempts to change an organization or subunit toward a different
and more effective state. Three major criteria define an effective OD intervention: (1) the
extent to which it fits the needs of the organization; (2) the degree to which it is based
on causal knowledge of intended outcomes; and (3) the extent to which it transfers
change management competence to organization members.
162 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
The first criterion concerns the extent to which the intervention is relevant to the
organization and its members. Effective interventions are based on valid information
about the organization’s functioning; they provide organization members with opportu-
nities to make free and informed choices; and they gain members’ internal commitment
to those choices.3
Valid information is the result of an accurate diagnosis of the organization’s function-
ing. It must reflect fairly what organization members perceive and feel about their primary
concerns and issues. Free and informed choice suggests that members are actively involved
in making decisions about the changes that will affect them. This principle also means that
they can choose not to participate and that interventions will not be imposed on them.
This is an important distinction between change management—where a change legiti-
mately can be imposed on people—and OD—where the intent of the change process is
to build capacity for change and increase effectiveness. Internal commitment means that
organization members accept ownership of the intervention and take responsibility for
implementing it. If interventions are to result in meaningful changes, management, staff,
and other relevant members must be committed to carrying them out.
The second criterion of an effective intervention involves knowledge of outcomes.
Because interventions are intended to produce specific results, they must be based on
valid knowledge that those outcomes actually can be produced. Otherwise, there is no
scientific basis for designing an effective OD intervention. Unfortunately—and in con-
trast to other applied disciplines, such as medicine and engineering—knowledge of inter-
vention effects is in a rudimentary stage of development in OD. Much of the evaluation
research lacks sufficient rigor to make strong causal inferences about the success or fail-
ure of change programs. (Chapter 9 discusses how to evaluate OD programs rigorously.)
Moreover, few attempts have been made to examine the comparative effects of different
OD techniques. All of these factors make it difficult to know whether one method is
more effective than another.
Despite these problems, more attempts are being made to assess systematically the
strengths and weaknesses of OD interventions and to compare the impact of different
techniques on organization effectiveness.4 Many of the OD interventions that are dis-
cussed in Parts 3–6 have been subjected to evaluative research, and the chapters explore
the research appropriate to them.
The third criterion of an effective intervention involves the extent to which it
enhances the organization’s capacity to manage change. The values underlying OD sug-
gest that following an intervention, organization members should be better able to carry
out planned change activities on their own. From active participation in designing and
implementing the intervention, they should gain knowledge and skill in managing
change. Competence in change management is essential in today’s environment, where
technological, social, economic, and political changes are rapid and persistent. Many
organizations, such as Capital One, The Hartford, Limited Brands, and Microsoft, recog-
nize this need and are systematically building their change management capabilities.
7-3 How to Design Effective Interventions
Designing OD interventions requires paying careful attention to the needs and dynamics
of the change situation and crafting a change program that will be consistent with
the previously described criteria of effective interventions. Current knowledge of OD
interventions provides only general prescriptions for change. There is scant precise infor-
mation or research about how to design interventions or how they can be expected to
CHAPTER 7 DESIGNING INTERVENTIONS 163
interact with organizational conditions to achieve specific results.5 Moreover, because the
ability to implement most OD interventions is highly dependent on the skills and knowl-
edge of the change agent, the design of an intervention will depend to some extent on
the expertise of the practitioner.
Two major sets of contingencies that can affect intervention success have been dis-
cussed in the OD literature: those having to do with the change situation and those
related to the target of change. Both kinds of contingencies need to be considered in
designing interventions.
7-3a Contingencies Related to the Change Situation
Researchers have identified a number of contingencies present in the change situation
that can affect intervention success. These include individual differences among organi-
zation members (e.g., needs for autonomy), organizational factors (e.g., management
style and technical uncertainty), and dimensions of the change process itself (e.g., degree
of top-management support). Unless these factors are taken into account, designing an
intervention will have little impact on organizational functioning or, worse, it may pro-
duce negative results. For example, to resolve motivational problems among blue-collar
workers in an oil refinery, it is important to know whether interventions intended to
improve motivation (e.g., job enrichment) will succeed with the kinds of people who
work there. In many cases, knowledge of these contingencies results in modifying or
adjusting the change program to fit the setting. In applying a reward-system intervention
to an organization, the changes might have to be modified depending on whether the
firm wants to reinforce individual or team performance.
Although knowledge of contingencies is still at a rudimentary stage of development
in OD, researchers have discovered several situational factors that can affect intervention
success.6 These include specific contingencies for many of the interventions reviewed in
this book, and they will be discussed in respective chapters describing the change pro-
grams. Two additional and generic contingencies related to the country or region’s
national culture and stage of economic development are presented here.
National Culture The applicability and effectiveness of OD in countries outside of the
United States is the subject of intense debate.7 Because OD was developed predominantly
by American and Western European practitioners, its practices and methods are heavily
influenced by the values and assumptions of these Western industrialized cultures. Thus,
traditional approaches to planned change may promote management practices that con-
flict with the values and assumptions of other societies. Will Chinese cultural values, for
example, be preserved or defended as an increasing number of European and American
organizations establish operations in that country? How should OD be conducted in an
Indian firm operating in the United States? On the other hand, some practitioners
believe that OD can result in organizational improvements in any culture.
Researchers have proposed that applying OD in different countries requires a
“context-based” approach to designing interventions.8 This involves fitting the change pro-
cess to the organization’s cultural context, including the values held by members in the
particular country or region. These beliefs inform people about behaviors that are impor-
tant and acceptable in their culture. Cultural values play a major role in shaping the cus-
toms and practices that occur within organizations as well, and influencing how members
react to phenomena having to do with power, conflict, ambiguity, time, and change.
There is a growing body of knowledge about cultural diversity and its effect on
organizational and management practices.9 As shown in Table 7.1, researchers have
164 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
identified five key values that describe national cultures and influence organizational
customs:
1. Context orientation. This value describes how information is conveyed and time is
valued in a culture. In low-context cultures, such as Scandinavia and the United
States, people communicate directly in words and phrases. The more specific the
word, the more meaning is expressed. In addition, time is viewed as discrete and
linear—as something that can be spent, used, saved, or wasted. In high-context cul-
tures, on the other hand, the communication medium reflects the message more
TABLE 7.1
Cultural Values and Organization Customs
Value Definition
Organization Customs When
the Value Is at One Extreme
Representative
Countries
Context The extent to which words
carry the meaning of a
message; how time is
viewed
Ceremony and routines are
common
Structure is less formal; fewer
written policies exist
People are often late for
appointments
High: Asian and Latin
American
countries
Low: Scandinavian
countries, United
States
Power
distance
The extent to which
members of a society
accept that power is
distributed unequally
in an organization
Decision making is autocratic
Superiors consider subordinates
as part of a different class
Subordinates are closely
supervised
Employees are not likely to
disagree
Powerful people are entitled to
privileges
High: Latin American
and Eastern
European countries
Low: Scandinavian
countries
Uncertainty
avoidance
The extent to which
members of an
organization tolerate
the unfamiliar and
unpredictable
Experts have status/authority
Clear roles are
preferred
Conflict is undesirable
Change is resisted
Conservative practices are
preferred
High: Asian countries
Low: European
countries
Achievement
orientation
The extent to which
organization members
value assertiveness
and the acquisition of
material goods
Achievement is reflected in
wealth and recognition
Decisiveness is valued
Larger and faster are better
Gender roles are clearly
differentiated
High: Asian and Latin
American countries,
South Africa
Low: Scandinavian
countries
Individualism The extent to which people
believe they should be
responsible for
themselves and their
immediate families
Personal initiative is encouraged
Time is valuable to individuals
Competitiveness is accepted
Autonomy is highly valued
High: United States
Low: Latin American
and Eastern European
countries
©
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CHAPTER 7 DESIGNING INTERVENTIONS 165
than the words, and time is a fluid and flexible concept. For example, social cues in
Japan and Venezuela provide as much, if not more, information about a particular
situation than do words alone. Business practices in high-context cultures emphasize
ceremony and ritual. For example, knowing how to exchange business cards, partic-
ipate in a reception, or conduct a banquet in China honors the client and facilitates
the business relationship. How one behaves is an important signal of support and
compliance with the way things are done. Structures are less formal in high-context
cultures; there are few written policies and procedures to guide behavior. Because
high-context cultures view time as fluid, punctuality for appointments is less a pri-
ority than is maintaining relationships.
2. Power distance. This value concerns the way people view authority, status differ-
ences, and influence patterns. People in high power-distance regions, such as Latin
America and Eastern Europe, tend to accept unequal distributions of power and
influence, and consequently autocratic and paternalistic decision-making practices
are the norm. Organizations in high power-distance cultures tend to be centralized,
with several hierarchical levels and a large proportion of supervisory personnel.
Subordinates in these organizations represent a lower social class. They expect to
be supervised closely and believe that power holders are entitled to special privileges.
Such practices would be inappropriate in low power-distance regions, such as
Scandinavia, where participative decision making and egalitarian methods prevail.
3. Uncertainty avoidance. This value reflects a preference for conservative practices and
familiar and predictable situations. People in high uncertainty-avoidance regions, such
as Asia, prefer stable routines over change and act to maintain the status quo. They do
not like conflict and believe that company rules should not be broken. In regions where
uncertainty avoidance is low, such as in many European countries, ambiguity is less
threatening. Organizations in these cultures tend to favor fewer rules, higher levels of
participation in decision making, more organic structures, and more risk taking.
4. Achievement orientation. This value concerns the extent to which the culture
favors the acquisition of power and resources. Employees from achievement-oriented
cultures, such as Asia and Latin America, place a high value on career advancement,
freedom, and salary growth. Organizations in these cultures pursue aggressive goals
and can have high levels of stress and conflict. Organizational success is measured
in terms of size, growth, and speed. On the other hand, workers in cultures where
achievement is less of a driving value, such as those in Scandinavia, prize the social
aspects of work, including working conditions and supervision, and typically favor
opportunities to learn and grow at work.
5. Individualism. This value is concerned with looking out for oneself as opposed
to one’s group or organization. In high-individualism cultures, such as the United
States and Australia, personal initiative and competitiveness are valued strongly.
Organizations in individualistic cultures often have high turnover rates and individual
rather than group decision-making processes. Employee empowerment is supported
when members believe that it improves the probability of personal gain. These
cultures encourage personal initiative, competitiveness, and individual autonomy.
Conversely, in low individualism countries, such as China, Japan, and Mexico,
allegiance to one’s group is paramount. Organizations operating in these cultures
tend to favor cooperation among employees and loyalty to the company.
Economic Development In addition to cultural context, an important situational con-
tingency affecting OD success is a country’s level of industrial and economic development.10
For example, although long considered an industrial economy, Russia’s political and
166 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
economic transformation, and the concomitant increases in uncertainties over infrastruc-
ture, corruption, cash flow, and exchange rates, has radically altered assumptions underlying
business practices. Thus, economic development can be judged from social, economic, and
political perspectives.11 For example, a country’s development level can be reflected in its
information systems and skills; decision-making and action-taking capabilities; project plan-
ning and organizing abilities; evaluation and control technologies; leadership, motivational,
and reward systems; and human selection, placement, and development levels. The United
Nations’ Human Development Programme has created a Human Development Index that
assesses a country’s economic development in terms of life expectancy, educational attain-
ment, and adjusted real income.
Researchers have identified three broad stages of economic development:
1. Subsistence economies. Countries such as Pakistan, Nepal, Nigeria, Uganda, and
Rwanda have relatively low degrees of development and their economies are primarily
agriculture-based. Their populations consume most of what they produce, and any
surplus is used to barter for other needed goods and services. A large proportion of
the population is unfamiliar with the concept of “employment.” Working for someone
else in exchange for wages is not common or understood, and consequently few large
organizations exist outside of the government. In subsistence economies, OD interven-
tions emphasize global social change and focus on creating conditions for sustainable
social and economic progress. These change methods are described in Chapter 21.
2. Industrializing economies. Malaysia, Venezuela, India, Turkey, the Philippines, Iran,
and the People’s Republic of China are moderately developed and tend to be rich in
natural resources. An expanding manufacturing base that accounts for increasing
amounts of the country’s gross domestic product fuels economic growth. The rise of
manufacturing also contributes to the formation of a class system including upper-,
middle-, and low-income groups. Organizations operating in these nations generally
focus on efficiency of operations and revenue growth. Consequently, OD interventions
address strategic, structural, and work design issues.12 They help organizations identify
domestic and international markets, develop clear and appropriate goals, and structure
themselves to achieve efficient performance and market growth.
