Organizational behavior

648 PART 4 The Organization System the change process.17 Underscoring the importance of social context, other work shows that even individuals who are generally resistant to change will be more will- ing to accept new and different ideas when they feel supported by their coworkers and believe the environment is safe for taking risks.18 Another set of studies found that individuals who were dispositionally resistant to change felt more positive about it if they trusted the change agent.19 This research suggests that if managers are able to facilitate positive relationships, they may be able to overcome resistance to change even among those who ordinarily don’t like changes. implementing Changes fairly One way organizations can minimize negative impact is to make sure change is implemented fairly. As we saw in Chapter 7, procedural fairness is especially important when employees perceive an out- come as negative, so it’s crucial that employees see the reason for the change and perceive its implementation as consistent and fair.20 manipulation and Cooptation Manipulation refers to covert influence attempts. Twisting facts to make them more attractive, withholding information, and creating false rumors to get employees to accept change are all examples of manipulation. If management threatens to close a manufacturing plant whose employees are resisting an across-the-board pay cut, and if the threat is actually unfounded, management is using manipulation. Cooptation, on the other hand, combines manipulation and participation. It seeks to buy off the leaders of a resistance group by giving them a key role, seeking their advice not to find a bet- ter solution but to get their endorsement. Both manipulation and cooptation are relatively inexpensive ways to gain the support of adversaries, but they can backfire if the targets become aware they are being tricked or used. Once that’s discovered, the change agent’s credibility may drop to zero. Selecting people Who accept Change Research suggests the ability to easily accept and adapt to change is related to personality—some people simply have more positive attitudes.21 Individuals who are open to experience, take a positive attitude toward change, are willing to take risks, and are flexible in their behav- ior are prime candidates. This seems to be universal. One study of managers in the United States, Europe, and Asia found those with a positive self-concept and high risk tolerance coped better with organizational change. A study of 258 police officers found those who were higher in the need for growth/develop- ment and internal work motivation, and who had an internal locus of control, held more positive attitudes about organizational change efforts.22 Individuals higher in general mental ability are also better able to learn and adapt to chang- es in the workplace.23 In sum, an impressive body of evidence shows organiza- tions can facilitate change by selecting people predisposed to accept it. Besides selecting individuals who are willing to accept changes, it is also pos- sible to select teams that are more adaptable. In general, teams that are strongly motivated by learning about and mastering tasks are better able to adapt to changing environments.24 It may thus be necessary to consider not just individ- ual motivation, but also group motivation, when trying to implement changes. Coercion Last on the list of tactics is coercion, the application of direct threats or force on the resisters. If management is determined to close a manufac- turing plant whose employees don’t acquiesce to a pay cut, the company is using coercion. Other examples include threatening employees with trans- fers, blocked promotions, negative performance evaluations, and poor letters of recommendation. Coercion is most effective when some force or pressure is enacted on at least some resisters—for instance, if an employee is publicly

Organizational Change and Stress Management CHAPTER 18 649 refused a transfer request, the threat of blocked promotions will become a real possibility in the minds of other employees. The advantages and drawbacks of coercion are approximately the same as for manipulation and cooptation. the politics of Change No discussion of resistance would be complete without a brief mention of the politics of change. Because change invariably threatens the status quo, it inher- ently implies political activity. Politics suggests the impetus for change is more likely to come from out- side change agents, employees new to the organization (who have less invested in the status quo), or managers slightly removed from the main power struc- ture. Managers who have spent a long time with an organization and achieved a senior position in the hierarchy are often major impediments to change. For them, change can be a very real threat to their status and position. Yet they may be expected to implement changes to demonstrate they’re not merely care- takers. By acting as change agents, they can convey to stockholders, suppliers, employees, and customers that they are addressing problems and adapting to a dynamic environment. Of course, as you might guess, when forced to introduce change, these longtime power holders tend to implement incremental changes. Radical change is often considered too threatening. This explains why boards of directors that recognize the imperative for rapid and radical change frequently turn to outside candidates for new leadership.25 18-3 Compare the four Approaches to Managing Organizational main approaches to Change managing organizational change. We now turn to several approaches to managing change: Lewin’s classic three- step model of the change process, Kotter’s eight-step plan, action research, and driving forces Forces that direct behavior organizational development. away from the status quo (Lewin). Lewin’s three-Step model restraining forces Forces that hinder movement from the existing equilibrium Kurt Lewin argued that successful change in organizations should follow three (Lewin). steps: unfreezing the status quo, movement to a desired end state, and refreezing the new change to make it permanent26 (see Exhibit 18-3). By definition, status quo is an equilibrium state. To move from equilib- rium—to overcome the pressures of both individual resistance and group con- formity—unfreezing must happen in one of three ways (see Exhibit 18-4). For one, the driving forces, which direct behavior away from the status quo, can be increased. For another, the restraining forces, which hinder movement away from equilibrium, can be decreased. A third alternative is to combine the first two approaches. Companies that have been successful in the past are likely to encounter restraining forces because people question the need for change.27 Exhibit 18-3 Lewin’s three-Step Change model Unfreezing Movement Refreezing

650 PART 4 The Organization System Exhibit 18-4 unfreezing the Status Quo Desired Restraining state forces Status quo Driving forces Time Once the movement stage begins, it’s important to keep the momentum going. Organizations that build up to change do less well than those that get to and through the movement stage quickly. When change has been implemented, the new situation must be refrozen so it can be sustained over time. Without this last step, change will likely be short-lived and employees will attempt to revert to the previous equilibrium state. The objective of refreezing, then, is to stabilize the new situation by balancing the driving and restraining forces. Kotter’s eight-Step plan John Kotter of Harvard Business School built on Lewin’s three-step model to create a more detailed approach for implementing change.28 Kotter began by listing common mistakes managers make when trying to initiate change. They may fail to create a sense of urgency about the need for change, a coalition for managing the change process, a vision for change and effectively communicate it, and/or to anchor the changes into the organization’s culture. They also may fail to remove obstacles that could impede the vision’s achievement and/or pro- vide short-term and achievable goals. Finally, they may declare victory too soon. Kotter established eight sequential steps to overcome these problems. They’re listed in Exhibit 18-5. Exhibit 18-5 Kotter’s eight-Step plan for implementing Change 1. Establish a sense of urgency by creating a compelling reason for why change is needed. 2. Form a coalition with enough power to lead the change. 3. Create a new vision to direct the change and strategies for achieving the vision. 4. Communicate the vision throughout the organization. 5. Empower others to act on the vision by removing barriers to change and encouraging risk taking and creative problem solving. 6. Plan for, create, and reward short-term “wins” that move the organization toward the new vision. 7. Consolidate improvements, reassess changes, and make necessary adjustments in the new programs. 8. Reinforce the changes by demonstrating the relationship between new behaviors and organizational success. Source: Based on M. du Plessis, “Re-implementing an Individual Performance Management System as a Change Intervention at Higher Education Institutions Overcoming Staff Resistance,” Proceedings of the 7th European Conference on Management Leadership and Governance, 2011, 105–15.

Organizational Change and Stress Management CHAPTER 18 651 action research A change process based Notice how Kotter’s first four steps essentially extrapolate Lewin’s “unfreez- on systematic collection of data and then ing” stage. Steps 5, 6, and 7 represent “movement,” and the final step works on selection of a change action based on what “refreezing.” So Kotter’s contribution lies in providing managers and change the analyzed data indicate. agents with a more detailed guide for successfully implementing change. organizational development (OD) action research A collection of planned change interventions, built on humanistic–democratic values, that Action research is a change process based on the systematic collection of data seeks to improve organizational effectiveness and selection of a change action based on what the analyzed data indicate.29 Its and employee well-being. value is in providing a scientific methodology for managing planned change. Action research consists of five steps (note how they closely parallel the scien- tific method): diagnosis, analysis, feedback, action, and evaluation. The change agent, often an outside consultant in action research, begins by gathering information about problems, concerns, and needed changes from members of the organization. This diagnosis is analogous to the physician’s search to find specifically what ails a patient. In action research, the change agent asks questions, reviews records, and interviews employees, actively listen- ing to their concerns. Diagnosis is followed by analysis. What problems do people key in on? What patterns do these problems seem to take? The change agent synthesizes this information into primary concerns, problem areas, and possible actions. Action research requires the people who will participate in a change pro- gram to help identify the problem and determine the solution. So the third step—feedback—requires sharing with employees what has been found from the first and second steps. The employees, with the help of the change agent, develop action plans for bringing about needed change. Now the action part of action research is set in motion. The employees and the change agent carry out the specific actions they have identified to correct the problem. The final step, consistent with the scientific underpinnings of action research, is evaluation of the action plan’s effectiveness, using the initial data gathered as a benchmark. Action research provides at least two specific benefits. First, it’s problem- focused. The change agent objectively looks for problems, and the type of prob- lem determines the type of change action. This is a process that makes intuitive sense. Unfortunately, this is too often not the case in reality. Change activities can become solution-centered and therefore erroneously predetermined. The change agent has a favorite solution—for example, implementing flextime, teams, or a process reengineering program—and then seeks out problems that the solution fits. A second benefit of action research is the lowering of resistance. Because action research engages employees so thoroughly in the process, it reduces resistance to change. Once employees have actively participated in the feedback stage, the change process typically takes on a momentum of its own. organizational Development Organizational development (OD) is a collection of change methods that try to improve organizational effectiveness and employee well-being.30 OD methods value human and organizational growth, collaborative and par- ticipative processes, and a spirit of inquiry.31 Contemporary OD borrows heavily from postmodern philosophy in placing heavy emphasis on the subjective ways people see and make sense of their work environment. The change agent may take the lead in OD, but there is a strong emphasis on collaboration. What are some OD techniques or interventions for bringing about change? Here are six.

652 PART 4 The Organization System sensitivity training Training groups that Sensitivity training A variety of names—sensitivity training, laboratory train- seek to change behavior through unstructured ing, encounter groups, and T-groups (training groups)—all refer to an early method of changing behavior through unstructured group interaction.32 group interaction. Current organizational interventions such as diversity training, executive coaching, and team-building exercises are descendants of this early OD inter- vention technique. In classic sensitivity training, members were brought together in a free and open environment in which participants discussed themselves and their interac- tive processes, loosely directed by a professional behavioral scientist who created the opportunity to express ideas, beliefs, and attitudes without taking any lead- ership role. The group was process oriented, which means individuals learned through observing and participating rather than being told. With all forms of OD, caution must be taken so the unstructured groups are not intimidating, chaotic, and damaging to work relationships. survey feedback The use of question- Survey feedback One tool for assessing the attitudes of organizational mem- naires to identify discrepancies among bers, identifying discrepancies among member perceptions, and solving differ- ences is the survey feedback approach.33 member perceptions; discussion follows, and Everyone in an organization can participate in survey feedback, but of key remedies are suggested. importance is the organizational “family”—the manager of any given unit and the employees who report directly to him or her. All usually complete a questionnaire about their perceptions and attitudes on a range of topics, including decision-making practices; communication effectiveness; coordi- nation among units; and satisfaction with the organization, job, peers, and immediate supervisor. Data from questionnaires are tabulated along with data pertaining to an individual’s specific “family” and the entire organization, and then distributed to employees. These data become the springboard for identifying problems and clarifying issues that may be creating difficulties for people. Particular attention is given to encouraging discussion and ensuring it focuses on issues and ideas, not on attacking individuals. For instance, are people listening? Are new ideas being generated? Can decision making, interpersonal relations, or job assign- ments be improved? Answers should lead the group to commit to various rem- edies for the problems. The survey feedback approach can be helpful to keep decision makers informed about the attitudes of employees toward the organization. However, individuals are influenced by many factors when they respond to surveys, which may make some findings unreliable. Second, a high number of nonresponses may indicate organizational dysfunction or decreased job satisfaction, which the absence of data will not show. Managers who use the survey feedback approach should therefore monitor their organization’s current events and employee response rates. process consultation (PC) A meeting in process Consultation Managers often sense their unit’s performance can be which a consultant assists a client in under- improved but are unable to identify what to improve and how. The purpose of process consultation (PC) is for an outside consultant to assist a client, usually a standing process events with which he or she manager, “to perceive, understand, and act upon process events” with which the manager must deal.34 These events might include workflow, informal relation- must deal and identifying processes that need ships among unit members, and formal communication channels. improvement. PC is similar to sensitivity training in assuming we can improve organiza- tional effectiveness by dealing with interpersonal problems and in emphasizing involvement. But PC is more task directed, and consultants do not solve the organization’s problems, but rather guide or coach the client to solve his or her own problems after jointly diagnosing what needs improvement. The client

Organizational Change and Stress Management CHAPTER 18 653 team building High interaction develops the skill to analyze processes within his or her unit and can therefore among team members to increase trust use the skill long after the consultant is gone. Because the client actively par- and openness. ticipates in both the diagnosis and the development of alternatives, he or she arrives at a greater understanding of the process and the remedy, and becomes intergroup development Organizational less resistant to the action plan chosen. development (OD) efforts to change the team Building We’ve noted throughout this text that organizations increasingly attitudes, stereotypes, and perceptions that rely on teams to accomplish work tasks. Team building uses high-interaction group groups have of each other. activities to increase trust and openness among team members, improve coordina- tive efforts, and increase team performance.35 Here, we emphasize the intragroup level, meaning within organizational families (command groups) as well as com- mittees, project teams, self-managed teams, and task groups. Team building typically includes goal-setting, development of interpersonal relations among team members, role analysis to clarify each member’s role and responsibilities, and team process analysis. It may emphasize or exclude certain activities, depending on the purpose of the development effort and the specific problems the team is confronting. Basically, however, team build- ing uses high interaction among members to increase trust and openness. In these times when organizations increasingly rely on teams, team building is an important topic. intergroup Development A major area of concern in OD is dysfunctional con- flict among groups. Intergroup development seeks to change groups’ attitudes, stereotypes, and perceptions about each other. Here, training sessions closely resemble diversity training, except rather than focusing on demographic differ- ences, they focus on differences among occupations, departments, or divisions within an organization. In one organization, for example, the engineers saw the accounting depart- ment as composed of shy and conservative types, and the HR department as having a bunch of “ultra-liberals more concerned that some protected group of employees might get their feelings hurt than with the company making a profit.” Such stereotypes can have an obvious negative impact on coordination efforts among departments. United Health Group employee volun- teers participate in a team-building activity that makes bicycles for chil- dren in need. The high-interaction project increases trust and deepens respect among employees, which transfers to better communication and cooperation in the workplace. Source: Tom Wallace/Minneapolis Star Tribune/MCT/ Landov

654 PART 4 The Organization System appreciative inquiry (AI) An approach Among several approaches for improving intergroup relations, a popular that seeks to identify the unique qualities and one emphasizes problem solving.36 Each group meets independently to list its perceptions of itself and another group and how it believes the other group special strengths of an organization, which perceives it. The groups then share their lists, discuss similarities and differ- ences, and look for causes of disparities. Are the groups’ goals at odds? Are can then be built on to improve performance. the perceptions distorted? On what basis were stereotypes formulated? Have some differences been caused by a misunderstanding of intentions? Have words and concepts been defined differently by each group? Answers to questions like these clarify the exact nature of the conflict. Once they have identified the causes of discrepancies, the groups move to the integration phase—developing solutions to improve relations between them. Subgroups can be formed of members from each of the conflicting groups to conduct further diagnoses and formulate alternative solutions. appreciative inquiry Most OD approaches are problem-centered. They iden- tify a problem or set of problems, then look for a solution. Appreciative inquiry (AI) instead accentuates the positive.37 Rather than looking for problems to fix, it seeks to identify the unique qualities and special strengths of an organization, which members can build on to improve performance. That is, AI focuses on an organization’s successes rather than its problems. The AI process consists of four steps—discovery, dreaming, design, and des- tiny—often played out in a large-group meeting over 2 to 3 days and overseen by a trained change agent. Discovery sets out to identify what people think are the organization’s strengths. Employees recount times they felt the organiza- tion worked best or when they specifically felt most satisfied with their jobs. In  dreaming, employees use information from the discovery phase to specu- late on possible futures, such as what the organization will be like in 5 years. In design, participants find a common vision of how the organization will look in the future and agree on its unique qualities. For the fourth step, participants seek to define the organization’s destiny or how to fulfill their dream, and they typically write action plans and develop implementation strategies. AI has proven an effective change strategy in organizations such as GTE, Roadway Express, and the U.S. Navy. American Express used AI to revitalize its culture during a lean economy. In workshops, employees described how they already felt proud of working at American Express and were encouraged to create a change vision by describing how it could be better in the future. The efforts led to some concrete improvements. Senior managers were able to use employees’ information to better their methods of making financial forecasts, improve IT investments, and create new performance-management tools for managers. The end result was a renewed culture focused on winning attitudes and behaviors.38 Try IT! If your professor has assigned this, go to the Assignments section of mymanagementlab.com to complete the Simulation: Change. 18-4 Demonstrate three ways Creating a Culture for Change of creating a culture for change. We’ve considered how organizations can adapt to change. But recently, some OB scholars have focused on a more proactive approach—how organizations can embrace change by transforming their cultures. In this section, we review

Organizational Change and Stress Management CHAPTER 18 655 three approaches: managing paradox, stimulating an innovative culture, and creating a learning organization. We also address the issue of organizational change and stress. paradox theory The theory that the key managing paradox paradox in management is that there is no In a paradox situation, we are required to balance tensions across various courses final optimal status for an organization. of action. There is a constant process of finding a balancing point, a dynamic equilibrium, among shifting priorities over time. Think of riding a bicycle: you must maintain forward momentum or you’ll fall over. From this perspective, there is no such thing as a separate discipline of “change management” because all management is dealing with constant change and adaptation. The idea of paradox sounds abstract, but more specific concepts have begun to emerge from a growing body of research.39 Several key paradoxes have been identified. Learning is a paradox because it requires building on the past while rejecting it at the same time. Organizing is a paradox because it calls for setting direction and leading while requiring empowerment and flexibility. Performing is a paradox between creating organization-wide goals to concentrate effort and recognizing the diverse goals of stakeholders inside and outside the organiza- tion. And finally, belonging is a paradox between establishing a sense of collective identity and acknowledging our desire to be recognized and accepted as unique individuals. Managers can learn a few lessons from paradox theory,40 which states the key paradox in management is that there is no final optimal status for an orga- nization.41 The first lesson is that as the environment and members of the organization change, different elements take on more or less importance. For example, sometimes a company needs to acknowledge past success and learn how it worked, while at other times looking backward will only hinder progress. There is some evidence that managers who think holistically and recognize the importance of balancing paradoxical factors are more effective, especially in generating adaptive and creative behavior in those they are managing.42 Stimulating a Culture of innovation How can an organization become more innovative? An excellent model is W. L. Gore, the $2.6-billion-per-year company best known as the maker of Gore- Tex fabric.43 Gore has developed a reputation as one of the most innovative U.S. companies by developing a stream of diverse products—including guitar strings, vacuum cleaner filters, industrial sealants, and fuel cell components. What’s the secret of Gore’s success? What can other organizations do to duplicate its track record for innovation? Gore pioneered a flat, unique lattice- type organizational structure (now termed an open allocation structure)44 run by employees (associates) working in self-organized project groups.45 Although there is no guaranteed formula, certain characteristics surface repeatedly when researchers study innovative organizations. They are structural, cultural, and human resource characteristics. Change agents should consider introducing these characteristics into their organizations to create an innovative climate. Let’s start by clarifying what we mean by innovation. innovation A new idea applied to initiating Definition of Innovation We said change refers to making things different. or improving a product, process, or service. Innovation, a specialized kind of change, is applied to initiating or improv- ing a product, process, or service; a better solution.46 So all innovations imply change, but not all changes introduce new ideas or lead to significant improve- ments. Innovations can range from incremental improvements, such as tablets, to radical breakthroughs, such as Nissan’s electric Leaf car.

