Teaching Notes

_Teaching Note

Case Teaching Notes

for

Organization Development & Change

188 Instructors ManualTeaching Notes 277

185Teaching NoteKenworth Motors

Purpose of the Case:

1. To explore entry and contracting issues in an OD process.

2. To understand practice issues in OD consultation. Placement in the Course:

This is the first case in the text and should be used fairly early in the course. It is designed specifically to look at entry and contracting issues.

Overview of the Case:

The OD consultant receives a telephone call from Robert Denton, plant manager of Kenworth Motors who was referred by a sailing friend who was a colleague of the consultant. Denton has held his job for eight months and believes things are generally going well, but has a sense things could be better. He invites the consultant to visit him and discuss his situation. The consultant does a little research about the company prior to the meeting but was thoughtful about what he wanted his emotional and professional posture to be. During the meeting, Denton describes that his plant and its employees get along fine, work well together and do a good job. Yet, he contends that things nag at me that I cant put my finger on..we havent jelled together as a team quite like Id hoped. The consultant asks more questions but the answers from Denton reveal nothing indicating a problem. At this point the consultant offers to independently confirm how things are going in the plant through employee interviews. He explains that this approach in itself may impact the organization, possibly raise tensions and even perhaps cause problems. Denton responds by asking about other options. The consultant suggests a weekend retreat for the management team including Denton. Denton expresses interest and the consultant quickly calculates his fees in his head and shares them with the client. He says that the content of the retreat would be somewhat flexible and that Bob Denton would have to trust him. Denton quickly agreed to the retreat weekend. The OD consultant and he proceeded to select a weekend for the event.

Teaching Strategy: (30-45 minutes questions and discussion)

1. Ask students to discuss the entry activities that occur in this case. How does the OD consultant prepare for the first meeting? Have students think of different ways the consultant may have prepared for the initial meeting.

2. The case describes in detail the discussions between the consultant and Denton which were meant to clarify the organization issues. In what ways were these discussions effective or ineffective for the OD practitioner? Are there other questions that might have been asked to clarify organizational issues?

3. The case describes how the consultant and Denton determined future consulting activities. In this contracting phase, have students discuss how mutual expectations, time and resources and ground rules were determined for the project. How would they have done it differently?

4. In this case, the OD consultant brings up the issue of trust with regard to retreat design. Why is this important and what impact will it have on retreat planning and implementation? 5. Why do you think Denton agreed so quickly to holding a retreat? What implications might this have regarding the intervention and addressing the real issues of Kenworth Motors.

Teaching NotePeppercorn Dining

Purpose of the case:

1. Review principles of entry and contracting

2. Critique data gathering and analysis strategies

3. Practice designing feedback processes

Placement in the course:

The Peppercorn Dining case is the second of several cases at the end of Part 2 in the text. The Part 2 chapters have described the fundamental processes of organization development, including entry and contracting, data gathering, data feedback, intervention design, and evaluation. The Peppercorn case is rich in detail around how a small group of consultants began an OD process and collected a broad range of data. It is a very action oriented case in that it ends at a natural breakpoint in the OD process a set of data has been gathered, needs to be analyzed, and a process for feeding back the date needs to be designed. It is a good case to give students a chance to think through these issues, propose some alternatives, and discuss the pros and cons of different approaches. (Note: If this type of case is appealing to the instructor, the BR Richardson Timber case in the Integrative Case section at the end of the text has a similar structure.)

Overview of the case:

Peppercorn Dining is a restaurant on the All American University campus and serves students who have purchased meal plans as well as cash-paying customers. A group of consultants from Square One Consulting was having lunch at Peppercorn when they bump into Drew, Peppercorns manager. One of the consultants, Erica, worked at Peppercorn as a student. Based on this chance meeting, Drew describes the situation at Peppercorn as he sees it and they eventually reach an agreement to do some operational auditing. After several days, the group of three consultants, Roger, Lynn, and Erica, collect data from managers at the restaurant, representatives from the parent dining organization for the university, and from various student, full time, and temporary employees. Their interviews cover various operations functions, including serving, the kitchen, cashiers, dishwashers, and supplies.

Toward the end of the first day of observations and interviews, Erica describes a new development, the announcement that the university will be constructing a new dining facility and that Drew will be the head of the new unit. The consultants complete their interviews and observations and must make sense of the data collected as well as think through the purpose and design of a feedback session where Drew will hear about their conclusions and recommendations.

Teaching Plan: (60 minutes)

There are a variety of issues to sort out in discussing this case. The questions at the end of the case ask students to a) comment on the quality and type of data collected as well as the process used, b) think about how the data might be analyzed, and c) design a feedback session.

Entry and Contracting (optional)

What do you think of the entry and contracting process?

Before addressing these issues specifically, it might be important to address the entry and contracting process. This particular engagement happened through a very informal process a chance meeting at the restaurant between the consultants and the manager. Before they knew it, the group had a project, facilitated at least to some extent by Ericas prior work as a student employee. The professor may want to comment on the extent to which this process is normal (e.g., OD consulting is often gained through word-of-mouth referrals vs. formal advertising) as opposed to unique (e.g., engagements usually dont just land in your lap). The instructor may also want to comment on the extent to which the consultants followed good entry and contracting processes as outlined in Chapter 4.

On the entry side, the consultants did a rather cursory job of clarifying the organizational issue, theres only some sense that things arent right. The relevant client may be Drew or it may be the All-American University dining center. This idea wasnt explored at all, and Drew hasnt even bothered thinking about whether these are the right consultants. The whole entry process is a bit suspect, but on the other hand, theres been no fatal errors either.

On the contracting side, theres less information in the case. There is the ethical issue of Ericas involvement and it appears that the consultants have at least thought about her potential bias.

Data Collection Process (15 minutes)

Are you satisfied with the quality and quantity of data collected by the consultants?

In terms of the data collection process, Chapter 7 lays out various criteria for good data collection processes. Students can be asked about the pros/cons of the data collection process. The tricky part will be to separate out the nature of this process with the diagnostic/analytic process discussed next.

First, the rich case descriptions of the consultants interacting with the various Peppercorn members suggests that they were fairly consistent in establishing a diagnostic relationship with each person. In almost every interaction, they explain why they were there and ask for permission to ask some questions. Theres no mention of any confidentiality or anonymity for the participants, so thats an open issue.

The consultants use three of the four data collection methods interviews of various stakeholders, observations of operations, and unobtrusive measures in the form of mission and goal statements, printouts from the computer system, and so on. The consultants appear to have done a good job here.

Finally, the question of analysis is up for discussion. The consultants have not been very systematic in their observations and interviews. Other than, tell me about your job kinds of questions, it will be difficult to aggregate the interview results in any content analysis, for example, and there is no survey data to submit to a quantitative analysis. That leaves other, more qualitative techniques, such as force-field analysis. In this case, since it is a diagnostic process, the second issue of how the data might be analyzed comes down to what diagnostic model is driving the consultants thinking?

Data Analysis (30 minutes)

How will you analyze the data collected? How will you make sense of the situation at Peppercorn?

This should probably take a majority of the class period, since how the consultants see the organizational issues will, in part, determine how the feedback process will be designed.

Choosing a diagnostic/analytic model is no small issue. There is no evidence in the case that a particular diagnostic model is driving the data collection process (a potential problem), and there are at least two models that would work. First, the consultants could use an individual based model such as the one described in Chapter 6. For each job at Peppercorn, the consultants could ask what their data reveals about task identity, skill variety, task significance, autonomy, and feedback in the context of Peppercorns structure. But this is a more limited perspective and not as good a choice.

Second, and perhaps more relevant in this case, would be an organization-level diagnostic model such as the one presented in Chapter 5.

