FINAL PAPER - Creating an Organizational Development Proposal

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The Changing Face of OD 10

Learning Outcomes After reading this chapter, you should be able to:

• Examine the emergence of the knowledge society and its implications for organizations, leaders, and OD consultants.

• Identify the challenges and opportunities presented by globalization and explain how OD can improve an organization’s ability to manage these challenges.

• Identify the implications of ethical OD practices for leaders and OD consultants.

• Discuss the future of OD.

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Chapter 2 featured a vignette about several companies that failed to change. As a result, their products became obsolete, and they lost their competitive edge. According to Newman (2010), these companies became obsessed with competing in the present and lost sight of the future. In the case of Blockbuster, not only did the company fail to anticipate the future, but it turned down the opportunity to buy Netflix, which now dominates the movie rental industry through Internet video streaming. Why did Blockbuster decide not to buy Netflix? At the time, Netflix was losing money (Graser, 2013), and Blockbuster’s management failed to predict customer preference for Internet-based access to entertainment. Graser (2013) explained, “Blockbuster chiefs lacked the vision to see how the industry was shifting under the video rental chain’s feet” (para. 1). When organizations fail to anticipate the future and change to accommodate it, they are at risk of los- ing market share or even going completely extinct.

The average life expectancy of a multinational corporation is approximately 20 years, which has fallen from about 60 years in the 1950s (Maubossin, Callahan, & Majd, 2017). Very few come close to the life expectancy of humans, which averages about 75 years. By 1983, one third of the companies listed in the 1970 Fortune 500 had vanished, either closing down or succumbing to acquisitions or mergers (de Geus, 1997). Given these statistics, information on preserving orga- nization longevity should be of interest to most companies that wish to survive. Technology is a disruptive force that is lethal to older companies. When was the last time you drove all over town looking for an obscure item to buy? Amazon is a good example of how people shop, purchase, and receive products today. The company’s ability to automate retail has been a significant dis- ruptor in the markets (Sheetz, 2017).

In his book The Living Company, Arie de Geus (1997) examined the factors that keep companies alive for centuries. The book is based on a previously unpublished study commissioned by the Royal Dutch Shell Group, a multinational oil and gas company where de Geus worked. The com- pany was formed in 1907 from the merger of two competing companies, Royal Dutch Petroleum and the Shell Trading Company of the United Kingdom. Incidentally, the word Shell in the com- pany name was derived from the fact that seashells were used for money at the time in the Far East. The previously unpublished Royal Dutch Shell study examined companies older than itself, i.e., those founded before the 1890s.

The Shell Group study defined a living company as characterized by four traits that bolster the organization’s ability to be nimble, change ready, and healthy:

1. Sensitivity to the environment. This trait represents the organization’s capacity to learn and adapt. As de Geus (1997) explained, “As wars, depressions, technologies, and political changes surged and ebbed around them, they always seemed to excel at keeping their feelers out, tuned to whatever was going on around them” (p. 6). This trait is also characterized by creating a sense of harmony between the company and its environment. It is essential in helping the organization change effectively as necessary.

2. Cohesion and identity. This trait is the organization’s ability to create a sense of belonging among its members that is essential for surviving amid change. Managers are generally promoted from within, and their priority is the health of the institution as a whole, other than during times of crisis.

3. Tolerance and decentralization. De Geus (1997) suggested that these traits are symptomatic of the company’s awareness of ecology: “its ability to build construc- tive relationships with other entities, within and outside itself ” (p. 9). Tolerance was

Section 10.1The Knowledge Society

selected as the most descriptive word, because decentralization is a modern orga- nizing concept. These companies were highly tolerant of activities on the margins of their business that were experimental and eccentric and stretched their possibilities for innovation.

4. Conservative financing. This trait captures the ability to carefully govern the growth and evolution of the organization and ensure there is cash on hand to have the flex- ibility and means to explore new ventures that are out of competitors’ reach.

What is remarkable about de Geus’s (1997) findings is how they parallel conditions for creat- ing and sustaining change in organizations: learning and adapting, commitment to people and the health of the organization as a whole, tolerance of exploration of new ideas, and careful financing to support exploration. Where have you observed these traits in your experience with organizations?

This book has explored how organization development uses planned change to help individuals, groups, and organizations become more effective and productive. It has examined the dynamics of change and the major phases of planned change according to the action research process: planning, doing, and checking. It has also looked at some of the interventions that arise as a result of engaging the OD process at the individual, group, and organization levels.

In the final chapter of this book, it is worth reminding ourselves that remaining rel- evant and competitive for the long haul requires ongoing learning, reflection, and commitment to change. OD can help orga- nizations respond to shifting conditions in ways that keep them relevant, competitive, and healthy. Particularly, organizations need to be prepared to compete in the knowledge society and respond to a globalizing and changing work force. OD consultants can help organizations prepare for and respond to changing contexts by delivering quality consulting and observing OD ethics and values.

10.1 The Knowledge Society The social, political, economic, and cultural world is interconnected and global. The emer- gence of technology and dominance of the creation and sharing of learning is known as the knowledge society. Also referred to as the knowledge economy, the knowledge society has replaced the industrial society. “Knowledge societies are about capabilities to identify, pro- duce, process, transform, disseminate and use information to build and apply knowledge for human development” (Bindé, 2005, p. 27). Embracing the knowledge society helps organiza- tions develop what de Geus (1997) termed “sensitivity to the environment” (p. 9) in the open- ing vignette. This sensitivity is an organization’s capacity to learn and adapt.

istocksdaily/iStock/Thinkstock A key factor in promoting an organization’s long-term sustainability is its ability to build relationships with those inside and outside itself.

Section 10.1The Knowledge Society

This shift has implications for organization strategy, challenges, and interventions. Today, we have almost instant access to vast quantities of global information. Yet information is not knowledge. Converting information into knowledge requires critical thinking to distinguish useful from useless information, as well as new technologies to connect existing forms of knowledge with new forms.

