ORGANIZATIONAL DEVELOPMENT PROSES

By :Zulfadli OthmanMesnan Supa’adNajmina Md Isa

Why Be Concerned with Process?• Inefficient processes result in losses of:

– Time & time-to-market (i.e., competitiveness)– Quality

– Customers– Employees – Productivity

– Money

Organizational Development’s Five Stages

STAGE 1 : Anticipate a Need for Change

• The first step in manager’s perception that the organizational in a state of disequilibrium or need improvement.

• There must be a felt need. It will convince individuals to adopt new ways.

• Managers must be sensitive to changes in the competitive environment.– “what’s going on out there”

Project managers must lead their teams in performing various project activities

AT&T CorporationThe history of AT&T is in large measure the history of the telephone in the United States. AT&T's roots stretch back to 1875, with founder Alexander Graham Bell's invention of the telephone. During the 19th century, AT&T became the parent company of the Bell System, the American telephone monopoly. The Bell System provided what was by all accounts the best telephone service in the world. The system broke up into eight companies in 1984 by agreement between AT&T and the U.S. Department of Justice. From 1984 until 1996 AT&T was an integrated telecommunications services and equipment company, succeeding in a newly competitive environment. Today, AT&T is a global networking leader, focused on delivering IP-based solutions to enterprise and government customers. Additionally, as AT&T pivots away from traditional consumer services, the company continues to offer consumers and small businesses a breakthrough alternative to traditional services – Voice over IP.

AT&T Corporation

• When a new CEO of AT&T Corporation took over, he made it clear to top executives that it was not business as usual.• In his first week as CEO, he brought in the company’s top 20 officers to tell them that the company’s tradition of keeping people in top jobs as long as they didn’t mess up was over…

CHRYSLER

CHRYSLER

• The Chrysler Group Company is an American automobile producer based in Auburn Hills, Michigan.

• In the year 1925, it was first formed as Chrysler Corporation. From years 1998 until 2007, the company and its subordinates were among the DaimlerChrysler AG, which is now called Daimler AG.

• Before 1998, the Chrysler Corporation marketed under the symbol “C” on New York Stock Exchange.

CHRYSLER• In the early 1990s, Chrysler had terrible customer

service and press relations, with a history of innovation but a current reputation for outdated product.

• Its market share was falling, and its fixed costs and losses were high.

• Bob Lutz, the president, proposed a programme, Customer One.

• The result was impressive as overhead was cut by $4.2 billion in less than 4 years.

• The company reversed its slide into bankruptcy and became profitable.

CHRYSLER

STAGE 2 : Develop the Practitioner - Client Relationship

• The client is the person or organization that is being assisted.

• The development of the relationship is an important determinant of success or failure of an OD program.

• Depends on good impression or match between the practitioner and the client system. (the formation of a psychological contract)

STAGE 2 : Develop the Practitioner - Client Relationship

(cont…)• The practitioner attempts to establish :

– A pattern of open communication– A relationship of trust– an atmosphere of shared responsibility– Issues with rewards, objectives and responsibility

must be clarified.– Must decide when to enter the system and the

role should be.

Accurate effective 2-way communication

Team-building

is high interaction among group members to increase trust and openness

STAGE 2 : Develop the Practitioner - Client Relationship

(cont…)• Examples:

1) Practitioner may intervene with the sanction and approval of top management or without support from lower level of organization.

2) (Internal OD practitioner) - OD started at the vice-presidential level.

3) (External practitioner) – To initiate the OD program.

PROCESSPROCESS

Weaknesses Solution Expected Outcomes

Overview of an Improvement Project

Customer contact lag time

Customer contact lag time

Too much for sales to do

Too much for sales to do

Cannot track ROI back to events

Cannot track ROI back to events

Events are expensiveEvents are expensive

WHICH PROCESSES

???

WHICH PROCESSES

???

Weaknesses Solution(s) Expected Outcomes

RFP lossesRFP losses Higher proposalwin rate (M)

Higher proposalwin rate (M)

Sales feels supported (S)

Sales feels supported (S)

Cost per lead data (M)

Cost per lead data (M)

Improved decision-making (S)

Improved decision-making (S)

Faster follow-up (M)

Faster follow-up (M)

Sample Process Improvement Chart

STAGE 3: THE DIAGNOSTIC PHASE

Collect important data.(important activity providing the organization of client system)

Collect important data.(important activity providing the organization of client system)

Identify problem area and causal relationship(used to determine problem solution)Identify problem area and causal relationship(used to determine problem solution)

STAGE 4: ACTION PLAINS, STRATEGIES, TECHNIQUES• These programs apply such OD techniques as

total quality management (TQM), job design, role analysis, goal setting, team building, and intergroup development.

• More time will be spend on this fourth stage than any of the other stages of an OD program.

Stage 5: Self-Renewal, Monitor And Stabilize

• Once an the program is implemented, the final step is to monitor the result and stabilize the desired chance.