Inputs: Based on their initial discussion with Drew as well as data from the interviews, we can see that the labor market has gotten very tight. It is more and more difficult to find workers and in particular student workers. This tightened market has forced the dining services unit and Peppercorn to increase the pay rates twice (although with little apparent effect). In a related category, we also know that a union represents full-time employees. It is this labor shortage that is driving many of the dynamics of the case.

The primary customer, students with meal plans, suggests that there is little likelihood that price increases can be used to offset the labor scarcity. On a more general level, we know from data in the interviews that the food-service industry is known for its low wage levels and long and odd hours.

Design Components. The observation and interview data provides some information on each feature of organization design. In some cases, there is much data of high quality while in other cases the amount of data (and its credibility) is thin.

Strategy: The mission and goals for the universitys dining unit lays out their purpose and operating goals. There appears to be a broad interest in providing nutritious food, creating a good social and aesthetic atmosphere, and serving the economic needs of the university. The goals reflect this broad interest by addressing customer satisfaction, facilities quality, management excellence, financial management, alignment with the universitys mission, and industry leadership. There is little in the case suggesting that Peppercorns strategy is any different.

Peppercorn, according to Drew, is trying address the difficult labor market by providing an enjoyable place to work although the consultants note a certain disconnect between what is said (decentralized and participative) and what is practiced (more centralized, less participative) based on their observations and interview data.

Technology: The overall transformation process is moderately interdependent and fairly low on uncertainty. The key workflow issue seems to be the supply system. Supplies, in the form of food, aprons, cookware, and so on, are ordered through a computer system that isnt working very well and resulting in frequent outages of different items. Since this process sits at the front end of the transformation process, its ineffectiveness is a key source of problems for the kitchen and service staff. In some way, the whole of Peppercorn is held hostage by this computer system.

Once the raw materials have arrived, food is prepared sometimes as much as a day in advance according to meal plans and recipes that are well understood. [Although some of the cooks seem proud of their recipes and interested in creating new ones, do you really want people to be very innovative in this situation? In some ways, this conflicts with the situation.] The prepared meals are transferred to the serving line where customers (students) are provided with their food. One of the consultants notes that there was no portion control at this stage and that a considerable amount of customization existed as workers gave students a little more of some things or accommodated specific requests. After the meal, the leftovers, utensils and plates, and trash are fed into the dish room where plates and utensils are cleaned and recycled for use.

Other processes also exist but are also relatively low in interdependence and uncertainty, including order taking, cash exchange, hiring and staffing, and grievance handling.

Structure: A formal organization chart for both the university dining services and Peppercorn are presented in the case. Drews role is interesting because he leads two organizations Peppercorn as well as the Salt Mill and has a professional supervisor (Larry) that is assigned from the university dining organization. Larrys relationship with the different employees draws some attention from the consultants and there is a mostly negative perception of Larry and his skills.

The case also points out a rather complex set of employee relationships. There are full time employees (union- represented), full-time temporary employees (a non-union position that has been added to accommodate the problems associated with the declining numbers of student workers), and student labor. The students have their own management structure and supervise themselves as well as the full-time temporary employees (although these employees receive their training from the permanent staff) which has been the point of some contention. At best, it suggests that there may be two standards of work performance at play. At worst, there could be some very divisive resentment over preferential treatment.

Measurement Systems: There is no information presented about how employee work is measured (goals set, performance monitored and feedback), there appears to be no portion control on food served, and no financial information is presented. There is mention of a grievance process, but no indication of grievance activity levels. If the computer system problems are added into this category, there would appear to be a pretty big hole in the sophistication of this system.

Human Resource Systems: The interview data reveals a number of complexities in the way employees are paid through the union contract and the motivational aspects of that system. In the initial interview between the consultants and Drew, he describes how some workers can actually be incented to call in sick, for example. The case also mentions that wage rates have been increased twice in recent months to address the lack of student issues.

Alignment and Effectiveness: Roger reports that customer satisfaction is consistently positive with the one complaint being the heat inside the facility an apparent artifact of the dining room being built over the heating plant. There is no financial data presented, so we cannot comment on the profitability of the unit. There is, however, considerable data on employee satisfaction. There is a fairly consistent downward trend across many of the employees interviewed, although there is a high degree of tenure among many of the full-time employees. There is also fairly consistent data with respect to tensions between the different types of employees.

Within that effectiveness assessment, can we make any inferences with respect to alignment among the organization design features? The presenting problem in the initial conversation between Drew and the consultants was a hiring problem and that has certainly been confirmed, the question is why?

First, the strategy for Peppercorn does not seem clear. Other than some sense of doing the best we can with what we have, there are no clear goals for the restaurant and no clear sense of why people come there other than they have a meal plan. They are a fairly captive audience and theres not much in the way of competition for Peppercorn. Does this suggest a lack of external pressure that translates into all the things seemed pretty relaxed comments in the case?

Second, the computer system is a big problem, and probably not under Peppercorns control. The University dining unit probably programs and maintains the system. There is a potential big black hole here since we dont know how the system works. The one potential issue here is that it may not be the system; it may be Larry, so that has to be confirmed.

Third, how much of the tension in the restaurant is the result of the structure where students supervise adults. Understanding the rationale for this approach and what the alternatives are would be a fruitful conversation.

Fourth, and related to the strategy-- There appears to be very few measurement systems. How do employees know if they are doing well or poorly?

Data Feedback (15 minutes)

What is your plan for the feedback meeting? How will you feed back your analysis and what outcomes do you want from the meeting?

The feedback process will depend on a) the consultants analysis of the situation at Peppercorn, b) their objectives for the session, c) the amount of time they contract for, and d) how they want to position the information about the new dining facility and Drews impending departure.

One teaching tactic is to ask students for their opinions on how this session should be designed. What goals do they have for the session? How do they want to raise and position Drews transition vis--vis the issues at Peppercorn? A good debate of the pros and cons of different approaches can be useful in generating practical concerns.

Certainly, clarifying the upcoming move will need to be addressed fairly early in the process. Drews ownership of the diagnosis and any subsequent actions will depend vitally on his role in the organization. Perhaps he began this process as a way to leave a better legacy for the next person in his position? If so, how will he ensure a transition of the initiatives to the next manager? Perhaps hes just interested in the consultants opinions and plans no action? These would seem crucial to how much of the data is discussed and presented and in what form. The consultants might even call him before the meeting and have this clarified rather than waiting for the meeting itself.

Teaching NoteSunflower Incorporated


1. To allow students to critique a planned change process.

2. To understand the value of diagnosis prior to action.

Placement in the Course:

This is the third of six cases concerning the processes of planned organization change. Unlike Its Your Turn, the Sunflower case describes a complete intervention and its initial impact on the organization. It is suitable for both graduate and undergraduate discussion as the issues are straightforward. It is best used after Part II has been completed so that students can appreciate all of the factors that go into managing a planned change process.


The case describes the background and recent performance of Sunflower Incorporated, a distributor of snack foods and liquor. The president decides to create a new position and hires Agnes Albanese to fill it. Ms. Albanese's responsibilities include the monitoring and administration of purchasing and pricing decisions across Sunflower's regional offices. Early into her job, she decides to standardize pricing and purchasing procedures in order to control costs. The case then describes how she went about implementing her decision and the "non" results associated with her actions.

Teaching Strategy (60 minutes):

1. Divide the students into small groups and ask them the following two questions.

A. Who can list the most mistakes made by Ms. Albanese?

B. Who can list the most reasons why she is getting no notices?

In essence, students can be allowed, under a "hindsight is 20/20" perspective, to criticize all of the things Ms. Albanese does wrong. In addition to having some fun, the obvious teaching point here is that organizations are complex social systems. Making changes without first considering alternative causes and consequences is foolhardy. Diagnosis is an essential aspect of planned change and promotes a "do it right the first time" philosophy.

