Welcome Back to Organizational Development & Change!

1. Welcome Back to Organizational Development & Change! • Agenda • Organic Design • Bottom Up Change • Case Analysis Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

2. Employee Involvement • Employee involvement seeks to increase members’ input into decisions that affect organization performance and employee well-being. • Employee involvement (EI) is the broad term for diverse approaches to gain greater participation in relevant workplace decisions. Cummings & Worley,9e (c) 2008 South-Western/ Cengage Learning

3. Employee Involvement • Power • Extent to which influence and authority are pushed down into the organization • Information • Extent to which relevant information is shared with members • Knowledge and Skills • Extent to which members have relevant skills and knowledge and opportunities to gain them • Rewards • Extent to which opportunities for internal and external rewards are tied to effectiveness Cummings & Worley,9e (c) 2008 South-Western/ Cengage Learning

4. EI and Productivity Improved Communication and Coordination Improved Productivity Employee Involvement Intervention Improved Motivation Improved Capabilities Cummings & Worley,9e (c) 2008 South-Western/ Cengage Learning

5. Secondary Effects of EI on Productivity Employee Well-being and Satisfaction Attraction and Retention Productivity Employee Involvement Intervention Productivity Cummings & Worley,9e (c) 2008 South-Western/ Cengage Learning

6. Flat, lean organization structures Enriched work designs Open information systems Sophisticated selection and career systems Extensive training programs Advanced reward systems Participatively designed personnel practices Conducive physical layouts High Involvement Organization Features Cummings & Worley,9e (c) 2008 South-Western/ Cengage Learning

7. Work Design Approaches • Engineering: Traditional Jobs & Groups • High specification and routinization • Low task variety and autonomy • Motivational: Enriched Jobs • High task variety and autonomy • Feedback of results • Sociotechnical: Self-Managing Teams • Control over total task • Multi-skilled, flexible, and self-regulating Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

8. Enriched Jobs Critical Psychological States Core Job Characteristics Outcomes Skill variety Task identity Task significance Experienced Meaningfulness of the Work • Hi internal • work motivation • Hi growth • satisfaction • Hi job • satisfaction • Hi work • effectiveness Autonomy Experienced Responsibility Feedback from work Knowledge of Actual Results Moderators Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

9. Designing Work forTechnical and Personal • Technical Factors • Technical interdependence: the extent to which cooperation among workers is required • Technical Uncertainty: the amount of information processing and decision making among workers necessary to do the work • Personal Need Factors • Social Needs: the desire for significant social relationships • Growth Needs: the desire for personal accomplishment, learning, and development. Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

10. Self-Regulating Work Groups Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

11. How to start and sustain a community of practice: • Identify potential communities of practice that will enhance the company’s strategic abilities. • Identify domain of expertise • Provide the infrastructure that will support such communities and enable them to apply their expertise effectively. • IT systems, official sponsors or support teams, rewards • Use non-traditional ways to assess the value of the company’s communities of practice. • Collect stories Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

12. Top-down vs. Bottom-up Tennis Ball Exercise Get into your groups and select a timer and a ball feeder for this exercise… Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

13. IDEO: What they do • IDEO helps companies innovate. They design products, services, environments, and interactions. • “Head in the sky...” IDEO’s teams, culture, and methods are the special ingredients that fuel our approach to innovation and design. • “...feet on the ground.” What’s a good idea worth if it can’t be realized? IDEO’s world-class designers and engineers ensure that the power of the vision is preserved in the journey from concept to final production.

14. IDEO TEAMS Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

15. Conditions that Support Change from the Bottom • When the task is complex and requires insight from organizational members • When the environment is dynamic and changes to products and services are needed • When quality and innovation is at a premium • When organizational members are mindful and engage in constant adaptation.

16. Some weaknesses of approaching change from the bottom up When human capital is lost, performance can decline. Participation by uninformed, unskilled and umotivated workers does not enhance organizational change. It requires an investment of money and time to encourage participation and empowerment. Rhetoric about empowered participation, without action breed cynicism and conformity. Change depends on top management’s willingness to build the skills and knowledge of organizational members.

17. Johnsonville Sausage • The story of one organization’s dramatic transformation • CEO Ralph Stayer has been very directive, involved in most day-to-day decision making • But Stayer is not satisfied with the current organization and seeks to initiate a change • Employees were bored, made dumb mistakes, and didn’t care Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

18. Lincoln Electric vs. Johnsonville Sausage • What are some of the similarities and differences in terms of work environment, work force, leadership, compensation? • How does this affect organizational change at Johnsonville Sausage? Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

19. Johnsonville Sausage • How does change occur at JF? • What is the process for the change? • Who is involved? • Why is this change successful? • Any concerns? Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

20. http://www.mu.edu/differencenetwork/ralph-stayer.php Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

21. Ralph Strayer’s Guide to Improving Performance People want to be great. If they aren’t, it’s because management won’t let them be. Performance begins with each individual’s expectation. Influence what people expect and you influence how people perform. Expectations are driven partly by goals, vision, symbols, semantics, and partly by the context in which people work, that is, by things as compensation systems, production practices, and decision-making structures. The actions of managers shape expectations. Learning is a process, not a goal. Each new insight creates a new layer of potential insights. The organization’s results reflect me and my performance. Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

22. Johnsonville Sausage • The structure and decision-making ability of Johnsonville Sausages was tested when the organization faced the opportunity for growth • Palmer Sausages offered Johnsonville a private label opportunity to produce sausages which would amount to a 25% profit increase. • However the commitment would require another production shift added to the work force which would me rapid hiring of people who may not fit into organization, or significant overtime from the current employees. Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

23. In groups, answer the following question: How should Ralph Stayer react to Palmer Sausage’s request? What decision needs to be made and what is the best process for making this decision? Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

24. Final Outcome Stayer made his opinion known: that he thought the production would stretch the organization beyond its capacity, but announced that he had faith in the decision-making ability of his people. The members of Johnsonville Sausages, after weighing the pros and cons, elected to accept the offer and worked overtime consistently for 2 years so that they were not required to hire and then fire new people. Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

25. Comparing the Values and Vision of Lincoln & Johnsonville Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

26. Looking forward: • Can Ralph’s personal vision continue to serve Johnsonville in the future as the company gets bigger, goes public or he leaves? • What factors may limit the success of the vision in the future? Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

27. To make this degree of delegation work, there needs to be: • Clear objectives. • A willingness of the boss to give up authority and direct exercise of power. • Willingness of the people in the organization to buy0in. • Very good information and control systems so that individuals and activities can be measured. • Staff and managers that see themselves in supportive roles. • Great clarity in procedures. • Congruent incentives. • Skill, expertise down the line. • Trust in the leader! Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning

28. As an organizational change agent: You want to have a toolbox at your disposal for different approaches to change with a clear understanding of which approaches to change work best under what conditions Cummings & Worley, 9e (c) 2008 South-Western/Cengage Learning