 chapter-1

unit-2
Organisational renewal and challenge of change:

 Chapter plan

 Introduction

 Challenges of Change

 Organization renewal

 System approach to adopted change

 Socio technical system

 Future aspect and change

 Organization transformation and development

 OD planned change process.

 Introduction:

 The organization renewal requires that top managers make adaptive changes to the
environment .

 Organization exist in a changing environment and therefore must have the capacity to adapt
change.

 Challenges of Change

 Change is the name of the game in management today. Market, product and competitive
conditions are rapidly changing.

 Under these pressures, organizations are changing.

 They are downsizing, reengineering structures ,going global and initiating more sophisticated
technologies.

 Organization renewal requires that top managers make adaptive changes to the environment.
by using system approach.

 System approach provides a way of observing, analyzing and solving problems in organizations.

 Renewal

 Because of the rapid speed of technology ,firm are confronted with the early technological
obsolescence of products.
  In the past, companies could grow during the long lifespan of a proprietary invention, but today
their innovations are often quickly overtaken by competitors with technological improvements.

 Organizations either become more adaptive, flexible and anticipative or they become rigid and
stagnant, reacting to change after the fact, often when it is too late seldom can managerial
decisions be based exclusively on extrapolations of historical experience.

 Many decisions are unique, innovative and risky, involving new areas of opportunity.

 Organization renewal

 Make adaptive changes to environment.

 The only constant is change.:Increasing rate of change.Impact of future shock. Organizations

need capacity to adapt to changing environment.

 Focus on changing systems and system-wide impact. :The focus of

organization development is on changing organizational systems, stressing the
situational nature of problems and their system-wide impact.

 Changing the condition

 Change Management

Coin Sorter

 Digital interface!

 As seen on TV!

 Auto-sorts coins!

 Ready to roll!

 Organization Renewal -
Adapting to Change

 Organizational renewal important to survival.

 OD practitioner, then is ultimately interested in changing human behaviour and organizational

processes to create a more adaptive and flexible organization.

 organizational renewal is important .if a company is to survive in an increasingly competitive

marketplace, the organization must continuously adapt to its environment: without renewal,
management cannot maintain excellence.

 Defined as ongoing process of building innovation and adaptation.

  Key Factors in Renewal
(given by Robert Waterman)

 Informed opportunism.

 Direction and empowerment.

 Friendly facts.

 A different mirror.

 Teamwork and trust.

 Stability in motion.

 Attitudes and attention.

 Causes and commitment.

 Table 2.1
Lessons in Corporate Renewal (part 1 of 2)

 Table 2.1
Lessons in Corporate Renewal (part 2 of 2)

 Approaches to Change

 Every organization must have enough stability to continue to function satisfactorily and still
prevent itself from becoming too static or stagnant to adapt to changing conditions.

Two dimensions:

 Adaptive orientation.: Devid Miller argues that some organizations resist change untill a critical
state of incongruence is reached, at which point a “quantum” change occurs.

 Environmental stability.

 Figure 2.1
Model of Adaptive Orientation

 1]Sluggish- Thermostat Management:

 Stable Environment low adaptation.

 This term is originated by David Miller.

 Sluggish management refers to a managerial style based on low risk, with formalized procedures
and a high degree of structure and control.
 Inability to meet new customer demands.

 2]Satisfying Management

 Stable environment, high adaptation.

 Management is Adequate and average.

 It is a style of managing that emphasizes a more centralized decision-making structure with

problems referred to the top. Planning and decision-making concentrated at top.

 3]Reactive Management

 Reactive management - waiting until something becomes a problem before reacting.

 Dynamic environment, low adaptation.

 Reacting after conditions change.

 Short-term, crisis type of adaptation.

 Replacement of key people and rapid reorganization.

 4]Renewing/Transformation Management

 Organizations that exist in a hyper turbulent environment must not only respond to change,
they must proactively take advantage of new opportunity and innovation.

 Dynamic environment, high adaptation.

 Deal with future conditions before conditions occur.

 Faster developing new ideas and more participative.

 Systems Approach

 System - set of interrelated elements joined to achieve a goal or purpose.

 Horizontal corporation breaks company into key processes. demolition hierarchical

organizational charts; reduction in layers of management.

 Creates teams from different departments to run them.

 This suggests that managers can no longer function within the traditional organizational chart,
but must integrate their department with the goals and strategy of the whole organization.

 Organization as a System

 System is set of interrelated parts.

  Unified by design to achieve purpose or goal.

 Organizations are system. Every organization can be viewed as a number of interrelated,

interdependent parts, each of which contributes to total organizational functioning and to the
achievement of the overall organization goal.

 A system is “an organized unitary whole composed of two or more interdependent parts,
components, or subsystems and delineated by certain boundaries from its environment ”

 Basic Qualities of Systems

 Designed to accomplish objectives.

 Established arrangement.

 Interrelationships exist among elements.

 Process more vital than basic elements.

 Organization more important than elements.

 System consists of inputs, processes, outputs.

 Figure 2.2
Organization as Open System

 Open Systems

 In continual interaction with environment.