656 PART 4 The Organization System Based on its motto “Think Different,” Apple has built a culture of innovation where employees share a passion for creating consumer friendly products like the Apple Watch, shown here displayed by a customer at an Apple store in Toronto, Canada. Apple’s supportive culture embraces cross- fertilization of ideas, collaboration, experimentation, and risk taking. Source: Ryan Emberley/Invision for Apple/AP Images Sources of innovation Structural variables are one potential source of innova- tion.47 A comprehensive review of the structure–innovation relationship leads to the following conclusions:48 1. Organic structures positively influence innovation. Because they’re lower in vertical differentiation, formalization, and centralization, organic organi- zations facilitate the flexibility, adaptation, and cross-fertilization that make the adoption of innovations easier. 2. Long tenure in management is associated with innovation. Managerial tenure can provide the legitimacy and knowledge of how to accomplish tasks and obtain desired outcomes through creative methods. 3. Innovation is nurtured when there are slack resources. Having an abun- dance of resources allows an organization to afford to purchase or develop innovations, bear the cost of instituting them, and absorb failures. 4. Interunit communication is high in innovative organizations.49 These orga- nizations are heavy users of committees, task forces, cross-functional teams, and other mechanisms that facilitate interaction across departmental lines. Context and innovation Innovative organizations tend to have similar cultures. They encourage experimentation and reward both successes and failures. They celebrate mistakes. Unfortunately, in too many organizations, people are rewarded for the absence of failures rather than for the presence of successes. Such cultures extinguish risk taking and innovation. People will suggest and try new ideas only when they feel such behaviors exact no penalties. Managers in innovative organizations recognize that failures are a natural by-product of venturing into the unknown. Within the human resources category, innovative organizations actively pro- mote the training and development of their members so they keep current, offer high job security so employees don’t fear getting fired for making mis- takes, and encourage individuals to become champions of change. These prac- tices should be mirrored for workgroups as well. One study of 1,059 individuals on over 200 different teams in a Chinese high-tech company found that work

Organizational Change and Stress Management CHAPTER 18 657 idea champions Individuals who take an systems emphasizing commitment to employees increased creativity in teams.50 innovation and actively and enthusiastically These effects were even greater in teams where there was cohesion among promote the idea, build support, overcome coworkers. resistance, and ensure that the idea is implemented. idea Champions and innovation Once a new idea has been developed, idea champions actively and enthusiastically promote it, build support, overcome learning organization An organization resistance, and ensure it is implemented.51 Champions often have similar per- that has developed the continuous capacity sonality characteristics: extremely high self-confidence, persistence, energy, and to adapt and change. a tendency to take risks. They usually display traits associated with transforma- tional leadership—they inspire and energize others with their vision of an in- novation’s potential and their strong personal conviction about their mission. Situations can also influence the extent to which idea champions are forces for change. For example, passion for change among entrepreneurs is greatest when work roles and the social environment encourage them to put their creative identities forward.52 On the flip side, work roles that push creative individuals to do routine management and administration tasks will diminish both the pas- sion for and implementation of change. Idea champions are good at gaining the commitment of others, and their jobs should provide considerable decision- making discretion. This autonomy helps them introduce and implement inno- vations53 when the context is supportive. Do successful idea champions do things differently in varied cultures? Yes.54 Generally, people in collectivist cultures prefer appeals for cross-functional sup- port for innovation efforts; people in high power-distance cultures prefer cham- pions to work closely with those in authority to approve innovative activities before work is begun; and the higher the uncertainty avoidance of a society, the more champions should work within the organization’s rules and procedures to develop the innovation. These findings suggest that effective managers will alter their organization’s innovation strategies to reflect cultural values. So, for instance, although idea champions in Russia might succeed by ignoring budget- ary limitations and working around confining procedures, champions in Aus- tria, Denmark, Germany, or other cultures high in uncertainty avoidance will be more effective by closely following budgets and procedures. Sergio Marcchione, CEO of Fiat-Chrysler, originally acted as an idea cham- pion for the single objective of updating the company’s product pipeline. To facilitate the change, he radically dismantled the bureaucracy, tearing up Chrysler’s organization chart and introducing a flatter structure with himself at the head. As a result, the company introduced a more innovative line of vehicles and planned to redesign or substantially refresh 75 percent of its lineup in 2010 alone.55 In 2014, Marchionne announced an ambitious plan to significantly increase the company’s U.S. auto sales through innovations in the product line. The organization is struggling to make his dreams a reality by 2018, but they remain committed to his goals. “We’ve always had something that came out of left field and made us very, very uncomfortable,” Marcchione said—the rallying cry for any idea champion.56 Creating a Learning organization Another way an organization can proactively manage change is to make con- tinuous growth part of its culture—to become a learning organization.57 What’s a Learning organization? Just as individuals learn, so too do organiza- tions. A learning organization has developed the continuous capacity to adapt and change. The Dimensions of the Learning Organization Questionnaire (DLOQ) has been adopted and adapted internationally to assess the degree of commitment to learning organization principles.58

658 PART 4 The Organization System Exhibit 18-6 Characteristics of a Learning organization 1. There exists a shared vision that everyone agrees on. 2. People discard their old ways of thinking and the standard routines they use for solving problems or doing their jobs. 3. Members think of all organizational processes, activities, functions, and interactions with the environment as part of a system of interrelationships. 4. People openly communicate with each other (across vertical and horizontal boundaries) without fear of criticism or punishment. 5. People sublimate their personal self-interest and fragmented departmental interests to work together to achieve the organization’s shared vision. Source: Based on P. M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Doubleday, 2006). Exhibit 18-6 summarizes the five basic characteristics of a learning organization—one in which people put aside their old ways of thinking, learn to be open with each other, understand how their organization really works, form a plan or vision everyone can agree on, and work together to achieve that vision.59 Proponents of the learning organization envision it as a remedy for three fundamental problems of traditional organizations: fragmentation, competi- tion, and reactiveness.60 First, fragmentation based on specialization creates “walls” and “chimneys” that separate different functions into independent and often warring fiefdoms. Second, an overemphasis on competition often under- mines collaboration. Managers compete to show who is right, knows more, or is more persuasive. Divisions compete when they ought to cooperate and share knowledge. Team leaders compete to show who the best manager is. And third, reactiveness misdirects management’s attention to solving problems rather than creating. The problem solver tries to make something go away, while a creator tries to bring something new into being. An emphasis on reactiveness to prob- lems pushes out innovation and continuous improvement and, in its place, encourages people to constantly run around “putting out fires.” managing Learning What can managers do to make their firms learning orga- nizations? Here are some suggestions: • Establish a strategy. Management needs to make explicit its commitment to change, innovation, and continuous improvement. • Redesign the organization’s structure. The formal structure can be a seri- ous impediment to learning. Flattening the structure, eliminating or combining departments, and increasing the use of cross-functional teams reinforces interdependence and reduces boundaries. • Reshape the organization’s culture. To become a learning organization, man- agers must demonstrate by their actions that taking risks and admitting failures are desirable. This means rewarding people who take chances and make mistakes. And management needs to encourage functional conflict. organizational Change and Stress Think about the times you have felt stressed during your work life. Look past the everyday stress factors that can spill over to the workplace, like a traffic jam that makes you late for work or a broken coffee machine that keeps you from your morning java. What were your more memorable and lasting stressful times at work? For many people, these were caused by organizational change.

Organizational Change and Stress Management CHAPTER 18 659 Researchers are increasingly studying the effects of organizational change on employees. We are interested in determining the specific causes and mitigating factors of stress to learn how to manage organizational change effectively. The overall findings are that organizational changes that incorporate OB knowledge of how people react to stressors may yield more effective results than organiza- tional changes that are managed only objectively through goal-setting plans.61 Not surprisingly, we also find the role of leadership is critical. One study indicated that transformational leaders can help shape employee affect so employees stay committed to the change and do not perceive it as stressful.62 Other research indicated that a positive orientation toward change before new initiatives are planned will decrease employees’ stress when they go through organizational changes and increase their positive attitudes. Managers can be continually working to increase employees’ self-efficacy, change-related attitudes, and perceived control over the situation to create this positive change orientation. For instance, they can use role clarification and continual rewards to increase self-efficacy, and they can enhance employees’ perceived control and positive attitudes toward change by including them from the planning stages to the application of new processes.63 Another study added the need for increas- ing the amount of communication to employees during change, assessing and enhancing employees’ psychological resilience through offering social support, and training employees in emotional self-regulation techniques.64 Through these methods, managers can help employees keep their stress levels low and their commitment high. Often, organizational changes are stressful because some employees per- ceive aspects of the changes as threatening. These employees are more likely to quit, partially in reaction to their stress. To reduce the perception of threat, employees need to perceive the organizational changes as fair. Research indi- cates that those who have a positive change orientation before changes are planned are less likely to perceive of changes as unfair or threatening. WATCh IT! If your professor has assigned this, go to the Assignments section of mymanagementlab.com to complete the video exercise titled East Haven Fire Department: Managing Stress. 18-5 Identify the potential Stress at Work environmental, organiza- tional, and personal Friends say they’re stressed from greater workloads and longer hours because of sources of stress at downsizing at their organizations. Parents worry about the lack of job stability work and the role of and reminisce about a time when a job with a large corporation implied lifetime individual and cultural security. Employees complain about the stress of trying to balance work and differences. family responsibilities. Harris, Rothenberg International, a leading provider of employee assistance programs (EAPs), finds that employees are having mental stress An unpleasant psychological breakdowns and needing professional help at higher rates than ever.65 Indeed, process that occurs in response to as Exhibit 18-7 shows, work is a major source of stress in most people’s lives. What are the causes and consequences of stress, and what can individuals and environmental pressures. organizations do to reduce it? What is Stress? Do you feel stressed? If so, join the crowd (see OB Poll). Stress is a dynamic condition in which an individual is confronted with an opportunity, demand, or resource related to what the individual desires and for which the outcome is

660 PART 4 The Organization System Exhibit 18-7 Work is a top Source of Stress What area of your life causes you the most stress? Area Causes Most Stress Financial worries 64% Work 60% Family responsibilities 47% Health concerns 46% Source: Stress in America: Paying with Our Health,” American Psychological Association, February 4, 2015, http://www.apa.org/news/ press/releases/stress/2014/stress-report.pdf. challenge stressors Stressors perceived to be both uncertain and important.66 This is a complicated defini- associated with workload, pressure to tion. Let’s look at its components more closely. complete tasks, and time urgency. Although stress is typically discussed in a negative context, it also has a positive purpose. In response to stress, your nervous system, hypothalamus, pituitary, and adrenal glands supply you with stress hormones to cope. Your heartbeat and breathing accelerate to increase oxygen, while your muscles tense for action.67 This is a time when stress offers potential gain. Consider, for example, the superior performance an athlete or stage performer gives in a “clutch” situation. Such individuals often use stress positively to rise to the occasion and perform at their maximum. Similarly, many professionals see the pressures of heavy workloads and deadlines as positive challenges that enhance the quality of their work and the satisfaction they get from their job. However, when the situation is negative, stress is harmful and may hinder your progress by elevating your blood pressure uncomfortably and creating an erratic heart rhythm as you struggle to speak and think logically.68 Stressors Researchers have argued that challenge stressors—or stressors associated with workload, pressure to complete tasks, and time urgency— Ob POLL Many employees Feel extreme stress What is your Low Extreme, with stress level? 5% accompanying symptoms 31% 64% Manageable Source: J. Hudson, “High Stress Has Employees Seeking Both Wellness and Employee Assistance Help,” ComPsych Corporation press release, November 12, 2014, http://www.compsych.com/press-room/press-releases-2014/818-nov-12-2014.

Organizational Change and Stress Management CHAPTER 18 661 hindrance stressors Stressors that keep operate quite differently from hindrance stressors—or stressors that keep you you from reaching your goals (for example, from reaching your goals (for example, red tape, office politics, confusion over red tape, office politics, confusion over job job responsibilities). Although research is just starting to accumulate, early evi- responsibilities). dence suggests challenge stressors produce less strain than hindrance stressors.69 demands Responsibilities, pressures, Researchers have sought to clarify the conditions under which each type of obligations, and even uncertainties that stress exists. It appears that employees who have stronger affective commitment individuals face in the workplace. to their organizations can transfer psychological stress into greater focus and resources Things within an individual’s higher sales performance, whereas employees with low levels of commitment control that can be used to resolve demands. perform worse under stress.70 And when challenge stress increases, those with high levels of organizational support realize higher role-based performance, allostasis Working to change behavior but those with low levels of organizational support do not.71 and attitudes to find stability. Demands and resources More typically, stress is associated with demands and resources. Demands are responsibilities, pressures, obligations, and uncertain- ties individuals face in the workplace. Resources are things within an individu- al’s control that he or she can use to resolve the demands. Let’s discuss what this demands–resources model means.72 When you take a test at school or undergo your annual performance review at work, you feel stress because you confront opportunities and performance pressures. A good performance review may lead to a promotion, greater respon- sibilities, and a higher salary. A poor review may prevent you from getting a promotion. An extremely poor review might even result in your being fired. To the extent you can apply resources to the demands on you—such as preparing for the review, putting the review in perspective (it’s not the end of the world), or obtaining social support—you will feel less stress. In fact, this last resource— social support—may be more important on an ongoing basis than anything else. According to recent research, people with emotional support may feel lower stress levels, less depressed from stress, and more likely to make lifestyle changes that may reduce stress.73 Overall, under the demands–resources perspective, having resources to cope with stress is just as important in offsetting stress as demands are in increasing it.74 allostasis All this may give you the impression that individuals are seeking a steady state in which demands perfectly match resources. While early research tended to emphasize such a homeostatic, or balanced equilibrium, perspective, it has now become clear that no single ideal state exists. Instead, it’s more accurate to talk about allostatic models in which demands shift, resources shift, and systems of addressing imbalances shift.75 By allostasis, we work to find stability by chang- ing our behaviors and attitudes. It all depends on the allostatic load, or the cumu- lative effect of stressors on us given the resources we draw upon.76 For example, if you’re feeling especially confident in your abilities and have lots of support from others, you may increase your willingness to experience strain and be better able to mobilize coping resources. This would be a situation where the allostatic load was not too great; in other cases where the allostatic load is too great and too pro- longed, we may experience psychological or physiological stress symptoms. There are also cycles in stress preferences. You’ve experienced this when you sometimes just feel like relaxing and recovering, while at other times you welcome more stimulation and challenge. So, much like organizations are in a constant state of change and flux, we respond to stress processes by continually adapting to both internal and external sources, and our stability is constantly redefined. potential Sources of Stress at Work What causes stress? Let’s examine the model in Exhibit 18-8.

662 PART 4 The Organization System Individual differences Consequences • Perception Exhibit 18-8 a model of Stress • Job experience Physiological symptoms • Social support • Immediate effects Potential sources • Personality traits • Illness • Chronic health conditions Environmental factors Experienced stress • Economic uncertainty Psychological symptoms • Political uncertainty Cultural differences • Anxiety • Technological change • Lower emotional well-being • Lower job satisfaction Organizational factors • Task demands Behavioral symptoms • Role demands • Lower job performance • Interpersonal demands • Higher absenteeism • Higher turnover Personal factors • Family problems • Economic problems environmental factors Just as environmental uncertainty influences the design of an organization’s structure, it also influences stress levels among employees in that organization. Indeed, uncertainty is the biggest reason people have trou- ble coping with organizational changes.77 There are three main types of envi- ronmental uncertainty: economic, political, and technological. Changes in the business cycle create economic uncertainties. When the econ- omy is contracting, for example, people become increasingly anxious about their job security. Political uncertainties don’t tend to create stress among North Americans as much as they do for employees in countries such as Haiti or Ven- ezuela. The obvious reason is that the United States and Canada have more stable political systems, in which change is typically implemented in an orderly manner. Yet political threats and changes in all countries can induce stress. Because innovations can make an employee’s skills and experience obsolete in a very short time, keeping up with new computer programs, robotics, automa- tion, and similar forms of technological change are a further challenge to many people at work that cause them stress. organizational factors There is no shortage of factors within an organization that can cause stress. Pressures to avoid errors or complete tasks in a limited time, work overload, a demanding and insensitive boss, and unpleasant cowork- ers are a few examples. We’ve categorized these factors around task, role, and interpersonal demands. Task demands relate to a person’s job. They include the design of the job (including its degree of autonomy, task variety, and automation), working conditions, and the physical work layout. The single factor most consistently related to stress in the workplace is the amount of work that needs to be done, followed closely by the presence of looming deadlines.78 Working in an overcrowded room or a visible location where noise and interruptions are con- stant can also increase anxiety and stress.79 As we discussed in earlier chapters, emotional labor causes stress.

