2. © 2003 Prentice Hall, Inc. 8-1 Instructor presentation questions: docwin@tampabay.rr.com Chapter 8 Managing Strategic Organizational Renewal

3. © 2003 Prentice Hall, Inc. 8-2 Chapter 8 Outline  HR’S role in organizational change  Managing organizational change and development What to change Strategic change Cultural change Structural change Changes in people, attitudes, and skills Technological change Leading change: Lewin’s process

4. © 2003 Prentice Hall, Inc. 8-3 Chapter 8 Outline  Managing organizational change and development A ten-step change process Using organizational development Human process applications Technostructural interventions Human resource management applications Strategic applications

5. © 2003 Prentice Hall, Inc. 8-4 Chapter 8 Outline  Instituting total quality management programs What is quality? Total quality management programs HR’s role in quality management High-performance insight HR and Six Sigma HR and Baldrige awards HR and ISO 9000

6. © 2003 Prentice Hall, Inc. 8-5 Chapter 8 Outline  Creating team-based organizations The nature of self-directed teams and worker empowerment How HR helps to build productive teams High-performance insight Strategic HR HR and employee involvement programs

7. © 2003 Prentice Hall, Inc. 8-6 Chapter 8 Outline  HR and business process reengineering What is business process reengineering? HR’s role in reengineering processes Building teams Redesigning compensation Redesigning the work itself Moving from controlled to empowered jobs

8. © 2003 Prentice Hall, Inc. 8-7 Chapter 8 Outline  Flexible work arrangements Flextime and compressed workweeks Conditions for success Compressed workweeks Research insight Other flexible work arrangements HR.Net  Summary

9. © 2003 Prentice Hall, Inc. 8-8 After Studying This Chapter You Should Be Able To:  Explain and illustrate the steps in the change process  Reduce employee resistance to change  Describe the basic process for managing organizational change & development  Give specific examples of HR’s role in total quality management programs

10. © 2003 Prentice Hall, Inc. 8-9 After Studying This Chapter You Should Be Able To:  Show how companies use HR methods to create team-based organizations  Discuss the critical role of HR in business process reengineering  More effectively implement an organizational change

11. © 2003 Prentice Hall, Inc. 8-10 Strategic Overview  Select, train, and organize employees  Previously focused on the training and management development methods  Concepts and skills you need to more successfully implement organizational changes

12. © 2003 Prentice Hall, Inc. 8-11 Managing Change – What Do We Change?  Strategic change – a company’s strategy, mission and vision  Cultural change – a company’s shared values and aims  Structural change – reorganization  Developmental change – people’s attitudes and skills  Technological change – work methods

13. © 2003 Prentice Hall, Inc. 8-12 Cultural Change  Five ways to achieve cultural changes Make it clear to employees what you pay attention to, measure, & control React appropriately to critical incidents & organizational crises Deliberately role-model, teach & coach the values you want to emphasize Communicate priorities by how you allocate rewards & status HR procedures & criteria consistent with values you hold

14. © 2003 Prentice Hall, Inc. 8-13 Technological Change  Technology is a powerful engine of change  Creates change by modifying the work methods organizations use to do tasks  Results in reengineering work process  Must apply HR methods: Teamwork New job descriptions Boosting skill & knowledge levels More flexible work arrangements

15. © 2003 Prentice Hall, Inc. 8-14 Lewin’s Process Leading Change  3 steps Unfreezing Moving Refreezing

16. © 2003 Prentice Hall, Inc. 8-15 Ten-step Change Process Urgency Mobilize commitment Create a guiding coalition Develop a shared vision Communicate that vision

17. © 2003 Prentice Hall, Inc. 8-16 Ten-step Change Process Help make the change Generate short-term wins Consolidate gains Anchor new ways in culture Monitor progress & adjust vision

18. © 2003 Prentice Hall, Inc. 8-17 An Example of Change PECO Energy  Visioning event  List five critical processes  Town hall meetings with all HR groups  Resulted in changes to five processes  Organizational design event  Implementation

19. © 2003 Prentice Hall, Inc. 8-18 Using Organizational Development  Organizational development is a special approach to organizational change in which the employees themselves formulate the change that’s required and implement it, often with the assistance of a trained consultant Definition

20. © 2003 Prentice Hall, Inc. 8-19 Four Distinguishing Characteristics of OD 1.Action research 2.Behavioral science knowledge 3.Attitudes, values and beliefs 4.Changes organization in a direction

21. © 2003 Prentice Hall, Inc. 8-20 Four Types of OD Applications  Human process applications  Technostructural interventions  Human resource management applications  Strategic applications OD interventions & organizational levels

22. © 2003 Prentice Hall, Inc. 8-21 Human Process Applications  Aim first at improving human relations skills  Provide insights and skills required to better analyze behaviors  A facilitator uses survey research to solve problems & plan action

23. © 2003 Prentice Hall, Inc. 8-22 Human Process Applications  Sensitivity, laboratory, or T-group training are used minimally today  Team building can improve effectiveness  Confrontation meetings resolve misconceptions

24. © 2003 Prentice Hall, Inc. 8-23 Using OD to Increase Productivity  Technostructural interventions  HR management applications use action research  Strategic applications harmonize

25. © 2003 Prentice Hall, Inc. 8-24 T otal Q uality M anagement  Total quality management (TQM) is a type of program aimed at maximizing customer satisfaction through continuous improvements Zero defects Continuous improvement 6  Kaizen Definition

