Discuss the historical context of change and how organizations were affected by it







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Discuss the historical context of change and how organizations were affected by it

Introduction

The individual strength of the people is aggregated to achieve common goals by working in groups thus forming organizations where they accomplish their objectives and goals. These kinds of organizations are basically developed to cater to the needs of the customers thereby satisfying the customer needs as a result the company also has a profit in turn. There are various criteria to develop and run a successful organization and various strategies are followed to achieve the business tactics in making decisions, resolving conflicts, control distribution etc. The organization should develop amidst the changing environment. These strategies also help in understanding behavioral and psychological aspects of events which needs a great understanding.

The initial theories of organizational development are developed during the first industrial revolution in 19 century. The modern theories are developed upon the initial ones. Various theories have been developed; among them the broad classification is

  • Orthodox organizational thoughts (organizational classicism)
  • Neo-Orthodox organizational thought (Neo-Classicism)
  • Non-orthodox Thought (Contemporary)

According to the Newtonian Mechanics developed in 17th century, the whole world and nature is governed by laws that surrounds the universe and everything follows a particular order in the universe .All the natural phenomena also abide by these laws, through this law, linear causality, rationality, determinism and reductionism.

In accordance with the Frederick the Great who developed the Militarism and Mechanization theory, the structures and processes of waging war were redirected and were applied to military establishments. This is achieved by creating elements such as systematic hierarchy in authority establishment, providing identity by uniforms; regulating the standards, specializing in performing task. Other methods such as usage of common language to prevent miscommunication and technical skill trainings were also improved. This theory was a great success as the troops were under the control of authority and decision making powers were given to the local authorities.

Persons like Henri Fayol, Gulick, Max Weber and Ur wick, Reiley and Taylor and Mooney developed the classical theory. The core value of the classical theory is to improve the productivity and increase the efficiency by rational methods. They did not give importance to psychological and social variables. In the year 1700, Circa developed the scientific theory. When compared to the causality dependent model of Newton, this theory gave importance to the rational, logical –sequential approach and the linear- casual approach.

The approach of Frederick Winson Taylor’s organization theory increased the profit of the industries which in turn led to the increase in the productivity. Thus the cost reduction is carried out by increasing the efficiency of worker task. The recruitment process according to this theory is based on the scientific method for selecting people and training them according to the specific job. This establishes the duties of both management and the workers and also increases the cooperation among the workers. The bureaucracy theory proposed by Max Weber in early 1900s was so formal that the organization offers a way to be impartial, practicable and fair. This theory had a control over the workers through regulations, rationalism, impersonality and bureaucratic machinery. It had a pessimistic idea on the human freedom (Wrong, 1970). As the classical theory that is based upon the ideas of nature which is inherently irrational and lazy and classical thought, the modern theories had a control over the feelings of the human by giving economic incentive.

The theory which is based on the classical theory is The Neo-classical theory which is developed in the year 1935. This theory is mainly focused on the “organization without people”. This theory explained the effects of the human on the productivity by the Hawthorne studies made by Elton Mayo from 1927-1932.

According to the theory the three features of human are,

  • With the help of social requirements the man identifies his basic sense through relationship with others and gets motivated.
  • He does not give importance to the incentives and control given by the management when compared to the forces which are of social to which he is more responsible.
  • He becomes responsible to management only when his requirements are satisfied by the subordinates (Schien 1980).

As this theory is keener about the management strategy it mainly has its focus on the feelings of the workers and accepts the work and not the task. Thus the management has to manage with the formal methods of organization regulations like orders, payment plans and also with informal organization plans such as employee’s sentiments, when a problem is aroused. In accordance to Korten(1984), the management has to cope up with both formal and the informal organization plans.

During the early years of 1960 the behavioral school emerged from the human relations. This school involved in developing the theories proposed by Argyris, Herzberg, Maslow, MacGregor, Liket and Warren Beunis. These theories mainly redefined the functions of a worker as a function of his environment in terms of expectations, management style and structure as well as in terms of the individual such as goals, ideas and feelings. This theory also established the feature of sense of pride and self esteem that one can identify himself. Contradicting this theory was proposed by Wolf, Kast & Rosen-Wieg Bukley, Lippit (1982), Harmon (1981), Carton (1981) in which the human system is observed as innately good, influenced by the environment, and considered within public administration (Botton 1986; Hess & Pale, 1986). In addition development of stress in team work is considered to be an important element in organization development.

