Chapter 7
Managing Change:
Innovation
and Diversity
PowerPoint Presentation by Charlie Cook
The University of West Alabama
Copyright © 2006 Thomson Business and Economics.
All rights reserved.
Learning Outcomes
After studying this chapter, you should be able to:
1. Identify the sources of forces for change.
2. List the four types of change.
3. List the reasons people resist change, and suggest ways of
overcoming such resistance.
4. State the difference between a fact, a belief, and a value.
5. Explain intrapreneurship, and identify its three roles.
6. Discuss the relationship among diversity, innovation, and quality.
7. Explain the difference between team building and process
consultation.
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7–2
Learning Outcomes (cont’d)
8. State the difference in the use of forcefield analysis and survey
feedback.
9. Define the following key terms:
types of change
information systems (IS)
stages of the change process
organizational development
(OD)
OD interventions
team building
process consultation
forcefield analysis
survey feedback
large-group intervention
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7–3
Ideas on Management at Hewlett-Packard
1. How did Fiorina reorganize HP, and in what ways did
she change its competitive strategy? What company
did HP acquire in 2002?
2. How did Fiorina confront resistance to the
acquisition?
3. How is HP committed to innovation?
4. What diversity initiatives has HP undertaken?
5. How does HP use organizational development (OD),
and how does HP assist other firms with OD?
Copyright © 2006 Thomson Business and Economics. All rights reserved.
7–4
Change
•
Forces for Change
–
–
Changes in the business environment creates the
necessity for change in a firm’s strategy which requires
altering the functions and structure of the firm
(technology and people) to support the strategy.
A competitive firm creates an organizational structure
that supports its strategy which, in turn, is constantly
revised to respond to environmental change.
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7–5
Types of Organizational Change
Exhibit 7–1
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7–6
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7–7
Forms of Change
• Incremental Change
– Continual improvement that takes place within
already accepted frameworks, value systems, or
organizational structure that is necessary for
survival and success.
• Radical Change
– Rapid change in strategy, structure, technology,
or people.
– Radical change alters accepted frameworks,
value systems, or organizational structure.
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7–8
Stages in the Change Process
Exhibit 7–2
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7–9
Resistance to Change and Ways to Overcome Resistance
Exhibit 7–3
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7–10
Resistance to Change
• Intensity
– People vary in their attitudes towards
change.
• Sources of Resistance to Change
– Facts
•
Provable statements that identify reality.
– Beliefs
•
Subjective opinions that cannot be proven.
– Values
•
What people believe are important and worth
pursuing or doing.
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7–11
Resistance to Change (cont’d)
• Focuses of Resistance to Change
– Self
•
The reaction of individuals who feel their selfinterests are threatened by change.
– Others
•
The consideration given to how others will be
affected by change.
– Work Environment
•
Change in the working environment threatens
individuals control of the environment.
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7–12
Resistance Matrix
Source: Adapted from Ken Hultman, Resistance Matrix: The Path of Least Resistance (Austin, TX: Learning Concepts, 1979).
Copyright © 2006 Thomson Business and Economics. All rights reserved.
Exhibit 7–4
7–13
Innovation
• Innovative Organizational Structures
–
–
–
–
–
–
–
Flat organizations with limited bureaucracy
Generalist division of labor
Coordinate with cross functional teams
Informal with decentralized authority
Create separate systems for innovative groups
Attract and retain creative employees
Reward innovation and creativity
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7–14
Innovation (cont’d)
• Innovative Organizational Cultures
–
–
–
–
–
–
Encourage risk-taking
Foster intrapreneurship
Have open systems
Focus on ends rather than means
Accept ambiguous and impractical ideas
Tolerate conflict
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7–15
3M’s Rules for an Innovative Culture
•
•
•
•
•
•
Set goals for innovation
Commit to research and development
Inspire intrapreneurship
Facilitate, don’t obstruct
Focus on the customer
Tolerate failure
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7–16
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7–17
Diversity
• Diversity
– The degree of differences among members of a
group or an organization.
•
•
Race/ethnicity, religion, gender, age, ability
Diversity in all forms is increasing in the general
population and the workforce.
– Incorporating diversity opens up a larger labor
pool of skilled workers from which to recruit.
– Diversity is a legal requirement, an ethical
obligation, and a competitive advantage.
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7–18
Diversity (cont’d)
• Valuing Diversity
– Emphasizes training employees of different
races and ethnicities, religions, genders, ages,
and abilities to function together effectively.
• Managing Diversity
– Emphasizes fully utilizing human resources
through organizational actions that meet all
employees’ needs.
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7–19
Managing Diversity
Exhibit 7–5
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7–20
Gender Diversity
• Issues:
– Disappearance of the “traditional family”
– Increase in women as a percentage of the work
force
– Women’s pay continuing to lag behind men’s
– Glass ceiling barring women from upper
management
– Sexual harassment in the workplace
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7–21
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7–22
Organizational Development
• Organizational Development (OD)
– The ongoing planned process of change used
as a means of improving performance through
interventions.
• OD Interventions
– Specific actions taken to implement specific
changes.
• Change Agent
– The person selected by human resources
management to be responsible for the OD
program.
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7–23
Lewin’s
Change Model
Exhibit 7–6
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7–24
OD Interventions and Their Focus
OD Intervention
Individual focus
1. Training and Development
X
2. Sensitivity Training
X
Group focus
3. Team Building
X
4. Process Consultation
X
5. Forcefield Analysis
X
Organization focus
6. Survey Feedback
X
7. Large-Group Intervention
X
8. Work Design
X
X
X
9. Direct Feedback
X
X
X
Exhibit 7–7
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7–25
OD Interventions
• Team Building
• Stages in Team Building
– Designed to help work
groups increase
structural and team
dynamics performance
to get the job done.
• Process Consultation
– Designed to improve
team dynamics by
focusing on how people
interact as they get the
job done.
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– Climate building and
goals
– Evaluation of structure
and team dynamics
– Problem identification
– Problem solving
– Training
– Closure
7–26
OD Interventions (cont’d)
• Forcefield Analysis
– Diagrams the current level of performance, the
forces hindering change, and the driving force
toward change.
• Survey Feedback
– Use of a questionnaire to gather data to use as
the basis for change.
• Large-Group Intervention
– Brings together participants from all parts of the
organization, and key outside stakeholders, to
solve problems or take advantage of
opportunities.
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7–27
Forcefield Analysis
Exhibit 7–9
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7–28
OD Interventions (cont’d)
• Work Design
– Can be designed as an individual job, as a job
for a group to perform, or by
departmentalization.
– Job enrichment is used to change jobs to make
them more interesting and challenging.
• Direct Feedback
– In certain situations, the most efficient
intervention is to have a change agent make a
direct recommendation about a specific change.
– Often such a change agent is an outside
consultant.
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7–29
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7–30