3. Industrial economies. Highly developed countries, such as Sweden, Japan, France,
and the United States, emphasize nonagricultural industry. In these economies, man-
ufactured goods are exported and traded with other industrialized countries; invest-
ment funds are available both internally and externally; the workforce is educated
and skilled; and technology is often substituted for labor. Because the OD interven-
tions described in this book were developed primarily in industrial economies, they
can be expected to have their strongest effects in those contexts. Their continued suc-
cess cannot be ensured, however, because these countries are advancing rapidly to
postindustrial conditions. Here, OD interventions will need to fit into economies
driven by information and knowledge, where service outpaces manufacturing, and
where national and organizational boundaries are more open and flexible.
How National Culture and Economic Development Affect OD Interventions The
situational contingencies of national culture and economic development can have power-
ful effects on the way OD interventions are designed and implemented in various coun-
tries.13 They can determine whether change proceeds slowly or quickly; involves few
or many members; is directed by hierarchical authority or by consensus; and focuses
on business, organizational, or human process issues. When the two situational contin-
gencies are considered together, they reveal four different international settings for
CHAPTER 7 DESIGNING INTERVENTIONS 167
OD practice, as shown in Figure 7.1. These different situations reflect the extent to which
a country’s culture fits with traditional OD values of direct and honest communication,
sharing power, and improving their effectiveness and the degree to which the country is
economically developed.14 When the country’s culture supports traditional OD values, OD
interventions can be applied to organizational and human process issues with only small
adjustments.15 The more the cultural context differs from OD’s traditional values profile,
the more the interventions will need to be modified to fit the situation.
In Figure 7.1, the degree of economic development is restricted to industrializing
and highly industrialized regions. Subsistence economies are not included because they
afford little opportunity to practice traditional OD; in those contexts, a more appropriate
strategy is global social change, discussed later in Chapter 21. In general, however, the
more developed the economy, the more OD is applied to the organizational and human
process issues described in this book. In less-developed situations, OD focuses on busi-
ness issues, such as procuring raw materials, producing efficiently, and marketing suc-
cessfully.16 As shown in Figure 7.1, the four international settings include the following:
1. Low cultural fit, moderate industrialization. This context is least suited to tradi-
tional OD practice. It includes industrializing economies with some cultural values
that align poorly with traditional OD values, including many Middle East nations,
such as Iraq, Iran, and the United Arab Emirates; the South Pacific region, including
Malaysia and the Philippines; and certain Central and South American countries,
such as Brazil, Ecuador, Guatemala, and Nicaragua. These regions are highly depen-
dent on their natural resources and have a relatively small manufacturing base. They
tend to be high-context cultures with values of high power-distance and achieve-
ment orientation and of moderate uncertainty avoidance, but they also tend toward
moderate or high levels of collectivism, especially in relation to family.
These settings require OD interventions that fit local customs and that address
business issues. Cultural values of high power-distance and achievement are incon-
sistent with traditional OD activities emphasizing openness, collaboration, and
FIGURE 7.1
The Cultural and Economic Contexts of International OD Practice
Moderate
High
HighLow
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168 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
empowerment. Moreover, executives in industrializing economies frequently equate
OD with human process interventions, such as team building, training, and conflict
management. They often perceive OD as too soft to meet their business needs. For
example, Egyptian and Filipino managers tend to be autocratic, engage in protracted
decision making, and focus on economic and business problems. Consequently,
organizational change is slow paced, centrally controlled, and aimed at achieving
technical rationality and efficiency.17
These contextual forces do not influence all organizations in the same way.
A recent study of 20 large group interventions in Mexico suggests that culture may
not be as constraining as has been hypothesized.18 Similarly, in an apparent exception
to the rule, the president of Semco S/A (Brazil), Ricardo Semler, designed a highly
participative organization.19 Most Semco employees set their own working hours and
approve hires and promotions. Information flows downward through a relatively flat
hierarchy, and strategic decisions are made participatively by companywide vote.
Brazil’s cultural values are not as strong on power distance and masculinity as in
other Latin American countries, and that may explain the apparent success of this
high-involvement organization. It suggests that OD interventions can be implemented
within this cultural context when strongly supported by senior management.
2. High cultural fit, moderate industrialization. This international context includes
industrializing economies with cultures that align with traditional OD values. Such
settings support the kinds of OD processes described in this book, especially technos-
tructural and strategic interventions that focus on business development. According to
data on economic development and cultural values, relatively few countries fit this
context. India’s industrial base and democratic society are growing rapidly and may
fit this contingency. Similarly, South Africa’s recent political and cultural changes
make it one of the most interesting settings in which to practice OD.20
A study of large South African corporations suggests the directions that OD is
likely to take in that setting.21 The study interviewed internal OD practitioners about
key organizational responses to the political changes in the country, such as the free
election of Nelson Mandela, abolishment of apartheid, and the Reconstruction and
Development Program. Change initiatives at Spoornet, Eskom, and Telkom, for
example, centered around two strategic and organizational issues. First, the political
changes opened up new international markets, provided access to new technologies,
and exposed these organizations to global competition. Consequently, these firms
initiated planned change efforts to create corporate visions and to identify strategies
for entering new markets and acquiring new technologies. Second, the political
changes forced corporations to modify specific human resources and organizational
practices. The most compelling change was mandated affirmative action quotas. At
Spoornet, Eskom, and Telkom, apartheid was thoroughly embedded in the organiza-
tions’ structures, policies, and physical arrangements. Thus, planned change focused
on revising human resources policies and practices. Similarly, organizational struc-
tures that had fit well within the stable environment of apartheid were outmoded
and too rigid to meet the competitive challenges of international markets. Planned
changes for restructuring these firms were implemented as part of longer-term strat-
egies to change corporate culture toward more egalitarian and market-driven values.
3. Low cultural fit, high industrialization. This international setting includes industri-
alized countries with cultures that fit poorly with traditional OD values. Many coun-
tries in Central America, Eastern Asia, and Eastern Europe fit this description.
Reviews of OD practice in those regions suggest that planned change includes all
four types of interventions described in this book, although the change process itself
CHAPTER 7 DESIGNING INTERVENTIONS 169
is adapted to local conditions.22 For example, Mexico, Venezuela, China, Japan, and
Korea are high-context cultures where knowledge of local mannerisms, customs, and
rituals is required to understand the meaning of communicated information. To
function in such settings, OD practitioners must know not only the language but
the social customs as well. Similarly, cultural values emphasizing high levels of
power distance, uncertainty avoidance, and achievement orientation foster organiza-
tions where roles, status differences, and working conditions are clear; where auto-
cratic and paternalistic decisions are expected; and where the acquisition of wealth
and influence by the powerful is accepted. OD interventions that focus on social
processes and employee empowerment are not favored naturally in this cultural con-
text and consequently need to be modified to fit the situations.
Japanese and Korean organizations, such as Matsushita, Nissan, Toyota, Fujitsu,
NEC, and Hyundai, provide good examples of how OD interventions can be tailored
to this global setting. These firms are famous for continuous improvement and qual-
ity management practices, and they adapt these interventions to fit the culture. In
Asia, OD is an orderly process, driven by consensus and challenging performance
goals. Organizational changes are implemented slowly and methodically, roles and
behaviors are highly specified so trust builds and change-related uncertainty is
reduced. Teamwork and consensus decision-making practices associated with
quality-improvement projects also help to manage uncertainty. When large numbers
of employees are involved, information is spread quickly and members are kept
informed about the changes taking place. Management controls the change process
by regulating the implementation of suggestions made by the problem-solving
groups. Because these interventions focus on work processes, teamwork and
employee involvement do not threaten the power structure. Moreover, continuous
improvement interventions do not alter the organization radically but produce
small, incremental changes that can add up to impressive gains in long-term pro-
ductivity and cost reduction. Because Asian values promote a cautious culture that
prizes consensus, dignity, and respect, OD tends to be less personal and to focus
mainly on workflow improvements. Human process issues are rarely addressed
because people are expected to act in ways that do not cause others to “lose face”
or to bring shame to the group.
In these cultures, OD practitioners also tailor the change process itself to fit local
conditions. Mexican companies, for example, expect OD practitioners to act as experts
and to offer concrete advice on how to improve the organization. To be successful,
OD practitioners need sufficient status and legitimacy to work with senior manage-
ment and to act in expert roles.23 Status typically is associated with academic creden-
tials, senior management experience, high-level titles, or recommendations by highly
placed executives and administrators. As might be expected, the change process in
Latin America is autocratic and driven downward from the top of the organization.
Subordinates or lower-status people generally are not included in diagnostic or imple-
mentation activities because inclusion might equalize power differences and threaten
the status quo. Moreover, cultural norms discourage employees from speaking out or
openly criticizing management. There is relatively little resistance to change because
employees readily accept changes dictated by management.
4. High cultural fit, high industrialization. This last setting includes industrialized
countries with cultural contexts that fit well with traditional OD values. Much of the
OD practice described in this book was developed in these situations, particularly in
the United States and the United Kingdom,24 and so we focus here on how OD is
practiced in Scandinavian countries—Sweden, Norway, Finland, and Denmark.
170 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
Scandinavians enjoy a high standard of living and strong economic develop-
ment. Because their cultural values most closely match those traditionally espoused
in OD, organizational practices are highly participative and egalitarian. It is not
surprising, then, that Scandinavian companies, including Saab and Volvo, pio-
neered sociotechnical interventions to improve productivity and quality of work
life. Multiple stakeholders, such as governments, managers, unionists, and staff
personnel, actively are involved in all stages of the change process, from entry
and diagnosis to intervention and evaluation. The Norwegian government, for
example, was instrumental in introducing industrial democracy to that nation’s
companies. It helped union and management in selected industries implement
pilot projects to enhance productivity and quality of work life. This level
of involvement is much higher than that typically occurring in the United States.
It results in a change process that is heavily oriented to the needs of all organiza-
tion members. Norwegian labor laws, for example, give unionists the right to
participate in technological innovations that can affect their work lives. Such
laws also mandate that all employees in the country have the right to enriched
forms of work.
7-3b Contingencies Related to the Target of Change
OD interventions often seek to change specific features or parts of organizations. These
targets of change are the main focus of many interventions, and researchers have identi-
fied two key contingencies related to change targets that can affect intervention success:
the organizational issues that the intervention is intended to resolve and the level of
organizational system at which the intervention is expected to have a primary impact.
Organizational Issues Organizations need to address certain issues to operate effec-
tively. Figure 7.2 lists these issues along with the OD interventions that are intended to
resolve them. (The parts and chapters of this book that describe the specific interven-
tions are also identified in the figure.) It shows the following four interrelated issues
that are key targets of OD interventions:
1. Strategic issues. Organizations need to decide what products or services they will
provide and the markets in which they will compete, as well as how to relate to
their environments and how to transform themselves to keep pace with changing
conditions. These strategic issues are among the most critical ones facing organiza-
tions in today’s changing and highly complex environments. Strategic change inter-
ventions address these issues.
2. Technological and structural issues. Organizations must decide how to divide work
into departments and then how to coordinate among those departments to support
strategic directions. They also must make decisions about how to deliver products or
services and how to link people to tasks. Technostructural interventions deal with
these structural and technological issues.
3. Human resources issues. These issues are concerned with attracting talented people
to the organization, setting goals for them, appraising and rewarding their perfor-
mance, and ensuring that they develop their careers and sustain their wellness.
Human resources management interventions attend to these issues.
4. Human process issues. These issues have to do with social processes occurring
among organization members, such as communication, decision making, leadership,
and group dynamics. Human process interventions focus on these kinds of issues.
CHAPTER 7 DESIGNING INTERVENTIONS 171
FIGURE 7.2
Types of OD Interventions and Organizational Issues
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172 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
Consistent with systems theory as described in Chapter 5, these organizational issues are
interrelated and need to be integrated with one another. The double-headed arrows
connecting the different issues in Figure 7.2 represent the fits or linkages among them.
Organizations need to match answers to one set of questions with answers to other sets of
questions to achieve high levels of effectiveness. For example, decisions about gaining
competitive advantage need to fit with choices about organization structure, setting goals for
and rewarding people, communication, and problem solving.
The interventions presented in this book are intended to resolve these different con-
cerns. As shown in Figure 7.2, particular OD interventions apply to specific issues. Thus,
intervention design must create change methods appropriate to the organizational issues
identified in diagnosis. Moreover, because the organizational issues are themselves linked
together, OD interventions similarly need to be integrated with one another. For example, a
goal-setting intervention that tries to establish motivating goals may need to be integrated
with supporting interventions, such as a reward system that links pay to goal achievement.
