Download LECTURE 11 NOTES CHANGING ORGANIZATIONS Stress, Conflict

LECTURE 11 NOTES
CHANGING ORGANIZATIONS
Stress, Conflict, and Virtuality
SUMMARY:
Lecture 11 begins the student’s study of changes that occur within an organization,
determining what changes might be needed, handling the resistance that comes from
change, who should implement the change. Additionally organizational development
initiatives are discussed, as are stress, conflict, and the concept of virtuality.
The reality is one of the only things constant today is change, so students therefore need
to be aware of change initiatives and the organizational and human issues associated
with the change process.
LEARNING OBJECTIVES:
1. Fundamental principles of changing an organization
2. Insights about factors to consider when changing an organization
3. An appreciation for the relationship between change and stress
4. Insights concerning how to handle conflict as a factor related to organizational
change
5. Knowledge about virtuality as a vehicle for organizational change
TARGET SKILLS:
Organizational Change Skill: the ability to modify an organization in order to
enhance its contribution to reaching company goals
OUTLINE:
This is divided into five sections:
1. Fundamentals of Changing an Organization
2. Factors to Consider When Changing an Organization
3. Change and Stress
4. Change and Conflict
5. Virtuality
Fundamentals of Changing an Organization:
This section focuses on changing the organization.

Defining Changing an Organization
o Changing an Organization
 The process of modifying an existing organization to increase
organizational effectiveness
 Changes typically effect the lines of organizational authority, levels of
responsibility held by various organization members, and established
lines of organizational communication

o The Importance of Change
 Managers realize if their organizations are going to succeed, they need
to continuously change in response to developments and changes in
the environment – customer needs change, technology changes, etc.
 Change is inevitable and organizations need managers who can assess
the need to change and implement the necessary changes
 The text provides a listing of changes GM has made over the years –
updating the list to include 2014 changes in CEO, recalls, etc. would be
beneficial here as well
Change Versus Stability
o In addition to organizational change, some degree of stability is a prerequisite
for long-term organizational success
o Figure 11.1 provides an illustration of the Hellriegel/Slocum model of
adaptation, stability, and organizational survival
o The Hellriegel/Slocum model stresses organizational survival and growth are
most probable when stability and adaptation are high within the organization
Factors to Consider When Changing an Organization:
This section discusses the major factors that should be considered whenever organizational
change is being considered. This section of the chapter discusses each of these factors
individually: Change Agent, Determining What Should be Changed, The Kind of Change to
Make, Individuals Affected by the Change, and Evaluation of the Change.
Figure 11.2 illustrates the collective influence of these five major factors on the success of
changing an organization


The Change Agent
o The most important factor
o Change Agent – individual or individuals inside or outside the organization
who will work to modify and implement the existing organizational situation
o Requires special skills
 Ability to determine how a change should be made
 Skill to solve change-related problems
 Experience of using behavioral science tools to influence people
appropriately during the change initiative
 Additionally – the individual needs to be able to discern just how much
change employees can withstand
Determining What Should be Changed
o In general, managers should only make those changes that will actually
increase organizational effectiveness
 People
 Structure
 Technology
o People Factors
Attitudes, leadership skills, communication skills, and all other
characteristics of human resources within the organization
o Structural Factors
 Organizational controls, policies, and procedures
o Technological Factors
 Types of equipment or processes that assist employees in the
performance of their jobs
o Figure 11.3 in the text demonstrates how these three factors combined impact
organizational effectiveness
o The text provides an interesting example of the University Health System in San
Antonio, Texas, as an example of organizational change
The Kind of Change to Make
o Changes are typically categorized as technological, structural, or people
o Technological Change
 Modifying the level of technology used in the management system
o Structural Change
 Changing organizational controls that influence employees during the
performance of their jobs
 Describing Structural Change
 Change aimed at increasing organizational effectiveness
through modifications to the existing organizational structure
o Clarifying and defining jobs
o Modifying organizational structure to fit the
communication needs of the organization
o Decentralizing the organization to reduce the cost of
coordination, increase the controllability of subunits,
increase motivation, and gain greater flexibility
o People Change
 Describing People Change: Organization Development (OD)
 Focus is on changing individual employee characteristics such
as attitudes and leadership skills
 Organization Development (OD) – the process of people change
 Grid OD
 Managerial Grid is a theoretical model describing various
management styles and is used as the foundation for grid OD
 Figure 11.4 illustrates the Managerial Grid, five managerial
styles, and factors that characterize each of these styles
 Based on the premise various managerial styles can be
described by two primary attitudes of the manager
o Concern for People
o Concern for Production
 Each attitude is placed on an axis scaled 1 through 9 and used
to generate five managerial styles
o Ideal Style


9,9 on grid – managers have a high concern for
production and high concern for people – the
purpose of the grid OD is to change the thinking
of organization managers so that they will work
toward adopting the 9,9 style
o Main Training Phases
 Grid OD training involves six phases used with all
managers in the organization
 First two phases involve acquainting
managers with the managerial grid
concept and working with them to identify
which managerial style they most
commonly use
 Last four phases concentrate on
encouraging managers to adopt the 9,9
style and show them how to use this style
within their specific job situations
o Evidence and research have shown the grid OD program
does result in enhancing profit, positively changing
managerial behavior, and positively influencing
managerial attitudes and values – though more research
is needed to have conclusive statements
o The Status of Organization Development
 Changes that emphasize both people and the organization as a whole
have inherent strength
 Weaknesses do exist
 Effectiveness of OD is difficult to evaluate
 Programs are time-consuming
 Objectives are commonly too vague
 Total costs are difficult to gauge when the program starts
 Programs are generally too expensive
 Managers can work to decrease weaknesses and increase strengths by
working toward systematically tailoring OD programs to meet specific
needs of the organization, demonstrate exactly how people should
change their behavior, and change organizational reward systems so
that those individuals who do make the change are rewarded
Individuals Affected by the Change
o Making the change is wasted if organization members do not support the
change
o Resistance to Change
 Resistance to change within an organization is as common as the need
for change
 Managers immediately meet this resistance as soon as they have
determined there is a need to make an organizational change


