UNIT-3

FACTORS TO ORGANIZATIONAL CHANGE

AND ORGANIZATIONAL CULTURE

Oct 1, 2021 1
 BRAINSTORMING QUESTIONS
1. What is Organizational Change?

2. What provokes Organizational Change?

3. How do you differentiate between a

planned change and an unplanned
change in an organization?

Oct 1, 2021 2
 DEFINITIONS AND APPROACH TO
ORGANIZATIONAL CHANGE
 Organizational change is defined as an alteration
of an orgn’s environment, structure, culture,
technology, or people.
 It is generally considered to be an organization-
wide change including:
 organizational culture,
 business processes,
 physical environment,
 job design / responsibilities,
 staff skills/knowledge and policies/procedures.

Oct 1, 2021 3
 MAJOR FORCES PROVOKING OF
ORGANIZATIONAL CHANGE
External forces Internal forces
 Competition Laws and  Strategy modifications
regulations
 New equipment
 New processes
 New technologies  Workforce composition
 Labor market shifts  Job restructuring
 Social change  Compensation and
benefits
 Labor surpluses and
shortages
 Employee attitude
4
Oct 1, 2021
FACTORS CRITICAL TO CHANGE
 Nature of the workforce
 Technology
 Economic factors
 Competition
 Social Trends
 World politics

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 FACTORS CRITICAL TO CHANGE
Key managerial competencies needed to
handle change:
 Leadership skills
 Communication skills
 Coordinating and Negotiating skills
 Planning and Controlling skills

Oct 1, 2021 6
 FACTORS CRITICAL TO
ORGANIZATIONAL EFFECTIVENESS
 Long term corporate objectives
 Organizational culture and values
 Management styles
 Business strategy
 Organizational structure
 Quality of human resources
 Working climate

Oct 1, 2021 7
 MCKINSEY’S 7-S MODEL

STRUCTURE

STRATEGY SYSTEMS

SUPERORDINATE
GOALS

SKILLS STYLE

STAFF

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CHANGE ANALYSIS DIAGRAM
External forces Present state Future state

Company Lack of profit Profitable

The Economies Duplication of Dynamic

Resources Quality
Suppliers Duplication of Orientation
Effort
Merger Progressive
Competitors Dilution of
Management
skills Technological
Technology Rationalization

Oct 1, 2021 9
 PLANNED CHANGE

 Planned change: Change activities that are

intentional and goal oriented.
 It is proactive and purposeful.
 Change agents: Persons who act as
catalysts and assume the responsibility for
managing change activities.

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 PLANNED CHANGE
 Planned change is generally initiated and
implemented by managers.
 Organization can use planned change to:

 Learn from experience

 Reframe shared perceptions,

 Adapt to external environmental changes,

 Improve performance and

 Influence future change.

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 GOALS OF PLANNED CHANGE

 It seeks to improve the ability of the org’n to

adapt to changes in its environment.
 It seeks to change employee behavior.
 Efforts to stimulate innovation, empower
employees, and introduce work teams

Oct 1, 2021 12
 GOALS OF PLANNED CHANGE
 In an organization, the goal/s of change is to
improve the org’n in some fashion - for
instance :
 reducing costs,
 improving revenues,
 solving problems,
 seizing opportunities,
 aligning work and strategy, and
 streamlining information flow within the
organization
Oct 1, 2021 13
ORGANIZATIONAL TARGETS OF
PLANNED CHANGE

14
Oct 1, 2021
 PHASES OF PLANNED CHANGE
According to Lippit et al., the phases of planned
change process are:
Recognition by top management that there is a
need for change in the organization
Establishment of a change relationship.
Movement towards the desired change by the
organization and its members
Stabilizing the change within the organization
Allowing the change agent to move on.

Oct 1, 2021 15
 RATIONAL MODEL OF
ORGANIZATIONAL ANALYSIS
 In this model the organization is conceived
as an “instrument" and its structure as
tools for the efficient realization of goals
and objectives. Changes are viewed as
planned devices to improve level of
efficiency.

Oct 1, 2021 16
 THE NATURAL SYSTEM MODEL OF
ORGANIZATIONAL ANALYSIS
 This model regards organization as a “natural
whole” or system.
 Its structure is viewed as emergent institutions.
 The organization, according to this model,
strives to survive and to maintain its
equilibrium.
 Here changes are considered as the results of
cumulative, unplanned , adaptive response
to threats to the equilibrium of the system
as a whole.
Oct 1, 2021 17
 THE CLASSIC MODEL OF
ORGANIZATIONAL ANALYSIS
 Workers are viewed as instruments
motivated by economic motives, existing to
carry out organizational objectives.
 Managers are considered rational and are
said to be possessing outstanding
personal qualities like kindness and fairness.
 However, his role defines him as having to be
firm with workers.

