RE-ENERGIZING THE MATURE ORGANIZATION

Beatty, R.W. and Ulrich, D.O. (1991). Re-energizing the Mature Organization. Organizational Dynamics, Vol.20(1). 16-30

Organizations evolve through a life cycle with each evolving phase raising change challenges. The challenge for mature organizations is to renew the mind sets on which it has based its past success to meet the demand of the dynamic environment and recreate its culture consistent with changing customer requirements.

The purpose of this paper is to explore how mature firms can be re-energized; unique challenges of creating change in mature firms; detailed principles that can guide the change; identifying the leadership and work activities required to accomplish change. Here, hourglass analogy has been used to portray the organizational life cycle and challenges associated with each life stage.

The study focuses on the organizations in their maturity stage. These mature organizations face significant renewal change challenge where competitors offer similar products and services at comparable costs. The greatest effort involved is to replace the long established norms of stability and security with new values- speed, simplicity, unparalleled customer-service, self- confident and empowered workforce. These efforts at the renewal stage, still under way, will determine which firms will survive. The organization that fails this renewal change challenge enters the decline stage in which it loses its market share to firms that have renewed.

This study entails four broad principles, which if managers adhere to, the probability of renewal increases. These principles are based upon customer-centred activity, changing capacity, organizational activities- hardware and software, and empowered employees who act as leaders at all levels of the organization. Sooner or later organizations will have to face the renewal change challenge and then managers and leaders will have to help employees accept change in culture; shared vision and values and to enable them to be more customer-centric, cost conscious, adaptable and teamwork-oriented. The organization that overcomes the renewal change challenge moves to the other side of the hourglass where there is the ability to be re-energized.

The study proposes five steps of re-energizing mature organizations based on the proposed four principles. In the re-energised organization, the leader must be an encouraging model to commit energy and accept changed culture. The study advocates that leaders must also learn that sharing power enables employee empowerment, a salient demand of the changing environment where power and authority doesn’t come from position and status but from relationships, trust and expertise.

Submitted by: Angel Lakra, OBD group

Organizational Culture and Transformation

Armenakis, A., Brown, S., & Mehta, A. (2011). Organizational culture: Assessment and transformation. Journal of Change Management, 11(3), 305–328.

This paper explains the Organizational culture as a system of shared beliefs held by all members and created by the top leaders. Authors stated that organization’s culture can be described in terms of a cultural elements’ framework, comprising artefacts, espoused beliefs/values and underlying assumptions. Culture being an integral part of an organization, needs to be aligned with its environmental needs and if not, then change is required. The transformation consists of Change content and change process. For this, authors explained two models, one for creating Readiness for change, called the Readiness model and other for adoption of organisational change, called the Institutionalisation model. Readiness models suggest that organisations should first create readiness with the help of change agents through communicating the change message to the change recipients. This change message should influence the five beliefs of change recipients namely, Discrepancy, Efficacy, Appropriateness, Principal support and Valence. For that certain strategies are suggested in the model like, Persuasive Communication, Active Participation and Management of External Information. 

Lastly, Assessment is done that includes measurement of beliefs of change recipients to evaluate how ready they are to begin the implementation process. If recipients still resist change then more resources can be allocated to increase the efforts spend on one or more of the strategies. After creating readiness, next step is the institutionalization/implementation of change and for this, Institutionalization model is proposed. This model is used to plan and guide the Change Implementation. Seven strategies for change implementation are suggested in the model to reinforce the belief of change recipients. Strategies includes, Human Resource Management, Persuasive, Symbolism, Diffusion, Formalization, Active participation and Management of Internal and External Information. Then finally, the Assessment is done by evaluating the extent to which the change recipients have incorporated the values and behaviours associated with the transformation.  

The researchers analysed a case study of a family owned fertilizer company called PFC (Pursell Family Corporation) with the help of the Organizational Ethical Practices Audit (OEPA), open-ended questionnaire comprising major ethical practices that emerged from the analysis of the Baldrige award summaries. It was a company that successfully transformed its organizational culture in accordance with the Cristian principles. Changes embraced by the company explained in this paper are as follows; The mission statement included its obligations and responsibilities towards God and mentioned that the company will contribute at least 10% of its profits to charities, the selection, training and performance appraisal process was also altered in accordance with the Christian principles where candidates were assessed by the interviewer on the basis of their cultural fit and no formal performance appraisal was done by the company but whenever someone did something unacceptable or praiseworthy it was addressed immediately. Likewise, no reward was given to people for ethical behaviour because it was considered to be a part of life. Formal training for safety, finance and R&D was a part of the training programme and instead of formal ethical training, the devotionals were initiated by the company that anyone could attend, the company also acknowledged the rights of all the stakeholders and thus produced environment friendly fertilizer, followed technologically advanced procedures to ensure employee safety and contributed to charity on a regular basis. 

Therefore, it was concluded that the PFC was indeed an ethical company that transformed its culture successfully through the readiness and implementation model by changing and reinforcing the belief of the change recipients and this change process was analysed with the help of Organizational Ethical Practices Audit (OEPA).

Submitted By: Simrah Ahmed, OBD group

IN SEARCH OF EXCELLENCE by Tom Peters & Waterman

Various organizations continuously strive for getting best results in the market but even after following hardcore strategies only few company emerges as real winners. What factors make these few companies to get an edge over others, is very aptly described in this book. One of the classic work of Tom peters and Robert H. Waterman “IN SEARCH OF EXCELLENCE” is a widely quoted book on organizational effectiveness. 62 American companies were analyzed and their findings were reported with great insights. From the research of these companies an intelligent approach to organizing was developed known as Mckinsey 7-S framework. Companies which got qualified as excellent companies shared some very basic traits like best efforts for customer satisfaction, employees were treated as assets, organizational culture was flexible enough to account for required changes and at the same time was very strictly controlled. Eight such traits or principles were followed by these excellent companies and the same are very nicely described in this book. The findings of this book suggests that companies which were stamped as excellent prioritized simplicity over complexity in various organizational processes. This book is a must read to understand how these excellent companies performed simpler task in most effective way to turn them into their competitive strengths.

[Reviewed by Gautam Kumar who is a student of M Com at the Department of Commerce, Delhi School of Economics]

The Secret of joy in work is contained in one word – EXCELLENCE. To know how to do something well is to enjoy it. A Company can survive in the long run only when it is unique in whatever activities it performs. What sets great businesses apart? To answer this question Tom Peters & Robert H. Waterman, undertook a research project into the best run companies in the US. This was their search of excellence.

Their results provide a model of eight core principles for excellence that are narrated in a very simple and convincing way with tons of examples. Principles discussed in the book like ‘close to the customer’, productivity through people, benefitting from the management that is hands on and driven by values, considering employees as a source of quality make the book a good study of successful businesses as they continue to be very important even today. The authors are successful in proving  how crucial people are to business success. The model of excellence provides only the general framework but not the benchmark that will apply forever. Still it is one of the all-time classics of business management and a must read to get useful insights into the management theories and evolution.

 

 

[Reviewed by Kamaldeep Kaur Sarna who is a student of M Com at the Department of Commerce, Delhi School of Economics]