Chapter Fifteen Organization Change and Development.

Chapter Fifteen

Organization Change and Development

Copyright © Houghton Mifflin Company. All rights reserved. 15-2

Chapter Objectives

• Summarize four dominant forces for change in organizations.

• Describe the process of planned organization change as a continuous process.

• Discuss several approaches to organization development.

• Explain organizational and individual sources of resistance to change.

• Identify six keys to managing successful organizational change and development


Forces for Change

• An organization faces pressures for change from numerous sources:– It is difficult to predict what types of pressures for

change will be the most significant in the next decade because the complexity of events and the rapidity of change are increasing.

– Four categories of pressures that are likely to have major effects on organizations include:

• People, technology, information processing and communications, and competition.


Pressures for Organizational Change

• People– Baby Boomers comprise approximately 56 million

people born between 1945 & 1960. Special characteristics of this group include distinct purchasing patterns that affect product and service innovation, technological change, and marketing activities.

• Technology– Technology development is increasing so rapidly

in almost every field making it difficult to predict which products will dominate 10 years from now.


Pressures for Organizational Change (continued)

• Information Processing and Communications– In the future, people may not need offices as they

work with computers and communicate through new data transmission devices.

• Competition– Most markets are international because of

decreasing transportation and communication costs. The Internet is creating new opportunities overnight.


Table 15.1Pressures for Organizational Change


Planned Organizational Change

• External forces may impose change on an organization.

• Ideally, the organization will not only respond to change but will anticipate it, prepare for it through planning, and incorporate it in the organization strategy.


Lewin’s Process Model

• Kurt Lewin suggested that efforts to bring about planned change in organizations should approach change as a multistage process.

• His model of planned change consists of 3 steps– Unfreezing– Change– Refreezing


Figure 15.1: Lewin’s Process Model of Organizational Change


The Continuous Change Process Model

• Lewin’s model is very simple and straightforward, so virtually all models of organizational change use his approach.

• However, it does not deal with several important issues.

• This approach treats planned change from the perspective of top management and indicates that change is continuous.


The Continuous Change Process Model (continued)

• Major Steps in the Model– Top management perceives that change is needed.– The issue in question is subjected to the

organization’s usual problem-solving and decision-making processes.

– Alternatives for change are generated and evaluated, and an acceptable one is selected.

– The change agent and top management assess the degree to which the change is having the desired effect, and make adjustments if necessary.


Figure 15.2: Continuous Change Process Model of Organizational Change


Organization Development

• The process of planned change and improvement of an organization through the application of knowledge of the behavioral sciences. – First, organization development involves attempts to plan

organization changes, which excludes spontaneous, haphazard initiatives.

– Second, the specific intention of organizational development is to improve the organization.

– Third, the panned improvement must be based on knowledge of behavior sciences such as organizational behavior, psychology, sociology, and related fields rather than financial or technological considerations.


Systemwide Organization Development

• Structural Change– A major reorientation or reorganization that

affects performance appraisal and rewards, decision making, and communication and information processing systems.

– No systemwide structural change is simple.


Systemwide Organizational Development (continued)

• Contemporary Approaches to Systemwide Structural Change involve:– Reengineering– Changing the way tasks are divided into jobs– Combining jobs into departments and divisions– Rearranging authority and reporting relationships – Dividing large groups into smaller ones– Moving from functional departmentalization to a

system based on products or geography– Moving from a vertical or functional design to a

matrix or a team-based design


Task and Technological Organizational Development

• Task Redesign– Changing tasks involved in doing the work– Changing how inputs are transformed into

outputs is called technological change usually results in task changes


Four Types of People-Oriented Change Techniques

• Training– Generally designed to improve employees’ job

skills. Among the many training methods, the most common are lectures, discussions, lecture-discussion combinations, experiential methods, case studies, and films or videotapes.

• Management Development Programs– Programs that attempt to foster certain skills,

abilities, and perspectives. Training in this area typically relies heavily on participative methods such as case studies and role playing.


Four Types of People-Oriented Change Techniques (continued)

• Team Building– Emphasizes members working together in

a spirit of cooperation

• Survey Feedback– Techniques used to form the basis for a

change process; data are gathered, analyzed, summarized, and returned to those who generated them to identify, discuss, and solve problems


Figure 15.3: The Survey Feedback Process


Resistance to Change

• Resistance to change can come from the organization, the individual, or both.

• Organizations both promote and resist change.– As an agent of change, the organization asks

prospective customers to change their purchasing habits by buying its products or services, and asks clients and suppliers to change to accommodate other firm objectives.

– An organization resists change in that its structure and control systems protect the daily tasks of producing a product or service from uncertainties in the environment.


Table 15.3: Organizational and Individual Sources of Resistance


Table 15.3: Organizational and Individual Sources of Resistance (continued)


Table 15.4: Managing Successful Organizational Change

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Chapter Fifteen Organization Change and Development.

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