According to Fedeli and Bierema (2020),

Learning is the process of acquiring knowledge through programmed instruc- tion, experience, study, or trial and error. Knowledge is ideas and skills attained through learning. Learning and knowledge are not synonyms. They are com- plimentary processes needed by both individuals and organizations so they can thrive. Learners and organizations do not necessarily meet their goals when learning occurs. Learning must translate into knowledge that is created and shared with others and applied to improve lives and organizations. (p. ix)

In developed nations, communications technology and the Internet mediate the knowledge society. Not everyone, however, has this access. The gap between those who have technology and the resources to use it and those who lack this access is known as the digital divide. “Although some may say the digital divide has been bridged, visiting impoverished inner-city, small rural, and violence-torn areas around the globe reveals scores of people who do not have access to electricity, technology, and the outside world” (King, 2010, p. 426). The Pew Research Center reported that 10% of U.S. adults do not use the Internet, with little change in the rate since 2014, despite governmental and social service efforts to encourage adoption in underserved areas (Anderson, Perrin, Jiang, & Kumar, 2019).

Opportunities and Challenges of the Knowledge Society The key challenges of the knowledge society include accelerated change, hypercompetition, and creating new knowledge (Adams, 2012). People are stressed trying to keep up with the impossible information explosion and continue learning.

Accelerated Change Earlier in this book, we drew on Heraclitus’s philosophy to underscore the adage that change is the only constant. OD helps an organization plan change so it can respond to the unex- pected and strategize for the future. Friedman noted in his 2007 book, The World Is Flat, that technological advancement has resulted in a reality in which

engines can now talk to computers, people can talk to people, computers can talk to computers, and people can talk to computers farther, faster, more cheaply, and more easily than ever before. And as that has happened, more people from more places have started asking one another the same two ques- tions: “Can you hear me now? Can we work together now?” (pp. 198–199)

What pressures have you felt in dealing with the deluge of information that comes at you daily?

Section 10.1The Knowledge Society

Hypercompetition In a global context, information overload puts increasing pressure on organizations to change quickly. Hypercompetition is typical when new markets or industries emerge, such as what occurred with smart devices and apps. Competition may be created through pricing, invading markets with better or newer products, or creating new alliances, such as when AT&T pur- chased DirecTV. New, innovative technology shifts the rules and creates competitive advan- tage and profits. These advantages are often short lived, however, because the competition works to keep up and ultimately innovates beyond the new product or service. Hypercompe- tition puts extreme pressure on organizations and accelerates the change process. Following a quality, ethical OD process is imperative in these situations.

Challenge to Create New Knowledge Needed and valued knowledge society competencies include the ability to deeply understand and synthesize information, effectively function interpersonally through soft skills such as teamwork, and engage in high-quality learning (Dumont & Istance, 2010). Chapter 9 dis- cussed organization learning and learning organizations as responses organizations make to an increasing knowledge society. When CEOs talk about increasing human capital, what they are really discussing is the capacity to generate and share knowledge through people. In what ways have you seen or experienced new knowledge creation?

Corporations are not the only organizations that have embraced the knowledge society and learning as a strategy. Schools aspire to become learning organizations (Senge, Cambron- McCabe, Lucas, Smith, & Dutton, 2012), and governments, nonprofit organizations, and cor- porations are coming together to solve social problems using learning strategically (Senge, Smith, Kruschwitz, Laur, & Schley, 2008).

Edwards (2020) traced the emergence of knowledge management, which took off during the 1990s. He defined it as being affected by people, processes, and technology and how they interact to generate the knowledge and tools within a system. Organizations can support knowledge building by embedding learning in their processes and practices—for example, integrating it into the performance management process, holding opportunities for employ- ees to share their knowledge and lessons learned, and reflecting on learning and knowledge generated as a regular process with projects and events that occur in the business. Orga- nizations can also provide opportunities for employees to showcase their knowledge with each other. Leaders can adopt a learning stance and ask employees to focus on learning and knowledge in day-to-day meetings and supervision. Culture also supports knowledge when the environment is supportive of errors and mistakes and creates opportunities to learn and grow from them.

Keeping Up With technological innovations and knowledge explosion comes the stress of trying to keep up with impossible volumes of information and the need to continue to learn. Information is at our fingertips most anytime and anywhere, making it impossible to keep pace. According to Petrov (2019), 90% of all data has been created in the last 2 years, and every person will

Section 10.1The Knowledge Society

generate 1.7 megabytes every second in 2020. It would take one person about 181 million years to download all of the data on the Internet. Today, Internet users produce 2.5 quintillion bytes of data daily, and there are 2.3 billion Facebook users. Big data will continue increasing in importance and help- ing organizations save money. A total of 97.2% of organizations are investing in big data and artificial intelligence. Even basic, routine transactions require new knowl- edge, such as paying automated parking meters, making an insurance claim, self- scanning groceries, checking in for a flight on a smartphone, or searching online for health information.

Becoming Lifelong Learners Lifelong learning is a self-directed process of seeking knowledge for personal, professional, or civic enhancement. It heightens social, emotional, mental, intellectual, community, spiritual, professional, and economic health. Lifelong learning is also the best defense against the over- whelming deluge of information that is available—and growing—on a daily basis. Because knowledge becomes increasingly obsolete as new information becomes available every sec- ond, how people learn and teach will likely have to change. It will be advantageous to develop more flexible approaches to learning new knowledge and to question existing knowledge. Lifelong learning will enable people to keep up, remain relevant, and contribute to relation- ships and the workplace.

How can you bolster your lifelong learning capacity? You can begin by committing to learning and approaching life with a learning mindset. You can build this mindset by becoming more curious about things and people. Pause and ask yourself questions such as these:

1. What did I learn from this experience? 2. What could I have done differently or better? 3. What can I learn from this person? 4. What will I teach others about this experience or challenge?

We have also introduced this approach earlier in the book as reflective practice. Taking time to stop and consider what you are doing or have just done can be a powerful teacher. Mak- ing time for learning is another strategy. Some companies encourage employees to dedicate part of their working hours to ongoing learning. Teaching others is another excellent way to bolster your own learning because it forces you to synthesize and organize your knowledge. Teaching can be done multiple ways, not necessarily in a formal classroom. You might teach through mentoring, coaching, projects, or meetings. Reading is also a valuable activity, and the range of topics is endless.

