Chapter 8 Thomas G. Cummings and Christoper G. Worley Organization Development and Change 2015 Cengage Learning 201 228
Chapter 8 Thomas G. Cummings and Christoper G. Worley Organization Development and Change 2015 Cengage Learning 201 228
Chapter 8 Thomas G. Cummings and Christoper G. Worley Organization Development and Change 2015 Cengage Learning 201 228
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Managing Change
A
fter diagnosing reveals the causes of pro- associated with successfully managing organiza-
blems or identifies opportunities for develop- tional changes.
ment, organization members begin planning Change can vary in complexity from the intro-
and subsequently implementing the changes nec- duction of relatively simple processes into a small
essary to improve organization effectiveness and work group to transforming the strategies and design
performance. A large part of organization devel- features of the whole organization. Although change
opment (OD) is concerned with interventions for management differs across situations, in this
improving organizations. The previous chapter chapter we discuss activities that must be per-
discussed the design of interventions and intro- formed in managing any kind of organizational
duced the major ones currently used in OD. change. (Tasks applicable to specific kinds of chan-
Chapters 10–20 describe those interventions in ges are examined in the chapters on intervention
detail. This chapter addresses the key activities in Parts 3–6.)
FIGURE 8.1
Activities Contributing to Effective Change Management
© Cengage Learning
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
CHAPTER 8 MANAGING CHANGE 181
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.
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
CHAPTER 8 MANAGING CHANGE 183
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.
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
A
ddressing the prevention of sexual vio- various stakeholders involved with this change
lence is a complex challenge. Unlike ciga- and the large group intervention that kicked off
rette smoking or automobile accidents, the strategic planning and implementation effort.
sexual violence is not only a health issue,
but also a social issue connected to people’s BEGINNING THE PROJECT
attitudes, beliefs, norms, and taboos. The sex-
The sexual violence prevention unit hired a
ual violence prevention unit of Minnesota’s
local OD consulting firm to facilitate the strate-
health department decided to undertake a five-
gic planning process. Everyone in the unit
year strategic planning effort to address the “pri-
believed that strategic planning was the next
mary prevention” of sexual violence. Primary
right step. Community members wanted
prevention is defined as activities that focus
action. In fact, they had stopped meeting in a
on preventing sexual violence before it occurs.
dialogue forum because they felt they were
While there have been numerous successful
not making progress in addressing the issue
programs focused on dealing with victims or
systemically or strategically.
addressing what happens after an assault,
The project got off to a rough start. The day
there was a clear need for primary prevention.
after the OD consultants began working with the
There were two driving forces for the plan.
unit, the unit director resigned. She had been a
First, the U.S. Centers for Disease Control had
major force in bringing the project to fruition, and
identified sexual violence as a key health issue
her departure represented a key challenge for
and was providing grants to states for the devel-
the consultants. In the interim, the unit’s pro-
opment of primary prevention plans. Second,
gram director and administrator stepped in to
Minnesota was a recognized leader in sexual vio-
provide content leadership with the help of the
lence prevention. The health department worked
director of MNCASA. Her departure also created
closely with the Minnesota Coalition Against
a strong need to mobilize the members of the
Sexual Violence (MNCASA), a primary recipient
unit and to recruit the necessary external stake-
of state funding, and other stakeholders who
holders with content knowledge and community
were working on sexual violence prevention.
reputation to galvanize action in the community.
This coalition had been meeting for several
To focus the key stakeholders on the
years to develop education in primary prevention
change effort, the OD consultants met with
and to engage in a cross-sector dialogue on
the departing director to identify a range of com-
the issue.
munity stakeholders to interview. The inter-
The two primary objectives of the project
views were critical in building the consultants’
were to:
knowledge of the issue and quickly establishing
• Create a strategic plan for the primary pre- relationships with key stakeholders. They also
vention of sexual violence in the state of helped identify community members who
Minnesota. could provide leadership on the project.
