What is Organizational Development (OD)
The area of organizational development (OD) is an HR function that assesses the need for change, designs an intervention or process, helps management introduce the change, and then evaluates the effectiveness of the change. Organizational development typically takes a long-term approach to change and uses change to overcome problems and challenges within the firm, as well as to capitalize on strategic opportunities.
What does OD stand for?
Answer: Organizational development
To help adapt to change, many organizations engage in organizational development activities. The area of organizational development (OD) is an HR function that assesses the need for change, designs an intervention or process, helps management introduce the change, and then evaluates the effectiveness of the change. Organizational development typically takes a long-term approach to change and uses change to overcome problems and challenges within the firm, as well as to capitalize on strategic opportunities.
What is the purpose of organizational development?
To help organizations stay the same in the midst of global change
To help organizations adapt to change
To help organizations deal with external forces
To help organizations operate on smaller budgets
Answer: To help organizations adapt to change
Many organizations engage in organizational development activities to help with adapting to change. Nearly every organization, at some point, goes through significant change. To help adapt to change, many organizations engage in organizational development activities. The area of organizational development (OD) is an HR function that assesses the need for change, designs an intervention or process, helps management introduce the change, and then evaluates the effectiveness of the change.
True or False: Most organizations do not experience significant change.
_FalseNearly every organization, at some point, goes through significant change. Some of these changes are big (such as a merger, acquisition, or downsizing effort), while some changes are much smaller and less stressful (such as introducing new policies or products, systems, or processes)_
How should an organization go about dealing with changes to best cope with uncertainty when the changes occur?
Fight against the change because it will result uncertainty in the company
Ignore the change and know that it will work itself out if it is the right direction for the organization
Just be aware that uncertainty and lots of problems are inevitable
Assume the process of change
Answer: Assume the process of change
John Kotter, a Harvard professor and thought leader in change management, challenges managers to assume the daunting process of change so that their organizations are ready for the uncertainty that is sure to occur in today's global, chaotic and competitive environment.
True or False: Organizational development is a great HR function because it is a quick approach to change and easy to implement.
Answer: False
Organizational development typically takes a long-term approach to change. OD uses change to overcome problems and challenges within the firm, as well as to capitalize on strategic opportunities.
Which of the following shows where the organization's identity is found when it's in the recline phase?
In its programs
In its vision
In death
In its structure
Answer: In its programs
-The organization's identity in recline is found in its programs.
-The organization's identity in incline is found in its vision.
-The organization's identity in decline is found in its structure.
When an organization is in the incline phase, what are its resources spent on?
Preservation of the status quo
Implementation of programs
Strategic goals of the organization
Implementation of strategies
Answer: Strategic goals of the organization
When an organization begins its life, it usually has a vision of what it wants to be. The founder is clear and focused on the vision and allocates resources to achieve it. At this point, all its resources (e.g., human, financial, and operational) are directed toward the strategic goals of the organization. The organization is in the incline phase.
When an organization is in its decline phase, what can the organization do to help get back into the incline phase?
Create a new vision
Focus on programs
Focus on administration and committees
Focus on structure and ignore strategic visioning
Answer: Create a new vision
Often mature, more established organizations tend to focus on structure instead of design and innovation. At this stage, reorganization and political competitiveness often occur as departments vie for resources. Such organizations often become top-heavy (in administration) and/or have many committees whose time is taken as they try to maintain the organizational structure of the firm. As this process continues, the strategic vision can become nearly invisible causing the organization to enter the decline phase. As a result, organizations must create a new vision.
Which of the following shows where the organization's identity is found when it is in the decline phase?
In its programs
In its structure
In death
In its vision
Answer: In its structure
-The organization's identity in recline is found in its programs.
-The organization's identity in incline is found in its vision.
-The organization's identity in decline is found in its structure.
Which of the following is not a characteristic of the incline phase of the business life cycle?
