The market in which the organization operates may be growing, making growth in output relatively easy to achieve. In addition, in a rapidly growing market, if an organization were to maintain a constant output, its market share would be falling. Development may be considered not so much a luxury as a necessity if it is to maintain its position in the market place. This could be particularly important for industries where economies of scale are an important consideration. (Palmer, A; Hartley, B 2005)
Some organizations may develop by acquiring competitors in order to limit the amount competition in a market where this is considered to be wasteful competition.
Define Organization Development:
With the changing of technology, market and environment faster and faster, an organization has to change the members’ attitude, knowledge and its own framework in order to adapt the various challenges. Organization development is a process that promotes the changes. The process of these changes can be considered as organization development.
Organization development is a main technology which can change the quality of working relationship among the workers.
The organization is an approach which believes people at all levels in an organization. In many cases, staffs are under-utilized and are capable, if given the opportunity, of taking on more responsibility for the work they do and of contributing further to the achievement of objectives. (Barbara Senior, 2002)
Organization development (OD) is a top-management-supported, long-range effort to improve an organization’s problem-solving and renewal processes, particularly through a more effective and collaborative diagnosis and management of organization culture-with the assistance of a consultant-facilitator and the use of the theory and technology of applied behavioral science, including action research (French & Bell, 1990).
Organization development is a process by which behavioral knowledge and practices are used to help organizations achieve greater effectiveness, including improved quality of life, increased productivity, and improved product and service quality. The focus is on improving the organization’s ability to assess and to solve its own problems. Moreover, OD is oriented to improving the total system-the organization and its parts in the context of the larger environment that impacts upon them. (Cumming and Worley, 1997)
The aim of OD is to update and maintain organization so that the company can keep development in such a competitive environment. It is a manner of reeducate in order to carry out the changing strategy with an effective planning. It is not only the changes of knowledge and information, but also in changes of attitude, technology, human relationship and culture. Some of OD theories consider that it can lead the organizational members built a new behavior via organization development process and reeducate, consequently, the strategically goal can be carried out.
Organization development has a clear goal and planning. It has top management support. The activities in OD process are all for making and carrying out the goals and planning. An advantage of a clear and idiographic goal is that it will motive the productivity better. We cannot emphasize the importance of confirming a clear goal too much. It exerts potential of technology and human. According to above ideas, a very important factor for OD must be confirming a long-range learning objective and operates the working skills.
The OD process
OD has three major steps: diagnosis, intervention and evaluation (French & Bell 1978; Huse & Cummings 1985; Mohrman, Mohrman, Ledford, Cummings, Lawler & Associates 1989).
It can be described as the following figure:
It is not an easy job for administrators to manage the process of OD. A very important reason is OD will change the recent framework. Learning is a effective manner which impetus the change for an organization.
The first step, it contains two steps. They are collect and analyze data. The manner of collecting data many methods, such as interviews, questionnaires. Then analyze the collected data in order to confirm both strengthens and weaknesses of organization. The significance of diagnosis can be divided into two factors: one is identifying the problem; the other is make sure the reason that cased the problem. It is clear that development is necessary when the efficiency is worse than before. However, the problem is that whether the point is clear or not. Managers should wake up to there is a problem that must be solved, if not, it would be caused other problems in the beginning of OD.
Intervention is the second step. The intervention technology which adapted in this step is directed feedback according to the diagnose result. It can be divided private level, group level and clear up the impact inside the group, and any other levels.
OD interventions or change strategies, are designed and implemented with the help of the change agent.
For the reason of planning is very important for keeping performance in an organization effectively, managers must develop the effectively techniques which are required for organization development.
There are many OD change strategies; four techniques of OD are given as below :( French & Bell 1978; Huse & Cummings 1985)
It watches the group, identifying any problems in communication partners and decision making. The purpose is to help develop members’ skills in identifying and resolving issues of group dynamics. (Bartol K, Martin D, Matthews G & Tein M, 2005)
Managers will know whether the conditions that OD process all right or not via watch the group. it will develop the members’ skills so that they will abet the development because there would be no serious for them to fair their would be dismiss in the new word condition or new technology.