Organizational Change and Stress Management CHAPTER 18 663 Role demands relate to pressures placed on a person as a function of the particular role he or she plays in the organization. Role conflicts create expec- tations that may be hard to reconcile or satisfy. Role overload occurs when the employee is expected to take on too much. Role ambiguity means role expecta- tions are not clearly understood and the employee is not sure what to do. Unfor- tunately, individuals who face high situational constraints by their roles (such as fixed work hours or demanding job responsibilities) are less able to engage in the proactive coping behaviors, like taking a break, that reduce stress levels.80 When faced with hassles at work, they will not only have higher levels of distress at the time, but they’ll also be less likely to take steps to eliminate stressors in the future. Interpersonal demands are pressures created by other employees. Some pres- sures are expected, but a rapidly growing body of research has shown that negative coworker and supervisor behaviors, including fights, bullying, incivil- ity, racial harassment, and sexual harassment, are especially strongly related to stress at work.81 Interpersonal mistreatment can have effects at a physiologi- cal level, with one study finding that unfair treatment in a controlled setting triggered the release of cortisol, a hormone involved in the stress-reaction process.82 Furthermore, individuals who believe they are experiencing a social climate of discrimination from multiple sources over time have higher levels How can i bring my team’s overall stress level down? Career oBjectives My coworkers and I are under a lot goal. Shared objectives are one of move the group forward. A combination of pressure because we have a huge the most effective ways to reduce of focus, progress, and perspective will deadline coming up. We’re working a conflict in times of stress, and they ultimately be the best approach to lim- lot of extra hours, and tensions are remind everyone that cooperation iting your stress. starting to ramp up to arguments. Is is key. there any way I can get my team to • Review what the team has done and Sources: P. M. Poortvliet, F. Anseel, and F. chill out? what steps toward the goal remain. Theuwis, “Mastery-Approach and Mastery- When the team can see how much Avoidance Goals and Their Relation with — Hakim work they have accomplished, they Exhaustion and Engagement at Work: The Dear Hakim: will naturally feel better. Roles of Emotional and Instrumental Sup- It sounds like you’re facing some of • When the team feels most tense, port,” Work & Stress 29 (April 2015): 150– the core issues that produce stress take a collective temporary break. It 70; J. P. Trougakos, D. J. Beal, B. H. Cheng, I. at work: high demands, critical out- can be difficult to step away from a Hideg, and D. Zweig, “Too Drained to Help: A comes, and time pressure. There’s no project with heavy time demands, Resource Depletion Perspective on Daily In- question tempers can start to flare but working at a point of maximum terpersonal Citizenship Behaviors,” Journal under these conditions. While it may tension and conflict is often coun- of Applied Psychology 100 (2015): 227–36; not even be desirable to get your team terproductive. A chance to stop and and J. P. Trougakos, I. Hideg, B. H. Cheng, to relax, or chill out as you say, lower- gain perspective will help everyone and D. J. Beal, “Lunch Breaks Unpacked: ing your team’s aggregate stress level recharge and focus. The Role of Autonomy as a Moderator of Re- will increase your group’s effective- covery during Lunch,” Academy of Manage- ness. Fortunately, there are some well- Remember that minimizing team ment Journal 57 (2014): 405–21. established ways to help lower stress stress shouldn’t happen through low- in groups. Some of the most effective ering standards and accepting lower- The opinions provided here are of the manag- are directly related to getting people to quality work, but by reducing counter- ers and authors only and do not necessar- recommit to the team: productive organizational behavior. A ily reflect those of their organizations. The positive work environment with high authors or managers are not responsible for • To help minimize infighting, get member engagement will do a lot to any errors or omissions, or for the results the group to focus on a common obtained from the use of this information. In no event will the authors or managers, or their related partnerships or corporations thereof, be liable to you or anyone else for any decision made or action taken in reliance on the opinions provided here.

664 PART 4 The Organization System of psychological strain, even after accounting for differing baseline levels of well-being.83 Social exclusion, perhaps as a form of interpersonal mistreatment, can also be a significant source of psychological strain. One study found that experiences of ostracism may have even more negative effects than experiences of interpersonal conflict.84 personal factors The typical individual may work between 40 and 50 hours a week. But the experiences and problems people encounter in the other 120- plus hours can spill over to the job. The final category of sources of stress at work includes factors of an employee’s personal life: family issues and personal economic problems. National surveys consistently show people hold family and personal rela- tionships dear. Family issues, even good ones, can cause stress that significantly impacts individuals. Family issues are often closely related to work–life conflict. Regardless of income level, some people are poor money managers or have wants that exceed their earning capacity. People who make $100,000 per year seem to have as much trouble handling their finances as those who earn $20,000, although recent research indicates that those who make under $50,000 per year do experience more stress.85 The personal economic problems of overex- tended financial resources create stress and siphon attention away from work. Stressors are additive When we review stressors individually, it’s easy to overlook that stress is an additive phenomenon—it builds up.86 Each new and persistent stressor adds to an individual’s stress level. So a single stressor may be relatively unimportant in and of itself, but if added to an already high level of stress, it can be too much. To appraise the total amount of stress an indi- vidual is under, we have to sum up all of the sources and severity levels of that person’s stress. Since this cannot be easily quantified or observed, managers should remain aware of the potential stress loads from organizational factors in particular. Many employees are willing to express their perceived stress load at work to a caring manager. individual Differences Some people thrive on stressful situations, while others are overwhelmed by them. What differentiates people in terms of their ability to handle stress? What individual variables moderate the relationship between potential stressors and experienced stress? At least four are relevant—perception, job experience, social support, and personality traits. perception In Chapter 6, we demonstrated that employees react in response to their perception of reality, rather than to reality itself. Perception, therefore, will moderate the relationship between a potential stress condition and an em- ployee’s reaction to it. Layoffs may cause one person to fear losing his job, while another sees an opportunity to get a large severance allowance and start her own business. So stress potential doesn’t lie in objective conditions; rather, it lies in an employee’s interpretation of those conditions. Job experience Experience on the job tends to be negatively related to work stress. Why? Two explanations have been offered.87 First is selective withdraw- al. Voluntary turnover is more probable among people who experience more stress. Therefore, people who remain with an organization longer are those with more stress-resistant traits or those more resistant to the stress characteris- tics of the organization. Second, people eventually develop coping mechanisms

Organizational Change and Stress Management CHAPTER 18 665 DentalPlans.com employee Kristen Reineke celebrates after scoring a point while playing foosball in the employee lounge. In giving its employ- ees the opportunity to form collegial relationships by playing games like foosball and Wii, DentalPlans provides them with the social support that can lessen the impact of on-the-job stress. Source: Charles Trainor Jr/MCT/Newscom to deal with stress. Because this takes time, senior members of the organization are more likely to be fully adapted and should experience less stress. Social Support Social support—collegial relationships with coworkers or super- visors—can buffer the impact of stress.88 This is among the best-documented relationships in the stress literature. Social support acts as a palliative, mitigating the negative effects of even high-strain jobs. personality traits Stress symptoms expressed on the job may originate in the person’s personality.89 Perhaps the most widely studied personality trait in research on stress is neuroticism, which we discussed in Chapter 5. As you might expect, neurotic individuals are more prone to experience psychologi- cal strain.90 Evidence suggests that neurotic individuals are more likely to find stressors in their work environments, so they believe their environments are more threatening. They also tend to select less adaptive coping mechanisms, relying on avoidance as a way of dealing with problems rather than attempting to resolve them.91 Workaholism is another personal characteristic related to stress levels. Work- aholics are people obsessed with their work; they put in an enormous number of hours, think about work even when not working, and create additional work responsibilities to satisfy an inner compulsion to work more. In some ways, they might seem like ideal employees. That’s probably why when most people are asked in interviews what their greatest weakness is, they reflexively say, “I just work too hard.” However, there is a difference between working hard and work- ing compulsively. Workaholics are not necessarily more productive than other employees, despite their extreme efforts. The strain of putting in such a high level of work effort eventually begins to wear on the person, leading to higher levels of work–life conflict and psychological burnout.92 Cultural Differences Research suggests the job conditions that cause stress show some differences across cultures. One study revealed that whereas U.S. employees were stressed

666 PART 4 The Organization System by a lack of control, Chinese employees were stressed by job evaluations and lack of training. It doesn’t appear that personality effects on stress are dif- ferent across cultures, however. One study of employees in Hungary, Italy, the United Kingdom, Israel, and the United States found Type A personality traits (see Chapter 5) predicted stress equally well across countries.93 A study of 5,270 managers from 20 countries found individuals from individualis- tic countries such as the United States, Canada, and the United Kingdom experienced higher levels of stress due to work interfering with family than did individuals from collectivist countries in Asia and Latin America.94 The authors proposed that this may occur because, in collectivist cultures, working extra hours is seen as a sacrifice to help the family, whereas in individualistic cultures, work is seen as a means to personal achievement that takes away from the family. Evidence suggests that stressors are associated with perceived stress and strains among employees in different countries. In other words, stress is equally bad for employees of all cultures.95 18-6 Identify the physiologi- Consequences of Stress at Work cal, psychological, and behavioral symptoms of Stress shows itself in a number of ways, such as high blood pressure, ulcers, stress at work. irritability, difficulty making routine decisions, changes in appetite, acci- dent proneness, and the like. Refer back to Exhibit 8-8. These symptoms fit under three general categories: physiological, psychological, and behavioral symptoms. physiological Symptoms Most early concern with stress was directed at physi- ological symptoms because most researchers were specialists in the health and medical sciences. Their work led to the conclusion that stress could create changes in metabolism, increase heart and breathing rates and blood pressure, bring on headaches, and induce heart attacks. Evidence now clearly suggests stress may have other harmful physiological effects. A long-term study conducted in the United Kingdom found that job strain was associated with higher levels of coronary heart disease.96 Still another study conducted with Danish human services workers found that higher levels of psychological burnout at the work-unit level were related to significantly higher levels of sickness absence.97 Many other studies have shown similar results link- ing work stress to a variety of indicators of poor health. psychological Symptoms Job dissatisfaction is an obvious cause of stress. But stress shows itself in other psychological states—for instance, tension, anxiety, irritability, boredom, and procrastination. One study that tracked physiological responses of employees over time found that stress due to high workloads was related to lower emotional well-being.98 Jobs that make multiple and conflicting demands or that lack clarity about the incumbent’s duties, authority, and responsibilities increase both stress and dissatisfaction.99 Similarly, the less control people have over the pace of their work, the greater their stress and dissatisfaction. Jobs that provide a low level of variety, significance, autonomy, feedback, and identity appear to create stress and reduce satisfaction and involvement in the job.100 Not everyone reacts to autonomy in the same way, however. For those with an external locus of control, increased job control increases the tendency to experience stress and exhaustion.101

Organizational Change and Stress Management CHAPTER 18 667 When You’re Working Hard, sleep is Optional myth or Science? T his is false. Individuals who do not age 30 to 45, and 38 percent age 46 to of U.S. adults consume caffeine every get enough sleep are unable to 64 report that they rarely or never get a day), require the ingestion of increas- perform well on the job. One study good nightly rest on weekdays. ing amounts to achieve alertness, found that sleeplessness costs U.S. which can make users jittery before employers $63.2 billion per year, almost Research has shown that lack of the effect wears off and leave them $2,300 per employee, partially due to sleep impairs our ability to learn skills exhausted. decreased productivity and increased and find solutions, which may be part safety issues. Sleep deprivation has of the reason law-enforcement orga- When you’re working hard, it’s easy been cited as a contributing factor in nizations, Super Bowl-winning football to consider using sleep hours to get the heart disease, obesity, stroke, and teams, and half the Fortune 500 compa- job done, and to think that the stress cancer. It can also lead to disastrous nies employ “fatigue management spe- and adrenaline from working will keep accidents. For example, U.S. military re- cialists” as performance consultants. you alert. It’s also easy to consider searchers report that sleep deprivation artificial methods in attempts to coun- is one of the top causes of friendly fire Along with sleeplessness, insomnia teract the negative impact of sleep (when soldiers mistakenly fire on their has been a growing problem. Recent deprivation. However, research indi- own troops), and 20 percent of auto ac- research in Norway indicated that up cates that when it comes to maximizing cidents are due to drowsy drivers. More to 34 percent of motor vehicle deaths performance and reducing accidents, than 160 people on Air India Flight 812 during their 14-year study period might we are not good at assessing our im- from Dubai to Mangalore were killed have been prevented if there hadn’t paired capabilities when we are sleep when pilot Zlatko Glusica awoke from been insomnia symptoms of people in- deprived. In the end, there is no substi- a nap and, suffering from sleep inertia, volved in the crashes. Managers and tute for a solid night’s sleep. overshot the runway in one of India’s employees increasingly take prescrip- deadliest air crashes. tion sleep aids, attend sleep labs, and Sources: M. J. Breus, “Insomnia Could Kill consume caffeine in efforts to either You—By Accident,” The Huffington Post, May Sleeplessness is affecting the per- sleep better or reduce the effects of 9, 2015, http://www.huffingtonpost.com/ formance of millions of workers. Ac- sleeplessness on their performance. dr-michael-j-breus/insomnia-could-kill-you-by- cording to research, one-third of U.S. These methods often backfire. Stud- accident_b_7235264.html; D. K. Randall, employees in most industries, and ies indicate that prescription sleep “Decoding the Science of Sleep,” The Wall more than one-quarter of workers in aids increase sleep time by only 11 Street Journal, August 4–5, 2012, C1–C2; the finance and insurance industry, minutes and cause short-term memory M. Sallinen, J. Onninen, K. Tirkkonen, M.-L. are sleep deprived, getting fewer than loss. The effects of sleep labs may not Haavisto, M. Harma, T. Kubo, et al., “Effects 6 hours of sleep per night (7 to 9 are be helpful after the sessions are over. of Cumulative Sleep Restriction on Self- recommended). More than 50 percent And the diminishing returns of caffeine, Perceptions While Multitasking,” Journal of of U.S. adults age 19 to 29, 43 percent perhaps the most popular method of Sleep Research, June 2012, 273–81; and P. fighting sleep deprivation (74 percent Walker, “Pilot Was Snoring before Air India Crash,” The Guardian, November 17, 2010, www.guardian.co.uk/world/2010/nov/17/ sleepy-pilot-blamed-air-india-crash. Behavioral Symptoms Research on behavior and stress has been conducted across several countries and over time, and the relationships appear relatively consistent. Behavior-related stress symptoms include reductions in productivity; increases in absences and turnover; and personal changes in eating habits, in- creased smoking or consumption of alcohol, rapid speech, fidgeting, and sleep disorders.102 A significant amount of research has investigated the stress–performance relationship. One proposed pattern of this relationship is the inverted U shown in Exhibit 18-9.103 The logic underlying the figure is that low to moderate levels of stress stimulate the body and increase its ability to react. Individuals may per- form tasks better, more intensely, or more rapidly. But too much stress places unattainable demands on a person, which result in lower performance. In spite of its popularity and intuitive appeal, the inverted-U model hasn’t earned a lot

668 PART 4 The Organization System Exhibit 18-9 the proposed inverted-u relationship between Stress and Job performance High Performance Low Stress High Low 18-7 Describe individual of empirical support.104 It may be that the model misses links between stressors and organizational and felt stress and job performance, meaning that sometimes there are reasons approaches to we could be stressed but feel fine because of positive moderating factors. We managing stress may be able to not let stress affect our job performance.105 For example, one at work. study indicated that individuals with high emotional intelligence (EI, discussed in Chapter 4) may be able to mitigate the effects of job stress on performance.106 Therefore, this model may be a good, neutral starting point from which to study differences. As we mentioned earlier, researchers have begun to differentiate challenge and hindrance stressors, showing that these two forms of stress have oppo- site effects on job behaviors, especially job performance. A meta-analysis of responses from more than 35,000 individuals showed role ambiguity, role con- flict, role overload, job insecurity, environmental uncertainty, and situational constraints were all consistently negatively related to job performance.107 There is also evidence that challenge stress improves job performance in a supportive work environment, whereas hindrance stress reduces job performance in all work environments.108 Managing Stress What should we do about stress? Should we do anything? Because low to mod- erate levels of stress can be functional and lead to higher performance, man- agement may not be concerned when employees experience them. Employees, however, are likely to perceive even low levels of stress as undesirable. It’s not unlikely, therefore, for employees and management to have different notions of what constitutes an acceptable level of stress on the job. What management may consider to be “a positive stimulus that keeps the adrenaline running” is very likely to be seen as “excessive pressure” by the employee. Keep this in mind as we discuss individual and organizational approaches toward managing stress.109 individual approaches An employee can and should take personal responsibility for reducing stress lev- els. Individual strategies that have proven effective include time-management techniques, physical exercise, relaxation techniques, and social support networks.