C. Among the things she does wrong are:

No diagnosis of: Size of past price changes Size and number of past local purchase contracts Decentralized/autonomous decision making practices Her authority over regional offices No questioning of management belief about what's causing profit variation across the regions No apparent consideration of alternative monitoring procedures No personal relationship with purchasing officers No formal reporting relationship to purchasing officers No participation of purchasing officers in decision Formal, impersonal announcement of change

D. Several possible reasons she is getting no notices are:

Price changes may be less than 3%. Purchasing officers don't write contracts for over $5000. Purchasing officers have increased the number of contracts written so that no contract is over $5000. Purchasing officers simply ignored the change. Regional directors, not knowing Mrs. Albanese or resenting her intrusion, told purchasing directors to ignore the change.

2. In developing the above two lists, you can challenge students to identify the real reason Albanese received no notices. In other words, there's always at least two sides to every story. In any event, her lack of diagnosis prevents us from unraveling the causes of the problem.

The case also provides a good opportunity to get students to distinguish between facts and opinions. Students often read more into the case situation than the facts allow and then draw conclusions based on these "assumed facts."

3. What should she do now? It is helpful to get students to discuss the actions Albanese ought to take (assuming of course that the current situation is not satisfactory). In this way, the professor can emphasize that planned change process is cyclical. In essence, Ms. Albanese tried something, it didn't work as expected, and we therefore have some information upon which to proceed with the next round of planned change. This is, admittedly, given her too much credit, but the teaching point can be made easily. Among several possibilities, she can:

A. Perform a complete diagnosis of the regions using data supplied by the financial reporting system.

B. Interview regional managers about why the discrepancies in regional profits exist.

C. Solicit regional management's input regarding changes that might be made locally or changes that might appropriately be taken over by headquarters. Perhaps it's not controls on pricing and purchasing, but on quality standards for example.

Teaching NoteInitiating Change in the Manufacturing andDistribution Division of PolyProd


1. To apply several basic OD processes, such as diagnosis and managing change.

2. To gain a deeper understanding of an information management system, how it fits within an organizations design, and how it contributes to organization effectiveness.


The PolyProd case comes at the end of Part II where a host of traditional OD process have been described and discussed. The PolyProd case is well suited to the application of material from Chapter 10 on Leading and Managing Change as well as other basic OD processes, such as entry and contracting and diagnosis. The subject of the case, managing an information system also lends itself to a discussion of knowledge management and organization learning (Chapter 20) and the various plants located around the world opens the possibility of some international OD discussion as well, especially the subject of headquarter/subsidiary relationships.


Roberta Jackson, a project manager at PolyProd, strongly believes that the manufacturing procedures information system can be improved. The case first describes the manufacturing and distribution divisions background, organization, and culture. It then goes into a fairly detailed description of the divisions documentation process how it is structured, developed, and (ideally) used by the headquarters and remote locations. The case concludes by providing some information about how Roberta Jackson plans to proceed.

Teaching Strategy: (60 minutes)

1. Entry and Contracting (5 minutes)

A. The first question to address is how will Roberta position herself as the change agent or OD practitioner in this case. This discussion can be extensive or limited depending on the teaching objectives of the professorthe diagnostic and managing change issues are much more substantive. The case suggests that she will approach a division executive, Stewart Jones. Ask the students to develop a list of pros and cons for this approach and to enumerate the contracting issues.

Pros (+) and Cons (--)

+ Stewart Jones is a senior executive and probably has the horsepower to champion the effort.+ Senior sponsorship affords some political protection for Roberta.

-- Stewart Jones, like other executives, may not see the full problem.-- It will be difficult to demonstrate the benefit/cost proportions.

B. Contracting Issues

Roberta needs to be clear about the resources she will need to conduct the effort, including time from her regular duties as a project manager, other people to help her diagnose the system, commitment from Stewart Jones to protect her politically and see the effort through to the end, access to division documentation, assistance in getting remote location managers to discuss the systems current use, assistance from the divisions technical personnel, and perhaps some outside consulting resources.

She also needs to think through Stewart Jones requirements. What will he want? That will probably include some assurances of control; that nothing happens in the diagnostic phase without his knowledge. He is also likely to want some demonstration of the benefits of doing this work. Whats in it for him?

2. Diagnosis (25 minutes)

A. Understanding the documentation process and its relationship to the organizations effectiveness will not be an easy task. The student must first decide what level of analysis (organization, group, or individual job) and scope are to be applied. The answer is that it is organizational (it involves the headquarters organization as well as the foreign plants), but the scope is limited to the information systemor is it? This is an important question. The documentation system is only one part of the organizations design (and also includes the organizations structure, reward system, work design, and culture) and the case notes that the system has been greatly affected by PolyProds strategy. Any of these inputs or organization design elements could be a contributing factor to the documentation systems effectiveness. In particular, the case notes that Roberta believes the problem will be half cultural change and half systems improvement. However, any increase in scope is likely, at least initially, to be resisted by Jones. The problem is thorny enough without the increase in scope.

B. Certainly, the documentation system is the focal point of the diagnosis. Ask students how they will go about assessing the documentation process. What combination of interviews, questionnaires, observations, and unobtrusive measures will they use and why?

C. Based on the data in the case, students can perform a number of analyses, including a process map, political assessment, or cost/benefit.

Process Map: Take the data in the case and identify the key processes involved in the documentation system. They should include:

Document generation process Document retrieval process Document updating and revision process Documentation transfer process (moving the system from the headquarters plant where initial production occurs to the plants where volume production occurs) Training and development process (teaching the plant employees about the policies, procedures, and technical specifications that govern a manufacturing process this may have to be tailored to fit each local culture)

Political Assessment: Who holds power in this system?

StakeholderWhat do they want?

Headquarters OrganizationStandardization and efficiency of the system

PlantsAutonomy, local control, flexible and efficient system

Technical writersSome freedom in writing specifications and procedures

EngineersEfficiency in the system, quick access and retrieval

Quality controlStandardization, ability to enforce the standards at the plant level

Vendors/SuppliersAccurate orders and specifications, timely feedback

Others?

Cost/benefit: The issue here is what is process improvement worth? If the organization goes through the pain of revising the system, with all of the associated cultural and systems changes, what could the organization hope to gain? From the data in the case, it would be unreasonable to expect any numerical estimates. However, one can lay out an argument and use that argument (model) to drive a diagnostic process. For example, if quality is everything at PolyProd, one could collect data about:

Reject rates and associated rework costs Percentage of reject and rework costs associated with not following documented procedures Amount of time spent retrieving documents Current cycle times in the updating and revision process Number of times wrong parts or materials were ordered, the cost of replacement, and the cost of lost productivity Number of delays in customs and associated costs

3. Action planning and implementation (25 minutes)

After the diagnostic phase is completed, the data need to be fed back to the organization and action plans formulated. Depending on your objectives for the case, it might be worth spending some time discussing how particular types of data could be fed back to achieve ownership of the problem. Help students to see the relationships among the way the data is collected, the feedback process, and the likelihood of implementation.

A. Motivating change

To what extent is the PolyProd organization ready to conduct this change? What indicators exist to suggest that the organization is ready/not ready to engage in documentation systems improvement?

In general, the organization appears ill-prepared for change. Cultural resistance between headquarters and the plants (autonomy, decentralization, aversion to standardization, different cultural assumptions at foreign plants) would seem to be the most difficult problem. Assuming that Roberta got the go ahead for the effort, there are a number of issues to be addressed:

If data could be generated to support Robertas claim that the current documentation system is costing the organization substantial amounts of lost productivity that could help to create some sense of urgency.

What forms of resistance are likely to appear and how will they be addressed?

Type of ResistanceTactic to address resistance

Not invented here (especially at the foreign plants)Education

Fear of lack of incompetenceCreate psychological support

IncompetenceTraining

Local resistance to standardizationFlexibility in the system

Others?

