Learning Module 3-Second Semester Sophomores
(Business Functions and Applications)
CHAPTER 17:
ORGANIZATIONAL CHANGE AND CULTURE
LEARNING OBJECTIVES:
After Completing This Chapter You Should Be Able To:
1. Describe the four types of changes.
2. State why people resist change and how to overcome it.
3. Explain dimensions of an organization’s culture.
4. Explain dimensions of an organization’s climate.
5. List and explain the five steps of performance appraisals and state how performance appraisals can lead to
increased performance.
6. Explain the relationship among organizational culture, climate, and development.
LEARNING CONTENTS:
I. HOW CHANGE AFFECT BEHAVIOR, HUMAN RELATIONS, AND PERFORMANCE
Organizations have pressure to change from many sources.
WA 1- Give reasons why managing change skills are important to managers in an organization you work/ed for.
SA- Nothing in business, or life, is static. Change is inevitable and in business it is desirable when it increases
productivity. People have a tendency to resist change, and the manager's job calls for overcoming this resistance.
II. MANAGING CHANGE
A. Types of Changes. KT- types of changes are technological, structural, task, and people.
LO 1. Describe the four types of changes.
The four types of change are: 1. task, 2. structure, 3. technology, and 4. people.
1. Technological change. Technology is changing at a faster rate than every before, and continues to change at an
even faster rate. -Machines change the way business is done.-Process. Organizations continually change the way they
do things, or their process. KT- Management information systems (MIS) are formal structures for collecting, process,
and disseminating necessary information that aids managers in decision-making.
WA 2- Describe the MIS at an organization, preferably one you have been associated with.
SA- The MIS used at SC Inc. is the meeting file. Whenever anything comes up that should be discussed at staff
meetings, a manager punches it in to a file on the computer. This way everyone is prepared for the Tuesday staff
meetings. On Tuesday the file is printed and everyone gets a hard copy for the meeting.
-Automation. KT- Automation- the simplification or reduction of human effort to do a job. Machines and equipment
continue to make peoples jobs easier. In fact, they sometimes replace people. In manufacturing the numbers of
employees have decreased over the years as organizations continually upgrade their machines and equipment as a
means for increasing productivity.
WA 3- Describe an automation change in an organization, preferably one you have been associated with.
SA- In working for the college cafeteria we originally had a punch clock that stamped times in and out of work. This
year they installed a computerized punch clock that also calculates the hours worked each day and accumulates them
throughout the week. The manager no longer has to add up the hours with a calculator; his time is better spent doing
other activities.
2. Structural change. EX. When small organizations grow, they often hire new managers, which changes the chain of
command.
3. Task and people change. EX. When people change the way they do their job, their task has changed. With changes
in the task, structure, and technology organizations often need new people. Also a change in people, like a new
president, result in changes in task, structure, and/or technology. A change in one variable often requires a change in
other variables as well.
WA 4- Give one or more examples of a type of change you experienced in an organization (Identify it as a task,
structural, technological, or people change).
SA- An example of a technology change was when I worked in a BMW auto dealership. The new cars continually
have more sophisticated technology, which requires new tools and procedures. Technicians are sent to school each
year to learn to work on the new cars- people skills.
B. Stages in the Change Process.
III. RESISTANCE TO CHANGE AND HOW TO OVERCOME IT
A. Resisting Change. KT- resistance to change- the three variables are intensity, source, and focus and explain why
people are reluctant to change.
1. Intensity. How strong is people’s resistance to a change?
2. Source. (a.) Facts. Sometimes people resist change due to misinterpreting the facts. (b.) Beliefs. People tend to
view change as good or bad or right or wrong. When people believe change is wrong they tend to resist it. (c.)
Values. People have things that are important to them. When people do not value change, or see the benefit to them,
they tend to resist it.
3. Focus. (a.) Self. We all have a tendency to look at change with the question "what's in it for me?" "How does the
change help or hurt me?" When people believe change will not benefit them, they resist it. (b.) Others. We also
consider how change will affect others. When we believe others will be hurt by change we tend to resist the change.