Values-based decisions are being made
Resources are allocated more toward programs, products, and services
The business can be described as innovative
The business can be described as vision-driven
Answer: Resources are allocated more toward programs, products, and services
As the organization becomes more stable, it also becomes more comfortable and secure in what it is doing. Resources are allocated more toward its programs, products, and services, making sure they are marketed well. As a result, the vision often becomes less central and is communicated less frequently and effectively. At this stage, the organization risks becoming stagnant and entering the recline phase.
Common reasons for vulnerability include the three C's:
complacency, conservatism, and conceit.
Complacency describes those individuals (either management or line employees) who:
who are satisfied with the status quo. Such individuals do not see a need for change and do not feel that the effort to implement change is worth it. Often, individuals with a complacent attitude will take the approach that barriers to entry, government regulation, and/or other factors will protect the organization from competition. These individuals take the view that what has helped them succeed in the past will continue to help the organization succeed in the future.
Conservatism describes management and others who:
who safeguard resources for the sake of reserving them. Often, individuals with a conservative attitude are loyal to earlier or "traditional" ways of doing things. These individuals do not want to invest in change and want to marshal all resources for other strategic efforts (typically those efforts that have helped the organization succeed in the past).
"Conceit" refers to management who:
who suffer from hubris, whether that is focused on the organization and/or themselves. Instead of demonstrating an attitude of curiosity and desire to learn more about the organization and industry, these individuals believe that their current approach is the best way of doing things and see no need to change. They are often surprised when market and industry conditions change and they find themselves unprepared to compete successfully in the new environment.
Corporate Culture Inputs include:
feedback from society, managers, laws, stories, heroes, values, and other similar factors.
Corporate Culture Outputs include:
the behavior of the firm, technologies, strategies, image, products, appearance, and services.
When management feels that they are satisfied with the status quo and sees no need for change, which of the three C's "mindset of vulnerability" are they exhibiting?
Complacency
Confidence
Conservatism
Conceit
Answer: Complacency
Complacency describes those individuals (whether management or line employees) who are satisfied with the status quo. Such individuals do not see a need for change and do not feel that the effort to implement change is worth it.
Which of the three C's mindset of vulnerability usually leaves the organization surprised when the market changes and the organization is unprepared to compete in the new environment?
Confidence
Complacency
Conservatism
Conceit
Answer: Conceit
Instead of demonstrating a learning-type attitude towards the organization and industry, the conceited individuals believe that their current approach is the best way of doing things and see no need to change. Such organizations are often surprised when market and industry conditions change and they find themselves unprepared to compete successfully in the new environment.
Organizations become vulnerable to competition and market changes due to the three C's - complacency, conservatism, and conceit. Which of the following is an accurate definition of conservatism?
All of these
Suffering from hubris, either focused on the organization or the individual
Safeguarding resources for the sake of reserving them
None of these
Being satisfied with the status quo
Answer: Safeguarding resources for the sake of reserving them
Conservatism describes management and others who safeguard resources for the sake of reserving them. Often, individuals with a conservative attitude are loyal to earlier or "traditional" ways of doing things. These individuals do not want to invest in change and want to marshal all resources for other strategic efforts (typically those efforts that have helped the organization succeed in the past).
Which of the following is an input to the corporate culture?
Strategies
Behavior of the firm
Image
Feedback from society
Answer: Feedback from society
Inputs include feedback from society, managers, laws, stories, heroes, values and other similar factors. Outputs include the behavior of the firm, technologies, strategies, image, products, appearance and services.
True or False: Organizational change only affects structures and processes, not the corporate culture.
Answer: False
Organizational change must include not only changing structures and processes, but changing the corporate culture as well.
Needs analysis helps identify:
possible barriers to change. As management engages in needs analysis, they should ask the question, "From the perspective of our employees, what could keep them from embracing our desired change?" Possible answers may include: 1) Lack of knowledge or skills to embrace the change; 2) Lack of motivation to change; 3) Inadequate or unclear communication of what the change entails and why the change is needed; and 4) Unclear goals and expectations.
