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UNIT II

ORGANISATIONAL DEVELOPMENT & CHANGES

Organizational Development:

Organizations are collectives of people that have been established for the purpose of

Relatively specific objectives on a more or less continuous basis. W.R. ScottOrganizations can be used in the following sense:

1. as an entity2. as a group of people3. as a structure4. As a process.

There are 4 characteristics of an organization:-

- Communication- Cooperative effort- Common objectives- Rules and regulations.

Organizations are defined as collectives that have been established for the pursuitsof relatively specific objectives on a more or less continuous basis. W.R. Scott The

emphasis is on;

- Planning- Organizing- Leading- Controlling

Planning: It is a process that includes defining goals, establishing strategies

and developing plans to coordinate activities.

Organizing: This is the activity of determining what tasks are to be done, who

is to do them. How the tasks are to be grouped, who reports to whom andwhere decisions are to be made.

Leading: Leading is a function that includes motivating, directing others,

selecting the most effective channels and resolving conflicts.

Controlling: Monitoring activities to ensure that they are being accomplished

as planned and are being corrected when there is any significant deviation.

FEATURES OF AN ORGANISATION:

1. Identifiable aggregation: of human beings. Identification is not possible becauseorganization does not merely mean a number of persons collected at random. It

refers to a group of persons who are inter-related. Even though all individuals donot know each other personally, as in large organizations, it is a distinct entity

which has a definite boundary.2. Deliberate and Conscious creation: It is a consciously created human group. It is

a contractual relationship. Members enter the organization through contracts and

can also be

3.4. Re [placed. That is, unsatisfactory persons can be removed. As such,

organizations continue much longer than its members. This is the difference

between organizations, mobs and families. Though families also have social unity,

like planning (family budget), power centre (father), replaceable members

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(divorce) etc., the extent of adhesion is much less than in an organization. Egg: -companies, armies, hospitals, schools, etc.

5. Purposive creation: All organizations have objectives or sets of objectives. Theobjectives are mutually agreed upon by the members of the group. An

organizational objective is a desired state of affairs which the organization

attempts to realize. Organizes are required to achieve organizational goals. The

success or failure of an organization is measured in terms of achievements of itsobjectives.

6. Co-ordination of activities : There has to be co-ordination of closely relatedactivities. Co-ordination is necessary because all the members work together to

achieve the organizational goal or goals. The objective of co-ordination is to direct

all efforts towards the attainment of organizational goals. There has to be some

means of controlling, guiding and timing; which in turn, means an authority and

hierarchy. The objective is co-ordination of activities and not individuals. The

same individual may belong to different organizations, but his activities in a

particular organization are limited.

7. Structure: Each member of an organization has a particular place in which he isfitted. There has to be a hierarchy in which power and responsibility is well

defined. This helps in discipline, controlling and co-ordination.8. Rationality: Every organization has some specific norms and standard of

behavior. Every member is expected to behave in accordance to those norms. Thebehavior is ruled by reward and penalty system. Desirable behavior is rewarded

and undesirable behavior is punished.

TYPES OF ORGANISATIONS:

Organizations can be classified in various ways;

1. Small, medium, large, giant2. Public, private, mixed (Ownership)3. Sole trader, partnership, join-stock company, corporation4. and co-operative society (legal status)

FEATURES OF OD1. Planned change: OD is a strategy planned change for organizational improvement.2. Comprehensive change: Whenever there is a change, it has to be a comprehensive

change so that corresponding changes that are required for the effective working of

the organist ion is made simultaneously.

3. Long-Range Change: OD focuses on changes that are required for the long termimprovement of the organization. These changes are required for the elevation of thestandard of the organization. Hence these changes are long range changes.

4. Dynamic Process: Just as organization growth and goals change in accordance withthe environmental needs, the process of development in the organization is also

dynamic. These changes are ongoing, cyclic and interactive.

5.

Participation of change agent: Most organization prefer to have an outside agent todo the change and developmental work. Being an outsider, they are able to see thingsobjectively, in their proper perspectives.

6. Emphasis on intervention and action research: Before any change is incorporated,thorough surveys are conducted and analyses made. Relevant data is collected and

interpreted. Strategies are formulated on the basis of these studies.

7. Normative Educational Processes: OD is based on the principle that norms form thebasis for behavior and change is a re-educative process.