People are worried about fear of personal loss, reduction in personal
prestige, disturbance of established social and working relationships,
and personal failure because of their inability to carry out new job
responsibilities
o Reducing Resistance to Change – the text provides descriptions of ideas
managers can take in each of the following areas to reduce employee resistance
to change initiatives
 Avoid surprises
 Promote genuine understanding
 Set the stage for change
 Make the change tentative
Evaluation of the Change
o Evaluation is conducted to not only gain insight into how the change itself
might be modified to further increase organizational effectiveness, but also to
determine whether the steps taken to make the change should be modified to
increase organizational effectiveness the next time the steps are used
o Watching for signs that indicate further change is necessary is also key


Change and Stress:
This section provides a discussion of stress that arises from organizational change and
discusses the importance of studying and managing stress.



Defining Stress
o Stress is the bodily strain an individual experiences as a result of coping with
some environmental factor
o Results in wear and tear on the body
o In organizations, the wear and tear comes from the body’s subconscious
mobilization of energy when the employee is confronted with new
organizational or work demands
The Importance of Studying Stress
o Stress can have damaging psychological and physiological effects on
employee health and their contributions to organizational goal attainment
o Stress is a major cause of employee absenteeism and turnover
o Stressed employees can affect safety of coworkers and the public
o Stress represents a significant cost to employers
 Estimates put the cost at $150B per year
Managing Stress in Organizations
o Understanding How Stress Influences Worker Performance
 Figure 11.5 illustrates the relationship between worker stress and the
level of the worker’s performance
 Extremely high and extremely low levels of stress tend to have
negative effects on production
 A certain amount of stress among employees may even increase
worker production – it is the too little or too much stress that is
generally disadvantageous for the organization because it tends to
decrease production
o Identifying Unhealthy Stress in Organizations
 Most stress responses are hard, if not impossible, for managers to
observe and monitor
 High blood pressure – Pounding heart – Gastrointestinal
disorders
 Observable signs include:
 Constant fatigue – Low energy – Moodiness – Increased
aggression – Excessive use of alcohol – Temper outbursts –
Compulsive eating – High levels of anxiety – Chronic worrying
 Helping Employees Handle Stress
 Stressor – environmental demand causing people to feel stress
 Common when organization change includes layoffs or firings
 Workplace Bullying – individuals being isolated or excluded
socially and having their work efforts devalued
 Management strategies to help prevent the initial development
of unwanted stressors
o Create an organizational climate that is supportive of
individuals
o Implement stress management courses
o Make jobs interesting
o Design and operate career counseling services
Change and Conflict:
This section defines conflict managers may encounter as a result of planning and making
organizational changes.

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Conflict – the struggle that results from opposing needs or feelings of two or more
people
Generally results when managers make changes that threaten employees or create
conflicting views between employees and managers
Conflict does sometimes result in a positive outcome for the organization
Strategies for Settling Conflict
o Figure 11.6 illustrates techniques managers can use for handling conflict
o Compromising
 Parties involved in the conflict settle on a solution that gives both of
them part of what they wanted – neither managers or employees get
exactly what they initially wanted
o Avoiding
 Managers simply ignore the conflict
 May be okay when one assumes all conflict is bad, but perhaps is most
appropriate when the potential conflict will not limit organizational
goal attainment
o Forcing
Managers use their authority to declare that conflict is ended through
their authority to do so
 “I make the assignments, and your job is to do what you’re told.”
 A relatively fast way to end conflict, which may be the best in an
emergency
o Resolving
 The most direct – and sometimes the most difficult – way to manage
conflict is to work out the difference(s) between managers and
employees
 Managers and employees listen to each other’s viewpoints in a sincere
effort to understand rather than argue
 May see a Win-Lose Conflict or Win-Win Conflict

Virtuality:
This section identifies a specific, commonplace type of organizational change being made in
modern organizations. The second defines a virtual organization, discusses degrees of
virtuality in organizations, and describes the virtual office.



Defining a Virtual Organization
o Virtual Organization – Network Corporations or Modular Corporations
o Uses information technology, Internet, and hardware and software tools that
enable managers to go beyond traditional boundaries
Degrees of Virtuality
o Virtual Corporation – An organization that extends beyond boundaries and
structure of a traditional organization by connecting all parties through email and other Internet-related vehicles such as videoconferencing
o Virtual Teams – Groups of employees formed by managers beyond
boundaries and structure of traditional organizations
 Connect through the organization’s intranet or the Internet to
communicate
o Virtual Training – Extends beyond boundaries and structure of traditional
training
 Instructs employees via Internet-assisted learning materials
The Virtual Office
o Defining a Virtual Office
 Work arrangement that extends beyond boundaries and structure of
traditional organizations
 Figure 11.7 illustrates the continuum of alternative work arrangements
available in a virtual office
 Occasional Telecommuting
 Hoteling
 Tethered in Office
 Home-Based, Some Mobility
 Fully Mobile
o Reasons for Establishing a Virtual Office
 Cost reduction
 Increase productivity
 Redesigning of employee jobs for efficiency and effectiveness
o Challenges of Managing a Virtual Office
 More difficult to create a desired organizational culture
 More difficult to integrate employees into the fabric of the
organizational culture
 More difficult to supervise employees
 More difficult to communicate with employees