B. Creating a vision

A clear sense of the future state is important. Creating a vision will require a thorough understanding of the existing culture(s). Any vision that violates core values of the organization will doom the change process to failure. Similarly, the vision has to be compelling enough to draw people into the process.

C. Developing political support

This would seem to be a critical element in the case. Robert Jackson and Stewart Jones each have different bases of power, but a clear assessment of the influence bases available to the headquarters organization and the plants is critical. The stakeholder analysis from the diagnostic section is a good starting point.

D. Managing the transition

What type of transition management process makes sense here? A steering committee with representatives from different stakeholder groups? A pilot process in headquarters to prove the new process and demonstrate its effectiveness? What kind of training should be offered?

E. Sustaining momentum

The current system of rewards supports autonomous action at the plant level; there is little incentive for the plants to cooperate or be motivated to improve the documentation system. Implementing an organization-level productivity reward may generate the interdependency necessary to incent the plants to help with the documentation process.

4. Wrap up and Conclusions (5 minutes)

The PolyProd case presents difficult issues. The case for change is not that strong and the resistance types and levels are quite high. In fact, in the actual case this is based on, the change effort failed. Politically, it was difficult to gain and sustain senior management support. Organizationally, the plants had enormous power vested in the culture. Together they were able to thwart the attempts.

Teaching NoteLincoln Hospital


1. An opportunity to contract to perform a diagnosis of human process issues at the interpersonal and group level in a large hospital system.

2. To critique the initial steps of the intervention chosen and offer different options

3. To assess the appropriateness of the intervention chosen and propose alternative OD interventions to address the presenting problems and the underlying issues raised in the diagnosis.

4. To assess the effectiveness of the intervention and propose next steps.

Placement in the course:The Lincoln Hospital case comes at the end of Part III covering a variety of Human Process Interventions at the interpersonal, group, and organization level. The other case is the Ben & Jerrys case. Both cases look at human process issues and lend themselves well to contracting, diagnosing, and implementation discussions. However, the Lincoln Hospital case is more oriented toward interpersonal intervention and the information in Chapter 12 is most relevant.


In the first few paragraphs, you are quickly introduced to a crisis situation at Lincoln Hospital. High turnover, scheduling issues, service delays, and a staff divided characterize some of the issues. It is described as a classic Prima Donna doctors vs. nurses and staff situation. It is a typical hospital (even academic) scenario of the battle between the highly educated specialists bringing in the work and doing the work and those supporting them. On the physicians side there is a newly appointed, representative chief of surgery, Don, who is at war with Mary, the 13-year veteran OR director. Mary has been working at Lincoln for 13 years, getting the job done with no complaints and no nonsense. Not only are Don and Mary at war but their respective staffs are described as being at odds as well.

A third party is invited in to intervene and interviews Don, Mary, and their respective staff. The interviews reveal a lot of finger pointing and a lot of blaming the problem on one person or one group (i.e., the physicians or the nurses). The practitioner decides the conflict between the leaders was the root of the more systemic problem. The intervention chosen was third party conflict resolution.

Meetings were conducted with Don and Mary separately to provide their answers to three questions to the third party. The questions were:1. What does he or she do well?2. What do I think I do that bugs him or her?3. What does he or she do that bugs me?

The mere act of answering the question seems to soften each towards understanding their part in the problem. Then they share their answers with each other with the practitioner present. Hearing the answer to the first question of what they did well softens them further and paves the way to resolve their differences. The two then agree on changes they were willing to make to their own behavior and practices and agreed on ways to support the other to be successful. Three VPs were present along with the practitioner and the two leaders and agreements were documented. Four periodic meetings were scheduled after this with all six involved to assess progress. Significant improvement was noted.

Teaching Strategy:

At the end of the case the students are assigned the following questions to direct analysis of the case:

1. If you had been called by Lincolns president to help resolve the problems described in the case, how would you have carried out the contracting and diagnosis stages? What would you have done differently than the OD consultant?

2. Is third-party intervention an appropriate intervention in this case? Other possible OD interventions?

3. How effective was the third-party intervention? Next Steps?

What is your opinion about the quality of the OD practitioners entry, contracting, and diagnosis activities?

This is a good chance to review the contracting and diagnosis phases presented in Chapters 4, 5, and 6. The goal of contracting is to make a good decision about how to carry out the OD process. Three key factors should be covered in any formal or informal contract.

a. Mutual expectations of the client relative to the outcome they are expecting and the consultant relative to their expectations of the client. You arent given much information here other than the focus being the two leaders and the practitioner was given full access to interview appropriate physicians, managers, and staff.b. The amount of time and resources allocated to the effort should also be agreed upon. For example, how long is the engagement, how much of the clients time will the consultant need, and how many resources will be allocated to the project. All we know is that the work was ongoing for at least a few months.c. Finally, ground rules should be set. There should be a statement of how the client and OD practitioner will work together (i.e., confidentiality, involvement in decisions, expert recommendations, etc.).

The situation can be diagnosed with any of the models presented in Chapters 5 and 6. With a bias toward being relevant, the organization level model is chosen here:

Inputs: The age-old doctor vs. staff scenario is a common result of the industry norm as to how hospitals operate. In this model, physicians are fairly independent and are the main source of patients (income) for the hospital. This gives them power and a degree of autonomy, however, the hospital staff also controls some of key resources. Changing this model would put a hospital at a competitive disadvantage relative to attracting good doctors. There is also an environmental issue. Area hospitals have been trying to recruit someone for the OR Director position for years with no luck. Firing the current OR Director would be very risky.

Design Components: The key element in this case is the structural systems that specify the level of coordination required between the doctors and nurses. This sets the context for the degree to which the conflict between the respective leaders of each area affects the rest of the organization.

Outputs: Organization effectiveness is the presenting problem. There has been a large turnover in the nursing staff with the new staff not being as skilled as the previous and short seven nurses. Doctors claim they are up to 50% less productive than before the turnover. There are major equipment, scheduling, and delay issues as well.

The initial interviews point to a conflict between the doctors and the nursing staff. In addition to this conflict there is a lot of buzz about the conflict between the two leaders of the respective groups; lots of finger pointing and blame. These leaders are in crucially interdependent roles, their relationship being the pinnacle of collaboration for the entire system.What other choices did the OD practitioner have besides a conflict resolution process? (Chapter 12 describes three general types of individual and group level interventions.)

Process Consultation This intervention focuses on interpersonal relations and social dynamics occurring in work groups. Typically, a process consultant helps group members diagnose group functioning and devise appropriate solutions to process problems, such as dysfunctional conflict, poor communication, and in-effective norms. The aim is to help members gain the skills and understanding necessary to identify and solve problems themselves. This would have been appropriate as the problems at the hospital were affecting the whole system. With conflict so prevalent and specifically, with the conflict being pinpointed to two people, it seems appropriate to settle that separately before addressing the more systemic problems.

Third-Party Interventions - Third Party interventions are a form of process consultation aimed at dysfunctional interpersonal relations in organizations. Interpersonal conflict may derive from substantive issues, such as disputes over work methods, or from interpersonal issues, such as miscommunication. Third party interveners help people resolve conflicts through such methods as problem solving, bargaining, and conciliation. This is the intervention chosen to first resolve the conflict between Don and Mary. It seems appropriate to address this first as it has tainted everyones view of the organization and what it needs.

Team Building - This intervention helps work groups become more effective in accomplishing tasks. Like process consultation, team building helps members diagnose group processes and devise solutions to problems. It goes beyond group processes, however, to include examination of the groups task, member roles, and strategies for performing tasks. The consultant also may function as a resource person offering expertise related to the groups task. This is a hard sell in the healthcare industry where time is so precious. If the time could be allotted it could be a helpful intervention to build trust between the two sides of the organization.