It helps work groups develop effective task accomplishment. Like process consultation, it has OD consultant feedback on communication and conflict resolution. The consultant also helps assess group tasks, member roles, and work-task achievement strategies. (Bartol K, Martin D, Matthews G & Tein M, 2005)
It can be explained as a team work. Every members of organization play an important rule in a team work.
Working in groups gives each member a chance to express one’s own attitudes about the development.
It intervenes helps people, groups or departments resolve serious conflicts on specific work issues or caused by poor interpersonal relations. The OD consultant helps parties resolve difficulties by problem solving, bargaining and conciliation. (Bartol K, Martin D, Matthews G & Tein M, 2005)
Facing the organization development, some members including manage levels would oppose the changes. Some common reasons are they have not made sure that they will fit the work conditions after the development. Third-party helps organization solves these problems by negotiating with these members.
Technostructural is an application of science to achieve objectives related to the way parts are arranged to form a whole and intervention is the process of coming in between the original state and redirect toward the desired state.
Simply stated: “Technostructural interventions focus on improving an organization's technology and structure” (Cummings and Worley, 2001, p.149).
The activities help improve work technology and organizational structure. In this approach, the consultant helps members increase performance by showing them how to evaluate and make changes in task design and organization structure. (Bartol K, Martin D, Matthews G & Tein M, 2005)
Evaluation is the last step. It is better for organization that performs this step by third-party. The reason why it is difficult that do a highly evaluation in OD because of it is hard to find a standard to compare. However, the evaluation step is very important, because during the process of OD, do an effective evaluation will know the result of activities.
Managers can evaluate the results of OD by watching the changes before, such as profits. A manner of comparing with other firms can be used, for example, in 1990s, Motorola have some operation problems, during the development period, they compare with some firms like Texas Instruments, do some deeply research and imitation in order to increase the performance.
With the changes, OD efforts’ effectiveness must be checked. The ability to evaluate OD intervention effects depends on how well the diagnosis stage identified areas needing change, and specified results desired. (Bartol K, Martin D, Matthews G & Tein M, 2005)
In fact, OD impacts all the components in an organization. It contains the structure, culture, strategy; control system, group and human resource system of organization, others like communication, motivation and leading are all influenced by OD process.
Key organizational change components
Significant change or innovation usually means changing one or more of the key components of structure, technology, culture and human resources. (Leavitt 1964; Huse & Cummings 1985).
The components which will implement the change (Leavitt, in Cooper, Leavitt, & Shelly 1964)
Four key components for implementing change:
Organizational culture concerns the social and behavioral manifestation of a whole set of values which are shared by members of the organization and can be defined as ‘some underlying structure of meaning that persists over time, constraining people’s perception, interpretation and behavior’ (Jelinek et al., 1983)
“Culture consists in patterned ways of thinking, feeling and reacting, acquired and transmitted mainly by symbols, constituting the distinctive achievements of human groups, including their embodiment in artifacts; the distinctive achievements of human groups, including their embodiment in artifacts; the essential core of culture consists of traditional ideas and especially their attached values” (Kroeber and Kluckhohn, 1952).
Another definition is that of given as followings, which is:
Culture is the collective programming of the human mind that distinguishes the members of one human group from those of another. Culture in this sense is a system of collectively held values. (Hofstede, 1981)
Organizational culture is the assumptions, shared values, beliefs and norms linking members. (Sathe 1983; Smirchich 1983; Kilmann, Sexton & Serpa 1986).
The characteristics of culture are given as followings:
norms of behavior
beliefs, values and attitudes
language in the form of jokes, metaphors, stories, myths and legends
Major organization change needs culture change.
In order to bring about any kind of significant organizational change, the organization’s culture must be managed accordingly. However, changing an organization’s culture is not easy.