• Mobilize a broad range of individuals and
organizations to take action in the primary MOTIVATING COMMITMENT
prevention of sexual violence.
As part of the effort to reinforce commitment to
This application describes the activities the change process, a steering committee was
involved with motivating change within the sex- formed. It consisted of project leaders from the
ual violence prevention unit to create the strate- health department, the OD consultants, and six
gic planning process. Application 8.3 describes community members. This committee was
the activities associated with managing the responsible for identifying and recruiting other
186 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
internal and external stakeholders to participate in criterion for participation was diversity. It was impor-
the planning process. They also served as advisors tant that this group include members who could
to the OD consultants on selecting the best forum speak for underrepresented groups, such as Native
to conduct the planning, reviewing draft agendas, American, Hispanic, African American, and youth seg-
and providing feedback on plan drafts. They were ments. Everyone who was asked to participate
asked to convene for two meetings as well as pro- wanted to be part of this effort.
vide input on plans and written reports virtually. Despite this high level of commitment to the
All of the steering committee members were project, time was a big constraint. To use time
volunteers recruited by the project leaders and OD well, the consultants asked for two meetings. In
consultants after the initial interviews. The OD consul- between meetings, they drafted proposals for the
tants were part of the identification and recruitment group to react to, rather than asking members to
process because they had formed relationships with decide on the work to be done by the group. When
several of the members through previous work and members could not be at a meeting, the consul-
had established strong rapport through their inter- tants got their input individually, both before and
views. The community members of the committee after the meeting. Because of their commitment
were chosen not only because of their expertise and to prevention, all of the steering committee mem-
history in the field, locally and nationally, but also bers stayed in close contact with the consultants
because they had good process skills. Another and responded promptly to all requests.
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
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
P
remier (www.premierinc.com) is a leading In the fall of 1997, Premier hired Richard
health care alliance collectively owned by Norling as COO. Norling had been a chief exec-
more than 200 independent hospitals and utive at one of the health care systems that
health care systems in the United States. owned Premier, and his arrival signaled the
Together, the owners operate or are affiliated potential for change and new possibilities. At
with nearly 1,500 hospitals and other health his former organization, Norling had initiated
care sites. Premier resulted from the 1995 and sustained a comprehensive OD effort,
merger of Chicago-based Premier Health based on identifying core organizational values
Alliance, San Diego-based American Healthcare and the behaviors that supported them. The
Systems, and The SunHealth Alliance of experience of that health care system had
Charlotte, North Carolina. Premier offers a demonstrated that core values shaped and
comprehensive array of services and products accepted by an organization’s employees
through its companies and business units, could build a deep sense of community in the
including group purchasing, consulting services, organization, and lead to greater levels of trust
technology management services, insurance and commitment that could be harnessed to
services, benchmarking and market intelligence enhance organization performance and effec-
services, and legislative advocacy. tiveness. Given Premier’s emerging problem,
Two and a half years after the organiza- a similar approach made sense.
tion’s formation, a comprehensive organiza- In the spring of 1998, Premier executives
tional assessment suggested that Premier determined to address these issues by building
had not been successful in establishing a com- on the values and mission statements that had
mon organizational culture. Many of its ser- been developed earlier. Their intent was to
vices and employees continued to operate in involve a large number of employees in validating
a fractured or isolated fashion relating largely Premier’s values, specifying the behaviors that
to their prior organization and its geographic supported them, and identifying ways in which
location. As a result, Premier’s strategy and the values could be integrated into the routines
business model were poorly understood, and and processes of the organization—all of which
more importantly, not well implemented. The would (they hoped) infect the organization with a
assessment pointed to a growing lack of trust renewed sense of identity and enthusiasm.
in the organization. Premier executives con- The first step in Premier’s change process
ceded that the organization was culturally adrift was planning and conducting a three-day
and without a well-understood or widely values conference with over 200 employees.
