Organizational Change and Development

Paper Code: DM322

Max. Marks: 60

Instruction: Students are required to write their Roll No. on every page of the question paper; writing
anything except the Roll No. will be treated as Unfair Means. In case of rough work please use the
answer sheet.
Section A Answer any three questions. Each question carries five marks.
A1. Compare and contrast the three models of Planned Change.
A2. T-groups are probably the oldest OD intervention. Explain the advantages and disadvantages of using Tgroups.
A3. The goal of contracting is to make a good decision about how to carry out the OD process. Explain the
different elements of an effective contract.
A4. Explain the various steps of any proactive OD intervention.
A5. The Johari window is a useful model for increasing the individual's awareness about how their behaviour
affects others. Elaborate.
Section B
Answer any three questions. Each question carries ten marks.
B1. List out any five characteristics of an Open System. How can organizations be diagnosed at 3 levels
using this approach?
B2. As an OD consultant trying to increase the effectiveness of a loss-making organization, how would
you ensure that you
(a) overcome resistance to change and be accepted, and
(b) stand against politics in the organization?
B3. The contemporary workforce is very diverse in terms of age, gender, culture, values arid physical abilities.
Highlighting these current trends and their organizational implications, explain the various interventions
that should be initiated keeping in mind the needs of the workforce.
B4. Strategic interventions focus on organizing the firm's resources to gain a competitive advantage in the
environment. Explain with the help of any three strategic change interventions.

Section C
Read the following case and answer the questions that follow. All questions are compulsory and carry five marks
each.
At the Sullivan Hospital System (SHS), CEO Donald Fulton expressed concern over market share losses to
other local hospitals over the past 6 to 9 months and declines in patient satisfac tion measures. To him and his
senior administrators, the need to revise the SHS organization was clear. It was also clear that such a change
would require the enthusiastic participation of all or-ganizational members, including nurses, physicians, and
managers.
At SHS, the senior team consisted of the top administrative teams from the two hospitals in the system. Fulton,
CEO of the system and President of the larger of the two hospitals, was joined by Mary Fenton, President of the
smaller hospital. Their two styles were considerably different. Whereas Fulton was calm, confident, and mildmannered, Fenton was assertive, enthusiastic, and energetic. Despite these differences in style, both administrators
demonstrated a willingness to lead the change effort. In addition, each of the direct reports was enthusiastic about
initiating a change process and was clearly taking whatever initiative Fulton and Fenton would allow or
empower them to do.
You were contacted by Donald Fulton to conduct a 3-day retreat with the combined management teams and
kick off the change process. Based on conversations with administrators from other hospitals and industry
conferences, the team believed that Total Quality Management (TQM) would be an appropriate intervention for
two primary reasons. First, they believed that improving patient care would give physicians a good reason to use
the hospital thus improving market share. Second, the primary regulatory body, the Joint Commission on
Accreditation of Healthcare Organizations (JCAHO) had enacted policies some time ago encouraging hospitals to
adopt continuous improvement principles. The team readily agreed that they lacked the ade quate skills and
knowledge associated with implementing a TQM process. This first meeting was to gather together to hear about
the history of TQM and the issues that would need to be addressed if TQM were to be implemented. In
addition, you guided them through several exercises get the team to examine methods of decision making,
how teams solved problems using TQM processes, and to explore their understanding of the hospital's current
mission, goals, and strategies.
Although you were concerned about starting the process with a workshop that explored a solution rather
than understanding the problem, you remembered Roger Harrison's consulting rule, "Start where your client is
at," and agreed to conduct the workshop. You were assured by Fulton that the hospital system was committed to
making substantive changes and that this was only the first step. In addition, and in support of this commitment,
Fulton tells you that he has already agreed in principle to begin a work redesign process in a few of the nursing
units at each hospital and has begun to finalize a contract with a large consulting firm to do the work. The
workshop was highly praised and you convinced the team to hold off long enough to conduct a diagnosis of the
system.
Following the retreat, your diagnosis of the SHS organization employed a variety of data col lection activities
including interviews with senior managers from both hospitals as well as a sampling of middle managers and staff
(for example, nurses, ancillary professionals, and environmental services providers)! Questions about the
hospital's mission garnered the most consensus and passion. There was almost unanimous commitment to the
breadth of services provided and the values that played a prominent role in the delivery of those services by a
Catholic-sponsored health care organization such as SHS. A mission and values statement was clearly posted
throughout the hospital and many of the items in that statement were repeated almost verbatim in the
interviews.
From there, however, answers about the organization's purpose and objectives became more diverse. With
respect to goals and objectives, different stakeholder groups saw them differently. Senior administrators were
fairly clear about the goals listed in the strategic plan. These goals included increasing measurements of patient
satisfaction, decreasing the amount of overtime, and increasing market share. However, among middle managers
and supervisors, there was little awareness of hospital goals or how people influenced their accomplishment. A
question about the hospital's overall direction or how the goals were being achieved yielded a clear split in people's
perceptions. Some believed the hospital achieved its objectives through its designation as the area's primary
trauma center. They noted that if someone's life were in danger, the best chance of survival was to go to SHS.
The problem, respondents joked, was that "after we save their life, we tend to forget about them." Many, however,
held beliefs that could be labeled "low cost. That is, objectives were achieved by squeezing out every penny of cost
no matter how that impacted patient care.