See Who Invented That? MOOCs to read about an innovative learning opportunity.

Ridofranz/iStock/Getty Images Plus Technological advances have promoted the emergence of the knowledge society, or knowledge economy.

Section 10.2Globalization and the Changing Work Force

The Role of the OD Consultant in the Knowledge Society OD consultants can play a range of roles when helping organizations address knowledge society challenges. Refer back to the characteristics of the living company presented in the opening vignette. You could apply those steps as OD interventions with clients to cope with the knowledge society: being sensitive to the environment and learning and adapting to it, promoting organization cohesion and unity in the face of change, building tolerance and con- structive relationships with multiple entities, and adopting conservative financing that helps govern and fund careful growth.

There are many other ways OD consultants help organizations cope with the knowledge soci- ety. One is to work with them to design ways to capture and share learning related to their processes and products. Another is to anticipate group and team dynamics issues that might arise, given the challenges of a knowledge society. Consultants can also help organizations plan ways to respond to technological and web evolutions, such as creating a social network- ing strategy or using collaborative virtual tools for meetings and training. Technology may also be able to assist change efforts through new communication, training, and meeting modes.

10.2 Globalization and the Changing Work Force Boundaries are more permeable than ever before. Goods and services cross borders and cul- tures easily. Your morning coffee may come from Colombia, your clothing may come from China, and the person processing your order may work at a call center in India. This exchange of goods and services across countries and cultures is called globalization.

International commerce has existed for centuries. What distinguishes today’s global market, however, is its speed and intensity, or its shift from connected to hyperconnected (Friedman, 2011). To survive, organizations must develop work teams able to collaborate virtually across borders and time zones. Globalization also challenges organizations to be accountable to workers and communities in distant regions, as well as to the global environment. Although global markets bring a wide variety of products and services to a large audience, their

Who Invented That? MOOCs A good example of the challenges and opportunities of a knowledge society is the development of MOOCs (massive open online courses). MOOCs provide learners worldwide with an oppor- tunity to build knowledge on a scale never before seen. A MOOC provides open access—it is available to anyone with an Internet connection who wishes to participate.

MOOCs combine traditional learning pedagogy such as streamed video, readings, and prob- lem solving with virtual pedagogy such as interactive user forums and web-based activities to facilitate learning and community among the participants. It remains to be seen if this free, open-access innovation will grow to become recognized as a valid educational option.

To learn more about MOOCs in which you can participate, check out this list of the “50 Most Pop- ular MOOCs of All Time”: https://www.onlinecoursereport.com/the-50-most-popular-moocs -of-all-time/.

Section 10.2Globalization and the Changing Work Force

drawbacks include environmental destruc- tion, pollution, and the exploitation of work- ers, including child labor. Such drawbacks have intensified pressure to hold corpora- tions accountable for their impact on com- munities and the environment. Given the pace and scope of globalization across national, social, political, economic, and cul- tural borders, it is becoming more incum- bent on organizations to advocate social responsibility and sustainability (Scherer, Palazzo, & Matten, 2010).

Growth of Outsourcing and Shift to Platforms Over Products The notion of globalization may call to mind the outsourcing of manufacturing to low-income, low-wage countries, or mega multinational corporations that operate worldwide with little accountability or regulation. Outsourcing is the transferring of portions of production to out- side suppliers as a means of cost reduction.

Outsourcing challenges how we define organization boundaries and our assumptions about work and organizations. Temporary, contract, and other contingent workers now carry out work that was once done only by full-time, permanent employees. Teams are quickly and easily assembled across global boundaries and just as easily disbanded when the work is finished. Work colleagues and customers are more diverse than ever before, which creates more opportunities for innovation and creativity but also miscommunication and misunder- standing. Expectations for productivity and results are high. These dynamics put pressure on employees and organizations. Consultants bring an understanding of the human dynamics of change and are attuned to the social costs and benefits of the organizational challenges that accompany globalization and outsourcing.

Additionally, the Internet has created a new organizational type: the platform (Burke, 2018). The platform is a virtual site for people who want to sell something to someone who needs it. eBay fits this example, as do Amazon, Uber, Twitter, Facebook, and LinkedIn. OD must grapple with more complexity in a digital world.

Growth in Cultural Diversity As the world seems to get smaller through globalization and the increased communication capacity afforded by technology, people are more aware than ever of the diversity of the world’s 7 billion people. The population is aging and growing, and many nations are chal- lenged with increased cultural and ethnic diversity, including the United States. According to the latest U.S. Census (Humes, Jones, & Ramirez, 2011), from 2000 to 2010, the Hispanic population accounted for 43% of the total population growth, Asians 43.3%, and African Americans 12.3% (Humes et al., 2011). Such demographic changes create both tensions and opportunities. Tensions arise as cultural and ethnic groups are faced with preserving their culture and language versus adopting the norms of the dominant culture. Opportunities to collaborate, innovate, and learn abound with these shifts.

metamorworks/iStock/Getty Images Plus Globalization is creating new opportunities to connect and collaborate around the world.

Section 10.2Globalization and the Changing Work Force

Although it is impossible to categorize all of the nuances of culture, some authors have attempted to highlight the range of cultural differences, such as Hofstede’s dimensions of culture (Hofstede, Hofstede, & Minkov, 1991). This work began in the 1960s with sur- vey research on attitudes and values of people in 40 different countries, with more recent research including 76 countries. Hofstede and colleagues (1991) distinguished six cultural dimensions known as power distance, uncertainty avoidance, individualism versus collectiv- ism, masculinity versus femininity, long-term versus short-term orientation, and indulgence versus restraint. The dimensions are summarized in Table 10.1. What dimensions have you noticed in cultures to which you belong and with which you interact?

Table 10.1: Hofstede’s dimensions of culture

1. Power distance

Power distance is the extent to which the less powerful members of organizations and institutions (such as the family) accept and expect that power will be distributed unequally. This represents inequality (more versus less), but defined from below, rather than from above.

Low power distance High power distance

Power distance scores are smaller for Anglo and Germanic countries.