The word ‘technology’ can be easily misunderstood as simply being about computers and hi-tech industries such as aerospace. In fact, technology has a much broader meaning and influences our everyday lives. Technology is defined in the Longman Modern English Dictionary, as ‘the science of technical processes in a wide, though related, field of knowledge’.
Technology can be defined as ‘as the knowledge of how to accomplish tasks and goals’ (Dibb et al 1997)
Technology therefore embraces mechanics, electrics, electronics, physics, chemistry and biology and all the derivatives and combinations of them.
Technology is the knowledge, tools, equipment and work techniques an organization uses to deliver products or services. Technological changes come in new products and services. Technological innovations change work methods. Thus, word-processors and personal computers mean documents need not be retyped after correction. Technological change is very important for international competitions. (Bartol K, Martin D, Matthews G & Tein M, 2005)
Technology may drive change by requiring new work methods and providing competitive edge.
Technological development allows new goods and services to be offered to consumers and allows for new methods of distributing goods and services. New technology can allow existing products to be made more cheaply, thereby lowering their price. “Travel China” is a travel service company which has used information technology to develop databases to target potential customers and to maintain a dialogue with established customers.
Over the OD one of the difficulties is forecasting technological developments. These firms who are first to develop a technological lead will grow, as the technology is embedded in new industries and products. For example: a small restaurant want to improve its service in order to make the orders faster than before, by using Palm computer, they connect the Palm computer with a mainframe computer and printer. The costumer’s orders are all input and transformed and output by the computer. It is saved about 80% time than writing by hand.
‘The established pattern of relationships between the component parts of an organization, outlining both communication, control and authority patterns. Structure distinguishes the parts of an organization and delineates the relationship between them.’ (Wilson & Rosenfeld, 1990)
Another definition of organization is: ‘the formal pattern of interactions and coordination designed by management to link the task of individuals and groups in achieving organizational goals’. (Bartol & Martin, 1994)
These two definitions of structure taken together give a sense of the objectives which any structure must serve as well as the process through which these objectives can be met.
Organizations also have what has become known as ‘informal’ structures which are not designed by management but are the outcomes of friendship and interest groupings as well as those which serve political purposes, sometimes not related to the organization’s goals. (Palmer, A; Hartley, B 2005)
Structural transformation at Nestle
During the 1980s, the Swiss food giant Nestle operated a 1600-person head office controlling operations in over 100 countries. By the start of the 1990s, Nestle undertook to reorganize to make it slimmer, faster and more innovative.
Its head office and some of its national companies were originally organized on the basis of strong functional departments. Such specialists previously held tight control over decisions in these areas in the operating companies. Seven new strategic business units (SBU) were formed to cover Nestlé’s main product markets. One SBU had a worldwide strategic, as opposed to operational, responsibility for product-management decisions in the main functional areas like production and finance. Tow hundred head office jobs were cut. Regional management units were given more control over the companies in the regions than they previously had and the principle of ‘business asymmetry’ was employed, meaning that SBUs can be organized differently depending upon their particular needs as dictated by market conditions and production technologies.
Nestlé’s changes were not new to the business world and had been adopted by their competitors long before. (Lorenz, C 1992)
Nestlé’s clearly saw advantages in restructuring on a product combined with a location basis.
Human resource is the vehicle for changing knowledge, skills, perceptions & behaviors needed for a job. (Bartol K, Martin D, Matthews G & Tein M, 2005)
Human resource is one of the most important resources in all organizations. It is the activities that makes by managers in order to make sure there are will be fetch, keep and effectively use human resource. There are five major components of human resource system: recruitment, interview, selection, training/development, and performance appraisal and performance feedback.
These four major components impact each other. The other three may change while one changes.
Organization development is a main technology which can change the quality of working relationship among the workers.
OD impacts all the components in an organization. It contains the structure, culture, strategy; control system, group and human resource system of organization, others like communication, motivation and leading are all influenced by OD process. We had discussed the four components: structure, culture, and human resource and technology.
In order to manage the OD process well, managers must do well in controlling among the steps of OD process. They are diagnosis, intervention and evaluation.
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