Yagya Raj Gurung 2009

Table of contents

Contents
Acknowledgement

1. Explore the background to change affecting the current organization

1.1 Discuss the background to change that exists in today’s economy...............................................3
1.2 Evaluate the strengths and weaknesses of bureaucratic organization...........................................5
1.3 Compare alternative forms of organization
development.................................................................8
2. Develop systems for understanding and involving others in the process of change
2.1 Develop systems to involve appropriate stakeholders in the introduction of change................12
2.2 Analyse and evaluate these systems................................................................................................14
3. Plan to implement models for ensuring ongoing change ongoing
3.1 Develop and adapt appropriate models for change........................................................................17
3.2 Plan the implementation process and outcome.............................................................................19
4. Bibliography.............................................................................................................................................21

4.1

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Acknowledgement

At first I convey my deep sense of gratitude and sincere indebtedness to my project

supervisor Mrs. Areeba Zafar, lecturer, EThames Graduate School, 277 Cranbrook
Road, Ilford for providing me with valuable guidance during this research endeavor
through development of ideas, invaluable comment and suggestions. It was a great
pleasure for me to work with him.

I would also like to gratefully acknowledge the management of this college for their
technical support and providing sufficient resources to study this project.

I am especially indebted to my friend Tapas and Chitrasen Gaikwad who helped me

very generously all through my project. Their thoughtful suggestion and views helped
me to complete the project. Last but not the least would like to thank all my
colleagues and friends who supported completing this project.

Yagya Raj Gurung

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1. Explore the background to change affecting

the current organization

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Discuss the background to change that exists

in today’s economy

At the very first beginning of human civilization people used to share their
things according to their needs and necessity. For an instance, a person who
needed 1kg of corns has to exchange with the other things which he has in
sufficient amount with his neighbour or any person in their locality. This
system of exchanging things according to their needs and necessity was
called barter system. Ages after ages this system has been transformed into a
system called business.
Business is a system of giving and taking for instead. The only difference with
the barter system is the cash. Cash is the common between people in
business. People give cash and buy whatever they need. Many researches
and development have been undertaken for the sake of business and it is still
in progress. Comparing to the developing stage after human civilization
people have started organization, industries and many business firms and
projects for the human survival and balancing the whole world through
business. Previously business used to be the means of communication
between different countries. They used to exchange their things what they are
rich in, with the other country.
When we look back to the human history of business, human needs have
been changing with the time and only those organizations has survived who
changed with the changing environment and those organizations which could
not adapt the change has extinct long time ago. Even today we see many big
renowned organisations have been shut down due to this only reason.
When Discussing about the background of today’s business and organization,
Frederick W. Taylor who is remembered as the father of scientific
management deeply committed to the study and understanding of work and
the improvement of worker efficiency. He always believed in maximal worker
productivity that is worker’s specialization in one job. Later Henry L. Gantt
supported Taylor and continued his idea by introducing rewarding employees

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to increase their efficiency. According to Montana and Charnov (2000), in

1929 Henry Fayol developed an administrative theory in which he
differentiated the managerial and supervisory level giving more status and
recognition. Those all discussed above was called classical approach of
business.
Later in early 20th century between 1927 and 1932 some social scientists
developed a different approach called behavioural school of management
theory.
Elton mayo, an Australian social scientist at University of Pennsylvania
discarded Taylor’s principle. After many surveys over Taylor’s principle in
practice, he concluded the workers were unhappy and employee turnover was
over 250 percent per year. He believed that employees neednotonly build
production oriented efficiency, but also to address the social values of the
organization and its employees. There should be a familiar relation between
workers and the managers.
Then later Douglas McGregor came up with his renowned Theory X and
Theory Y of motivation. The work of Montana and Charnov (2000b) explains
the two theories by McGregor have the conceptualization of the different
philosophical cultures regarding worker nature. Theory x defines the negative
part of the view of the employees whereas; theory Y explains the optimistic
view of employees. In practice this theory increased the personal growth,
work performance and improved the productivity as well.
This behavioural approach had a strong impact on management thought.
Then there evolved management science approach in mid 20th century
which believes that productivity of any business and organization can be
effectively increased by means of scientific method and mathematical models.
It was then successful in solving complex production problem.
Later it was criticised for its focus in production and workers.
There evolved a contingency approach which defines no any specific
methods or techniques for the problems in an organization. This approach
believes that the needs of any particular situation find out the best approach
to the organization problem.

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To sum up, we see from the above analysis of management studies and
strategies that theorists and socialists always try to come with a new
technique and idea to cope with the never lasting change in environment.