accepted sense of direction. The conference was designed by a team of
Another key finding of the assessment employees representing a diagonal slice of
concerned the organization’s vision. Shortly the organization and assisted by an OD practi-
after the merger, a new set of values, tioner. At the conference, employees exam-
mission, and vision statements had been ined Premier’s business model and their
developed. The statements themselves were organizational culture; developed and recom-
clear and compelling; however, they had been mended a set of core organizational values
developed by a relatively small group of for the organization; crafted an envisioned
executives. At best, most employees did not future; and identified and proposed strategies
feel much ownership of the values; at worst, for employee involvement, integration, and
they saw the failure of top management organization transformation companywide.
to behave consistently with the values as evi- Following the conference, the team of
dence that they were not trusted, supported, Premier employees who had planned the
or important. meeting was asked to become a permanent
190 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
committee, charged with refining and implement- aimed at helping them learn whether prospective
ing plans and recommendations that the confer- employees would be a good match to Premier’s
ence participants had generated. organizational culture
Ultimately, input was obtained from over 60% • Instituting an annual meeting of approximately
of the workforce and 16 actions were recom- 200 employees from all parts of Premier mod-
mended and approved by senior management. eled after the 1998 values conference. The
Some of those actions included: agenda would be focused on business issues,
strategy, and organizational culture and values.
• Incorporating the values into Premier’s perfor-
Rotate those invited so that every Premier
mance management/performance appraisal
employee has an opportunity to attend every
system
three to five years.
• Incorporating the values into the recruitment and
selection process by developing sample inter- The outcome of the vision and values effort
view questions for use by hiring managers follows:
FOUNDATION STATEMENTS
Core Ideology
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 engaging citizens and civic resources in endeavors
By the year 2020, we will have changed the world’s that attack the causes of illness and injury. Through
view of U.S. health care to “the best and most cost- efforts that go far beyond providing treatment,
effective” at sustaining the good health of popula- people will have a sense of responsibility for their
tions. In the United States, the health care industry own personal health and the health of their
will be considered the best managed and most communities.
innovative of all the economic sectors. Together in Premier, we will invent new and
Across the nation, our owners, physicians, and superior models of delivering health services, and
other allies will lead the local transformations that we will leverage the size, linkages, and resources
are the building blocks of a reshaped health care of Premier to deliver those services to more
system. These transformations will begin to make people, at a lower cost and higher quality, than
public health and health services indistinguishable, any others will. Our owners will operate at costs
CHAPTER 8 MANAGING CHANGE 191
in the lowest quarter among all similar orga- their efforts, “Premier” will be viewed as the hall-
nizations at quality levels in the highest quarter. mark of quality and value that all others seek to
We will research and use the most effective and emulate. When people see our emblem, they will
seamless clinical approaches to achieve superior associate it with health care improvement and
health outcomes and increased values. Our com- advances in health status.
petitive edge will be the unmatched ability to Demonstrating a better way and supported by
transfer and act on our collective experience and our constituencies, we will build consensus for
innovation. national policy directions that stimulate and reward
Our owners will earn recognition as the most health and healthy communities.
valued community resource for health. As a result of We will indeed be premier.
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.
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.
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.
application 8 3
PLANNING PROJECT IN THE SEXUAL VIOLENCE
PREVENTION UNIT
A
pplication 8.1 described the beginning of them out. The steering committee members
the sexual violence prevention unit’s proj- also contacted personally any invitees they
ect to develop a five-year plan for primary knew and encouraged them to attend. The
prevention. The plan’s unique purpose was Health Unit Administrator was instrumental in
to mobilize statewide efforts to prevent sexual communicating with those invited. Follow-up
violence before it occurs. In this application, the reminders and phone calls were made to
process that the committee used to identify and ensure that an RSVP was received from every-
manage the political stakeholders—both internal one invited to attend. In addition, there were
and external—is described. regular communications on the progress of the
planning effort in newsletters, meetings, and
IDENTIFYING AND RECRUITING conferences, communication channels that
STAKEHOLDER PARTICIPATION were already in place. An important constraint
The steering committee interviewed representa- to this process was the nature of the physical
tives from various stakeholder groups, coalitions, facility that was to hold the meeting (see
and state agencies. The results of the interviews below). The steering committee had to balance
suggested (1) a need for broad involvement, espe- the need for broad participation with the limits
cially from underrepresented groups, such as of the meeting space. One tool they used was
communities of color, immigrant communities, to limit participation to the first 50 people who
gay and lesbian groups, and youth and (2) a desire signed up. This encouraged people to sign up
among those involved to move from dialogue and early to secure their space at the retreat.