How effective do you think the third-party intervention was?

The intervention did a decent job in following the major criteria of an effective intervention. First, an effective intervention must fit the needs of the organization. The presenting problem was the conflict between Mary and Don and so there is a prima facie case of relevance. Second, good interventions are based on valid information about the organizations functioning, providing organization members with opportunities to make free and informed choices, and then gaining members internal commitment to those choices. In this case the practitioner interviewed a significant cross-section of the organization and ensured that he had buy-in from the focal people. The practitioner chose a classic OD intervention that in many ways gave the participants in the process considerable choice about being involved at all and the level or depth of their involvement.

Another important criteria for interventions is the extent to which the intervention transfers competence to organization members who should be better able to carry out planned change activities on their own following an intervention. There is probably a case to be made that Mary and Don now have a new tool that they can use and apply in similar circumstances. However, the overall tension between the two sides of the organization still exist and this intervention does not go very far in helping the rest of the organization learning to resolve their conflicts and work better together.

What should Lincoln Hospital do now?

As mentioned above, now that the conflict between the two leaders has been addressed the focus can move to the rest of the organization. Although the modeling of resolution at the top can have a significant effect on the rest of the organization, it is safe to say the there will still be conflict between the two groups and still unresolved issues around scheduling, staffing, and productivity in general.

Process consultation stands out as the most likely next step as it has more flexibility around time commitment. Its hard to get a significant portion of hospital staff and/or physicians to commit to lengthy teambuilding sessions. Looking ahead, students may also be encouraged to think about techno-structural and human resource process interventions as well.

Teaching NoteBen & Jerrys


1. An opportunity to diagnose human process issues at the organizational level in a large, publicly-owned organization with a popular brand and a chance to address these organizational issues in the context of a highly unorganized system.

2. To assess the appropriateness of the intervention chosen and propose alternative interventions based on the presenting problems and underlying issues uncovered in the diagnosis.

3. To design and propose next steps.

Placement in the course:The Ben & Jerrys case comes at the end of Part III which covers a variety of Human Process Interventions at the interpersonal, group and organization level. The other case is the Lincoln Hospital case. Both cases look at human process issues and lend themselves well to contracting, diagnosis, and implementation discussions. The Ben & Jerrys case is more oriented toward organization level interventions and the information in Chapter 13 is most relevant.


With a startup story described as a new-age entrepreneurs dream, Ben & Jerrys is a great springboard for discussion as people feel a familiarity with the brand and have experience with the product and its placement in the market. The company was started by two childhood friends, both college dropouts just wanting to make really good ice cream. They pride themselves on their funky, fun culture and socially responsible mission. Although they never intended to grow into a large corporation they doubled the first few years and continued with strong profits there after. As we are introduced to the system, the picture of an unorganized system and deteriorating productivity emerges. The presenting problem is that the companys external image of funk, fun, and love is out of sync with the atmosphere inside the company. Further investigation reveals poor (at best) communication, feuding between functions and organizational units, unclear lines of authority and responsibility, and a lack of operational control. The OD practitioner was commissioned to work with the founders, board of directors, management, and work force to undertake an OD effort to bring people, functions, aspirations, and directions together.

The case offers a good example of how OD interventions might be used to address these issues. Its also a chance to look at the progression from the presenting problems to the subsequent issues uncovered in assessing the organization. Discussion should address these issues and the appropriateness of the chosen intervention, possible alternatives, and next steps.

Teaching Strategy:

At the end of the case the students are assigned the following questions to direct analysis of the case: 1. Team building is typically used in OD to loosen up an over-organized system that is too rigid and bureaucratic. In this case, team building was aimed at providing structure to an under-organized system. In doing a diagnosis, what factors are important to consider in determining whether a company or team is over- or under-organized? What are the implications for planning an OD intervention?

2. Is team building a good way to launch an OD effort in this case? Other approaches?

3. What next steps would you recommend?

How would you diagnose the Ben and Jerrys (B&J) organization?

The organization design model from Chapter 5 is a useful framework for this discussion.

Input General Environment and Industry Structure. B&J seems to have a unique marketing edge that would be easy to imitate. The industry is competitive and the threat of entry high. The threat of substitute is high also if the funk and love appeal gives way to a different market amongst the newer generations. They allude to possible issues fulfilling existing marketing and franchise commitments due to low productivity.

Design Components - Technology, Strategy, HR Systems, Measurement Systems, Structure and Culture. The B&J strategy revolves around differentiation. In trying to make the best ice cream, supporting that with creative advertising, and a philanthropic attitude, the organization must support this mission. The case provides a lot of data about issues arising in both the structural and cultural areas. The system is highly unorganized and not keeping up with the growth of the business. Issues such as lack of clarity around structure, roles and teamwork, lack of common mission, direction, and priorities are hampering productivity. People are also stretched to their limit.

Output Organization Effectiveness. The organizations effectiveness is threatening current profits and likely affecting, future profits. The deteriorating culture will adversely affect the brand as it is dependent on the funk and love. The low productivity of employees is hindering production of the product and the company will not be able to meet their growth needs.

How do you determine if the business is under- or over-organized?

Level of Organization: When diagnosing a system for a planned change effort the level of organization can have an affect on the intervention design.

In over-organized situations, various dimensions such as leadership styles, job designs, organization structure, and policies and procedures are too rigid and overly defined for effective task performance. Communication between management and employees is typically suppressed (or are one-way only), conflicts are avoided, and employees are apathetic.

In under-organized organizations there is too little constraint or regulation for effective task performance. Leadership, structure, job design, and policy are poorly defined and fail to control task behaviors effectively. Communication is fragmented, job responsibilities are ambiguous, and employees energies are dissipated because they lack direction.

Data Gathering at the Board meeting revealed different and even conflicting expectations for this effort from various members. The practitioner also determined that neither Ben, nor Jerry, nor any board member, except Chico, could provide the day-to-day leadership needed to move development through the organization. On the contrary, the founders wanted to hand off the responsibility to Chico and his to-be-formed management team. The practitioner was to help bring that team into being and to ensure that they took leadership of B&Js business and social missions. It was also to help bring the work force together.

The data gathered supports the conclusion that the system is under-organized. It describes a lack of clarity around structure, roles and teamwork, lack of common mission, direction, and priorities and talk of people being stretched to their limit.The implications of under organization in a planned change effort are that the initial change efforts must be aimed at increasing organization effectiveness by clarifying leadership roles, structuring communications, and specifying job and departmental responsibilities. Rather than the traditional steps of planned change this mode requires modifications to that process.

Identification: Identify the relevant people or groups that need to be involved.

In this case the consultant chose to start with Chico and his team. Other options could have been the board, including Chico and the founders, the whole system at once or the whole system via separate efforts at various levels. Starting with Chicos team keeps the effort manageable and creates a strong, unified base from which to launch any subsequent efforts. Convention: Bring the relevant people and departments together.

The consultant started with Chico and his managers in a series of teambuilding retreats. This gave the managers an opportunity to get to know each other and build trust which allowed them to start setting goals, direction, and priorities for the larger organization.

Organization Structure: The change effort in an unorganized system will require that new interactions among people and departments take place. This may mean new positions, communication channels, plans and policies.

The 20 managers under Chico had been operating fairly independently to this point. The teambuilding brought them together as a team, taught them management and problem solving skill, and prepared them to run the show. The could now work together on setting direction, solving problems and developing systems for control and follow-through. New work clusters were formed among them and each developed their own mission statement that translated into operating goals. In addition, managers met with their employees to get their input. A new safety committee was formed as well.

Evaluation: The activities aimed at increasing organization should be assessed along the way to ensure that they are producing the desired outcome.

