2. Introduction
By failing to prepare, you are preparing to fail.
Benjamin Franklin
Pretest Questions
1. True/False: The most critical factor in diagnosing an
organization’s need for change
is the opinions of its nonexecutive employees.
2. True/False: The organizational life-cycle model helps leaders
understand how
employees and managers cyclically join, mature, change, and
leave or rejoin a rejuve-
nated organization.
3. True/False: Trigger questions are questions that change teams
or a change specialist
might ask to identify who and what part of an organization
needs to change.
4. True/False: Unlike traditional problem-solving approaches,
the appreciative inquiry
(AI) approach creates positive change by appreciating the best
of what exists in an
organization.
5. True/False: When implementing the action research model, a
change specialist must
be in charge of everyone else in order to teach the
organization’s change team how
to move forward.
3. 6. True/False: Asking for feedback from those who strongly
resist change often starts
them on the path to accepting change.
On March 24, 2015, Zappos’s CEO Tony Hsieh (pronounced
“shay”) sent a company-wide memo
stating Zappos’s change strategy of becoming a manager-free
organization on April 30. His
message was clear: Embrace self-management or leave the
company (Feloni, 2015a). The online
shoe and clothing retail firm is a wholly owned subsidiary
purchased by Amazon for $1.2 billion
in 2009. Zappos employs 1,500 people, has annual revenues of
$2 billion, and is no stranger to
new and unique organizational practices.
Hsieh came to Zappos as an angel investor in 1999 after selling
LinkExchange—which he
cofounded—to Microsoft in 1998 for $265 million, and he
became full time in 2000 (Hsieh, 2010).
He and his team increased online sales from $0 in 1999 to $70
million by 2003, and in 2008 they
reached $1 billion in gross merchandise sales before selling the
company to Amazon. In 2010
Hsieh attributed the company’s success to “customer service,
company culture, and employee
training and development” (Hsieh, 2010, “What We’re Learning
from Amazon,” para. 8).
Continuing his drive toward greater growth, Hsieh began
experimenting with a self-
management organizational structure known as Holacracy in
2013. Holacracy is a horizontal
type of organizational structure composed of circles where
“equally privileged employees work
autonomously in codependency with other circles, sometimes
6. course, is the very opposite of
effective change management. In an increasingly globalized
world, in which change occurs at
an ever faster rate, a good business must always have a set of
short- and long-term goals and
a detailed strategy for reaching them. As the Zappos
transformational change suggests, having
a goal is only part of a large-scale change process. There are
other important elements involved
in diagnosing a change as well. This chapter focuses on the first
steps of that process: the diag-
nosing and planning methods that effectively prepare
organizations to respond to change.
Diagnosing organizational change raises the
key diagnostic questions to be asked by those
planning an organizational change: the why,
what, who, and how of the change. For example,
the opening scenario raises the question of
why Zappos’s CEO decided to move so quickly
to adopt a completely self-managed structure.
Were there forces in the external or interna-
tional organizational environment that precipi-
tated the need for this change?
In addition, what exactly needed to be changed
at Zappos? Were some of its internal systems
not meeting expectations? Were any of the
groups (sales, marketing, or operations) not
performing according to plan? Why change the
entire management and employee structure?
The company had a collaborative, horizontal
structure (Holacracy) that seemed to have been working the
previous few years. Was there a
need to change the structure based on Zappos’s organizational
and leadership life cycle? The
7. company was founded in 1999 but had successfully undergone
several organizational life-
cycle phases, showing increasing revenue and other
effectiveness measures.
Another question to be asked is who needed to change—the
managers? It might seem so,
since the reorganization was shifting to a self-managed, peer-
based system. How would the
other stakeholders in and outside of Zappos be affected—
namely the surviving employees,
managers, customers, and officers? Finally, how did and will
this change continue to roll out?
Hsieh’s e-mail jump-started the process, which seemed to many
like a fait acommpli (that is, a
decision already made without discussion). We will return to
Zappos and these questions as
we present different frameworks in this chapter.
Zappos is not representative of the majority of organizations
across industry sectors. It does,
however, present organizational issues, questions, and lessons
from which leaders, team
members, and students of organizational change can learn. For
example, is Hsieh respond-
ing to a problem, opportunity, both, or neither? Do classic and
contemporary organizational
change models and concepts address opportunity creation as
well as problems and threats to
be solved? We would answer yes to the latter question and will
address the former through
the models presented here.
AP Photo/The Grand Rapids Press, Cory Morse
Zappo’s CEO, Tony Hsieh, raised many
9. • Implementing new IT software
Because nearly three quarters of large organizational changes
fail (Dinwoodie, Pasmore,
Quinn, & Rabin, 2013; Keller & Aiken, 2009; Kotter, 1996), it
is important to diagnose lead-
ers’ and managers’ motives for changing and understand what is
to be changed, what type of
change is appropriate, and the change’s strategy.
Transformational changes are very costly in
human, material, and financial terms, so they must be done
correctly.
It is important to note at the outset that large-scale planned
changes are messy, nonlinear, and
in general only as effective as the people leading and sustaining
them. Such leadership includes
knowing why, when, what, and who to change, but also knowing
when not to change. Kesar
(2001) cautions that change is not always the cure for all
business problems. Instead, leaders
should take the time to evaluate and prioritize change proposals
and ideas, rather than imme-
diately reacting to internal and external changes. In this way,
failing to change can be positive.
Kesar is suspicious of business trends that encourage
organizational reconfiguration every 5
years and the symbolic value of change as a demonstration of
management’s success (Czar-
niawska-Joerges & Sevón, 1996). In the 21st century necessary
change is more a constant than
a luxury; nevertheless, organizational leaders have the
responsibility to determine whether
changes are needed and, if so, what type of change will work in
their particular situations.
11. Although such change models are simplifications of reality,
they provide both a context in
which organizations operate and highlight the interrelationships
among their internal dimen-
sions, which helps identify desired effectiveness.
Although change models do not necessarily provide the “one
best way” or “the truth” about
diagnosing organizations, they offer theoretical and practical
ways to understand complex
situations. Burke (2011) offered five purposes of organizational
models:
1. Models help reduce the complexity of thousands of things
“going on” into manage-
able categories.
2. Models identify aspects of organizational activities and
dimensions that demand
attention.
3. Models highlight the interconnectedness of organizational
properties like culture,
structure, and strategy.
4. Models provide a common language and vocabulary.
5. Models offer a sequence of actions that users can follow in
particular change
situations.