(c.) Work environment. People have a tendency to want to control their work environment, having to change tasks
and procedures often results in resistance to change. When change threatens social relationships, it is often resisted.
WA 5- Describe a situation in which you were resistant to change. Identify the intensity, source, and focus. Use
Exhibit 14.3 to identify the box by number and statement about the resistance.
SA- We had a people change. We got a new supervisor in the corrugator department. (a.) My intensity was medium.
I heard he was tough and did not think he would like any of us. (b.) My source of resistance was my belief that he
was going to be strict and that I would not be able to enjoy my job any more. (c.) My focus of resistance was on
others, the new boss. This puts me in box number 5, belief about others. As thing turned out he made me feel
important, I ended up liking him after a while.
B. Overcoming Resistance to Change
As a manager, if you want to overcome resistance to change you must first identify its intensity, source, and focus, of
resistance to change. Then develop an implement a plan that will overcome the resistance to the change.
Eleven ways to overcome resistance to change include:
1. develop a positive climate for change,
2. encourage interest in improvement,
3. plan,
4. give facts,
5. clearly state why the change is needed and how it will affect employees, 6. create a win-win situation,
7. involve employees,
8. provide support,
9. stay calm,
10. avoid direct confrontation,
11. use power and ethical politics.
LO 2. State why people resist change and how to overcome it.
Resistance to change has three major variables: 1. Intensity, how strong is the intensity against change? 2. Sourcefacts, feelings, and values all influence our resistance to change. 3. Focus- it can be on self, others, or the work
environment.
Eleven ways to overcome resistance to change include: 1. develop a positive climate for change, 2. encourage
interest in improvement, 3. plan, 4. give facts, 5. clearly state why the change is needed and how it will affect
employees, 6. create a win-win situation, 7. involve employees, 8. provide support. 9. stay calm, 10. avoid direct
confrontation, 11. use power and ethical polities.
C. Responding to Resistance. (say: as you have read there are ways to respond to resisters to change. You may want
to respond in these ways when the need arises.)
D. Change Models.
LO 3. Explain how to use a change model when making changes.
The steps in the change model are: 1. define the change, 2. identify possible resistance to the change, 3. plan the
change, 4. implements the change, 5. control the change.
WA 6- Give a specific example of when the change model would be helpful to a specific managers.
SA- The change model should be used with any major change in an organization. One such example could be
implementing new techniques for processing materials. Planning the change and training employees are necessary for
successful change.
IV. ORGANIZATIONAL CULTURE
KT- organizational culture- consist of the shared values and assumptions of how its members will behave.
LO 4. Explain dimensions of an organization’s culture.
The dimensions are strong and weak and positive and negative cultures.
A. Learning the Organization’s Culture
Heroes
Stories
Slogans
Symbols
Ceremonies
WA 7- Identify the cultural heroes, stories, symbols, slogans, and ceremonies for an organization you are/were a
member of.
SA- At Springfield College I heard that Dogget was a hero. I don’t recall any stories. The triangle of spirit, mind, and
body is the symbol and the Humanics Philosophy is a slogan at SC. There are a few ceremonies, such as stepping-up
day.
B. Strong and Weak, Positive and Negative Cultures.
1. Strong and weak cultures. Organizations with clear shared values have strong cultures; while organizations
without clear shared values have weak cultures. IBM, PepsiCo, and J.C. Penny all have strong cultures.
2. Positive and negative cultures. Positive cultures contribute to the organizations performance; while negative
cultures hinder performance.
WA 8- Describe the organizational culture at a firm you work/worked for. Does the organization strive to have a
strong positive culture? If so, how?
SA- In addition to being a student at Springfield College, I also work for the PPD department. SC has a strong
culture. The “Humanics Philosophy” of educating the whole person- sprit, mind, and body is on the college logo.
