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5 Adapt and Rejuvenate: Agile and Learning Organizations
iStock/Rawpixel Ltd/Thinkstock
Learning Objectives
After reading this chapter, you should be able to do the
following:
1. Analyze key traits of successful change leaders.
2. Describe how agile organizations approach change compared
to traditional ones.
3. Examine the characteristics, levels, and principles of learning
organizations.
4. Explain the relationship between learning and change in
organizations, the process a company goes
through to become a learning organization, and the importance
of leadership.
5. Summarize the mind-set that both agile and learning
organizations must have in the 21st century.
wei82650_05_c05_207-248.indd 207 12/15/15 9:46 AM
© 2015 Bridgepoint Education, Inc. All rights reserved. Not for
resale or redistribution.
Introduction
Change is the status quo. Companies the world
over realize that success depends on their ability
to respond to new opportunities and threats as
they emerge, and to keep rethinking their
strategies, structures, and tactics to gain
ephemeral competitive advantages.
—Perry Keenan, Stephanie Mingardon, Harold Sirkin,
and Jennifer Tankersley
Pretest Questions
1. True/False: The traditional leadership traits of decisiveness
and composure con-
tinue to rank high in current change leadership models.
2. True/False: Agile organizations tend to have a high tolerance
for failure.
3. True/False: A learning organization is holistic, which means
it considers how the
entire industry and business market contribute to its specific
goals.
4. True/False: Learning organizations respond well to market
swings because they can
bring in outside marketing experts to advise them on how to
react.
5. True/False: In the 21st century, both agile and learning
organizations must accept
that change demands doing things differently.
6. True/False: Tension can actually be a source of energy and
renewal for a learning
organization.
Hyundai’s current successes may be surprising to those who
know its past. The Korean
automotive company has shed its former image of producing
low-quality, “me-too” vehicles—
and the experience of suffering a near collapse in sales in
1998—and replaced it with that of a
$66 billion company that controls 5% of the market today
(Holstein, 2013). The company’s cars
have vastly improved and are moving to the top of the list in
quality: J. D. Power and Associates
ranked Kia (owned by Hyundai) as number two, behind Porsche,
and Hyundai as number four,
behind Jaguar (Levin, 2015).
This change happened by design, not by chance. Hyundai’s
skills in design, product launch, and
consumer awareness are credited to its recently implemented
product management model. The
company’s overall success is attributed to the fact that it has
focused leadership; a dynamic
culture; competitive strategies; high-quality products;
innovative design; operational excellence;
shrewd marketing; and an empowered, disciplined workforce.
wei82650_05_c05_207-248.indd 208 12/15/15 9:46 AM
© 2015 Bridgepoint Education, Inc. All rights reserved. Not for
resale or redistribution.
Introduction
Chung Mong-Koo, chair of Hyundai Motor Company, assumed
leadership in 2000. He succeeded
his father, Chung Ju-Yung, who founded the Hyundai Group.
Chung has rejuvenated the
workplace, changing Hyundai’s culture and its overall approach
to auto manufacturing. The
company’s redefined culture emphasizes learning and
innovation. This focus became clear in
2009, when Chung began recruiting top-level design talent from
Germany, Italy, and the United
States (Holstein, 2013) to execute his new design approach:
fluidic sculpture, inspired by natural
shapes. The company’s new designers are young and keep an
edgier, innovative culture that has
a degree of fearlessness (Levin, 2015).
Chung didn’t make these changes alone. John Krafcik, CEO of
U.S. operations, helped Chung
implement new strategies to move the company forward through
2013, which employees
meticulously executed. Hyundai’s workplace culture operates
with a mix of Korean superiors
and coordinators who are mostly U.S.-educated and more
Westernized than their counterparts
in Seoul. Coordinators help bridge communications between
Western and Eastern employees
and in some ways are equals of the U.S. executives for whom
they work (Holstein, 2013).
As the company expands its global reach, its major concerns
include balancing quality with
production and innovation with sustainable reliability, while
maintaining an entrepreneurial
pace in a hypercompetitive environment.