ROLE OF OD:

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OD is a long term strategy for organizational change made for the improvement of theorganization. OD can be used for the following purposes;

1. To place emphasis on human values and goals consistent with these values.2. To treat each human being as a complex person with a complex set of needs

which are important in his life and work.

3. To increase the level of trust and mutual emotional support among allorganizational members.

4. To increase the level of group and self responsibility a planning and itsimplementation.

5. To increase the openness of communication in all directions vertically,horizontally and laterally.

6. To increase the level of enthusiasm and personal satisfaction at all levels of theorganization.

7. To create an environment in which authority of assigned roles is augmented byauthority based on knowledge and skills.

PROCESS OF OD:OD can be taken as a process of changing people and other related aspects of an organization.

It consists of many steps or processes and sub-processes. Uniformity in the steps involved isnot [possible because each organization has its own kind of practice. Different practitioners

have envisaged different steps.Blake & Mouton:

- Studying the managerial grid- Studying the actual dynamics of the work team- Launching similar activities in different units.- Transforming the organization as per the model- Measurement of change.

R. Beck hard - diagnosis

- Strategy planning- Education

- Consulting & Training

- EvaluatingFrench & Bell - Diagnosis

- Action- Process maintenance.

Process:1. Problem Identification & Diagnosis: OD attempts to solve some organizational.

The problem may be a gap between the desired and actual plans of action. ODprogrammed starts with the identification of the problem in the organization. Causes

of the problem are identified and analyzed. Diagnosis is made and causes pinpointed.The variables that can be altered or changed are identified.

2. Planning strategy for Change: When the problems are diagnosed, the ODpractitioner plans various course of action for the desirable change. They may alsoconsult the management. The way in which a change is planned has an impact on the

way in which it is carried out. Similarly, the problems of implementing change have

an impact in the way in which it is planned.

3. Intervening in the system: Intervening refers to the planned programmed activitiesduring the course of an OD programmed. These planned programmes bring certain

changes in the system. This is the basis objective of OD. This may be done through

education. Laboratory training, process consultation, team development, etc.

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4. E l i The results of OD are then evaluated so that suitable ac5ions may befollowed up. Since OD is a long process, there is an urgent need for careful

monitoring to get precise feedback regarding whatis going on.

Acti ch Model of OD:The OD process can be conveniently presented in the form of an action research model. OD

puts emphasis on the process of problem solving, and trains the participants to identify andsolve problems that are importantto them. Forthis purpose, the various steps of OD problem

identification and diagnosis are undertaken. This cyclic process of using research to guideaction generates new data as the basis for new actions; this is known as action research.

French and Bell have defined action research as follows;

Action research the process of systematically collecting research data

about an ongoing system relati e to some objecti e, goal or need of that

system: feeding those data back into the system; taking actions by

altering selected variables within the system based on the data and

hypothesis; and evaluating the results of actions by collecting more

data.Various activities may be presented as below;

Action research model of OD

The above model involves data collection, and diagnosis, providing feedback toclients and discussion and determination of action at various stages. Action research is

the basis for designing strategies of OD. It is especially important in the followinginstances;

Organisationalperceptionsof

problems

Furtherdata

collectionby

consultants

Reassesment

ofsituation

throughfurther data

collection

Datacollection

and diagnoisby

consultanton

the problems

Feedbackanddiscussionwith

clienttowork

onthe

problems

Feedbacktoclientand discussionto

workonthefeedbacks

Feedbacktothe

clientaboutthe

nature and causesofthe problems

Determinationofobjectivesand plan

ofaction

New planofaction

Jointactionplanningfor

solvingthe

problems

Determination

ofaction

behaviourforachievingthese

objectives

Action

Behaviour

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1. It involves all those who take action or who are affected by change in theorganization. Therefore, it is most probable that changes will be willingly

accepted.2. It helps the members of an organization to work together effectively and develop

positive attitudes towards changes.

3. It rationalizes the action by providing accurate knowledge of the context n whichit occurs.

OD Intervention:This refers to the various activities which a consultant and client organization perform to

improve organizational performance through enabling organizational members better their

behavior, their work group and organizational culture. French and Bell have defined OD as;

Set of structured activities in which selected organizational units (target

groups or individuals) engage with a task or a sequence of tasks where the task

goals are related directly or indirectly to organizational improvement.