Initially there was a disconnect between the new management team and the founders as well as other board members. The founders worried whether the funk and fun was being lost in all of this business and they were against growth, feeling that it would sacrifice cohesion. Managers demanded growth due to existing marketing and franchise commitments. A strategic meeting between the managers and the board allowed them to get aligned and resulted in several actions to address concerns: a joy committee for the cultural aspects, a push for more employee participation in the foundation and a new budget committee to formulate a one-year plan.

What do you think about using teambuilding as the launch for this OD effort? What other approaches might be considered?

Among the interventions that might be considered here are:

Organization Confrontation Meeting: This change method mobilizes organization members to identify problems, set action targets, and begin working on problems. In this case, it would probably represent a series of meetings between two or more feuding groups. However, the case data suggests that the organization is not ready for this type of intervention. The lack of clarity about the strategy and the role of the senior managers in change suggests that there is little guidance to provide the groups who might be trying to resolve their conflicts.

Inter-group relations: These interventions are designed to improve interactions among different groups or departments in organizations. The microcosm group intervention involves a small group of people whose backgrounds closely match the organizational problems being addressed. The inter-group conflict model typically involves a consultant helping two groups understand the causes of their conflict and choose appropriate solutions. The issues facing this company seem more along the lines of alignment, focus, and leadership rather than a true conflict. This could have been used to address issues amongst the founders and board members but wouldnt have addressed the under-organized problem.

Large-group Interventions: These interventions involve getting a broad variety of stakeholders into a large meeting to clarify important values, to develop new ways of working, to articulate a new vision for the organization or to solve pressing organizational problems. This seems like a viable option especially after team building with the top management team. Attempting this intervention before the team building has the same problems as the confrontation meetingtheres no sense of strategy at the top and the large group might have difficulty getting traction on ideas that are generated.

The practitioner chose teambuilding with the management team which could be fully discussed here. OD is not an exact science that can be put into concise prescriptives. Ben & Jerrys was experiencing an organization wide issue. The practitioners point of view was that the board was not prepared to deal with its own issues and become united to provide the leadership that the rest of the organization needed. So the starting point became the managers. They had to become a team before any other level of the organization could be addressed. The outdoor techniques used in this case can be effective teambuilding activities. They get a team outside of their work environment and by design are able to highlight interpersonal, communication and decision making processes.Another option could have been an intervention with the board and founders and to confront them on their lack of leadership and their inability to deal with their own issues.

What are the logical next steps in this organizations development?

Now that the management team has formed and they have aligned themselves with the board and the founders, there is a good opportunity to get the rest of the workforce aligned to and engaged in the newly clarified goals. Getting the system organized around a common mission and goals provides bedrock for them to work on bigger issues. They may need to work on their processes, teamwork at lower levels, communication channels, etc.

The innovative nature of the company and commitment level of the employees suggests a readiness for a large group intervention to take them to the next level.

Teaching NoteCity of Carlsbad (A)


1. To examine organization-wide change processes in the city of Carlsbad.

2. To analyze data from group members about the organization redesign.

3. To formulate action plans from student interpretations of the data (e.g., large-group interventions,intergroup relations interventions and/or organization-confrontation meetings from the information.


This case comes after Part IV, Technostructural Interventions, and provides an opportunity to examine large-scale change processes, including large-group interventions. The case is unique for two reasons. First, it is a multi-part case. This allows the instructor to work with the students in a sequence of events. Second, it concerns a non-profit setting. A lot of OD work is occurring in the public sector and this gives the students a chance to see a change process unfold in a government context. This gives the Carlsbad case excellent flexibility. It has been used, for example, as a final exam case where the students are asked a set of questions to the (A) case, then read the (B) case and make further recommendations. Each part of the case allows the professor to tap into different subject matter areas.Overview of the Case:

This case describes a strategic change effort for the City of Carlsbad. The city manager first implemented a highly participative program that produced a mission statement and set of values to guide the city in its change efforts. A number of initiatives followed to make changes to the information and performance management systems. Following this major effort, the city manager convened a small representative task force to design a new structure for the city. The result was a plan to reorganize the city into five major service areas (MSAs), such as community development safety services, and public works (see Exhibit C in the text). The largest of the MSAs was the Public Works department. It consisted of six previously independent departments. The case describes the initial diagnostic data collected by the public works director and an OD consultant, including data gathered from interviews and focus groups with a variety of stakeholders to design an action plan to build the new structure of the Public Works department.Teaching Strategy (Note: If the professor wishes to cover all three parts of the case, it will be important to manage time on this first part. The (B) case provides a wider variety of issues to discuss and should be given more time than the (A) case. If the (A) case is given as pre-reading, then allot about 20 minutes for discussing the (A) case, about 5-10 minutes to read the (B) case, about 25 minutes to discuss the (B) case, and then about 5 minutes to read and comment on the (C) case.)

1. It is important that the students get clear about the sequence of events leading up to the public works reorganization. In essence, it is the third change effort and students often want to talk about the first two. First, the city manager went through an elaborate change effort resulting in the mission, vision, and several change initiatives. Second, the city manager noticed that something was not fitting together. In all of the major change initiatives, there had been no attention to the structure. So he conducted a much more limited change effort that resulted in the new organization structure. Finally, the public works director, with the blessing of the city manager, engages in a reorganization of his department. It is this change, in the context of the other, which is the focus of the case. Be sure students are clear about the focus. Once that is clear, the discussion can follow the questions at the end of the (A) case in the text quite easily.

2. What is your diagnosis of the situation in the Public Works department?

The data in the case represent a summary of the diagnostic data. There appears to be some fairly independent groups (especially the water district group), redundant processes, and lack of formality. Structurally, it appears to be very differentiated, but not very integrated.

3. What interventions would you recommend and why?

Interventions that might be considered include:

A. Structural design Whats the best organization structure for this department. They are currently organized by function. Alternatives would include a self-contained unit structure (divide the city into quadrantsthe northwest unit, the southeast unit, etc.). Each unit would have a complete set of resources. The benefits would include the development of management talent, locally responsive customer service, and the building of a stronger and more integrated group. The disadvantages would include redundant resources (and potentially higher costs) and the promotion of geographic goals over departmental goals. Another alternative would be a process-based organization. A similar set of advantages and disadvantages could be generated.

B. Reengineering The students could recommend a reengineering process. The diagnostic data points to redundancies in work processes and equipment that could be addressed by looking at the way work gets done in all of the departments. A new set of core work processes could then be identified and implemented.

C. Large-group intervention More a process than an intervention, the successful use of large-group intervention processes during the city managers first change efforts suggests that this method may align with the new city mission and values.

4.Develop an action plan for implementation.

Have students present an action plan for their preferred intervention. Note how each plan matches up with the five elements of a change management process (e.g., motivating change, developing political support, creating a vision, and managing the transition).

In addition, press the students to link the diagnostic data to the intervention action plan. There should be a clear relationship to justify each element of the action plan.

5.Handout the (B) case.

Teaching NoteCity of Carlsbad (B)


1.To understand how employee involvement affects strategic change efforts.

2.To identify techniques used to improve intergroup relations and resolve conflicts.

3.To examine the large-group meeting process and practice planning a future large-group meeting based on the outcomes of the first meeting.


This is the second part of a case series about the restructuring of the public works department in the city of Carlsbad. The (B) and (C) cases are NOT included in the text, but are included in the Instructors Manual to provide the instructor with some control over when the students read the cases and to protect from hindsight in their decision making.


In the (B) case, the public works director has proceeded with a process to reorganize his department. He approved a series of large-group conferences to formulate a mission and a new structure for the Public Works organization, gave the task force a charter and timeline, and watched the first conference, basically, fall apart. After the first conference, a small group post-mortem occurs and they decide to regroup for the second conference. The second conference goes much better and develops some momentum for the change. The public works director approves another conference and the case ends with the question of how to design the next conference.Teaching Strategy: 1. Give the students some time to do their own post-mortem. Based on their discussion from the (A) case and the data in the (B) case, what led to the poor outcomes of the first meeting? What led to the turnaround in the second meeting?