As stated earlier, the expertise of an organization’s leaders,
managers, and change specialists
are perhaps the most critical factors for diagnosing, planning,
and implementing changes.
Consequently, leaders are the ones who must ultimately make
12. decisions based on model pro-
jections. Diagnostic models can also help detect and prevent
type 1 and 2 errors (discussed
in Chapter 1.4) from occurring.
We have selected both classic and contemporary models to
discuss in greater detail. They
include: (a) classic models that led the way and are still
relevant, (b) models that are based
on different assumptions and view change from various
perspectives, (c) macro and micro
dimensions that are emphasized in the models, and (d) models
that require different quanti-
tative and qualitative approaches to diagnose responses to
change.
This chapter organizes change models by the dimensions Why
Change, What and Who
to Change, and How to Change. These three dimensions and the
models presented are in
some ways interrelated. However, separating out major models
with consultative ques-
tions in each dimension helps leaders and change teams pay
attention to the systematic
process of change as well as the desired end results. We begin
by addressing the dimension
Why Change by asking what is the need and what is the source?
The major models in the
first section include open systems, environment-industry-
organization contingency, and
the organizational life cycle. Consider these tools and concepts
that can be used to diag-
nose change.
Check Your Understanding
14. 2.2 Why Change? Identifying the Need to Change
How do organizational leaders and others determine why a
change is needed? Sometimes
the reasons are obvious, other times less so. In the opening
case, it was not entirely clear why
Zappos’s CEO called for a sweeping organizational change.
Some observers also questioned
the way the change was implemented. Diagnosing the reason
and need for change begins with
an analysis of both the external and internal organizational
forces effecting a change.
Open-Systems Theory
Open-systems theory and model, based on Katz and Kahn’s
(1978) work, provides a frame-
work for studying how organizations interact with their
environments in ways that affect the
input, throughput, and output processes, along with
interdependencies and outcomes. The
model, shown in Figure 2.1, indicates how a product or service
produced at the output phase
is influenced by the organization’s environment and internal
processes. This model is widely
used by consultants and other organizations planning changes.
As Figure 2.1 illustrates, an open-systems approach can serve as
the first step in diagnosing
an organizational change since it presents a big-picture
approach for identifying the input,
throughput, and output of resources comprising and needed in
the change. As discussed in
Chapter 1, diagnosing how the forces in the general
environment (that is, the economic, tech-
nological, legal, governmental–political, sociocultural, and
15. natural disaster elements) affect
an organization in any and all of the three open-systems
dimensions provides insights into
the need for an organizational response and, perhaps, change.
An organization’s “task envi-
ronment” takes a closer look at the forces that affect
organizations more directly—that is,
customers, interest groups, suppliers, competitors, employees,
and regulations from govern-
ing bodies. Perhaps Hsieh at Zappos reasoned that less
managerial bureaucracy would serve
a changing customer base more effectively and efficiently.
Figure 2.1: The open-systems approach
The open-systems approach is a process showing how the
environment changes with the input of
resources, followed by the throughput of transformational and
organizational processes, such as
leadership, strategy, structure, culture, and systems. This results
in the output, or the product or
service outputs.
Source: Adapted from Katz, D., and R. Kahn. (1978). The
social psychology of organizations (2nd ed.) New York: Wiley.
Environment Environment
Product,
Service
Outputs
OutputThroughputInput
Transformational
Organizational
17. outdated images of nursing, new nurse recruitment, and
retention of nurses, closer scrutiny
of this shortage shows that one underlying cause of the problem
is the level of expertise avail-
able compared to what is needed (Ming et al., 2012.)
From this partial diagnosis, nursing associations, educational
programs, and care-providing
institutions can consider strategies for change in how they
attract, educate, and generate
more specialized nurses. With this context in mind, we will look
at the input, throughput, and
output dimensions for a hypothetical educational institution
with a large nursing program.
First, note that the inputs are resources, information, or items
that are intentionally put into
an organization’s internal system that effect and/or will be
affected by the intended change.
Outputs are the results that occur after an organization’s
interventions affect the targets of
the change process. In other words, outputs are the results from
a department, division, or
entire organization’s change process (Krippendorff, 1986).
At the input phase, a college program might analyze
demographics and other statistics about
its student nursing recruitment and the enrolled population to
see what changes and innova-
tions could be made. Administrators might investigate
additional funding and resource acqui-
sition initiatives for talent recruitment. At the throughput phase,
institutions could analyze
the retention rate, quality, and competitiveness of their courses
and professors, as well as
how they match external market demand and nursing
requirements. At the output phase—
19. 1. Small number of external
elements, and elements are
simliar
2. Elements remain the same
or change slowly
Examples: Soft drink bottlers,
beer distributors,
container manufacturers,
food processors
Complex + Stable =
Low–Moderate Uncertainty
1. Large number of external
elements, and elements are
dissimilar
2. Elements remain the same
or change slowly
Examples: Universities,
appliance manufacturers,
chemical companies,
insurance companies
Simple + Unstable
High–Moderate Uncertainty
1. Small number of external
elements, and elements are
simliar
2. Elements change frequently
and unpredictably
Examples: E-commerce,
fashion clothing,
20. music industry,
toy manufacturers
Complex + Unstable =
High Uncertainty
1. Large number of external
elements, and elements are
dissimilar
2. Elements change frequently
and unpredictably
Examples: Computer firms,
aerospace firms,
telecommunications
firms, airlines
Complex
Stable
ENVIRONMENTAL
CHANGE
ENVIRONMENTAL
COMPLEXITY
Unstable
Simple
Uncertainty
Section 2.2 Why Change? Identifying the Need to Change
Drees and Heugens (2013) conducted a meta-analysis of 175
21. studies regarding companies’
use of resource dependence tactics (including interlocks,
alliances, joint ventures, in-sourcing,
and mergers and acquisitions). They found a positive
association between environmental
interdependencies and companies’ use of resource dependence
tactics. Moreover, firms’ use of
such tactics was positively associated with organizational
performance (Davis & Cobb, 2010).
The environment-industry-organization contingency model
shown in Figure 2.2 can be
used to understand an organization’s existing environment and
to diagnose the direction in
which it might need to move to increase its performance.
Duncan’s model is a simple big
picture and straightforward way to map an organization’s fit
with environmental complexity.
Figure 2.2: Environment-industry-organization “fit”
How “fit” an organization is depends on the level of complexity
and the stability of the environment.
Source: Duncan, R. B. (1972). Characteristics of organizational
environments and perceived environmental uncertainty.