Intervention constitutes the action thrust of organizational development. Theymake things happen.

There are varied OD interventions and they are classified in various ways. Different

consultants believe differently about what should constitute intervention practice. Thereforethere are different methods and practices. A meaningful classification of OD may be based on

the improvement of behavior among the members of an organization. Interventions may berequired to change people at all levels. Some of the techniques of intervention are as follows;

1. Sensitivity Training.2. Grid Training3. Survey Feedback4. Process Consultation5. Team Building6. Management by Objectives.

SURVEY FEEDBACK:This process includes survey research and feedback of data. The Institute of Social Research

(ISR), Michigan, USA, developed a comprehensive questionnaire for conducting survey of

different aspects of the organization. Feedback is taken on the basis of the following points;

1. To assist the organization to diagnose its problems and to develop action plansto help it solve those problems.

2. To assist the group members to improve relationships through interaction anddiscussion of common problems.

Process of Survey Feedback:

1. Data Collection: The first step is the collection of relevant data, usually by aconsultant based or structured questionnaire. The questionnaire may include differentaspects of organizational functioning. ISR has prepared a questionnaire whichincludes questions on leadership, managerial support, managerial goal emphasis,

managerial work facilitation, peer support, peer emphasis, peer work facilitation and

peer integration facilitation. It also includes questions on organizational climate

communication with the company, motivation, decision making, control within the

company, coordination between departments and general management, satisfaction

with the company, satisfaction with the supervisor, with the job, with the pay, with the

work group etc. The questionnaires are administered personally. After the

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questionnaires are filled, data is classified, tabulated and analyzed to arrive at somemeaningful conclusions.

2. Feedback of information: After the data is analyzed, feedback is given to the persons who have filled in the questionnaires. Feedback may be given in group

discussions or problem solving sessions conducted by the consultants. Otherwise,

feedback may be given in written form in the form of a summary of the feedback. The

feedback should be constructive and suggestive rather than threatening and emotionhurting.

3. Follow-up Action: Follow-up action is then taken. Either the participants are advisedto develop their own programmes for development, based on the feedback given or

some specific OD programmed may be developed.

Evaluation of Survey Feedback:

1. It is the cost-effective means of implementing a comprehensive ODprogrammed that makes it a highly desirable technique.

2. It generates a great deal of information effectively and quickly. This can be usedfor solving many problems being faced by the organization.

3. Because the method collects the information of knowledge from all angles anddepartments of the organization, many new and valuable ideas are obtained.

However, effectiveness f the Survey Feedback system depends on reliability of the

questionnaire used and the method adopted for its administration. If it is biased, it will become ineffective. Even if reliable and valuable information is collected, it is of no use

unless follow-up action is taken based on the information. This is not a technique for changein itself. It provides a base for action for change.

TEAM BUILDING:

Amongst the various processes of OD, perhaps team building is the most effective. French

and Bell have said

Probably the most important group of interventions in OD is the team building

activities within the organization.

This is so because the people in the organization ultimately determine organizational

effectiveness.

Life-Cycle of a Team:Individuals working in an organization generally pass through several stages as they learn to

work together as a team. These stages are forming, storming, forming, performing and

adjourning.

1. Forming: Team members get introduced to each other. They share personalinformation, start to accept each other and begin to turn their attention to group

tasks. Members are new to each other and the interaction is limited andcautious.

2. Storming: Members start interacting with each other. They start vying witheach other for status, leadership and control. They argue for appropriatestrategies to be adopted to achieve the teams goals. Members may experiencevarying degrees of tension and anxiety.

3. Forming: The team members start settling down. A balance in relationship isstruck and the team members begin to co-operate with each other. Group norms

emerge to guide individual behavior. Co-operative feelings emerge in the group.

4. Performing: When team members start interacting with each other on thebasis of group norms, they start handling complex problems that come before

the team. Functional roles are exchanged and tasks are completed efficiently.

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5. Adjourning: Adjourning is the end phase of the life cycle of a team. When themission is completed, the team has to be adjourned.

Synergy in Teamwork:Synergy is the process of putting two or more elements together to achieve a sum total greater

than the sum total of individual elements separately. This is especially important in teambuilding.

