Chapter 25 Developing an Effective Organization

Chapter 25: Developing an Effective Organization Lesson 25.1 The Changing Organizational Environment The New Employment Environment - Many companies faced global competitive pressures unlike those they had seen before - - Forced companies to reconsider their organizational size, structure, and operations - Cut the number of employees - Reduce product offerings - Cutting costs in other ways Restructured their operations to work and use resources more efficiently Many employees who lost their jobs when businesses cut back have been unable to find satisfying employment - Job Security - the likelihood of being employed by the same company in the future - Economic and Political Changes - The Internet has led to the creation of many new organizations that look quite different from traditional businesses - may have only a few employees, and the employees may not work in the same building or even in the same city - few businesses rely on the Internet only, but most have incorporated extensive Internet-based operations within their more traditional operations - International competition has grown dramatically as large firms expand into new markets, develop cooperative agreements with foreign firms, or purchase competing businesses - Freed-trade agreements - treaties between two or more countries that eliminate almost all trade restrictions and subsidies between the countries - The most significant change in political structure affecting international business competition and trade was the development of the European Union - European Union - first and most important international market system in the world - Formed to increase the economic and political power of the countries of Western Europe in the face of growing global competition - Adapting to Change - - Almost all businesses are facing dramatic changes - Presents challenges to both employees and managers - Most of the pressure is presented to the human resources department Two major responsibilities that have emerged for the human resources department include: - Organizational Development - carefully planned changes in the structure and operation of a business to adjust to a competitive business environment - HR managers help companies make changes in the way they are organized - Career Development - an effort to math employees’ career plans with the changing employment needs of the business - HR managers work with individual employees and managers to prepare them to take responsibility for their own career development through effective career planning The Role of Human Resources in Change - The ways businesses organize work and resources also affect their success - - What hinders a business’s ability to meet customer needs? - Inefficient work processes - Delays in receiving needed materials - Problems within channels of distribution In order to maintain their competitiveness companies pay more attention to - - How they structure their organization - How work flows through the business - How employees work together and with their managers Businesses use organizational development to make changes like: - Making improvements in work processes - - Eliminate errors, improve quality, and reduce costs Building effective working relationships - There are many important relationships that contribute to an effective organization such as: - Management-employee relationships - Relationships with people in other organizations with whom the company works - Relationships with the company’s customers Improving Work Processes - One of the purposes of organizational development is to improve the way work is accomplished includes - - Materials and resources used - The organizational structure and relationships among work units - The job duties assigned to individuals and groups - Work procedures and operations But improving work processes also involves the way businesses work with each other as part of product development, production, distribution, sales, and customer service - - Improving the way work is accomplished may require: - Using new technologies - Rearranging work areas - Changing relationships between departments and work groups - Modifying procedures for completing tasks May not be easy for any company to make changes - Employees may be reluctant to use new technologies or change the way they do things - May be difficult to identify new ways to organize and accomplish work Organizational development programs often bring in experts from outside the company to help identify new work processes and to work with employees and managers to help them accept change - Identifying the Need for Change - The causes of a business failure may be that: - Competitors were able to improve their products and services - Customers did not receive the service they expected - Costs were not controlled - The organizational structure did not adjust to new conditions - Failure is most likely from the inability to change - Business Environment - The factors and conditions within which a business operates and that can affects its success - External Environment - Factors and conditions outside the business - Ex. workforce demographics, competition, consumer expectations, technology - Internal Environment - Those occurring inside the business - Ex. makeup of the company’s workforce, employer-employee relationships - - Important Indicators that an Organization Needs to Make Changes: - New competitors entering the market - Introduction of new technologies in other businesses - Changes in laws and regulations - Major changes in products and services offered in markets served - Rapid growth Every organization should pay careful attention to its external and internal environment to monitor those indicators Lesson 25.2: Managing Organizational Change Planning Organizational Development Programs - Every organization should pay careful attention to its external and internal environment to monitor those indicators - - Human resources should be involved because change affects employees Changes may involve developing new employee skills or increasing/decreasing workforce size - Every organization should pay careful attention to its external and internal environment to monitor those indicators - Step 1: Affirm Missions and Goals - Every organization should pay careful attention to its external and internal environment to monitor those indicators - Step 2: Identify Important Markets and Products - The organization needs to identify the important markets that will be the company’s primary focus and the products and services needed to serve those markets. - - Will require establishing customer service standards Customer Service Standards - measures against which the company judges its performance in meeting customer expectations - - May include: - The minimum acceptable levels of product quality - Delivery speed - Order fulfillment accuracy - Customer support and follow up Step 3: Determine Needed Changes - The business must determine the organizational changes required to achieve the company’s mission, goals, and customer service standards, and prepare a plan for implementing the changes - Usually involved one or more of the following factors: - Work processes - The organizational structure - - Work relationships - Employee skills Performance Standards - specific statements of the expected results from critical business