Administrative
Science Quarterly, 17(3), 313–327; Daft, R. (2010).
Organization theory and design (10th ed.). Mason, OH: South-
Western, Cengage
Learning, p. 157.
Simple + Stable =
Low Uncertainty
1. Small number of external
22. elements, and elements are
simliar
2. Elements remain the same
or change slowly
Examples: Soft drink bottlers,
beer distributors,
container manufacturers,
food processors
Complex + Stable =
Low–Moderate Uncertainty
1. Large number of external
elements, and elements are
dissimilar
2. Elements remain the same
or change slowly
Examples: Universities,
appliance manufacturers,
chemical companies,
insurance companies
Simple + Unstable
High–Moderate Uncertainty
1. Small number of external
elements, and elements are
simliar
2. Elements change frequently
and unpredictably
Examples: E-commerce,
fashion clothing,
music industry,
24. Section 2.2 Why Change? Identifying the Need to Change
The two dimensions of environments are shown as
environmental change (that is, stable or
unstable) and environmental complexity (that is, simple or
complex).
A simple–complex dimension of environmental uncertainty
indicates the number and dis-
similarity of external elements that affect an organization’s
functioning (Daft, 2015). The higher
the number of forces (such as inflation and changing client
demographics) and the greater the
number of dissimilar elements (such as different companies and
competitors), the greater the
environmental complexity. Such complex, unstable, and
therefore highly uncertain environ-
ments characterize companies in the aerospace,
telecommunications, airlines, and computer
industries. The following example from Zappos illustrates an
interpretive use of this model.
Referring to Figure 2.2, in which quadrant of the environment-
industry-organization model
does Zappos best fit? It is the number one online e-tail shoe and
clothing company. It has
chosen customer service, company culture, and employee
training and development as com-
petitive and distinctive competencies. In addition, it has a
superior supply chain, excellent
customer service, trained call center employees, a fast web
interface, and large online product
offering. Its culture emphasizes “Wow” (Zappos, n.d.) delivery
25. services, accepting and driving
change, creating fun and weirdness, being humble, and other
passionate elements.
The model suggests that the company may be in a simple +
unstable, high-moderate uncertainty
environment niche with other e-commerce, fashion clothing
industries. However, because Zappos
is also a technology company driving toward larger product
lines and customers, as well as faster
and higher sales and revenues, it seems Hsieh wanted to move
into a complex + unstable, high-
uncertainty environment. Toward which quadrant is he driving
his internal structure? Which
environmental niche would you recommend that he move in to
be successful over the long term?
We will now analyze two additional examples of organizations
facing major change using the
environment-industry-organization model.
Hewlett Packard
Why did HP recently need an organizational change? Facing a
highly uncertain environment,
HP CEO Meg Whitman (former eBay CEO) has been trying to
move HP back to its previous
position as a dominant global technology leader or face failing
market share, which could
ultimately result in the sale of the company. HP has been
undergoing a transformation under
Whitman’s leadership since 2011. She has laid off more than
55,000 employees and counting.
One problem has been the lack of a unifying vision for the
company, which is in a complex +
unstable, high-uncertainty environment, according to Figure
27. From an organizational change perspective, the question arises:
Has Whitman accurately
diagnosed HP’s situation regarding why it should change?
Universities
Figure 2.2 suggests that universities in general inhabit complex
but stable, or low-moderate
uncertainty environments. The environments in this quadrant
have traditionally had few ele-
ments that cause instability and change but several dissimilar
factors that create complexity.
For this reason, the question of Why Change is not relevant.
Could new competitive global and
domestic forces in the environment move some universities to a
more complex + unstable
industry fit? A number of forces suggest this may be the case.
For example, student debt is estimated at $1 trillion, rising
administrative and tuition costs
have not subsided, and since the downturn in the economy,
many companies have dropped
their tuition reimbursement programs, presenting additional
challenges for universities. Cut-
backs in budget-constrained state funding for public universities
add yet another dimension
of uncertainty. Some industries and companies have also
questioned the value of traditional
educational degrees, although data show that students with
certain higher educational
degrees earn more than those without them (Kurtzleben, 2014).
The environment was more stable for nonprofit traditional
colleges before competition from a
number of sources emerged, including free massive online open
curriculum courses and other
Internet-based institutes and programs. For-profit universities
28. like the University of Phoenix
also provided a market jolt. Though not all nonprofit colleges
were threatened by the for-profit
universities, these new market entrants introduced innovative
and convenient educational
opportunities, especially for students who could not or did not
wish to attend traditional classes.
Even Harvard and Massachusetts Institute of Technology (MIT)
started programs for the masses
using online courses and programs.
Larger environmental threats to con-
temporary universities will not subside
in the near future because of the mar-
ket forces identified, including a lack
of donor loyalty in giving to many uni-
versities (Giménez, Martín- Retortillo, &
Pires de Carvalho, 2010). Each college
will have to determine which quadrant
in Figure 2.2 it is currently positioned in
and if it should strategically migrate to
another to remain viable and competi-
tive. Simply stated, creating stable orga-
nizations to perform in an environment
of complex and fast-moving change can
be disastrous. Since the main motiva-
tors of organizational effectiveness are
Dan Whobrey/iStock/Thinkstock
Traditional brick-and-mortar universities are
evolving their course offerings and processes
due to changes brought about by the increasing
prominence of online institutions, such as the
University of Phoenix.
30. o
f
o
rg
an
iz
at
io
n
Mature
2. Grow with:
clear direction
3. Grow with:
delegation
4. Grow with:
coordination
5. Grow with:
collaboration,
innovation1. Grow with:
creativity
Entrepreneurial
Stage: 1
Collectivity
Stage: 2
31. Formalization
Stage: 3
Elaboration
Stage: 4
Revitalization or Decline
Stage: 5
Section 2.2 Why Change? Identifying the Need to Change
dynamic, the elements and process of strategy and organization
must be as well (Lawler
& Worley, 2006). Both private and nonprofit universities will
change more now than in the
past as environmental forces shift and competitive pressures
mount (Carey, 2015).
The Organizational Life-Cycle Model
Another model that addresses the Why of change is Greiner’s
(1972, 1998) organizational
life-cycle approach, which remains a classic and highly used
road map for diagnosing the
types of crises and challenges organizations face as they age.
Relevant to the open-systems
and environment-industry-organization approaches, the
organizational life-cycle model adds
a historical dimension to understanding an organization’s
developmental needs in terms of
deciding why it may need to change, especially in regard to
capabilities required of leaders to
grow organizations along their life cycle.