1.2 Evaluation of the strength and weaknesses of

bureaucratic organizations
Bureaucracy is the structure and set of regulations in place to control activity,
usually in large organizations and government. It is represented by standardized
procedure that dictates the execution of most or all processes within the body, formal
division of powers, hierarchy, and relationships. In practice, large scale organizations
follow certain rules and policies and regulates from top to bottom to achieve their
goal and they are called bureaucratic organizations. In contrast, there is a
management system called democratic which has completely opposite style in the
way to achieve the objectives.

Bureaucratic organizations have several peculiar principles of achieving goal rather

than in democratic organizations which are listed below:

 Due to its well hierarchy of positions and responsibilities, the business is

conducted in a flow from higher level to the bottom
 The rules and regulations are strict
 the roles and responsibilities are well assigned according to the posts
 all the resources belong to the organization and they are never personal

National army of every country is the best example of a bureaucratic type. Most of
the government organizations, corporations, NGOs, hospitals and schools are some
of the most known bureaucratic organization.

Today we are going to discuss about the strengths and disadvantages of the
bureaucratic type of organizations in the present context of the economy

Strengths of bureaucratic organization

Specialization:

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In a bureaucratic organization, every employees are specialized in their

job which they are assigned in order get the perfection in the productivity though this
is generally criticized by many economists because in my opinion, people doing
variety of job can lead to the imperfections and this may affect the goal achievement.
Thus specialization plays a very important role in the development of any
organizations.

Proper line of authority:

This type of organization has a special feature that is called the proper
line of authority. This means that there is a flow of authority from top level to bottom
level which is a very effective factor to reduce the inefficiency and to maintain the
standard of the business.

Impersonality and non interference

Since the hierarchy is well defined, the orders and the decisions are
taken by the personnel at higher, the impartiality and non interference are the good
consequences of this type of organization. There is no any concern with the other
parties rather than the official and which fits the rules of the office.

Employment and job security

The post and promotions of the individual is well defined in the

bureaucratic organization. The qualification and the experience is the most important
to be in the post. The higher the qualification and experience, higher is the post and
also the salary where the other type of organization lacks this benefit for the
employees. There is a full guarantee for not losing their job while in a democratic
type of organization there is no any guarantee of job security. The salaries are also
high paid and therefore the employees are supposed to be loyal and sincere to their
job.

Weaknesses of bureaucratic organization

Motivation

There are different types of employees and they have different style of
performing their job. Some people don’t want to take orders from their superiors and

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they like freedom in their job. This organization lacks to motivate such type of people
and this can affect the productivity.

Predefined rules and regulations

Some employees are demotivated due to the strict and pre defined rules
and regulations because they are fed up with doing the same job and taking orders
and complain from the superiors. This can be another factor to reduce the
productivity the organization.

Managing behaviour

We can see the same type of behaviour all the time in a bureaucratic
organization. The change is seldom seen in such organization. The managing
behaviour is same all the time so it may not be sometime easier to compete with the
competitors and which can result to a loss for the organization.

Flexibility

This type of organization is less flexible for the employees. They cannot
share their ideas and concepts with the management board which results de-
motivation in the employees.

Conclusion

According to Weber, this type of organization is capable of achieving the

highest efficiency. Although there are some bad aspects, bureaucracy is considered
to be the successful management. In conclusion, this system of management is the
best among other because of its line of authority, its discipline and the job security
for the employees since there is recessions and redundancies going over due to
global crisis and many people are losing their job daily.

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1.3 Comparison between alternative forms of Organizational

Development

An Organization is defined as two or more people working together under the

same roof to achieve a goal. Moreover, the development is an improvement that is
more effective over time and its smooth performance at achieving goals.
Organization Development (OD) is the approach towards improvement of the overall
performance and effectiveness of the organization, which may be a benefit to
individuals, groups, and organizations as a total system. According to Beckhard,
organization development is an effort planned, organization-wide, and managed from
the top, to increase the organization effectiveness and health through planned
interventions in the organization’s processes using behavioural- science knowledge.

According to Warren Bernus, organization development is about the change in

beliefs, values and entire structure of the organization. Modern organization requires
characteristics like flexibility, responsiveness, innovation, and openness whereas
control, rigidity, and predictability are the main characteristics of the traditional
organizations. Thus, today’s organizations need to replace the traditional
organizations. Company’s progress should always be monitored as well as
performance and results should be oriented.

