HOW TO USE THIS GUIDE Dear CalUniversity Student/learner: This Study Guide is intended to facilitate key learning points found in the textbook. Read this guide as you go through each unit of your course. Reflect on the â€˜Ask Yourselfâ€™ questions as a TRA (Transfer, Retention, and Application) method. The guide is organized as follows: - An overview of learning objectives - Key learning points of each chapter - Weekly Discussion Questions - Unit Case Analysis - Mini Project - Final Exam - Week 6 Discussion Questions - End of Course Survey - Course Project - Course Presentation This guide is not a substitute for the textbook. The Summary at the end of each Chapter of the textbook highlights the learning points for each chapter and must be read. You must read the Syllabus and other documents posted in the Course Document folder of your Course Room so you will understand how to maximize learning and earn the desired grade. Please do not hesitate to contact your course instructor if you have any questions. Academic Department California InterContinental University May 2014 Updated 5/12/14 California InterContinental University | 5 of 83 Course Overview MGT 616: Organizational Change & Development Management System Course Description: This course covers organizational change through the lens of micro (individual-level) organizational behavior. It identifies the pros and cons of perception, decision-making, motivation, and diversity/individual differences. It covers analysis and development of organizational theories, with emphasis on environmental dependencies, socio-technical systems, structural design, and control of the performance of complex systems. Organizational changes such as barriers to change, appropriateness of intervention strategies and techniques, organizational, and evaluation of formal change programs will be covered. Finally, the course provides a diagnostic approach for the students/learners to explore the nature and impact of change Course Objectives: ? To provide various perspectives on organizational behavior and the principles of planned change ? To provide insight into the knowledge and skills needed to practice organization development. Learning Outcomes (LO): At the end of the course, student/learners will be able to: LO 1. Describe how organizational change is tied to strategic renewal and change implementation LO 2. Explain steps in a process of change driven by growth and globalization LO 3. Apply theories of effective change implementation. LO 4. Describe techniques to decide on a change strategy LO 5. Apply tools for achieving mutual engagement and shared diagnosis in a change process. LO 6. Follow procedures for diagnosing the pattern of behavior within a top leadership team LO 7. Explain phases of organization redesign LO 8. Compare methods for managing virtual global teams for increased coordination May 2014 Updated 5/12/14 California InterContinental University | 6 of 83 LO 9. Describe people alignment strategies within an organizational change process. LO 10. Explain how to use training to drive new behaviors. LO 11. Compare strategies to reinforce new organizational behaviors. LO 12. Define how organizational structure can change to support the new strategy. LO 13. List effective practices for leading change. LO 14. Describe how organizations can invest in leadership development. LO 15. Examine organizational change strategies that support sustainability. May 2014 Updated 5/12/14 California InterContinental University | 7 of 83 UNIT ONE Chapters & Learning Outcomes The key points of the following chapters (see textbook) will be discussed in this Unit: - Chapter One Organizational Change Pages 2 to 23 - Chapter Two Theories of Effective Change Implementation Pages 24 to 50 UNIT ONE LEARNING OUTCOMES This Unit meets the following learning outcomes: LO 1. Describe how organizational change is tied to strategic renewal and change implementation LO 2. Explain steps in a process of change driven by growth and globalization LO 3. Apply theories of effective change implementation. LO 4. Describe techniques to decide on a change strategy May 2014 Updated 5/12/14 California InterContinental University | 8 of 83 CHAPTER ONE Organizational Change KEY LEARNING POINTS This chapter recognizes that organizations engage in a process of strategic renewal in order to respond to changes in their competitive environment. But in order to make strategic renewal work, leaders must find ways to alter the behavioral patterns of their employees through involvement and participation. INTRODUCTORY CASE: ORGANIZATIONAL CHANGE AT NOKIA (Page 2) Review the case which illustrates that an organization cannot remain static if they want to continue to succeed. Nokia, the worldâ€™s leading producer of cell phones, had experienced a dramatic drop in the United States market share, from a high of 35% to 7%. In an attempt to repair the damage they added Americans to their senior management team. STRATEGIC RESPONSIVENESS (Page 3) Four definitions of concepts are provided. 1. Change implementation: actions taken by organizational leaders in order to support strategic renewal and maintain outstanding performance in a dynamic environment. 2. Strategic renewal: a change in an organizationâ€™s strategy involving some combination of new products; services, new markets and a new business model. 3. Organizational capabilities: the collective talents and skills of a firmâ€™s employees. 