• This stage assesses the effectiveness of change strategies in attaining stat objectives.

• Each stage needs to be monitored to gain feedback on member reaction to change efforts

Stage 5: Self-Renewal, Monitor And Stabilize

• The system members need to know the result of change efforts in order to determine whether they ought to modify, continue or discontinue the activities.

• Once a problem has been corrected and a change program is implement and monitored means must be devised to make sure that the new behavior is stabilized and internalized. The client system needs to develop the capability to maintain innovation without outside support.

Continuous Improvement

• Companies seeking to be successful and survive are faced with the need to continually introduce changes.

• Two kinds companies – those that are changing and those are going out of business. Continual change is way of life.

• The need for the practitioner should decrease and termination..

Formation of Airbus Industries• Airbus Industrie was formally established as a

Groupement d'Interet Économique (Economic Interest Group or GIE) on 18 December 1970.

• It had been formed by a government initiative between France, Germany and the UK that originated in 1967.

• The name "Airbus" was taken from a non-proprietary term used by the airline industry in the 1960s to refer to a commercial aircraft of a certain size and range, for this term was acceptable to the French linguistically.

• Owned by Aeronautic Defence and Space Company (EADS) (80%) and British multinational defence , security and aerospace company (BAE Systems) (20%)

• 52000 employees.

A380

• Break the dominance that Boeing had enjoyed in this market segment since the early 1970s with its 747.

• 20% lower operating costs than the 747-400.• Maximum speed Mach 0.96

(at cruise altitude: 1020 km/h, 634 mph, 551 knots)

• The first A380 was unveiled at a ceremony in Toulouse on 18 January 2005, and its maiden flight took place on 27 April 2005.

• Orders from (2001 – 2006) – 156 units

PROBLEMS

• Wiring problems in 2005.• Has been plagued by a series of problems and

was two years behind schedule. • Airbus pay compensation to airlines for late

delivery of the A380 at least 4.8bn euros.• Cancel orders• The company needs to recoup some of this lost

money

2007 RESTRUCTURING

• On 9 October 2006 Christian Streiff – resigned AIRBUS CEO.

• The board of directors at European Aeronautic Defence and Space Company (EADS) has named Louis Gallois as Airbus chief executive. Gallois has been a member of EADS' Board of Directors since 2000 and became single CEO of EADS 16 July 2007.

On 28 February 2007, CEO Louis Gallois announced the company's restructuring plans

• 10,000 jobs cut over four years; 4,300 in France, 3,700 in Germany, 1,600 in the UK and 400 in Spain. 5,000 of the 10,000 would be at sub contractors.

• Plants at Saint Nazaire, Varel and Laupheim face sell off or closure, while Meaulte, Nordenham and Filton are "open to investors“

• As of 16 September 2008 the Laupheim plant has been sold to a Thales-Diehl consortium to form Diehl Aerospace and the operations at Filton have been sold to GKN of the United Kingdom

On 28 February 2007, CEO Louis Gallois announced the company's restructuring plans

• More work being transferred to the firm's headquarters and main production facility in Toulouse.

• Seeking new investment partners.

AIRBUS EUROPEAN PLANTS FRANCE1. Toulouse: (11,500 staff). Cabin and cargo. Electrics, nose, fuselage, wings.2. Saint Nazaire: (2,300) Nose, centre fuselage.*Faces sell-off or closure3. Nantes: (2,000) Nose, centre fuselage.4. Meaulte: (1,200)Nose, centre fuselage. *Open to investorsGERMANY5. Hamburg: (10,000) Cabin and cargo. Electrics. Fuselage assembly.6. Buxtehude: (350)Cabin and cargo. Communication systems.7. Stade: (1,500)Vertical tail. Design, manufacture, assembly.8. Bremen: (3,100) Cabin and cargo. Fuselage design, production.9. Nordenham: (2,100) Manufacture of fuselage. *Open to investors

10. Varel: (1,100)Machining fuselage parts.*Faces sell-off or closure11. Laupheim: (1,100)Cabin and cargo. Design and manufacture. *Faces sell-off or closureSPAIN12. Getafe: (2,000) Horizontal tail, A380 rear fuselage. Assembly.13. Puerto Real: (500) Horizontal tail and A380 rear fuselage. Production.14. Illescas: (500)Horizontal tail and A380 rear fuselage. Development.UK15. Filton: (6,500)Electrics and wing. Design. *Open to investors16. Broughton: (5,000) Wing. Assembly, manufacture.

RESULTS

• Reduce the time it took to develop new planes from seven-and-a-half years to six years, improve customer service and aircraft reliability.

• Increasing delivery aircraft.• Reduce cost of production.

Orders AND Deliveries2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Total

OrdersA380-800 78 0 34 10 10 24 33 9 4 32 2 236

Deliveries

A380-800 0 0 0 0 0 0 1 12 10 18 19 60

Airbus A380 firm net orders and deliveries (cumulative by year)

THE END