Power distance scores are higher for Latin, Asian, and African countries.

2. Uncertainty avoidance

This dimension deals with a society’s tolerance for uncertainty and ambiguity and level of comfort with unstructured situations that are novel, unknown, surprising, or different from the norm.

Uncertainty avoidance Uncertainty acceptance

Uncertainty-avoiding cultures attempt to minimize the possibility of novel and unexpected situations by adopting strict laws, rules, safety, and security measures.

Uncertainty avoidance scores are higher in Latin countries, in Japan, and in German-speaking countries.

Uncertainty-accepting cultures tolerate opinions different from what they are used to. They adopt as few rules as possible. Religious and philosophi- cal views tend to be relativist and open to multiple interpretations. These cultures are emotionally reserved and contemplative.

Uncertainty acceptance is observable in China and in Anglo and Nordic countries.

3. Individualism versus collectivism

This is the degree to which individuals integrate into and identify with certain social groups.

Individualism Collectivism

Individualistic societies experience loose ties among individuals. People look after themselves and their immediate family members and expect others to do the same. Decisions are made with the good of the individual in mind.

Individualism prevails in developed and Western countries.

Collectivist societies are made up of people who form strong, cohesive in-groups from birth that often include extended families (with uncles, aunts, and grandparents). These groups provide protection and unquestioning loyalty to each other. Decisions are made with the good of the collective in mind.

Collectivism prevails in countries such as Japan, China, and Russia.

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Section 10.2Globalization and the Changing Work Force

Table 10.1: Hofstede’s dimensions of culture (continued)

4. Masculinity versus femininity

Masculinity versus femininity refers to the distribution of socialized and emotional roles between the genders. Traditional masculine qualities include being more assertive and competitive. Traditional feminine qualities include being more caring and modest.

Masculinity Femininity

Tendency toward more assertive, competitive quali- ties that can be exhibited by both women and men.

Masculinity is high in Japan and some European countries such as Germany, Austria, and Switzer- land. It is moderately high in Anglo countries.

Tendency toward more caring, modest values that can be exhibited by both women and men.

Femininity is high in Nordic countries and the Netherlands and moderately high in some Latin and Asian countries such as France, Spain, and Thailand.

5. Long-term versus short-term orientation

Long-term orientations are geared toward the future and creating conditions supportive of future generations.

Long-term orientation Short-term orientation

These cultures embrace pragmatic, future-oriented virtues such as saving, persistence, and adapting to changing circumstances.

Long-term orientation scores are highest in East Asia and moderate in eastern and western Europe.

Short-term-oriented societies embrace virtues related to the past and present, such as national pride, respect for tradition, preservation of “face,” and fulfilling social obligations.

Short-term orientation scores are high in the Anglo world, the Muslim world, Latin America, and Africa.

6. Indulgence versus restraint

The degree to which a culture is oriented toward immediate gratification of needs.

Indulgence Restraint

A culture permissive of relatively free gratification of basic and natural human needs related to enjoy- ing life and having fun.

Indulgence scores are highest in Latin America, parts of Africa, the Anglo world, and Nordic Europe.

A culture that shows restraint by suppressing gratification of needs. Strict social norms regulate behaviors around gratification.

Restraint is mostly found in East Asia, eastern Europe, and the Muslim world.

Source: Adapted from “The Seven Dimensions of Culture: Understanding and Managing Cultural Differences,” by the Mind Tool Content Team, n.d. (http://www.mindtools.com/pages/article/seven-dimensions.htm).

Growth in Age-Related Diversity Around the globe, the population is dramatically aging. Fertility has declined in industrialized nations as longevity has increased, creating an effect such that “in less than 10 years, older people will outnumber children for the first time in history” (Withnall, 2012, p. 650). Eleven percent of the world’s population was made up of older adults in 2010, but that number is expected to grow to 22% by 2050 (World Economic Forum, 2012). What are the conse- quences of multiple generations converging in the workplace (see Tips and Wisdom: Manag- ing Cross-Generational Relationships)? How is OD affected by generational differences? For example, rather than be overwhelmed by learning new technology, some older employees choose to leave for less-demanding jobs or take early retirement.

Section 10.2Globalization and the Changing Work Force

Multiple Generations Today’s U.S. work force represents five distinct generation groups that have different values and mindsets (Gesell, 2010; Hahn, 2011). When these multiple generations work together, conditions are ripe for misunderstanding each other (Ulrich, 2001). The five generational groups are generally accepted as the following (the dates are ranges that vary according to source):

1. traditionalists, born in or before 1945 2. baby boomers, born 1946 to 1964 3. generation X, born 1965 to 1976 4. millennials, also called generation Y, born 1977 to 1997 5. generation Z or post-millennials, born 1997-early 2000s

Multigenerational issues intersect with the knowledge society, globalization, technology, and cultural diversity. These dynamics affect the people who work in organizations and may cre- ate innovation, conflict, challenge, learning, and of course change due to different work styles, values, beliefs, attitudes, and culture. Table 10.2 compares certain characteristics of each group. Bear in mind that these are generalizations; that is, they are not descriptive of every person within the population. Each generation’s individuals have unique personalities, values, and life experiences. What is your generation? Do you agree with the following descriptions?