Oct 1, 2021 18
 THE CLASSIC ORGANIZATIONAL PATTERN
Top Managers
(Must define and Allocate Tasks)

Authority
Responsibility (Execution of Task)
(Communication
of Tasks)
Single
Organizational
Goals

Economic Man

(Performance due to Economic Motives)

Oct 1, 2021 19
 THE PARTICIPATIVE MODEL
 This model is derived from the work of
behavioral scientists.
 Here objective of the org’n is to achieve a
satisfactory integration between the needs
and desires of the members of the
organization and the persons functionally
related to it custemers, shareholders and
suppliers.

Oct 1, 2021 20
 CHANGE AND THE PARTICIPATIVE
MODEL
 Here change viewed as a total system
codification rather than an atomistic
alteration.
 we cannot introduce change into one small
part of organization, but we have to prepare
the entire organization ,since under the
model’s linkage pin design the entire
organization would be affected by the
change.
Oct 1, 2021 21
 ORGANIZATIONAL DEVELOPMENT
 Organizational development is an ongoing process of
change aimed at resolving issues through the effective
diagnosis and management of the organization’s culture.
 This development process uses behavioral and social
science techniques and methodologies through a
consultant facilitator and employs action research as one
of the main mechanisms for instigating change in
organizational groups.
 A collection of planned change interventions, built on
humanistic democratic values, that seeks to improve
organizational effectiveness and employee well-being.

Oct 1, 2021 22
 ORGANIZATIONAL DEVELOPMENT
Situations where OD is needed:
 The current nature of the organization is
leading to a failure to achieve its
objectives.
 Change requires to react faster to
external alterations.
 The introduction of factors such as new
technology requires change in the org’n
Oct 1, 2021 23
 PRE-REQUISITES OF
ORGANIZATIONAL DEVELOPMENT
 Commitment of top Management.
 The presence of strong influential managers.
 The existence of strong and competent internal
change facilitators and resourceful individuals.
 Capable and experienced external consultants.
 Successful experience with earlier efforts.
 Build-in reward system.
 Internalization of concern for renewal, constant
assessment of organizational health and corporate
excellence .

Oct 1, 2021 24
 LEVELS OF CHANGE IN
ORGANIZATIONAL DEVELOPMENT
 Ahmad identifies six major levels :
1. Organization in relation to its environment
2. Working of the total organization as a
system
3. Inter-team, inter-department and inter-
group relationships
4. Intra-team behavior and relationships
5. Inter-personal behavior and relationships
6. Intra-personal factors in behavior.
Oct 1, 2021 25
 FEATURES OF OD EFFORTS
 Respect for people
 Trust and support
 Power equalization
 Confrontation
 Participation

Oct 1, 2021 26
 STEPS IN ORGANIZATIONAL
DEVELOPMENT
Beckhard provides a five step model:
1. Diagnosis: Examination of the need for change
and the state of the system.
2. Strategy planning: Development of a plan for the
organizational improvement.
3. Education: Involves participation in a managerial
grid seminar or lecture programmes delivered by
experts to learn the ways for improving
organizational effectiveness .

Oct 1, 2021 27
 STEPS IN ORGANIZATIONAL
DEVELOPMENT
4. Consulting and Training: Implies the
consultation regarding existing practices or
planning for new practices.
5. Evaluation: Constant assessment of the
impact of the change programme on the
entire organization.

Oct 1, 2021 28
 ORGANIZATIONAL CULTURE AND
CHANGE CROSS-CULTURAL
EXPERIENCES

BRAINSTORMING QUESTIONS
1.What culture?
2.What is Organizational culture?
3.Can Organizations have similar culture?
4.How can organizational culture change?

Oct 1, 2021 29
 ORGANIZATIONAL CULTURE
 A system of shared meaning held by
members that distinguishes the organization
from other organizations.
 Organizational culture is represented by
norms, values, expectations and ways of
thinking and behaving of people in the
organization.
 Culture evolves over a period of time, it
becomes part of organizational life.
Oct 1, 2021 30
 ORGANIZATIONAL CULTURE
 Smirich defines Organizational culture as a
fairly stable set of taken-for- granted
assumptions, shared beliefs, meanings,
and values that bring forth a new way of
understanding of organizational life.
 According to Schein “culture” is for the deeper
level of basic assumptions and beliefs that
are shared by members of an organization,
that operates unconsciously.
Oct 1, 2021 31
 ORGANIZATIONAL CULTURE
 The culture of an organization is its
customary and traditional way of thinking
and of doing things, which is shared to a
greater or lesser degree by all its members,
and which new members must learn, and at
least partially accept, in order to be accepted
into service in the firm.