A. Listen for several of the following themes regarding the first conference:

The design of the first conference did not appear to take explicit account of the independence and coherence of the different groups (especially the water district). The city managers structural change process was not as participative as his original process and left people feeling uninvolved and uniformed about the public works reorganization. That is, task force members didnt understand why a new Public Works MSA had been formed. The consultants appeared to underestimate the amount of resistance to the change. The consultants appeared to push the agenda too formally. Instead of dealing with the resistance, the conference was pressed to move forward and commit to a structure that no one believed in. The discussion should also focus on the things that went well. For example, the half-day orientation did produce useful data, it did set clear boundaries for the effort (although one might argue that the time frame was too tight), and people were given an opportunity to see how much support there was for the project. In addition, the small group post mortem revealed important data about the depth of resistance and the motivation to continue. Finally, the second conference helped the task force to regroup and focus. The agenda included a forum for each of the six departments to talk about what they did and discuss the differences among them. The role of the water district in the new organization was discussed. The conference ended with the group developing common ground around the concept of building the ideal future structure to best serve the City of Carlsbad when its growth and development was substantially complete.

2. Designing the Next Conference

The bulk of the time should be spent in proposing a design for the third conference. Specifically, what agenda will help the group to produce an ideal future structure?Several potential agenda items are often raised: A visible statement from the public works director supporting the effort. A process for developing alternative structures and a process for coming to agreement on one structure. Pre-work or assignments to complete prior to the conference How to share information?

Note: The actual agenda produced by the task force is provided on the next page. It can be used to generate questions for the class.

Public Works Organization Design Task ForceMeeting #3 August, 1998

TimeActivity

7:30Pre-meeting to set agenda8:00Opening remarks Review groundrules, boundaries, customer assumptions, etc. Objective for the day: Develop a structure to fulfill buildout requirements8:30Home Table: Connection, Purpose, Promise What are your hopes and fears about the day?9:00EXPO Ten Tables: 4 designs from first workshop, 6 envelopes of data The objective of this exercise is to make your home table as knowledgeable as possible. Be sure that someone from your table goes to each of the ten stations10:00Table Discussion What are the three to five most important buildout design ideas? Present ideas to group10:30Table Discussion Create a buildout design: PW Director direct reports and titles work tasks/responsibilities for each direct report Present ideas to group

12:00LUNCH

1:00Group Discussion What do the designs have in common? What do the designs differ on?2:00Fishbowl to resolve the differences3:00Finalize the Buildout Design4:00Next Steps

3.Handout the (C) case. It describes the results of the task force and summarizes their action plans. Highlight a few key issues from the case in a summary discussion.

A. First, an additional two conferences were scheduled, which brought the total number to four.B. Second, the momentum from the second conference clearly sustained the effort. By the third and fourth conference, they task force was really producing good work.C. Third, the action plan shows a lot of depth, clarity, and precision. People were being moved, buildings constructed, roles defined, and time frames specified. They even identified key contingencies.

4. Subsequent Events:

A. The city manager and public works director were both delighted with the outcomes although they were very concerned about the process. The bad feelings from the first conference lingered for a long time.B. Shortly after the final conference, the Carlsbad city council, in a cost cutting effort, developed an early retirement program and several of the former department managers took the package. This accelerated the consolidation of the departments as specified in the action plan.C. Within two years of the effort, the department had produced enough savings that the public works director and city manager were praised by the Carlsbad city council for the efforts to lower costs and improve citizen satisfaction.

City of Carlsbad, CaliforniaRestructuring the Public Works Department (B)

Results from the Initial PhaseBased on the results of the diagnosis and the recommendations of the OD consultant, the Public Works director approved a series of large-group conferences to formulate a mission and structure for the Public Works organization. An organization design task force composed of volunteers from all levels of the MSA was selected, including all of the department managers. Following a half-day meeting to orient the task force, the plan was to have this group of about 40 people work together in a two-day conference with the expectation that the new structure could be announced within a month.

The Half-day OrientationThe half-day orientation meeting consisted of several presentations and exercises. The City Manager described how the General Plan was going to guide the development of the citys infrastructure and the role Public Works would play in that buildout. The Public Works Director provided the task force with its charter. They were to come up with a mission statement for the department and to propose a new structure for the department. The director announced that he believed there were enough redundancies in the organization that $500,000 in cost savings could be achieved over several years time. He pledged his support to the project by announcing that no layoffs would result because of the new structure. In fact, he believed that the citys growth virtually guaranteed that additional employees would be needed. Finally, the task force engaged in an exercise to identify the work processes in each organization. These processes would then be used in the two-day meeting to identify opportunities for consolidation and reorganization.

The First ConferenceThe agenda for the first conference is outlined in the table below:

TimeDay 1Day 2

Morning Opening exercise Ground rules and agenda setting Mission statement formulation exercise

Redesigning the structure

NoonLunchLunch

Afternoon Making commitments to the mission Diagnosis of the current structure

Action planning Next steps

The change effort was over almost before it began. Shortly after lunch, the member of the task began to challenge the process. While everyone on the task force was aware of the citywide reorganization and the new MSA called the Public Works department, no one understood the reason for the change. Most importantly, the Public Works task force had no clear sense of why they were there, why they should change, or what was so urgent. Resistance and defensiveness from the previously independent departments dominated the balance of the conference. This was especially true of the water district employees. As the meeting proceeded, they began to sit together and for every proposal that argued for integration, they created arguments against it. In addition, public arguments of long-standing differences and problems between different departments surfaced, and complaints emerged that the whole process was a sham since management already had the answer.

Next StepsFollowing the first conference, the consultants, in collaboration with the Director of Public Works, convened a short, four-hour meeting with a small group of task force members. The purpose of the meeting was to debrief the first conference and think about how to proceed. The conversations suggested that most people were frustrated about what had happened. Although a structure had been proposed by the end of the meeting, there was no commitment to the design. Most people confessed that they had agreed to the structure under duress (some people actually told of being threatened to go along), because of time pressure, or out of compromise. In short, they agreed to it for all the wrong reasons. The small group agreed that it was best to acknowledge that reality and start fresh. It made little sense to go forward with a structure that had not been thoroughly discussed or approved. The consultants suggested setting the proposed structure aside and taking another run at it.

The conversations also pointed out that there was a very large interest in continuing. People continued to have ideas about how the structure could be different, that there were a large number of opportunities for improved efficiencies, that they saw this as an important opportunity to design something the right way, and so on. In short, there was still momentum for change.

A second conference was designed to regroup and focus. The agenda included identifying and prioritizing the key customers of the new department, defining their demands of the public works organization, and clarifying a mission. A forum was provided for departments to talk about what they did and to discuss the differences among them. The most important discussion centered on the role of the water district in the buildout organization, the perceived defensiveness and resistance of their group to defining a structure, and what they were willing to do to support the redesign effort.

Finally, the group brainstormed answers to six questions: How can jobs/work be combined? How can costs be reduced? How can time be saved? How can the structure be simplified? How can developers be served better? How can the public be served better?

The defining moment in the daylong meeting was the realization that the key to success was defining the future state in its own terms. That is, the problems and issues that existed now would not exist in 10 years. This freed the group to think about an ideal structure that would best serve the city when its growth and development was substantially complete. They decided that their first output would be an ideal structure. An important base of common ground had been established.

Going ForwardBased on the outputs of the meeting, the Public Works Director authorized two more days for the task force to meet.

What kind of designs would you propose? That is, what objectives do you think are appropriate? How will you get the group to agree on an ideal structure and produce an action plan to implement it?

