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10 OD and the Future

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Learning Objectives

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, 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) explains, “Blockbuster chiefs lacked the vision to see how the industry was shifting under the video rental chain’s feet.” When organizations fail to anticipate the future and change to accommodate it, they are at risk of losing market share or even going completely extinct.

The average life expectancy of a multinational corporation is 40 to 50 years (de Geus, 1997). 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. Given these statistics, information on preserving organization longevity should be of interest to most companies that wish to survive.

In his book The Living Company, Arie de Geus (1997) examines 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 The book is based on a previously unpublished study commissioned by the Royal Dutch Shell Group, a multinational oil and gas company where de Geus worked.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 company 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 company 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) explains, “As wars, depressions, technologies, and political changes surged and ebbed around them, they always seemed to excel at keep- ing 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 envi- ronment. It is also 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) suggests that these traits are symp- tomatic of the company’s awareness of ecology: “its ability to build constructive rela- tionships with other entities, within and outside itself ” (p. 9). Tolerance was selected as the most descriptive word, since decentralization is a modern organizing 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 flexibil- ity and means to explore new ventures that are out of competitors’ reach.

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Section 10.1Emergence of the Knowledge Society

What is remarkable about de Geus’s (1997) findings is how they parallel conditions for creating 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 level.

In the final chapter of this book, it is worth reminding ourselves that remain- ing relevant and competitive for the long haul requires ongoing learning, reflection, and commitment to change. OD can help organizations 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 workforce. OD consultants can help organizations prepare for and respond to changing contexts by delivering quality consulting and observing OD ethics and values.

10.1 Emergence of the Knowledge Society The social, political, economical, 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.

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.

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A key factor in promoting an organization’s long- term sustainability is its ability to build relation- ships with those inside and outside itself.

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Section 10.1Emergence of the Knowledge Society

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).

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?

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.

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Section 10.1Emergence of the Knowledge Society

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 team work, 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 organi- zations that have embraced the knowl- edge society and learning as a strat- egy. Schools aspire to become learning organizations (Senge, Cambron-McCabe, Lucas, Smith, & Dutton, 2012), and governments, nonprofit organizations, and corporations are coming together to solve social problems using learn- ing strategically (Senge, Smith, Krus- chwitz, Laur, & Schley, 2008).

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 Schilling (2013), information doubles every 12 months, soon to be every 12 hours. Even basic, routine transactions require new knowledge, such as paying automated parking meters, 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, spiri- tual, professional, and economic health. Lifelong learning is also the best defense against the overwhelming deluge of information that is available—and growing—on a daily basis. Since 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.

Darrin Klimek/Photodisc/Thinkstock

Technological advances have promoted the emergence of the knowledge society, or knowledge economy.

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Section 10.1Emergence of the Knowledge Society

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.

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 opportunity to build knowledge on a scale never before seen. An 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 problem 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 top ten list: http://www.bdpa-detroit.org/portal/index.php/comittees/high-school-computer -competition-hscc/29-education/57-moocs-top-10-sites-for-free-education-with-elite -universities.html.

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http://www.bdpa-detroit.org/portal/index.php/comittees/high-school-computer-competition-hscc/29-education/57-moocs-top-10-sites-for-free-education-with-elite-universities.html

Section 10.2Globalization and the Changing Workforce

10.2 Globalization and the Changing Workforce 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 “con- nected to hyper connected” (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 environ- ment. Although global markets bring a wide variety of products and services to a large audience, their drawbacks include environmental destruction, pol- lution, and the exploitation of workers, including child labor. Such drawbacks have intensified pres- sure to hold corporations accountable for their impact on communities and the environment. Given the pace and scope of globalization across national, social, political, economic, and cultural borders, it is becoming more incumbent on organizations to advocate social responsibility and sustainability (Scherer, Palazzo, & Matten, 2010).

Luciano Lozano/Moment/Getty Images

Globalization is creating new oppor- tunities to connect and collaborate around the world.

Take Away 10.1: Emergence of the Knowledge Society

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

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

• 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.