Table 10.2: Generational differences

Generation Characteristics

Information consumption and influences Work expectations

Traditionalists (also called the silent generation, the greatest gen- eration, veterans, or seniors)

• Diminishing in the work force due to retirements

• Solid and reliable • Value consistency • Change is challenging • Loyal

• Newspaper • Radio • Movie theaters

• Authority figures are to be obeyed

• Achievement depends on hard work, obeying rules

• Rewards for their commitment and loyalty

• Comfortable with delayed recognition and reward

Baby boomers • Largest group in work force

• Loyal with a strong sense of duty

• Optimistic • Known as workaholics • Grew up in nuclear

families • Tend to be managing or

are managed by people young enough to be their children

• Natural change agents • Strong work ethic

• Television • Visual news

stories about civil rights, Vietnam War, and Apollo 11 moon landing

• Team oriented • Empowerment • Seek personal

gratification and growth • Dynamic work

environment • Equate work with

self-worth • Arrive early, engage in

overtime as a moral obligation

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Section 10.2Globalization and the Changing Work Force

Table 10.2: Generational differences (continued)

Generation Characteristics

Information consumption and influences Work expectations

Generation X (also called the “sandwich gen- eration” due to its position between two large genera- tional groups)

• Smallest generation • Independent • Global thinkers • Self-directed • Techno-savvy • Latchkey generation • Self-sufficient • Adaptable to change • Self-reliant • Resourceful • Balanced

• Media • Expanding

technology • MTV and video

game era • Videocassette

recorder • Advent of home

computers during lifetime

• Appreciate and seek quality of life

• Prefer action over talk • Value balance, fun,

informality • Require individual

positive feedback and recognition

• Thrive on challenge • Want to lead and follow • Embrace self-governance • Prefer to work alone

rather than on a team

Millennials, gen- eration Y

• Will become largest generation

• Less than half of today’s work force

• Confident • Optimistic • Sociable • Accept multiculturalism • Value change • Open-minded • Strive to be part of

greater good • High sense of civic duty

and morality

• Technology • Instant

communication • Cell phones • Social networking

• Flexible work schedules • Life balance • Inclusivity • Can-do attitude • Multitasking • Goal oriented • Embrace teamwork • Have solid trust in

authority • Want to understand

“why” • Need ongoing feedback • Less adept at reading

nonverbal cues and understanding social context cues for appropriateness

Generation Z • 25% of the U.S. population

• Also known as “post-millennials”

• Post–9/11 • Risk averse • Diversity • Delay adult-like

responsibility • Collectivist • Value emotional

intelligence

• Digital natives • Pop culture

in decline due to ability to customize media consumption

• Participate in micro digital communities

• Independent • Entrepreneurial • Loyal • Open-minded • Determined • Responsible • Not trusting of peers • Comfortable with

situational identities

Source: Adapted from “Looking Beyond Generational Labels,” by L. Francis, 2019, (https://www.riversoftware.com/modern -mentoring/do-generational-differences-matter-in-mentoring/); “How to Lead When the Generation Gap Becomes Your Everyday Reality,” by I. Gesell, 2010, Journal for Quality and Participation, 32(4), 21–24; and “Managing Multiple Generations: Scenarios From the Workplace,” by J. Hahn, 2011, Nursing Forum, 46(3), 119–127.

Section 10.2Globalization and the Changing Work Force

An Aging and Shrinking Work Force An aging population has implications for the U.S. work force. It means that multiple genera- tions work side by side, which can create conflicts in work values and expectations. It also increases the need for talent management to ensure that people working later in life continue to be challenged.

Moreover, although a higher percentage of older workers is now staying in the work force, when the baby boomer generation begins to retire in large numbers, a significant labor short- age will occur. According to employment predictions published by the U.S. Department of Labor (2013), the country is facing a workforce shortage that will potentially slow economic growth in the next decade. Although annual economic growth is predicted to be 0.7%, the work force is predicted to grow at only 0.5% per year. Workers age 55 and older will make up more than 25% of the work force in 2022. The overall labor force participation rate will decline from 63.7% in 2012 to 61.6% in 2022, with declines predicted for both women and men. Job openings are predicted to be 50.6 million in total, with 67.2% of those jobs coming from replacement needs. A shrinking work force will require talent management, especially in the areas of attracting and retaining workers. Competition may drive wages higher and force organizations to offer more benefits and incentives in order to retain employees.

Opportunities and Challenges of Globalization Globalization has created several positive opportunities for organizations, countries, and citi- zens. First, it has accelerated economic growth, particularly in poor countries. It has helped bolster wages and redistribute wealth, while also improving product quality. Globalization has also helped reduce poverty; for example, between 1993 and 1996, the number of people living on less than $1 per day (absolute poverty as defined by the World Bank) declined from 432 million to 267 million (Griswold, 2000). Globalization has raised the standard of living and brought better medical care and education to remote and impoverished places. Global adoption of technological innovations has improved global commerce, communications, and cultural exchanges.

Tips and Wisdom: Managing Cross-Generational Relationships Multiple generations should not necessarily spell conflict. Generational differences contrib- ute to the rich diversity in organizations. Key steps for cross-generation relating include the following:

• Don’t dwell on differences or what the media says a certain generation values. Get to know each other! Generational stereotypes do not hold.

• Build multigenerational teams. • Build collaborative relationships. Partner to achieve the end goal. • Learn about your colleagues. What matters to them? How can you honor that? • Create opportunities for cross-generational mentoring, including reverse mentoring. All

generations have something to share and teach. • Consider life paths. Where are people and what are their needs? • Instead of assuming a certain generation wants “X,” ask people what they need.

Section 10.3OD Ethics and Values

Globalization has also created challenges. It has been blamed for increasing child and unfair labor practices, environmental destruction, and the gap between the world’s richest and poorest citizens. Within organizations, it has intensified expectations for workplace flexibility and virtual office arrangements, requiring different measures of communication and perfor- mance in these environments. Globalization is also creating new challenges for communicat- ing across languages, geographical borders, and cultures. This is also met by an increasing need to develop leaders who can be effective in multiple environments.

The Role of the OD Consultant in Globalization OD helps organizations respond to the challenges of globalization by using the action research process to identify problems and opportunities and to improve functionality, particularly in virtual communications and work practices. Group and team interventions, discussed in Chapter 8, can particularly help organizations manage the conflicts and differences that arise with a globalizing work force. See Tips and Wisdom: Leading in the Global Context.

OD interventions can also bolster capacity to facilitate multilingual written and verbal com- munication, including by recruiting and retaining a multilingual work force. Organizations will also be challenged to embrace cultural differences and find ways to create synergies on increasingly diverse work teams. OD consultants need to understand multiple cultural norms so they can help organization members work together effectively.