Define Bureaucracy and evaluate the strengths and weaknesses of bureaucratic organizations. Is this organizational structure applicable in today's Business world? Justify

The initial concept of Bureaucracy was used to explain the work place, which was derived from the term ‘bureau’ in early eighteenth century. Later the term was morph sized to describe the office power or the rule which mainly came into practices after the French revolution. The term Bureaucracy, “is the process of administrating a large organization with the help of establishing hierarchical relationship between its people and implementing fixed and rigid rules and regulations to manage operations of the organization”. Regardless of political and ideological foundations, the bureaucracy was initiated to apply for both public and private administrations.

The various strengths and weakness of bureaucracy are:

STRENGTHS WEAKNESS
Dominance Hierarchy is the way of organization structure which is of vertical hierarchy that is controlled under supervision. To assign a task of a person, the case of officials, clergies and scribes are required and thus the position in the management depends on the management.
The position of all the authorities is symbolically conveyed by the title on the organization chart. The ability of a person to perform his task is limited as it is only assigned based on the designation of the person.
Based on their expertise and their special skills people are classifies under individuals or groups. Thus, the innovation and creativity of the individual is suppressed.
According with the responsibility of each memener businesses such as strategic planners, marketing and human resources are executed. Due to the strict rules and the regulations the development of discrimination takes place along with the lack of personal development.
The procedural manual and the pre-prepared policies will guide on the job training needs and thus do not require mentors to train new people. The resources and power are only with the higher levels i.e. top leadership and is not transferred to the subsequent levels.
The personal interest, income and official are separated properly. The responsibility of making decision is reduced as guidelines and policies doesn’t allow to take decisions .
All the official businesses are properly documented.
The regulations and the policies convey necessary things to the authorities.
Official business takes place on regular basis.

Thus the Bureaucratic organizations cannot be applied in today’s industrial situation. With the advent of globalization the environment has undergone a lot of changes where the decision making process cannot happen at a glacial place as in case of the bureaucratic organization.

In today’s world the opportunities will be lost completely if the changes are adapted in a slower rate. And also the organization will not give new innovation and opportunity limitations for the employees to grow.

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Task 2

Supermarket Industry of UK

Evaluate and compare the different approaches which Supermarkets may use in context of Organizational development? At least compare the two approaches.

The requirements and demands of organizations are changing according to today’s world.

In accordance with that the organization development should be carried for the changing requirements of the organization. Thus organization development plays a crucial role in catering the needs of the growing world. It is a team effort that is planned and managed from the higher level and executed till the lower one to increase the effectiveness of the organization through proper planning and execution with analytical node of thinking. Thus organization development is a part of company’s growth in terms of its performance. The main goal of organization development is to increase the productivity, profit and quality of work in the organization.

The major activities that are involved in organization development are:

The major techniques that are used in organization development are:

  • Organizational structural approach
  • Job design approach
  • Socio-technical change approach
  • Employee counseling approach
  • Interpersonal and intergroup relationships approaches
  • Confrontation techniques
  • Leadership style approaches

The organization development has gained importance in supermarkets also in terms of developing policies. One such example is Tesco which is a largest supermarket company in UK that has implemented various ideas for organization development. As the company deals both retail business comprising different range of products, they need to coordinate both the suppliers as wells as the customers who are from different modes of life differing in the culture, language and tradition. Thus the company needs to maintain a good relationship with everyone both in terms of communication and cooperation. This is done by executing a proper organization planning. As the company relies mainly on the suppliers to maintain constant business, Tesco has maintained a close relationship with the dealers in order to promote the supplying condition and getting long term orders.

They developed supplier management programme to find out the key suppliers and also obtaining franchisee satisfaction. They also took part in ethnical trading initiative.