Organizational Change and Stress Management CHAPTER 18 669 Many people manage their time poorly. The well-organized employee, like the well-organized student, can often accomplish twice as much as the person who is poorly organized. A few of the best-known time-management techniques are: (1) maintaining to-do lists, (2) scheduling activities based on priorities, not what you can accomplish, (3) doing the hard tasks first, and (4) blocking out distraction-free time to accomplish tasks. These time- management skills can help minimize procrastination by focusing efforts on immediate goals and boosting motivation even in the face of tasks that are less enjoyable.110 Physicians have recommended noncompetitive physical exercise, such as aero- bics, walking, jogging, swimming, and riding a bicycle, as a way to deal with excessive stress levels. These activities decrease the detrimental physiological responses to stress and allow us to recover from stress more quickly.111 Individuals can teach themselves to reduce tension through relaxation tech- niques such as meditation, hypnosis, and deep breathing. The objective is to reach a state of deep physical relaxation, in which you focus all your energy on the release of muscle tension.112 Deep relaxation for 15 or 20 minutes a day releases strain and provides a pronounced sense of peacefulness, as well as significant changes in heart rate, blood pressure, and other physiological fac- tors. A growing body of research shows that simply taking breaks from work at routine intervals can facilitate psychological recovery and reduce stress signifi- cantly and may improve job performance, and these effects are even greater if relaxation techniques are employed.113 As we have noted, friends, family, or work colleagues can provide an outlet when stress levels become excessive. Expanding your social support network pro- vides someone to hear your problems and offer a more objective perspective on a stressful situation than your own. organizational approaches Several organizational factors that cause stress—particularly task and role demands—are controlled by management and thus can be modified or changed. Strategies to consider include improved employee selection and job placement, training, goal-setting, redesign of jobs, increased organizational communication, employee involvement, employee sabbaticals, and corporate wellness programs. Selection and placement, and training Certain jobs are more stressful than others but, as we’ve seen, individuals differ in their response to stressful situations. We know individuals with little experience or an external locus of control tend to be more prone to stress. Selection and placement decisions should take these facts into consideration. Obviously, management shouldn’t hire only experienced individuals with an internal locus, but such individuals may adapt better to high-stress jobs and perform those jobs more effectively. Similarly, training can increase an individual’s self-efficacy and thus lessen job strain. goal-Setting We discussed goal-setting in Chapter 7. Individuals perform better when they have specific and challenging goals and receive feedback on their progress toward these goals. Goals can reduce stress as well as provide motiva- tion.114 Employees who are highly committed to their goals and see purpose in their jobs experience less stress because they are more likely to perceive stress- ors as challenges rather than hindrances. Specific goals perceived as attainable clarify performance expectations. In addition, goal feedback reduces uncertain- ties about actual job performance. The result is less employee frustration, role ambiguity, and stress.

670 PART 4 The Organization System Manager and employee stress during an ethical Choice Organizational change cutting non-workforce costs to maintain W hen organizations are in a state that continually occurring job stress- profitability. Smaller methods, such as of change, employees feel the ors, such as when organizations are in teaching employees stress reduction stress. In fact, a recent study the midst of change, reduce employee techniques and creating a “greenery indicated that job pressures, often due engagement because workers are de- room” for a nature retreat from the to downsizing and other organizational prived of recovery periods. Employee office environment, can also be help- changes, are the second-leading cause stress thus needs to be addressed pro- ful. Managers must make the ethical of stress. Dealing with that stress was actively at the manager level if it is to choice between spending more money previously in the domain of workers be effective, before there are negative now on labor costs and stress reduc- alone, who could turn to constructive work outcomes. Are managers ethically tion methods, versus later on the more (counselors, health professionals, sup- obligated to alleviate employee stress? hidden but salient costs of employee port networks) or destructive (alcohol, stress. gossip, counterproductive work behav- On the one hand, managers are re- iors) options as coping mechanisms. sponsible for maximizing productivity As research increasingly indicates, Employees who couldn’t cope with and realize that organizations increase when employees react to stress, they stress suffered job burnout and headed profitability when fewer employees and their organizations suffer the con- to the unemployment line. perform increased work. On the other sequences. Managers must, therefore, hand, overwork will increase employee consider their opportunity to help allevi- Beneficent employers provided stress, particularly when the organiza- ate the stress before it’s too late. employee assistance programs (EAP) tion is in a state of change due to down- through subcontracted counselors or sizing or growth. Managers who keep Sources: E. Frauenheim, “Stressed & in-house HR departments to counsel head count low and workloads high Pressed,” Workforce Management, January employees dealing with stress. Manag- may realize short-term gains from lower 2012, 18–22; J. B. Oldroyd and S. S. Morris, ers simply steered individuals toward workforce costs but long-term losses “Catching Falling Stars: A Human Resource these resources when workplace prob- from negative stress outcomes, such Responses to Social Capital’s Detrimental lems indicated a need for intervention. as increased turnover and lowered Effect of Information Overload on Star Em- This help often arrived too late to miti- productivity. Experts recommend that ployees,” Academy of Management Review gate the negative outcomes of stress managers consider hiring the workers 37 (2012): 396–418; and S. Sonnentag, such as lost productivity and burn- they need to keep employee workloads E. J. Mojza, E. Demerouti, and A. B. Bakker, out—and sometimes too late to save reasonable, adding reward programs “Reciprocal Relations between Recovery the employee’s job. Research suggests to keep top employees engaged, and and Work Engagement: The Moderating Role of Job Stressors,” Journal of Applied Psychol- ogy 97 (2012): 842–53. redesigning Jobs Redesigning jobs to give employees more responsibility, more meaningful work, more autonomy, and increased feedback can reduce stress because these factors give employees greater control over work activities and lessen dependence on others. But as we noted in our discussion of work design, not all employees want enriched jobs. The right redesign for employees with a low need for growth might include less responsibility and increased specializa- tion. If individuals prefer structure and routine, reducing skill variety should reduce uncertainties and stress levels. employee involvement Role stress is detrimental to a large extent because em- ployees feel uncertain about goals, expectations, how they’ll be evaluated, and the like. By giving these employees a voice in the decisions that directly affect their job performance, management can increase employee control and reduce role stress. Thus, managers should consider increasing employee involvement in decision making because evidence clearly shows that increases in employee em- powerment reduce psychological strain.115

Organizational Change and Stress Management CHAPTER 18 671 wellness programs Organizationally organizational Communication Increasing formal organizational communication supported programs that focus on the with employees reduces uncertainty by lessening role ambiguity and role con- flict. Given the importance that perceptions play in moderating the stress–re- employee’s total physical and mental sponse relationship, management can also use effective communications as a means to shape employee perceptions. Remember that what employees catego- condition. rize as demands, threats, or opportunities at work is an interpretation and that interpretation can be affected by the symbols and actions communicated by management. employee Sabbaticals Some employees need an occasional escape from the frenetic pace of their work. Companies including Genentech, American Express, Intel, General Mills, Microsoft, Morningstar, DreamWorks Anima- tion, and Adobe Systems have begun to provide extended voluntary leaves.116 These sabbaticals—ranging in length from a few weeks to several months— allow employees to travel, relax, or pursue personal projects that consume time beyond normal vacations. Proponents say sabbaticals can revive and rejuvenate workers who might otherwise be headed for burnout. Wellness programs Our final suggestion is organizationally supported wellness programs. These typically provide workshops to help people quit smoking, control alcohol use, lose weight, eat better, and develop a regular exercise pro- gram; they focus on the employee’s total physical and mental condition.117 Some programs help employees improve their psychological health as well. A meta-analysis of 36 programs designed to reduce stress (including wellness programs) showed that interventions to help employees reframe stressful situa- tions and use active coping strategies appreciably reduced stress levels.118 Most wellness programs assume employees need to take personal responsibility for their physical and mental health and that the organization is merely a means to that end. Corporate wellness programs can help employees manage stress. As part of its wellness and fitness initiatives, the Fowler White Boggs law firm brings in yoga instructors during employees’ lunch hours to lead them in stretch- ing and breathing exercises that help relieve stress and promote a sense of well-being. Source: ZUMA Press, Inc/Alamy

672 PART 4 The Organization System Most firms that have introduced wellness programs have found significant benefits. Johnson & Johnson reported that their wellness program has saved the organization $250 million on health care costs in 10 years, and research indicated that effective wellness programs significantly decreased turnover rates for most organizations.119 Other research sponsored by the U.S. Depart- ment of Labor and Department of Health and Human Services indicated that organizational wellness programs create healthier employees with fewer health risk factors.120 Summary The need for change has been implied throughout this text. For instance, think about attitudes, motivation, work teams, communication, leadership, organiza- tional structures, HR practices, and organizational cultures. Change was an inte- gral part in our discussion of each. If environments were perfectly static, if em- ployees’ skills and abilities were always up to date and incapable of deteriorating, and if tomorrow were always exactly the same as today, organizational change would have little or no relevance to managers. But the real world is turbulent, re- quiring organizations and their members to undergo dynamic change if they are to perform at competitive levels. Coping with all these changes can be a source of stress, but with effective management, challenge can enhance engagement and fulfillment, leading to the high performance that, as you’ve discovered in this text, is one major goal of the study of organizational behavior (OB). Implications for Managers ●● Consider that, as a manager, you are a change agent in your organization. The decisions you make and your role-modeling behaviors will help shape the organization’s change culture. ●● Your management policies and practices will determine the degree to which the organization learns and adapts to changing environmental factors. ●● Some stress is good. Increasing challenges brought by autonomy and re- sponsibility at work will lead to some stress but also increase feelings of accomplishment and fulfillment. Hindrance stressors like bureaucracy and interpersonal conflicts, on the other hand, are entirely negative and should be eliminated. ●● You can help alleviate harmful workplace stress for your employees by accurately matching workloads to employees, providing employees with stress-coping resources, and responding to their concerns. ●● You can identify extreme stress in your employees when performance declines, turnover increases, health-related absenteeism increases, and engagement declines. However, by the time these symptoms are visible, it may be too late to be helpful, so stay alert for early indicators and be proactive. PeRSOnAL InvenTORy ASSeSSMenTS P I A PERSONAL INVENTORY Tolerance of Ambiguity Scale ASSESSMENT How well can you tolerate the ambiguity that change brings? Take this PIA to learn more about your tolerance level for this challenge.

Organizational Change and Stress Management CHAPTER 18 673 companies should encourage stress reduction POInt COunterPOInt Companies make substantial investments in their employees, so W hile employers may have a direct financial interest in certain the health and well-being of the workforce is a central concern. elements of stress reduction, it’s worth asking whether in- One of the most direct ways to provide assistance to employees vesting in stress reduction programs is actually a good idea. is to engage in one of the stress-reduction interventions. The first problem is operational. Some stress reduction interven- tions are expensive, requiring professional facilitators or exercise One major financial benefit of stress reduction programs is a re- equipment. These can take a long time to show financial returns, and duction in health-related costs. Workplace stress leads to dozens of the up-front costs of researching, designing, and implementing them negative and expensive health-related consequences. Stress weakens are substantial. A growing number of corporations report that the the immune system, leading to increased illness and sickness ab- expected returns on investment in wellness programs have failed to sences. If employees feel extreme stress related to work, they may be materialize. And the time employees spend in stress reduction inter- more likely to come in when they are contagious, leading to sickness ventions is time they spend not working. for many others. Over the longer run, stress levels also can contribute to conditions like heart disease that ultimately result in very expensive Another problem is that stress reduction programs are invasive. medical treatments. These medical treatments, in turn, increase em- Should your boss or other individuals in the workplace tell you how ployer health insurance expenses. you’re supposed to feel? Many stress reduction programs step even further into employees’ personal lives by encouraging open discus- Reductions in employee stress can facilitate job performance. em- sions about sources of stress. Do you really want your manager and ployees who are overburdened have difficulty concentrating, can lose coworkers to know why you’re experiencing stress? The more that sen- energy and motivation at work, and find it difficult to come up with new sitive topics related to stress are discussed, the harder it is to keep and creative ideas. Stress can also create conflicts with coworkers and work relationships professional. lead to rude or hostile treatment of clients or customers. Ultimately, employees who are experiencing high levels of stress may leave, so all A final concern is that it is too hard to draw the line between the costs attendant upon turnover are incurred. stress from work and general life stress. A company’s stress reduc- tion program may try to target problems of work overload or social Stress reduction programs also have an ethical component. The conflict, but these issues often affect other areas of life. How should workplace generates a great deal of stress for many employees, so a stress reduction program operate when the reasons for employee employers have a certain responsibility to offset its negative conse- stress come, say, from a sick relative or conflicts with family members? quences. Stress reduction programs are a direct way to help employ- ees feel better. Finally, when employers show concern for employees by Organizations often mean well, but it may be more important to let helping reduce stress, employees feel more committed. employees keep their private lives private. Sources: L. vanderkam, “The Dark Side of Corporate Wellness Programs,” Fast Company, June 8, 2015, http://www .fastcompany.com/3047115/the-dark-side-of-corporate-wellness-programs; D. R. Stover and J. Wood, “Most Company Wellness Programs Are a Bust,” Gallup Business Journal, February 4, 2015, http://www.gallup.com/businessjournal/ 181481/company-wellness-programs-bust.aspx; A. Frakt and A. e. Carroll, “Do Wellness Programs Work? Usually not,” New York Times, September 11, 2014, http://www.nytimes.com/2014/09/12/upshot/do-workplace-wellness- programs-work-usually-not.html.

674 PART 4 The Organization System cHaPter revieW MyManagementLab Go to mymanagementlab.com to complete the problems marked with this icon. QuestiOns FOr revieW 18-5 What are the potential environmental, 18-1 What are the differences between the forces organizational, and personal sources of stress at work and the role of individual and cultural differences? for change and planned change? 18-6 What are the physiological, psychological, 18-2 How can resistance to change be overcome? 18-3 What are the four main approaches to and behavioral symptoms of stress at work? managing organizational change? 18-7 What are the individual and organizational 18-4 How can managers create a culture for approaches to managing stress? change? eXPerientiaL eXercise Mindfulness at Work The concept of mindfulness emphasizes trying to focus how you are inhaling and exhaling. It is sometimes your mind in the present moment, immersing yourself helpful to count how long each breath takes. Try to in what’s going on around you. Core principles include maintain this mindful breathing for 3 minutes. The suspending immediate judgment of the environment group will then take 3 minutes to discuss how this and your own thoughts, and keeping yourself open to made them feel. what is around you. The benefits of mindfulness can • Mindful listening: Now clear your head of everything reach beyond reducing stress to include increased cre- except what is going on in the immediate environ- ativity, longer spans of attention, reductions in procras- ment. Try to hear as many sounds around you as you tination, and improved performance. can, without judging or evaluating them. Try to main- tain this mindful listening for 3 minutes. The group The Procedure will then take 3 minutes to discuss some of the things Start this exercise individually, and then come together they noticed. into groups of three to four individuals to discuss what • Mindful thinking: As with listening, clear your head you have found. Although full workplace mindfulness of everything, but now focus just on your ideas about interventions can take several weeks, some basic start- mindfulness and stress. Do not talk about or write ing exercises can be done in a relatively short period down what you’re thinking (yet); just focus your of time and give you a feeling for what a full course whole quiet attention on this exercise and what it of mindfulness would be like. Here are three simple means. Try to maintain this mindful thinking for 3 exercises to try. For all these, everyone needs to put minutes. The group will then take 3 minutes to talk everything away (especially phones, tablets, and com- about what this experience was like. puters!) and focus on what is going on in the immedi- ate environment. As noted earlier, this is just a brief example of what mindfulness exercises are like. In a full mindfulness pro- • Mindful breathing: Clear your head of everything gram, you would go through several sessions of up to an except thoughts of your own breaths. Concentrate on

Organizational Change and Stress Management CHAPTER 18 675 hour each. Now that you have an idea of what it feels like 18-9. What concerns might you have about implement- to do mindfulness work, consider the following questions ing a mindfulness intervention in the workplace? in your groups: What are some of the obstacles you might face in trying to have employees engage in a mindfulness 18-8. Were there any aspects of the mindfulness practice stress reduction program? sessions that you found especially pleasant or use- ful? Were there any aspects of the sessions that you 18-10. Bring the class together and discuss your found unpleasant or uncomfortable? responses. Sources: E. Langer, “Mindfulness in the Age of Complexity,” Harvard Business Review, March 2014, 68–73; H. J. E. M. Alberts and U. R. Hülsheger, “Applying Mindfulness in the Context of Work: Mind- fulness-Based Interventions,” in J. Reb and P. W. B. Atkins, Mindfulness in Organizations (Cambridge, UK: Cambridge University Press, 2015), 17–41; K. A. Aikens, J. Astin, K. R. Pelletier, K. Levanovich, C. M. Baase, Y. Y. Park, and C. M. Bodnar, “Mindfulness Goes to Work: Impact of an Online Work- place Intervention,” Journal of Occupational and Environmental Medicine 56 (2014): 721–31. etHicaL DiLeMMa All Present and Accounted For Diya looked at the records of Jose’s workstation logins, employees with greater access to sick-leave benefits. Pressure and she wasn’t pleased. Day after day, week after week, to come to work when sick is obviously a significant source of the record showed that Jose had consistently been at his stress. And stress weakens the immune response. This means computer, writing code and compiling data on user expe- a culture of presenteeism will eventually lead to long-term ill- riences. In the tech industry, long hours without a break ness. It therefore seems Diya’s concerns for Jose’s long-term are expected, but Diya knew that her friend Jose was push- health are well-founded. When sick employees come into ing himself past the point of exhaustion. He had been suf- work, it also increases the odds that others will be infected. fering for weeks from an unidentified upper respiratory Over time, this can result in systemic work delays. ailment, and she worried that without rest he’d never get better. But pressure for rapid progress from their supervi- A large, stable organization like Microsoft may have sor left Jose feeling like he had little choice but to keep a comparatively easy time seeing the big-picture positive grinding out the long hours, sick or not. consequences of discouraging presenteeism. In a small firm that has short-term contracts with larger organiza- The problem of absenteeism, not showing up for work tions, like the one Jose and Diya work for, it can be very when expected, is a classic struggle for managers. Recent at- tempting to push employees to come into work no matter tention has suggested, however, that absenteeism has an op- what. A few days off the job could mean the loss of a sig- posite with its own negative consequences—presenteeism. nificant business opportunity. And so employees give in to Presenteeism occurs when an employee continues to go to pressure and struggle through their work days, as long as work despite illness. Unlike absenteeism, presenteeism may they can. arise specifically because management is pushing for it. Questions An employee can engage in presenteeism for a variety 18-11. How might presenteeism be an adaptive response of reasons, but as the story of Jose describes, sometimes it’s a response to work pressure. Companies that put exten- to perceived performance pressure? How is it a sive resources into monitoring employee attendance also response to work demand pressures? tend to experience higher levels of presenteeism. In other 18-12. Do employers have an ethical responsibility to words, empirical evidence suggests companies are sending discourage presenteeism? Why or why not? signals to employees that attendance is required—even 18-13. How might a company work to change employee when they are too ill to work. attitudes and behaviors about presenteeism? In other words, what would an effective presenteeism Some companies have started to buck the trend. prevention program look like? Microsoft, for example, has pushed its contractors to provide Sources: D. Engber, “Quit Whining about Your Sick Colleague,” New York Times, December 29, 2014, http://www.nytimes.com/2014/12/30/opinion/quit-whining-about-your-sick-colleague.html; C. C. Miller, “From Microsoft, a Novel Way to Mandate Sick Leave,” New York Times, March 26, 2015, http://www.nytimes.com/2015/03/26/upshot/26up-leave.html?abt=0002&abg=0; and S. Deery, J. Walsh, and C. D. Zatzick, “A Moderated Mediation Analysis of Job Demands, Presenteeism, and Absenteeism,” Journal of Occupational and Organizational Psychology, June 2014, 352–69.