10.3 OD Ethics and Values Discussions of OD values, practices, and purposes have been ongoing since the field’s incep- tion (Minahan & Norlin, 2013). OD is founded on a humanistic ethic that seeks to develop individuals and the organization in positive, productive ways. This section examines ethics in the workplace, ethical guidelines for consultants, corporate social responsibility, and the role of OD consultants in upholding ethical practice. Burke (2018), in his reflections on the future of OD, underscored the sustaining commitment of a humanistic, do-no-harm ethos aligned with OD’s deep roots in the development and growth of all people in the organization.

Tips and Wisdom: Leading in the Global Context Globalization complicates leadership across national, geographical, and cultural boundar- ies and therefore requires organization leaders—and OD consultants—to think systemically about organization challenges and strategies. Consult the research journal International Jour- nal of Complexity in Leadership and Management to learn more about issues related to leading in a global context: http://www.inderscience.com/jhome.php?jcode=ijclm.

You can find more resources at the Global Policy Forum site: https://www.globalpolicy.org/ globalization/links-and-resources-on-globalization.html.

Section 10.3OD Ethics and Values

Ethics in the Changing Workplace In 2018, only 17% of Gallup Poll respondents rated business executives as having “high” to “very high” honesty and ethical standards, down from 22% in 2013 (Gallup, 2018). This indi- cates that both leaders and consultants need to work to ensure that ethical OD is in prac- tice and is perceived as such by employees. Serving as ethical role models is not easy in a workplace riddled with ethical dilemmas. Ethics challenges arise daily in organizations and become even more pronounced when change is in progress and employees are on edge. Typi- cal ethical dilemmas during change might include interpersonal conflicts, misunderstandings, differences in values or goals, or disagreements over the best courses of action when solving problems. You might observe behaviors such as withholding information, unfair treatment of employees, others taking credit for work that is not theirs, harassment, bullying, gossiping, or lying. What types of unethical behavior have you witnessed or experienced?

See Assessment: Which Ethical Type Are You? to explore your ethical tendency.

The Role of the OD Consultant in Upholding Ethical Guidelines Conducting OD inevitably raises ethical issues, and one of the consultant’s roles is to ensure that the process upholds OD ethics and standards. The OD code of ethics was presented in Chapter 1. Throughout this code, you can see OD’s humanistic orientation in the way it emphasizes quality of life, health, justice, dignity, win–win outcomes, holistic perspectives, and participative decision making: http://www.isodc.org.

Nekoranec (2009) views the OD consultant’s role as holding leaders accountable for ethical behavior so that interventions are ethical and legally acceptable. He noted it is important for OD consultants to ask leaders, “Will this course of action generate the right outcome?” (p. 6). De Geus (1997) noted that leaders should preserve the health of the whole organization dur- ing change, which is also an ethical imperative.

Nekoranec (2009) identified three themes for leaders’ ethical actions when making decisions: personifying espoused values, building relationships for harmony and purpose, and working for mutually beneficial solutions. OD consultants can ask leaders questions around each of these themes as they help clients navigate the ethics of change. Leaders can use some or all of these when making decisions.

Personifying espoused values is one way OD consultants and leaders set an example. As Brené Brown (2015) advocated, leaders should show their vulnerability. Employees will be

Assessment: Which Ethical Type Are You? Take the following assessment to understand what your ethical tendency is. Your ethical style is not permanent, so you can use this information to help you make more ethical decisions: https:// www.ache.org/about-ache/our-story/our-commitments/ethics/ethics-self-assessment.

Section 10.3OD Ethics and Values

watching to see if leaders live by their values and will be measuring the consistency between word and deed. Reflecting on and talking through ethical issues with honesty and frankness in meetings and public events and making a visible commitment to do the right thing and learn from mistakes are key ways to demonstrate values, in addition to being inclusive and equitable in decisions affecting organization members. This is similar to Block’s (2011) points about authenticity in OD practice—the ability to be blunt and direct about what is happening.

Building relationships for harmony and purpose is another process OD consultants use to ensure ethical practice. This occurs by being visible and approachable as well as supporting people and helping them bring out their best. This might involve reminding people that often their first response to a challenge may not be their best one and to stop, pause, and reflect on their intentions before responding. It is also important to show respect for each other and be transparent with information. Relationships are strengthened by trust, and trust is earned and takes time to develop, particularly for leaders.

The third way OD consultants ensure ethical practice is by working for mutually beneficial solutions so that the outcome is win–win for all stakeholders. This involves getting the facts about issues and challenges honestly and openly—this might be through seeking feedback or sharing assumptions about the problem from multiple perspectives. OD consultants might also want to seek multiple viewpoints to help clarify thinking about an issue. For example, asking only managers about problems in the organization may overlook key employee or

Consider This To reflect more on personifying espoused values, consider these questions:

1. How can you take on a role as an ethical vanguard? 2. What are visible ways you are living or can live your values? 3. How will employees perceive your values as you go through this change?

Consider This To reflect more on how well you build relationships that are harmonious and purposeful, con- sider these questions:

1. In what visible ways do I show people I support them? 2. What actions do I model that help others be their best? (encouraging, coaching, ques-

tioning, etc.) 3. When have I not been transparent enough with information, and how can I improve

that behavior? 4. What behaviors do I exhibit that hurt trust? Build trust? 5. How can I help employees achieve greater harmony and purpose as we go about this

change?

Section 10.3OD Ethics and Values

customer perspectives. Listening to employee feelings and thoughts is very important, par- ticularly during times of change so employees can express their concerns, have input, and feel involved. Ethical practice also means working within the bounds of the law. Finally, it is impor- tant that the organization be challenged to find the most effective solutions to its problems.

Nekoranec (2009) also identified two types of leadership styles that make achieving ethical outcomes more problematic for OD consultants. The first is bad leadership that will result in ineffectual outcomes or unethical leadership. Bad leadership is usually incompetent, rigid, and intemperate. In such cases, Nekoranec advises OD consultants to move on to other clients. The other type of problematic leadership style is ethically neutral. Although these leaders may support ethical OD interventions, they are generally not accustomed to ethical practice. They need to be reminded of ethical issues and the importance of ethical outcomes through coaching and direct nudging from the consultant.