The key point is to think systemically.25 Interventions aimed at one kind of organi-
zational issue will invariably have repercussions on other kinds of issues. Careful think-
ing about how OD interventions affect the different kinds of issues and how different
change programs might be integrated to bring about a broader and more coherent
impact on organizational functioning is critical to effective OD intervention.
Organizational Levels In addition to facing interrelated issues, organizations function
at different levels: individual, group, organization, and transorganization. Thus, organi-
zational levels are targets of change in OD. Table 7.2 lists OD interventions in terms of
the level of organization that they primarily affect. For example, some technostructural
interventions affect mainly individual jobs and groups (e.g., work design), whereas others
impact primarily the total organization (e.g., structural design).
It is important to emphasize that only the primary level affected by the intervention
is identified in Table 7.2. Many OD interventions also have a secondary impact on the
other levels. For example, structural design affects mainly the organization level, but it
can have an indirect effect on groups and individual jobs because it sets the broad para-
meters for designing work groups and jobs. Again, practitioners need to think systemi-
cally. They must design interventions to apply to specific organizational levels, address
the possibility of cross-level effects, and integrate interventions affecting different levels
to achieve overall success.26 For example, an intervention to create self-managed work
teams may need to be linked to organization-level changes in measurement and reward
systems to promote team-based work.
SUMMARY
This chapter discussed designing OD interventions
including the four major types of interventions that are
presented in this book: (1) human process interventions
aimed at people within organizations and their interac-
tion processes; (2) technostructural interventions directed
at organization technology and structures for linking
people and technology; (3) human resource management
interventions focused at integrating people into the
organization successfully; and (4) strategic change inter-
ventions targeted at how the organization uses its
resources to gain a competitive advantage in the larger
environment. Designing OD interventions is based on a
thorough diagnosis of the organization or subunit. Effec-
tive interventions are designed to fit the needs of the
organization, are based on causal knowledge of intended
outcomes, and transfer competence to manage change to
CHAPTER 7 DESIGNING INTERVENTIONS 173
TABLE 7.2
Types of Interventions and Organization Levels
Primary Organization Level Affected
Interventions Individual Group Organization
Human Process (Part 3)
Process consultation X
Third-party interventions X X
Team building X
Organization confrontation meeting X X
Intergroup relations interventions X X
Large group interventions X
Technostructural (Part 4)
Structural design X
Downsizing X
Reengineering X X
Parallel structures X X
Total quality management X X
High-involvement organizations X X X
Work design X X
Human Resources Management (Part 5)
Goal setting X X
Performance appraisal X X
Reward systems X X X
Coaching and mentoring X
Management and leadership development X
Career planning and development
interventions
X
Workforce diversity interventions X X X
Employee stress and wellness interventions X
Strategic (Part 6)
Organization design X
Integrated strategic change X
Culture change X
Dynamic strategy making X
Self-designing organizations X X
Organization learning and knowledge
management
X X
Built-to-change X
Merger-and-acquisition integration X
Strategic alliance interventions X
Network interventions X
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174 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
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8
Managing Change
learni
ng
objectives
Understand the five key elements of successful change management.
Explore the processes of change associated with each element.
A
fter diagnosing reveals the causes of pro-
blems or identifies opportunities for develop-
ment, organization members begin planning
and subsequently implementing the changes nec-
essary to improve organization effectiveness and
performance. A large part of organization devel-
opment (OD) is concerned with interventions for
improving organizations. The previous chapter
discussed the design of interventions and intro-
duced the major ones currently used in OD.
Chapters 10–20 describe those interventions in
detail. This chapter addresses the key activities
associated with successfully managing organiza-
tional changes.
Change can vary in complexity from the intro-
duction of relatively simple processes into a small
work group to transforming the strategies and design
features of the whole organization. Although change
management differs across situations, in this
chapter we discuss activities that must be per-
formed in managing any kind of organizational
change. (Tasks applicable to specific kinds of chan-
ges are examined in the chapters on intervention
in Parts 3–6.)
8-1 Overview of Change Activities
The OD literature has directed considerable attention at managing change. Much of the
material is highly prescriptive, advising managers about how to plan and implement
organizational changes. For example, one study suggested that successful managers in
continuously changing organizations (1) provide employees with clear responsibility
and priorities, including extensive communication and freedom to improvise; (2) explore
the future by experimenting with a wide variety of low-cost probes; and (3) link current
projects to the future with predictable (time-paced rather than event-paced) intervals and
choreographed transition procedures.1 Traditionally, change management has focused on
identifying sources of resistance to change and offering ways to overcome them.2 Other
contributions have challenged the focus on resistance and have been aimed at creating
visions and desired futures, gaining political support for them, and managing the transi-
tion of the organization toward them.3 Still others have described the learning practices
and leader behaviors that accelerate complex change.4
179
The diversity of practical advice for managing change can be organized into five
major activities, as shown in Figure 8.1. The activities contribute to effective change
management and are listed roughly in the order in which they typically are performed.
Each activity represents a key element in change leadership.5 The first activity involves
motivating change and includes creating a readiness for change among organization
members and helping them address resistance to change. Leadership must create an
environment in which people accept the need for change and commit physical and
FIGURE 8.1
Activities Contributing to Effective Change Management
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180 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
psychological energy to it. Motivation is a critical issue in starting change because ample
evidence indicates that people and organizations seek to preserve the status quo and are
willing to change only when there are compelling reasons to do so. The second activity is
concerned with creating a vision and is closely aligned with leadership activities. The
vision provides a purpose and reason for change and describes the desired future state.
Together, they provide the “why” and “what” of planned change. The third activity
involves developing political support for change. Organizations are composed of powerful
individuals and groups that can either block or promote change, and leaders and change
agents need to gain their support to implement changes. The fourth activity is concerned
with managing the transition from the current state to the desired future state. It involves
creating a plan for managing the change activities as well as planning special manage-
ment structures for operating the organization during the transition. The fifth activity
involves sustaining momentum for change so that it will be carried to completion. This
includes providing resources for implementing the changes, building a support system
for change agents, developing new competencies and skills, and reinforcing the new
behaviors needed to implement the changes.
Each of the activities shown in Figure 8.1 is important for managing change.
Although little research has been conducted on their relative contributions, leaders
must give careful attention to each activity when planning and implementing organiza-
tional change. Unless individuals are motivated and committed to change, getting move-
ment on the desired change will be extremely difficult. In the absence of vision, change is
likely to be disorganized and diffuse. Without the support of powerful individuals and
groups, change may be blocked and possibly sabotaged. Unless the transition process is
managed carefully, the organization will have difficulty functioning while it moves from
the current state to the future state. Without efforts to sustain momentum for change,
the organization will have problems carrying the changes through to completion. Thus,
all five activities must be managed effectively to realize success.
In the following sections of this chapter, we discuss more fully each of these change
activities, directing attention to how leaders contribute to planning and implementing
organizational change.
8-2 Motivating Change
Organizational change involves moving from the known to the unknown. Because the
future is uncertain and may adversely affect people’s competencies, worth, and coping
abilities, organization members generally do not support change unless compelling rea-
sons convince them to do so. Similarly, organizations tend to be heavily invested in the
status quo, and they resist changing it in the face of uncertain future benefits. Conse-
quently, a key issue in planning for action is how to motivate commitment to organiza-
tional change. As shown in Figure 8.1, this requires attention to two related tasks:
creating readiness for change and overcoming resistance to change.
8-2a Creating Readiness for Change
One of the more fundamental axioms of OD is that people’s readiness for change
depends on creating a felt need for change. This involves making people so dissatisfied
with the status quo that they are motivated to try new work processes, technologies,
or ways of behaving. Creating such dissatisfaction can be difficult, as anyone knows
who has tried to lose weight, stop smoking, or change some other habitual behavior.
CHAPTER 8 MANAGING CHANGE 181
Generally, people and organizations need to experience deep levels of hurt before they
will seriously undertake meaningful change. For example, IBM, Harley-Davidson, and
Sears experienced threats to their very survival before they undertook significant
change programs. The following three methods can help generate sufficient dissatisfac-
tion to produce change:
1. Sensitize organizations to pressures for change. Innumerable pressures for change
operate both externally and internally to organizations. As described in Chapter 1,
modern organizations face unprecedented environmental pressures to change them-
selves, including heavy foreign competition, rapidly changing technology, and volatile
global economies. Internal pressures to change include new leadership, poor product
quality, high production costs, and excessive employee absenteeism and turnover.
Before these pressures can serve as triggers for change, however, organizations must
be sensitive to them. The pressures must pass beyond an organization’s threshold of
awareness if managers are to respond to them. Many organizations, such as Kodak,
Polaroid, and Northwest Airlines, set their thresholds of awareness too high and
neglected pressures for change until those pressures reached disastrous levels.6
Organizations can make themselves more sensitive to pressures for change by
encouraging leaders to surround themselves with devil’s advocates; by cultivating
external networks that comprise people or organizations with different perspectives
and views; by visiting other organizations to gain exposure to new ideas and meth-
ods; and by using external standards of performance, such as competitors’ progress
or benchmarks, rather than the organization’s own past standards of performance.7
At Wesley Long Community Hospital, in Greensboro, North Carolina, for example,
managers visited the Ritz-Carlton Hotel, Marconi Commerce Systems’ high-
involvement plant, and other hospitals known for high quality to gain insights
about revitalizing their own organization.
2. Reveal discrepancies between current and desired states. In this approach to gener-
ating a felt need for change, information about the organization’s current functioning
is gathered and compared with desired states of operation. (See Section 8-3 “Creating
a Vision,” on page 184, for more information about desired future states.) These
desired states may include organizational goals and standards, as well as a vision of a
more desirable future state.8 Significant discrepancies between actual and ideal states
can motivate organization members to initiate corrective changes, particularly when
members are committed to achieving those ideals. A major goal of diagnosing, as
described in Chapter 5, is to provide members with feedback about current organiza-
tional functioning so that the information can be compared with goals or with desired
future states. Such feedback can energize action to improve the organization. At Waste
Management, Sunbeam, and Banker’s Trust, for example, financial statements had
reached the point at which it was painfully obvious that drastic renewal was needed.9
3. Convey credible positive expectations for the change. Organization members invari-
ably have expectations about the results of organizational changes. The positive
approaches to planned change described in Chapter 2 suggest that these expectations
can play an important role in generating motivation for change.10 Expectations can
serve as a self-fulfilling prophecy, leading members to invest energy in change pro-
grams that they expect will succeed. When members expect success, they are likely
to develop greater commitment to the change process and to direct more energy into
the constructive behaviors needed to implement it.11 The key to achieving these posi-
tive effects is to communicate realistic, positive expectations about the organizational
changes. Research suggests that information about why the change is occurring, how it
182 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
will benefit the organization, and how people will be involved in the design and
implementation of the change was most helpful.12 Organization members also can be
taught about the benefits of positive expectations and be encouraged to set credible
positive expectations for the change program.
8-2b Overcoming Resistance to Change
Change can generate deep resistance in people and in organizations, thus making it dif-
ficult, if not impossible, to implement organizational improvements.13 At a personal
level, change can arouse considerable anxiety about letting go of the known and moving
to an uncertain future.14 People may be unsure whether their existing skills and contri-
butions will be valued in the future, or may have significant questions about whether
they can learn to function effectively and to achieve benefits in the new situation. At
the organization level, resistance to change can come from three sources.15 Technical
resistance comes from the habit of following common procedures and the consideration
of sunk costs invested in the status quo. Political resistance can arise when organizational
changes threaten powerful stakeholders, such as top executive or staff personnel, or call
into question the past decisions of leaders.16 Organization change often implies a differ-
ent allocation of already scarce resources, such as capital, training budgets, and talented
people. Finally, cultural resistance takes the form of systems and procedures that rein-
force the status quo, promoting conformity to existing values, norms, and assumptions
about how things should operate.
There are at least three major strategies for positively dealing with resistance to
change:17
1. Empathy and support. A first step in overcoming resistance is learning how people are
experiencing change. This strategy can identify people who are having trouble accept-
ing the changes, the nature of their resistance, and possible ways to overcome it, but it
requires a great deal of empathy and support. It demands a willingness to suspend
judgment and to see the situation from another’s perspective, a process called active
listening. When people feel that those people who are responsible for managing change
are genuinely interested in their feelings and perceptions, they are likely to be less
defensive and more willing to share their concerns and fears. This more open relation-
ship not only provides useful information about resistance, but also helps establish the
basis for the kind of joint problem solving needed to overcome barriers to change.