They improved the online sales by introducing on-line systems and also provided loyalty cards to the customers, so that shopping was made easy for them. This system was followed to adapt them to the growing change, to maximize the customer service and innovation in product development. The key development that they made was the analysis of all the stock and deliveries records with the help of information technology. This made them to control and update the level of stock and deliveries. This played an important role in business strategy development.

Other technologies that are followed for organization development by Tesco in order to increase the product and service are

  • Cost controlling
  • Intelligent scale
  • Installing wireless devices
  • Automated machines for check in and check out
  • Radio frequency distribution

With respect to the employees the working hours has been made flexible, forming trade unions that in order to protect working rights, creating agreement for partnership between employee and management. Apart from this pension scheme was also introduced, after all, the employee should be satisfied for proper development of business. The supplier relationship was also engaged and they adopted new recruitment policies.

The methods that have been followed before the organizational change is restructuring the organizational approach by changing the policies, communication methods, product development, new marketing strategies, change in centralization, labor division and adding or deleting departments.

Organizational structural changes are designed for optimal and effective usage of resources for the present situation and to adapt the future changes. The goals of the company both short term and long term play an important role. This is implemented by bringing about changes in the tasks performed, the people and the technologies used. Along with the improvement in the productivity the organization should also develop in terms of socio- technical skills. By utilizing the change due to the socio technical approach, where the organization of people from various technologies is focused, the Tesco formulated the business strategic plans that played a central role. The integral part of this system is human relations and thus the effect is brought in about the interrelationships, behavior pattern and motivation of the people. As this technology change plays a vital role in the organization development, the motivational orientation and the human relationships should also be considered.

Select a Retail store from the industry and identify the changes appropriate for it to be successful. Support your answer with appropriate models and process for change in the organization

The largest company in UK is Mark and Spencer who is the largest retailer with more than 68,000 employees, have 300 company-owned stores and 85 franchise stores. The company’s goods are sold in Canada, Hong Kong and Europe. Due to poor management practices, the company’s profit is decreased about 3.6%. This is mainly due to improper decision making with no proper strategic planning. The progress is diminished due to the leadership problems such as lack of experience regarding management, and time taken to make decisions and also the improper organization of the operating committee board. In addition to this the flow of cash is not managed in proper manner leading to poor financial control. The costing system is poor with poor budgetary. Firing of employees is also another factor. The main reason in the marketing side is the lack of trust towards the customers which led to main decline in profit. Low quality products and lack of innovation was also present. This is mainly due to the poor management labor relationship that has become a major reason for the decline in the profit.

The organizational structural approach was adapted by the company in order to improve its profit and productivity. The five main core values are followed. They are:

  • Service
  • Quality
  • Innovation
  • Quality
  • Trust

The organization believed and used Holmes management, which the management process was the main focus when compared cost, product and decisions disapproval. The Financial part of the company was taken care by HSBC.

The following are carried out for organization development:

  • The supply chain was increased
  • Unnecessary administration cost was reduced
  • The mentality of the employees were changed
  • Retail centers were opened in out of town
  • Restructuring and redundancy
  • Up gradation of the company store.

The preferences being provided to the employees were increased and improvisations were made in the internal communication process as well as the needs and demands of the customers were satisfied. The company’s profit is further increased by innovative products that target the middle class people which were about sixty percent in UK population. The preferences of the customers were also changed and the prices of the high quality products are restructured by bringing about some changes. This was considered to be an effective option to improve the company’s profit. The product quality should be improved in marketing of food.

Use the appropriate tools to develop the systems to understand and involve appropriate stakeholders in the introduction of change. Evaluate how successful your system will be specially in handling the resistance to change in the organization

Stakeholders are people who affect the product design from both internal environment and external environment of the organization. Primary stakeholders are those who form the integral part of the organization whereas the secondary stakeholders are those who have care for the organization which also includes public (Sharp et al, 1999). For the improvement of the company there should be changes brought in order to involve the stake holders which involves developing of appropriate systems with reference to the stakeholders. The important things to be done are

• Identification of appropriate stakeholders • The needs of the stakeholders are determined • The requirements of the stakeholders are satisfied.

Identification of stakeholders is crucial and it is based on the role that the stakeholder is supposed to carry for the development of the organization. In accordance with the M & S supermarket the loss of the company is also due to the improper identification of stakeholders and thus can be rectified by opting people from diverse expertise such in the fields of human resources, marketing etc.

