1.
Organizational Change & Culture
Matthew L. Eisenhard, Psy.D.
Week 12: Psychology for Business & Industry

2.
Life is About Changes
“It is not the strongest of the species that survive, nor
the most intelligent, but the one most responsive to
change.”
~Charles Darwin~
• Managing change is crucial to all elements of life
and business.
▫ An organization’s (or a person’s)
success or failure can depend on
how well they adapt to change.
▫ Sounds easy, but it is not!
 Example: Blockbuster Video.

3.
Types of Change
• Self-assessment 12.1 examines your openness to
change.
• Organizations are composed of four interactive
variables – they are the types of changes.
▫ Technological.
▫ Structural.
▫ Task.
▫ People.

4.
Technological Change
• Machines
▫ Any new type of manufacturing
equipment – especially computers.
• Automation
▫ Simplification or reduction of human
effort to do a job.
▫ Changes the types of jobs available.
▫ Increases the need for training and education for skilled
workers – while need for unskilled jobs declines.
• Process
▫ How a business changes raw material into finished goods,
services, or information.
▫ Management information systems (MIS) = a formal system
for getting, processing, and sending out information.

5.
Structural Change
• Structure of an organization means how it is designed.
▫ How departments are divided.
▫ The employee hierarchy.
• Important to change the structure to go with
technological changes.

6.
Task Change
• Tasks are the day-to-day things that
people do to perform their jobs.
▫ As technology and structures
change, so do people’s routine
tasks.
▫ People’s skills must change –
ongoing job training is necessary.
▫ Organizations need to be prepared
to hire new employees with the
necessary skills.

7.
People Change
• People are the most important resource in any
organization.
▫ People create, manage, and use technology.
▫ The social changes that go
along with the technical
changes affect people the most.
 Success depends on integrating
people and technology – a
sociotechnical system.

8.
Stages in the
Change Process
• DENIAL
▫ “Oh that can’t be true!” – it affects others, but not me.
• RESISTANCE
▫ Following the initial shock, reality hits, and the person
resists the change. “No I won’t do it!”
• EXPLORATION
▫ Once the changes are implemented, people start to
understand it more and try to see how they fit into it.
• COMMITMENT
▫ Once people are trained they will either embrace the
change, move and grow with it – or continue to be resistant.

9.
Resistance to Change
• People resist change for a number
of reasons.
▫ Want to maintain the status quo –
like things the way they are.
▫ Fear the unknown – uncertainty
makes us nervous.
▫ Anxiety about having to learn
something new.
▫ Fear of losing their jobs, feel threatened, out of control of
situation
• INTENSITY: acceptance – tolerance – resistance – rejection.
• SOURCES: facts – beliefs – values.
• FOCUS: self – others – work environment.

10.
Overcoming Resistance to Change

11.
Types of Resisters
• THE BLOCKER
▫ Refuses – ask what they want
to do instead.
• THE ROLLER
▫ Seems confused – be specific and detailed.
• THE STALLER
▫ Puts you off, says “later” – ask why not now?
• THE REVERSER
▫ Says “ok” but does not do it (passive-aggressive).
▫ If you like the change, why did you not do it like you said
you would?
• THE SIDESTEPPER
▫ Asks you to delegate it to someone else – say “no, I asked
you because…”

12.
Types of Resisters
• THE THREATENER
▫ Complies but says others will not like it
– tell them “let me worry about that part.”
• THE POLITICIAN
▫ Tries to get out of it by saying you owe them something –
say “ok, but I need this now.”
• THE TRADITIONALIST
▫ That’s not the way we do things here!
▫ “Well we need to make an exception and do it this way
now.”
• THE ASSAULTER
▫ Gets verbally abusive – you can refuse to tolerate it or try to
be empathetic.

13.
Change Models

14.
Lewin’s Change Model
• Kurt Lewin – 1950s.
• Three steps used to change
people’s behavior, skills, and attitudes.
▫ UNFREEZING
 Reducing forces that maintain the status quo.
▫ MOVING
 Learning new desirable behaviors, skills, and
attitudes.
▫ REFREEZING
 Establishes the new status quo through positive
reinforcement.

15.
Lussier’s Change Model
• Five steps to effective change.
▫ DEFINE the change.
 Clearly define what it is and the systems effects it will generate.
▫ IDENTIFY possible resistance.
 Be prepared for all the reasons people will resist.
▫ PLAN the change.
 Make a clear and reasonable plan – set a timetable.
▫ IMPLEMENT it.
 Give the facts – what effects it will have on the people.
 Involve the employees – ownership helps get commitment.
 Provide support – get input and help from employees – listen to their
concerns – provide training.
▫ CONTROL it.
 Follow-up to make sure it is working.
 If not make corrections where necessary to attain the desired
outcome.

16.
Organizational Culture
• Consists of the shared values
and assumptions of how its
members will behave.
▫ Success and shared experiences also shape
culture.
• Learned mostly by observing people and events
in the organization.
▫ New people need to learn and become integrated
into an organization’s culture to be a part of it.

17.
Five Ways to Learn the Culture
• HEROES
▫ Those who make outstanding contributions to the
organization.
• STORIES
▫ Often about the founders/heroes that make the
organization special – public statements and speeches can
also be stories.
• SLOGANS
▫ The organization’s philosophy statement(s).
• SYMBOLS
▫ Plaques – pins – jackets – caps – business cards – signage.
• CEREMONIES
▫ Awards dinners for top performers, etc.

