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MG312 Exam Notes Chapter 6 Organizational Development and Change
MG312 Exam Notes Chapter 6 Organizational Development and Change
Self-Designing Organization
- This is a type of approach that assists members to translate corporate values and general
prescriptions for change into specific structures, processes and behaviors suited to their
situations.
- A growing number of researchers and practitioners have called for self-designing
organizations that have the built in capacity to transform themselves continually to
achieve high performance in today competitive and changing environments.
Organisation transformation
- Burger U leadership team as champions of the new culture, and management at all levels
as committed agents of change
- At the outset of the change management process her challenge was threefold: (1) make
the six-store pilot program a success in 2013; (2) roll out brand culture change to the
remaining 11 stores no later than December 2014; and (3) work concurrently with the
consultants, head-office marketing and promotions team, and store managers to monitor
sales, attract new customers, retain existing ‘high value’ customers and brand advocates,
and ensure that the sales targets set by the BB Group board were achieved for 2014–15.
- Organisational culture includes the pattern of basic assumptions, values, norms and
artefacts shared by organisation members. It influences how members perceive, think and
behave at work.
- Organizational effectiveness is defined as a concept to measure the efficiency of an
organization in meeting its objectives with the help of given resources without putting
undue strain on its employees. It is about how the company can produce the target quota
of products, how efficient its process is, and how much waste is produced.
Identify any two approaches ‘change agents’ may use to diagnose organisational culture.
Organizational culture includes four major elements existing at different levels of awareness:
- 1 Artefacts. Artefacts are the highest level of cultural manifestation.53 They are the
visible symbols of the deeper levels of culture, such as norms, values and basic
assumptions. Artefacts include members’ behaviours, clothing and language; and the
organisation’s structures, systems, procedures and physical aspects, such as decor, space
arrangements and noise levels. At Nordstrom, a high-end retail department store in the
United States, the policy and procedure manual is rumoured to be one sentence: ‘Do
whatever you think is right.’ In addition, stores promote from within; pay commissions
on sales to link effort and compensation; provide stationery for salespeople to write
personal notes to customers; and expect buyers to work as salespeople to better
understand the customer’s expectations. By themselves, artefacts can provide a great deal
of information about the real culture of the organisation because they often represent the
deeper assumptions. The difficulty in their use during cultural analysis is interpretation;
an outsider (and even some insiders) has no way of knowing what the artefacts represent,
if anything.
- Norms. Just below the surface of cultural awareness are norms guiding how members
should behave in particular situations. These represent unwritten rules of behaviour.
Norms generally are inferred from observing how members behave and interact with each
other. At Nordstrom, norms dictate that it’s okay for members to go the extra mile to
satisfy customer requests and it’s not okay for salespeople to process customers who
were working with another salesperson.
- 3 Values. The next-deeper level of awareness includes values about what ought to be in
organisations. Values tell members what is important in the organisation and what
deserves their attention. Because Nordstrom values customer service, the sales
representatives pay strong attention to how well the customer is treated. Obviously, this
value is supported by the norms and artefacts.
- 4 Basic assumptions. At the deepest level of cultural awareness are the taken-for-granted
assumptions about how organisational problems should be solved. These basic
assumptions tell members how to perceive, think and feel about things. They are
nonconfrontable and non-debatable assumptions about relating to the environment and
about human nature, human activity and human relationships. For example, a basic
assumption at Nordstrom is the belief in the fundamental dignity of people; it is morally
right to treat customers with extraordinary service so that they will become loyal and
frequent shoppers.
- First, they offer products or services in more than one country and actively manage
substantial direct investments in those countries
- Second, worldwide businesses must balance product and functional concerns with
geographic issues of distance, time and culture. American tobacco companies, for
example, face technological, moral and organisational issues in determining whether to
market cigarettes in less-developed countries, and if they do, they must decide how to
integrate manufacturing and distribution operations on a global scale
- Third, worldwide companies must carry out coordinated activities across cultural
boundaries using a wide variety of personnel, including expatriates, short-term and
extended business travellers and local employees. Workers with different cultural
backgrounds must be managed in ways that support the overall goals and image of the
organization.
This orientation exists when the need for global integration is high but the need for local
responsiveness is low. The global orientation is characterised by a strategy of marketing
standardised products in different countries. It is an appropriate orientation when there is
little economic reason to offer products or services with special features or locally available
options. For example, manufacturers of office equipment, consumer goods, computers and
semiconductors, tyres and containers can offer the same basic product in almost any country.
Characteristics of the global design
The goal of efficiency dominates this orientation. Production efficiency is gained through
volume sales and a small number of large manufacturing plants; managerial efficiency is
achieved by centralising product design, manufacturing, distribution and marketing decisions
This strategic orientation exists when the need for global integration is low, but the need for
local responsiveness is high. It represents a strategy that is conceptually quite different to the
global strategic orientation.
This orientation exists when the need for global integration and local responsiveness are both
high. It represents the most complex and ambitious worldwide strategic orientation and
reflects the belief that any product or service can be made anywhere and sold everywhere.23
The transnational strategy combines customised products with efficient and responsive
operations; the key goal is learning. This is the most complex worldwide strategic orientation
because transnationals can manufacture products, conduct research, raise capital, buy
supplies and perform many other functions wherever in the world the job can be performed
optimally. They can move skills, resources and knowledge to regions where they are needed
The transnational orientation combines the best of global and multinational orientations and
adds a third attribute – the ability to transfer resources both within the organisation and
across national and cultural boundaries. Otis Elevator, a division of United Technologies,
developed a new programmable elevator using six research centres in five countries: a US
group handled the systems integration; Japan designed the special motor drives that make the
elevators ride smoothly; France perfected the door systems; Germany created the electronics;
and Spain produced the small-geared components.24 Other examples of transnational
companies include General Electric (GE), Asea Brown Boveri (ABB), Motorola, Electrolux
and Hewlett-Packard.