Critical-Thinking Questions
1. What are some competitive advantages Hyundai has shown
that have contributed to
its marketplace success?
2. What changes has Hyundai made to evolve from a low-
quality, me-too company to a
significant global competitor? (In your answer, refer to concepts
in the text as well as
specifics in the opening scenario.)
wei82650_05_c05_207-248.indd 209 12/22/15 10:21 AM
© 2015 Bridgepoint Education, Inc. All rights reserved. Not for
resale or redistribution.
Introduction
Introduction: The Road Ahead
We began this text by defining different types of change and
showing how organizational
change can be diagnosed, planned, and implemented. In the
chapters that followed, strategies
and methods for sustaining change were presented. Here we
examine how organizations can
adapt to continuous change by emphasizing innovation,
creativity, agility, and learning, as is
the case with Hyundai.
Leading people is a crucial part of whether an organization
successfully adapts to continuous
change. Although leaders must facilitate and manage change by
articulating clear strategies
and creating flexible structures, they must also create a culture
that sustains not only the
“hard” dimensions of change (like strategies, structures, and
systems) but also its “soft”
dimensions, which involve motivating and developing people to
higher performance levels.
While transformational change happens rapidly and sometimes
dramatically, organizations
must also continue to make equally dramatic adjustments to
survive and succeed (Paton &
McCalman, 2000). At the same time, developing cultures that
attract high-quality talent
involves learning, innovation, and creativity.
Motorola’s 2011 restructuring exem-
plifies this type of continuous inno-
vation and creativity. The company
successfully split from a unified cor-
porate parent into Motorola Solu-
tions, which houses its businesses
that manufacture wireless devices
that are sold mainly to enterprises
and governments; and Motorola
Mobility, which sells cell phones and
set-top boxes to consumers. CEO
Greg Brown has helped engineer
the transformation from cell phone,
cable set-top box, wireless network,
automotive, and barcode scanner
divisions to a pure-play public-safety
LTE, a network technology that offers
high speeds and low lag times over
long distances. (Among other uses, it
provides first responders with valu-
able photos, video, and other infor-
mation via police radios equipped with specially designed
smartphones and other devices).
The turnaround involved trimming $500 million in annual
operating expenses in 3 years,
changing out 21 of 70 vice presidents, and adding 20% more
sales staff (Pletz, 2015).
Organizations that plan, implement, and strive to sustain change
must continually adapt
to unforeseen global competition, uneven economic shifts, new
technologies, and the rapid
increase of available data. Other challenges may be indirect and
less dramatic, such as learn-
ing how best to incorporate recent graduates into the workforce
when they may lack certain
skills because educational systems can’t keep pace with changes
in the workplace (Marquardt,
AP Photo/Richard Drew
CEO of Motorola
Solution
s Greg Brown helped Motor-
ola Inc. split into two successful companies, Motorola

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  • 1. Sheet1project codeproject nameEmployeesQB280001Account Management Team for 3 yearsEngineer 1QB280002Test & Maintenance DesignEngineer 2QB280003Chino Jr MEER UpgradeEngineer 3QB280003Chino Phase 1Engineer 4QB280004PM & PA Dedicated ResourcesEngineer 5QB280005CISEP - LugoEngineer 6QB280006CISEP - VincentEngineer 7QB280007CISEP - MiralomaEngineer 8QB280008CISEP - El DoradoEngineer 9QB280009Ultra SE Test Engineer 10QB280010RCRO - Rancho Cucamonga Reg OfficeEngineer 11QB280011Santiago - ACSEngineer 12QB280012Red Bluff CRAS ACSEngineer 13QB280015Shawnee Substation ...Engineer 14QB280016Lugo Gate RemovalEngineer 15QB280017Valley DFR PMUEngineer 16QB280018Devers DFR PMUEngineer 17QB280019Devers PerimeterEngineer 18QB280020Palm Springs SC - ...Engineer 19QB280022Arrowhead