OD Intervention Objective methods may include:
analysis of key metrics such as rate of absenteeism, rate of turnover, or productivity.
OD Intervention Subjective methods may include:
surveys or interviews.
True or False: HR professionals typically only have to overcome resistance to change from the line workers or employees at lower levels of the organization.
Answer: False
HR professionals typically have to overcome resistance to change at all levels within the organization. Typically, managers ask, what could keep the employees from embracing our desired change?" Possible answers may include:
1) Lack of knowledge or skills to embrace the change
2) Lack of motivation to change
3) Inadequate or unclear communication of what the change entails and why the change is needed
4) Unclear goals and expectations.
Which of the following statements about attitude surveys is not true?
They are usually poorly done
They can cause employees to believe management cannot be trusted
Professionals recommend them
Attitude surveys can create expectations from employees and cause them to feel management is not listening
Answer: Professionals recommend them
Instead of conducting a formal report about the needs, many organizations simply conduct an attitude surveys. Attitude surveys are usually poorly done and poorly received by employees. They may create expectations from employees about what will be done if they provide input, and then if little or nothing is done it portrays management as not listening. Some managers may ignore the feedback or distort its real meaning leading employees to fee management cannot be trusted. Most HR professionals don't recommend attitude surveys.
True or False: As problems arise in the implementation of an OD intervention, it is important for HR professionals to keep to their original plan and not make changes, because that might cause the intervention to fail.
Answer: False
As implementation problems arise, organizations must use their knowledge and ability to adapt and learn to improve the change management process.
Which of the following is a subjective method for implementing the evaluation of an OD intervention?
Productivity
Performance appraisals
Tardiness
Absenteeism
Answer: Performance appraisals
Evaluation of an OD intervention is accomplished through objective or subjective methods. Objective results may include decreased absenteeism and tardiness, increased productivity, or other similar type measures. Subjective evaluation may include surveys, interviews, and performance appraisals.
True or False: Designing OD Interventions to include all levels of the organization including individual, department, and organizational levels helps promote attitude, behavior, and value changes.
Answer: True
When an organization decides that it wants to change, the HR professional should design interventions at the individual, department, and organizational levels. Such efforts typically promote attitude, behavior, and value changes. Examples of interventions include team building, executive coaching, organizational redesign/restructure, and various management and employee trainings.
Dynamic Change is:
is a constant change (or process) that evolves over time. Furthermore, because growing hair takes time and occurs in a gradual fashion (with small incremental changes), we would refer to the change as an incremental change.
Incremental Changes take:
take place in small steps that occur over time.
What is Quantum Change?
the change would be quite definitive and noticeable. This change would be much more severe and could include something like downsizing an entire plant within the organization. Such changes are nearly irreversible and create immediate change within the firm.
Static Changes are:
are definitive and occur almost instantly. Applied to the organization, incremental change would be a relatively small, quick change that would result in small changes throughout the organization. A good example of a static, incremental change would be periodically changing forms or paperwork to improve productivity.
The following are some common dynamics of change:
People will feel awkward and ill at ease
People will think of what they have to give up
People will feel alone, even if others are going through it also
People can only cope with a finite amount of change at a time
People are at different levels of readiness for change
People will revert to old behavior once the pressure is off
Which types of changes are nearly irreversible and create immediate change within the firm?
Static, incremental change
Dynamic, quantum change
Dynamic, incremental change
Quantum, static change
Answer: Quantum, static change
A quantum, static change could be severe and could include something like downsizing an entire plant within the organization. Such changes are nearly irreversible and create immediate change within the firm.
Which of the following is not a dynamic of change?
People will feel alone
People are all at the same level of readiness for change
People will think of what they have to give up
People can only handle a finite amount of change at a time
Answer: People are all at the same level of readiness for change
Common dynamics of change:
-People will feel awkward and ill at ease
-People will think of what they have to give up
-People will feel alone, even if others are going through it also
-People can only handle so much change at a time
-People are at different levels of readiness for change
-People will think they don't have enough resources
-People will revert to old behavior once the pressure is off
Which of the following is a change that is discontinuous?