The important aspect is the transparency between the stakeholders; they need to share the information about products and tasks to be performed. The main thing is that this interaction and communication between them should be documented (Sharp et al 1999). This can be made effective by preparing questionnaire, checklists, focus group methods, making interviews can be done (Harding et al. 2001).

The organization is done not only to improve the profit of the company but also to maintain the increased profit. Plans should be devised to target the future customers also. The information from the stakeholders are collected and discussed properly and a solution is found for things to be resolved.

The strategies that are devised by the stakeholders are brought under a single roof, considering the functional requirement and the constraint. This will pay way to understand the requirements of the company such as developing new product, customer loyalty, technological advancement, pricing, employee satisfaction, etc. both the external and internal requirements are taken in to consideration when a solution is provided by the stake holder. For example during the new product development or change in the product style by reducing the cost of the item, the company should analyze the ideas of the stakeholders by an internal team which is based on the organizations value and the core objectives of the company. The requirement of stakeholders is considered before designing a new product taking into account regarding the functions and sub-systems. The proposed model will help in supporting validation and verification the numbers of stakeholders involved in bringing about a change in the organization values.

Develop a complete plan for implementation of the changes and identify at least two objectives the Supermarket will achieve at the end of implementation

The various organizational development strategies that the Mark and Spencer Company should follow to improve its profit are:

Human resource is considered to be very important for the growth and productivity of the company and thus company should have prime focus on that aspect. Flexible working hours should be provided to the employees according to the workers right provision of the trade union action. Necessary actions should be taken to develop the communication skills of the employees (Storey et al, 2005), providing climate of flexibility, complaint procedures should be addressed. Needs of the customers, enumeration of ideas and changes in recruitment patterns are also carried out. Opportunities are provided to improve the skills and technical knowledge of the skills by introducing the knowledge management practices. Changes such as pension scheme, recruitment and supplier employee relation are made. This is done in order to prevent unions.

The technological aspect is also improved by introducing online purchase rather than coming to the supermarket thereby the recruitment of the employees can be reduced. Other technologies such as self scanning, laser screening and new modes of improving communication aspects like e-commerce can be implemented. By implementing all the above said strategy the Mark and Spencer Company will have and enormous growth in terms of its production and profit. By following proper management practices the company will have employee satisfaction in terms of decision making, growth opportunities, pension scheme. The customer satisfaction will also be increased by following new innovative ideas, product development and by implementing new technologies.

References

Harding, J. A., Popplewell, K., Fung, R. Y. K. and Omar, A. R., (2001). An Intelligent Information Framework Relating Customer Requirements and Product Characteristics. Computers in Industry, 44, 51-65.

Sharp, H., Finkelstein, A. and Galal, G., (1999). Stakeholder Identification in the Requirement Engineering Process. Proceedings of Database and Expert Systems Applications, IEEE Computer Society Press, Florence, Italy.

Lippitt, Gordon (1982) Organizational Renewal, N.J.. Prentice-Hall.

Harmon, Michael (1981) Action Theory for Public Administration, N.Y., long man.

Carton, Bayard and Harmon, M. (1981) Action Theory in Practice, Public Administration Review 41(5): 535.

Hess, Randy and Pate, Larry E. (1986) A Contingency Model of Organization Development Change Processes, Organization Development Journal Vol. 4 (3): 40-46.

Bolton, Andrew (1986) Organization Development in Management and Version, Organization Development Journal 4 (4): 11-19.

Schien, Edger (1980), Organizational Psychology, N.J., Prentice-Hall

Retrieved online from January 24, 2010 from http://ivythesis.typepad.com/term_paper_topics/2009/05/the-bureaucracy.html

Retrieved online from January 24, 2010 from http://www.legacee.com/Info/Leadership/Bureaucratic.html

Retrieved online from January 24, 2010 from http://media.wiley.com/product_data/excerpt/86/07879571/0787957186.pdf

Retrieved online from January 24, 2010 from http://medind.nic.in/haa/t00/i1/haat00i1p128g.pdf


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