Spring 2003

OBHRM 501: Human Behavior and Organizations

Class 10 (6/4/03)
Jane E. Dutton
University of Michigan Business School

Managing Your Way Toward Excellence Change: Part 1

Teaching Note – Prepared by Jason M. Kanov

University of Michigan

Goals of the class:

1) To develop an understanding of the realities of managing change in organizations
2) To develop an appreciation for the power of vision in enabling excellence and effecting
organizational change.

Videos and materials needed:

• Video – “The Best Boss in America” (Diane Sawyer interviews Cisco’s John Chambers;
available through ABC news)
• Video – Timberland CEO Jonathan Swartz speaks at the UM Business School (February
2002; not available)
• Charlotte Beers at Ogilvey-Mathers Worldwide (B) – enough copies for every student
• Video – Charlotte Beers at Ogilvy & Mather Worldwide (This video and the parts A and
B of the case are available on the internet at Harvard Business Online:
[Link]

Description and flow of the class:

Class 10 Managing your way

toward excellence Change
Change: Part 1
o What are the 3 most compelling
o Why is managing change key to enabling reasons you as a leader need to
excellence? understand how to manage change?
o The challenge of resistance to change
o The power of vision
n What is it?
n Why does it work?
n Challenges?
Break
o Charlotte Beers and Ogilvy & Mather

Slide 1 Slide 2
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Slide 1 This slide provides an overview for the flow of the class. Note that this is part 1
of a two-part lesson on managing change. Part 1 focuses on higher-level or
organizational-level change whereas part 2 is focused on change as an inner
journey within an individual. Parts 1 and 2 are complement each other in
developing an understanding of managing change as a key to enabling
excellence.

Slide 2 This slide is intended to initiate a discussion about why managing change is
important. The goal of this discussion is to use students’ initial thoughts about
change to show them that change is inevitable and that managing change is an
important part of doing business. Recording students’ comments during the
discussion on the board or the slide will help reveal these themes.

Discussion about slide 2 (7-10 minutes):

• Sample responses: Change is always unexpected; change is the only sure
thing in business; managers are still accountable for the bottom line in
the midst of change; people often have strong reactions to change yet
everyone reacts differently; the ability to change builds capabilities in
organizations and it provides a competitive advantage; individuals and
organizations are evaluated on their adaptability; one’s ability to manage
change determines whether you will be reactive or proactive in the face
of change

What are the most daunting

challenges in managing change? What is a vision?
o Strong mental picture of a desired
future state
o “An alluring ideal future that is
credible yet not immediately
attainable”

Slide 3 Slide 4

Slide 3 This slide continues the previous discussion by asking students to talk about the
challenges associated with managing change. Consider writing the students’
responses on the board or on slide 3.

Discussion about slide 3 (10 minutes):

• Sample responses: Doubters and derailers can stand in the way of
change or complicate the change process; political obstacles; change
moves people out of their comfort zone
• Exercise: A comment about change and comfort like the bolded one
above can be used as a transition to a quick exercise designed to give
students a first hand look at the discomfort associated with change. [The
purpose of this exercise is to evoke emotional responses in students by
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trying something new (i.e., introducing unexpected change). For this

exercise you will need to bring a small mirror to class.] Tell the class
that you are going to try an activity with them and then call on two or
three of them by name to come to the front of the room, look in a mirror,
and speak in baby talk for two minutes. This should take the class,
particularly the students that you singled out, by surprise. Wait for a few
seconds and then ask the class if anyone will do this. Whether or not you
get any volunteers, ask the class to share their initial reactions to what
just happened. Encourage them to talk about how they felt when faced
with the change.
o Sample responses: Nervous; resistant; scared; self-conscious;
self-doubt
o Additional thoughts: Explain to the class that feelings like these
are not conducive to excellence. Change (even the prospect of
change) creates conditions in which people are not likely to be at
their best, basically setting them up to fail.
• Resume the discussion about challenges in managing change.
o Sample responses: Change reduces people’s capacity to perform
while at the same time requiring them to perform at the same or
higher level; people often don’t believe that change is real
(flavor of the month)

Slide 4 The previous discussions are designed to set up the ideas that change is
inevitable, being able to manage changing is important, and managing change is
challenging. Comments about people not believing that change is real can serve
as a transition to the next few slides about vision. Often times change efforts are
not taken seriously because they lack vision or the vision that is driving them is
not communicated well to organizational members. Developing a clear and well-
articulated vision is an important part of managing change because it helps to
keep the ideas for change alive in the minds of organizational members
throughout the change process. Slide 4 offers two brief descriptions of what a
vision is.