The alternative forms of OD are discussed below:

Organizational culture:

Organizational culture is a concept, which describes the attitudes, experiences,

beliefs and values of an organization. This provides employees with an opportunity
to reflect on the values and behaviour that is needed by the organization. For the
development of the organization, there should be the culture or the system of taking
views and ideas from customers and everyone in the team must be involved in

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crucial events. If the participation of employees, team members and customers are
ignored, the organization certainly will vanish in this changing environment. Culture,
actually is not other than a system, needs to change with what the time demands in
order to develop the firm.

Organizational climate:

Climate and culture are both important to an organization. Climate generally

symbolizes to the situation, context, and environment of an organization. Climate is
sometimes regarded as an individual’s perception and cognitive representation of the
work environment. According to the Reichers and Schneider (1990) define
organizational climate as “the shared perception of the way things are around here”.
By knowing the climate of an organization it is easier to identify and measure those
aspects of a workplace which impact on stress, morale, quality of work, employee
engagement, turn over and performance.

Employee’s commitment:

Employee’s commitment is all about the passion of the workers with the work.
It shows how much the workers are committed to the job that is towards the
achievement of the objectives of an organization. Job satisfaction is the only factor
that motivates the employee to the higher performance. Thus for the development of
the organization, it requires a higher level of commitment by each and every member
of the company. Committed employees tend to have the better attendances and
longer job tenure than the less committed employees. Commitment must be to the
organization and to one’s team.

Conclusion:

In today’s team based, empowered, and technology dependant organization

every forms of OD is essential to manage it. Organization climate should be
appropriate for everybody. The involvement of employees, team members, and
customers in the production and decision making process are appreciable in
development of the organization.

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If any new type of conflicts occurs, it should be fixed from the argument
between all the employees and board so that it can be easily overcome in future
although it brings problems.

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2.Develop systems for understanding and

involving others in the process of change

2.1. Develop systems to involve appropriate stakeholders

in the introduction of change

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A person, group, organization, or system that affects or can be affected by an

organization’s objectives is called stakeholders. They may be internal or external to
the organization. They include owners or shareholders, managers, employees,
customers, government, suppliers or may be the community around the organization.
Stakeholders are one of the main factors that affect the organizational development.
Each type of stakeholders has their own roles and responsibilities in
organization. Thus an organization must understand them and should expand a
system to involve them in building up itself.
Today change has become a must in an organization in order to develop it.
Moreover participation of stakeholders is much more important. According to
Marshall et al (2000) change and development processes are central to such
organizational phenomena as careers, group decision making, innovation, and
interorganizational networks. According to Friedman and Miles(2006), the objectives
of the corporation is to maximize the number of potential stakeholders value either
as maximizing long-run profits, growth, or dividends which is also named a social
responsibility of business by Friedman(1962:74).
Thus a system needs to be developed to involve the appropriate stakeholders in
the introduction of managerial change in an organization. In order to develop the
system, we need to identify the definite stakeholders. Stakeholder analysis is a very
powerful tool. The analysis makes us aware of politics and positions and therefore
we can influence people to get to our end goal. Stakeholders if carefully taken they
are the main asset of the organization who can contribute their ideas, insight and
support in shaping the execution. They should be represented by specific roles in the
organization through which they can participate in the business. We need to develop
the capacity of the stakeholders which is the toughest job.
In order to make the participation of the influencing people to the organization, we
need to develop some systems. Some of the methods are:

1. Identifying the appropriate stakeholders:

Identification of the stakeholders is the first process of participating them in

the organizational development. Those people who are interested in the
project and understanding their power and position should all be convinced
with the objectives of the projects because they are the people who know the
present situation of the organization and their knowledge can be the great
asset for the organization.

2. Evaluate the relative power and influence of each stakeholder

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This step is about prioritizing the stakeholders that are affected by my work

Fig .1.: power and interest rate

The work of stakeholder analysis (2009) figures out the power of the
stakeholder according to their interest towards the firm or organization.

 High power, interested people: these are the people who must be fully
engaged with, and the greatest efforts should be made to satisfy.

 High power, less interested people: enough work should be put in with
these people to keep them satisfied, but not so much that they become bored
with message.

 Low power, interested people: these people should be adequately

informed, and talk to them to ensure that no major issues are arising. These
people can often be very helpful with the detail of your project.
 Low power, less interested people: again, monitor these people, but should
not bore them with excessive communication.
The ability to understand the often hidden power and influence of various is
the crucial skill for successful project managers. We need to drive the
attention and the interests of the stakeholders from the current interests
position to where it is required.

3. Influencing them for the action plan

The third most important process and system is the influencing the
stakeholders in the action and plans of the organization. We should
communicate with stakeholders early and often, we have to ensure that they
know what you are doing and fully understand the benefits of our project
which means they can support us actively when necessary.