4. Discontinuous change: large â€“scale, long-term reorientation of most or all of the central aspects of organizational life. All for of these concepts must be analyzed to improve the organizationâ€™s strategic responsiveness. Ask yourself: Can you identify at least one change of strategic renewal occurring in an organization to which you belong? THE THREE FACES OF CHANGE (Page 5) The book notes three different approaches to change. 1. Turnaround 2. Tools and techniques 3. Transformation May 2014 Updated 5/12/14 California InterContinental University | 9 of 83 Turnaround involves company assets and is used to improve short-term bottom-line performance. It looks at a companyâ€™s assets and seeks to manage them in a new way in order to stabilize cash flow, shore up the balance sheet and maximize shareholder wealth. The example illustrating this concept involves MySpace. As the Theory into Practice summary states, â€œNot all change is behavioral.â€ Techniques and tools focus on processes and is used to increase internal efficiencies. These include organizational processes, mechanics and other interactions intended to produce a product or service. Review Exhibit 1-2 Popular Change Tools and Techniques on page 6. This summarize a number of change management tools and techniques including: total quality management, Agile development, balanced scorecard, value-chain integration, lean and considered design. Transformation focuses on behaviors to enhance human capabilities. Transformation involves a change intervention that directly targets the patterns of employee actions and interactions. It helps describe how employees will work to meet the companyâ€™s strategy and to achieve and sustain outstanding performances. Review Exhibit 1-3 Three Faces of Change. It illustrates each type of change, t While the three concepts can be applied separately, effective change efforts combine all three, the book notes. Additional attention is provided for Transformation. Ask yourself: Have you been part of a change process? TRANSFORMATIONAL CHANGE (Page 7) The collective enactment of the roles, responsibilities and relationships of employees â€“ that is, the patterns of employee behavior within organizations constitutes the target of transformational change efforts. The Theory into Practice summary states: Transformational change seeks to create long-term, sustainable alterations in employee behaviors. Motivation refers to the degree to which employees are committed to the achievement of outstanding performance both for themselves and for their company. The Theory into Practice summary states: The way employees conduct themselves at work impacts the bottom-line performance of the company. Transformational change leverages the behavior of many employees by looking at the organizational context in which they work. Organizational context refers to the setting and circumstances in which employees work. Companies call upon organizational culture and values, the behaviors of leaders as well as rules and procedures to define a context that shapes employee conduct. May 2014 Updated 5/12/14 California InterContinental University | 10 of 83 Ask yourself: Consider smoking-cessation efforts as part of an organizational change effort. How do they improve the bottom-line? What values is a company encouraging employees to assume? EMPLOYEE PARTICIPATION AND RESISTANCE TO CHANGE (Page 10) This section examines the sources of employee resistance to change and the ways in which managers can overcome resistance. Resistance refers to actions overt or cover, exerted on behalf of maintaining the status quo. Why Employees resist change Review Exhibit 1-4 Continuum of Individual Response to Change on page 10. The level of resistance is strongest at the bottom of the continuum from aggressive resistance to the least resistance having employee commitment to attain the goals of the change effort. The Theory into Practice summary states: Employee resistance is not just a negative force to be overcome, it also presents an opportunity to learn. How managers can inadvertently fuel resistance during a change implementation The book reinforces that there is not an certain type of individual who are more likely to resist change than others. The primary determinant of employee reaction to change comes from how the process is managed and the degree to which employees are allowed to participate in the process. Review the checklist of employee resistance and possible sources of that resistance which is shared on page 12. When employee resistance is treated as a negative force to be overcome, management risks shutting down the possibility they can learn from the resistance. Managers must stay open to receiving feedback from the employees about the changes being considered. There comes a point in the change process where employee resistance will need to be addressed and overcome, this is discussed further in Chapter Two. Employee Participation Builds Support for Change Managers want to consider change management techniques for building support for the change effort. Participation is the process of allowing employees a voice in the work-related decisions. Employees develop a psychological ownership over the change outcome. This increases motivation to implement change in order to achieve the desired goals. New behaviors will not be sustainable if they have been prompted by manipulation or coercion. Effective change encourages employee to find continually new and improved ways of applying their better judgment. Ask yourself: Have you ever been forced to change at work? How long did it last? Have you had a manager who listened