education toward taking collective action. Because primary sexual violence preven-
In response to these data, the OD consul- tion was a central concern to most of these
tant proposed a two-day strategic planning stakeholders, there was little resistance in
retreat for a large group of stakeholders. This terms of interest in participating. Other hur-
format was selected because of the strong dles, however, had to be addressed, including
desire voiced in the interviews to get to action. the costs associated with attending the confer-
The steering committee confirmed that this ence, travel issues, and the time to attend. The
approach was preferable to stretching the plan- health department was able to secure funding
ning over weeks of shorter meetings. to cover participants’ costs. However, the
The unit administrator was essential in pull- steering committee had to work hard to find a
ing together the list of stakeholders who were meeting site that was within commuting dis-
invited to participate. The goal was to get as tance from many cities and able to provide
many stakeholders as possible involved, and rooms for those traveling from afar. In the
she knew the majority of people who were end, a Catholic retreat center fit many of the
active in sexual violence prevention work in requirements of the conference, but presented
Minnesota. The steering committee reviewed another set of challenges. For a few stake-
and augmented the initial list to create a diverse holder groups, there were negative percep-
group of 80 stakeholders to invite to the retreat. tions about the perceived role of the church
This group included people from the many in sexual violence; the location lacked air con-
groups, coalitions, state agencies, and under- ditioning; and there was no handicap access.
represented communities across the state. The planners of the project were also able
Invitations to attend the retreat were sent to build on several efforts that the health
out via email. The OD consultants crafted the department had previously used to gain stake-
invitation and the Health Unit Director sent holder involvement. For several years, the
CHAPTER 8 MANAGING CHANGE 195
department hosted a forum called the Sexual Vio- process would work. They agreed to meet during
lence Prevention Action Council. This group had lunch on the second day to review the work and to
been engaged in education and dialogue on the determine how to move the group toward action.
issue. Diverse stakeholders were already coming During the lunch meeting, the steering com-
together around the issues and had adopted a mittee decided that the strategies were not clear
framework developed by the Prevention Institute enough to create teams at the meeting. While the
called the “Spectrum of Prevention.” Without this group was concerned about losing people’s action
foundational work, it would have been risky to commitment, they believed it was more important
attempt to get stakeholders aligned around a stra- to have teams that made strategic sense and uti-
tegic plan in a two-day meeting. lized limited resources well. After lunch, the strate-
Finally, another tool the steering committee gies and success indicators were posted on the
initiated for gaining involvement was an online sur- wall. Consultants then used a multivoting process
vey. This survey was sent to all invitees so that to identify six priorities for action.
even those who could not attend the retreat Following the retreat, the OD consultants
would have a voice in the planning. The survey developed a proposed structure for action around
was also sent to others who were not invited to these six priorities and sent this to the steering
the retreat. They were encouraged to pass the sur- committee members for review. Their feedback
vey on to other stakeholders who might be inter- was incorporated into an action structure that
ested in this plan. Close to 100 people responded was included in the written strategic plan. Health
to the survey. A majority of respondents provided department staff members then took over the plan-
contact information and volunteered to help with ning and launching of these teams.
the plan implementation.