As organizations evolve and follow a somewhat predictable
32. path, they move through punctu-
ated equilibrium—periods of stability with embedded crises. If
these predicted crises are not
solved, leadership and management can be forced out of
business and replaced by a team that
can bring in the needed changes (True, Jones, & Baumgartner,
2006).
Figure 2.3 illustrates the five phases of growth: creativity, clear
direction, delegation, coordi-
nation, and collaboration. Each period is characterized by a
leadership style used to realize
growth that is appropriate for that particular phase. Each stage
is also characterized by a crisis
Figure 2.3: The developmental life-cycle of organizations
The organizational life-cycle model provides understanding of
an organization’s needs based on its
history, present capabilities, and potential. It consists of five
stages, with a crisis in each stage, followed
by a period of growth.
Source: Adapted from Greiner, L. (1972, July–August).
Evolution and revolution as organizations grow. Harvard
Business Review, 50, 37–46;
and Quinn, R. E., & Cameron, K. S. (1983). Organizational life
cycles and shifting criteria of effectiveness. Management
Science, 29, 33–51.
Large
Small
Young
35. Section 2.2 Why Change? Identifying the Need to Change
that must be solved before growth can occur. The pattern
presented in Figure 2.3 is assumed
for organizations in industries with moderate growth over a long
term. Greiner (1998) stated
that companies in fast-growing industries may experience all
five phases more rapidly, and
organizations in slow-growing industries may experience only
two or three phases over sev-
eral years.
As you look at Figure 2.3, notice that each stage has extended
periods of growth without a sig-
nificant change to the organization’s practices. Then a
revolutionary phase occurs, denoting
periods of extensive disturbance. Greiner (1972) originally
hypothesized that the length of
time in each phase of an organization’s life cycle varies by
industry, company, and the chang-
ing environment. He also proposed that an organizational crisis
could occur at the end of each
growth stage and that the organization’s ability to manage and
solve these crises will deter-
mine its survival (Simmons, 2005).
This theory also assumes that each stage is both a result of the
previous phase and
cause for the next phase. In stage 2 the organization grows
under leadership with
clear direction—solving the previous crisis of leadership
needed. However, over time,
leadership with clear direction leads to a crisis of control, and
36. then a leadership style that
emphasizes coordination and delegation is needed. Examine
Table 2.1 to understand the
organizational characteristics and requirements of each stage,
not only in terms of
leadership style, but also with regard to structure, systems,
strengths, weaknesses, and
crisis points.
Greiner (1998) hypothesized that during each period, leaders
and managers are limited in
what they are able to do for growth to occur. For example, a
company experiencing a crisis of
control in stage 3 cannot return to offer clear directive
management for a solution; the leader
must adopt a new style of delegation in order to move to the
next stage of development and
growth.
Empirical research on substantiating effectiveness criteria in
life-cycle theories of organiza-
tions is mixed. Quinn and Cameron (1983) found support for
one version of the theory but
also noted that the predictions in these theories are often not
substantiated in research, since
organizational responses to the external environment differ
across the stages of the life cycle.
As you read about each stage, you will be able to see how these
responses would differ across
the life cycle and among companies.
Refer to Table 2.1 as you read through each stage. Although its
elements are explained in the
text, there are descriptions in this table that reinforce the
characterization and meaning of
each stage of the model.
72. the existing leadership does not or cannot assume new
responsibilities of organizing, then a
more sophisticated, formalized leadership style must be brought
in for growth to continue.
Stage 2: Growth Through Direction
Stage 2, growth through direction, occurs under more structured
leadership and manage-
ment styles. A functional organizational structure is adopted;
that is, a basic arrangement of
departments where sales and marketing, manufacturing,
production, finance, and research
and development are formed with expertise in each area.
Specialized jobs are assigned.
Systems are put into place, such as accounting, human
resources, inventory, shipping, and so
on. Budgets, pay systems, and working rules are also
established. A more structured culture
evolves where communication is formal and impersonal, titles
and positions are developed,
and managers assume more authority, with strategic decision
making generally occurring at
the top level.
The second crisis and possible revolution Greiner (1998) notes
evolves from a crisis of
autonomy. The new directive styles work to spur growth but
then become too constraining
to integrate and control the organizational diversity and
complexity that evolve. A central-
ized hierarchy constrains and confines employees who know and
have learned more about
markets and customers than their leaders and managers.
Employees are conflicted between
following meaningless procedures and taking action themselves.
74. top down and also decentralized, and managers are able to move
into larger markets faster
and begin innovating.
Crisis and possible revolution occur at this stage if leadership
and management try to take
control of the entire organization and return to a centralized
system of decision making, com-
munication, and ways of managing. Greiner (1998) argued that
this revolution would fail
because of the organization’s expanded operations and its
ability to find new solutions in
special coordination techniques.
Stage 4: Growth Through Coordination
Stage 4, growth through coordination, occurs when formal
systems are used to achieve
greater coordination by more efficiently allocating corporate
and local resources. As Greiner
(1998) noted:
Decentralized units are merged into product groups. Formal
planning pro-
cedures are established and intensively reviewed. Numerous
staff members
are hired and located at headquarters to initiate companywide
programs
of control and review for line managers. Capital expenditures
are carefully
weighed and parceled out across the organization. Each product
group
is treated as an investment center where return on invested
capital is an
important criterion used in allocating funds. Certain technical
functions,
such as data processing, are centralized at headquarters, while
75. daily operat-
ing decisions remain decentralized. Stock options and
companywide profit
sharing are used to encourage employees to identify with the
organization
as a whole. (p. 62)
The crisis occurs over the accumulation of red tape. Systems
and programs exceed their use-
fulness. A lack of confidence and resentment grows between
line and staff (“line” are profes-
sionals in an organization’s departments that are revenue
generators, such as manufacturing
and selling; “staff” are in organizational support departments
that are revenue consumer,
such as human resources and accounting), headquarters and the
field, and different groups
of employees, usually over bureaucratic procedures. In addition,
there is a lack of innovation
and a rigidity in obtaining information, making decisions, and
completing work.
Stage 5: Growth Through Collaboration and Innovation
Stage 5, growth through collaboration and innovation, occurs as
a result of and a reaction to
stage 4. This stage endorses interpersonal collaboration,
flexibility, and behavioral leader-
ship and management styles. Whereas the previous stage
emphasizes formal systems and
procedures, this stage promotes spontaneity through teams and
meaningful confrontation
over interpersonal differences. Red tape and formal controls are
replaced by self-discipline
and social control.