Service CenterEngineer 20QB280023VictorvilleEngineer 21QB280024Menifee Door ReplacementEngineer 22QB280025Badge StockEngineer 23QB280026Redlands SCEngineer 24QB280027Devers Retrofit MEEREngineer 25QB280028Threat AssessmentEngineer 26QB280029San Bernardino DFR PMUEngineer 27QB280030Ontario SC- Security UpgradeEngineer 28QB280031Video WallEngineer 29QB280032Ontario SC- Garage DoorEngineer 30QB280033Valley ABEngineer 31QB280034Threat AssessmentEngineer 32QB280035Chino Air NVR RefreshEngineer 33QB280038Barstow (Upgrade)Engineer 34QB280039Rancho Vista Driving School PIDSEngineer 35QB280040Westminster SSID PedestalEngineer 36QB280041Mountainview 9 / 40 NVR RefreshEngineer 37QB280041Mt View Gen Stn NVR RefreshEngineer 38QB280041Mountainview SubEngineer 39QB280042Viejo Sub Telecom RackEngineer 40QB280043Miraloma Sub DFREngineer 41QB280044Westminster CF Gate AccessQB280045Rector Sub Test & MaintenanceQB280046
  • 2. Mesa Sub RedesignQB280047Santa Ana Sub Lyon Gate Ped Gate AddQB280048PIV 1 Lobby Cam AddsQB280049PIV 2 Lobby Cam AddsQB280051Orange Coast SC Monitor AddQB280052Palm Springs SC Roll Up DrQB280053Fullerton SC Monitor Add 5 Adapt and Rejuvenate: Agile and Learning Organizations iStock/Rawpixel Ltd/Thinkstock Learning Objectives After reading this chapter, you should be able to do the following: 1. Analyze key traits of successful change leaders. 2. Describe how agile organizations approach change compared to traditional ones. 3. Examine the characteristics, levels, and principles of learning organizations. 4. Explain the relationship between learning and change in organizations, the process a company goes through to become a learning organization, and the importance of leadership. 5. Summarize the mind-set that both agile and learning organizations must have in the 21st century. wei82650_05_c05_207-248.indd 207 12/15/15 9:46 AM © 2015 Bridgepoint Education, Inc. All rights reserved. Not for
  • 3. resale or redistribution. Introduction Change is the status quo. Companies the world over realize that success depends on their ability to respond to new opportunities and threats as they emerge, and to keep rethinking their strategies, structures, and tactics to gain ephemeral competitive advantages. —Perry Keenan, Stephanie Mingardon, Harold Sirkin, and Jennifer Tankersley Pretest Questions 1. True/False: The traditional leadership traits of decisiveness and composure con- tinue to rank high in current change leadership models. 2. True/False: Agile organizations tend to have a high tolerance for failure. 3. True/False: A learning organization is holistic, which means it considers how the entire industry and business market contribute to its specific goals. 4. True/False: Learning organizations respond well to market swings because they can
  • 4. bring in outside marketing experts to advise them on how to react. 5. True/False: In the 21st century, both agile and learning organizations must accept that change demands doing things differently. 6. True/False: Tension can actually be a source of energy and renewal for a learning organization. Hyundai’s current successes may be surprising to those who know its past. The Korean automotive company has shed its former image of producing low-quality, “me-too” vehicles— and the experience of suffering a near collapse in sales in 1998—and replaced it with that of a $66 billion company that controls 5% of the market today (Holstein, 2013). The company’s cars have vastly improved and are moving to the top of the list in quality: J. D. Power and Associates ranked Kia (owned by Hyundai) as number two, behind Porsche, and Hyundai as number four, behind Jaguar (Levin, 2015). This change happened by design, not by chance. Hyundai’s skills in design, product launch, and consumer awareness are credited to its recently implemented product management model. The company’s overall success is attributed to the fact that it has focused leadership; a dynamic culture; competitive strategies; high-quality products; innovative design; operational excellence; shrewd marketing; and an empowered, disciplined workforce.