Synergistic effect is not automatic. It depends on the cooperation and adjustment of two or

more elements that are put together and the way they interact among themselves. This means

that members of a team are complementary to each other and they contribute positively to

one another. In fact, a team is created to attain the skills that a single individual cannot

perform.

Social Loafing:Social loafing is just the opposite of synergy in teamwork. Working together on a common

task may actually decreases the individual efforts. Teamwork does not necessarily enhancegroup effort. This is especially clear when a group of students are assigned to a particular

group assignment. Some students take initiative and do a great deal of work while some donot take any interest. They rely on the fact that more reliable members will complete the task.

The probability of social loafing in teamwork increases because of the following factors;1. When the division of work cannot be accomplished properly and individual

efforts are hard to determine.2. When the group is not cohesive with high output norms, individual members do

not contribute to the fullest.

The effect of social loafing can be minimized by constituting proper and meaningful teams

for group performance.

Effective Team:

An effective team is one which contributes to the achievement of organizational objectives by

performing the task assigned to it and providing satisfaction to its members. The factors that

affect effective team are;

1. Skill and role clarity: Knowledge of skills which are complementary to the teamrequirement and understanding of ones own role as well as of other members. While

skills are important and relevant for job performance, understanding of roles help

members to meet the requirements of one another.

2. Supportive Environment: Even a highly skilled team cannot perform well iforganizational climate is not supportive for that. Managers at higher levels should set

organizational climate and culture which enthuses members to put in their best.

3. Super ordinate4. Goals: These are goals which are above those of a single group or individual. An

individual work better if is able to link how5. Goal attainment leads to the attainment of higher level goals.6. Tam Rewards: Team performance depends on how reward is linked to team

performance and how members perceive this linkage. If performance is linked with

rewards in their careers, members will put in their maximum efforts. Rewards of both

types, financial as well as non-financial, should be taken into consideration.

Real teams can be sustained by the following;

1. Selecting members for their complementary skills and potential.2. Developing clear rules of conduct and

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3. Challenging performance goals.4. Establishing a sense of urgency right from the start.5. Providing substantial time together in which new information is constantly

shared

6. Providing positive feedback7. , recognition and rewards.

TEAM BUILDING PROCESS:

1. Setting goals and priorities for the team.2. Analyzing how team goal and priorities are linked to those of the organization.3. Analyzing how the work is performed.4. Analyzing how he team is working.5. Analyzing the relationships among the members of the team.

The process is as follows;

----------------------------------------------------------------------------------------------------

Process of Team building

Problem Sensing: There are a number of ways in which the problems of a team can b

identified. It can be best identified in terms of what is hindering group work. Members of the

group should come out with what they think is the problem in the group. The views maybe

quite different. A consensus is arrived at regarding the problem being faced by the group.

Examining Differences:Perception on the issue of problem differs because of the difference

in the background of the members. The issues are discussed thoroughly and the actual

problem is found out.

Giving and Receiving Feedback: The points should be discussed thoroughly and feedback

given to each member so that he is able to understand the problem thoroughly.

Developing Interactive skills: The basic objective of this process is to increase the ability

among the members to know how to interact with others and to engage in constructivebehavior.

Follow-up Action: At this stage, the total team comes together to review what has been

learned and to identify what the next step should be. This also helps to overcome the

drawbacks involved in the initial stages of team building. It helps to clarify and settledifferences in a positive manner.

EVALUATION OF TEAM BUILDING:Tea building contributes to the organizational performance in the following manner;

1. It improves the organizations problem solving and decision making ability.2. It helps in developing effective interpersonal relationship.3. It helps to develop meaningful communication within the group and with the

groups.

Proble

sens

ng

Examine

perceptual

differences

Giving &

receiving

feedbac

Developing

interactives ills

Follow up

action

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However, team building has been termed as a one sided effort and it suffers from thefollowing limitations;

1. It focuses only on work groups and other organizational variables such astechnology, structure, are not given much importance.

2. It becomes complicated when there are frequent changes in work groups or teams. New members may find it difficult to adjust with the team because of hisconfusion over his role in terms of task performance and building good

relationships.

Inspire of these problems, team building has a positive outlook. There have been attempts to

combine team building with organizational building approach models. One such suggestion is

to be to use a task hierarchy to reinforce the team as it progresses.