2. Communication. People resist change when they are uncertain about its conse-
quences. Lack of adequate information fuels rumors and gossip and adds to the anx-
iety generally associated with change. Effective communication about changes and
their likely results can reduce this speculation and allay unfounded fears. It can
help members realistically prepare for change. However, communication is also one
of the most frustrating aspects of managing change. Organization members con-
stantly receive data about current operations and future plans as well as informal
rumors about people, changes, and politics. Managers and OD practitioners must
think seriously about how to break through this stream of information. One strategy
is to make change information more salient by communicating through a new or
different channel. If most information is delivered through memos and emails,
then change information can be delivered through meetings and presentations.
Another method that can be effective during large-scale change is to deliberately
substitute change information for normal operating information. This sends a
message that changing one’s activities is a critical part of one’s job.
CHAPTER 8 MANAGING CHANGE 183
3. Participation and involvement. One of the oldest and most effective strategies for
overcoming resistance is to involve organization members directly in planning and
implementing change. Participation can lead both to designing high-quality changes
and to overcoming resistance to implementing them.18 Members can provide a
diversity of information and ideas, which can contribute to making the innovations
effective and appropriate to the situation. They also can identify pitfalls and barriers
to implementation. Involvement in planning the changes increases the likelihood
that members’ interests and needs will be accounted for during the intervention.
Consequently, participants will be committed to implementing the changes because
doing so will suit their interests and meet their needs. Moreover, for people having
strong needs for involvement, the act of participation itself can be motivating, lead-
ing to greater effort to make the changes work.19
Application 8.1 describes how an OD consultant helped the sexual violence preven-
tion unit of the Minnesota Department of Health generate commitment to a change
process when the unit’s leader left shortly after the change process began.20
8-3 Creating a Vision
The second activity in managing change involves creating a vision of what members
want the organization to look like or become. It is one of the most popular yet least
understood practices in management.21 Generally, a vision describes the core values
and purpose that guide the organization as well as an envisioned future toward which
change is directed. It provides a valued direction for designing, implementing, and asses-
sing organizational changes. The vision also can energize commitment to change by pro-
viding members with a common goal and a compelling rationale for why change is
necessary and worth the effort. However, if the vision is seen as impossible or promotes
changes that the organization cannot implement, it actually can depress member motiva-
tion. For example, George H. W. Bush’s unfulfilled “thousand points of light” vision was
emotionally appealing, but it was too vague and contained little inherent benefit. In con-
trast, John Kennedy’s vision of “putting a man on the moon and returning him safely to
the earth” was just beyond engineering and technical feasibility. In the context of the
1960s, it was bold, alluring, and vivid; it provided not only a purpose but a valued direc-
tion for the country. Recent research suggests that corporations with carefully crafted
visions can significantly outperform the stock market over long periods of time.22
Creating a vision is considered a key element in most leadership frameworks.23
Organization or subunit leaders are responsible for effectiveness, and they must take an
active role in describing a desired future and energizing commitment to it. In the best
cases, leaders encourage participation in developing the vision to gain wider input and
support. For example, they involve subordinates and others who have a stake in the
changes. The popular media frequently offer accounts of executives who have helped to
mobilize and direct organizational change, including Sergio Marchionne at Fiat and
Louis Gerstner at IBM. Describing a desired future is no less important for people lead-
ing change in small departments and work groups than for senior executives. At lower
organizational levels, there are ample opportunities to involve employees directly in the
visioning process.
Developing a vision is heavily driven by people’s values and preferences for what the
organization should look like and how it should function. The envisioned future repre-
sents people’s ideals or dreams of what they would like the organization to look like or
become. Unfortunately, dreaming about the future is discouraged in most organizations
184 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
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1 MOTIVATING CHANGE IN THE SEXUAL VIOLENCEPREVENTION UNIT OF MINNESOTA’S
HEALTH DEPARTMENT
A
ddressing the prevention of sexual vio-
lence is a complex challenge. Unlike ciga-
rette smoking or automobile accidents,
sexual violence is not only a health issue,
but also a social issue connected to people’s
attitudes, beliefs, norms, and taboos. The sex-
ual violence prevention unit of Minnesota’s
health department decided to undertake a five-
year strategic planning effort to address the “pri-
mary prevention” of sexual violence. Primary
prevention is defined as activities that focus
on preventing sexual violence before it occurs.
While there have been numerous successful
programs focused on dealing with victims or
addressing what happens after an assault,
there was a clear need for primary prevention.
There were two driving forces for the plan.
First, the U.S. Centers for Disease Control had
identified sexual violence as a key health issue
and was providing grants to states for the devel-
opment of primary prevention plans. Second,
Minnesota was a recognized leader in sexual vio-
lence prevention. The health department worked
closely with the Minnesota Coalition Against
Sexual Violence (MNCASA), a primary recipient
of state funding, and other stakeholders who
were working on sexual violence prevention.
This coalition had been meeting for several
years to develop education in primary prevention
and to engage in a cross-sector dialogue on
the issue.
The two primary objectives of the project
were to:
• Create a strategic plan for the primary pre-
vention of sexual violence in the state of
Minnesota.
• Mobilize a broad range of individuals and
organizations to take action in the primary
prevention of sexual violence.
This application describes the activities
involved with motivating change within the sex-
ual violence prevention unit to create the strate-
gic planning process. Application 8.3 describes
the activities associated with managing the
various stakeholders involved with this change
and the large group intervention that kicked off
the strategic planning and implementation effort.
BEGINNING THE PROJECT
The sexual violence prevention unit hired a
local OD consulting firm to facilitate the strate-
gic planning process. Everyone in the unit
believed that strategic planning was the next
right step. Community members wanted
action. In fact, they had stopped meeting in a
dialogue forum because they felt they were
not making progress in addressing the issue
systemically or strategically.
The project got off to a rough start. The day
after the OD consultants began working with the
unit, the unit director resigned. She had been a
major force in bringing the project to fruition, and
her departure represented a key challenge for
the consultants. In the interim, the unit’s pro-
gram director and administrator stepped in to
provide content leadership with the help of the
director of MNCASA. Her departure also created
a strong need to mobilize the members of the
unit and to recruit the necessary external stake-
holders with content knowledge and community
reputation to galvanize action in the community.
To focus the key stakeholders on the
change effort, the OD consultants met with
the departing director to identify a range of com-
munity stakeholders to interview. The inter-
views were critical in building the consultants’
knowledge of the issue and quickly establishing
relationships with key stakeholders. They also
helped identify community members who
could provide leadership on the project.
MOTIVATING COMMITMENT
As part of the effort to reinforce commitment to
the change process, a steering committee was
formed. It consisted of project leaders from the
health department, the OD consultants, and six
community members. This committee was
responsible for identifying and recruiting other
CHAPTER 8 MANAGING CHANGE 185
because it requires creative and intuitive thought processes that tend to conflict with the
rational, analytical methods prevalent there.24 Consequently, leaders may need to create
special conditions in which to describe a desired future, such as off-site workshops or
exercises that stimulate creative thinking.
Research suggests that compelling visions are composed of two parts: (1) a core
ideology or relatively stable identity that describes the organization’s core values and
purpose and (2) an envisioned future with bold goals and a vivid description of the
desired future state that reflects the specific change under consideration.25
8-3a Describing the
Core Ideology
The fundamental basis of a vision for change is the organization’s core ideology. It
describes the organization’s core values and purpose and is relatively stable over time.
Core values typically include three to five basic principles or beliefs that have stood the
test of time and best represent what the organization stands for. Although the vision ulti-
mately describes a desired future, it must acknowledge the organization’s historical
roots—the intrinsically meaningful core values and principles that have guided and will
guide the organization over time. Core values are not “espoused values”; they are the
“values-in-use” that actually inform members what is important in the organization.
The retailer Nordstrom, for example, has clear values around the importance of cus-
tomer service; toymaker Lego has distinct values around the importance of families;
and the Disney companies have explicit values around wholesomeness and imagination.
These values define the true nature of these firms and cannot be separated from them.
Thus, core values are not determined or designed; they are discovered and described
through a process of inquiry.
internal and external stakeholders to participate in
the planning process. They also served as advisors
to the OD consultants on selecting the best forum
to conduct the planning, reviewing draft agendas,
and providing feedback on plan drafts. They were
asked to convene for two meetings as well as pro-
vide input on plans and written reports virtually.
All of the steering committee members were
volunteers recruited by the project leaders and OD
consultants after the initial interviews. The OD consul-
tants were part of the identification and recruitment
process because they had formed relationships with
several of the members through previous work and
had established strong rapport through their inter-
views. The community members of the committee
were chosen not only because of their expertise and
history in the field, locally and nationally, but also
because they had good process skills. Another
criterion for participation was diversity. It was impor-
tant that this group include members who could
speak for underrepresented groups, such as Native
American, Hispanic, African American, and youth seg-
ments. Everyone who was asked to participate
wanted to be part of this effort.
Despite this high level of commitment to the
project, time was a big constraint. To use time
well, the consultants asked for two meetings. In
between meetings, they drafted proposals for the
group to react to, rather than asking members to
decide on the work to be done by the group. When
members could not be at a meeting, the consul-
tants got their input individually, both before and
after the meeting. Because of their commitment
to prevention, all of the steering committee mem-
bers stayed in close contact with the consultants
and responded promptly to all requests.
186 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
Members can spend considerable time and energy discovering their organization’s
core values through long discussions about organizational history, key events, founder’s
beliefs, the work people actually do, and the “glue” that holds the organization together.26
In many cases, organizations want the core values to be something they are not. For
example, many U.S. firms want “teamwork” to be a core value despite strong cultural
norms and organizational practices that promote individuality.
The organization’s core purpose is its reason for being, the idealistic motivation that
brings people to work each day and gives work meaning.27 A core purpose is not a strat-
egy. Purpose describes why the organization exists and the organization’s understanding
of its image, brand, and reputation; strategy describes how an objective will be achieved.
Research suggests that organization purposes may fall into one of four categories and
that organizations often create a slogan or metaphor that captures the real reason they
are in business.28 Heroism refers to a purpose that exhorts members to do great things.
Dell Computer, Microsoft, and Ford were all founded to change the world for the better.
Henry Ford wanted to “build a machine to improve the world.” Discovery, a core pur-
pose for Apple, Sony, and 3M, refers to an innate desire to learn new things. A third
purpose, altruism, infers a belief in serving others. Disney’s return to prominence in the
late 1980s and 1990s was guided by the essential purpose of “making people happy” and
Whole Foods, Ben and Jerry’s, and The Body Shop all take on the responsibility of serv-
ing the greater good. Tata Corporation’s purpose of “what India needs next” has sup-
ported their growth for over 100 years. Finally, Berkshire Hathaway and Toyota reflect
the purpose of excellence.
Hatch’s concept of organization identity is similar to purpose and core ideology.29
Identity—the way core values, purpose, brand, and reputation are integrated—provides
guidelines for the strategic choices that will work and can be implemented versus those
that will not work because they contradict the true nature of the organization. Lawler
and Worley suggested that the real power of an organization’s identity was its ability to
consistently support and encourage change even though identity itself remained fairly
stable.30 An envisioned future can be compelling and emotionally powerful to members
only if it aligns with and supports the organization’s core values, purpose, and identity.31
8-3b Constructing the Envisioned Future
The core ideology provides the context for the envisioned future. Unlike core values
and purpose, which are stable aspects of the organization and must be discovered, the
envisioned future is specific to the change project at hand and must be created.
The envisioned future varies in complexity and scope depending on the changes being
considered. A relatively simple upgrading of a work group’s word-processing software
requires a less complex envisioned future than the transformation of a government
bureaucracy.
The envisioned future typically includes the following two elements that can be
communicated to organization members:32
1. Bold and valued outcomes. Descriptions of envisioned futures often include specific
performance and human outcomes that the organization or unit would like to
achieve. These valued outcomes can serve as goals for the change process and stan-
dards for assessing progress. For example, BHAGs (Big, Hairy, Audacious Goals) are
clear, tangible, energizing targets that serve as rallying points for organization action.
They can challenge members to meet clear target levels of sales growth or customer
satisfaction, to overcome key competitors, to achieve role-model status in the industry,
CHAPTER 8 MANAGING CHANGE 187
or to transform the organization in some meaningful way. For example, in 1990,
Wal-Mart Stores made a statement of intent “to become a $125 billion company
by the year 2000.” (Revenue in 2012 exceeded $445 billion.) Following the downsiz-
ing of the U.S. military budget, Rockwell proposed the following bold outcome for
its change efforts: “Transform this company from a defense contractor into the best
diversified high-technology company in the world.”