Holding Ourselves Ethically Accountable as OD Consultants Before we can be both worker and organization advocates, we need to think about our own ethics and responsibilities. Cheung-Judge (2012) recommended that OD consultants own, refine, and integrate self-knowledge to remain sharp; they should do this by developing life- long learning habits, working through issues of power, building emotional and intuitive self- awareness, and committing to self-care.

Gellerman, Frankel, and Landenson (1990) presented ethical guidelines for OD consultants that are worth reflection and consideration. They noted that ethical OD practice is repre- sented by these guidelines:

1. Upholding responsibility to ourselves. This occurs when consultants carry out OD with integrity and authenticity, continually pursue self-development, and uphold individual interests in a fair and equitable way. It is difficult to advocate change for others if we are not actively engaged in changing and developing ourselves.

2. Being responsible for professional development and competence. Taking this respon- sibility means we are accountable for our actions, committed to our own continuous learning and development, and dedicated to maintaining our professional compe- tencies. In essence, as OD consultants, we have to practice what we teach!

Consider This To reflect on building mutuality in OD practice, consider these questions:

1. Who needs to be at the table to discuss the issues? 2. What questions do we need to ask ourselves about this problem? 3. What information do we need to make the best decisions? 4. What are the legal issues? 5. Is this a win–win outcome? 6. How will we ensure mutual benefit to all stakeholders as we go about this change?

Section 10.3OD Ethics and Values

3. Being responsible to stakeholders. This responsibility involves seeking the long-term well-being of OD stakeholders (such as employees, customers, community, and the environment) and conducting ourselves with honesty, responsibility, and integrity. This means asking tough questions and upholding the consulting role of authenticity with the client.

4. Being responsible to the profession. This responsibility entails contributing to the OD knowledge base, promoting sharing of knowledge and learning, and respecting other OD professionals.

5. Considering the consequences of our actions. This social responsibility is concerned with both the client and the larger social system; it involves carrying out OD with cultural sensitivity and social justice.

Practicing the OD code of ethics and following Gellerman et al.’s (1990) guidelines will posi- tion consultants to advance OD well into the future. See Tips and Wisdom: General OD Consult- ing Advice.

Corporate Social Responsibility: Promoting OD Values in a Changing Workplace OD plays a unique role in organizations: It is in a position to champion workers’ needs while also addressing organization needs that might range from recruitment to termination of the employment relationship. OD can also help the organization improve its processes, services, and products in a way that benefits all stakeholders and ensures organization health.

A key way to think about OD is as a process of improving human systems, as noted in the Organization Development Network’s (n.d.) Strategic Plan: “Organization Development is a field central to creating effective and healthy human systems in an inclusive world” (p. 3).

Tips and Wisdom: General OD Consulting Advice

Shepard (1975) offered the following advice for OD consultants: 1. Stay alive. 2. Start where the system is. 3. Never work uphill. 4. Do not build hills as you go. 5. Work in the most promising arena. 6. Do not use one when two could do it. 7. Do not overorganize. 8. Do not argue if you cannot win. 9. Play God a little. 10. Innovation requires a good idea, initiative, and a few friends. 11. Load experiments for success. 12. Light many fires. 13. Keep an optimistic bias. 14. Capture the moment.

Section 10.3OD Ethics and Values

Holding organizations accountable for the footprint they leave on people, communities, and the environment is known as corporate social responsibility (CSR). CSR movements often tout sustainability, the idea that the business uses renewable energy, has a minimal impact on the environment, and adopts humane workforce practices. CSR and sustainability are directly linked to globalization and concerns about how it exploits people and places (Bier- ema & D’Abundo, 2004).

Fenwick and Bierema (2008) interviewed human resource development (HRD) executives from high-profile Canadian and U.S. corporations to understand how they perceived their roles and challenges in implementing CSR. They found that participants’ engagement cen- tered on employee learning and promotion, employee ownership of development, and employee safety and respect. Overall, however, HRD appeared to be only marginally involved or interested in the firms’ CSR activities. Because OD falls under the HRD function in many organizations, these results should be cause to examine how OD interprets an organization’s commitment to CSR. Given the inherent risks of global commerce, individuals and organiza- tions are under more pressure to behave responsibly. OD’s humanistic philosophical orienta- tion, discussed at length in Chapter 1, positions the process to take a humane approach to organization change, making OD more relevant today than ever before.

See Case Study: Corporate Social Responsibility at CarCO.

Case Study: Corporate Social Responsibility at CarCO Lauren has enjoyed working at CarCO as the plant manager. She is currently being groomed for a pro- motion to oversee manufacturing operations at multiple plants. Lauren is looking forward to the challenge of having more responsibility and has several ideas she wants to implement, especially after attending a leadership development program over the past year. She has become involved with a local environmental nonprofit in her free time and has become increasingly concerned with environ- mental conservation and pollution control. As plant manager, she has implemented several conservation programs that lessened the plant’s carbon footprint.

As Lauren transitions into her new role, she is invited to a corporate strategic planning meeting to assess manufacturing capacity and future growth. During the meeting, some of the executives begin to discuss the logistics of expanding production at one of the plants that will fall under Lauren’s responsibility. One of the issues is wastewater treatment and whether the plant can comply with industry standards and still be productive. Although the company can easily comply with federal standards, the new industry standards are environmentally stricter and costlier to implement. The community and environmental groups are pressuring the company to adopt the higher industry standards; moreover, the executives acknowledge that, in the long run, this is probably the direction federal regulation will go.

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TommL/E+/Getty Images Plus Lauren, the plant manager, is trying to listen to executive feedback, assess productivity, and learn how to be compliant with environmental standards.

Summary and Resources

OD in the Future What is the future of OD? Cummings and Worley (2018) predicted it will be more widely adapted across a range of organizations and be more involved in supporting technological and managerial innovation. Burke (2018) argued that he sees no need to change the founda- tional principles, values, and methods on which the field was built, but that it is time for OD to expand beyond for-profit organizations into government, nongovernmental organizations, and nonprofits because all of these organizations are volatile and need help with change. OD will also take on more diversity, equity, and inclusion issues and focus more on ecological sus- tainability. OD has helped organizations adapt and change for more than 50 years. If OD is to replicate the success of the companies profiled by de Geus (1997), the field will need to find ways to continually learn and adapt, commit to sustaining the health of the organization and its workers, explore new ideas, and invest in new theories and practices that work. Given its humanistic value system, it is fitting for OD to find ways to help organizations meet mounting expectations for corporate social responsibility and sustainability.