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Section 10.2Globalization and the Changing Workforce

Growth of Outsourcing

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.

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.

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.

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Section 10.2Globalization and the Changing Workforce

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 Power distance scores are smaller for Anglo and Germanic countries.

High power distance 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-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 acceptance 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 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.

Collectivism 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.

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

Masculinity is high in Japan; in some European countries like Germany, Austria and Switzerland; and moderately high in Anglo countries.

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

Femininity is high in Nordic countries and Nether- lands and moderately high in some Latin and Asian countries like France, Spain, and Thailand.

(continued)

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Section 10.2Globalization and the Changing Workforce

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 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 orientation 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 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.

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

What dimensions have you noticed in cultures to which you belong and with which you interact?

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).

Multiple Generations Today’s U.S. workforce represents four 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 four generational groups are (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; and 4. the millennials, also called generation Y, born 1977 to 1997.

Multigenerational issues intersect with the knowledge society, globalization, technology, and cultural diversity. These dynamics affect the people who work in organizations and may create innovation, conflict, challenge, learning, and of course change due to different work

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

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

Section 10.2Globalization and the Changing Workforce

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.

Table 10.2: Generational differences

Generation Characteristics

Information consumption and influences Work expectations

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

• Diminishing in the workforce 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 workforce

• Loyal with a strong sense of duty

• Optimistic • Known as

workaholics • Grew up in nuclear

families • Tend to be manag-

ing 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 grati-

fication and growth • Dynamic work

environment • Equate work with

self-worth • Arrive early, engage

in overtime as a moral obligation

Generation X (also called the “sand- wich generation” due to its position between two large generational 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

(continued)

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Section 10.2Globalization and the Changing Workforce

Generation Characteristics

Information consumption and influences Work expectations

Millennials, generation Y

• Will become largest generation

• Less than half of today’s workforce

• 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 read-

ing nonverbal cues and understanding social context cues for appropriateness

Source: Adapted from Gesell, 2010, and Hahn, 2011.

What is your generation? Do you agree with the descriptions?

Tips and Wisdom

Gesell (2010) offered some OD interventions that help avoid or minimize intergenerational conflict:

• Facilitate open dialogue among the generations. OD consultants are usually skilled dialogue facilitators and can help organizations learn how to have multigenerational conversations. When leaders understand generational differences, they can lead the different groups according to their needs and expectations.

• Help organization members explore generational differences through formal OD interventions in which each generational group shares information about its history. Types of information might include: 1. historical events of the generation; 2. trends, people, and popular culture of the time; 3. key values of the generation; 4. key challenges of the generation; 5. perceptions of other generations; 6. benefits and challenges of working with other generational groups; and 7. things they wish other generations knew about them.

• Several of the team-building and conflict-management interventions discussed in Chapter 8 would also be effective for working with multigenerational groups.

Table 10.2: Generational differences (continued)

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Section 10.2Globalization and the Changing Workforce

An Aging and Shrinking Workforce An aging population has implications for the U.S. workforce. 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 are now staying in the workforce, 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 workforce is predicted to grow at only 0.5% per year. Workers age 55 and older will make up more than 25% of the workforce in 2022. The overall decline in the labor force participation rate will be 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 com- ing from replacement needs. A shrinking workforce will require talent management, espe- cially 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.

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 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 workforce.

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Section 10.3OD Ethics and Values

OD interventions can also bolster capacity to facilitate multilingual written and verbal commu- nication, including by recruiting and retaining a multilingual workforce. 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.

Take Away 10.2: Globalization and the Changing Workforce

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

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

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

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

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.

Tips and Wisdom

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

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http://www.inderscience.com/jhome.php?jcode=ijclm

Section 10.3OD Ethics and Values

Ethics in the Changing Workplace

In a 2013 survey, only 21% of Gallup Poll respondents rated business executives as having high ethical standards (Pastin, 2013). This indicates that both leaders and consultants need to work to ensure that ethical OD is in practice and perceived as such by employees. Serving as ethical role models is not easy in a workplace riddled with ethical dilemmas. Ethics chal- lenges arise daily in organizations and become even more pronounced when change is in progress and employees are on edge. Typical 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?