City of Carlsbad, CaliforniaRestructuring the Public Works Department (C)

Once the task force successfully refocused the effort and found common ground, they were ready to design the organization and plan its implementation. Two additional conferences were planned. Before the next conference, several subgroups were formed to develop and describe different structures. The next conference had as its objective the development and commitment to the departments buildout structure. To get there, the agenda involved a review of the data and four different organization structures that had been developed by the subgroups. Based on the similarities and differences of these structures, and the alignment of the structures to the mission of the department, a buildout design was created.

The last conference identified the changes that would be necessary (including the assumptions that would guide the transition), a timetable for implementation, and the creation of a set of recommendations to the public works director. Selected outputs from the task forces work are provided below:Immediate Structural ActionsThe Organization Design Task Force recommends that the Public Works MSA adopt a structure that reflects its current operations, but also begins to develop a first class engineering organization. The proposed structure is shown below in Exhibit D.

Public Works DirectorSpecial ProjectsAdministrationEngineeringParksCMWDFacilitiesFleetStreets

Figure D -- Public Works MSA (Proposed Current Structure)

Although similar to organization charts currently in use, there are two important changes implied by this structure. First, and most importantly, the task force recommends that the engineering department begin to develop a clear identity by naming one individual to head the engineering function. At the present time, the Public Works Director (PWD) is serving as City Engineer and manager of all engineering functions as well as public works representative to the Leadership Team, the community, and other stakeholders. To be a fully-functioning and effective MSA, the PWD must focus his attention on the broader issues associated with being on the Leadership Team of the City and the broader political and environmental issues that go with building a new organization.

The proposed initial structure leaves, in tact, the existing Carlsbad Municipal Water District (CMWD) (see Task Forces below for one exception). Although the Water Engineers would report to the new Engineering Superintendent, they would remain in the water district building until the new buildings are completed. Organizationally, the task force believes that, in the short run, it is better for customer service, department morale, and operating costs to appoint a Superintendent and begin team building activities than to make any physical move of the water engineering staff. Practically, theres no real physical space to relocate them.The Transition to BuildoutIn general, movement to the buildout structure, shown in Exhibit E, should proceed as quickly as possible. The task force believes that the basic buildout organization chart could be in place as early as 2001. Three important forces or opportunities should be leveraged to implement change. The first force, and the key issue in the transition from a growth city to a maintenance city, is the increasing and then decreasing prominence of the engineering organization. Over the next 5-7 years, the engineering organization must receive attention and resources (hence the Task Forces recommendation to first consolidate engineering under one Superintendent).

Figure 2 -- Buildout Structure

The second most important force facilitating the move to the buildout structure is the attrition or retirement of current managers and superintendents. As these individuals leave the organization, the appropriate functions should be consolidated. The consolidations include:

Moving certain Park functions to Street Maintenance Merging Fleet, Facilities, and Park Functions into an Internal Services Department Moving all below ground maintenance functions to an Utilities Department

The third force that can be used to facilitate the movement of the public works organization to its desired buildout structure is the completion of new buildings. The new administration building provides an opportunity to develop the one-stop shopping counter services idea, and the more clarity around the Public Works Yard building will also determine what can and cannot be accomplished. The task forces preferred option is to have a public works building where nearly all members can be housed under one roof. If that option proves unfeasible, then a second option is also outlined in the transition plan.

The proposed activities can be formed into a preliminary transition plan.

Activity/Area1998199920002001

Preferred Building ScenarioSpecific engineers move to new Administration Building (AB)

One stop Counter Services moves to AB Move all Public Works employees, except Counter Services and Land Use Engineering, to new yard

Backup Building ScenarioMove all of Engineering, except Inspectors to new AB

One stop Counter Services moves to ABMove Inspectors and maintenance functions to new Public Works Yard.

Move selected engineering functions to PW Yard

StructureInitiate Counter Services, Work Consolidation, and Buildings Task ForcesImplement consolidations as possibleImplement consolidations as possibleGoal: Get to Buildout structure by 2001

Career DevelopmentInitiate Career Development Task Force

CommunicationsPlansCommunications Task Force to Meet next Tuesday Meet with superintendents Meet with PWD Meet with Departments

Implementation progress to become part of each Public Works management team meeting agendaSix-month updates on: Structural changes Building progress Action plans Consolidation studies Cost savings

Cost SavingsImplement Costs Savings Task Force

Implement cost savings programsImplement cost savings programs

Teaching NoteC&S Grocers: Self Managed Teams


1. To explore problems of organizational growth and how OD might be helpful in facilitating these changes

2. To allow students to explore the pros and cons of using self-managed teams as a techno-structural and productivity intervention

3. To allow students to develop an implementation plan to transition from the current warehouse operation to the new form of work

Placement of the case:

The C&S case comes in Part IV of the text and is specifically concerned with self-managed teams, a popular socio-technical systems work design intervention. It is also generally within the class of interventions known as employee involvement. As a result, this is a great case to discuss the pros and cons of self-managed teams, the appropriate conditions for such an intervention, and the implementation issues associated with the transition. The one thing the instructor might consider is discussing this case after reading Chapter 17 on Performance Management. There are a number of reward system and measurement issues in the case and the students may not have enough information to fully critique this aspect of the intervention.

Case Overview:

The C&S case focuses on the decision to change the work design and organizational structure within a wholesale grocery distribution warehouse. The change involves shift from an individual work design that rewards individual performance to a self-managed team focus.

C&S was founded in 1918 to serve retail grocers by providing warehousing services and has grown partly because of its reputation for innovation, efficiency, operational excellence, and customer service. In October of 1988, and as a result of adding a large client (A&P stores), annual sales had grown from $450 million to $650 million. As the busiest holiday season ever was approaching, Rick Cohen (CEO) was worried that this large new client had severely stressed the operations of the warehouse and sent hiring, turnover, quality, safety, and morale in the wrong direction.

As a way to stem these problems, Cohen had heard about self-managed teams and set up an experiment, believing that making a team accountable for selecting, loading, clerking, and other duties within the warehouse would promote productivity and accountability. The experiment increased order accuracy and efficiency, and Cohen was considering how to implement the new program.

Cohen must evaluate if the potential benefits outweigh the risk of change throughout the warehouse in the context of a busy holiday season, and the willingness of his staff to embrace this change. Further, he must decide whether or not this experiment can be successfully implemented with hundreds of employees.

Class discussion:

In the context of the chapters on employee involvement and work design, the students should be led through a series of discussions about the situation at C&S. Among the topics described below are diagnosing the work flow, specifying the new design, and implementing the design. A good way to kick off the discussion is to set the context.

What is the current situation at C&S?

There are several reasons for Cohen to be worried about his organization:

Rising operational costs, shrinking margins, quality control problems, customer management issues Increased employee hiring, inexperienced personnel, more supervisors Overcrowded workspace, congested aisles, misplaced pallets of material Low employee morale, increased injuries, increased turnover (selector turnover 90%) Lack of employee accountability for customer orders Order accuracy not insured, resulting in emergency van loads being shipped to customers and an inability to verify the source of the mistake A busy holiday season approaching

Optional: Cohen believes that forming into teams will be both more motivating and more productive. What is your experience in working in teams? What processes and systems in a team push you and other members to do great work? Several topics usually emerge, including

Clear goals Shared rewards Strong norms and expectations for performance and quality (where do those come from?) Compelling vision Interesting work

From here, applying the material from Chapter 16 makes the most sense from a diagnostic perspective.

How would you describe the work at C&S? Is this a situation that favors self-managed teams?

The case provides some good detail about the work flow at C&S. At the highest level, the core work processes can be represented as follows:

ShippingSelecting & PackinghippingReceivingChapter 16 suggests that workflows can be diagnosed along two dimensions social and technical. For the technical workfl

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