676 PART 4 The Organization System case inciDent 1 Atos: Zero Email Program The technology that gave us the smart phone, tablet, has been reduced by 60 percent. In addition, Atos has and laptop has enabled employees to access their work introduced a certification process that has resulted in the from anywhere in the world. Communication has been redesign of 220 business processes to become email-free. enhanced by the use of texts, calls, instant messages, email, and social networking sites. The burden of being Greater digital connectivity goes hand-in-hand with an anytime–anywhere worker is having a negative impact greater worker responsibility. According to Randstad’s on the health of employees, family life, and productivity. Workmonitor Global Report in 2015, 57 percent of employ- Employees are experiencing unmanageable workloads, ees surveyed stated that their employer expects them to be the loss of face-to-face relationships with colleagues, and available outside regular office hours. The results revealed the overuse of emails in managing difficult work-related that 89 percent of Chinese workers believed that they issues. However, the future of work is changing from a should be available outside of working times in contrast to directive approach towards collaborative frameworks that 40 percent of employees in Sweden. Globally, 47 percent of cause employees to think and act differently. the respondents said that their employer expects them to be available by phone and email during holidays. In 2011, Thierry Breton, Chairman and CEO of tech- nology giant ATOS, launched a Zero Email program. The Rather than getting rid of emails or texting, we must organization focuses on business technology and helps put them to better use. Organizations need to advise em- organizations to develop into firms of the future. Atos ployees on the acceptable times to email, how to avoid recognized that email is a barrier to collaborative transfor- overload of information, the overuse of email and the mation. Breton’s initiative was launched to completely elim- benefits of face-to-face communication. They must also inate the use of email for internal communications and to address the need for work–life balance. Recently, the use enterprise social initiatives instead. Eliminating email French trade union that represents employees in the is a key pillar of the organization’s internal wellbeing at technology and consultancy sectors, which includes divi- work initiative, which is designed to enhance working con- sions of Google, Facebook, and Deloitte, agreed to allow ditions. The aim was to move towards a social, collaborative staff to shut off their phones and computers after 6 pm. enterprise that shares knowledge and finds experts easily to It was agreed that organizations cannot pressure their respond to the needs of clients quickly and efficiently, de- employees or make them feel bad about not checking or livering tangible business results. The culture evolved from responding to their email. one based on hierarchies and command-and-control to a more open environment. Leaders and employees can now As employees across the world see their work days engage with each other quickly and easily. This challenged grow longer and the boundaries between their personal established ways of working and the tools that were used, and work lives getting increasingly blurred, firms—like and introduced new technologies and behaviours. Atos—must address this challenge by implementing a cultural change supported by the adaptation of employee The focus of the Zero Email initiative was to reduce the behavior and management styles. overall messaging load on the 76,000 business technolo- gists who work for Atos in 52 countries. Emails that were Questions previously used to assign employees to tasks have been 18-14. Consider the sources of stress in modern organiza- replaced by discussions in online communities where employees communicate, share best practices, and de- tions such as Atos. Identify individual differences velop new ideas. Collaborative operations have resulted that can moderate the effect of stress. in more efficient teamwork: 25 percent of work time pre- 18-15. Describe the symptoms of stress that may be expe- viously devoted to email activities is now spent on busi- rienced by employees. ness activities. Internal email disruption and overload 18-16. Recommend two further strategies that could be introduced in Atos to help employees manage the demands of the “always on” working environment. Sources: “Collaboration and Social Media,” Atos Official Website, http://atos.net/en-us/home/we- are/zero-email.html#; C. Cooper, “Work Email Is Making Us a ‘Generation of Idiots’. Time to Switch Off,” The Guardian, May 14, 2015, http://www.theguardian.com/commentisfree/2015/may/14/ work-email-benefits-technology-human-interaction; Global Report Randstad Workmonitor, “Work- ing Hours vs. Private Time: Blurred Lines Incl. Quarterly Mobility, Job Change and Job Satisfaction,” Wave 2 2015, Group Communications Randstad Holding nv.; A. Kjerulf, “5 Awesome Corporate Email Policies,” November 20, 2014, http://positivesharing.com/2014/11/5-awesome-corporate- email-policies/.

Organizational Change and Stress Management CHAPTER 18 677 case inciDent 2 When Companies Fail to Change The Triniton TV, transistor radio, Walkman, and VCR firms make a larger number of products than most of are the stuff of time capsules nowadays, but not long ago their global competitors. Former Sony executive Yoshia- they were cutting-edge technology. Japan was at the pin- ki Sakito said, “Sony makes too many models, and for nacle of the home consumer electronics industry from none of them can they say, ‘This contains our best, most the 1970s to the 1990s, introducing new innovations to cutting-edge technology.’ Apple, on the other hand, the world each year. Now those same Japanese firms are makes one amazing phone in just two colors and says, at the back of the pack and struggling to stay in the game. ‘This is the one.’” Japanese electronics production has fallen by more than 41 percent, and Japan’s global market share of electronics For Japanese electronics companies to survive, they goods and services has decreased by more than half since must change. They were once able to structure their or- 2000. Sony, for example, hasn’t earned a profit since 2008. ganizations around abundant, inexpensive labor to keep What happened? costs down and prices competitive, but that’s no longer the case. One complicating factor is that Japan is an ancient The simple answer is failure to innovate. While firms country of many traditions, with a low birth rate and an outside Japan pioneered digital technology and con- aging population, so there will be an increasing shortage quered the Internet, Japanese firms stuck to semicon- of workers. The country’s culture will make it even more ductors and hardware. But the deeper issue is the refusal difficult to realign to globalization. It now must change to of Japanese managers to adapt to the global environ- foster innovation, which may involve a cultural as much as ment and change their organizations accordingly. For an organizational transformation. instance, Sony mastered the technology needed for a digital music player years before Apple introduced the Questions iPod in 2001, but its engineers resisted the change. So- 18-17. What made the Japanese electronics industry ini- ny’s divisions would not cooperate with one another fast enough to compete in this market or in the new market tially successful? for flat-screen TVs. Even now, Sony has not managed to 18-18. How does a corporation such as Sony fundamen- change its organization to reflect current global think- ing in the industry. For instance, it and other Japanese tally differ from one like Apple? 18-19. Where might Japanese organizations outsource pro- duction to remain competitive in today’s markets? Sources: H. Hiyama, “Sony Break-Up Call Shines Light on Electronics Industry Problems,” Japan Today, June 7, 2013, www.japantoday.com/category/opinions/view/sony-break-up-call-shines-light- on-electronic-industry-problems; R. Katz, “How Japan Blew Its Lead in Electronics,” The Wall Street Journal, March 23, 2012, A15; and H. Tabuchi, “How the Parade Passed Sony By,” The New York Times, April 15, 2012, B1, B7. MyManagementLab Go to mymanagementlab.com for the following Assisted-graded writing questions: 18-20. In considering Case Incident 1, have you ever felt pressured to work when you were ill? How did you respond? How might you respond now? 18-21. In regard to Case Incident 2, only 13 of the top 21 U.S. electronics manufacturers today were in existence in 1970 (and six were smaller than Fortune 500 firms), while there have been no new top Japanese electron- ics manufacturers for more than 50 years. How do you think age issues affect the ability of Japanese firms to bring about the changes they need to be competitive? 18-22. MyManagementLab Only – comprehensive writing assignment for this chapter.

678 PART 4 The Organization System enDnOtes Investigation of Contextual and Personal 26See, for instance, J. Manchester, D. L. Influences on Employees’ Commitment to Gray-Miceli, J. A. Metcalf, C. A. Paolini, A. 1 A. Chowdhry, “Apple Surpassed Samsung as Change,” Journal of Applied Psychology 92, no. H. Napier, C. L. Coogle, and M. G. Owens, Global Phone Market Leader, Says Report,” 4 (2007): 942–51; and G. B. Cunningham, “Facilitating Lewin’s Change Model with Col- Forbes, March 3, 2015, http://www.forbes “The Relationships among Commitment to laborative Evaluation in Promoting Evidence .com/sites/amitchowdhry/2015/03/04/ Change, Coping with Change, and Turnover Based Practices of Health Professionals,” apple-passes-samsung/. Intentions,” European Journal of Work and Orga- Evaluation and Program Planning, December 2See, for instance, J. Birkinshaw, G. Hamel, nizational Psychology 15, no. 1 (2006): 29–45. 2014, 82–90. and M. J. Mol, “Management Innovation,” 15R. Peccei, A. 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Organizational Change and Stress Management CHAPTER 18 681 104Y.-F. Chen, “Job Stress and Performance: 109K. M. Richardson and H. R. Rothstein, 114E. R. Greenglass and L. Fiksenbaum, A Study of Police Officers in Central Taiwan,” “Effects of Occupational Stress Management “Proactive Coping, Positive Affect, and Social Behavior and Personality 37, no. 10 (2009): Intervention Programs: A Meta-Analysis,” Well-Being: Testing for Mediation Using 1341–66; and L. A. Muse, S. G. Harris, and Journal of Occupational Health Psychology 13, no. Path Analysis,” European Psychologist 14, no. H. S. Field, “Has the Inverted-U Theory of 1 (2008): 69–93. 1 (2009): 29–39; and P. Miquelon and R. J. Stress and Job Performance Had a Fair Test?” 110R. W. Renn, D. G. Allen, and T. M. Huning, Vallerand, “Goal Motives, Well-Being, and Human Performance 16, no. 4 (2003): 349–64. “Empirical Examination of Individual-Level Physical Health: Happiness and Self-Real- 105See, for example, L. W. Hunter and M. B. Personality-Based Theory of Self-Management ization as Psychological Resources under Thatcher, “Feeling the Heat: Effects of Stress, Failure,” Journal of Organizational Behavior Challenge,” Motivation and Emotion 30, no. 4 Commitment, and Job Experience on Job Per- 32, no. 1 (2011): 25–43; and P. Gröpel and (2006): 259–72. formance,” Academy of Management Journal 50, P. Steel, “A Mega-Trial Investigation of Goal 115M. M. Butts, R. J. Vandenberg, D. M. DeJoy, no. 4 (2007): 953–68; and J. C. Vischer, “The Setting, Interest Enhancement, and Energy B. S. Schaffer, and M. G. Wilson, “Individual Effects of the Physical Environment on Job on Procrastination,” Personality and Individual Reactions to High Involvement Work Pro- Performance: Towards a Theoretical Model of Differences 45, no. 5 (2008): 406–11. cesses: Investigating the Role of Empower- Workplace Stress,” Stress and Health 23, no. 3 111S. Klaperski, B. von Dawans, M. Heinrichs, ment and Perceived Organizational Support,” (2007): 175–84. and R. Fuchs, “Does the Level of Physical Ex- Journal of Occupational Health Psychology 14, no. 106Y.-C. Wu, “Job Stress and Job Performance ercise Affect Physiological and Psychological 2 (2009): 122–36. among Employees on the Taiwanese Finance Responses to Psychosocial Stress in Women?” 116“100 Best Companies to Work For,” Fortune, Sector: The Role of Emotional Intelligence,” Psychology of Sport and Exercise 14, no. 2 (2013): August 17, 2011, http://money.cnn.com/ Social Behavior and Personality 39, no. 1 266–74. magazines/fortune. (2011): 21–31. This study was replicated with 112K. M. Richardson and H. R. Rothstein, 117L. Blue, “Making Good Health Easy,” Time, similar results in U. Yozgat, S. Yurtkoru, and “Effects of Occupational Stress Management November 12, 2009, www.time.com; and E. Bilginoglu, “Job Stress and Job Perfor- Intervention Programs: A Meta-Analysis,” M. Andrews, “America’s Best Health Plans,” US mance among Employees in Public Sector Journal of Occupational Health Psychology 13, no. News and World Report, November 5, 2007, 54–60. in Istanbul: Examining the Moderating Role 1 (2008): 69–93. 118K. M. Richardson and H. R. Rothstein, of Emotional Intelligence,” in E. Eren (ed.), 113V. C. Hahn, C. Binnewies, S. Sonnentag, “Effects of Occupational Stress Management Procedia Social and Behavioral Sciences vol. 75 and E. J. Mojza, “Learning How to Recover Intervention Programs: A Meta-Analysis,” (2013): 518–24. from Job Stress: Effects of a Recovery Train- Journal of Occupational Health Psychology 13, no. 107S. Gilboa, A. Shirom, Y. Fried, and C. L. ing Program on Recovery, Recovery-Related 1 (2008): 69–93. Cooper, “A Meta-Analysis of Work Demand Self-Efficacy, and Well-Being,” Journal of Oc- 119L. L. Berry, A. M. Mirabito, and W. B. Baun, Stressors and Job Performance: Examining cupational Health Psychology 16, no. 2 (2011): “What’s the Hard Return on Employee Wellness Main and Moderating Effects,” Personnel 202–16; and C. Binnewies, S. Sonnentag, and Programs?” Harvard Business Review, December Psychology 61, no. 2 (2008): 227–71. E. J. Mojza, “Recovery during the Weekend 2010, https://hbr.org/2010/12/whats-the-hard- 108J. C. Wallace, B. D. Edwards, T. Arnold, and Fluctuations in Weekly Job Performance: return-on-employee-wellness-programs. M. L. Frazier, and D. M. Finch, “Work Stressors, A Week-Level Study Examining Intra-Indi- 120S. Mattke, L. Hangsheng, J. P. Caloyeras, Role-Based Performance, and the Moderating vidual Relationships,” Journal of Occupational C. Y. Huan, K. R. Van Busum, D. Khodyakov, Influence of Organizational Support,” Journal and Organizational Psychology 83, no. 2 (2010): and V. Shier, Workplace Wellness Programs Study of Applied Psychology 94, no. 1 (2009): 254–62. 419–41. (Santa Monica, CA: RAND, 2013).