OD’s key contribution is to help human systems learn and change (Minahan & Norlin, 2013). Is there a place for OD in the future? Absolutely. As Hamel and Breen (2007) asserted, for organizations to be healthy for the future, they need to be healthy for human beings. Creating healthy organizations for healthy human beings is how OD makes a difference.

Summary and Resources Chapter Summary

• The knowledge society, or interconnectivity of the social, political, economic, cultural and global world, has created information overload and technological innovation.

• The knowledge society presents both opportunities and challenges, including accel- erated change, hypercompetition, new knowledge creation, pressure to keep up, and the need to become lifelong learners.

Case Study: Corporate Social Responsibility at CarCO (continued) The discussion is quite lively, and it becomes clear that the majority are in favor of the lesser, cheaper wastewater treatment options that merely meet federal compliance. The issue is never resolved, and Lauren is left wondering what her options are and whether she should raise the issue or do what she thinks is right when the time comes for her to take over operations.

Critical Thinking Questions

1. What are the ethical issues in this case? 2. What would be the socially responsible response? 3. How might this ethical issue be handled from each of the four perspectives offered by

Pastin (2013): conformity, negotiation, navigation, and wiggling? 4. If you were brought in to work with Lauren and the executives around this issue, what

OD approaches would you recommend?

Summary and Resources

• Consultants can support organizations in the knowledge society by helping them find ways to capture and share learning and respond to new challenges using the action research process to solve problems.

• Globalization, the exchange of goods and services across boundaries and cultures, has prompted the growth of outsourcing.

• Globalization has heralded increased cultural diversity, including shifts in age- related demographics, multiple generations working side by side, and a shrinking work force.

• Challenges of globalization include increasing child and unfair labor practices, environmental destruction, and inequality. Opportunities presented by globalization include increasing technological innovation, communicating instantaneously, accel- erating economic growth, bolstering wages and redistributing wealth, and improv- ing product and service quality.

• OD consultants support globalizing organizations by helping them identify and capi- talize on globalization’s opportunities while meeting its challenges.

• OD ethics and values help uphold its humanistic stance. OD consultants can remind leaders to prioritize ethics during change.

• OD consultants should uphold the OD code of ethics and hold clients accountable for ethical leadership.

• Corporate social responsibility is the process of holding organizations accountable for their effects on people, communities, and the environment.

• In the future, OD will continue to create healthy organizations for healthy human beings.

Think About It! Reflective Exercises to Enhance Your Learning

1. Minahan and Norlin (2013) suggested that the current workplace context raises questions for OD practitioners such as these: How do we negotiate the needs of the individual versus the needs of the organization? What should OD’s value orientation be? What are the consequences of OD’s humanistic values? How can we be honest with clients about our concerns and anxieties about working in the current work- place context? Who gets to define what makes effective OD? Reflect on these ques- tions and formulate your own answers.

2. Think of a time when a failure to change affected your life. The failure can be yours or another person’s and can relate to a product, process, relationship, expectation, or outcome. What was the outcome? What did you learn?

Apply Your Learning: Activities and Experiences to Bring OD to Life

1. Go to the Miniature Earth site (http://www.miniature-earth.com) and write a one- page summary of issues you identify and their implications for workplaces and OD.

2. Check out a day in the life of an OD professional and her career path by reading this profile in OD. Chief Learning Officer Magazine features Tonya Cornelius, VP of learning and OD for ESPN: https://www.chief learningofficer.com/2013/02/22/ espns-top-play-learning/. What steps would you need to take to prepare for a similar career?

3. Go to the U.S. Department of Labor website (http://www.dol.gov) and search topics that interest you. What did you search? What did you learn?

Summary and Resources

4. Consider the case of the Sriracha hot sauce plant discussed in this article (http:// america.aljazeera.com/articles/2013/10/29/sriracha-lawsuitmaymakepricesjump report.html) and identify the key ethical and corporate social responsibility issues.

Additional Resources Media

• Summit on the Future of the Corporation (Arie de Geus is one of the speakers) https://www.youtube.com/watch?v=3iKdesdRojo

• Boomers, Gen X, and Gen Y: Multigenerational Work Force https://www.youtube.com/watch?v=If YjGxI6AJ8

Web Links

• Business Ethics Case Studies, resources on business ethics: https://www.scu.edu/ethics/focus-areas/business-ethics/resources/cases/

• Corporate Responsibility Magazine, a publication that focuses on sustainable, respon- sible business practices:

http://www.thecro.com

• Hofstede Centre, for more about Geert Hofstede’s work on culture: http://geert-hofstede.com

• Monthly Labor Review, U.S. Department of Labor, for reports on labor trends: https://www.bls.gov/pir/mlr.htm

• MOOCs: Top 10 Sites for Free Education With Elite Universities: http://bdpa-detroit.org/index.php/comittees/high-school-computer-competition

-hscc/29-education/57-moocs-top-10-sites-for-free-education-with-elite -universities.html

• Organization Development Network: The Essential Elements of OD Curricula: http://www.odnetwork.org/?page=EssentialElements

• Trompenaars and Hampden-Turner’s Seven Dimensions of Culture, another model for understanding culture:

http://www.mindtools.com/pages/article/seven-dimensions.htm

Key Terms corporate social responsibility (CSR) The movement toward holding organizations accountable for the footprint they leave on people, communities, and the environment.

digital divide The gap between people, communities, or countries with ready access to technology and the resources to use it versus those without technological access and knowledge.

Summary and Resources

globalization The exchange of goods and services across boundaries and cultures.

outsourcing Transferring portions of pro- duction to outside suppliers as a means of cost reduction.

sustainability The idea that business can be maintained by using renewable energy, having a minimal impact on the environ- ment, and employing humane workforce practices.