Oct 1, 2021 32
 CHARACTERISTICS OF
ORGANIZATIONAL CULTURE
1. Innovation and Risk taking: The degree to
which employees are encouraged to be
innovative and take risks.
2. Attention to detail: The degree to which
employees are expected to exhibit
precision, analysis, and attention to detail.
3. Outcome Orientation: The degree to which
management focuses on results rather than
on the techniques and processes used to
achieve those outcomes.
Oct 1, 2021 33
 CHARACTERISTICS OF
ORGANIZATIONAL CULTURE
4. People Orientation: The degree to which the
management decisions take into
consideration the effect of outcomes on
people within the organization.
5. Team Orientation: The degree to which work
activities are organized around teams rather
than individuals.

Oct 1, 2021 34
 CHARACTERISTICS OF
ORGANIZATION CULTURE
6. Aggressiveness: The degree to which
people are aggressive and competitive rather
than easygoing.
7. Stability: The degree to which organizational
activities emphasize maintaining status quo in
contrast to growth.

Oct 1, 2021 35
IMPACT OF ORGANIZATIONAL CULTURE ON
EMPLOYEE PERFORMANCE &
SATISFACTION
Objective factors
 Innovation and
Hig
h Performance
risk taking
 Attention to
detail
 Outcome
orientation Perceived as Organizational
 People culture
orientation
 Team
Satisfaction
orientation Lo
 Aggressiveness w
 Stability

Oct 1, 2021 36
 ROLE OF CULTURE

1. Specify the goals and objectives of the

organization.
2. Specify the relations that exist within the
organization.
3. Specify what qualities are valued within
the organization such as loyalty,
confidentiality, dynamism, hard work etc.
4. Specify the context within which
organization operates.
Oct 1, 2021 37
 DOMINANT CULTURE VS.
SUBCULTURE
 Dominant culture: A culture that expresses
the core values that are shared by a majority
of the organization's members .
 Subculture: will include the core values of
the dominant culture plus additional
values unique to members of a particular
department.

Oct 1, 2021 38
 CORE VALUES AND STRONG
CULTURE
 Core values: The primary and dominant
values that are accepted throughout the
organization.
 Strong culture: A culture in which the core
values are intensely held and widely shared.
 This is identified by cohesiveness, loyalty,
and organizational commitment.

Oct 1, 2021 39
 THE FACTORS INFLUENCING
ORGANIZATIONAL CULTURE
 The history and ownership
 The size of the organization
 Technology
 Leadership and Mission

Oct 1, 2021 40
 THE CULTURAL WEB

SYMBOLS

POWER
STRUCTURES
STORIES

THE
PARADIGM
ORGANIZA-
ROUTINES TIONAL
AND STRUCTURE
RITUALS
CONTROL
SYSTEMS

Oct 1, 2021 41
 CULTURAL CHANGE
 Three factors are responsible for
cultural change:
1. Composition of the Workforce
2. Mergers and acquisitions
3. Planned organizational change

Oct 1, 2021 42
 KEY FACTORS IN CULTURAL CHANGE
 Clear strategic vision

 Understand the old culture

 Top management commitment

 Symbolic leadership

 Supporting organizational structure

 Involvement of employees

Oct 1, 2021 43
 KEY FACTORS IN CULTURAL CHANGE
 According to K. Harigopal following are the
proceedings for cultural change:
1. Clear strategy
2. Understand the present functioning of the
organization.
3. Identify present culture and where it requires
change or modifications.

Oct 1, 2021 44
 KEY FACTORS IN CULTURAL CHANGE
 Communicate the change and translate it
into goals, activities and behaviors.
 Assure commitment from top mgt.
 Make changes from top down
 Involve employees in the change process
 Monitor the change process
 Defuse resistance

Oct 1, 2021 45
 ORGANIZATION CULTURE AND
CHANGE
 Organization culture is often so strong that it
transcends national boundaries.
 A strong culture provides stability to
organization and reduces employee
turnover.
 It can also be major barrier to change.
 It can have a significant influence on the
attitudes and behaviors of employees
which can be used for organizational
effectiveness and innovation.
Oct 1, 2021 46
OSU

STAY BLESSED!!!

47
 Thank You!

Oct 1, 2021 48