Organizational Change:

Change is necessary. Without it, organizations can neither develop, grow nor survive in this

ever changing environment. There are many kinds of changes around us. There arebiological, social, human behavior, environment changes and many more. It is for managers

to determine how to manage changes for the maximum effectiveness in an organisation.

Observation of Arum Bharat Ram, Senior Manager of SRF Limited.

Around 25-30 percent of the existing companies might be forced to top

operations in the country in the next 2-3 years. This trend is likely to take place becauseof the increasing change in the Indian economy only those who have capacity to

compete and survive would emerge and take the place of the ole ones.

Nature of organisation:The term change refers to an alteration in an organsation, whether physical, social or

biological. Organizational change has the following features;

1. When change occurs in any part of the organisation, it disturbs the oldequilibrium. This makes it necessary for the development of a new equilibrium.

The type of new equilibrium depends upon the degree of change and its impact on

the organisation.

2. Any change in the organisation will affect the entire organisation. Some parts maybe affected more and other less. Some may be directly affected, while others may

be affected indirectly.3. Organizational change is a continuous process. While some changes are so small

that they go unnoticed, others are so huge that they require outside help.

New storm and Davis have explained organizational change with an air-dilled balloon. When

there is some pressure applied from the outside of a filled balloon, there is some change in theshape of the balloon at the point of indention. But if we look minutely, we find that the entireballoon has changed. It has stretched slightly. Thus we can say that the whole organisation is

affected when there is even a slight change in the organisation.

Factors in Organizational Change:

External Factors:Every organisation exists in an environment where there are other organizations. Each

organisation interacts with other organizations. Each organisation has duties and roles that are

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related to other organizations. Therefore, an organisation must not only look after itsrequirements, it also has to take into consideration the goals of other establishments. There

are various factors;1. Technological changes: Organizations keep on changing technology to meet new

and better requirements. When an organisation adopts a new technology the

entire organization is affected and a new equilibrium has to be created.

2. Changes in Marketing Conditions: Since every organisation has to export itsend product to the market. It has to take into consideration the market forces and

adopt itself accordingly. The organisation is affected by two kinds of external

forces; one, other organizations producing the same thing and two, by the

customers themselves. Any change in these two forces would require a suitable

change in the organisation.

3. Social Change: Social changes reflect the changes in peoples aspirations, needs,and way of working. Social changes also take place because of changes in levels

of education, urbanization, feeling and autonomy, international impact, etc.

4. Political and Legal Changes: These factors broadly define the activities whichan organisation can undertake and the methods which will be followed by it forattaining their goals and set activities. Any change in these activities may change

the organizational operations.

Internal Factors:1. Change in managerial personnel: There is often a change in managerial

personnel. Old managers may retire, be promoted, get transferred or be dismissed.Each new manager brings his own way of working. The relationships, particularly

the informal ones change. Attitudes change. Result is that an organisation has to

change accordingly.

2. Deficiency in Existing Organisation: Sometimes changes are necessary becauseof some deficiency in the existing organisation or its arrangement or process.

They may be in the form of unmanageable span of management, large number of

managerial levels, obstacles in communication, multiplicity of committees,

overlapping of work, etc.

Chain Effect of Change:Sometimes, it will be seen that one change sparks off or sets off a chain of changes. In order

to achieve a new equilibrium, the organisation has to modify the existing equilibrium. Thus

all the systems are related. It may so happen that new technology is incorporated in the

working system. Because of this change, there may be a total change in the job specificationsand evaluations, time of working may be changed. Skills required for operating the new

technology may change, etc.

Reactive and Proactive change:

A reactive change is undertaken when an organisation is forced to make some changes as inthe case of anti-pollution processes.

A proactive change is that change which is brought about by the organisation in anticipation

of what is likely to take place. These organizations constantly react with the environment to

find out what is new and what might be the future course of action.

Planned Change: Every organisation knows that without change, there can be no growth or

survival. Therefore, it is necessary for every organisation to plan changes. This change has to

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be done in a planned manner, especially in the case of difficult and challenging changes. It isthe deliberate design and implementation of a structural innovation.

Factors in planned change

Technology related changes: Technology relates to the sum total of knowledge providing

ways to do things. This may include inventions and techniques. They may include;1. Changing problem-solving and decision making procedures.2. Introduction of automated data processing devices like computers to aid in

management decision process.