Dynamic change
Quantum change
Static change
Incremental change
Answer: Static change
A common way to approach change management is to consider quantum vs. incremental change in either a dynamic (continuous) or static (discontinuous) environment. A good example of a static, incremental change would be periodically changing forms or paperwork to improve productivity. On the other hand, a quantum, static change would be much more severe and could include something like downsizing an entire plant within the organization. Such changes are nearly irreversible and create immediate change within the firm.
Which of the following represents a dynamic, incremental change?
A change that is immediate and sustained
A relatively small, quick change that would result in small alterations in the organization
Changes that occur at periodic stages and allow for continuous development within the firm
A severe change that creates an immediate difference in the firm
Answer: Changes that occur at periodic stages and allow for continuous development within the firm
A dynamic, incremental change could include a change in procedure (or process) within the firm. Such changes would typically occur at periodic (or incremental) stages and allow for continuous development within the firm.
A long-term merger would be what kind of change?
Dynamic, quantum change
Static, incremental change
Static, quantum change
Dynamic, incremental change
Answer: Dynamic, quantum change
A dynamic, quantum change within the organization would still create a sustained change but would have much more immediate impact on the firm. For example a dynamic, quantum change may include a long-term merger or acquisition with another firm.
A learning organization is:
a particular type of organization culture, where culture reflects the values, attitudes, and basic operating assumptions that are widely shared among organizational participants. A culture that supports organizational learning is one where members recognize the importance of learning at all levels, where learning is a continuous process that runs parallel to work, where there is a focus on creativity and innovation, and where the organization rewards individual and group learning and development. This type of culture is related to fewer levels in an organization's design and increased transfer of knowledge, regardless of level.
Organization Culture fulfills four basic functions:
Culture provides members an organizational identity
Culture facilitates collective commitment
Culture promotes system stability
Culture shapes behavior by helping members make sense of their work environment
Which of the following is NOT one of the basic functions of organizational culture?
Culture shapes behavior by helping members make sense of their work environment
Culture promotes system stability
Culture helps each individual have their own diverse identity
Culture facilitates collective commitment
Answer: Culture helps each individual have their own diverse identity
In addition to the definition provided above, it is useful to know that organization culture fulfills four basic functions:
Culture provides members an organizational identity
Culture facilitates collective commitment
Culture promotes system stability
Culture shapes behavior by helping members make sense of their work environment
Learning organizations are dedicated to all of the following except...
Keeping the knowledge acquired with upper management
Nurturing new and expansive patterns of thinking
Continuous learning
Expanding people's capacity to create the results they desire
Answer: Keeping the knowledge acquired with upper management
Peter Senge, a leading management scholar who served as director of the Center for Organizational Learning at MIT, stated that learning organizations are "organizations where people continually expand their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free and where people are continually learning."
What is usually the purpose of organization-level change?
Preventing a valuable employee from leaving
Remove obstacles to promotions
Change the organization's culture in some way
Increase the depth of the organization's hierarchy
Answer: Change the organization's culture in some way
Almost all organization-level change efforts are designed to change the culture in some way.
True or False: Learning organizations focus only on management being actively engaged in the learning process.
Answer: False
A culture that supports organizational learning is one where members recognize the importance of learning at all levels, where learning is a continuous process that runs parallel to work, where there is a focus on creativity and innovation, and where the organization rewards individual and group learning and development. This type of culture is related to fewer levels in an organization's design and increased transfer of knowledge, regardless of level.
Strategy refers to:
the way that an organization is going to reach its goals. It describes the process by which an organization decides which products or services to market and sell, which industries to enter, and how the organization is going to reach its desired goals in the marketplace.
True or False: When engaging in organizational change, it is important for both HR professionals and management to be aware of the strategic direction of the firm.
Answer: True
As organizations engage in organizational change, it is especially important that both HR professionals and management understand the strategic direction of the firm.
