Unit VIII IOP
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Work in the 21st Century
Chapter 14
Organizational Theory,
Dynamics, and Change
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Module 14.1: Conceptual & Theoretical
Foundations of Organizations
• Organization
• Group of people who have common goals &
who follow a set of operating procedures to
develop products & services
• Organization needs strategic planning
• Buying from & selling to the unorganized
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Sopranos as an “Organization”
• Organizations are a
way of life – in
virtually all sectors of
life.
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Organization as Integration
• Successful organizations are able to
integrate many different organizing
forces
– e.g., HR, finance, marketing, production
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Classic Organizational Theory
• Emphasized architecture of organization
rather than processes of operation
• Bureaucracy as the ideal form
• Methods of describing an organization:
– Division of labor
– Delegation of authority
– Structure
– Span of control
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Figure 14.1: Organizational Charts for
Large & Small Span of Control
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Classic Organizational Theory (cont’d)
• Constrained in 2 ways
– Assumed there was one best configuration for
an organization
– Assumed that organizations affected behavior
of their members but not the other way around
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Human Relations Theory
• Added human element to study of
organizations
• McGregor’s Theory X & Theory Y
– Theory X: Managers believe subordinate
behavior has to be controlled
– Theory Y: Managers believe subordinates are
active & responsible
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Human Relations Theory (cont’d)
• Growth perspective of Argyris
– Suggested there is natural developmental
sequence in humans that can either be enhanced
or stunted by organization
– Proposed growth is a natural & healthy
experience for an individual
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Contingency Theories
• Woodward described 3 org. types:
• Small batch organization
• Large batch & mass production organization
• Continuous process organization
– Span of control varies systematically by
type of organization
– Introduced concept of technology
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Contingency Theories (cont’d)
• Lawrence & Lorsch
– Mechanistic organizations
• Depend on formal rules & regulations
• Small span of control
– Organic organizations
• Less formal procedures
• Large span of control
– Identified the department as an important level for understanding organizations
Contingency Theories (cont’d)
• Mintzberg
– 6 basic forms of coordination:
1. Mutual adjustments based in informal
communication
2. Direct supervision
3. Standardization of work processes
4. Standardization of KSAOs necessary for production
5. Standardization of outputs
6. Standardization of norms
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Contingency Theories (cont’d)
• Tavistock Institute’s Sociotechnical
approach
– Uncovered # of dramatic changes in
social patterns of work that accompany
technological change
– Includes joint consideration of
technology & social patterns
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Figure 14.2: Systems
View of an Organization
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Figure 14.3:
Systems Theory
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Recent Approaches
• Resource theory: Pfeffer
– Organization must be viewed in context
of connections to other organizations
– Key to organizational survival is ability
to acquire & maintain resources
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Conclusions About Theories of
Organization
• Motivation metaphors can be applied to
organizational theories
• Discrepancy b/w many org. theories &
current organizational interventions
– Six Sigma, TQM, MBO, & lean production
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Module 14.2: Some Social
Dynamics of Organizations
• Climate & culture
– Brief history of climate
• Lewin’s autocratic vs.
democratic climate
• Recent suggestion that
multiple climates exist
within any organization
– Service climate
– Safety climate
Table 14.1: Some Typical Questions
about Organizational Climate
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Culture
• Term culture introduced to address
issues of value & meaning of actions in
org’s not encompassed in climate
• Measuring culture in organizations
• Organizational Culture Inventory (OCI)
• Effects of culture “clash”
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Climate & Culture
• Integration of concepts
– Climate is about context in which actions occur
• Created at lower levels of organization
– Culture is about meaning intended by &
inferred from those actions
• Created & communicated from higher levels of
organization
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Organizational Climate & Culture
From the Multicultural Perspective
• When cultures clash
– Models under which multinational corporations operate
• Ethnocentrism
• Polycentrism
• Regiocentrism
• Geocentrism
– Important for multinational corporations to acknowledge existence of different cultures
P h o to
L in
k /G
e tt
y I
m a g e s
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Socialization & Concept of
Person-Organization (P-O) Fit
• Organizational socialization
– Process by which new employee becomes
aware of values & organizational
procedures
– Recruitment as socialization
• Compelling research findings
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Organizational Socialization (cont’d)
• Socialization & P-O fit models
– Extent to which skills, abilities, & interests of
individual are compatible with job demands (person-
job fit)
– Broadened to include fit between person &
organization (P-O fit)
– Work adjustment model
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Three Stages of Socialization
Figure 14.4 The Three Stages of Socialization
Organizational socialization generally follows the three stages
summarized here; anticipatory socialization, which involves getting in;
the encounter stage, which in involves breaking in; and the
metamorphosis stage, which involves settling in.
SOURCE: Greenberg (2002).
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Schneider’s attraction-selection-
attrition (ASA) model
– Organizations attempt to attract and
select particular types of people
– Attrition occurs through direct or indirect
actions
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Figure 14.5:
ASA Model: Simplified Version
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Module 14.3: Organizational
Development & Change
• Organizational change
– Lewin’s 3-stage process
1. Unfreezing: Become aware of values & beliefs
2. Changing: Adopt new values, beliefs, & attitudes
3. Refreezing: Stabilization of new attitudes &
values
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Episodic Change
• Infrequent, discontinuous, & intentional
• Embraced because it is focused, time
urgent, & minimizes feelings of uncertainty
• Often self-propagating
• Can be stressful & disruptive for employees
• Most commonly managed
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Continuous Change
• Ongoing, evolving, & cumulative
• More likely to be improvised rather than
intentional
• Lewin’s model needs to be reworked in this
environment
Freeze Rebalance Unfreeze
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Resistance to Change
• Barriers to change include:
• Economic fear
• Fear of unknown
• Fear of altered social relationships
• Structural inertia
• Work group inertia
• Threats to power balance
• Prior unsuccessful change efforts
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Large-Scale Organizational
Change Initiatives
• Total quality management (TQM)
– Emphasizes team-based behavior directed toward
improving quality & meeting customer demands
• Six Sigma systems
– Provide training in statistical analysis, project
management, & problem-solving methods to
reduce defect rate of products
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Large-Scale Organizational
Change Initiatives (cont’d)
• Lean production manufacturing
– Focuses on reducing waste in every form
– Just-in-time (JIT) production
• Detailed tracking of materials & production
• Draws both suppliers & customers into
organizational circle
– Often requires radical redesign of HRM
systems to be successful
John A. Rizzo/Getty Images
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Emerging Commonalities Among
Organizational Interventions
1. They are strategic
2. They are team centered
3. They are statistical
4. They are participatory
5. They are quality-focused