Humanics statements are all over the college catalog, other literature, and on the walls of buildings. There is a
friendly atmosphere on campus, everyone says hi, even though they don’t know each other. Every year there is a new
Humanics professor who gives a Humanics lecture toe the faculty and students.
V. ORGANIZATIONAL CLIMATE
KT- organizational climate- a relatively enduring quality of the internal environment of the organization perceived
by its members. It refers to the atmosphere and morale of employees.
KT- morale- a state of mind based on attitudes and satisfaction with the organization. When employees are happy
with the organization morale tends to be high. Employees who are always complaining and dissatisfied with the
organization tend to have low morale.
A. Dimensions of Climate.
LO 5. Explain dimensions of an organization’s climate.
The dimensions include: structure, responsibility, rewards, warmth, support, risk, organizational identify and loyalty.
B. Common dimensions of climate include:
1. structure
2. responsibility
3. rewards
4. warmth
5. organizational identity and loyalty
6. risk taking
WA 9- Describe the organizational climate at a firm you work/worked for, based on the seven dimensions of climate.
Does the organization measure its climate? If so, how?
SA- Last summer I worked for the Hill Moving Company. (1) The structure was rigid. There were a lot of rules and
procedures for moving. (2) There was little responsibility. The boss just told us what to move, when, and where to
put it. (3) The pay was pretty good, but you got the same pay if you worked hared or took it easy. (4) The human
relations were good. Our crew had four members and the foreman. Three of us were college students so we got along
really well. (5) The foreman and Hank were full-time employees and they were loyal, but we college guys didn’t care
much about the company. We viewed it as a summer job we’d leave. (6) There wasn’t much risk to talk. I don’t think
the organization ever measured climate.
WA 10- Describe the morale at an organization you work/worked for.
SA- The overall morale at Springfield College is positive. Students and faculty are generally satisfied with the
college. There is a friendly relationship between the student body and faculty; and the faculty and administration get
alone OK. The faculty is underpaid making morale shaky during budget times. But, the administration has been
steadily increasing salaries, helping to keep morale up.
VI. ORGANIZATIONAL DEVELOPMENT
KT- Organizational development (OD)- the ongoing planned process of change to improve the organization's
effectiveness in solving problems and achieving objectives.
LO 9. Describe six OD techniques.
Organizational development is the ongoing planned process of change to improve the organization's effectiveness in
solving problems and achieving objectives. The six OD techniques are: 1. Training and Development to teach people
their jobs. 2. Performance Appraisal to evaluate employee job performance. 3. Grid OD, a six-phased program
designed to improve management and organizational effectiveness. 4. Survey feedback, uses a questionnaire to
gather data that are used as the basis for change. 5. Force field analysis is used to diagram the current level of
performance as well the hindering and driving forces. 6. Team building, is designed to help work groups operate
more effectively.
WA 15 asks for an OD example. You may ask students for their examples as you cover each technique, or wait until
the end as a review of the section.
A. Managing and Changing Culture and Climate through OD.
B. Training and Development.
KT- Training is the process of developing the necessary skills to perform the present job. Development is the process
of developing the ability to perform both present and future jobs.
1. The Training Cycle.
LO 6. Describe the training cycle and how training is used to increase performance.
Step 1. conduct a needs assessment, 2. set objectives, 3. prepare for training, 4. conduct the training, 5. measure and
evaluate training results. Employees can get more work done when they follow proper procedures than when then use
wasted motions.
WA 11- State how you were trained to perform a specific job. Explain how the training affects your job
performance. How could the training at this organization be used to increase productivity?
SA- My training was done on-the-job, and it was very short. The methods used were: 1. Reading. My supervisor
gave me information to read to familiarize myself with various projects and to see examples of the types of projects
I'd be writing. 2. Lecture. I got lectures from the project managers, directors, and the office manager. 3. Video. They
have a video describing the organization, which they show all new employees. 4. Question and Answers. This
method was used the most. I feel they did a great job, I would not change anything.
C. Performance Appraisal. KT- Performance appraisal- the ongoing process of evaluating employee performance.
The Performance Appraisal Steps.