SUSTAINING MOMENTUM
CONDUCTING THE MEETING When the strategic planning project had begun, the
Fifty invitees were able to attend the planning head of the sexual violence prevention unit had left
retreat. Using a large-group OD process over two the organization, and the position had gone unfilled
days, participants worked together to create the throughout the project. Just prior to the retreat, a
framework of a strategic plan. Part of the planned well-known state leader in sexual violence work,
agenda was to have stakeholders sign up for an Patty Wetterling, agreed to fill the position. Seven-
action team toward the end of the two days. The teen years earlier, Wetterling’s young son had been
dilemma faced during the session was in trying to abducted in their small Minnesota town and was
get both focused strategies and a very diverse group never found. Her work in establishing new laws
of stakeholders to take action. Actions would need regarding abductions as an advocate and state leg-
to occur both at the state level and within individual islator, as well as a run for the U.S. Senate, made
communities. Going into the meeting, the steering Wetterling a perfect choice to provide statewide
committee was not sure that the team sign-up leadership in implementing the strategic plan.
FIGURE 8.3
Organization Change as a Transition
© Cengage Learning
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
application 8 4
ACQUISITION
I
n the Fall of 2001, Carly Fiorina announced line for decision making. Their research on suc-
HP’s intent to acquire Compaq Corporation. cessful and unsuccessful acquisitions and
Over the next nine months, a proxy fight Clarke’s experience with the Digital acquisition
ensued as many shareholders and employ- convinced them that slow decision making and
ees challenged the wisdom of the proposed the lack of a clear decision-making process was
change. Wall Street analysts and organization like a cancer in the transition process. In
researchers too debated whether or not the response, they created the “adopt and go”
acquisition made sense, especially given the strategy: Get cross-company pairs of managers
size of the change and the rather dismal history to meet daily to determine the best choice or
of performance in acquisition cases. Scott best course of action on any particular issue.
McNealy, chief executive of rival Sun Micro- Weekly meetings kept the pace fast. If any
systems Inc., predicted “a slow-motion issues couldn’t be resolved by the teams,
collision of two garbage trucks.” McKinney and Clarke would jump in. If those
Within days of the initial announcement, two couldn’t resolve the impasse, they’d pass
however, Fiorina and Michael Capellas, then it to a committee chaired by Fiorina.
CEO of Compaq, met with Webb McKinney, a In addition to getting the right people on
19-year HP veteran, and Jeff Clarke, Compaq’s board and setting up a decision process built
CFO and survivor of Compaq’s acquisition of for speed, the transition team created activity
Digital Equipment Corporation. These two plans for the key issues facing the integration,
men were named to lead the transition pro- including people, products, culture, Day-one
cess, one that would involve redeploying a activities, and day-to-day operations. Excerpts
combined 145,000 workers in 160 countries and examples from some of those plans are
including more than 15,000 layoffs, untangling reviewed below.
163 overlapping product lines, and producing
$2.5 billion dollars in promised cost reductions. • The “adopt and go” process was used to
It was no accident that McKinney and Clarke decide which products to keep and which to
were asked to lead the integration team. Both discontinue. At weekly presentations with
were senior managers with substantial follow- McKinney and Clarke, managers had to
ings and excellent reputations. Days after their offer up one for elimination. In contrast to
initial meeting, they began recruiting managers Compaq’s merger with Digital, HP execu-
in equal numbers; Clarke rounded up Compaq tives made quick product decisions and
talent and McKinney lined up their HP matches. every week pored over progress charts
Within weeks of the merger’s announcement, with red, green, and yellow markers to
the integration group, called the “clean team,” review how each product exit was proceed-
had 500 members; by March 2002, more than ing. Red and yellow markers indicated a
900. Even after the merger closed in May 2002, task was troubled; green signaled a task
it kept growing, peaking at more than 1,000 full- going well. In four months, a road map for
time employees. By establishing such a huge product lines emerged and helped to close
body of outstanding managers and reassuring redundant warehouses and factories, ulti-
them that their jobs would be safe even if the mately saving $500 million in procurement
merger failed, Clarke and McKinney were able to costs. In the end, while many Compaq pro-
coax them to share in confidence everything ducts beat out HP’s, such as Compaq’s iPac
they knew. It also kept most of them motivated over HP’s Jornada, the HP brand survived.
