Anthony Greg F.

Alonzo
Polytechnic University of the Philippines
Organizational Development
Dr. Gamboa
Position Paper

ORGANIZATIONAL DEVELOPMENT, SYSTEM CHANGE OR CULTURE CHANGE?

The organizational development (OD) tradition is a practitioner-driven intervention-oriented

approach to effecting organizational change via individual change, with view to increasing
effectiveness. It is implemented within a problem-solving model, places a heavy accent on
survey-based problem diagnosis and subordinates people to a vision of the future.
Commitment-based strategies of effecting change assume that the impetus for change must
come from the bottom up, whilst compliance-based strategies involve the creation of
behavioural imperatives for change.

Various ‘employee involvement’ strategies are reviewed, but there is little evidence for their
effectiveness either as a means of securing commitment or enhanced performance, or as a
means of leverage for change. Culture is assumed to be the primary vehicle for change
within the OD tradition, although the relationship between culture and the change process is
ill understood. Finally, the assumptions underpinning team development, and its
implementation, are critically examined.

The organizational culture literature itself is fraught with epistemological debate.

Practitioners are interested in management by measurement and manipulation of culture.
Theoreticians of culture, however, aim to understand the depth and complexity of culture.
Unresolved issues remain regarding how to define culture, the difference between culture
and climate, measurement/levels of analysis, and the relationship between organizational
culture and performance.

Interest in corporate identity is relatively recent, and is mainly driven by marketing and
strategic management considerations. More psychological approaches to the analysis of
corporate identity include an interest in how corporate identity is reflected in the identity
and self-esteem of employees, and the implications of this for managing organizational
change.
The classic OD approach to organizations and organizational change has been somewhat
‘side tracked’ today in favour of ‘knowledge management’, where knowledge and its
creation is seen as critical to organizational sustainability and competitive advantage in
today’s constantly changing global economy. Knowledge management raises issues about
the potentially highly complex relationship between structure, technology and people. The
dangers of a too tightly coupled understanding of the relationship between organizational
structure and technology are highlighted.

According to Douglas Fox, many people in business today think of Organization Development
(OD) as a culmination of initiatives and performance factors, typified with managerial
decision-making and control of change. This is certainly true, but is commonly combined into
a single premise: Organizations are human social systems in which people are strongly
influenced by the organizational culture. Therefore, the most compelling tool for
improvement is cultural change. 

Another way of looking at this is to say that OD transforms the organization by working with
social and technical systems such as (1) culture, (2) work processes, (3) communication, and (4)
rewards. (Left are some examples.)
Many companies' problems are not caused by their underlying infrastructure, CEO, or general
staff; the conflict is in the culture and social structure. As people who work in different cultures
act and perform differently, changing the culture can, theoretically, allow everyone to perform
more effectively and constructively.

Take Chrysler Motor Company OD initiative as an example:

In the early 1990s, Chrysler had terrible customer service and marketing, with a history of
innovation, but at the present time, outdated products. Its market share was falling, and its
overhead and losses were high. Bob Lutz, then the president, wanted Chrysler to become the
technology and quality leader in automobiles -- a clearly global vision. A program of cultural
change, Customer One, was built around it.
The results were impressive: overhead was cut by almost $5 billion in under four years, the
stock price has quadrupled, and the company reversed its slide into bankruptcy and became
profitable. A completely new and competitive line of cars or trucks has appeared each year
since. They did this with the same people, but working in different ways.

 Involvement of people - everyone got involved. Suppliers and customers gave design
suggestions, and their input was documented and later implemented. Mechanics and
 assembly line workers were consulted as well, and the results were a never before seen
alignment with consumer wants and needs.

 Agreeing on objectives - Core objectives were agreed upon at the beginning by all
departments. "Everybody agreed up front and we stuck to the plan. There were no last-
minute changes in focus, which can result in expensive disasters (such as the Corvair,
Vega, and Fiero). Because everyone is involved in setting goals, they take responsibility
for living up to them." (Jeep/Truck team member, n.p.).

 Learning - Changes in the production of cars began with help from Honda, who
developed a successful line-up, generally using their own technology. Fourteen young
engineers were told to learn how Honda designed cars; Bob Lutz and engineering chief
Francois Castaing then reorganized their departments into Honda-style teams. 
Since then, Chrysler changed its teams by learning from its achievements and mistakes.
They evaluate with a 'what went right, what went wrong' analysis at various points.

 Emphasis on quality - Surveying all customers and basing dealer incentives on quality
and support, the Chrysler dealerships rating process has been examined and improved
at various points, making sure their customer satisfaction index is valid and reliable.
Complaints are followed through, and negative surveys are returned to dealers for
resolution.

(1) Organizational culture can loosely be defined as the shared assumptions, beliefs, and
"normal behaviors" (norms) of a group. These are powerful influences on the way people live
and act, and theydefine what is "normal" and how to sanction those who are not "normal." To a
large degree, what we do is determined by our culture.

(2) Processes like work-flow mapping is one of the quickest ways to lower errors, increase
productivity, affecting customer service. Map out the way work is currently done. Diagram each
step, showing decision branches, time spent, any distances traveled or people contacted, and
other important aspects of the work.

(3) Effective meetings are uncommon, yet the most universal approach to good
communication. Ground rules: Know the problem, stay focused, get ideas flowing, expect
conflict, spread the responsibilities,and follow through.

(4) Rewards are usually the result of employee evaluations. They should be done not for raises,
promotions, or bonuses, but for growth, development, and communication. The most
important aspect in every case is communicationbetween the employee and other people,
instead of one-way communication, for higher performance.
(5) The person(s) responsible for initiating OD needs to gather information on the goals of the
individuals and areas involved, the expectations for the project, organizational constraints, and
other issues - (optimals/actuals/drivers).

(6) In order to raise motivation, one must look at how the organization's structure, technology,
management, and/or culture may have frustrated the employee, punished initiative, or
rewarded apathy.

(7) Continuous and necessary improvement is constantly adapting by getting and using
information, and by evaluating changes to make sure they were effective

Change Management

One of the most difficult parts of leadership is encouraging and managing organizational
change. It seems that only a small percent of change efforts actually succeed. There are many
reasons for this - indeed, the entire practice of organizational development is based on change
management. (Schein, 1996).

 Gather the information that supports your case for a change effort, and discuss it with
those who will be affected by it. You can clarify your vision, anticipate and resolve
potential problems, and sometimes even realize that the change is misguided, or that
there are far better alternative solutions.
 Use measurement tools: Tracking the effectiveness of the change effort both tells
people that it is important and provides a way to judge how well it is being
implemented, or how well it was designed.
 Avoid eliciting resistance by involving workers from the beginning, clearly explaining the
reasons for the change, having a clear strategy, direction, and vision, and respecting the
viewpoints of other people.