LO 8. List and explain the five steps of performance appraisals and state how performance appraisals can lead to
increased performance.
1. job responsibilities, 2. develop standards and measurement methods, 3. informal performance appraisals, 4.
preparing for the formal performance interviews, 5. conducting the formal performance appraisal interviews.
Performance appraisals can provide motivation and feedback to employees on ways to do a better job.
Exhibit 14-9 Performance Appraisal Steps, may be shown to illustrate the five steps.
The five steps in the performance appraisal process are:
1. Job responsibilities, a rank order of the important task performed.
2. Develop standards and measurement methods, KT- standards- describe performance levels in the areas of quantity,
quality, time, and cost. Clear objectives and standards are needed in order to measure performance.
WA 12- Describe the performance standards for a job you hold/held. How would you improve them?
SA- Honestly, with the job I hold there are no standards. I just make sure I do everything that is put on my desk. I
should set standards so an employee would be able to judge his or her performance.
WA 13- Identify the performance measurement method(s) used to evaluate your job performance. Describe how you
would improve the method(s).
SA- My supervisor used the rating method. He has a check list that he completed each month to let us know how we
were doing. He could improve the method by having an interview rather than simply handing us a card each month.
No one paid attention to the rating because nothing was ever done with it, unless a person was doing a really bad job.
3. Conduct informal performance appraisals-coaching, employees need regular feedback on their performance. Once
or twice a year is not enough. KT- coaching model.
LO 7. List and explain the steps in the coaching model.
1. Refer to past feedback. 2. describe the current performance. 3. describe the desired performance. 4. get a
commitment to the change. 5. follow up.
WA 14- Describe a specific situation I which it would be appropriate to use the coaching model.
SA- An employee hands in a report, but it is only on a superficial level. The supervisor could (1) remind the
employee of the way it should have been done. (2) Refer to specific areas in which the report is weak. (3) Explain
how the weak areas can be overcome in the future. (4) Get the employee to agree to the changes in the reports. (5)
Check future reports and praise or reprimand as appropriate.
4. Preparing for the formal performance interviews.
5. Conducting the formal performance appraisal interviews, employees should understand why they received the
specific rating they got, and understand how to improve for the next review period.
D. Grid OD. KT- Grid OD- a six-phased program designed to improve management and organizational
effectiveness. The six-phases are stated in the text.
E. Survey Feedback. KT- Survey feedback- uses a questionnaire to gather data that is used as the basis for change.
This OD technique commonly follows six steps, as stated in the text. When using a questionnaire to attain
information from employees it is important to follow up with action to improve the situation, or at least state why no
change will take place.
1. Measuring Climate.
F. Force Field Analysis.
KT- Force field analysis- used to diagram the current level of performance as well as the hindering and driving
forces. When using force field analysis it is important to overcome the hindering forces for change while maintaining
or increasing the driving forces for change.
G. Team Building. KT- Team building- designed to help work groups operate more effectively. During team
building the change agent helps the group to look at how the people interact as they work together, and how to work
together more effectively. Team building programs vary with the change agent's preferences and the needs of the
group.
1. Team-building goals.
2. The change agent’s responsibilities.
3. Team-building program agenda.
WA 15- Identify an OD technique and explain how it is used by a specific organization, preferably one with which
you have been associated.
SA- When I worked for a pizza chain, my boss used to have the employees fill out forms asking us how we could
improve operations. Most of the changes in the store came from the survey results. My boss would show the district
manager the suggested change and report on its results. So our ideas were used in other locations too.
VII. THE RELATIONSHIP AMONG ORGANIZATIONAL CULTURE, CLIMATE, AND DEVELOPMENT
These concepts are different yet related. Culture forms climate, and organizational development programs are
commonly used to develop culture and climate.
LO 10. Explain the relationship among organizational culture, climate, and development.
These concepts are different yet related. Culture forms climate, and organizational development programs are
commonly used to develop culture and climate.