This stage is accomplished through quick problem solving by
77. example of this model.
Steve Jobs and Apple
Steve Jobs passed away from cancer in October 2011, but his
legacy continues in the brand
he created. Tim Cook, appointed by Jobs, assumed leadership of
the company that year.
The relationship between Jobs and Apple exemplifies the
dynamics of the organizational
life-cycle model. Few, if any, CEOs have successfully
reinvented themselves as many times
as Jobs did at Apple. It may be more accurate to say that few
CEOs have reinvented a com-
pany like Apple over its life cycle as did
Jobs. Although there are no definitive dates
that characterize Apple’s organizational
life cycle, the following grouping of stages
(based on and reconstructed from Geek,
2010; Linzmayer, 2006; Young & Smith,
2005) is an approximation designed to
discuss and illustrate Greiner’s (1972,
1998) framework.
Apple Computer’s entrepreneurial stage
(stage 1), based on the logic of the organiza-
tional life-cycle model, started before 1976
but lifted off April 1, 1976, when Jobs and
Steve Wozniak launched their company. The
Apple I computer sold for $666.66. In 1977
the Apple II was introduced as the first per-
sonal computer; it came in a plastic case and
featured color graphics. In 1980 Apple went
public, selling 4.6 million shares priced at
$22 each. It was an exciting and challenging
time for the technically oriented Wozniak
and the intellectually shrewd Jobs. Neither
79. (former president of PepsiCo),
who, as an older, experienced corporate ex-president, brought a
sense of direction and order.
There was a definitive crisis of leadership during this time.
Wozniak left that same year, and
Jobs started NeXT Inc., another computer firm.
The formalization stage (stage 3) began and lasted during the
years that Sculley, followed
by CEOs Michael Spindler (1993–1996; former chief financial
officer [CFO] of Apple) and
Gil Amelio (1996–1997) took unsuccessful turns at leading the
company. Although they
each tried to manage and innovate while formalizing systems
and bringing order to Apple,
product innovation and quality suffered during this period. The
bureaucratization, control,
and lack of coherent delegation came to an end after Sculley’s
last successor, Markkula, was
let go.
Jobs returned in 1997 as interim CEO, which marked the
beginning of the elaboration period
(stage 4). It is reported that very shortly after Jobs walked back
into the Apple offices he was
fired from 12 years earlier,
wearing shorts, sneakers, and a few days’ growth of beard, he
sat down
in a swivel chair and spun slowly.… “Ok, tell me what’s wrong
with this
place?” … Executives began offering some answers. Jobs cut
them off. “The
products SUCK!” he roared. “There’s no sex in them anymore!”
(Burrows &
Grover, 2006, para. 2)
80. He returned to Apple and stayed until the day he retired, in
August 2011. His product inno-
vations and the company he built (which some describe as a mix
between GE and Disney)
during this time remain legendary. In 2001 the iPod, a palm-
sized, hard drive–based digi-
tal music player, was introduced. In 2003 the iTunes Music
Store, which sold music, audio
books, and movies for Internet download, was launched. In 2005
the iPod that played video
was introduced. During that year Jobs also announced that
Apple computers would use rival
Intel Corporation’s microprocessors. During 2006 Apple started
selling Macs that ran on
Intel chips, and in 2007 the iPhone and iPod Touch were
announced. In 2008 the App Store—
an update to iTunes—was added to Jobs’s list of innovations,
and in 2009 Apple released the
iPhone 3GS, which was later followed by the 4G version. Jobs
brought the iPad to market in
2010, a tablet computer with an Apple homemade processor.
The global popularity of these
products and innovations speaks directly to the success of
Jobs’s decision making in revital-
izing Apple.
Greiner (1972) placed a question mark after the elaboration
stage in his original organi-
zational life-cycle model, which indicated that an organization
can either be revitalized to
grow and prosper or it can decline. Jobs’s successor, Cook, has
proved that he can and is
revitalizing Apple, with introductions of new iPhone models
along with the Apple Watch. In
April 2015 Apple became the first company in U.S. history to
82. Major reasons for failure or significant setback included lack of
scale (inability to achieve a
level of business activity to sustain a business model), unclear
value proposition (the product
did not compel customers to become repeat users), insufficient
funding, lack of and shift in
product focus and target market, regulation and government
issues, lack of market readiness,
lack of trust and engagement with their customer community,
invalidated product offering
(lacking a sufficient market for the product), and competition.
Referring back to Greiner’s (1972, 1998) organizational life-
cycle model, we may assume that
not only did the collaborative company start-ups fail from a
potential crisis in leadership in
the first stage, but their founders and teams made other mistakes
as well. For example, start-
up founders and leaders may misread or overlook the need for
their product or service at
the input phase of the open-system model. They may also
misjudge the effects that environ-
mental forces can have on their start-ups: namely, regulation,
customer demand, and suf-
ficient resources (funding). Moreover, not having a clear vision
and business model is also a
detriment.
All of these issues may arise during the first phase of a start-
up’s existence. Perhaps these fail-
ings also contribute to the fact that more than 100,000 U.S.
nonprofit groups will fail by 2017.
Even a few large recognizable nonprofits that succeed do not
account for large numbers in
this area, despite about 1.4 million nonprofit organizations that
are registered with the Inter-
84. Culture
• Fit with environment
• Internal alignment
• Adjustment/Change
Structure
• Enterprise
• Functional
• Business process
• Global/International
People
• Individual(s)
• Group/Team
• External stakeholders
Systems
• Human Resources
• Financial/Accounting
• IT
Presenting Issues:
Strategic, Tactical, Structural, Technological, Human,
Legal, Values/Ethics, Political Markets, Competitiveness,
Products/Services Effectiveness, Efficiency,
Performance, Growth, Morale
Type of Change
• Transformational
• Transitional
• Developmental
Level of Intervention
85. Organizational
Team/Group
Individual
Section 2.3 Diagnosing What to Change
2.3 Diagnosing What to Change
After identifying why change is needed within an organization,
the questions turn to what,
who, and what type of change is needed? In the previous
section, we discussed models for
diagnosing and assessing an organization’s present state, and
where it “is” in its present state.
Now we will turn our attention to diagnosing what needs to be
changed.
Assessment Model: Determining What Changes to Make
Figure 2.4 shows three types of changes available to an
organization, as well as levels of inter-
vention, issues, and opportunities that trigger a change. Note
that although this figure appears
sequential on paper, the connecting arrows between the
dimensions are multidirectional.
