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Chapter 13

Chapter 13

12 Pages
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Department
Human Resources
Course Code
MHR 405
Professor
Louis Pike

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Chapter 13: Org Change and Development
Challenges leading to change: increased globalization, hyper-competition, demanding customers, increasing
diversity of workforce, continuing technological innovation and demands for higher levels of moral and
ethical behaviour
1. Massive org change is inevitable given the volatile nature of our competitive environment
2. Adaptive flexible org will have competitive advantage over those who are not.
4 targets of change
oStructure (downsizing, mergers, acquisitions)
oTechnology
oTask/work processes
oPeople and culture
First and Second-order planned change (p380)
Planned org change: process by which org move from their present state to some desired future state to
increase their effectiveness
oOrg survival and effectiveness require change before crisis hits
E.g. heart attack start to exercise
John ChambersChange during good times while maintaining a steady course when times
get rough
oExpecting the unforeseen means that leaders view their org as open systems and continually scan
and monitor their internal and external environments for potential challenges and opportunities.
oPlanned org change Variables time, scope, depth
o2 distinctions in magnitude of p.o.c
1. First-order incremental (developmental) change: change involving adjustments in
systems, processes, or structures with the purpose of maintaining or developing the org.
Reflect a fine-tuning of the org, making small improvements, or transition to
something new
2. Second order discontinuous (transformational) change: change in which org moves
to a radically different and sometimes unknown, future state
Difficult b/c orgs mission, culture, goals, structure and leadership can change
dramatically.
Judith Chapman gamma change transition from one stat to another
1
www.notesolution.com
Requires leap of faith for org.
E.g. Corning (cookware manufacture) transformed into fibre optics powerhouse
Targets of Change (p381)
1.Orgs structure
2.Technology
3.Task/work processes
4.Its people and culture
Changing Org Structure
Org structure (OS): how an orgs work is designed and how departments, divisions, and overall org are
designed
Manner of change in org structure (aka restructuring)
oDownsizing (reduce the size of the workforce)
oMergers and acquisitions (Form strategic alliances, Joint ventures, outsource part of their
operations)
Downsizing: Process by which managers streamline the org hierarchy and lay off managers and workers to reduce
bureaucratic costs
Popular method of cutting costs, but criticized having impacts on service quality, and emotional and
behavioural commitment/response of survivors
Consequences huge increase in workload, search for such meaning, social and org isolation, decreased
family functioning.
6 best downsizing processes (by white-collar in U.S. automobile firms)
o1. Implementation was not only by command from top down, but initiated from bottom up.
o2. Focus was short-term and across-the-board, but also long-term and selective in emphasis
o3. Special attention was paid both to those employees who lost their jobs and to the survivors
o4. Targets were inside the firm, but also included the firms external network
o5. Downsizing resulted in both small, semiautonomous orgs and large, integrated orgs.
o6. Downsizing is emphasized as a means to an end rather than an end in itself.
oOrg structure is defined by how tasks are formally divided (differentiation) and coordinated
(integration)
oRestructuring includes (de-layering) e.g. CNR reduced 10-5 mgmt levels
2
www.notesolution.com
Mergers and Acquisitions (p383)
Often involve downsizing ; e.g. AOL and Time Warner, layoff of 15000 employees
In addition to downsizing, org have to deal with challenges of integrating two, often distinct, corporate
cultures.
Differences between smooth and problematic merger depends on degree to which senior managers take the
necessary steps to blend the cultures of the merged companies (merger culture experts to help them)
Changing the Org Technology, Work processes, and Tasks
Early studies focus at technological change
Today introduce new equipment, tools or automation for competitive factors
Techniques such as TQM (total quality management), reengineering, and flexible manufacturing have
become common targets of change for demands of cost reduction and quality.
TQM and reengineering popularized by Michael Hammer and J.Champy is theFundamental re-thinking
and radical redesign of biz processes to achieve dramatic improvements in critical, contemporary measures
of performance (cost, quality, service, and speed)”
oReengineer: process by which managers redesign how tasks are bundled into roles and functions to
improve org effectiveness.
Changing Peoples Attitudes and the Org Culture
Org culture: pattern of basic assumptions that are considered valid and that are taught to new members as
the way to perceive, think, and feel in the org
Cultural change takes longer than structural because it often requires re-examination of corporate values.
Challenges to Effective Change Mgmt (p384)
Individual Reactions against Org Change
Rational responses based on self-interest.
Reactance a negative reaction that occurs when individuals feel that their personal freedom is threatened
# of confident Canadians in ability to cope with change has declined in recent years
Traditional OB refer to employee reactions to change asresistance
Contemporary OB view it as possible red flags regarding areas for improvement in the change process as
well as potential sources of important info
oReactions vs resistance
Common types of reactions
Fear of unknownWhat will I be expected to do?
3
www.notesolution.com

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Description
Chapter 13: Org Change and Development Challenges leading to change: increased globalization, hyper-competition, demanding customers, increasing diversity of workforce, continuing technological innovation and demands for higher levels of moral and ethical behaviour 1. Massive org change is inevitable given the volatile nature of our competitive environment 2. Adaptive flexible org will have competitive advantage over those who are not. 4 targets of change o Structure (downsizing, mergers, acquisitions) o Technology o Taskwork processes o People and culture First and Second-order planned change (p380) Planned org change: process by which org move from their present state to some desired future state to increase their effectiveness o Org survival and effectiveness require change before crisis hits E.g. heart attack start to exercise John Chambers Change during good times while maintaining a steady course when times get rough o Expecting the unforeseen means that leaders view their org as open systems and continually scan and monitor their internal and external environments for potential challenges and opportunities. o Planned org change Variables time, scope, depth o 2 distinctions in magnitude of p.o.c 1. First-order incremental (developmental) change: change involving adjustments in systems, processes, or structures with the purpose of maintaining or developing the org. Reflect a fine-tuning of the org, making small improvements, or transition to something new 2. Second order discontinuous (transformational) change: change in which org moves to a radically different and sometimes unknown, future state Difficult bc orgs mission, culture, goals, structure and leadership can change dramatically. Judith Chapman gamma change transition from one stat to another 1 www.notesolution.com Requires leap of faith for org. E.g. Corning (cookware manufacture) transformed into fibre optics powerhouse Targets of Change (p381) 1. Orgs structure 2. Technology 3. Taskwork processes 4. Its people and culture Changing Org Structure Org structure (OS): how an orgs work is designed and how departments, divisions, and overall org are designed Manner of change in org structure (aka restructuring) o Downsizing (reduce the size of the workforce) o Mergers and acquisitions (Form strategic alliances, Joint ventures, outsource part of their operations) Downsizing: Process by which managers streamline the org hierarchy and lay off managers and workers to reduce bureaucratic costs Popular method of cutting costs, but criticized having impacts on service quality, and emotional and behavioural commitmentresponse of survivors Consequences huge increase in workload, search for such meaning, social and org isolation, decreased family functioning. 6 best downsizing processes (by white-collar in U.S. automobile firms) o 1. Implementation was not only by command from top down, but initiated from bottom up. o 2. Focus was short-term and across-the-board, but also long-term and selective in emphasis o 3. Special attention was paid both to those employees who lost their jobs and to the survivors o 4. Targets were inside the firm, but also included the firms external network o 5. Downsizing resulted in both small, semiautonomous orgs and large, integrated orgs. o 6. Downsizing is emphasized as a means to an end rather than an end in itself. o Org structure is defined by how tasks are formally divided (differentiation) and coordinated (integration) o Restructuring includes (de-layering) e.g. CNR reduced 10-5 mgmt levels 2 www.notesolution.com
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