activities - Step 4: Build Commitment - Successful organizational change requires the understanding and support of managers and employees - Most likely if all employees are full informed of - The change - The reasons change is necessary - The likely results if the change is not made - How employees will be affected by the change - How the organization and its employees will benefit if the change is successful - Step 5: Follow Through - Employees will support the plan if they see that the organization is committed to it and that change is occurring. - Employees should be informed of the results of the changes even if they are not always positive at the beginning - Step 6: Incorporate the Change - If people believe the change is not important or is only temporary, they will not commit to its success - When the new process is implemented and supported, the organization has changed, and the old procedures are no longer appropriate, the organizational development program is complete Improving the Work Environment - Today, employees are concerned about a variety of factors related to their work, including the work schedule and working conditions - Vacations, insurance, pensions, and other benefits are also important to most people - They also want an interesting and challenging job as well as recognition for their work - - - Both personal and financial needs are important to employees Studies have found that employees are most satisfied with their work when they: - Perform interesting work - Feel responsible for the work - Receive recognition for good work - Have a feeling of achievement Job Design - the kinds of tasks that make up a job and the way workers perform these tasks in doing their jobs Job Enlargement - Organizations try to make work more meaningful and motivating for employees - Job Enlargement - making a job more interesting by adding variety to the tasks - Employees also need training and adequate time and practice to develop the new skills - Companies should not enlarge jobs just to reduce the number of employees or to get employees to do more work Cross Training - Cross Training - When employees are trained to perform more than one job in the company, even though they typically perform only one - Employees can be rotated to other jobs when: - An absence or illness occurs - While a replacement employee is being trained - When a significant increase or decrease in the amount of work occurs for a specific job - To provide change and variety for employees Makes employees more valuable to the company because that person can perform a broader set of work tasks Job Enrichment - Job Enrichment - gives employees the authority to make meaningful decisions about their work - Managers may ask employees for advice on how to improve performance or reduce errors - Job responsibilities may be changed so employees can solve problems themselves without checking with their supervisor - Some companies expand the duties and responsibilities of employees for the wrong reasons - To save money, the companies cut the number of personnel and divide the additional work among the remaining employees - Sometimes done without providing additional training or any recognition for employees given additional work - An improved work environment and worker involvement are important goals of organizational development - - Important organizational programs include: - Improving management and employee relationships - Making work more meaningful - Developing effective work teams some organizational development programs work to improve relationships in the external environment, including the way employees interact with other businesses in the distribution channel and with customers Lesson 25.3: Career Development The Importance of Career Development - - Successful businesses view their relationships with employees very differently today - Realize that it is not easy to find employees with the required qualifications - Also very expensive to hire and train a new employee Companies invest in employees and want to get the greatest value from them - Occurs when companies hire employees with skills that closely match the needs of the job, train them, and then keep them happy, so they will want to contribute to achieving the company’s goals. - Changing technology requires employees to regularly update their skills - Today, companies process information with computers - To get the needed skills, businesses offer training to current employees when new technology requires it and search for new employees with up-to-date skills to fill vacancies Career Development Planning - Career Development Program - a plan for meeting the company’s future employment needs by systematically preparing current employees for future positions in the company - Human resources personnel are responsible for its development but need support of all parts of the company - - Requires: - A long-term organizational plan - Career paths - Effective employee performance reviews - Career counseling - Training and development for employees Long Term Plans - Career development starts with the job opportunities in a company - must determine what jobs will be available in the future, how many people will be needed in each job, and the knowledge and skills those employees will require - Career Paths - Career Path - a progression of related jobs with increasing skill requirements and responsibility - Provide opportunities for employees to advance within the company, make additional contributions, and receive greater satisfaction from their work - Companies need to make other opportunities available so that employees are not locked into one job if they choose not to become managers or are unable to qualify for management positions. - Each job in the company should be part of a career path, and employees should be aware of the paths available to them - Performance Reviews - Employees need accurate information on their skills and abilities to make good career decisions - When employees know how well they are performing, they can determine what skills they need to improve to meet current job requirements or to qualify for another job in a career path - Together, the manager and employee determine whether the employees need additional training to improve performance and to advance in the organization - Career Counseling - For career development to be effective, employees must be aware of opportunities and plan their career paths - The human resources department offers career information and counseling services as part of the career development program - Managers are often trained to provide career information to the employees they supervise - Individual Career Plan - the jobs that are part of the employee’s career path, the training needed to advance along the career path, and a tentative schedule for the plan’s activities - Jointly developed by the employee, a human resources specialist, and usually the employee’s manager - Career Centers - facilities where human resources employees manage career development activities - Training and Development - The final part of a career development program is helping employees obtain the training and education they need for changing job requirements and new jobs - companies can develop training programs and other educational opportunities to prepare employees for new job requirements before the need arises