Identifying what to change within an organization is not a
mechanistic process but a messy,
sometimes political, argumentative, but (hopefully) creative and
productive one, so long as it
is tempered by sound judgment.
Figure 2.4: Diagnostic change issues, opportunities, and
interventions
When matching types of change interventions to organizational
needs and issues, it is important to ask,
“What types of changes are needed to produce optimal results in
86. an organization’s internal systems?”
Source: Adapted from Cummings, T. G., & Worley, C. G.
(2015). Organization development & change (10th ed.).
Stamford, CT: Cengage
Learning, Chapter 5.
Leadership
• Effectiveness
• Style
• Succession
Strategy
• Global-International
• Corporate
• Business/Functional
• Marketing, IT, Financial
Culture
• Fit with environment
• Internal alignment
• Adjustment/Change
Structure
• Enterprise
• Functional
• Business process
• Global/International
People
• Individual(s)
• Group/Team
• External stakeholders
Systems
• Human Resources
88. changes are incremental, small-scale, fine-tuning, and
developmental. These changes involve
adjustments to systems, processes, and structures rather than
fundamental or radical changes
to strategy, core values, or identity (Newman, 2002). Examples
include installing a new soft-
ware application in a department, revising procedures for a
purchasing system, and revising a
training system for business users on a new IT system. The
level of intervention in Figure 2.4
may be departmental, divisional, by team, by group, or by
number of individuals.
Second-order (discontinuous) changes are radical,
transformational, and sometimes tran-
sitional in nature and involve the entire organization or
different units (Bate, 1994). Such
changes are also called “frame bending” and may be done with a
big bang, as illustrated ear-
lier by HP’s move to divide the company into two separate
entities.
Many change management texts focus on transformational rather
than transitional and devel-
opmental changes. Frohman (1997), however, argued that small-
scale organizational changes
that involve personal initiatives deserve more attention.
Frohman emphasized the importance
of people to organizations, especially people who initiate and
bring about local organizational
changes by exceeding their job responsibilities, striving to make
a difference, being action
oriented, and focusing on results. These people are known by
staff members in their organi-
zation but are less recognized by managers and higher-ups
(Palmer, Dunford, & Akin, 2009).
89. Individuals may trigger the need for a radical change, as was
shown by Mohamed Bouazizi, a
26-year-old Tunisian street vendor who in 2011 took his life by
burning himself in protest of
a stodgy government bureaucracy that negatively affected his
livelihood (Fahim, 2011; Ryan,
2011). The incident set off the Arab Spring, a wave of
demonstrations, protests, and riots that
ushered in frame bending changes in the Tunisian government
and across the Middle East.
However, although individuals like Bouazizi can be catalysts
for change, it is still institutions
and organizations—in this example, governments, military, and
legislatures—that must fol-
low through to implement and institutionalize changes.
There are three levels of intervention—that is, planned actions
to enhance an organization’s
effectiveness that focus on the organization, group, or
individual, shown in Figure 2.4. This
is an important decision that could be wasteful and costly if
misjudged. Zappos CEO Hsieh
decided to make a complete structural and systems change by
removing most of the formal
management positions. This change decision was made by the
leader, Hsieh himself, with the
assumed intent of keeping a dynamic culture alive among
employees, their peers, and groups
in order to drive the hypercompetitive growth strategy of
staying close to customers.
Presenting issues are problems and opportunities that are
believed, perceived, and/or
argued to be of primary importance for requiring a planned
change. Several classifications of
91. many of these large enterprise trans-
formations are successful? As indicated earlier, 1 out of 3
transformations succeeds (Aiken &
Keller, 2009; James, 2012). Although there is an abundance of
theories, anecdotal conjecture, as
well as some substantial evidence to explain this failure rate, it
can be argued that the presenting
issues of leaders whose rationales are not supported by evidence
may also be a contributing fac-
tor. Again, taking a big-picture systems view of planned
organizational change requires system-
atically diagnosing the why, what, who, and how of presenting
problems and desired
opportunities.
Diagnostic Trigger
Questions: Identifying the
Level(s) of Intervention
Internal change teams and change spe-
cialists can use trigger questions to
pinpoint specific change targets and
interrelationships with and between
leadership, strategy, structure, culture,
people, and systems. The questions
shown in Figure 2.5 are simple and
straightforward. They serve as a first
step for further investigation, planning,
and decision making to identify what
and who to change. In conjunction with
the previous diagnostic approach, Fig-
ure 2.5 provides a simplified view of
what needs to change.
For example, Atlassian, an Australian
software company founded in 2002
92. with more than 1,100 employees, was
organized into teams. Using a “best
HR practices” performance review,
employees reviewed their own and
peers’ performance twice a year using a
five-point scale in a 360-degree perfor-
mance review—similar to Google’s and
Salesforce’s. This system determined
employee bonuses (Luijke, 2011). The
Individual(s)?
Competency?
Leadership?
Group/Team?
Intergroup?
Development?
Competitiveness?
Performance?
Entire system?
System and
environment?
Satisfaction?
Trigger Questions
Where’s the pain (tension) in the system?
How related is the subsystem experiencing the problem with
other
93. parts of the organization?
How high up and how far down the organization does the pain
exist?
Who (which system) is ready for change?
Locus of the Problem: Where to Start?
Figure 2.5: The focus of organizational change
These questions help identify and diagnose who and what
part of an organization needs to change, and why.
Source: Adapted from Cohen, A., Fink, S., Gadon, H., &
Willits, R., with Josefowitz,
N. (1992). Behavior in organizations (5th ed.). Boston: Irwin,
pp. 424–426.
Individual(s)?
Competency?
Leadership?
Group/Team?
Intergroup?
Development?
Competitiveness?
Performance?
Entire system?
System and
environment?
95. the reviews worked. The VP and his team talked with other tech
companies about their
experiences. They found nothing on the market, including HR
approaches, that matched
what they wanted.
They therefore created their own more lightweight performance
review that included coach-
ing and focused on employees’ strengths and spending time on
what they love to do. The
new system also centered on motivation and recognition,
including a “kudos model” in which
coworkers can recognize great performance among each other
without a manager’s approval.
The new performance system was implemented. The result?
Seventy-five percent of staff who
showed outstanding performance were recognized by peers.
Independent, internal staff sur-
veys showed that 87% received extraordinarily high engagement
scores. The company has
been on a number of best employer lists and was named a best
U.S. medium-sized company
to work for.