to employee ideas about the change? How was that different? May 2014 Updated 5/12/14 California InterContinental University | 11 of 83 The managerâ€™s challenge is to shape the organization context in such a way as to encourage internal desire on a large number of employees to alter behaviors in ways consistent with the demands of the new change strategy. TRIGGER EVENTS AND CHANGE (Page 14) Trigger Events present a shift in the environment that precipitates a need for organizational change, a need to alter the behavioral patterns of employees. They stir up feelings and emotions that come to affect peopleâ€™s reactions to the change. Ask yourself: How did the trigger events of the September 11, 2001 with the destruction of New York Cityâ€™s World Trade Center twin towers affect how employees of airports behave? Can you trace trigger events in your work organizationâ€™s history? GOING GLOBAL AND THE REQUIREMENTS FOR ORGANIZATIONAL CHANGE (Page 14) The text highlights several types of change involved with going global. These include: ? Outsourcing activities that had previously been performed in the home country. ? Seeking to enter new, non-domestic markets. ? Using non-domestic suppliers for raw materials. ? Forming strategic alliances with companies in other countries ? Locating research and development activities in many countries in order to better understand the needs of a non-domestic market. All efforts to go global will require organizational change. Going global adds an extra variable to the change effort. Psychic distance is a measure of the differences in culture, language, and the political-economic-legal infrastructure of countries that add to the complexity of managing across national borders. Review the Conclusion of Chapter One Organizational Change on Page 15. May 2014 Updated 5/12/14 California InterContinental University | 12 of 83 Activity Week One Discussion Question (Chapter One): The purpose of the discussion question is to allow you as the student/learner to demonstrate your understanding of the chapterâ€™s key learning points and how you might apply them in given situation. Participating in the discussion question forum provides you as the student/learners an opportunity to compare your ideas to ideas from others in your class. Instruction: Using the chapterâ€™s key learning points, provide your answer to the questions below. What are the three approaches to organizational change? In what ways are they different and in what ways do they overlap? May 2014 Updated 5/12/14 California InterContinental University | 13 of 83 CHAPTER TWO Theories of Effective Change Implementation KEY LEARNING POINTS INTRDUCTORY CASE: TURNAROUND AND TRANSFORMATION AT DUKE UNIVERSITY CHILDRENâ€™S HOSPITAL (Page 25) The case illustrates an effective change implementation at a university hospital using key concepts in this chapter such as process-driven change and task alignment. THEORIES OF CHANGE IMPLMENATION (Page 26) Understanding effective change implementation requires understanding what levers can be appliedâ€” diagnosis, cross-functional teams, measurement systemsâ€”and in what sequence. Theory into Practice: Effective change involves both content (what is being changed) and process (how the changes are being implemented). Kurt Levinâ€™s Field Theory in Social Science Kurt Levin is a noted social scientist from 1946 whose theories shape much of organization change implementations. He noted two key variables to be considered: 1. Context plays a decisive role in shaping individual behaviors. 2. Creating is dissatisfaction with the status quo is the only way to motivate an individual to change her pattern of behavior. The text analyzes these two variables further. Changing behaviors by changing context is shaped both by an individualâ€™s psychology and the group setting in which she finds herself. Lewin captured the concept in this formula: B = f(P, E) Behavior is a function of the person herself (P) and the environmental context (E) in which that person operates. Person and context are interdependent variables shaping behavior. The question Lewin addressed was: How can that context be change? May 2014 Updated 5/12/14 California InterContinental University | 14 of 83 Simply telling employees about a change will not make it happen. The context of change needs to be influence by assigning positive value to breaking a social habit. Norms are shared expectation of how group members ought to behave and come to be viewed by group members as good things: standards to be cherished and upheld. Theory into Practice: Telling employees why they need to change will not build motivation to change; it is necessary, but not sufficient. Creating Dissatisfaction with the staus quo is another significant step for change leaders. Theory into Practice: Donâ€™t assume that poor organizational performance will create an urgent nee d to change within a company. Lewinâ€™s explanation for this phenomenon is that the more people assign a positive value to belonging to group membership and group norms, the greater the resistance will be on the part of individual group members to alter those norms. Theory into Practice: To break the â€œsocial habitsâ€ that support existing patterns of behaviors, start with creating dissatisfaction, disequilibrium and discomfort. Levwinâ€™s change model involves three stages: 1. Unfreezing 2. Moving 3. Refreezing Unfreezing is the first stage in Lewinâ€™s change model in which group members become dissatisfied with the status quo. Moving is the second stage in