Pastin (2013) identified different ways people handle ethical issues at work. These include:

1. Conformity. Conformists follow rules and do not question authority figures. They do not want to rock the boat. Although conformists might be perceived as always doing the right thing, they might also look the other way in the presence of unethi- cal behavior by individuals higher up in the organization hierarchy. Conformists may experience ethical conflicts in organizations that lack strict rules and clear conse- quences for not following them.

2. Negotiation. Negotiators make up rules as they go about organization change. When confronted with a questionable situation, such as a colleague handling personal matters on company time, negotiators will take a wait-and-see approach to see if the consequences of the colleague’s behavior worsen or affect them negatively. Negotia- tors experience ethical conflicts when they are required to make decisions without guidelines, because they change the rules according to what seems easiest at the time.

3. Navigation. Navigators follow an internal compass to guide their actions when confronted with unethical behavior. They usually have an innate sense of right and wrong and rely on it. They are willing to make unpopular choices by following this moral compass. Navigators can be natural leaders and earn their colleagues’ respect and confidence. Navigators tend to succeed in most organizations and will leave those they believe to be unethical.

4. Wiggling. Wigglers do not follow a moral compass. They take the route that gives them the most advantage. Motivated by self-interest, wigglers will engage in what most would perceive as unethical behavior, such as lying, if it will help them gain favor with a supervisor or avoid conflict with a colleague. Wigglers get into trouble when others regard them as dodging ethical issues to protect themselves.

Assessment: Which Ethical Type Are You?

Take this 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.

http://www.healthethicstrust.com/otjet

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http://www.healthethicstrust.com/otjet

Section 10.3OD Ethics and Values

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 acco-untable for ethical behavior so that interventions are ethical and legally acceptable. He notes it is important for OD consultants to ask leaders, “Will this course of action generate the right outcome?” De Geus (1997) notes that leaders should preserve the health of the whole organization during change, which is also an ethical imperative.

Nekoranec (2009) identified three themes for leaders’ ethical actions when making decisions. 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. These themes include:

1. Personifying espoused values a. Taking on a role as ethical vanguard b. Acting with integrity to do the right thing c. Reflecting on courses of action d. Speaking honestly and frankly about issues e. Learning from the past f. Leading inclusively g. Serving as a role model of values h. Showing and explaining emotions: OD consultants might ask clients, “How will

employees perceive your values as we go about this change?”

2. Building relationships for harmony and purpose a. Supporting people and helping them bring out their best b. Respecting others c. Sharing information d. Earning trust in leadership e. Maintaining a visible profile and being approachable: OD consultants might ask

clients, “How will your employees achieve greater harmony and purpose as we go about this change?”

3. Working for mutually beneficial solutions a. Getting the facts honestly and openly b. Seeking counsel to clarify thinking c. Knowing the legal parameters d. Listening to employees’ feelings and thoughts e. Negotiating the information-gathering process f. Challenging the organization to find a more effective solution: OD consultants

might ask clients, “How will you help employees achieve mutually beneficial outcomes as we go about this change?”

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http://www.isodc.org

Section 10.3OD Ethics and Values

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) recommends that OD consultants own, refine, and integrate self-knowledge to remain sharp; they should do this by developing lifelong learning habits, working through issues of power, building emotional and intuitive self-awareness, and committing to self-care.

Gellerman, Frankel, and Landenson (1990) present ethical guidelines for OD consultants that are worth reflection and consideration. They note that ethical OD practice is represented by:

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!

3. Being responsible to stakeholders. This responsibility involves seeking the long-term well-being of OD stakeholders (such as employees, customers, commu- nity, 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.

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Section 10.3OD Ethics and Values

Practicing the OD code of ethics and following Gellerman, Frankel, and Landenson’s (1990) guidelines will position consultants to advance OD well into the future.

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.

Tips and Wisdom

Shepard (2006) 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.

Tips and Wisdom

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).

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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.

Case Study: Corporate Social Responsibility at CarCO

Lauren has enjoyed working at CarCO as the plant manager. She is currently being groomed for a promotion 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 environmental 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 more costly 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 would go.