Check Your Understanding
1. Frohman (1997) argued that small-scale organizational
changes that involve personal
initiatives deserve more attention than transformational
changes. Do you agree or disagree?
Explain your reasoning.
2. Consider an organization you have worked for in the past.
Describe a change this company may
have needed based on your answers to each trigger question.
97. Section 2.4 How to Change Transformationally Using the
Appreciative Inquiry Approach
thinking (philosophies) that serve different purposes at different
times. One approach does
not replace the other, nor is one approach superior.
The eight-step approach and the AI approach are the two most
popularly used multistep road
maps (by all types of organizations). These approaches include
leadership, a shared need,
guidance, commitment, communication, empowerment, and
ensuring that changes stick
(Gilley, Gilley, & McMillan, 2009). Both approaches have been
used for transitional changes
that involve organizational divisions, departments, and business
units of organizations.
Examples of programs that result from transformational
planning processes include merg-
ers and acquisitions, restructuring, new leadership and
management, cultural change, and
crises requiring complete organizational turnarounds. Kotter’s
model is more of a tradi-
tional, top-down problem solving and opportunity-producing
corporate process that has
become a classic standard for corporate change planning. The
AI approach centers on bot-
tom-up opportunity-generating processes to identify the What
and How elements of orga-
nizational change.
Unlike traditional problem-solving
approaches, AI engages employees
across the organization in creat-
98. ing positive change that focuses on
learning from success (Cooperrider,
Whitney, & Stavros, 2003). As defined
by Cooperrider and Whitney (1999),
AI leads to discovering the best of
what exists—such as the best in peo-
ple, organizations, and the surround-
ing world. It means asking questions
and searching for what gives an effec-
tive and capable system “life” so as to
increase its positive potential.
AI is commonly used in all types of
organizations—profit, not-for-profit,
governments, educational institutions,
hospitals, and large private and pub-
licly traded corporations around the world. It starts by asking,
“What is possible? What do we
wish to achieve?” The approach applies at any level: individual,
group, department, division,
or for the entire organization. At the organizational level, AI
begins by involving a large group
of individuals that includes leaders, employees, and members
external to the organization (for
example, customers, partners, suppliers), then moves across
groups with designated individu-
als in each group, recording main insights to be combined and
analyzed. Figure 2.6 depicts the
overall model. The process is explained from each of the four
phases, or the four Ds: discovery,
dream, design, and delivery.
We will discuss the methods involved in each phase first before
reviewing the approach in
theory and practice.
101. not replace the other, nor is one approach superior.
The eight-step approach and the AI approach are the two most
popularly used multistep road
maps (by all types of organizations). These approaches include
leadership, a shared need,
guidance, commitment, communication, empowerment, and
ensuring that changes stick
(Gilley, Gilley, & McMillan, 2009). Both approaches have been
used for transitional changes
that involve organizational divisions, departments, and business
units of organizations.
Examples of programs that result from transformational
planning processes include merg-
ers and acquisitions, restructuring, new leadership and
management, cultural change, and
crises requiring complete organizational turnarounds. Kotter’s
model is more of a tradi-
tional, top-down problem solving and opportunity-producing
corporate process that has
become a classic standard for corporate change planning. The
AI approach centers on bot-
tom-up opportunity-generating processes to identify the What
and How elements of orga-
nizational change.
Unlike traditional problem-solving
approaches, AI engages employees
across the organization in creat-
ing positive change that focuses on
learning from success (Cooperrider,
Whitney, & Stavros, 2003). As defined
by Cooperrider and Whitney (1999),
AI leads to discovering the best of
what exists—such as the best in peo-
102. ple, organizations, and the surround-
ing world. It means asking questions
and searching for what gives an effec-
tive and capable system “life” so as to
increase its positive potential.
AI is commonly used in all types of
organizations—profit, not-for-profit,
governments, educational institutions,
hospitals, and large private and pub-
licly traded corporations around the world. It starts by asking,
“What is possible? What do we
wish to achieve?” The approach applies at any level: individual,
group, department, division,
or for the entire organization. At the organizational level, AI
begins by involving a large group
of individuals that includes leaders, employees, and members
external to the organization (for
example, customers, partners, suppliers), then moves across
groups with designated individu-
als in each group, recording main insights to be combined and
analyzed. Figure 2.6 depicts the
overall model. The process is explained from each of the four
phases, or the four Ds: discovery,
dream, design, and delivery.
We will discuss the methods involved in each phase first before
reviewing the approach in
theory and practice.
kaspiic/iStock/Thinkstock
The AI method involves engaging employees from
the bottom up and asking questions to diagnose and
plan for change.
105. Section 2.4 How to Change Transformationally Using the
Appreciative Inquiry Approach
and reflections collected during the interviews. The intent
during this phase is to energize the
participants and their insights through a mutually shared
learning process. Possibilities and
new ideas emerge about the topic as participants are encouraged
to dream big.
Design Phase
During the design phase, each individual and the group as a
whole begins to design an organi-
zation to enact positive change. The design phase involves
creating a provocative proposition,
which bridges the best of “what is” in the organization’s present
state toward a speculative
“what might be” future state. This idea is provocative in the
sense that it extends beyond the
current status quo by challenging common assumptions or
routines and suggests a realistic,
desirable future for the company and its employees
(Cooperrider, 2002).
This phase creates a platform for developing the idealized state
derived from the first two
phases of the process. Actual organizational dimensions are
discussed with concrete char-
acterizations in terms of the leadership, culture, strategy, shared
values, business practices,
social responsibility, competencies, stakeholder relations, and
desired results in financial,
diversity, or other areas (Stevenson, n.d.).
106. Destiny Phase
Finally, the destiny phase involves an invitation to action
inspired from the other phases. Dur-
ing this phase, groups publicly declare intended actions and ask
for support to consider next
steps. Self-selected groups are organized to move the
organization forward.
The AI Approach Put Into Practice
A case presented in the Harvard Management Update provides a
good representation of the
strengths of AI, as general manager John Cwiklik of the Santa
Ana Star Casino in Barnanillo, New
Mexico, used this approach to financially turn the entire
organization around. The establish-
ment opened in 1993 and had the largest market share in the
region until competition arrived.
Even with a $60 million facility expansion, the casino was
ranked in fourth place (Kinni, 2003).
Problems appeared in the form of poor customer service and a
lack of employee attention and
engagement with customers—few people smiled or talked.
Cwiklik stated that employees felt
that management did not care about them or wish to speak to
them (Kinni, 2003).