Lewinâ€™s change model in which group members alter their pattern of behavior. Refreezing is the third and final stage in Lewinâ€™s change model in which group members institutionalize the new patterns of behavior into a new status quo. Lewinâ€™s contribution to change implementation. Review Exhibit 2-1 Implementation of Lewinâ€™s Change Model on Page 30 for a summary of actions in each of the three stages within the change model. Theory into Practice: In order to implement change, target group norms first and then focus on individual behaviors. May 2014 Updated 5/12/14 California InterContinental University | 15 of 83 To create sustainable behavioral change, leader need to leverage working at the contextual group norms level. This will motivate individuals to adapt to the new norms. The book notes some weaknesses in Lewinâ€™s theories regarding group responses to a change intervention process. It emphasized that the impact of context on behaviors and the requirement to create disequilibrium in order to motivate behavioral changes continues to hold true. Ask yourself: Is there a change you want your work group to consider? What dissatisfactions with the status quo can you use to motive the change you desire? ORGANIZATION DEVELOPMENT AND CHANGE IMPLEMENTATION (Page 30) Organizational Development (OD) is an approach to organizational effectiveness that calls on the fields of behavioral and social sciences to provide guidance to planned change efforts. OD offers a complex and systemic perspective on how and why people behave and organizations operate. OD provides instight into the process of changing peopleâ€™s behaviors and organizationâ€™s operations. Review Exhibit 2-2 Ten Perspectives of Organizational Development on Page 31. The exhibit shares underlying assumptions about each of the perspective to help understand an effective change implementation. Three insights (# 1, 6 and 8 within the Exhibit)are further developed within the chapter. 1. Systems Perspective: Organizations are open systems. Organizational effectiveness is best achieved when a state of fit or congruence exists between various elements of an open system. Review Exhibit 2-3 A congruence Model of Effectiveness on Page 32. This illustrates the interdependence of the various subpart involved in three major categories of internal context, external environment and patterns of employee behavior to creat organizational effectiveness. Theory into Practice: Performance problems often reside in the hand-offs between employees, between tasks, between functions, and between units; these are the problems to be targeted first for change. 2. Organization serve multiple Stakeholders. Multiple Stakeholder Perspective (MSP): Stakeholders are individuals or groups who lay legitimate claim to the performance of the organization. An MSP argues that stakeholders should be seen as citizens of the organization and their concerns and interests must be addressed. Theory into Practice: If leaders are successful at aligning the interests of multiple stakeholdersâ€”shareholders, employees, customers, suppliers, the host community and so forthâ€”they can contribute to outstanding performance open communications May 2014 Updated 5/12/14 California InterContinental University | 16 of 83 3. Open Communications Perspective: Deal with Conflict through problem-solving, openness and trust. Conflict must be approached with an attitude of problem solving, openness and trust. Also, try to create a sense of ownership and inclusion. Theory into Practice: Donâ€™t shy away from conflict. As individuals articulate and analyze differences, they can improve organizational effectiveness. Theory into Practice: Be sure to create an inclusive change processâ€”one that builds ownership of and commitment to the desired improvements. Ask yourself: Which of the three perspectives appeals to you most for as a means for implementing change? Process-Driven Change Interventions Change interventions can be content-driven or process-driven. The text documents characteristics of b both methods and argues in favor of the strengths of process-driven change. Across the past three decades content-driven change has received organizational attention. This is the programmatic change in which specific programs customer relationship management (CRM), balanced scorecard, and lean enterprise for example are used as the driver and centerpiece of implementation. An alternative methodology of implementation is process-driven change. This is an approach to change implementation that emphasizes the methods of conceiving, introducing and institutionalizing new behaviors and uses content as a reinforce rather than a driver of new behaviors. Content-driven changes are very popular in organizations because they are quick, simple and trendy but they are rarely successful because they do not build motivation for change. As shown Exhibit 2-4 Characteristics of Change Programs on Page 35, content-driven change effort have five common characteristics: 1. Serve as the initial centerpiece for launching and driving transformation throughout the company or unit. 2. Are imposed by top management 3. Do not proceed from shared diagnosis. 4. Rely on standardized, off-the-shelf solutions. 5. Are imposed uniformly across the organization Theory into Practice: ? There are no one-size-fits-all solutions to performance problems in your organization. ? Just because top leaders believe in the need for change doesnâ€™t mean that that conclusion.
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