Appendix Research in Organizational Behavior A number of years ago, a friend of mine was excited of the findings. But some studies are poorly designed, because he had read about the findings from a research making their conclusions at best suspect, and at worst study that finally, once and for all, resolved the question meaningless. of what it takes to make it to the top in a large corpora- tion. I doubted there was any simple answer to this ques- Rather than attempting to make you a researcher, tion but, not wanting to dampen his enthusiasm, I asked the purpose of this appendix is to increase your aware- him to tell me of what he had read. The answer, accord- ness as a consumer of behavioral research. A knowledge ing to my friend, was participation in college athletics. To of research methods will allow you to appreciate more say I was skeptical of his claim is a gross understatement, fully the care in data collection that underlies the infor- so I asked him to tell me more. mation and conclusions presented in this text. More- over, an understanding of research methods will make The study encompassed 1,700 successful senior you a more skilled evaluator of the OB studies you will executives at the 500 largest U.S. corporations. The encounter in business and professional journals. So researchers found that half of these executives had an appreciation of behavioral research is important played varsity-level college sports.1 My friend, who hap- because (1) it’s the foundation on which the theories pens to be good with statistics, informed me that since in this text are built, and (2) it will benefit you in future fewer than 2 percent of all college students partici- years when you read reports of research and attempt to pate in intercollegiate athletics, the probability of this assess their value. finding occurring by mere chance is less than 1 in 10 million! He concluded his analysis by telling me that, Purposes of Research based on this research, I should encourage my manage- ment students to get into shape and to make one of the Research is concerned with the systematic gathering of varsity teams. information. Its purpose is to help us in our search for the truth. Although we will never find ultimate truth— My friend was somewhat perturbed when I sug- in our case, that would be to know precisely how any gested that his conclusions were likely to be flawed. person or group would behave in any organizational These executives were all males who attended college context—ongoing research adds to our body of OB in the 1940s and 1950s. Would his advice be meaningful knowledge by supporting some theories, contradicting to females in the twenty-first century? These executives others, and suggesting new theories to replace those also weren’t your typical college students. For the most that fail to gain support. part, they had attended elite private colleges such as Princeton and Amherst, where a large proportion of the Research Terminology student body participates in intercollegiate sports. And these “jocks” hadn’t necessarily played football or bas- Researchers have their own vocabulary for communicat- ketball; many had participated in golf, tennis, baseball, ing among themselves and with outsiders. The following cross-country running, crew, rugby, and similar minor briefly defines some of the more popular terms you’re sports. Moreover, maybe the researchers had confused likely to encounter in behavioral science studies.2 the direction of causality. That is, maybe individuals with the motivation and ability to make it to the top of Variable a large corporation are drawn to competitive activities like college athletics. A variable is any general characteristic that can be mea- sured and that changes in amplitude, intensity, or both. My friend was guilty of misusing research data. Of Some examples of OB variables found in this textbook course, he is not alone. We are all continually bombarded are job satisfaction, employee productivity, work stress, with reports of experiments that link certain substances ability, personality, and group norms. to cancer in mice and surveys that show changing atti- tudes toward sex among college students, for example. Many of these studies are carefully designed, with great caution taken to note the implications and limitations 682

Appendix Research in Organizational Behavior 683 Hypothesis of cause and effect is called causality. Changes in the independent variable are assumed to cause changes A tentative explanation of the relationship between two in the dependent variable. However, in behavioral re- or more variables is called a hypothesis. My friend’s state- search, it’s possible to make an incorrect assumption of ment that participation in college athletics leads to a top causality when relationships are found. For example, executive position in a large corporation is an example early behavioral scientists found a relationship between of a hypothesis. Until confirmed by empirical research, employee satisfaction and productivity. They concluded a hypothesis remains only a tentative explanation. that a happy worker was a productive worker. Follow- up research has supported the relationship, but discon- Dependent Variable firmed the direction of the arrow. The evidence more correctly suggests that high productivity leads to satis- A dependent variable is a response that is affected by faction rather than the other way around. an independent variable. In terms of the hypothesis, it is the variable that the researcher is interested in Correlation Coefficient explaining. Referring back to our opening example, the dependent variable in my friend’s hypothesis It’s one thing to know that there is a relationship be- was executive succession. In organizational behavior tween two or more variables. It’s another to know the research, the most popular dependent variables are strength of that relationship. The term correlation coeffi- productivity, absenteeism, turnover, job satisfaction, cient is used to indicate that strength, and is expressed and organizational commitment.3 as a number between −1.00 (a perfect negative relation- ship) and +1.00 (a perfect positive correlation). Independent Variable When two variables vary directly with one another, An independent variable is the presumed cause of some the correlation will be expressed as a positive number. change in the dependent variable. Participating in varsi- When they vary inversely—that is, one increases as the ty athletics was the independent variable in my friend’s other decreases—the correlation will be expressed as hypothesis. Popular independent variables studied by a negative number. If the two variables vary indepen- OB researchers include intelligence, personality, job dently of each other, we say that the correlation between satisfaction, experience, motivation, reinforcement them is zero. patterns, leadership style, reward allocations, selection methods, and organization design. For example, a researcher might survey a group of employees to determine the satisfaction of each with his You may have noticed we said that job satisfaction or her job. Then, using company absenteeism reports, is frequently used by OB researchers as both a depen- the researcher could correlate the job satisfaction dent and an independent variable. This is not an error. scores against individual attendance records to deter- It merely reflects that the label given to a variable mine whether employees who are more satisfied with depends on its place in the hypothesis. In the statement their jobs have better attendance records than their “Increases in job satisfaction lead to reduced turnover,” counterparts who indicated lower job satisfaction. Let’s job satisfaction is an independent variable. However, suppose the researcher found a correlation coefficient in the statement “Increases in money lead to higher of +0.50 between satisfaction and attendance. Would job satisfaction,” job satisfaction becomes a dependent that be a strong association? There is, unfortunately, no variable. precise numerical cutoff separating strong and weak relationships. A standard statistical test would need to Moderating Variable be applied to determine whether the relationship was a significant one. A moderating variable abates the effect of the indepen- dent variable on the dependent variable. It might also A final point needs to be made before we move on: be thought of as the contingency variable: If X (indepen- A correlation coefficient measures only the strength of dent variable), then Y (dependent variable) will occur, association between two variables. A high value does not but only under conditions Z (moderating variable). To imply causality. The length of women’s skirts and stock translate this into a real-life example, we might say that market prices, for instance, have long been noted to be if we increase the amount of direct supervision in the highly correlated, but one should be careful not to infer work area (X ), then there will be a change in worker that a causal relationship between the two exists. In this productivity (Y ), but this effect will be moderated by instance, the high correlation is more happenstance the complexity of the tasks being performed (Z ). than predictive. Causality Theory A hypothesis, by definition, implies a relationship. That The final term we introduce in this section is theory. The- is, it implies a presumed cause and effect. This direction ory describes a set of systematically interrelated concepts

684 Appendix Research in Organizational Behavior or hypotheses that purports to explain and predict phe- such studies generalizable to full-time employees in real nomena. In OB, theories are also frequently referred to jobs? Similarly, how generalizable to the overall work as models. We use the two terms interchangeably. population are the results from a study that assesses job stress among 10 nuclear power plant engineers in the There are no shortages of theories in OB. For hamlet of Mahone Bay, Nova Scotia? instance, we have theories to describe what motivates people, the most effective leadership styles, the best Research Design way to resolve conflicts, and how people acquire power. In some cases, we have half a dozen or more separate Doing research is an exercise in trade-offs. Richness theories that purport to explain and predict a given of information typically comes with reduced generaliz- phenomenon. In such cases, is one right and the oth- ability. The more a researcher seeks to control for con- ers wrong? No! They tend to reflect science at work— founding variables, the less realistic his or her results researchers testing previous theories, modifying them, are likely to be. High precision, generalizability, and and, when appropriate, proposing new models that may control almost always translate into higher costs. When prove to have higher explanatory and predictive pow- researchers make choices about whom they’ll study, ers. Multiple theories attempting to explain common where their research will be done, the methods they’ll phenomena merely attest that OB is an active discipline, use to collect data, and so on, they must make some still growing and evolving. concessions. Good research designs are not perfect, but they do carefully reflect the questions being addressed. Evaluating Research Keep these facts in mind as we review the strengths and weaknesses of five popular research designs: case stud- As a potential consumer of behavioral research, you ies, field surveys, laboratory experiments, field experi- should follow the dictum of caveat emptor—let the buyer ments, and aggregate quantitative reviews. beware! In evaluating any research study, you need to ask three questions.4 Case Study Is it valid? Is the study actually measuring what it You pick up a copy of Soichiro Honda’s autobiography. claims to be measuring? A number of psychological In it he describes his impoverished childhood; his de- tests have been discarded by employers in recent years cisions to open a small garage, assemble motorcycles, because they have not been found to be valid measures and eventually build automobiles; and how this led to of the applicants’ ability to do a given job successfully. the creation of one of the largest and most successful But the validity issue is relevant to all research studies. corporations in the world. Or you’re in a business class So, if you find a study that links cohesive work teams and the instructor distributes a 50-page handout cover- with higher productivity, you want to know how each of ing two companies: Walmart and Kmart. The handout these variables was measured and whether it is actually details the two firms’ histories; describes their corporate measuring what it is supposed to be measuring. strategies, management philosophies, and merchandis- ing plans; and includes copies of their recent balance Is it reliable? Reliability refers to consistency of mea- sheets and income statements. The instructor asks the surement. If you were to have your height measured class members to read the handout, analyze the data, every day with a wooden yardstick, you’d get highly and determine why Walmart has been so much more reliable results. On the other hand, if you were mea- successful than Kmart in recent years. sured each day by an elastic tape measure, there would probably be considerable disparity between your height Soichiro Honda’s autobiography and the Walmart measurements from one day to the next. Your height, of and Kmart handouts are case studies. Drawn from real- course, doesn’t change from day to day. The variability life situations, case studies present an in-depth analysis is due to the unreliability of the measuring device. So if of one setting. They are thorough descriptions, rich in a company asked a group of its employees to complete a details about an individual, a group, or an organization. reliable job satisfaction questionnaire, and then repeat The primary source of information in case studies is the questionnaire six months later, we’d expect the obtained through observation, occasionally backed up results to be very similar—provided nothing changed by interviews and a review of records and documents. in the interim that might significantly affect employee satisfaction. Case studies have their drawbacks. They’re open to  the perceptual bias and subjective interpretations Is it generalizable? Are the results of the research study of  the observer. The reader of a case is captive to generalizable to groups of individuals other than those what the observer/case writer chooses to include and who participated in the original study? Be aware, for exclude. Cases also trade off generalizability for depth example, of the limitations that might exist in research that uses college students as subjects. Are the findings in

Appendix Research in Organizational Behavior 685 of information and richness of detail. Because it’s the format is better at tapping respondents’ attitudes always dangerous to generalize from a sample of one, and perceptions than behaviors. Third, responses can case studies make it difficult to prove or reject a hypoth- suffer from social desirability; that is, people saying what esis. On the other hand, you can’t ignore the in-depth they think the researcher wants to hear. Fourth, since analysis that cases often provide. They are an excellent field surveys are designed to focus on specific issues, device for initial exploratory research and for evaluat- they’re a relatively poor means of acquiring depth of ing real-life problems in organizations. information. Finally, the quality of the generalizations is largely a factor of the population chosen. Responses Field Survey from executives at Fortune 500 firms, for instance, tell us nothing about small- or medium-sized firms or A lengthy questionnaire was created to assess the use not-for-profit organizations. In summary, even a well- of ethics policies, formal ethics structures, formalized designed field survey trades off depth of information activities such as ethics training, and executive involve- for breadth, generalizability, and economic efficiencies. ment in ethics programs among billion-dollar corpora- tions. The public affairs or corporate communications Laboratory Experiment office of all Fortune 500 industrial firms and 500 service corporations were contacted to get the name and ad- The following study is a classic example of the laboratory dress of the “officer most responsible for dealing with experiment. A researcher, Stanley Milgram, wondered ethics and conduct issues” in each firm. The question- how far individuals would go in following commands. If naire, with a cover letter explaining the nature of the subjects were placed in the role of a teacher in a learn- study, was mailed to these 1,000 officers. Of the total, ing experiment and told by an experimenter to admin- 254 returned a completed questionnaire, for a response ister a shock to a learner each time that learner made rate just above 25 percent. The results of the survey a mistake, would the subjects follow the commands of found, among other things, that 77 percent had formal the experimenter? Would their willingness to comply codes of ethics and 54 percent had a single officer spe- decrease as the intensity of the shock was increased? cifically assigned to deal with ethics and conduct issues.5 To test these hypotheses, Milgram hired a set of The preceding study illustrates a typical field survey. subjects. Each was led to believe that the experiment A sample of respondents (in this case, 1,000 corporate was to investigate the effect of punishment on mem- officers in the largest U.S. publicly held corporations) ory. Their job was to act as teachers and administer was selected to represent a larger group that was under punishment whenever the learner made a mistake on examination (billion-dollar U.S. business firms). The the learning test. respondents were then surveyed using a questionnaire or interviewed to collect data on particular character- Punishment was administered by an electric shock. istics (the content and structure of ethics programs The subject sat in front of a shock generator with 30 and practices) of interest to the researchers. The stan- levels of shock—beginning at zero and progressing in dardization of response items allows for data to be eas- 15-volt increments to a high of 450 volts. The demarca- ily quantified, analyzed, and summarized, and for the tions of these positions ranged from “Slight Shock” at 15 researchers to make inferences from the representative volts to “Danger: Severe Shock” at 450 volts. To increase sample about the larger population. the realism of the experiment, the subjects received a sample shock of 45 volts and saw the learner—a pleas- The field survey provides economies for doing ant, mild-mannered man about 50 years old—strapped research. It’s less costly to sample a population than into an “electric chair” in an adjacent room. Of course, to obtain data from every member of that population. the learner was an actor, and the electric shocks were (There are, for instance, more than 5,000 U.S. busi- phony, but the subjects didn’t know this. ness firms with sales in excess of a billion dollars; and since some of these are privately held and don’t release Taking his seat in front of the shock generator, the financial data to the public, they are excluded from the subject was directed to begin at the lowest shock level Fortune list). Moreover, as the ethics study illustrates, and to increase the shock intensity to the next level each field surveys provide an efficient way to find out how time the learner made a mistake or failed to respond. people feel about issues or how they say they behave. These data can then be easily quantified. When the test began, the shock intensity rose rapidly because the learner made many errors. The subject got But the field survey has a number of potential verbal feedback from the learner: At 75 volts, the learner weaknesses. First, mailed questionnaires rarely obtain began to grunt and moan; at 150 volts, he demanded to 100  percent returns. Low response rates call into be released from the experiment; at 180 volts, he cried question whether conclusions based on respondents’ out that he could no longer stand the pain; and at 300 answers are generalizable to nonrespondents. Second, volts, he insisted that he be let out, yelled about his heart condition, screamed, and then failed to respond to further questions.

686 Appendix Research in Organizational Behavior Most subjects protested and, fearful they might kill became the control group, no changes were made in the learner if the increased shocks were to bring on a the employees’ 5-day week. Absence data were gath- heart attack, insisted they could not go on with their ered from the company’s records at both locations for job. Hesitations or protests by the subject were met by a period of 18 months. This extended time period less- the experimenter’s statement, “You have no choice, you ened the possibility that any results would be distorted must go on! Your job is to punish the learner’s mistakes.” by the mere novelty of changes being implemented in Of course, the subjects did have a choice. All they had the experimental plant. After 18 months, management to do was stand up and walk out. found that absenteeism had dropped by 40 percent at the experimental plant, and by only 6 percent in the The majority of the subjects dissented. But dissen- control plant. Because of the design of this study, man- sion isn’t synonymous with disobedience. Sixty-two agement believed that the larger drop in absences at percent of the subjects increased the shock level to the experimental plant was due to the introduction of the maximum of 450 volts. The average level of shock the compressed workweek. administered by the remaining 38 percent was nearly 370 volts.6 The field experiment is similar to the laboratory experiment except it is conducted in a real organi- In a laboratory experiment such as that conducted zation. The natural setting is more realistic than the by Milgram, an artificial environment is created by the laboratory setting, and this enhances validity but researcher. Then the researcher manipulates an inde- hinders control. In addition, unless control groups pendent variable under controlled conditions. Finally, are maintained, there can be a loss of control if extra- since all other things are held equal, the researcher is neous forces intervene—for example, an employee able to conclude that any change in the dependent vari- strike, a major layoff, or a corporate restructuring. able is due to the manipulation or change imposed on Maybe the greatest concern with field studies has to the independent variable. Note that, because of the con- do with organizational selection bias. Not all organiza- trolled conditions, the researcher is able to imply causa- tions are going to allow outside researchers to come tion between the independent and dependent variables. in and study their employees and operations. This is especially true of organizations that have serious The laboratory experiment trades off realism and problems. Therefore, since most published studies generalizability for precision and control. It provides a in OB are done by outside researchers, the selection high degree of control over variables and precise mea- bias might work toward the publication of studies surement of those variables. But findings from labora- conducted almost exclusively at successful and well- tory studies are often difficult to generalize to the real managed organizations. world of work. This is because the artificial laboratory rarely duplicates the intricacies and nuances of real Our general conclusion is that, of the four research organizations. In addition, many laboratory experi- designs we’ve discussed to this point, the field experi- ments deal with phenomena that cannot be reproduced ment typically provides the most valid and generalizable or applied to real-life situations. findings and, except for its high cost, trades off the least to get the most.7 Field Experiment Aggregate Quantitative Reviews The following is an example of a field experiment. The management of a large company is interested in deter- What’s the overall effect of organizational behavior mining the impact that a 4-day workweek would have on modification (OB Mod) on task performance? There employee absenteeism. To be more specific, manage- have been a number of field experiments that have ment wants to know if employees working four 10-hour sought to throw light on this question. Unfortunately, days have lower absence rates than similar employees the wide range of effects from these various studies working the traditional 5 day week of 8 hours each day. makes it hard to generalize. Because the company is large, it has a number of man- ufacturing plants that employ essentially similar work- To try to reconcile these diverse findings, two forces. Two of these are chosen for the experiment, researchers reviewed all the empirical studies they could both located in the greater Cleveland area. Obviously, it find on the impact of OB Mod on task performance would not be appropriate to compare two similar-sized over a 20-year period.8 After discarding reports that had plants if one is in rural Mississippi and the other is in inadequate information, had nonquantitative data, or urban Copenhagen because factors such as national didn’t meet all conditions associated with principles of culture, transportation, and weather might be more behavioral modification, the researchers narrowed their likely to explain any differences found than changes in set to 19 studies that included data on 2,818 individuals. the number of days worked per week. Using an aggregating technique called meta-analysis, the researchers were able to synthesize the studies quanti- In one plant, the experiment was put into place— tatively and to conclude that the average person’s task workers began the 4-day week. At the other plant, which

