MGT 429 CH 14

Chapter 14
High-Performing Systems and

the Learning Organization
An Experiential Approach to Organization Development 8 th edition Chapter 14

Copyright ©2011 Pearson Education, Inc. Publishing as Prentice Hall Slide 1
Learning Objectives (part 1 of 2)
• Describe system-level intervention.

• Identify survey research and feedback
process.
• Recognize characteristics of learning
organizations.
• Recognize steps of reengineering.

Learning Objectives (part 2 of 2)
• Describe system 4 management.
• Explain characteristics of high-
performing systems.
• Recognize 6 phases of Grid OD
program.
• Experience and practice system
approaches.

System-Wide Interventions
• OD interventions aimed at change
within total system.
• OD is systems approach to group and
interpersonal relations.
• System wide interventions examine:
– Organization design.
– Organization flow patterns.
– Interactions of individuals and groups.
Survey Research and
Feedback
• Employee attitude surveys serve two
important functions:
– Improvement tool.
– Communication tool.

Steps in Survey Feedback
Step 1 - Top management plans survey.
Step 2 - Outside staff gives questionnaire.
Step 3 - Outside staff summarizes data
and gives feedback to organization.
Step 4 - Work group diagnoses problems
and develops action programs.

Results of Survey Research
and Feedback
• Indicate positive changes in employee
attitudes and perceptions.
• Greater involvement of members
produces greater change.
• Feedback combined with other
interventions results in more substantial
change.
Learning Organization (part 1 of 2)
• System-wide change program.
• Emphasizes reduction of organizational
layers.
• Involvement of all employees.
• Continuous self-directed learning.

Learning Organization (part 2 of 2)
• Leads to positive change in individual,
team, and organization.
• A learning organization develops
continuing capacity to adapt and
change.

Approach to
Learning Organization
• Brings together key members in
collaborative process to discover
problems.
• Then develops model of new system.
• Continuous testing of experience into
knowledge accessible to whole
organization.

Core Values of Learning
Organizations (part 1 of 2)
• Value different kinds of knowledge and
learning.
• Encourage communication between
people with different perspectives.
• Develop creative thinking.
• Remain nonjudgmental of others and
their ideas.
Core Values of Learning
Organizations (part 2 of 2)
• Break down traditional barriers.
• Develop leadership throughout
organization.
• Reduce distinctions between members.
• Every member has untapped human
potential.

Characteristics of
Learning Organizations
• Constant readiness.
• Best knowledge available.
• Collaboration across organization.
• Continuous planning.
• Improvised implementation.
• Action learning.

Reengineering:
Radical Redesign
• Radical redesign of business processes
to obtain drastic improvements.
• Makes all processes more efficient to
gain quantum leap in performance.
• Emphasizes products, customer
satisfaction, and improvement in
processes.
Steps in Reengineering
Process
Step 1. Identify key business process.
Step 2. Identify performance measures.
Step 3. Reengineer the process, organize
work around process, not functions.
Step 4. Implement redesign process and
continuing reevaluation.

System 4 Management
• System 4 management model based on
research of organizations.
• Describes organizations on a continuum:
– Bureaucratic organizations (ineffective) at
one end.
– Participative (effective) at the other.

The Four Management
Systems
• System 1 – Exploitive-authoritative (top-
down, autocratic,).
• System 2 – Benevolent-authoritative
(top-down, less autocratic).
• System 3 – Consultative.
• System 4 – Participative.

Implications to OD
• System 1 organizations tend to be least
effective.
• System 4 tend to be most effective.
• OD practitioner tries to move
organization from system 1 to system 4.

Figure 14.1
Profile of Organization Characteristics

Common Elements in System
4 Organizations
• Action rather than further analysis.
• Decisions involving subordinates, not
superiors.
• Individual accountability, not rigid
policies.
• Recognition of team and individual, not
blanket expressions of thanks.
High-Performing Systems
(HPS)
• HPS calls for removal of excessive
layers of organization.
• Creates climate of participation and
communication across functional
barriers.