2. Desired future state. This element of the envisioned future specifies, in vivid detail,
what the organization should look like to achieve bold and valued outcomes. It is a
passionate and engaging statement intended to draw organization members into the
future. The organizational features described in the statement help define a desired
future state toward which change activities should move. This aspect of the visioning
process is exciting and compelling. It seeks to create a word picture that is emotion-
ally powerful to members and motivates them to change.
Application 8.2 describes how Premier recognized the need for change and built a
vision of the future for their organization.33
8-4 Developing Political Support
From a political perspective, organizations can be seen as loosely structured coalitions of
individuals and groups having different preferences and interests.34 For example, shop-
floor workers may want secure, high-paying jobs, and top executives may be interested
in diversifying the organization into new businesses. The marketing department might be
interested in developing new products and markets, and the production department may
want to manufacture standard products in the most efficient ways. These different
groups or coalitions compete with one another for scarce resources and influence.
They act to preserve or enhance their self-interests while managing to arrive at a suffi-
cient balance of power to sustain commitment to the organization and achieve overall
effectiveness.
Given this political view, attempts to change the organization often threaten the bal-
ance of power among groups, thus resulting in political conflicts and struggles.35 Indivi-
duals and groups will be concerned with how the changes affect their own power and
influence, and they will act accordingly. Some groups will become less powerful; others
will gain influence. Those whose power is threatened by the change will act defensively
and seek to preserve the status quo. For example, they may try to present compelling
evidence that change is unnecessary or that only minor modifications are needed. On
the other hand, those participants who will gain power from the changes will push
heavily for them, perhaps bringing in seemingly impartial consultants to legitimize the
need for change. Consequently, significant organizational changes are frequently accom-
panied by conflicting interests, distorted information, and political turmoil.
Methods for managing the political dynamics of organizational change are relatively
recent additions to OD. Traditionally, OD has neglected political issues mainly because
its humanistic roots promoted collaboration and power sharing among individuals and
groups.36 Today, change agents are paying increased attention to power and political
activity, particularly as they engage in strategic change involving most parts and features
of organizations. Some practitioners are concerned, however, about whether power and
OD are compatible.
A growing number of advocates suggest that OD practitioners can use power in pos-
itive ways.37 They can build their own power base to gain access to other power holders
within the organization. Without such access, those who influence or make decisions
188 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
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2 CREATING A VISION AT PREMIER
P
remier (www.premierinc.com) is a leading
health care alliance collectively owned by
more than 200 independent hospitals and
health care systems in the United States.
Together, the owners operate or are affiliated
with nearly 1,500 hospitals and other health
care sites. Premier resulted from the 1995
merger of Chicago-based Premier Health
Alliance, San Diego-based American Healthcare
Systems, and The SunHealth Alliance of
Charlotte, North Carolina. Premier offers a
comprehensive array of services and products
through its companies and business units,
including group purchasing, consulting services,
technology management services, insurance
services, benchmarking and market intelligence
services, and legislative advocacy.
Two and a half years after the organiza-
tion’s formation, a comprehensive organiza-
tional assessment suggested that Premier
had not been successful in establishing a com-
mon organizational culture. Many of its ser-
vices and employees continued to operate in
a fractured or isolated fashion relating largely
to their prior organization and its geographic
location. As a result, Premier’s strategy and
business model were poorly understood, and
more importantly, not well implemented. The
assessment pointed to a growing lack of trust
in the organization. Premier executives con-
ceded that the organization was culturally adrift
and without a well-understood or widely
accepted sense of direction.
Another key finding of the assessment
concerned the organization’s vision. Shortly
after the merger, a new set of values,
mission, and vision statements had been
developed. The statements themselves were
clear and compelling; however, they had been
developed by a relatively small group of
executives. At best, most employees did not
feel much ownership of the values; at worst,
they saw the failure of top management
to behave consistently with the values as evi-
dence that they were not trusted, supported,
or important.
In the fall of 1997, Premier hired Richard
Norling as COO. Norling had been a chief exec-
utive at one of the health care systems that
owned Premier, and his arrival signaled the
potential for change and new possibilities. At
his former organization, Norling had initiated
and sustained a comprehensive OD effort,
based on identifying core organizational values
and the behaviors that supported them. The
experience of that health care system had
demonstrated that core values shaped and
accepted by an organization’s employees
could build a deep sense of community in the
organization, and lead to greater levels of trust
and commitment that could be harnessed to
enhance organization performance and effec-
tiveness. Given Premier’s emerging problem,
a similar approach made sense.
In the spring of 1998, Premier executives
determined to address these issues by building
on the values and mission statements that had
been developed earlier. Their intent was to
involve a large number of employees in validating
Premier’s values, specifying the behaviors that
supported them, and identifying ways in which
the values could be integrated into the routines
and processes of the organization—all of which
would (they hoped) infect the organization with a
renewed sense of identity and enthusiasm.
The first step in Premier’s change process
was planning and conducting a three-day
values conference with over 200 employees.
The conference was designed by a team of
employees representing a diagonal slice of
the organization and assisted by an OD practi-
tioner. At the conference, employees exam-
ined Premier’s business model and their
organizational culture; developed and recom-
mended a set of core organizational values
for the organization; crafted an envisioned
future; and identified and proposed strategies
for employee involvement, integration, and
organization transformation companywide.
Following the conference, the team of
Premier employees who had planned the
meeting was asked to become a permanent
CHAPTER 8 MANAGING CHANGE 189
committee, charged with refining and implement-
ing plans and recommendations that the confer-
ence participants had generated.
Ultimately, input was obtained from over 60%
of the workforce and 16 actions were recom-
mended and approved by senior management.
Some of those actions included:
• Incorporating the values into Premier’s perfor-
mance management/performance appraisal
system
• Incorporating the values into the recruitment and
selection process by developing sample inter-
view questions for use by hiring managers
aimed at helping them learn whether prospective
employees would be a good match to Premier’s
organizational culture
• Instituting an annual meeting of approximately
200 employees from all parts of Premier mod-
eled after the 1998 values conference. The
agenda would be focused on business issues,
strategy, and organizational culture and values.
Rotate those invited so that every Premier
employee has an opportunity to attend every
three to five years.
The outcome of the vision and values effort
follows:
FOUNDATION STATEMENTS
Core Ideology
Core Values
• Integrity of the individual and the enterprise
• A passion for performance and a bias for
action, creating real value for all stakeholders,
and leading the pace
• Innovation: seeking breakthrough opportunities,
taking risks, and initiating meaningful change
• Focus on people: showing concern and respect
for all with whom we work, building collab-
orative relationships with the community, our
customers, coworkers, and business associates
Core Purpose
To improve the health of communities
Core Roles of the Enterprise
• Improve quality, reduce costs
• Improve financial health
• Create value for owners
• Improve organizational health
• Facilitate knowledge transfer
• Grow the enterprise
Envisioned Future
10–30 Year Goal
Premier’s owners will be the leading health care systems in their markets, and, with them,
Premier will be the major influence in reshaping health care
Vivid Description
By the year 2020, we will have changed the world’s
view of U.S. health care to “the best and most cost-
effective” at sustaining the good health of popula-
tions. In the United States, the health care industry
will be considered the best managed and most
innovative of all the economic sectors.
Across the nation, our owners, physicians, and
other allies will lead the local transformations that
are the building blocks of a reshaped health care
system. These transformations will begin to make
public health and health services indistinguishable,
engaging citizens and civic resources in endeavors
that attack the causes of illness and injury. Through
efforts that go far beyond providing treatment,
people will have a sense of responsibility for their
own personal health and the health of their
communities.
Together in Premier, we will invent new and
superior models of delivering health services, and
we will leverage the size, linkages, and resources
of Premier to deliver those services to more
people, at a lower cost and higher quality, than
any others will. Our owners will operate at costs
190 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
may not have the advantage of an OD perspective. OD practitioners can use power strat-
egies that are open and aboveboard to get those in power to consider OD applications.
They can facilitate processes for examining the uses of power in organizations and help
power holders devise more creative and positive strategies than political bargaining,
deceit, and the like. They can help power holders confront the need for change and can
help ensure that the interests and concerns of those with less power are considered.
Although OD professionals can use power constructively in organizations, they probably
will continue to be ambivalent and tense about whether such uses promote OD values
and ethics or whether they represent the destructive, negative side of power. That tension
seems healthy, and we hope that it will guide the wise use of power in OD.
As shown in Figure 8.2, managing the political dynamics of change includes the fol-
lowing activities: assessing the change agent’s power, identifying key stakeholders, and
influencing stakeholders.
in the lowest quarter among all similar orga-
nizations at quality levels in the highest quarter.
We will research and use the most effective and
seamless clinical approaches to achieve superior
health outcomes and increased values. Our com-
petitive edge will be the unmatched ability to
transfer and act on our collective experience and
innovation.
Our owners will earn recognition as the most
valued community resource for health. As a result of
their efforts, “Premier” will be viewed as the hall-
mark of quality and value that all others seek to
emulate. When people see our emblem, they will
associate it with health care improvement and
advances in health status.
Demonstrating a better way and supported by
our constituencies, we will build consensus for
national policy directions that stimulate and reward
health and healthy communities.
We will indeed be premier.
FIGURE 8.2
Sources of Power and Power Strategies
SOURCE: Power and Organization Development: Mobilizing Power to Implement Change (Prentice
Hall Organizational Development Series), 1st Ed. By Greiner, Larry E.; Schein, Virginia E., ISBN
0201121859. © 1988 Addison-Wesley Publishing Company Inc.
CHAPTER 8 MANAGING CHANGE 191
8-4a Assessing Change Agent Power
The first task is to evaluate the change agent’s own sources of power. This agent may be
the leader of the organization or department undergoing change, or he or she may be the
OD practitioner if professional help is being used. By assessing their own power base,
change agents can determine how to use it to influence others to support changes.
They also can identify areas in which they need to enhance their sources of power.
Greiner and Schein, in the first OD book written entirely from a power perspec-
tive, identified three key sources of personal power in organizations (in addition to
one’s formal position): knowledge, personality, and others’ support.38 Knowledge
bases of power include having expertise that is valued by others and controlling impor-
tant information. OD professionals typically gain power through their expertise in
organizational change. Personality sources of power can derive from change agents’
charisma, reputation, and professional credibility. Charismatic leaders can inspire
devotion and enthusiasm for change from subordinates. OD consultants with strong
reputations and professional credibility can wield considerable power during organiza-
tional change. Others’ support can contribute to individual power by providing access
to information and resource networks. Others also may use their power on behalf of
the change agent. For example, leaders in organizational units undergoing change can
call on their informal networks for resources and support, and encourage subordinates
to exercise power in support of the change.
8-4b Identifying Key Stakeholders
Having assessed their own power bases, change agents should identify powerful indivi-
duals and groups with an interest in the changes, such as staff groups, unions,
departmental managers, and top-level executives. These key stakeholders can thwart
or support change, and it is important to gain broad-based support to minimize the
risk that a single interest group will block the changes. As organizations have become
more global, networked, and customer-focused, and change has become more strategic,
it is also important to identity key external stakeholders. Key customers, regulatory
agencies, suppliers, and the local community, for example, can exert considerable influ-
ence over change.
Identifying key stakeholders can start with the simple question, “Who stands to gain
or to lose from the changes?” Once stakeholders are identified, creating a map of their
influence may be useful.39 The map could show relationships among the stakeholders in
terms of who influences whom and what the stakes are for each party. This would pro-
vide change agents with information about which people and groups need to be influ-
enced to accept and support the changes.
8-4c Influencing Stakeholders
This activity involves gaining the support of key stakeholders to motivate a critical mass
for change. There are at least three major strategies for using power to influence others
in OD: playing it straight, using social networks, and going around the formal system.40
Figure 8.2 links these strategies to the individual sources of power discussed above.
The strategy of playing it straight is very consistent with an OD perspective, and thus
it is the most widely used power strategy in OD. It involves determining the needs of
particular stakeholders and presenting information about how the changes can benefit
them. This relatively straightforward approach is based on the premise that information
and knowledge can persuade people about the need and direction for change. The success
192 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
of this strategy relies heavily on the change agent’s knowledge base. He or she must have
the expertise and information to persuade stakeholders that the changes are a logical
way to meet their needs. For example, a change agent might present diagnostic data,
such as company reports on productivity and absenteeism or surveys of members’ percep-
tions of problems, to generate a felt need for change among specific stakeholders.
Other persuasive evidence might include educational material and expert testimony,
such as case studies and research reports, demonstrating how organizational changes can
address pertinent issues.