Appendix Research in Organizational Behavior 687 performance will rise from the 50th percentile to the Health, I want you to understand what I went through 67th percentile after an OB Mod intervention. in anticipation that you will respond accordingly. I await your response.” The fictitious letter was part of the pro- The OB Mod–task performance review done by these fessor’s study to determine how restaurants responded researchers illustrates the use of meta-analysis, a quanti- to complaints. But it created culinary chaos among tative form of literature review that enables researchers many of the restaurant owners, managers, and chefs as to look at validity findings from a comprehensive set of they reviewed menus and produce deliveries for possi- individual studies, and then apply a formula to them to bly spoiled food, and questioned kitchen workers about determine if they consistently produced similar results.9 possible lapses. A follow-up letter of apology from the If results prove to be consistent, it allows researchers to university for “an egregious error in judgment by a conclude more confidently that validity is generalizable. junior faculty member” did little to offset the distress it Meta-analysis is a means for overcoming the potentially created for those affected. imprecise interpretations of qualitative reviews and to synthesize variations in quantitative studies. In addition, Professional associations like the American Psycho- the technique enables researchers to identify potential logical Association, the American Sociological Associa- moderating variables between an independent and a tion, and the Academy of Management have published dependent variable. formal guidelines for the conduct of research. Yet the ethical debate continues. On one side are those who In the past 25 years, there’s been a surge in the argue that strict ethical controls can damage the sci- popularity of this research method. Why? It appears entific validity of an experiment and cripple future to offer a more objective means for doing traditional research. Deception, for example, is often necessary to literature reviews. Although the use of meta-analysis avoid contaminating results. Moreover, proponents of requires researchers to make a number of judgment minimizing ethical controls note that few subjects have calls, which can introduce a considerable amount of been appreciably harmed by deceptive experiments. subjectivity into the process, there is no denying that Even in Milgram’s highly manipulative experiment, only meta-analysis reviews have now become widespread in 1.3 percent of the subjects reported negative feelings the OB literature. about their experience. The other side of this debate focuses on the rights of participants. Those favoring Ethics in Research strict ethical controls argue that no procedure should ever be emotionally or physically distressing to subjects, Researchers are not always tactful or candid with sub- and that, as professionals, researchers are obliged to be jects when they do their studies. For instance, questions completely honest with their subjects and to protect the in field surveys may be perceived as embarrassing by subjects’ privacy at all costs. respondents or as an invasion of privacy. Also, research- ers in laboratory studies have been known to deceive Summary participants about the true purpose of their experiment “because they felt deception was necessary to get honest The subject of organizational behavior is composed responses.”10 of a large number of theories that are research based. Research studies, when cumulatively integrated, The “learning experiments” conducted by Stanley become theories, and theories are proposed and fol- Milgram, which were conducted more than 30 years lowed by research studies designed to validate them. ago, have been widely criticized by psychologists on The concepts that make up OB, therefore, are only as ethical grounds. He lied to subjects, telling them his valid as the research that supports them. study was investigating learning, when, in fact, he was concerned with obedience. The shock machine he used The topics and issues in this book are for the most part was a fake. Even the “learner” was an accomplice of Mil- research-derived. They represent the result of systematic gram’s who had been trained to act as if he were hurt information gathering rather than merely hunch, intu- and in pain. Yet ethical lapses continue. For instance, in ition, or opinion. This doesn’t mean, of course, that we 2001, a professor of organizational behavior at Colum- have all the answers to OB issues. Many require far more bia University sent out a common letter on university corroborating evidence. The generalizability of others letterhead to 240 New York City restaurants in which is limited by the research methods used. But new infor- he detailed how he had eaten at this restaurant with his mation is being created and published at an accelerated wife in celebration of their wedding anniversary, how he rate. To keep up with the latest findings, we strongly had gotten food poisoning, and that he had spent the encourage you to regularly review the latest research night in his bathroom throwing up.11 The letter closed in organizational behavior. More academic work can with: “Although it is not my intention to file any reports be found in journals such as the Academy of Management with the Better Business Bureau or the Department of

688 Appendix Research in Organizational Behavior Journal, Academy of Management Review, Administrative “Understanding Behavior in the Milgram Obedience Science Quarterly, Human Relations, Journal of Applied Experiment: The Role of Personality, Situations, and Their Psychology, Journal of Management, Journal of Organizational Interactions,” Journal of Personality and Social Psychology behavior, and Leadership Quarterly. For more practical (March 1991), pp. 398–413. interpretations of OB research findings, you may want 7. See, for example, W. N. Kaghan, A. L. Strauss, S. R. Barley, to read the Academy of Management Executive, California M. Y. Brannen, and R. J. Thomas, “The Practice and Uses of Management Review, Harvard Business Review, Organiza- Field Research in the 21st Century Organization,” Journal of tional Dynamics, and the Sloan Management Review. Management Inquiry (March 1999), pp. 67–81. 8. A. D. Stajkovic and F. Luthans, “A Meta-Analysis of the Endnotes Effects of Organizational Behavior Modification on Task Performance, 1975–1995,” Academy of Management Journal 1. J. A. Byrne, “Executive Sweat,” Forbes (May 20), 1985, (October 1997), pp. 1122–1149. pp. 198–200. 9. See, for example, K. Zakzanis, “The Reliability of Meta Analytic Review,” Psychological Reports (August 1998), 2. See D. P. Schwab, Research Methods for Organizational Behav- pp.  215–222; C. Ostroff and D. A. Harrison, “Meta- ior (Mahwah, NJ: Lawrence Erlbaum Associates, 1999); and Analysis, Level of Analysis, and Best Estimates of Popula- S.  G. Rogelberg (ed.), Blackwell Handbook of Research Meth- tion Correlations: Cautions for Interpreting Meta-Analytic ods in Industrial and Organizational Psychology (Malden, MA: Results in Organizational Behavior,” Journal of Applied Blackwell, 2002). Psychology (April 1999), pp. 260–270; R. Rosenthal and M. R. DiMatteo, “Meta-Analysis: Recent Developments 3. B. M. Staw and G. R. Oldham, “Reconsidering Our Depen- in Quantitative Methods for Literature Reviews,” in S.  T. dent Variables: A Critique and Empirical Study,” Academy of Fiske, D. L. Schacter, and C. Zahn-Wacher (eds.), Annual Management Journal (December 1978), pp. 539–559; and B. M. Review of Psychology, vol. 52 (Palo Alto, CA: Annual Reviews, Staw, “Organizational Behavior: A Review and Reformulation 2001), pp. 59–82; and F.  L. Schmidt and J. E. Hunter, of the Field’s Outcome Variables,” in M. R. Rosenzweig and “Meta-Analysis,” in N. Anderson, D. S. Ones, H. K. Sinang- L. W. Porter (eds.), Annual Review of Psychology, vol. 35 (Palo il, and C.  Viswesvaran (eds.), Handbook of Industrial, Work Alto, CA: Annual Reviews, 1984), pp. 627–666. & Organizational Psychology, vol. 1 (Thousand Oaks, CA: Sage, 2001), pp. 51–70. 4. R. S. Blackburn, “Experimental Design in Organizational 10. For more on ethical issues in research, see T. L. Beau- Settings,” in J. W. Lorsch (ed.), Handbook of Organizational champ, R. R. Faden, R. J. Wallace, Jr., and L. Walters (eds.), Behavior (Upper Saddle River, NJ: Prentice Hall, 1987), Ethical Issues in Social Science Research (Baltimore, MD: Johns pp. 127–128; and F. L. Schmidt, C. Viswesvaran, D. S. Ones, Hopkins University Press, 1982); and J. G. Adair, “Ethics “Reliability Is Not Validity and Validity Is Not Reliability,” of Psychological Research: New Policies, Continuing Issues, Personnel Psychology (Winter 2000), pp. 901–912. New Concerns,” Canadian Psychology (February 2001), pp. 25–37. 5. G. R. Weaver, L. K. Trevino, and P. L. Cochran, “Corporate 11. J. Kifner, “Scholar Sets Off Gastronomic False Alarm,” New Ethics Practices in the Mid-1990’s: An Empirical Study of the York Times (September 8, 2001), p. A1. Fortune 1000,” Journal of Business Ethics (February 1999), pp. 283–294. 6. S. Milgram, Obedience to Authority (New York: Harper & Row, 1974). For a critique of this research, see T. Blass,

Comprehensive Cases 1C a s e Managing Motivation in a Difficult Economy Learning Goals taking a toll on attitudes. The company’s downsizing was big news, and the employees didn’t like what they In this case, you’ll have an opportunity to assess a were hearing. motivational program designed to reenergize a trou- bled company’s workforce. Acting on behalf of the Media reports of Morgan-Moe’s store closings have company’s executive board, you’ll evaluate the board’s focused on the lack of advance notice or communica- current strategy based on survey data. You’ll also advise tion from the company’s corporate offices, as well as the board members about improving the effectiveness of lack of severance payments for departing employees. In this program based on what you’ve learned about goal- the absence of official information, rumors and gossip setting and motivation in organizations. have spread like wildfire among remaining employees. A few angry blogs developed by laid-off employees, like Major Topic Areas IHateMorganMoe.blogspot.com, have made the morale and public relations picture even worse. • Changing nature of work • Diversity and age Morgan-Moe is changing in other ways as well. The • Goal-setting average age of its workforce is increasing rapidly. A cou- • Organizational downsizing ple of factors have contributed to this shift. First, fewer • Organizational justice qualified young people are around because many fami- lies have moved away to find jobs. Second, stores have The Scenario been actively encouraged to hire older workers, such as retirees looking for supplemental income. Manag- Morgan-Moe’s drugstores are in trouble. A major re- ers are very receptive to these older workers because gional player in the retail industry, the company has they are more mature, miss fewer days of work, and do hundreds of stores in the upper Midwest. Unfortunately, not have child care responsibilities. They are also often a sharp decline in the region’s manufacturing economy more qualified than younger workers because they has put management in a serious financial bind. Rev- have more experience, sometimes in the managerial or enues have been consistently dwindling. Customers executive ranks. spend less, and the stores have had to switch their fo- cus to very low-margin commodities, such as milk and These older workers have been a great asset to the generic drugs, rather than the high-margin impulse-buy company in troubled times, but they are especially likely items that used to be the company’s bread and butter. to leave if things get bad. If these older workers start The firm has closed quite a few locations, reversing its to leave the company, taking their hard-earned experi- expansion plans for the first time since it incorporated. ence with them, it seems likely that Morgan-Moe will sink deeper toward bankruptcy. Being that this is uncharted territory for the com- pany, Jim Claussen, vice president for human relations, The System had been struggling with how to address the issue with employees. As the company’s fortunes worsened, he Claussen wasn’t sure how to respond to employees’ could see that employees were becoming more and sense of hopelessness and fear until a friend gave him more disaffected. Their insecurity about their jobs was a book entitled Man’s Search for Meaning. The book was written by a psychologist named Victor Frankl, who survived the concentration camps at Auschwitz. Frankl found that those who had a clear sense of purpose, a 689

690 Comprehensive Cases reason to live, were more likely to persevere in the face Ostremski, another proponent of Program I, added, of nearly unspeakable suffering. Something about this “It’s okay for the employees to feel a little uncertain—if book, and its advocacy of finding meaning and direc- they think we’re in the clear, they’ll slack off. If they tion as a way to triumph over adversity, really stuck with think we’re in trouble, they’ll give up.” Claussen. He thought he might be able to apply its les- sons to his workforce. He proposed the idea of a new Cal Martins also questions the need to provide infor- direction for management to the company’s executive mation to the whole team, but he chose Program II. “A committee, and they reluctantly agreed to try his sug- person should know where he or she stands in the job, gestions. but they don’t have to know about everyone else. It cre- ates unnecessary tension.” Over the last 6 months, stores throughout the com- pany have used a performance management system This is somewhat similar to Cindy Ang’s reason for that, as Claussen says, “gets people to buy into the idea picking Program V. “When we have our brainstorming of performing so that they can see some real results in meetings, I learn what they [the employees] think is their stores. It’s all about seeing that your work serves most pressing, not what some spreadsheet says. It gives a broader purpose. I read about how some companies me a better feel for what’s going on in my store. Num- have been sharing store performance information with bers count, of course, but they don’t tell you everything. employees to get them to understand what their jobs I was also a little worried that employees would be upset really mean and participate in making changes, and if they saw that we aren’t performing well.” I thought that was something we’d be able to do.” Results to Date The HR team came up with five options for the man- agement system. Corporate allowed individual man- Claussen is convinced the most elaborate procedure agers to choose the option they thought would work (Program IV) is the most effective, but not everyone in best with their employees so that managers wouldn’t the executive committee is won over by his advocacy. feel too much like a rapid change was being forced on Although they have supported the test implementation them. Program I is opting out of the new idea, continu- of the system because it appears to have relatively low ing to stay the course and providing employees with costs, others on the committee want to see results. CEO little to no information or opportunities for partici- Jean Masterson has asked for a complete breakdown pation. Program II tracks employee absence and sick of the performance of the various stores over the past leave data and shares that information with individual 4  years. She’s especially interested in seeing how sales employees, giving them feedback about things they can figures and turnover rates have been affected by the control. Management takes no further action. Program new program. III tracks sales and inventory replacement rates across shifts. As in Program II, information is shared with The company has been collecting data in spread- employees, but without providing employee feedback sheets on sales and turnover rates, and it prepared the about absence and sick leave data. Program IV, the following report, which also estimates the dollar cost most comprehensive, tracks the same information as of staff time taken up in each method. These costs Programs II and III. Managers communicate it in week- are based on the number of hours employees spend ly brainstorming sessions, during which employees try working on the program multiplied by their wage rate. to determine what they can do better in the future and Estimates of turnover, profit, and staff time are collect- make suggestions for improving store performance. ed per store. Profit and turnover data include means Program V keeps the idea of brainstorming but doesn’t and standard deviations across locations; profit is net provide employees with information about their behav- of the monthly time cost. Turnover information refers ior or company profits. to the percentage of employees who either quit or are terminated in a month. Since implementing the system, Claussen has spoken with several managers about what motivated them to To see if any patterns emerged in managers’ selec- choose the program they did. Artie Washington, who tion of programs, the company calculated relation- chose Program IV, said, “I want to have my employ- ships between program selection and various attributes ees’ input on how to keep the store running smoothly. of the stores. Program I was selected most frequently Everybody worries about their job security in this econo- by the oldest stores and those in the most economical- my. Letting them know what’s going on and giving them ly distressed areas. Programs II and III were selected ways to change things keeps them involved.” most frequently by stores in urban areas and in areas where the workforce was younger on average. Pro- Betty Alvarez couldn’t disagree more. She selected grams IV and V were selected most frequently in stores Program I. “I would rather have my employees doing in rural areas, and especially where the workforce is their jobs than going to meetings to talk about doing older on average. their jobs. That’s what management is for.” Michael

Case 1 Managing Motivation in a Difficult Economy 691 Program Methods Number of Average Weekly Profit Monthly Staff Stores Turnover per Month Time Cost Program I Traditional management 83 Mean = 30% None 27 SD = 10% Mean = $5,700 $1,960 Program II Share absence and sick leave 35 Mean = 23% SD = $3,000 $2,440 67 SD = 14% Mean = $7,000 $3,420 Program III Share sales and inventory 87 Mean = 37% SD = $5,800 $2,750 SD = 20% Mean = $11,000 Program IV Share information and Mean = 17% SD = $2,700 Program V brainstorm SD = 20% Mean = $13,000 Brainstorm without sharing Mean = 21% SD = $3,400 information SD = 12% Mean = $14,000 SD = $2,400 Your Assignment Program I, which continues the status quo) affect the inferences you can draw about pro- Your task is to prepare a report for the company’s exec- gram success? utive committee on the effectiveness of these programs. CC-7. What are the advantages of randomly assign- Make certain it is in the form of a professional business ing different conditions to the stores instead of document. Your audience won’t necessarily know about using this self-selection process? the organizational principles you’re describing, so make CC-8. How does the changing nature of the work- sure you provide detailed explanations that someone in force and the economy, described in your text- a real business can understand. book and in the case, affect your conclusions about how to manage retail employees? Does When you write, make sure you touch on the follow- the participation of a more experienced work- ing points: force help or hurt these programs? Why might these programs work differently in an economy CC-1. Consider the five management systems as vari- that isn’t doing so poorly? ables in an experiment. Identify the indepen- CC-9. Claussen essentially designed the program dent and dependent variables, and explain on his own, with very little research into goal- how they are related to one another. setting and motivation. Based on your text- book, how well has he done? Which parts of CC-2. Based on the discussion of independent and de- the program appear to fit well with research pendent variables in the textbook, is there any- evidence on goal-setting? What parts would you thing else you’d like to measure as an outcome? change to get more substantial improvements in employee motivation? CC-3. Look over the data and decide which method CC-10. Describe the feelings employees might have of management appears most effective in gen- when these systems are implemented that could erating revenues and reducing turnover, and help or hinder the program’s success. What why. Which methods appear least effective, advice would you give managers about how to and why? implement the programs so they match the principles of organizational justice described CC-4. Are there any concerns you have about these in your textbook? data? CC-5. Does a comparison of the number of stores using each method influence your conclusions at all? CC-6. Does the fact that managers are select- ing the  specific program to use (including