  • 5. wei82650_05_c05_207-248.indd 208 12/15/15 9:46 AM © 2015 Bridgepoint Education, Inc. All rights reserved. Not for resale or redistribution. Introduction Chung Mong-Koo, chair of Hyundai Motor Company, assumed leadership in 2000. He succeeded his father, Chung Ju-Yung, who founded the Hyundai Group. Chung has rejuvenated the workplace, changing Hyundai’s culture and its overall approach to auto manufacturing. The company’s redefined culture emphasizes learning and innovation. This focus became clear in 2009, when Chung began recruiting top-level design talent from Germany, Italy, and the United States (Holstein, 2013) to execute his new design approach: fluidic sculpture, inspired by natural shapes. The company’s new designers are young and keep an edgier, innovative culture that has a degree of fearlessness (Levin, 2015). Chung didn’t make these changes alone. John Krafcik, CEO of U.S. operations, helped Chung implement new strategies to move the company forward through 2013, which employees meticulously executed. Hyundai’s workplace culture operates with a mix of Korean superiors and coordinators who are mostly U.S.-educated and more Westernized than their counterparts in Seoul. Coordinators help bridge communications between Western and Eastern employees and in some ways are equals of the U.S. executives for whom
  • 6. they work (Holstein, 2013). As the company expands its global reach, its major concerns include balancing quality with production and innovation with sustainable reliability, while maintaining an entrepreneurial pace in a hypercompetitive environment. Critical-Thinking Questions 1. What are some competitive advantages Hyundai has shown that have contributed to its marketplace success? 2. What changes has Hyundai made to evolve from a low- quality, me-too company to a significant global competitor? (In your answer, refer to concepts in the text as well as specifics in the opening scenario.) wei82650_05_c05_207-248.indd 209 12/22/15 10:21 AM © 2015 Bridgepoint Education, Inc. All rights reserved. Not for resale or redistribution. Introduction Introduction: The Road Ahead We began this text by defining different types of change and showing how organizational change can be diagnosed, planned, and implemented. In the chapters that followed, strategies and methods for sustaining change were presented. Here we examine how organizations can
  • 7. adapt to continuous change by emphasizing innovation, creativity, agility, and learning, as is the case with Hyundai. Leading people is a crucial part of whether an organization successfully adapts to continuous change. Although leaders must facilitate and manage change by articulating clear strategies and creating flexible structures, they must also create a culture that sustains not only the “hard” dimensions of change (like strategies, structures, and systems) but also its “soft” dimensions, which involve motivating and developing people to higher performance levels. While transformational change happens rapidly and sometimes dramatically, organizations must also continue to make equally dramatic adjustments to survive and succeed (Paton & McCalman, 2000). At the same time, developing cultures that attract high-quality talent involves learning, innovation, and creativity. Motorola’s 2011 restructuring exem- plifies this type of continuous inno- vation and creativity. The company successfully split from a unified cor- porate parent into Motorola Solu- tions, which houses its businesses that manufacture wireless devices that are sold mainly to enterprises and governments; and Motorola Mobility, which sells cell phones and set-top boxes to consumers. CEO Greg Brown has helped engineer the transformation from cell phone, cable set-top box, wireless network,
  • 8. automotive, and barcode scanner divisions to a pure-play public-safety LTE, a network technology that offers high speeds and low lag times over long distances. (Among other uses, it provides first responders with valu- able photos, video, and other infor- mation via police radios equipped with specially designed smartphones and other devices). The turnaround involved trimming $500 million in annual operating expenses in 3 years, changing out 21 of 70 vice presidents, and adding 20% more sales staff (Pletz, 2015). Organizations that plan, implement, and strive to sustain change must continually adapt to unforeseen global competition, uneven economic shifts, new technologies, and the rapid increase of available data. Other challenges may be indirect and less dramatic, such as learn- ing how best to incorporate recent graduates into the workforce when they may lack certain skills because educational systems can’t keep pace with changes in the workplace (Marquardt, AP Photo/Richard Drew CEO of Motorola Solution
  • 9. s Greg Brown helped Motor- ola Inc. split into two successful companies, Motorola