The second power strategy, using social networks, is more foreign to OD and
involves forming alliances and coalitions with other powerful individuals and groups,
dealing directly with key decision makers, and using formal and informal contacts to
gain information. In this strategy, change agents attempt to use their social relationships
to gain support for changes. As shown in Figure 8.2, they use the individual power base
of others’ support to gain the resources, commitment, and political momentum needed
to implement change. This social networking might include, for example, meeting with
other powerful groups and forming alliances to support specific changes. This would
likely involve ensuring that the interests of the different parties—labor and management,
for example—are considered in the change process. Many union and management coop-
erative efforts to improve performance and reduce costs involve forming such alliances.
This strategy also might include using informal contacts to discover key roadblocks to
change and to gain access to major decision makers who need to sanction the changes.
The power strategy of going around the formal system is probably least used in OD
and involves purposely circumventing organizational structures and procedures to get
the changes made. Existing organizational arrangements can be roadblocks to change,
and working around the barriers may be more expedient and effective than taking the
time and energy to remove them. As shown in Figure 8.2, this strategy relies on a strong
personality base of power. The change agent’s charisma, reputation, or professional cred-
ibility lend legitimacy to going around the system and can reduce the likelihood of nega-
tive reprisals. For example, managers with reputations as winners often can bend the
rules to implement organizational changes. Their judgment is trusted by those whose
support they need to enact the changes. This power strategy is relatively easy to abuse,
however, and OD practitioners should consider carefully the ethical issues and possible
unintended consequences of circumventing formal policies and practices.
Application 8.3 shows how Minnesota’s sexual violence prevention unit recruited
external and internal stakeholders into the strategic planning process. They used the
social networks of people with clear interests in the subject to support the planning and
implementation of change.
8-5 Managing the Transition
Implementing organization change involves moving from an existing organization state
to a desired future state. Such movement does not occur immediately but, as shown in
Figure 8.3, instead requires a transition period during which the organization learns how
to implement the conditions needed to reach the desired future. Beckhard and Harris
pointed out that the transition may be quite different from the present state of the orga-
nization and consequently may require special management structures and activities.41
They identified three major activities and structures to facilitate organizational transition:
activity planning, commitment planning, and change-management structures. A fourth
set of activities involves managing the learning process during change.
CHAPTER 8 MANAGING CHANGE 193
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DEVELOPING POLITICAL SUPPORT FOR THE STRATEGIC
PLANNING PROJECT IN THE SEXUAL VIOLENCE
PREVENTION UNIT
A
pplication 8.1 described the beginning of
the sexual violence prevention unit’s proj-
ect to develop a five-year plan for primary
prevention. The plan’s unique purpose was
to mobilize statewide efforts to prevent sexual
violence before it occurs. In this application, the
process that the committee used to identify and
manage the political stakeholders—both internal
and external—is described.
IDENTIFYING AND RECRUITING
STAKEHOLDER PARTICIPATION
The steering committee interviewed representa-
tives from various stakeholder groups, coalitions,
and state agencies. The results of the interviews
suggested (1) a need for broad involvement, espe-
cially from underrepresented groups, such as
communities of color, immigrant communities,
gay and lesbian groups, and youth and (2) a desire
among those involved to move from dialogue and
education toward taking collective action.
In response to these data, the OD consul-
tant proposed a two-day strategic planning
retreat for a large group of stakeholders. This
format was selected because of the strong
desire voiced in the interviews to get to action.
The steering committee confirmed that this
approach was preferable to stretching the plan-
ning over weeks of shorter meetings.
The unit administrator was essential in pull-
ing together the list of stakeholders who were
invited to participate. The goal was to get as
many stakeholders as possible involved, and
she knew the majority of people who were
active in sexual violence prevention work in
Minnesota. The steering committee reviewed
and augmented the initial list to create a diverse
group of 80 stakeholders to invite to the retreat.
This group included people from the many
groups, coalitions, state agencies, and under-
represented communities across the state.
Invitations to attend the retreat were sent
out via email. The OD consultants crafted the
invitation and the Health Unit Director sent
them out. The steering committee members
also contacted personally any invitees they
knew and encouraged them to attend. The
Health Unit Administrator was instrumental in
communicating with those invited. Follow-up
reminders and phone calls were made to
ensure that an RSVP was received from every-
one invited to attend. In addition, there were
regular communications on the progress of the
planning effort in newsletters, meetings, and
conferences, communication channels that
were already in place. An important constraint
to this process was the nature of the physical
facility that was to hold the meeting (see
below). The steering committee had to balance
the need for broad participation with the limits
of the meeting space. One tool they used was
to limit participation to the first 50 people who
signed up. This encouraged people to sign up
early to secure their space at the retreat.
Because primary sexual violence preven-
tion was a central concern to most of these
stakeholders, there was little resistance in
terms of interest in participating. Other hur-
dles, however, had to be addressed, including
the costs associated with attending the confer-
ence, travel issues, and the time to attend. The
health department was able to secure funding
to cover participants’ costs. However, the
steering committee had to work hard to find a
meeting site that was within commuting dis-
tance from many cities and able to provide
rooms for those traveling from afar. In the
end, a Catholic retreat center fit many of the
requirements of the conference, but presented
another set of challenges. For a few stake-
holder groups, there were negative percep-
tions about the perceived role of the church
in sexual violence; the location lacked air con-
ditioning; and there was no handicap access.
The planners of the project were also able
to build on several efforts that the health
department had previously used to gain stake-
holder involvement. For several years, the
194 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
department hosted a forum called the Sexual Vio-
lence Prevention Action Council. This group had
been engaged in education and dialogue on the
issue. Diverse stakeholders were already coming
together around the issues and had adopted a
framework developed by the Prevention Institute
called the “Spectrum of Prevention.” Without this
foundational work, it would have been risky to
attempt to get stakeholders aligned around a stra-
tegic plan in a two-day meeting.
Finally, another tool the steering committee
initiated for gaining involvement was an online sur-
vey. This survey was sent to all invitees so that
even those who could not attend the retreat
would have a voice in the planning. The survey
was also sent to others who were not invited to
the retreat. They were encouraged to pass the sur-
vey on to other stakeholders who might be inter-
ested in this plan. Close to 100 people responded
to the survey. A majority of respondents provided
contact information and volunteered to help with
the plan implementation.
CONDUCTING THE MEETING
Fifty invitees were able to attend the planning
retreat. Using a large-group OD process over two
days, participants worked together to create the
framework of a strategic plan. Part of the planned
agenda was to have stakeholders sign up for an
action team toward the end of the two days. The
dilemma faced during the session was in trying to
get both focused strategies and a very diverse group
of stakeholders to take action. Actions would need
to occur both at the state level and within individual
communities. Going into the meeting, the steering
committee was not sure that the team sign-up
process would work. They agreed to meet during
lunch on the second day to review the work and to
determine how to move the group toward action.
During the lunch meeting, the steering com-
mittee decided that the strategies were not clear
enough to create teams at the meeting. While the
group was concerned about losing people’s action
commitment, they believed it was more important
to have teams that made strategic sense and uti-
lized limited resources well. After lunch, the strate-
gies and success indicators were posted on the
wall. Consultants then used a multivoting process
to identify six priorities for action.
Following the retreat, the OD consultants
developed a proposed structure for action around
these six priorities and sent this to the steering
committee members for review. Their feedback
was incorporated into an action structure that
was included in the written strategic plan. Health
department staff members then took over the plan-
ning and launching of these teams.
SUSTAINING MOMENTUM
When the strategic planning project had begun, the
head of the sexual violence prevention unit had left
the organization, and the position had gone unfilled
throughout the project. Just prior to the retreat, a
well-known state leader in sexual violence work,
Patty Wetterling, agreed to fill the position. Seven-
teen years earlier, Wetterling’s young son had been
abducted in their small Minnesota town and was
never found. Her work in establishing new laws
regarding abductions as an advocate and state leg-
islator, as well as a run for the U.S. Senate, made
Wetterling a perfect choice to provide statewide
leadership in implementing the strategic plan.
FIGURE 8.3
Organization Change as a Transition
©
Ce
ng
ag
e
Le
ar
ni
ng
CHAPTER 8 MANAGING CHANGE 195
8-5a Activity Planning
Activity planning involves making a road map for change, citing specific activities and
events that must occur if the transition is to be successful. It should clearly identify, tem-
porally orient, and integrate discrete change tasks, and it should explicitly link these tasks
to the organization’s change goals and priorities. Activity planning also should gain top-
management approval, be cost-effective, and remain adaptable as feedback is received
during the change process.
An important feature of activity planning is that visions and desired future states
can be quite general when compared with the realities of implementing change. As a
result, it may be necessary to supplement them with midpoint goals as part of the activ-
ity plan.42 Such goals represent desirable organizational conditions between the current
state and the desired future state. For example, if the organization is implementing con-
tinuous improvement processes, an important midpoint goal can be the establishment of
a certain number of improvement teams focused on understanding and controlling key
work processes. Midpoint goals are clearer and more detailed than desired future states,
and thus they provide more concrete and manageable steps and benchmarks for change.
Activity plans can use midpoint goals to provide members with the direction and secu-
rity they need to work toward the desired future.
8-5b Commitment Planning
This activity involves identifying key people and groups whose commitment is needed
for change to occur and formulating a strategy for gaining their support. Although com-
mitment planning is generally a part of developing political support, discussed above,
specific plans for identifying key stakeholders and obtaining their commitment to change
need to be made early in the change process.
8-5c Change-Management Structures
Because organizational transitions tend to be ambiguous and to need direction, special struc-
tures for managing the change process need to be created. These management structures
should include people who have the power to mobilize resources to promote change, the
respect of the existing leadership and change advocates, and the interpersonal and political
skills to guide the change process. Alternative management structures include the following:43
• The chief executive or head person manages the change effort.
• A project manager temporarily is assigned to coordinate the transition.
• A steering committee of representatives from the major constituencies involved in
the change jointly manages the project.
• Natural leaders who have the confidence and trust of large numbers of affected
employees are selected to manage the transition.
• A cross section of people representing different organizational functions and levels
manages the change.
• A “kitchen cabinet” representing people whom the chief executive consults with and
confides in manages the change effort.
8-5d Learning Processes
Most organization changes involve the acquisition of new knowledge and skills that support
new behaviors. Research at the Center for Effective Organizations suggests that change can
196 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
be implemented more quickly when leaders consciously design learning processes into the
transition.44 Four practices, supported by a continuous dialogue and conversation process,
were associated with accelerated transitions. The first learning practice, creating a systems
view of the organization, involves creating a model of work and change that allows individ-
ual organizational members to see how their efforts contribute to organizational functioning
and performance. When people can see how their efforts support change, it is easier
for them to pick up new skills and knowledge; there is a context created that demands
new behaviors.
The second learning practice, creating shared meaning, describes the use of models,
language, tools, and processes that provide people with a way to making sense of the
change. Most organization change is accompanied by considerable anxiety as the organi-
zation begins moving from the known to the unknown. By creating common ways of
viewing the change, work, customers, and the new organization, people develop a shared
view of the new reality. This shared view lowers anxiety and allows organization mem-
bers to learn new skills and behaviors more quickly.
Engaging in “after-action reviews” or other processes that reflect on change experience
is the third learning practice. In this activity, initial attempts to try out new activities, new
processes, or new behaviors are assessed and reviewed. Organization members get to ask,
“how well did we do?” and “what can we learn from that?” The answers to these questions
are then used to redesign or redefine correct behavior. When people get timely and sup-
portive feedback on new behaviors, their ability to learn more quickly increases.
The final learning practice involves decentralizing implementation processes and deci-
sions to the lowest levels possible in the organization, what the researchers called “local
self-design.” Complex organization change contains too many variables, uncertainties, and
local contingencies to be completely programmed from the top of the organization. By
allowing organizational units in the lower organization levels to be responsible for the
implementation of change, the overall change is accelerated. It is important in this process
of local self-design to ensure that the organizational units have a clear understanding of
their boundaries. That is, senior leaders in the organization need to be clear about what
resources are available for change, the timeline within which the change must occur, and
the things that cannot be changed in achieving the change goals.
These four learning practices are held together by conversation and dialogue. More
than any other single practice, it is the opportunity to discuss the organization change—
to create shared meaning, to understand how each individual fits into the change, to
reflect on experience, and to discuss the change at local levels—that integrates the prac-
tices and accelerates implementation. Leading change, therefore, is largely a function of
creating opportunities for organization members to discuss change activities.