3. Change in the unit of production like, unit production to mass production systems.Task-related Changes: Technology related change determine the type of task that may berequired to complete an operation. Task related changes must focus on;

1. High internal work motivation2. High quality work performance.

Structure Related Change: This kind of change redefines interrelationship between

departments, companies, people etc. They change

1. Chang the number of hierarchical levels2. Change one form of organisation to another.3. Change span of management.4. Chang line-staff and function authority.

People Related Changes: There may b changes in people in the form of skill and behavior.

This may involve change in style of work and techniques. There are also techniques of

bringing in new forms of human behavior which will add to the efficiency of theorganisation.

OBJECTIVES OF PLANNED CHANGE:

1. Environmental adaptation: The environment is dynamic. Nothing in it is static.Therefore, organizations need to change to adapt to the environment and also to keepup with the latest requirements. When there is a change in the environment there is achange in the equilibrium of the organisation. Therefore the organisation has to

change and adapt itself to bring back equilibrium.

2. Individual Adaptation: Whenever an organisation changes to maintain equilibrium,it has to make changes in the organizational structure, technology and task. People

have to change themselves so that they can cope with the changed requirements and

circumstances.

Structure

Tec nology Tas

People

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3. Structural Adaptation: Organizational structure is the pattern of relationship between different organizations and departments and the various positions held

therein. Many a times organizational structure changes also have to be made toincorporate fresh authority and ideas

4. Technical Adaptation: With new and improved methodology, there has to be changein technology so that revised needs can be met.

5. Task Adaptation: Technological changes are likely to bring bout many changes.Tasks will also have to be changed to meet the new requirements.

PROCES OF PLANNED CHANGE:

Management of organizational change is a complex task and process. It cannot be done

instantaneously. It has to be planned. It includes considerable planning. If the change is done

in a planned manner, there will be great success.

Feedback

Process of Planned Change

The various steps in planned change are

1. Identifying need for change2. Elements to be changed3. Planning for change4. Assessing change forces5. Change Actions6. Feedback.

Unfreezing: Unfreezing is the process of in which a person casts aside his old behavior

which might be inappropriate, irrelevant, or inadequate. The following steps are taken tounfreeze.

1. Physical removal of individuals being changed to improve performance results.2. Undermining and destruction of social support.3. Demeaning and humiliating experiences to help individuals to see their old

attitudes or behavior as unworthy.4. The consisting linking of reward with willingness to change and of punishmentwith unwillingness to change.

Refreezing: This means that what has been learned is integrated into actual practice. At this

stage the individuals internalize the new beliefs, feelings and behaviors learned during the

changing phase. They adopt these elements as a permanent part of their behavior repertoire.

Identifyingneed

forc an e

Elements to

bec an ed

Planning

forc an e

Assessing

c an e forces

Action for

c an e

Unfreezing

Changing

Refreezing

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Often there is a tendency for people to revert back to their old behavior which they weredoing before the change had been implemented. This can be stopped if some reinforcement is

placed along with the change.

Response to Change:1. Willing acceptance2. Resistance3. Forced Acceptance4. Rejection

RESISTANCE TO CHANGE:During the management of change, managers face resistance to change. People tend to resist

changes because of homeostasis which means that organisms do self correction to maintain

equilibrium as a result of change. As a result of change, people act to establish a steady state

of need fulfillment and to secure themselves from disturbance of that equilibrium. When the

change is major or unusual, people often resist the change. Fear of change often spoils the

change itself.

Resistance as a cost.Just as change attracts additional cost, resistance to change also attracts cost. If an

organisation is not able to affect changes in due course, it may become costly, and may evenlead to the obsoleteness of the organisation.

Resistance as a benefit:When there is a resistance to change, it forces the change agents to weigh the pros and cons

more carefully. While making a change, people look to only the positive side. Resistance

makes people look into the negative aspects also. Resistance helps management in two ways;

1. It may signal the need for more effective communication about the meaning andpurpose of the change.

2. It also highlights real inadequacies.Factor in resistance to change:

1. Individual Factors

2. Economic Factors

3. Psychological factors

4. Social Factors.

Overcoming Resistance to Change:1. Involvement2. Obtaining Commitment3. Leadership4. Training and Psychological counseling5.

Group

Contact6. Participation

7. Group Dynamism.