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2.2.Analyse and evaluate the systems for the

stakeholder’s involvement
Identification of appropriate stakeholders

Stakeholders are the most crucial part inn the development of an organization.
According to Freeman(1984:242) there are several questions which facilitate
stakeholder identification, analyze their potentiality and capacity use them. As
defined by him those related questions are:

 Who are our current and potential stakeholders?

 What are their interests/rights?
 How does each stakeholder affect us( challenges and oppertunities)?
 How do we affect each stakeholder?
 What assumption does our current strategy make about each important
stakeholder?
 What are the current environmental variables that affect us and our
stakeholders?
 How do we measure each of these variables and their impact on us and our
stakeholders?
 How do we keep score with our stakeholders?

If we can answer these questions above, we will be able to analyze and map
stakeholders in the development process.

Analyzing the stakeholders

Next step is analyzing stakeholder’s behaviour. This should involve an

investigation of past and future stakeholder actions that could enhance or hinder
corporate goals. According to Freeman, if a manager explores all possible scenarios,
strategic surprise is limited and the downside risk dealing with the particular
stakeholder is covered. Then the managers must attempt to make logical

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explanation of why a stakeholder could act in the manager observed. Managers

should manage the environment for instances of interests, beliefs, or objectives
between stakeholder groups and then they should examine group stakes according
to economic, technological, social, political, and managerial effects. They should be
accurately understood and they should be always clear about their position and
roles.

Influencing stakeholders for the action and plan

More we work with and involve the stakeholders, the more chance you get to
observe them. Before we go for implementing the stakeholders into their actions the
manager should check and review their views and interests whether they still feel
secure and relevant to the objectives of organization. If they are not satisfied, they
should be asked the reasons and they should be well treated. The main aim is to
move stakeholder’s negative attitude to a positive one. Finally, the stakeholders
should be monitored and their expectations should be managed well. They should be
kept up to date which can promote the goodwill and build up reputation as an
excellent manager. They should be thanked after the objectives are fulfilled and they
should realize that they are the important person in the development process of the
organization.

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3.Plan to implement models for

ensuring ongoing change

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3.1. Develop and adapt appropriate models for

change
I am appointed as a manager for the Woodland Restaurant from this coming
fiscal year 2008/09. The Woodland is a fine Nepalese and Indian eat-in and
takeaway restaurant located near Lewisham Railway station. There are total 6
people working in the floor and 4 people working in the kitchen where 3 person work
as a waiter, 1 person works as a porter, one of them as bartender and me as a
manager. Although this is a small business, last year it couldn’t do well. There was
decrease in the number of customers. The restaurant needs a complete change in
everything. Its management was very poor and it was adopting the same
management for whole years and couldn’t progress for last two years.

Nowadays, credit crunch is very famous all over United Kingdom. Recession
and redundancies are cosmopolitan. The whole business world is suffering from two
diseases viz.recession and redundancies. The only remedy to survive from this crisis
is the change in management or may be change in plans, policies, rules and whole
system as well. Those who could not adapt the change, they have lied down their
knees on the ground and many of them are in process to go down. For an instance,
Woolworth and Marks&Spencers who used to be the leading businesses in UK.
Almost every organization needs change today to sustain in this changing
environment. Many theorists, economists, philosophers and specialists have given
their different views as a model for change and development of all types of
organizations.

Firstly, I would like to discuss about the well known model for change called
Kaizen model for change. According to BBC.co.uk, Masaaki Imai is the first person
to evolve this term in his book, Kaizen: The key to Japan’s competitive success.
According to Japanese literature Kaizen means continuous improvement. The basic
concept of this model is to identify and quickly remove waste. There is not any set
methodology to use this model. According to Steven et al, the Kaizen attitude
supports a continuous process of incremental improvements within an organization.

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There is another famous model for change which is called Kotter’s model of
organizational development. This model was originated by J.P.Kotter. This model
deals with several seven essential elements to all organizations.

They are listed as below:

 Key organizational processes

 The external environment
 Employees and other tangible assets
 Formal organization arrangements
 The internal social system
 The technology and
 Dominant coalition

Each of them should be considered carefully in order to develop the whole

organization. This type of model is generally preferred by large scale businesses.

Downsizing is a very classical model of the change for the development.

Downsizing refers to the reduction of the work force. According to this model, the
possible loss can be maintained by eliminating the unwanted employees from the
organization. The elimination of 10,000 employees from British Telephone and
removal of 1200 people from Nissan Four-wheeler Company are the best examples
of downsizing. Even large companies adopt downsizing model for change.