to stay—another critical benchmark. • The “adopt and go” process also helped
In addition to getting the right people on HP make the hard decisions about person-
board, McKinney and Clarke set up an assembly nel appointments. HP appointed its top
CHAPTER 8 MANAGING CHANGE 199
three tiers of executives before the acquisition expected to work together. All of this material
was finalized and made new levels of appoint- was pushed out into the HP market before the
ments every few weeks. While not perfect— launch, inviting a few thousand of the top HP
rumors that Compaq people were favored in managers to an orientation and education ses-
the sales organization—Clarke contends that sion on what to do, how to communicate, and
all decisions were made “by the book.” the details of the new HP and their roles in it.
• HP created a team to deal specifically with • The clean team also made extensive “Day-one”
melding the corporate cultures and hired consul- plans. Day-one readiness included plans to
tants to document the differences. To address address customers, issues of leadership and
perceptions that Compaq employees were structure, and internal administrative issues.
“shoot from the hip cowboys” and that HP The new HP was launched with everyone on
staff members were “bureaucrats,” the team the same email, not a paycheck missed, and
created a series of cultural workshops. They every sign changed the morning of launch day.
were designed to identify the various cultures Customers participated heavily in the transition
and subcultures, and then integrate them. For process. Customer councils, interviews,
example, key sales managers and about two research, information sessions, education, and
dozen salespeople from both HP and Compaq other data were included in the knowledge trans-
held a workshop designed to address sales inte- fer to groups that faced the customer. The go-
gration and transition issues. Many attendees to-market plans were detailed, with playbooks
first looked at each other suspiciously. Following given to each group manager who touched the
some ice-breaker exercises, however, an HP customers, so that on launch day they knew
representative talked about how HP had been what to do, what to say to a customer, where
working with key customer SBC, the telecom- to get information. Each customer was given an
munications company. That was followed by a HP buddy from the same level so that he or she
Compaq rep discussing how it sold to SBC. could contact that person and get whatever infor-
Then the big group drew up a 100-day work mation the customer needed. There was an
plan for selling to SBC in the future, including enormous amount of detail, down to the script
a weekly conference call for the team every of what to say, what answers to give to specific
Friday. The progress from these sessions was questions, where to get further information, and
tracked by a team of 650 part-time internal “cul- how to transition an inquiry to the right person.
tural consultants,” who also continued in their
normal jobs at the company. By most measures, this transition work paid
• The cultural workshops delivered in the first off: HP met the integration goals that Chairman
quarter after the deal was signed set the and Chief Executive Carleton S. Fiorina set for the
stage for further cultural integration. The work- merged company. The biggest of these was cost
shops welcomed everyone to the new team, savings, which surpassed expectations. By mid-
described the HP business, HP’s values and 2003, HP said it saved $734 million—14% more
operating models, the roles and objectives than projected—from payroll cuts and better terms
of different groups, and how people were with its suppliers.