Implementing a Career Development Program - Businesses that want to match employees and jobs successfully must do several things to ensure that the career development program works well - Responsibility for organizing and managing the career development program is usually assigned to the human resources department - The department does much of the initial planning and puts together the people, resources, and procedures needed for the program - Everyone in the business must be educated about the career development program and his or her role in career planning - Managers must also evaluate employee performance and include career planning in follow-up conferences - - Help identify employees who are ready for career advancement - serve as coaches and mentors to help each worker make effective career choices Employees should be aware of career development resources and how the careerplanning process works - Responsible for much of their individual career planning and development but must know where to get help when they need it - use performance reviews and evaluation conferences to gather information to make career plans - The human resources department manages the career development program - Specialists provide career counseling, training, and help in understanding the performance review process Special Career Development Programs - Companies that offer career development programs should make the services available to all employees - But, there are situations in which specific individuals or groups of employees participate in programs designed to meet specific needs in the company - Most large businesses offer career planning, training, and counseling to employees selected to be managers - Receive testing services, obtain experience in all parts of the business, and often are assigned to an experienced manager who serves as a role model and mentor - Companies may make extra efforts to encourage and prepare people from the underrepresented gender for those jobs - Some companies may have difficulty finding qualified candidates for certain jobs - Those positions may be targeted for career development attention Lesson 25.4 Business Careers - Business careers are appealing because of the number and variety of jobs available and the opportunities for advancement - Once you have obtained your first job and gained both experience and knowledge of business procedures, many opportunities open up - Because common areas of knowledge and skills are important to many types of businesses, you are not limited to one career path, one type of business, or one geographic area - Levels of Employment - Businesses have several levels of employment, based on the amount of education and experience required - Common levels: entry, career, specialist, management, and executive/entrepreneur - - Entry-Level Occupations - involve routine activities and require little training - Open to people with little or no previous business education or experience - Ex. cashier, clerk, receptionist, operator Career-Level Occupations - have the authority to control some of their work and make some decisions - Workers should have a basic understanding of business and skills in the areas in which they are working - Ex. sales associate, manufacturing technician, bank teller Specialist Occupations - require a variety of skills in one or more business functions and extensive understanding of the operations of a specific company or industry - Considered the most skilled or expert in the activities they perform on the job - Ex. buyers, researchers, website designers, programmers, analysts - Supervisor/Management Occupations - responsible for specific units in a business and must make decisions about operations and personnel - Hold the first levels of management positions - Must have a high level of knowledge in the parts of the organization that they supervise - - Must be effective decision makers and have strong leadership ability - Job titles in this level include supervisor, assistant manager, and manager - Often called team leaders Executive/Entrepreneur Occupations - fully responsible for the success or failure of the company - Must possess a comprehensive understanding of business and management - They spend most of their time planning and evaluating the work of the organization - Job titles in this level include vice president, president, chief executive, and owner - Careers in International Business - The growth of trade between countries and increasing global competition provide continuing evidence of the importance of international business - As businesses expand into international markets, so do the opportunities for international business careers - International business careers have all the advantages of a career in one country plus more - The international businessperson must be familiar with the cultures of the countries in which the business will operate or to which the company’s products and service are directed - The economic and political environments of countries is another important area of study Preparing for a Business Career - People who are not familiar with business may have difficulty determining what preparation they need and how to obtain the job they want - Today, a person is less likely to enter a business career without specific preparation - People who understand the requirements and carefully plan to develop the necessary skills are more likely to succeed in business - Business is usually one of the largest degree programs in colleges and universities - Experience in business is always an advantage - Can give you confidence and develop important communication and interpersonal skills. - Beginning employees who stay with one employer for a length of time and receive favorable evaluations will find it easier to receive promotions or be hired by an employer offering a better job Developing an Individual Career Plan - Steps for Developing Your Own Career Plan: 1. Develop an understanding of business concepts and the different types of business careers 2. Complete a self-assessment of your knowledge, skills, and attitudes that are related to those needed in business careers 3. Identify the education and experience requirements for business careers that interest you 4. Discuss the education and experience you will need with people (counselors or businesspeople) who are familiar with education programs and employment opportunities 5. Develop a career plan that identifies the knowledge and skills needed for the career you have chosen and how you will develop them through a combination of education and experience Preparing a Career Portfolio - Career Portfolio - an organized collection of information and materials you develop to represent yourself, your preparation, and your accomplishments - Should provide clear descriptions of your preparation, skills, and experience - Can include examples of projects you have completed in school and on the job or for organizations to which you belong. - Can include evaluations of your skills and work evidenced through tests, checklists of competencies you have mastered, and performance reviews from employers - A portfolio is a good way to identify important materials that will help you with your self-assessment - Also keeps materials organized so you can show them to others to demonstrate achievement, or as you apply for educational programs and jobs