 Continually receives feedback from environment.

 Open system - interrelated and acts with its environment

 Dynamic equilibrium - steady state, reacting with environment

 Closed systems - self-contained and isolated from environment.

 The Sociotechnical System

 Sociotechnical System - open system of coordinated human and technical activities with five
major subsystems.

Coordinated human and technical activities.

Consists of:

 Goals and values.

  Technical subsystem.

 Structural subsystem.

 Psychosocial subsystem (culture).

 Managerial subsystem.

 Figure 2.3
The Sociotechnical System

 High Performance Systems

Occur by design—not by chance.

 “all organizations are perfectly designed to get the results they get”

Key variables are: if manager wish to improve performance and to identify the real drivers of
organizational success used in organization development and renewal programs to improve system
performance.

• High Performance Work Systems Framework

 Contingency Approach

 Contingency theory recognizes that there are difference between organizations.

 Contingency approach - attempt to determine proper management technique to employ.

 Considers organization and environment.

 Identifies “if-then” relationships and Suggests change directions.

 This view suggests that managers in different department units face situation that may be very
different on a number of dimensions, including degree of structure, level of motivation and
potential for conflict.

 Future Shock and Change

 inability to cope with rapid change.

 Too much change in too short a time.

 Inability to adapt to accelerating rates of change.

 Management reaction to change worried.

 Managers must be adaptable and flexible.

  Technological advances are occurring so rapidly that the education of most scietists is
technically obsolete within a few years after graduation from college.

 Organization Transformation (OT) Like a Revolution

 Changing organization’s form or appearance.

 OT a revolution.

 Transforms framework of organization.

 Unplanned changes in response to pressures.

 OD - The Planned Change Process

 OD like an evolution.

 Planned changes on large scale.

 Longer time frame.

 Gradual implementation.

 Modifies total organization or major parts.

 OD Focuses On:

 Individual effectiveness.

 Team effectiveness.

 Organization effectiveness.

• Focus on Individual Effectiveness

 An organization is made up of individual members. And each member have unique values,
beliefs, and motivations.

 Organization’s effectiveness can be increased by creating a culture that achieves organizational

goals and at the same time satisfies member’s needs.

 Change efforts that focus on individual effectiveness range from empowerment training
programs to high powered executive development programs.

The goals are improved:

 Managerial skills.

 Technical skills.
  Interpersonal (connected with relationships between people )competence.

• Focus on Team Effectiveness

(part 1 of 3)

Emphasis on:

 Improving problem-solving.

 Working through conflicts.

 Group effectiveness.

 Focus on Team Effectiveness

(part 2 of 3)

 Activities focus on task activities and team process.

 Task activities—what the team does.

 Team process—how the team works.

 The quality of relationships among team members

 More effective teams can lead to improved organizations

 More effective teams may increase work motivation, improve performance, and decrease
turnover and absenteeism.

 Focus on Team Effectiveness

(part 3 of 3)

 Process observations examine (work group as systems)

 Content—the task of the group.: group process includes such factors as leadership,
decision making, communication, and conflict.

 Process—the way the group functions.: the observations are then summarized and
presented to the group.

 The purpose is to clarify and improve team functioning.

• Focus on Organization Effectiveness

 Focus on total organization system.

 Planned change programs are then designed to deal with the specific problem areas identified in
the survey. As one management theorist notes, “you don’t put two turkeys together and make
an eagle”
 Improve effectiveness by changes in:

 Structure.

 Technology.

 Management.

 OD uses planned change to improve the effectiveness of the organization.

 Planned change can focus on individuals, teams or the organization.

 Key Words and Concepts

 Client System - organization employing a practitioner to assist them in planning change.

 Closed systems - self-contained and isolated from environment.

 Content - task of the group.

 Contingency approach - attempt to determine proper management technique to employ.

 Dynamic equilibrium - steady state, reacting with environment.

 Entropy - movement toward disorder and eventual termination.

 Feedback - results, reaction from behavior.

 Future shock - inability to cope with rapid change.

 Horizontal corporation - demolition hierarchical organizational charts; reduction in layers of

management.

 Hyper turbulent environment - rapid change.

 Information overload - increasing volume of information.

 Open system - interrelated and acts with its environment.

 Sociotechnical System - open system of coordinated human and technical activities with five
major subsystems.

 System - set of interrelated elements unified to achieve a goal or purpose.

 Systems approach - set of interrelated elements unified to achieve a goal or purpose.

 Task activities - what the group does.

 Team process - how group works and relationships among team members.
 Assignment of unit-2

 Que-1 what is the implication of organization renewal for today’s organizations?

 Que-2 explain the model of approaches to change

 Que-3 explain a Sociotechnical system and its five components.

 Que-4 discuss the planned change process.

 Ans????????????????????

 Preparations for Next Chapter

 Read Chapter 3.

 Prior to class, form into groups of six and select roles. Read the instructions for OD Skills
Simulation 3.1. Complete Step 1.

 Read and analyze Case: The Dim Lighting Co.