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
200 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
application 8 5
IN MELBOURNE, AUSTRALIA
R
MIT University is a large tertiary educa- LEADERSHIP DEVELOPMENT
tional institution located in Melbourne As part of a broader University-level leader-
Australia. The university has more than ship development program—leadRMIT—the
75,000 students, including approximately RMIT University Library worked to strengthen
16,000 students attending an off-shore campus its leadership capacity. Since 2008, the library
or studying with partner institutions. Australian has recognized 18 to 20 staff as a “leader-
education is undergoing rapid change in ship” group. The group identified the positive
response to various government initiatives, the and negative elements of the library’s existing
change to a “demand-driven” system, and a culture. Desirable changes to the culture were
general tightening of funding. These pressures then identified and a variety of leadership
have resulted in the need for more innovation in development activities were provided to
the education process and increased leadership equip managers to support the agreed direc-
capacity to support these changes. tion. This included participating in the lead-
In addition to the changes in the broader RMIT courses which involved several full-day
education environment, the large amount of sessions with expert external facilitators over
technological change in the information industry a few months. In addition, survey instruments
provided the library management and staff an that identified the leadership skills and
important context and encouragement to inno- emotional competencies of the managers
vate and change. The most direct and obvious provided insights into the approaches and
indicator of the changing role of the library leadership styles that supported staff engage-
was the steady drop in its traditional form of ment. The library arranged sessions to
service—loaning out books. Despite a 33% address specific people management skill
increase in students between 2000 and 2010, needs. After the initial batch of training, a
the number of book loans per student declined round table was formed as an ongoing oppor-
from 10.8 to 5.7. Other indicators of library use tunity to share insights gained from profes-
also changed, including a shift from long, in- sional reading, conferences, and other
depth reference questions from faculty and stu- sources, and to discuss leadership and man-
dents to shorter and more specific inquiries. agement issues.
Engaged staff and confident leaders were
needed to adapt to changed patterns of use, to
meet changing user expectations, and to envis- THE CUE PROGRAM
age and implement new approaches to service. As in any large library, there was a tendency
However, input from a broad leadership group towards a culture of specialization in the work-
formed inside the library and an organization- place. Staff in the loans area, for example, had
wide climate survey, which provided results at little knowledge or experience in the technical
unit level, indicated that library staff engage- service areas, and those in technical service
ment levels were below desirable levels. areas tended not to have experience working
Over the last five years, the RMIT University with library users. To overcome this “silo effect”
Library has adopted strategies that were designed and build a more flexible workforce, cross unit
to increase and sustain employee engagement work experience opportunities (called “CUEs”)
and levels of innovation. The library’s initial were instituted in 2008. Under this system, man-
approach involved four interventions: leadership agers were invited to create training opportu-
development, specific purpose working groups, nities that were then placed on an internal
cross unit work experiences, and increased register. A CUE was initiated by a librarian
involvement in professional associations. expressing interest in an opportunity that was
CHAPTER 8 MANAGING CHANGE 203
mediated by the staff development librarian. Four cat- Although every intervention ideally should
egories of CUEs were defined, including: receive a separate and formal assessment, sev-
eral indicators were used to sense implementa-
1. Short, half-day opportunities over a three-day
tion success and suggest follow-on activities. For
period were primarily aimed at staff in their
example, a management skills audit undertaken in
first two years of employment to enhance
late 2010 and early 2011 affirmed significant prog-
cross unit cooperation.
ress in the overall confidence levels of managers
2. A shadowing assignment provided a short-
regarding their people management skills. Anec-
term opportunity to gain insight into another’s
dotal evidence, evaluation forms provided by par-
work, often where actually doing the work was
ticipants in the CUE program, and the ongoing
not feasible.
commitment of managers to create and support
3. Longer one-day/week for six months opportu-
the scheme indicated that the experience was
nities promoted multiskilling and workforce
valuable for the staff member and productive
flexibility.
from the manager’s perspective. Finally, the
4. Full-time immersion experiences over four to eight
impact of participation in cross unit projects and
weeks provided an opportunity to deepen and
the specific purpose groups had clearly had posi-
enhance multiskilling and workforce flexibility.
tive impact on participants.
To sustain the staff’s engagement and to
SPECIFIC PURPOSE WORKING GROUPS encourage additional innovation at the library, a
A variety of specific working groups were created to simple innovation process was created and was
encourage more open and innovative approaches to supported by an individual and team development
the changing environment. For example, the New program.