26. © 2003 Prentice Hall, Inc. 8-25 Total Quality Management Programs  Quality is the totality of features & characteristics of a product or service that bear on its ability to satisfy given needs  Quality measures how well a product or services meets a customers needs  ISO 9000 provides written quality standards to which products must comply

27. © 2003 Prentice Hall, Inc. 8-26 HR’s Role in Quality Management - Insight  Friendly phone staff is key to customer service at Lands’ end  Result of extensive screening & training  Must love to talk  All aspects of phone etiquette trained  Results in fast, friendly service

28. © 2003 Prentice Hall, Inc. 8-27 6  & Baldrige Awards  6 Sigma aims for 3.4 defects per million processes  To achieve this can be intense but very rewarding  Baldrige awards determined by a board of quality experts in 7 areas

29. © 2003 Prentice Hall, Inc. 8-28 Creating Team Based Organizations  82% of U.S. Companies use teams to perform some tasks  Self-directed teams have several distinguishing characteristics: Perform naturally interdependent tasks Use consensus decision making Team’s members perform enriched jobs Teams are also highly trained Employers empower the teams & individual members

30. © 2003 Prentice Hall, Inc. 8-29 Entrepreneurs + HR - Empowerment  Time Vision finds employee empowerment works well in cases that directly involve employees  Team investigates which retirement vehicle to use & has responsibility to switch to it  Finds empowerment requires right employee and correct training

31. © 2003 Prentice Hall, Inc. 8-30 How to Build Productive Teams  Establish demanding performance standards  Select members for attitudes and skills  Train leaders to “coach,” not “boss”  Use positive feedback  Select those who like teamwork  Train, train, and train some more  Cross-train for flexibility

32. © 2003 Prentice Hall, Inc. 8-31 Insight – Product Improvement Teams Need to be proactive Identify & correct problems Roadmaps guide progress Achieve continuous improvement

33. © 2003 Prentice Hall, Inc. 8-32 Strategic HR – Signicast Uses a Team Approach Employee suggestions Implement ideas Validate with employees

34. © 2003 Prentice Hall, Inc. 8-33 Employee Involvement Programs  An employee involvement program, a team activity, is any formal program that lets employees participate in formulating important work decisions or in supervising their own work activities  Managers rank them as great productivity boosters Definition

35. © 2003 Prentice Hall, Inc. 8-34 How to Create a Culture of Involvement & Participation  Educate all regarding business plans  Devote resources to build the necessary HR systems  Involve unions as partners  Involve in designing and implementing new systems  Train in new technologies

36. © 2003 Prentice Hall, Inc. 8-35 How to Create a Culture of Involvement & Participation  Promote employees’ continuous communication  Involve employees in assessing effects of new technology  Use telecommunications

37. © 2003 Prentice Hall, Inc. 8-36 Extending Decision Making Abroad  Prior to extending the work team approach abroad focus on these goals: Build trust Be aware of cultural differences Create blended strategies

38. © 2003 Prentice Hall, Inc. 8-37 Business Process Reengineering (BPR) “The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance such as cost, quality, service, and speed.” … Quote by experts Michael hammer & James Champy “Why do we do what we do?” Why do we do it the way we do?”

39. © 2003 Prentice Hall, Inc. 8-38 Steps in BPR Several jobs combined into 1 Workers make more decisions Reduce checks, controls to boost efficiency “Case manager” approach Check out

40. © 2003 Prentice Hall, Inc. 8-39 HR’s Role in Reengineering Process  Help build commitment  Promote team building  Redesign compensation  Redesign the work itself  Create empowered jobs Visit

41. © 2003 Prentice Hall, Inc. 8-40 Flexible Work Arrangements  Organizational renewal does not require massive change  Flextime allows workers to build their day around core midday hours  Compressed workweeks offer longer workdays but fewer of them

42. © 2003 Prentice Hall, Inc. 8-41

43. © 2003 Prentice Hall, Inc. 8-42 How to Make Flextime Successful  Use supervisory indoctrination programs  Most successful with clerical, professional, & managerial jobs  Most flexible programs are successful  Use a project director  A pilot program may be needed

44. © 2003 Prentice Hall, Inc. 8-43 Discussion – How Effective Are Flexible Work Programs?  What do you think?  Do flextime and compressed scheduling help or hurt workers?  What about a 12- hour shift that Dupont tried at its plants in Texas?  Can you think of any other flexible work options?

45. © 2003 Prentice Hall, Inc. 8-44 More Flexibility  Job sharing – two or more people share a single full time job  Work sharing – a temporary group work- hour reduction during economic slowdowns  Work from home or telecommuting – using the internet to “phone in” your work

46. © 2003 Prentice Hall, Inc. 8-45 Telecommuting  You can’t be a hermit when you telecommute  Its all about staying connected & in touch by using PC’s & laptops, text pagers, cell phones, e-mail, voice & fax messages, & PDA’s

47. © 2003 Prentice Hall, Inc. 8-46 Summary of Chapter 8  Managers lead by changing strategy, culture, structure, tasks, technologies, or attitudes  Use a ten-step process for organizational change  We saw a number of OD applications to promote change

48. © 2003 Prentice Hall, Inc. 8-47 Summary of Chapter 8  Quality is key to success – use TQM to achieve it  Teamwork or super-teams boost productivity  Reengineering results in fundamental changes  The most flexible work arrangements provide the greatest benefit