692 Comprehensive Cases 2C a s e Repairing Jobs That Fail to Satisfy Learning Goals would use a competitor the next time they had a plumb- ing problem. Companies often divide up work as a way to improve efficiency, but specialization can lead to negative con- Reynaldo is wondering whether DrainFlow’s job sequences. DrainFlow is a company that has effectively design might be contributing to its problems in re- used specialization to reduce costs relative to its com- taining customers. DrainFlow has about 2,000 employ- petitors’ costs for years, but rising customer complaints ees in four basic job categories: plumbers, plumber’s suggest the firm’s strong position may be slipping. Af- assistants, order processors, and billing representa- ter reading the case, you will suggest some ways it can tives. This structure is designed to keep costs as low create more interesting work for employees. You’ll also as possible. Plumbers make very high wages, whereas tackle the problem of finding people qualified and plumber’s assistants make about one-quarter of what a ready to perform the multiple responsibilities required licensed plumber makes. Using plumber’s assistants is in these jobs. therefore a very cost-effective strategy that has enabled DrainFlow to easily undercut the competition when it Major Topic Areas comes to price. Order processors make even less than assistants but about the same as billing processors. All • Job design work is very specialized, but employees are often de- • Job satisfaction pendent on another job category to perform at their • Personality most efficient level. • Emotional labor Like most plumbing companies, DrainFlow gets The Scenario business mostly from the Yellow Pages and the Inter- net. Customers either call in to describe a plumbing DrainFlow is a large residential and commercial plumb- problem or submit an online request for plumbing ing maintenance firm that operates around the United services, receiving a return call with information States. It has been a major player in residential plumb- within 24 hours. In either case, DrainFlow’s order ing for decades, and its familiar rhyming motto, “When processors listen to the customer’s description of the Your Drain Won’t Go, Call DrainFlow,” has been plas- problem to determine whether a plumber or a plumb- tered on billboards since the 1960s. er’s assistant should make the service call. The job is then assigned accordingly, and a service provider goes Lee Reynaldo has been a regional manager at Drain- to the location. When the job has been completed, Flow for about 2 years. She used to work for a newer via cell phone a billing representative relays the fee to competing chain, Lightning Plumber, that has been the service rep, who presents a bill to the customer for drawing more and more customers from DrainFlow. Al- payment. Billing representatives can take customers’ though her job at DrainFlow pays more, Reynaldo isn’t credit card payments by phone or e-mail an invoice happy with the way things are going. She’s noticed the for online payment. work environment just isn’t as vital or energetic as the environment she saw at Lightning. The Problem Reynaldo thinks the problem is that employees aren’t Although specialization does cut costs significantly, motivated to provide the type of customer service Light- Reynaldo is worried about customer dissatisfaction. ning Plumber employees offer. She recently sent surveys According to her survey, about 25 percent of customer to customers to collect information about performance, contacts ended in no service call because customers and the data confirmed her fears. Although 60 percent were confused by the diagnostic questions the order of respondents said they were satisfied with their expe- processors asked and because the order processors rience and would use DrainFlow again, 40 percent felt did not have sufficient knowledge or skill to explain their experience was not good, and 30 percent said they the situation. That means fully one in four people who call  DrainFlow to hire a plumber are worse than

Case 2 Repairing Jobs That Fail to Satisfy 693 dissatisfied: they aren’t customers at all! The remaining questions. Most of us don’t know any more about 75 percent of calls that did end in a customer service plumbing than the caller. If they don’t use the terms encounter resulted in other problems. on the survey, we don’t understand what they’re talk- ing about. A plumber would, but we’re not plumbers; The most frequent complaints Reynaldo found in we just take the calls.” the customer surveys were about response time and cost, especially when the wrong person was sent to a job. Customer service issues also involve the billing rep- A plumber’s assistant cannot complete a more techni- resentatives. They are the ones who have to keep con- cally complicated job. The appointment has to be re- tacting customers about payment. “It’s not my fault scheduled, and the customer’s time and the staff’s time the wrong guy was sent,” says Elizabeth Monty. “If two have been wasted. The resulting delay often caused guys went out, that’s two trips. If a plumber did the customers in these situations to decline further con- work, you pay plumber rates. Some of these customers tact with DrainFlow—many of them decided to go with don’t get that I didn’t take their first call, and so I get Lightning Plumber. yelled at.” The billing representatives also complain that they see only the tail end of the process, so they “When I arrive at a job I can’t take care of,” says don’t know what the original call entailed. The job is plumber’s assistant Jim Larson, “the customer gets fairly impersonal, and much of the work is recording ticked off. They thought they were getting a licensed customer complaints. Remember—40 percent of cus- plumber, since they were calling for a plumber. Telling tomers aren’t satisfied, and it’s the billing representa- them they have to have someone else come out doesn’t tives who take the brunt of their negative reactions on go over well.” the phone. On the other hand, when a plumber responds to As you can probably tell, all employees have to a job easily handled by a plumber’s assistant, the cus- engage in emotional labor, as described in this text- tomer is still charged at the plumber’s higher pay rate. book, and many lack the skills or personality traits Licensed plumber Luis Berger also does not like being to complete the customer interaction component of in the position of giving customers bad news. “If I get their jobs. They aren’t trained to provide customer called out to do something like snake a drain, the cus- service, and they see their work mostly in technical, tomer isn’t expecting a hefty bill. I’m caught between or mechanical, terms. Quite a few are actually anxious a rock and a hard place—I don’t set the rates or make about speaking directly with customers. The office the appointments, but I’m the one who gets it from the staff (order processors and billing representatives) customer.” Plumbers also resent being sent to do such realize customer service is part of their job, but they simple work. also find dealing with negative feedback from custom- ers and coworkers taxing. Susie McCarty is one of DrainFlow’s order proces- sors. She’s frustrated too when the wrong person is A couple of years ago a management consulting sent to a job but feels she and the other order proces- company was hired to survey DrainFlow worker atti- sors are doing the best they can. “We have a survey tudes. The results showed they were less satisfied than we’re supposed to follow with the calls to find out what workers in other comparable jobs. The following table the problem is and who needs to take the job,” she provides a breakdown of respondent satisfaction levels explains. “The customers don’t know that we have a across a number of categories: standard form, so they think we can answer all their I am satisfied with the work DrainFlow DrainFlow DrainFlow Average Average I am asked to do. Plumbers Plumber Office Plumber Office I am satisfied with my working Assistants Workers Workers conditions. 3.7 2.5 4.3 I am satisfied with my interactions 2.5 3.5 with coworkers. 3.8 3.7 4.1 I am satisfied with my interactions 2.4 4.2 with my supervisor. 3.5 2.7 3.8 3.2 3.9 2.5 2.2 3.5 2.3 3.4

694 Comprehensive Cases The information about average plumbers and aver- structured-interview programs. Make certain it is in the age office workers is taken from the management con- form of a professional business document that you’d sulting company’s records of other companies. They actually give to an experienced manager at this level of aren’t exactly surprising, given some of the complaints a fairly large corporation. Reynaldo is very smart when DrainFlow employees have made. Top management is it comes to managing finances and running a plumb- worried about these results, but they haven’t been able ing business, but she won’t necessarily know about the to formulate a solution. The traditional DrainFlow cul- organizational behavior principles you’re describing. ture has been focused on cost containment, and the Because any new proposals must be passed through top “soft stuff” like employee satisfaction hasn’t been a management, you should also address their concerns major issue. about cost containment. You’ll need to make a strong evidence-based financial case that changing the man- The Proposed Solution agement style will benefit the company. The company is in trouble, and as revenues shrink and When you write, make sure you touch on the follow- the cost savings that were supposed to be achieved by ing points: dividing up work fail to materialize, a change seems to CC-11. Although it’s clear employees are not especially be in order. satisfied with their work, do you think this is a Reynaldo is proposing using cash rewards to reason for concern? Does research suggest sat- improve performance among employees. She thinks if isfied workers are actually better at their jobs? employees were paid based on work outcomes, they’d Are any other behavioral outcomes associated work harder to satisfy customers. Because it’s not easy with job satisfaction? to measure how satisfied people are with the initial CC-12. Using job characteristics theory, explain why call-in, Reynaldo would like to give the order pro- the present system of job design may be con- cessors a small reward for every 20 calls successfully tributing to employee dissatisfaction. Describe completed. For the hands-on work, she’d like to have some ways you could help employees feel more each billing representative collect information about satisfied with their work by redesigning their customer satisfaction for each completed call. If no jobs. complaints are made and the job is handled promptly, CC-13. Reynaldo has a somewhat vague idea about a moderate cash reward would be given to the plumb- how to implement the cash rewards system. er or plumber’s assistant. If the customer indicates Describe some of the specific ways you would real satisfaction with the service, a larger cash reward make the reward system work better, based on would be provided. the case. CC-14. Explain the advantages and disadvantages of Reynaldo also wants to find people who are a bet- using financial incentives in a program of this ter fit with the company’s new goals. Current hiring nature. What, if any, potential problems might procedure relies on unstructured interviews with each arise if people are given money for achieving location’s general manager, and little consistency is customer satisfaction goals? What other types found in the way these managers choose employees. of incentives might be considered? Most lack training in customer service and organiza- CC-15. Create a specific plan to assess whether tional behavior. Reynaldo thinks it would be better if the reward system is working. What are the hiring methods were standardized across all branches dependent variables that should change if the in her region to help managers identify recruits who system works? How will you go about measur- can actually succeed in the job. ing success? CC-16. What types of hiring recommendations would Your Assignment you make to find people better suited for these jobs? Which Big Five personality traits would be Your task is to prepare a report for Reynaldo on useful for the customer service responsibilities the potential effectiveness of her cash reward and and emotional labor?

Case 3 Building a Coalition 695 3C a s e Building a Coalition Learning Goals and measurement staff; the school system will provide classrooms and teaching staff. Many of the most important organizational behavior challenges require coordinating plans and goals among The first stage in bringing this new plan to fruition is groups. This case describes a multiorganizational effort, the formation of an executive development team. This but the same principles of accommodation and com- team will span multiple functional areas and establish promise also apply when trying to work with multiple the operating plan for improving school performance. divisions within a single organization. You’ll create a Its cross-organizational nature means representatives blueprint for managing a complex development team’s from both the Woodson Foundation and the school progress, steering team members away from negative district must participate. The National Coalition for conflicts and toward productive discussion. You’ll also Parental Involvement in Education (NCPIE) is also be asked to help create a new message for executives so going to be a major partner in the program, acting as a they can lead effectively. representative for parents on behalf of the PTA. Major Topic Areas Conflict and Agreement in the Development Team • Group dynamics • Maximizing team performance While it would be perfect if all the groups could work • Organizational culture together easily to improve student outcomes, there is • Integrative bargaining little doubt some substantive conflicts will arise. Each group has its own interests, and in some cases these are The Scenario directly opposed to one another. The Woodson Foundation, a large nonprofit social School district representatives want to ensure the service agency, is teaming up with the public school sys- new jobs will be unionized and will operate in a way con- tem in Washington, D.C., to improve student outcomes. sistent with current school board policies. They are very There’s ample room for improvement. The schools concerned that if Woodson assumes too dominant a role, have problems with truancy, low student performance, the school board won’t be able to control the operations and crime. New staff quickly burn out as their initial of the new system. The complexity of the school system enthusiasm for helping students is blunted by the harsh has led to the development of a highly complex bureau- realities they encounter in the classroom. Turnover cratic structure over time, and administrators want to among new teachers is very high, and many of the best make sure their policies and procedures will still hold and brightest are the most likely to leave for schools for teachers in these programs even outside the regular that aren’t as troubled. school day. They also worry that jobs going into the new system will take funding from other school district jobs. The plan is to create an experimental after-school program that will combine the Woodson Foundation’s Woodson, founded by entrepreneur Theodore Wood- skill in raising private money and coordinating com- son around 1910, still bears the hallmarks of its founder’s munity leaders with the educational expertise of school way of doing business. Woodson emphasized efficiency staff. Ideally, the system will be financially self-sufficient, and experimentation in everything he did. Many of the which is important because less money is available for foundation’s charities have won awards for minimizing schools than in the past. After several months of nego- costs while still providing excellent services. Their focus tiation, the leaders of the Woodson Foundation and on using hard data to measure performance for all their the school system have agreed that the best course is initiatives is not consistent with the school district culture. to develop a new agency that will draw on resources from both organizations. The Woodson foundation will Finally, the NCPIE is driven by a mission to increase provide logistical support and program development parental control. The organization believes that when communities are able to drive their own educational methods, students and parents are better able to achieve success together. The organization is strongly commit- ted to celebrating diversity along racial, gender, ethnic,

696 Comprehensive Cases and disability status categories. Its members are most best. The parents, at least, have more of a stake in this.” interested in the process by which changes are made, “The most important thing is the kids,” says sec- ensuring everyone has the ability to weigh in. ond-year teacher Ari Kaufman. He is well liked by his Some demographic diversity issues complicate the students but doesn’t get along well with other faculty team’s situation. Most of the students served by the members. He’s seen as a “squeaky wheel.” “The schools Washington, D.C., school district are African Ameri- need change so badly. And how did they get this way? can, along with large populations of Caucasians and From too little outside involvement.” Hispanics. The NCPIE makeup generally matches the demographic diversity of the areas served by the public Community organizer Mason Dupree doesn’t like the schools. The Woodson foundation, based in northern level of bureaucracy either. He worries that the school’s Virginia, is predominantly staffed by Caucasian profes- answer to its problems is to throw more money at them. sionals. There is some concern with the idea that a new “I know these kids. I grew up in these neighborhoods. group that does not understand the demographic con- My parents knew every single teacher I had. The schools cerns of the community will be so involved in a major wanted our involvement then. Now all they want is our change in educational administration. The leadership money. And I wouldn’t mind giving it to them if I thought of the new program will have to be able to present an ef- it would be used responsibly, not spent on raises for peo- fective message for generating enthusiasm for the pro- ple who haven’t shown they can get the job done.” gram across diverse stakeholder groups. Meredith Watson, with the Woodson Foundation, Although the groups differ in important ways, it’s also agrees the schools have become less focused on the worth considering what they have in common. All are in- families. A former teacher, she left the field of educa- terested in meeting the needs of students. All would like tion after being in the classroom for 6 years. “There is to increase student learning. The school system does so much waste in the system,” she complains. “Jobs are benefit from anything that increases student test scores. unnecessarily duplicated, change processes are need- And the Woodson Foundation and NCPIE are united in lessly convoluted. Unless you’re an insider already, you their desire to see more parents engaged in the system. can’t get anything done. These parents want to be in- volved. They know their kids best.” Candidates for the Development Team Unlike her NCPIE colleagues, Candace Sharpe thinks the schools are doing the best they can. She is The development team will consist of three individu- a county social worker, relatively new to the D.C. area. als—HR representatives from the Woodson Foundation, “Parents say they want to be involved but then don’t fol- the schools, and the NCPIE—who have prepared the low through. We need to step it up, we need to lead the following list of potential candidates for consideration. way. Lasting change doesn’t come from the outside, it comes from the home.” Victoria Adams is the superintendent of schools for Washington, D.C. She spearheaded the initial commu- Victor Martinez has been at the Woodson Founda- nication with the Woodson Foundation and has been tion for 10 years, starting as an intern straight out of col- building support among teachers and principals. She lege. “It’s sometimes hard to see a situation when you’re thinks the schools and the foundation need to have larg- in the thick of it,” he explains. “Nobody likes to be told er roles than the parents and communities. “Of course they’re doing something wrong, but sometimes it has to we want their involvement and support, but as the pro- be said. We all know there are flaws in the system. We fessionals, we should have more say when it comes to can’t keep the status quo. It just isn’t cutting it.” making decisions and implementing programs. We don’t want to shut anyone out, but we have to be realis- Strategies for the tic about what the parents can do.” Program Team Duane Hardy has been a principal in the Washington Once the basic membership and principles for the area for more than 15 years. He also thinks the schools development team have been established, the program should have the most power. “We’re the ones who work team would also like to develop a handbook for those with these kids every day. I’ve watched class sizes get big- who will be running the new program. Ideally, this set ger, and scores and graduation rates go down. Yes, we of principles can help train new leaders to create an need to fix this, but these outside groups can’t under- inspirational message that will facilitate success. The ac- stand the limitations we’re dealing with. We have the com- tual content of the program and the nature of the mes- munity, the politicians, the taxpayers—everyone watching sage will be hammered out by the development team, what we’re doing, everyone thinking they know what’s but it is still possible to generate some overriding princi- ples for the program team in advance of these decisions.

Case 4 Boundaryless Organizations 697 Your Assignment groups and teams in the textbook to defend your choices. The Woodson Foundation, the NCPIE, and the schools CC-19. Using principles from the chapters on groups have asked you to provide some information about how and teams, describe how you will advise the to form teams effectively. They would like your response team to manage conflict effectively. to explain what should be done at each step of the way, CC-20. Describe how integrative negotiation strategies from the selection of appropriate team members to set- might achieve joint goals for the development ting group priorities and goals, setting deadlines, and team. describing effective methods for resolving conflicts that The following points should help you form a message arise. After this, they’d like you to prepare a brief set of for the program team: principles for leaders of the newly established program. CC-21. Leadersofthenewcombinedorganizationshould That means you will have two audiences: the develop- have a good idea of the culture of the school dis- ment team, which will receive one report on how it can trict, the NCPIE, and the Woodson Foundation effectively design the program, and the program team, because they will need to manage relationships which will receive one report on how it can effectively with all three groups on an ongoing basis. How lead the new program. would you describe the culture of these various stakeholder organizations? Use concepts from The following points should help you form a com- the chapter on organizational culture to de- prehensive message for the development team: scribe how they differ and how they are similar. CC-22. Considerhowleadersofthenewprogramcangen- CC-17. The development team will be more effective erate a transformational message and encourage if members have some idea about how groups employee and parent trust. Using material from and teams typically operate. Review the domi- the chapter on leadership, describe how you nant perspectives on team formation and per- would advise leaders to accomplish these ends. formance from the chapters in the book for the CC-23. Given the potential for demographic fault committee so it can know what to expect. lines in negotiating these changes, what would you advise as a strategy for managing diversity CC-18. Given the profiles of candidates for the issues for program leaders? development team, provide suggestions for who would likely be a good group member and who might be less effective in this situa- tion. Be sure you are using the research on 4C a s e Boundaryless Organizations Learning Goals • Human resources • Organizational socialization The multinational organization is an increasingly com- mon and important part of the economy. This case takes The Scenario you into the world of a cutting-edge music software busi- ness seeking success across three very different national Newskool Grooves is a transnational company develop- and organizational cultures. Its managers need to make ing music software. The software is used to compose important decisions about how to structure work pro- music, play recordings in clubs, and produce albums. cesses so employees can be satisfied and productive do- Founder and CEO Gerd Finger is, understandably, the ing very different tasks. company’s biggest fan. “I started this company from nothing, from just me, my ideas, and my computer. Major Topic Areas I  love music—love playing music, love writing pro- grams for making music, love listening to music—and • Organizational structure and boundaryless the money is nice, too.” Finger says he never wanted organizations to work for someone else, to give away his ideas and let someone else profit from them. He wanted to keep • Organizational culture