Professionals Group was created with the intention
of entrenching a positive organizational culture and A MODEL OF INNOVATION
developing organizational savvy and capability. It The RMIT University Library innovation process
was hoped that the formation of this group would was modeled after popular processes developed
support the less-experienced professionals to act as by IDEO as well as library specific processes
change agents. Similarly, the Innovative Librarians located through benchmarking efforts. In itself the
or “Innovatives” group focused on exploring new model was far from novel, but its simple “gener-
technologies, communicating these to staff, and ate, develop and deploy” labels provided a com-
making recommendations as to how these might mon language for units and staff across the
be used. One of the challenges in terms of the library and served as a basis for skill development
impact of this group was that the members were in support of innovation.
in relatively low-influence positions in terms of tradi- For example, a short-term specific-purpose
tional hierarchy and they often lacked strong advo- working group was formed to select and describe
cacy skills and confidence. idea generation techniques considered appropriate
to the RMIT University Library. This group also devel-
INVOLVEMENT IN PROFESSIONAL oped approaches for strengthening ideas. They
ASSOCIATIONS wanted to avoid “idea assassination” where ideas
To maximize innovative activity requires buy-in were recommended without adequate thought and
which extends beyond leaders and select indivi- to ensure that good ideas were as well presented as
duals. As a result, the university librarian promoted possible before formal approvals were sought. This
involvement in professional associations and led by necessitated clarifying criteria used to decide
example. Library staff were encouraged and sup- whether or not to accept and implement sugges-
ported to participate in professional activities, tions, and reaching agreement on a template for
including attending and presenting at meetings making suggestions and providing feedback. To
and conferences, writing news items and articles, ensure this work was not isolated from reality, tech-
and undertaking study tours. niques were piloted on current library projects.
204 PART 2 THE PROCESS OF ORGANIZATION DEVELOPMENT
INDIVIDUAL AND TEAM DEVELOPMENT The RMIT University Library used initial
To support broader individual and team skill interventions and an informal midterm
development, the library adopted a team man- assessment to track the progress of the
agement profile process. Staff members com- change and then crafted additional interven-
pleted an online survey and then participated in tions to sustain the change. The initial inter-
workshops to understand the sources of team ventions of leadership development to
effectiveness, to gain insights into and apprecia- enhance the knowledge, motivation, and
tion of diverse approaches to work, to assess skills of managers to engage staff; cross
team strengths weaknesses and priorities, and unit work experiences to build a more flexible
to take steps to enhance effectiveness. While workforce; specific purpose working groups
the workshops did not place a major focus on to address particular issues; and the promo-
the link between team effectiveness and inno- tion of involvement in professional associa-
vation, the team management profiles and tions helped start the change. Subsequently,
workshop experiences laid an important founda- adoption of a common innovation process
tion for improving innovation levels by identify- model and the provision of practical team
ing individual work preferences, affirming the effectiveness techniques helped to sustain
value of each person’s unique contribution, innovation and engagement in the organiza-
increasing understanding between individuals tion. A repeat organizational climate survey
which may increase levels of trust, and opening in the future will help to determine whether
up conversations on new ways of thinking the engagement levels have risen among
about work. library staff.
SUMMARY
In this chapter, we described five kinds of activities that and devise strategies for gaining their support. The
change agents must carry out when planning and fourth activity concerns managing the transition of
implementing changes. The first activity is motivating the organization from its current state to the desired
change, which involves creating a readiness for change future state. This requires planning a road map for
among organization members and overcoming their the change activities, as well as planning how to gain
resistance. The second activity concerns creating a commitment for the changes. It also may involve cre-
vision that builds on an organization’s core ideology. ating special change-management structures and a set
It describes an envisioned future that includes a bold of learning processes that accelerate the transition. The
and valued outcome and a vividly described desired fifth change task is sustaining momentum for the
future state. The core ideology and envisioned future changes so that they are carried to completion. This
articulate a compelling reason for implementing includes providing resources for the change program,
change. The third task for change agents is developing creating a support system for change agents, develop-
political support for the changes. Change agents first ing new competencies and skills, reinforcing the new
must assess their own sources of power, then identify behaviors required to implement the changes, and stay-
key stakeholders whose support is needed for change ing the course.
CHAPTER 8 MANAGING CHANGE 205
NOTES
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