Application 8.4 shows how Hewlett-Packard and Compaq used all of these techniques
to manage the integration activities associated with this acquisition. Despite research indi-
cations of a high proportion of failed acquisition processes, the extraordinary detail used in
this process, and the bank of institutionalized knowledge (see Application 9.2), the HP–
Compaq integration process received positive reviews.45
8-6 Sustaining Momentum
Once organizational changes are under way, explicit attention must be directed to sus-
taining energy and commitment for implementing them. The initial excitement and
activity of changing often dissipate in the face of practical problems of trying to learn
CHAPTER 8 MANAGING CHANGE 197
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4
TRANSITION MANAGEMENT IN THE HP–COMPAQ
ACQUISITION
I
n the Fall of 2001, Carly Fiorina announced
HP’s intent to acquire Compaq Corporation.
Over the next nine months, a proxy fight
ensued as many shareholders and employ-
ees challenged the wisdom of the proposed
change. Wall Street analysts and organization
researchers too debated whether or not the
acquisition made sense, especially given the
size of the change and the rather dismal history
of performance in acquisition cases. Scott
McNealy, chief executive of rival Sun Micro-
systems Inc., predicted “a slow-motion
collision of two garbage trucks.”
Within days of the initial announcement,
however, Fiorina and Michael Capellas, then
CEO of Compaq, met with Webb McKinney, a
19-year HP veteran, and Jeff Clarke, Compaq’s
CFO and survivor of Compaq’s acquisition of
Digital Equipment Corporation. These two
men were named to lead the transition pro-
cess, one that would involve redeploying a
combined 145,000 workers in 160 countries
including more than 15,000 layoffs, untangling
163 overlapping product lines, and producing
$2.5 billion dollars in promised cost reductions.
It was no accident that McKinney and Clarke
were asked to lead the integration team. Both
were senior managers with substantial follow-
ings and excellent reputations. Days after their
initial meeting, they began recruiting managers
in equal numbers; Clarke rounded up Compaq
talent and McKinney lined up their HP matches.
Within weeks of the merger’s announcement,
the integration group, called the “clean team,”
had 500 members; by March 2002, more than
900. Even after the merger closed in May 2002,
it kept growing, peaking at more than 1,000 full-
time employees. By establishing such a huge
body of outstanding managers and reassuring
them that their jobs would be safe even if the
merger failed, Clarke and McKinney were able to
coax them to share in confidence everything
they knew. It also kept most of them motivated
to stay—another critical benchmark.
In addition to getting the right people on
board, McKinney and Clarke set up an assembly
line for decision making. Their research on suc-
cessful and unsuccessful acquisitions and
Clarke’s experience with the Digital acquisition
convinced them that slow decision making and
the lack of a clear decision-making process was
like a cancer in the transition process. In
response, they created the “adopt and go”
strategy: Get cross-company pairs of managers
to meet daily to determine the best choice or
best course of action on any particular issue.
Weekly meetings kept the pace fast. If any
issues couldn’t be resolved by the teams,
McKinney and Clarke would jump in. If those
two couldn’t resolve the impasse, they’d pass
it to a committee chaired by Fiorina.
In addition to getting the right people on
board and setting up a decision process built
for speed, the transition team created activity
plans for the key issues facing the integration,
including people, products, culture, Day-one
activities, and day-to-day operations. Excerpts
and examples from some of those plans are
reviewed below.
• The “adopt and go” process was used to
decide which products to keep and which to
discontinue. At weekly presentations with
McKinney and Clarke, managers had to
offer up one for elimination. In contrast to
Compaq’s merger with Digital, HP execu-
tives made quick product decisions and
every week pored over progress charts
with red, green, and yellow markers to
review how each product exit was proceed-
ing. Red and yellow markers indicated a
task was troubled; green signaled a task
going well. In four months, a road map for
product lines emerged and helped to close
redundant warehouses and factories, ulti-
mately saving $500 million in procurement
costs. In the end, while many Compaq pro-
ducts beat out HP’s, such as Compaq’s iPac
over HP’s Jornada, the HP brand survived.
• The “adopt and go” process also helped
HP make the hard decisions about person-
nel appointments. HP appointed its top
198 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
new ways of operating. A strong tendency exists among organization members to return
to old behaviors and well-known processes unless they receive sustained support and
reinforcement for carrying the changes through to completion. In this section, we pres-
ent approaches for sustaining momentum for change. The subsequent tasks of assessing
and stabilizing changes are discussed in Chapter 9. The following five activities can help
three tiers of executives before the acquisition
was finalized and made new levels of appoint-
ments every few weeks. While not perfect—
rumors that Compaq people were favored in
the sales organization—Clarke contends that
all decisions were made “by the book.”
• HP created a team to deal specifically with
melding the corporate cultures and hired consul-
tants to document the differences. To address
perceptions that Compaq employees were
“shoot from the hip cowboys” and that HP
staff members were “bureaucrats,” the team
created a series of cultural workshops. They
were designed to identify the various cultures
and subcultures, and then integrate them. For
example, key sales managers and about two
dozen salespeople from both HP and Compaq
held a workshop designed to address sales inte-
gration and transition issues. Many attendees
first looked at each other suspiciously. Following
some ice-breaker exercises, however, an HP
representative talked about how HP had been
working with key customer SBC, the telecom-
munications company. That was followed by a
Compaq rep discussing how it sold to SBC.
Then the big group drew up a 100-day work
plan for selling to SBC in the future, including
a weekly conference call for the team every
Friday. The progress from these sessions was
tracked by a team of 650 part-time internal “cul-
tural consultants,” who also continued in their
normal jobs at the company.
• The cultural workshops delivered in the first
quarter after the deal was signed set the
stage for further cultural integration. The work-
shops welcomed everyone to the new team,
described the HP business, HP’s values and
operating models, the roles and objectives
of different groups, and how people were
expected to work together. All of this material
was pushed out into the HP market before the
launch, inviting a few thousand of the top HP
managers to an orientation and education ses-
sion on what to do, how to communicate, and
the details of the new HP and their roles in it.
• The clean team also made extensive “Day-one”
plans. Day-one readiness included plans to
address customers, issues of leadership and
structure, and internal administrative issues.
The new HP was launched with everyone on
the same email, not a paycheck missed, and
every sign changed the morning of launch day.
Customers participated heavily in the transition
process. Customer councils, interviews,
research, information sessions, education, and
other data were included in the knowledge trans-
fer to groups that faced the customer. The go-
to-market plans were detailed, with playbooks
given to each group manager who touched the
customers, so that on launch day they knew
what to do, what to say to a customer, where
to get information. Each customer was given an
HP buddy from the same level so that he or she
could contact that person and get whatever infor-
mation the customer needed. There was an
enormous amount of detail, down to the script
of what to say, what answers to give to specific
questions, where to get further information, and
how to transition an inquiry to the right person.
By most measures, this transition work paid
off: HP met the integration goals that Chairman
and Chief Executive Carleton S. Fiorina set for the
merged company. The biggest of these was cost
savings, which surpassed expectations. By mid-
2003, HP said it saved $734 million—14% more
than projected—from payroll cuts and better terms
with its suppliers.
CHAPTER 8 MANAGING CHANGE 199
to sustain momentum for carrying change through to completion: providing resources
for change, building a support system for change agents, developing new competencies
and skills, reinforcing new behaviors, and staying the course.
8-6a Providing Resources for Change
Implementing organization change generally requires additional financial and human
resources, particularly if the organization continues day-to-day operations while try-
ing to change itself. These extra resources are needed for such change activities as
training, consultation, data collection and feedback, and special meetings. Extra
resources also are helpful to provide a buffer as performance may drop during the
transition period. Organizations can underestimate seriously the need for special
resources devoted to the change process. Significant organizational change invariably
requires considerable management time and energy, as well as the help of OD consul-
tants. A separate “change budget” that exists along with capital and operating budgets
can earmark the resources needed for training members in how to behave differently
and for assessing progress and making necessary modifications in the change pro-
gram.46 Unless these extra resources are planned for and provided, meaningful change
is less likely to occur.
8-6b Building a Support System for Change Agents
Organization change can be difficult and filled with tension not only for participants
but also for change agents as well.47 They often must give members emotional support,
but they may receive little support themselves. They often must maintain “psychologi-
cal distance” from others to gain the perspective needed to lead the change process.
This separation can produce considerable tension and isolation, and change agents
may need to create their own support system to help them cope with such problems.
A support system typically consists of a network of people with whom the change
agent has close personal relationships—people who can give emotional support, serve
as a sounding board for ideas and problems, and challenge untested assumptions. For
example, OD professionals often use trusted colleagues as “shadow consultants” to help
them think through difficult issues with clients and to offer conceptual and emotional
support. Similarly, a growing number of companies, such as Procter & Gamble, The
Hartford, and Kaiser Permanente, are forming internal networks of change agents to
provide mutual learning and support.
8-6c Developing New Competencies and Skills
Organizational changes frequently demand new knowledge, skills, and behaviors from
organization members. In many cases, the changes cannot be implemented unless mem-
bers gain new competencies. For example, employee involvement programs often require
managers to learn new leadership styles and new approaches to problem solving. Change
agents must ensure that such learning occurs. They need to provide multiple learning
opportunities, such as traditional training programs, on-the-job counseling and coaching,
and experiential simulations, covering both technical and social skills. Because it is easy
to overlook the social component, change agents may need to devote special time and
resources to helping members gain the social skills required to implement changes.
200 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
As part of McKesson’s commitment to quality, the corporation identified specially
selected high performers to become Six Sigma black belts and then promoted them
accordingly to signal the importance of these skills and knowledge in career planning.
In addition, senior managers in all of the divisions are required to attend training that
builds new problem-solving skills, team behaviors, and a commitment to the quality
philosophy.48
8-6d Reinforcing New Behaviors
In organizations, people generally do those things that bring them rewards. Consequently,
one of the most effective ways to sustain momentum for change is to reinforce the kinds of
behaviors needed to implement the changes. This can be accomplished by linking formal
rewards directly to the desired behaviors. For example, Integra Financial encouraged more
teamwork by designing a rewards and recognition program in which the best team players
got both financial rewards and management attention, and a variety of behaviors aimed at
promoting self-interest were directly discouraged.49 (Chapter 15 discusses several reward-
system interventions.) In addition, desired behaviors can be reinforced more frequently
through informal recognition, encouragement, and praise. Perhaps equally important are
the intrinsic rewards that people can experience through early success in the change effort.
Achieving identifiable early successes can make participants feel good about themselves
and their behaviors, and thus reinforce the drive to change.
8-6e Staying the Course
Change requires time, and many of the expected financial and organizational benefits
from change lag behind its implementation. If the organization changes again too
quickly or abandons the change before it is fully implemented, the desired results may
never materialize. There are two primary reasons that managers do not keep a steady
focus on change implementation. First, many managers fail to anticipate the decline in
performance, productivity, or satisfaction as change is implemented. Organization mem-
bers need time to practice, develop, and learn new behaviors; they do not abandon old
ways of doing things and adopt a new set of behaviors overnight. Moreover, change
activities, such as training, extra meetings, and consulting assistance, are extra expenses
added onto current operating expenditures. There should be little surprise, therefore, that
effectiveness declines before it gets better. However, perfectly good change projects often
are abandoned when questions are raised about short-term performance declines.
Patience and trust in the diagnosis and intervention design are necessary.
Second, many managers do not keep focused on a change because they want to
implement the next big idea that comes along. When organizations change before they
have to, in response to the latest management fad, a “flavor-of-the-month” cynicism can
develop. As a result, organization members provide only token support to a change
under the (accurate) notion that the current change won’t last. Successful organizational
change requires persistent leadership that does not waver unnecessarily.
Application 8.5 describes the implementation of an engagement and innovation pro-
cess at the RMIT University Library in Australia. After initial interventions were made, a
midterm review suggested additional changes that were designed to sustain the change
process’s momentum.50
CHAPTER 8 MANAGING CHANGE 201
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5
SUSTAINING CHANGE AT RMIT UNIVERSITY LIBRARY
IN MELBOURNE, AUSTRALIA
R
MIT University is a large tertiary educa-
tional institution located in Melbourne
Australia. The university has more than
75,000 students, including approximately
16,000 students attending an off-shore campus
or studying with partner institutions. Australian
education is undergoing rapid change in
response to various government initiatives, the
change to a “demand-driven” system, and a
general tightening of funding. These pressures
have resulted in the need for more innovation in
the education process and increased leadership
capacity to support these changes.
In addition to the changes in the broader
education environment, the large amount of
technological change in the information industry
provided the library management and staff an
important context and encouragement to inno-
vate and change. The most direct and obvious
indicator of the changing role of the library
was the steady drop in its traditional form of
service—loaning out books. Despite a 33%
increase in students between 2000 and 2010,
the number of book loans per student declined
from 10.8 to 5.7. Other indicators of library use
also changed, including a shift from long, in-
depth reference questions from faculty and stu-
dents to shorter and more specific inquiries.