Rightsizing is also similar to downsizing model for the crisis management. It

means bringing the number of employees into right size by reducing unnecessary
employees from the company.

Delayering is another important concept or model to be discussed. It is all

about delayering or cutting the unimportant sections or departments and making
them single layer. This may cause the elimination of employees too. Some large
businesses start their business with many departments but after their profit is
reduced they manage their loss by delayering process.

Last but not the least; process reengineering is a new and a better concept for
the business to exist in this rapid changing world. This model is about remodelling
the whole process of the organization. According to this methodology some of the

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organization copy the competitor’s technology and try to come with new things like
price and technology. This type of model is generally used by supermarkets, hotels,
restaurants and almost all kind of small and medium scale business.

But I elect Kaizen model for my restaurant for developing because this is the
appropriate and effective model in today’s dynamic world

3.2.Plan the implementation process and

outcomes
The Woodland restaurant is the top and fine Nepalese and Indian cuisine restaurant
located in the heart of Lewisham. This restaurant is running profitless from last two
years and the only reason is negligence towards the increasing number of
competitors in the surrounding. The system of this restaurant was managed in the
same traditional way which used to be profitable in the past and now it needs a
complete change. As we know that the business world is facing a disaster, the
survival and the future prosperity has become the only target of recent existing
organization whether it is a large or a small organization. As I am appointed as a
new manager here the next step that I would take is the change in the whole
managerial system. I would like to implement the Kaizen model for change. The
whole implementation process is discussed below very briefly. The Kaizen model
process includes planning, directing, problem finding, clear, acknowledge, check and
act. The cycle of kaizen activity can be defined as:

 standardize an operation
 measure the standardized operation (find cycle time and amount of in-process
inventory)
 gauge measurements against requirements
 innovate to meet requirements and increase productivity

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 standardize the new, improved operations

 continue cycle

Planning is the first process of the Kaizen model. There should be some kind
of advertisements in the local newspapers and leaflettings should be done to
promote the business. After the advertisements at least local customers will get to
know about the prices and offers of the restaurants because local people are the
main target of the business. Each customer who comes in the restaurant for eating
or take-away is equally potential so they should be well treated. To attract more
customers the price of the dishes also plays a very important role. There obviously
needs a change in the price of the menu too because the price are too high in
comparison to other restaurants. Special offers will be given for every eat-in
customers For an instance “Buy 1 main dish get another main dish free of costs” and
“for every single table a small bottle of lager free for limited time”..

Weekends are very busy time for most of the restaurants and each day every
customers will be counted and find out the average weekend customers so that the
average income and expenses will be evaluated. Similarly in weekdays number of
customers is calculated and find out the average. This is the Do part of the whole
model. Similarly no service charges will be added to the bills. Highly experienced
waiters and kitchen staffs will be hired by the restaurant and every employee will be
motivated to give their best in customer care. There will be hygienic service and
interiors will be fine and well furnished. We will take the feedback from the each
customer about the food and their care through direct and indirect process. For an
example, placing feedback questionnaires on the table is the best way of getting
comments and sometimes just simply asking them about it. Whatever is the
feedback we will present to the staff meeting which will be discussed within and find
out the solution which is the problem finding part of this model. We change the things
and we will continue to take comments from them. If the change is not needed we
will pass it and regulate the process.

We have positive attitude towards the outcome and we will be changing

as required until the process ends and we are fully prepared for any kind of change.
Earning profit and the customer’s satisfaction are the obvious outcome which will
surely be achieved.

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References

Books

French W.L. and Bell C.-- Organization Development: Behavioural Science

Interventions for Organization Improvement(Prentice-Hall, 1999), ISBN:
013242231X, 9780132422314

Friedman, A. L. and Miles, S. -- Stakeholders: theory and practice (Oxford University

Press, 2006), ISBN 0199269874, 9780199269877

Gallos, J. V. and Schein, E.H.--Organization development: a Jossey-Bass reader

(John Wiley and Sons, 2006), ISBN 0787984264, 9780787984267

Have Johnson B.M and Webber P.B.—An Introduction to theory and reasoning in
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Have S.T., Stevens F. and Coyne F.P.—Key management models (Pearson

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Karake-Shalhoub Z.A.—Organizational Downsizing, discrimination and Corporate

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Waters D. -- Operations Management (Kogan Page Publishers, 1999) ISBN

0749427760, 9780749427764

Websites

Mind tools2009: Stakeholder analysis

http://www.mindtools.com/pages/article/newPPM_07.htm

bbc.co.uk2007: management studies

www.bbc.co.uk

business2000: organization management

www.business.com

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