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Chapter 14. High-Performing Systems and the Learning Organization. Learning Objectives. Recognize how learning organization approaches are used in OD change programs. Identify several basic OD intervention techniques. Experience and practice system approaches.
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Chapter 14 High-Performing Systems and the Learning Organization An Experiential Approach to Organization Development 7th edition
Learning Objectives • Recognize how learning organization approaches are used in OD change programs. • Identify several basic OD intervention techniques. • Experience and practice system approaches. An Experiential Approach to Organization Development 7th edition
Cisco Tames Its Cowboy Culture(part 1 of 3) CEO Chambers initiated massive change at Cisco. Revolutionary change was company’s only chance. Cisco examined every part including operations, priorities, and culture. An Experiential Approach to Organization Development 7th edition
Cisco Tames Its Cowboy Culture(part 2 of 3) Before changes Cisco was described as wild west cowboy culture. Executives encouraged to compete with one another. Ideas were pursued with little discipline or accountability. An Experiential Approach to Organization Development 7th edition
Cisco Tames Its Cowboy Culture(part 3 of 3) Market changed where customer expected Cisco to be integrated company. Cisco made changes once and deep. Chambers articulated changes, explained the vision, and explained why changes necessary. An Experiential Approach to Organization Development 7th edition
System-Wide Interventions Certain OD interventions aimed at change within total system. OD is systems approach to group, functional, and interpersonal relations. An Experiential Approach to Organization Development 7th edition
System Interventions Examine: • Organization design. • Organization flow patterns. • Interactions of individuals and groups. A system may be organization or subsystem within total organization. An Experiential Approach to Organization Development 7th edition
Survey Research and Feedback Employee attitude surveys serve two important functions: • Improvement tool. • Communication tool. An Experiential Approach to Organization Development 7th edition
Steps in Survey Feedback Step 1 - Top management plans survey. Step 2 - Outside staff gives questionnaire. Step 3 - Outside staff summarizes data and gives feedback to organization. Step 4 - Work group diagnoses problems and develops action programs. An Experiential Approach to Organization Development 7th edition
Results of Survey Research and Feedback Indicate positive changes in employee attitudes and perceptions. Greater involvement of all members produces greater change. Feedback given with other interventions, results in more substantial change. An Experiential Approach to Organization Development 7th edition
Learning Organization (part 1 of 2) System-wide change program. Emphasizes reduction of organizational layers and involvement of all employees. An Experiential Approach to Organization Development 7th edition
Learning Organization (part 2 of 2) Continuous self-directed learning that leads to positive change in individual, team, and organization. A learning organization has developed continuing capacity to adapt and change. An Experiential Approach to Organization Development 7th edition
Approach to Learning Organization Brings together key members in collaborative process to discover problems. Then develops a model of new system. Continuous testing of experience and transformation into knowledge accessible to whole organization. An Experiential Approach to Organization Development 7th edition
Our Changing World: Cement Not Low-tech at Lafarge? (part 1 of 3) Lafarge world’s biggest cement producer. Culture traced to its origins in 1833. The founders were committed to a form of humanism that still prevails in company today. An Experiential Approach to Organization Development 7th edition
Our Changing World (part 2 of 3) Participative management philosophy includes: • Key for managers to develop their people. • Employees share and seek experiences of others. • Dealing with conflict integral to teamwork. • Teamwork creates environment of trust. An Experiential Approach to Organization Development 7th edition
Our Changing World (part 3 of 3) Important element is training. Managers required to monitor development of employees. Lafarge practices intensive communication so that its worldwide businesses understand operations. An Experiential Approach to Organization Development 7th edition
Core Values of Learning Organizations (part 1 of 2) Value different kinds of knowledge and learning. Encourage communication between people with different perspectives. Develop creative thinking. Remain nonjudgmental of others and their ideas. An Experiential Approach to Organization Development 7th edition
Core Values of Learning Organizations (part 2 of 2) Break down traditional barriers in organization. Develop leadership throughout organization. Reduce distinctions between organization members. Every member of organization has untapped human potential. An Experiential Approach to Organization Development 7th edition
Characteristics of Learning Organizations Constant readiness. Continuous planning. Improvised implementation. Action learning. An Experiential Approach to Organization Development 7th edition
Reengineering: a Radical Redesign Radical redesign of business processes to obtain drastic improvements in performance. Seeks to make all processes more efficient to gain quantum leap in performance. Emphasizes products, customer satisfaction, and improvement in processes. An Experiential Approach to Organization Development 7th edition
Steps in Reengineering Process: • Identify key business process. • Identify performance measures. • Reengineer the process, organize work around process, not functions. • Implement redesign process and continuing reevaluation. An Experiential Approach to Organization Development 7th edition
System 4 Management Likert developed System 4 management model based on his research of organizations. It describes organizations on a continuum: • Bureaucratic organizations (ineffective) at one end. • Participative (effective) at the other. An Experiential Approach to Organization Development 7th edition