Eight Criteria Used to
Examine HPS (part 1 of 2)
1. Perform excellently against external
standard.
2. Perform excellently against potential.
3. Perform excellently to some earlier
point.
4. Perform with significantly fewer
resources than assumed are needed.
Eight Criteria Used to
Examine HPS (part 2 of 2)
5. Doing substantially better than other
systems.
6. Source of ideas for others.
7. Fulfills high level for culture within
which it exists.
8. Only system that is able to do what it
does.
Characteristics of HPS (part 1 of 2)
• An HPS knows why it exists.
• Commitment to purposes always high.
• Teamwork focused on task.
• Leadership is strong and clear.

Characteristics of HPS (part 2 of 2)
• An HPS is source of new methods.
• Strong consciousness that “we are
different.”
• Other subsystems often see HPS as
problem because HPS produces its own
standards.
• HPS is cohesive unit.

Grid OD Program
• Systematic approach to achieve
corporate excellence by changing basic
culture of system.
• Starts with focus on managerial styles.
• Moves through phases involving the
work team and culture of organization.

Six Grid Phases (part 1 of 3)
Phase 1: Grid seminars.
– Someone in management position attends
seminar.
Phase 2: Teamwork development.
– Begins with top manager and continues
through entire organization.

Phase 3: Intergroup development.
– Sessions attended by key members of 2
segments where barriers exist.
Phase 4: Development of ideal strategic
model.
– Provides skills to move to systematic
development.

Phase 5: Implement ideal strategic model.
– Organization divided into planning teams
and model is implemented.
Phase 6: Systematic critique.
– Examination of progress toward change
goals.

OD Application
The Learning Organization at
Lafarge
• Lafarge world’s biggest cement
producer.
• Culture traced to its origins in 1833.

• Participative management philosophy
includes:
– Key for managers to develop their people.
– Employees share and seek experiences of
others.
– Dealing with conflict integral to teamwork.
– Teamwork creates environment of trust
and confidence.

• Important element is training.
• Managers required to monitor
development of employees.
• Lafarge practices intensive
communication so that its worldwide
businesses understand operations.

OD Application
Cisco and High-Performing
Teams
• Was top-down and highly competitive.
• Cisco initiated massive change.
• Revolutionary change was company’s
only chance.
• Cisco examined every part including
operations, priorities, and culture.
• Before changes Cisco was described as
wild west cowboy culture.
– Executives encouraged to compete with
one another.
– Ideas were pursued with little discipline or
accountability.
• Market changed.
– Customer expected integrated company.
– Engineering, manufacturing, professional
services, and sales must work together.
• Changes permeated entire company.
• New structure is network of councils
and boards.
– Council - team who has decision-making
authority on >$10 billion opportunities.
– Boards - teams who make decisions on $1
billion opportunities.
– Working groups – deal with specific issues
for limited time.

Key Words and Concepts
• Grid OD.
– Defines problem areas for OD.
– Goes through phases designed to pursue
systematic change.
• Grid phases.
– Six phases that a typical Grid OD program
goes through.

• High-performing system (HPS).
– Removal of excessive layers of structure
within organization.
– Encourages participation across barriers.
• Ideal strategic model.
– Phase 4 of Grid OD program. Model
developed to achieve excellence.
• Learning organization.
– Continuing capacity to adapt and change.

• Reengineering.
– Radical redesigning processes to achieve
drastic improvements in performance.
• Survey research and feedback.
– Collect data and give feedback to allow
organizations to diagnose problems.

• System 4 management.
– Continuum from system 1 to system 4.
– System 4 is ideal that organizations
attempt to achieve.
• System-level organization.
– Structural design framework for viewing
organization.

Preparations for Next Chapter
• Read Chapter 15.
• Prepare for OD Skills Simulation 15.1.
– Prior to class, form teams of six and select
roles.
– Complete Step 1.
• Read and analyze Case: The Space
Electronics Corporation.


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MGT 429 CH 14

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Chapter 14

High-Performing Systems and

An Experiential Approach to Organization Development 8 th edition Chapter 14

• Describe system-level intervention.

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

An Experiential Approach to Organization Development 8 th edition Chapter 14

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