Cwiklik engaged the entire 820-member staff in an AI
consultation focused on delivering a superior
service experience to customers. However, when the casino was
pressured to lay off 250 employ-
ees in October 2002, many developed a mind-set that the AI
effort played an unexpectedly helpful
role. Cwiklik stated, “We had to do it to save the business but
we wanted to do it in an appreciative
108. national levels (Browne & Jain, 2002; Cooperrider, Whitney, &
Stavros, 2008; Kelm, 2005).
Still, some scholars argue for more empirical, longitudinal, and
comparative studies to address
such questions as: How long lasting are the effects of an AI
consultancy? Does this method fit
within a particular cultural or managerial orientation; that is,
could the failure of an AI project
be attributed to a certain consultative style, facilitator skills, or
cultural context? Also, under
what conditions would this method be considered an effective
change process (Bushe, 2010,
2011)? These unanswered questions are reasonable and can be
applied to any and all change
methods. In the meantime, AI remains a respected and major
change approach.
Check Your Understanding
1. Briefly summarize AI and explain the ways it differs from
Kotter’s approach to organizational
change.
2. If you were to help plan and implement a sizable
organizational change with a team, would you
prefer Kotter’s (eight-step) or Cooperrider’s (AI) approach?
Explain your reasons.
2.5 How to Change Using Action Research
The best change strategies and plans can be compromised if the
human factor is neglected.
Ultimately, regardless of what diagnostic model is employed or
what strategy for change is put
into place, it is people who directly enact the change, and it is
people who are directly affected.
Not to account for such a critical factor in all phases of the
110. Identify the problem or opportunity
Consult with OD/
Change Management Expert
Collect data
Formulate preliminary diagnosis
Present feedback to client
Jointly diagnose problem/opportunity/
findings with client
Plan action steps jointly
Implement
Collect data post implementation
Section 2.5 How to Change Using Action Research
Now that we have seen what can happen when the human factor
is ignored in a change strategy,
we turn to an action research model that presents a classic OD
process. This useful teaching and
learning method puts individuals in the driver’s seat if the
change management team asks them
to participate from the start. The action research model provides
a step-by-step approach for
identifying the problem or opportunity, researching and
diagnosing the targets for change, and
presenting the diagnosis in a plan to the client (a CEO, HR
111. executive, or change team). This is a
common process that can be used by an internal team,
consultant, or student intern working
with a change team.
The action research model, shown
in Figure 2.7, has been described
as the dominant methodological
logic and basis for planned change
(Cummings & Worley, 2015). It was
originally adapted to an applied OD
context by Frohman, Sashkin, and
Kavanagh (1976); Shein (2004);
and Cummings and Worley (2001).
This approach is designed to pro-
vide objective information and anal-
ysis that goes beyond the superfi-
cial level of presenting issues.
The model’s straightforward process
is presented from the perspective of
an external consultant. In practice,
the change specialists are consid-
ered “colearners” vis-à-vis the orga-
nizational members with whom
they are working. They are equal
partners in the process, so neither
party is dominant and tasks are
shared (Cummings & Worley, 2001).
Both bring different and important
expertise and perspectives.
The consultative, problem, and/or
opportunity search process shown
in Figure 2.7 illustrates how poten-
tial sources of organizational prob-
114. Goldsmith, 2000).
Consult With the Client—Initial Meeting
The initial consultation between the change consultant and the
client involves a mutual
assessment of purpose, roles, and relationships. The client is
generally interested in the con-
sultant’s experience, expertise, methods, and fees. The
consultant is likewise interested in the
client’s methods, as well as the organization’s culture and
goals.
Culture and other assumptions should be clarified, including
those of the consultant. For
example, in international settings it is important to understand
what roles, information, and
level of involvement lower and midlevel employees can play in
problem identification, diag-
nosis, and other phases of the process. In some countries (for
example, in Asia and the Middle
East), relationships and power are more hierarchical than they
are in the West. OD consul-
tants whose values, perceptions, and practices view employees
as partners and colearners in
certain international or even local cultures could encounter
problems.
Value differences can also vary in both international and
national cultural contexts. Some
consultants view their role as identifying and solving problems,
whereas top management
may disagree. What happens when a consultant discovers
systematic sexual harassment
while diagnosing an inventory system? This problem is reported
to management who
116. transactions), questionnaires and surveys, performance reports,
financial data, and other
information relevant to the consultant’s search plan.
This phase is usually an iterative process; that is, members of
the consulting team may return
for additional information to obtain a longitudinal set of
observations rather than one-shot
looks or interviews. Consultants may also interview customers,
vendors, suppliers, and other
external stakeholders relevant to the search.
At this stage, confidentiality and privacy (as well as other
ethical issues) must be strictly
clarified, agreed on, and observed. For instance, how will the
information be used? How
will it be interpreted, protected, and disseminated? Who can be
unintentionally hurt by this
information?
Some of the same cultural issues already discussed also apply
here. For example, Mack,
Woodsong, MacQueen, and Namey (2005) discuss ethical
guidelines for observing confiden-
tiality and privacy during this phase of data collection. They
state that consultants should
be unobtrusive and avoid disrupting normal activity, but they
should also be open, so that
individuals being observed and interacted with do not feel their
privacy is compromised.
Consultants’ manner is often dependent on the situation:
sometimes consultants should
announce who they are and what their purpose is, while other
times it may not be appropri-
ate to do so.
117. It is the OD consultant’s responsibility to protect the privacy
and integrity of all individuals
who participate in surveys, interviews, and discussions that
relate to the data collection pro-
cess. However, it is also the consultant’s responsibility to
provide truthful information and
results to the sponsor of the consultancy.
Make a Preliminary Diagnosis
This diagnosis follows data collection and interpretation. The
preliminary diagnosis is just
that—preliminary. Because the consultant is reporting the
findings and interpretation back
to the client, it is important to note that the diagnosis could
change as more information
is collected. Also, additional hypotheses and different views of
the problem or opportunity
may arise after initial data is collected. This raises the question
of whether the consultant
is simply a messenger who delivers what she or he is told, or is
a more active and inquiring
participant.
The consultant may have started with an initial request to find
data that confirms top man-
agement’s interpretation of a problem. However, he or she could
later discover information
that disproves management’s problem identification. This phase
should anticipate how to
present and discuss what happens if the consultant discovers
another, radically different set
of problems. In such a case, it is key to be honest and tactful.
Feedback serves two purposes:
to ensure the results are validly interpreted and to increase
ownership among the members