(continued)

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Section 10.3OD Ethics and Values

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?

Case Study: Corporate Social Responsibility at CarCO (continued)

OD in the Future

What is the future of OD? Cummings & Worley (2009) predict it will be more widely adapted across a range of organizations and be more involved in supporting technological and man- agerial innovation. OD will also take on more diversity and inclusion issues and focus more on ecological sustainability. 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) assert, for orga- nizations 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.

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Summary and Resources

Take Away 10.3: OD Ethics and Values

• OD ethics and values help uphold OD’s 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.

Summary and Resources

Chapter Summary • The knowledge society, or interconnectivity of the social, political, economical,

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.

• 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 workforce.

• 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.

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Summary and Resources

Think About It! Reflective Exercises to Enhance Your Learning 1. Minahan and Norlin (2013) suggest that the current workplace context raises ques-

tions for OD practitioners, such as: 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 current workplace context? Who gets to define what makes effective OD? Reflect on these questions and formulate your own answers.

2. Think of a time when a failure to change impacted 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?

3. Review this article on General Motors’ disastrous ignition switch recall and identify the key ethical issues: http://www.nytimes.com/2014/03/25/business/carmaker -misled-grieving-families-on-a-lethal-f law.html?_r=0.

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 an OD professional and her reflections on her path and work: Profile in OD: Chief Learning Officer Magazine features Tonya Cornelius, VP of Learning and OD for ESPN: http://clomedia.com/articles/view/espn-s-top-play-learning.

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?

4. Review the Organization Development Network: The Essential Elements of OD Cur- ricula: http://www.odnetwork.org/?page=EssentialElements.

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

Additional Resources

Web Links

Business Ethics Case Studies, resources on business ethics. http://www.web-miner.com/busethics.htm

Corporate Responsibility Magazine, a publication that focuses on sustainable, responsible business practices. http://www.thecro.com

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

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http://www.nytimes.com/2014/03/25/business/carmaker-misled-grieving-families-on-a-lethal-flaw.html?_r=0

http://www.miniature-earth.com

http://clomedia.com/articles/view/espn-s-top-play-learning

http://www.dol.gov

http://www.odnetwork.org/?page=EssentialElements

http://america.aljazeera.com/articles/2013/10/29/sriracha-lawsuitmaymakepricesjumpreport.html

http://www.web-miner.com/busethics.htm

http://www.thecro.com

http://geert-hofstede.com

Summary and Resources

Monthly Labor Review, U.S. Department of Labor, for reports on labor trends. http://www.bls.gov/opub/mlr/2013/article/overview-of-projections-to-2022-1.htm

MOOCS: Top 10 Sites for Free Education with Elite Universities. http://www.bdpa-detroit.org/portal/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

Trompenars Seven Dimensions of Culture, another model for understanding culture. http://www.mindtools.com/pages/article/seven-dimensions.htm

Vanderbilt Center for Ethics, a good collection of case studies. http://www.vanderbilt.edu/CenterforEthics/cases.html#business

Media

Summit on the Future of the Corporation (Arie de Geus is one of the speakers)

https://www.youtube.com/watch?v=3iKdesdRojo

The Power and Promise of Diversity: SAP

https://www.youtube.com/watch?v=0P9M-1eEQFM

Boomers, Gen X and Gen Y: Multigenerational Workforce

http://youtu.be/RGNiXMlLzO8

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.

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.

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http://www.bls.gov/opub/mlr/2013/article/overview-of-projections-to-2022-1.htm

http://www.bdpa-detroit.org/portal/index.php/comittees/high-school-computer-competition-hscc/29-education/57-moocs-top-10-sites-for-free-education-with-elite-universities.html

http://www.odnetwork.org/?page=EssentialElements

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

http://www.vanderbilt.edu/CenterforEthics/cases.html#business

https://www.youtube.com/watch?v=3iKdesdRojo

https://www.youtube.com/watch?v=0P9M-1eEQFM

http://youtu.be/RGNiXMlLzO8

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