Engaged staff and confident leaders were
needed to adapt to changed patterns of use, to
meet changing user expectations, and to envis-
age and implement new approaches to service.
However, input from a broad leadership group
formed inside the library and an organization-
wide climate survey, which provided results at
unit level, indicated that library staff engage-
ment levels were below desirable levels.
Over the last five years, the RMIT University
Library has adopted strategies that were designed
to increase and sustain employee engagement
and levels of innovation. The library’s initial
approach involved four interventions: leadership
development, specific purpose working groups,
cross unit work experiences, and increased
involvement in professional associations.
LEADERSHIP DEVELOPMENT
As part of a broader University-level leader-
ship development program—leadRMIT—the
RMIT University Library worked to strengthen
its leadership capacity. Since 2008, the library
has recognized 18 to 20 staff as a “leader-
ship” group. The group identified the positive
and negative elements of the library’s existing
culture. Desirable changes to the culture were
then identified and a variety of leadership
development activities were provided to
equip managers to support the agreed direc-
tion. This included participating in the lead-
RMIT courses which involved several full-day
sessions with expert external facilitators over
a few months. In addition, survey instruments
that identified the leadership skills and
emotional competencies of the managers
provided insights into the approaches and
leadership styles that supported staff engage-
ment. The library arranged sessions to
address specific people management skill
needs. After the initial batch of training, a
round table was formed as an ongoing oppor-
tunity to share insights gained from profes-
sional reading, conferences, and other
sources, and to discuss leadership and man-
agement issues.
THE CUE PROGRAM
As in any large library, there was a tendency
towards a culture of specialization in the work-
place. Staff in the loans area, for example, had
little knowledge or experience in the technical
service areas, and those in technical service
areas tended not to have experience working
with library users. To overcome this “silo effect”
and build a more flexible workforce, cross unit
work experience opportunities (called “CUEs”)
were instituted in 2008. Under this system, man-
agers were invited to create training opportu-
nities that were then placed on an internal
register. A CUE was initiated by a librarian
expressing interest in an opportunity that was
202 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
mediated by the staff development librarian. Four cat-
egories of CUEs were defined, including:
1. Short, half-day opportunities over a three-day
period were primarily aimed at staff in their
first two years of employment to enhance
cross unit cooperation.
2. A shadowing assignment provided a short-
term opportunity to gain insight into another’s
work, often where actually doing the work was
not feasible.
3. Longer one-day/week for six months opportu-
nities promoted multiskilling and workforce
flexibility.
4. Full-time immersion experiences over four to eight
weeks provided an opportunity to deepen and
enhance multiskilling and workforce flexibility.
SPECIFIC PURPOSE WORKING GROUPS
A variety of specific working groups were created to
encourage more open and innovative approaches to
the changing environment. For example, the New
Professionals Group was created with the intention
of entrenching a positive organizational culture and
developing organizational savvy and capability. It
was hoped that the formation of this group would
support the less-experienced professionals to act as
change agents. Similarly, the Innovative Librarians
or “Innovatives” group focused on exploring new
technologies, communicating these to staff, and
making recommendations as to how these might
be used. One of the challenges in terms of the
impact of this group was that the members were
in relatively low-influence positions in terms of tradi-
tional hierarchy and they often lacked strong advo-
cacy skills and confidence.
INVOLVEMENT IN PROFESSIONAL
ASSOCIATIONS
To maximize innovative activity requires buy-in
which extends beyond leaders and select indivi-
duals. As a result, the university librarian promoted
involvement in professional associations and led by
example. Library staff were encouraged and sup-
ported to participate in professional activities,
including attending and presenting at meetings
and conferences, writing news items and articles,
and undertaking study tours.
Although every intervention ideally should
receive a separate and formal assessment, sev-
eral indicators were used to sense implementa-
tion success and suggest follow-on activities. For
example, a management skills audit undertaken in
late 2010 and early 2011 affirmed significant prog-
ress in the overall confidence levels of managers
regarding their people management skills. Anec-
dotal evidence, evaluation forms provided by par-
ticipants in the CUE program, and the ongoing
commitment of managers to create and support
the scheme indicated that the experience was
valuable for the staff member and productive
from the manager’s perspective. Finally, the
impact of participation in cross unit projects and
the specific purpose groups had clearly had posi-
tive impact on participants.
To sustain the staff’s engagement and to
encourage additional innovation at the library, a
simple innovation process was created and was
supported by an individual and team development
program.
A MODEL OF INNOVATION
The RMIT University Library innovation process
was modeled after popular processes developed
by IDEO as well as library specific processes
located through benchmarking efforts. In itself the
model was far from novel, but its simple “gener-
ate, develop and deploy” labels provided a com-
mon language for units and staff across the
library and served as a basis for skill development
in support of innovation.
For example, a short-term specific-purpose
working group was formed to select and describe
idea generation techniques considered appropriate
to the RMIT University Library. This group also devel-
oped approaches for strengthening ideas. They
wanted to avoid “idea assassination” where ideas
were recommended without adequate thought and
to ensure that good ideas were as well presented as
possible before formal approvals were sought. This
necessitated clarifying criteria used to decide
whether or not to accept and implement sugges-
tions, and reaching agreement on a template for
making suggestions and providing feedback. To
ensure this work was not isolated from reality, tech-
niques were piloted on current library projects.
CHAPTER 8 MANAGING CHANGE 203
SUMMARY
In this chapter, we described five kinds of activities that
change agents must carry out when planning and
implementing changes. The first activity is motivating
change, which involves creating a readiness for change
among organization members and overcoming their
resistance. The second activity concerns creating a
vision that builds on an organization’s core ideology.
It describes an envisioned future that includes a bold
and valued outcome and a vividly described desired
future state. The core ideology and envisioned future
articulate a compelling reason for implementing
change. The third task for change agents is developing
political support for the changes. Change agents first
must assess their own sources of power, then identify
key stakeholders whose support is needed for change
and devise strategies for gaining their support. The
fourth activity concerns managing the transition of
the organization from its current state to the desired
future state. This requires planning a road map for
the change activities, as well as planning how to gain
commitment for the changes. It also may involve cre-
ating special change-management structures and a set
of learning processes that accelerate the transition. The
fifth change task is sustaining momentum for the
changes so that they are carried to completion. This
includes providing resources for the change program,
creating a support system for change agents, develop-
ing new competencies and skills, reinforcing the new
behaviors required to implement the changes, and stay-
ing the course.
INDIVIDUAL AND TEAM DEVELOPMENT
To support broader individual and team skill
development, the library adopted a team man-
agement profile process. Staff members com-
pleted an online survey and then participated in
workshops to understand the sources of team
effectiveness, to gain insights into and apprecia-
tion of diverse approaches to work, to assess
team strengths weaknesses and priorities, and
to take steps to enhance effectiveness. While
the workshops did not place a major focus on
the link between team effectiveness and inno-
vation, the team management profiles and
workshop experiences laid an important founda-
tion for improving innovation levels by identify-
ing individual work preferences, affirming the
value of each person’s unique contribution,
increasing understanding between individuals
which may increase levels of trust, and opening
up conversations on new ways of thinking
about work.
The RMIT University Library used initial
interventions and an informal midterm
assessment to track the progress of the
change and then crafted additional interven-
tions to sustain the change. The initial inter-
ventions of leadership development to
enhance the knowledge, motivation, and
skills of managers to engage staff; cross
unit work experiences to build a more flexible
workforce; specific purpose working groups
to address particular issues; and the promo-
tion of involvement in professional associa-
tions helped start the change. Subsequently,
adoption of a common innovation process
model and the provision of practical team
effectiveness techniques helped to sustain
innovation and engagement in the organiza-
tion. A repeat organizational climate survey
in the future will help to determine whether
the engagement levels have risen among
library staff.
204 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
7
Week 3 Management
Student’s Name
University Name
Course
Professor’s Name
Date
Week 3 Management
Part 1-
CH.7 Designing Interventions
1. Describe the interventions presented in the text.
There are four major interventions presented in the case. First is the human process intervention that includes people and processes within the organization used to accomplish goals. Secondly is the techno-structural interventions, which focus on technology and structures to promote effectiveness. Thirdly is human resource management intervention used to motivate employees in the organization. Lastly, strategic change intervention brings together internal and external factors to manage the changing conditions (p. 1).
2. Discuss how contingencies related to the change situation affect the design of effective organization development (OD) interventions.
The design of organization intervention is affected by differences among the organization employees, how change is implemented, and organizational factors like styles used to manage the organization (p. 7). If these factors are not considered, results for designing intervention will be negative.
3. Discuss how contingencies related to the change target affect the design of effective OD interventions.
Contingencies related to the target affect the organization’s intervention as changing parts of the organization based on the issue to be addressed and organization system levels used to resolve issues (p. 8).
CH.8 Managing Change
1. Understand the five key elements of successful change management.
The five key elements for successful change management are as follows; as shown on page 2;
I. Motivating change – making the organization ready to take in the change without much resistance.
II. Creating a vision – having the envisioned feature concerning change.
III. Development of political support – identifying the key stakeholders, influencing them on the change, and identifying the agents having power over change.
IV. Managing transition – this element involves planning and managing the changing structure.
V. Sustaining momentum – the organization has to provide a support system for change, build skills and competence for the change, and provide required resources.
2. Explore the processes of change associated with each element.
Each of these elements has to undergo the process of change for the current state, transition state, and the desired outcome for the change to have been fully implemented. Here, the current process is linked with the future, where objectives are set to attain future goals.
CH.9 Evaluating and Institutionalizing Organization Development Interventions
1. Illustrate the research design and measurement issues associated with evaluating organization development (OD) interventions.
The key issues associated with evaluating OD interventions include implementation and the evaluation of the feedback (p. 2). Feedback varies from individuals, and they are also evaluated in different ways, making it challenging to be implemented as desired. The second issue is a measure that involves two categories of challenges; selecting variables that are appropriate and having a good design for measuring them. Lastly is the research design, which has the assessment issues.
2. Explain the key elements in the process of institutionalizing OD interventions.
Institutionalization involves the process of changing the OD interventions. They include;
I. Institutionalization framework – identified the degree to which change will affect the organization (p. 16).
II. Organization characteristics – gives the three dimensions that affect change intervention (p. 16).
III. Intervention characteristics – gives the five features of OD and how they impact the institutionalization process (p. 17).
IV. The institutionalization process is used to show how institutionalization process affects OD interventions (p. 18).
V. Indicators for institutionalization – the degree of how change has persisted in the organization (p. 22).
Homework part 2
Discuss the activities necessary for Sustaining Momentum when Managing change
To sustain momentum when managing change, the following are five major activities that should be carried out;
I. Provision of change resources – financial and human resources are required for the organization to continue with the change process (pg. 22).
II. Ensuring there is a change support system – the support system ensures members have the required emotional and physical support for a positive change process (pg. 22).
III. Developing skills and competencies for the change – change demands for new skills and competencies for it to be articulated with effectiveness (pg. 22).
IV. Emphasizing new behaviors – behaviors for change implementation have to be reinforced for people to continue with the behavior towards change (pg. 23).
V. Staying on the line of change – for change to be maintained, change has to be fully implemented, and actions for change to continue being articulated (pg. 23).
These elements enable the organization to maintain the change moment that to the successful implementation of change.
Homework part 3
List and briefly describe each of the techniques used to reinforce change in this organization.
The techniques for reinforcing change are as follows;
I. Motivating change – it includes the activities of making the organization be ready to accept and articulate changes. A good environment for accepting change has to be created to make employees be committed both physically and psychologically towards the change process (p. 3). As a result, why and what questions are well answered, which helps in reinforcing change.
II. Motivating change – since many people and organizations resist change, motivating employees with benefits like rewards, bonuses, coupons, and increased salaries helps to put and reinforce change (p. 3).
III. Overcoming resistance – since change is accompanied by a lot of resistance from people in the organization, overcoming resistance helps in reinforcing change (p. 5). It helps in dealing away with uncertainty concerning change, thus achieving the benefits for change implementation.
IV. Creating a vision – visions helps in guiding the employees as it clarifies to them what needs to be accomplished as it gives an emotional connection to the change (p. 6). Describing the desired future and the end results provides a footpath towards success. The management has to carry out this practice as it reminds the employees every day what is supposed to be done thus, reinforcing change.
V. Having political support towards change – employees feel safe when the government supports them towards a certain change to be articulated. Political power is positively used to gain access and have a base for influencing decision-makers and the employees to articulate the desired change (p. 10).
By following the above techniques, organizations can effectively manage change and reinforce it to the organization until it has been fully adopted.
References
Chapter 7
Chapter 8
Chapter 9