What does competitive strategy refer to?
The way an organization will reach its goals
The way the organization goes about its programs
The way an organization is going to compete
The way the organization sets up its policies
Answer: The way an organization is going to compete
Competitive strategy refers to the way that an organization is going to compete. In other words, strategy describes the process by which an organization decides which products or services to market and sell, which industries to enter, and how the organization is going to reach its desired goals in the marketplace.
True or False: When an organization builds its strategy, it does not need to worry about other organizations?
Answer: False
When an organization crafts (or builds) its strategy, it is specifically choosing the actions it will take in the marketplace, including how it is going to compete and outperform other organizations.
Which of the following will not help a company's strategy?
Deciding which products/services will be marketed
Deciding which industries to enter
Deciding not to have specific goals, but only work on image
Deciding how an organization will market products/services
Answer: Deciding not to have specific goals, but only work on image
Strategy refers to the way that an organization is going to reach its goals. It describes the process by which an organization decides on which products or services to market and sell, which industries to enter, and how the organization is going to reach its desired goals in the marketplace.
True or False: It is easy for customers and other outsiders to know an organization's strategy.
Answer: True
Employees, customers, vendors, and other stakeholders can often observe an organization's chosen strategy by evaluating what the firm does in the marketplace and asking a list of questions. A few of these questions are:
-What products and/or services does the firm market and sell?
-Does the firm take an offensive or defensive position?
-What makes the firm successful or unsuccessful?
Because strategy is about understanding how the organization is going to compete, it is essential that all organizations build and create a solid foundation. To build this foundation, the firm must continually ask itself three basic questions:
Where are we currently
What are our goals
How will we reach our goals?
Strategic fit refers to:
the degree to which an organization is able to match its internal resources and capabilities with opportunities in the external environment.
"External environment" refers to:
conditions, events, entities and factors that are external to, or outside, the firm. While organizations have the ability to respond to the external environment, they have no direct control over it. For example, organizations must be able to quickly respond to changes in markets, competition, labor, the economy, the regulatory environment, changes in suppliers and vendors, and even advances in technology. Organizations that are able to quickly and efficiently respond to the external environment are able to often reach new customers, provide innovative products and services, and integrate technology before their competitors do.
Internal Environment consists of:
the conditions, events, entities and factors that occur within (or internally to) the organization. As such, the internal environment includes employees, management, organizational culture and climate, research and development, internal technology and operations, organizational mission, internal resources, internal accounting, and organizational structure. As companies define their internal environments, they can align their resources to compete most effectively. A positive, effective internal environment can provide many firms with the competitive advantage they need to succeed in the marketplace
What is the first step to deciding what action to take as an organization?
Implement the organization's strategy
Understand where the organization is currently
Decide what future course of action is needed
Refine the organization's strategy
Answer: Understand where the organization is currently
Before organizations can refine their strategy and decide on any future course of action, the firm must first understand where the organization is at that moment.
Which of the following is not an advantageous result of getting feedback from stakeholders?
Improvement in overall productivity
Higher costs
Better processes
Higher level of customer service
Answer: Higher costs
In deciding where the firm is, it is helpful to get feedback from shareholders, customers, partners, and employees. Frank and honest feedback from stakeholders can help the firm improve processes, improve customer service, lower cost, and improve overall productivity.
True or False: There are many paths and futures for organizations to choose from and which will influence their goals. All of the paths will result in sustainability, profitability, and success.
Answer: False
Understanding the future path of the organization can be one of the most important questions that any organization can examine. When done correctly, deciding the goals and objectives of the organization can bring alignment and purpose to the firm. Organizations have a number of paths and futures from which to choose. Some of these paths will result in sustainability, profitability and success, while other paths will lead to decreased market share, lower profitability and possibly closure.
What characteristic will not help an organization respond well to the challenges and the constant changes of the external environment?
Being responsive
Being flexible
Being adaptive
Being unchanging
Answer: B