The Four Management Systems • System 1 - Exploitive/Authoritative (autocratic, top-down). • System 2- Exploitive/Authoritative (top-down/less coercive-autocratic). • System 3 – Consultative. • System 4– Participative. An Experiential Approach to Organization Development 7th edition
Implications to OD System 1 organizations tend to be least effective, system 4 tend to be most effective. OD practitioner tries to move from system 1 organization to system 4 organization. An Experiential Approach to Organization Development 7th edition
Figure 14.1Profile of Organization Characteristics An Experiential Approach to Organization Development 7th edition
Common Elements in System 4 Organizations Action rather than further analysis. Decisions involving subordinates, not superiors. Individual accountability, not rigid policies. Specific recognition of team and individual accomplishments, not blanket expressions of thanks. An Experiential Approach to Organization Development 7th edition
High-Performing Systems (HPS) HPS calls for removal of excessive layers of organization. HPS creates climate of participation and communication across functional barriers. HPS is term originated by Peter Vaill. An Experiential Approach to Organization Development 7th edition
Eight Criteria Used to Examine HPS(part 1 of 2) • Perform excellently against external standard. • Perform excellently against potential. • Perform excellently to some earlier point. • Perform with significantly fewer resources than assumed are needed. An Experiential Approach to Organization Development 7th edition
Eight Criteria Used to Examine HPS(part 2 of 2) • Doing substantially better than other systems. • Perceived as source of ideas for others. • Perceived to fulfill high level for culture within which it exists. • Only organization that is able to do what it does. An Experiential Approach to Organization Development 7th edition
Characteristics of HPS (part 1 of 2) An HPS knows why it exists. Commitment to purposes always high. Teamwork focused on task. Leadership is strong and clear. An Experiential Approach to Organization Development 7th edition
Characteristics of HPS (part 2 of 2) An HPS is fertile source of new methods. Strong consciousness that “we are different.” Other subsystems often see HPS as problem because HPS produces its own standards. HPS is cohesive unit. An Experiential Approach to Organization Development 7th edition
Grid OD Program Grid OD is systematic approach to achieve corporate excellence by changing basic culture of system. Starts with focus on managerial styles. Moves through phases involving the work team and culture of organization. An Experiential Approach to Organization Development 7th edition
Six Grid Phases (part 1 of 3) Phase 1: Grid seminars. Someone in management position attends seminar. Phase 2: Teamwork development. Begins with top manager and continues through entire organization. An Experiential Approach to Organization Development 7th edition
Six Grid Phases (part 2 of 3) Phase 3: Intergroup development. Sessions attended by key members of 2 segments where barriers exist. Phase 4: Development of ideal strategic model. Provides skills to move to systematic development. An Experiential Approach to Organization Development 7th edition
Six Grid Phases (part 3 of 3) Phase 5: Implement ideal strategic model. Organization divided into planning teams and model is implemented. Phase 6: Systematic examination of progress toward change goals. An Experiential Approach to Organization Development 7th edition
Third Wave Organization Term originated by business futurist Alvin Toffler. Describes organizations that are evolving in information age to meet changing times. An Experiential Approach to Organization Development 7th edition
Characteristics of Third-Wave Organization Flexibility - structure has no permanence. Creativity- people motivated by commitment to vision or cause. Innovation - support for risk taking and innovation. An Experiential Approach to Organization Development 7th edition
OD in Practice: Spooks, CIA, and Change (part 1 of 3) CIA budgets slashed by Congress. Morale plummeted. Little or no articulated mission. George Tenet (now retired) took over as director in 1996. An Experiential Approach to Organization Development 7th edition
OD in Practice (part 2 of 3) Tenet’s first priority was to rebuild spy shop. June 2001 CIA began significant reorganization. Transformation included setting up new departments whose heads sat in on the executive board meetings. An Experiential Approach to Organization Development 7th edition
OD in Practice (part 3 of 3) Communication flows were radically changed. For some organizations a crisis can be only way significant change can occur. Tenet said it would take 5 years to produce clandestine service U.S. needs. An Experiential Approach to Organization Development 7th edition
Key Words and Concepts • Grid OD - defines problem areas for OD by going through phases designed to pursue systematic change. • Grid phases - six phases that a typical Grid OD program goes through. An Experiential Approach to Organization Development 7th edition
High-performing system (HPS) - removal of excessive layers of structure within the organization. Encourages participation across barriers. • Learning organization - continuing capacity to adapt and change. An Experiential Approach to Organization Development 7th edition
Ideal strategic model - Phase 4 of Grid OD program. Model developed to achieve excellence. • Reengineering - radical redesigning of processes to achieve drastic improvements in performance. An Experiential Approach to Organization Development 7th edition
Survey research and feedback - collect data and give feedback to allow organizations to diagnose problems. • System 4 management - a continuum from system 1 to system 4, with 4 being ideal that organizations attempt to achieve. An Experiential Approach to Organization Development 7th edition
System-level organization - a structural design framework for viewing organization. • Third-wave organization - firms that use flexibility, creativity, and innovation to be successful in information age. An Experiential Approach to Organization Development 7th edition
Preparations for Next Chapter • Read Chapter 15. • Complete Step 1 of OD Skills Simulation 15.1. • Read and analyze Case: The Space Electronics Corporation. An Experiential Approach to Organization Development 7th edition