Opinions about the policies governing the hospital's operation supported a general belief that the organization
was too centralized. People felt little empowerment to make decisions. There also were a number of financial
policies that were seen as dictated from the corporate office, where "shared services" existed, including finance,
marketing, information systems, and purchasing. Further, several policies limited a manager's ability to spend
money, especially if it wasnt allocated in budgets.
In addition to the managerial sample, a variety of individual contributors and supervisors were interviewed
either individually or in small groups to determine the status and characteristics of different organization design
factors. The organization's policy and procedure manuals, annual reports , organization charts, and other archival
information were also reviewed. This data collection effort revealed the following organization design features:

The hospitals structures were more bureaucratic than organic. Each hospital had a functional structure with a
chief executive officer and from two to five direct reports. Both hospitals had directors of nursing services
and professional services. The larger hospital had additional directors in special projects, pastoral care, and
other staff functions that worked with both hospitals. Traditional staff functions, such as finance,
procurement, human resources, and information services, were centralized at the corporate office. There were
a number of formal policies regarding spending, patient care, and so on.

The basic work design of the hospitals could be characterized as traditional. Tasks were narrowly defined (janitor,
CCU nurse, admissions clerk, and so on). Further, despite the high levels of required interdependency and
complexity involved in patient care, most jobs were individually based. That is, job descriptions detailed the
skills, knowledge, and activities required of a particular position. Whenever any two departments needed to
coordinate their activities, the work was controlled by standard operating procedures, formal paperwork, and
tradition.

Information and control systems were old and inflexible. From the staffs perspective, and to some extent even middle
management's, little, if any, operational information (that is, about costs, productivity, or levels of patient
satisfaction) was shared. Cost information in terms of budget ed versus actual spending was available to middle
managers and their annual performance reviews were keyed to meeting budgeted targets. Unfortunately,
managers knew the information in the system was grossly inaccurate. They felt helpless in affecting change, since
the sys tem was centralized in the corporate office. As a result, they devised elaborate methods for getting the
"right" numbers from the system or duplicated the system by keeping their own records.
.
Human resource systems, also centralized in the corporate office, were relatively generic. Internal job postings were
updated weekly (there was a shortage of nurses at the time). There was little in the way of formal training
opportunities beyond the required, technical educational requirements to maintain currency and certification.
Reward systems consisted mainly of a merit-based pay system that awarded raises according to annual
performance appraisal results. Raises over the previous few years, however, had not kept pace with
inflation. There also were various informal recognition systems administered by individual managers.

Questions
1. Assemble the diagnostic data into a framework and prepare feedback to the senior adminis trators of the
hospitals. What's your sense of the organization's current structure and employee involvement issues?
2. What changes would you recommend? Is a total quality management intervention appropri ate here? What
alternatives would you propose?
3. Design an implementation plan for your preferred intervention.