18.
Important Definitions Related to
Organizational Culture
• Most effective organizational structure is
STRONG and POSITIVE.
▫ Strong = have clear values that are shared to the
extent of similar behavior.
▫ Positive = has norms that contribute to effective
performance and productivity.
▫ Weak = no stated values and do not enforce
behavior standards.
▫ Negative = experiences resistance and turmoil
that hinders effective performance.

19.
Organizational Climate
• The relatively enduring quality of the internal
environment of the organization as perceived by
its members.
• The employee’s perception of the atmosphere of
the internal workings of the organization.
▫ Important because employees’
perceptions are the basis for
their attitudes toward their
jobs – and their attitudes
influence their behavior.

20.
Morale
• Is a state of mind
based on attitudes
and satisfaction
with the organization.
▫ Can vary at different levels within the
organization.
▫ Commonly measured on a continuum ranging
from high to low based on 7 dimensions of
climate.

21.
7 Dimensions of Climate
• STRUCTURE
▫ Constraints – rules – regulations – policies and procedures.
• RESPONSIBILITY
▫ Degree of control over your own job (autonomy).
• REWARDS
▫ Degree of being reinforced or punished.
• WARMTH
▫ Degree of satisfaction with human relations on the job.
• SUPPORT
▫ How much help you get and the level of cooperation.
• ORGANIZATIONAL IDENTITY & LOYALTY
▫ Degree to which employees identify with and feel loyal to.
• RISK
▫ How much risk taking is encouraged.

22.
Organizational
Development (O.D.)
• Ongoing process of change
used as a means of improving
the organization’s effectiveness
in solving problems and achieving its goals.
▫ A Change-Agent is a person responsible for an
O.D. program.
 Training = process of developing necessary skills to
perform the present job.
 Development = process of developing the ability to
perform both present and future jobs.

23.
The Training Cycle – 5 Steps
• DO A “NEEDS” ASSESSMENT
▫ Who needs training and what kind.
• SET GOALS
▫ What will they be able to do at end of training.
• PREPARE FOR THE TRAINING
▫ Decide what methods of training are best.
• CONDUCT THE TRAINING
• MEASURE AND EVALUATE THE RESULTS
▫ A “follow-up” to see what has been learned –
performance appraisal.

24.
Performance Appraisals
• Ongoing process of evaluating employee job
performance.
▫ Typically after someone is hired (during and after
their training) and on a quarterly, bi-annual, or
annual basis.
▫ Two objectives:
 Development of the employee.
 Evaluation of the employee.

25.
More on Steps 2 & 3
• STANDARDS
▫ Describes performance levels in the areas of quantity,
quality, time, and cost.
• COACHING
▫ Refer to past feedback.
 What were they supposed to do?
▫ Describe current performance.
 Give specific examples of needed changes.
▫ Describe desired performance.
 In detail and why it is important – more training.
▫ Get a commitment for change.
 Must be a willingness to change/improve.
▫ Follow-up.
 Include positive reinforcement and how follow-up will be done.

26.
Survey Feedback
• An O.D. technique that uses questionnaires to gather
data that are used as the basis for change.
▫ Commonly used to measure climate.
• Six steps:
▫ Preliminary planning to develop survey.
▫ Questionnaire is given to all members of organization.
▫ Data analysis is conducted.
▫ Change agent gives results to management.
▫ Management evaluates and discusses with employees.
▫ Correction active plans are developed and implemented.

27.
Force Field Analysis
• Technique that diagrams:
▫ Current level of performance.
▫ Forces that hinder change.
▫ Driving forces toward change.
• Particularly useful for group problem solving as it helps
people to visualize problems and solutions.

28.
Team Building
• An O.D. technique designed to help
work groups operate more efficiently.
▫ Typical agendas vary according to the
change agent and needs of the
organization – but usually include the
things we have discussed about team
development.
• Goals of team building:
▫ Clarify goals and personal responsibilities.
▫ Identify obstacles/problems in the way.
▫ Develop team skills.
▫ Determine preferred style of teamwork.
▫ Use talents/strengths of all team members.
▫ Develop open/honest/trusting relationships.

29.
Team Building Program Agenda
• Climate Building
▫ Change Agent develops trust and openness.
• Process & Structure Evaluation
▫ Team decides it’s ideal norms.
• Problem Identification
▫ Team identifies weak/strong areas.
• Problem Solving
▫ Priorities are set.
• Training
▫ To address the new skills needed.
• Closure
▫ Summary – set follow-up – commitments.

30.
Global Differences in Change
• Individual Based Cultures
▫ Concerned more about helping themselves.
▫ More likely to resist change if it does not directly benefit
them.
▫ Overall they value change and the ability to deal with
change positively.
• Slower to Change Cultures – Value Tradition More
▫ Asian countries and some Middle Eastern.
• Collective Based Cultures
▫ Tend toward improving the team effort.
▫ Japan, Mexico.
• Respond More to Power
▫ France, China, India.

31.
Chapter Summary
• 4 Types of Changes
• Resistance to Change
• Change Models
• 2 Dimensions of Organizational
Culture
• 7 Dimensions of Organizational
Climate
• 5 Organizational Development
Techniques
• The Training Cycle
• 5 Steps of Performance
Appraisals
• The Coaching Model
• Relationship between Org.
Culture, Climate, and
Development
• CLIMATE
▫ Values and assumptions of
the ideal environment.
• CULTURE
▫ Shared values and
assumptions of the actual
internal environment.
▫ Culture informs climate.
• DEVELOPMENT
▫ Vehicle used to change
culture and/or climate in
search of improvement
toward the ideal.