Better visions…….
Kouzes and Posner How do visions work? (Daft &
Lengel)
o Are widely shared
o Connect people to a higher purpose
o Have ideality (optimistic image)
o Compass not a roadmap– a focus button
o Unique (one of a kind) o Pull people toward the future (away from
o Future orientation (destination) habit, history and constraint)
o Imagery (pictures of the future) o Tap latent potential by tapping into higher
self and subtle inner motivation
o Challenge– beckon toward greatness
o Built on hope and engage positive emotion
o Define the destination and the journey

Slide 5 Slide 6

Slide 5 This slide identifies some key features of effective visions taken from Kouzes
and Posner.* Real life examples are useful for helping students understand the
idea of a vision and it’s importance in organizations. One way of providing such
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examples is by using videos. The following video clips give students a look at
the visions of two highly successful CEOs of two positively deviant
organizations. The goals of these videos are as follows:
• To help students appreciate more concretely what a vision is by letting
them hear CEOs talk about their visions first hand.
• To allow students to think critically about why these visions are
effective.
• To encourage students to think about how visions work.

* Kouzes, Janes M. and Barry Z. Posner 1995 The Leadership Challenge

(San Francisco: Jossey-Ban Publishers).

Video – “The Best Boss in America” (10 minutes):

This is a clip of Diane Sawyer interviewing John Chambers (CEO of Cisco
Systems). The video focuses on Chambers’ vision for Cisco and it provides a
glimpse of how his vision plays out in Cisco’s organizational culture.

Here are some examples of guiding questions for students to keep in mind while
watching the video:
• What is John Chambers’ vision?
• What makes his vision effective?
• How does his vision fit with who he is as a person?

Discussion about John Chambers (10 minutes):

What did you notice about Chambers’ vision and leadership style while watching
the video? What stood out to you?
• Sample responses: He seems to be a very real person; he is down-to-
earth and humble; he always seems very excited; all of the executives
work in cubicles; he seems to be emotional, passionate, and caring in
what he does; he seems very upfront and honest—he didn’t hide
anything; he seems very able to connect interpersonally with others
Why are his vision and leadership style effective?
• Sample responses: They are consistent with his personality; he practices
what he preaches (e.g., he advocates equality throughout his organization
and he works in a cubicle just like everyone else); he is just as excited
when he talks about his vision as he is normally

Video – Jonathan Swartz (10 minutes):

This is a clip of Jonathan Swartz (CEO of Timberland) giving a talk at the
University of Michigan Business School in February 2002. In his speech, he
talks about what Timberland is as an organization and what his vision is for the
kind of organization it should become. [The purpose of this part of the class is to
provide students with a look at a leader with a positive and enabling vision.
Although this Swartz video is not available, the following summary may be
useful for helping you identify a comparable video to show to your class.]

Here are some examples of guiding questions for students to keep in mind while
watching the video:
• What is captivating about Swartz’s vision?
• How do visions work? How do they inspire?
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Discussion about Swartz (5 minutes):

What about Swartz’s vision struck you?
• Sample responses: He presented his vision as a challenge; he connected
his vision to a higher purpose; his vision extended beyond the boundaries
of his organization—he talked about a responsibility to the surrounding
social and physical environment; there was a strong connection between
his own personal values and his vision for his organization
• Additional thought: An important part of a vision is the articulation of
underlying values. These values may be existing organizational values
or they may be values that the organization is striving toward. Changing
organizational values through a vision is particularly challenging.

Slide 6 This slide summarizes information from the Daft and Lengel coursepack reading
about how visions work. Encourage the class to reflect on the previous
discussions about John Chambers and Jonathan Swartz as you briefly talk
through the bullet points on this slide. Consider asking the class for specific
examples of what Chambers and Swartz did or said that is consistent with the
ideas presented in this slide.

The main idea across these bullet points is that the most effective visions enable
and inspire people. In this way, developing and communicating a vision are keys
to managing change because visions help people embrace the idea of change and
they fuel people’s willingness to change. Recall that change can have deleterious
effects on individuals and organizations. Visions counteract these effects by
replenishing and enabling individual and organizational capacities.

Break (10 minutes)

No slide The second half of the class begins with the Charlotte Beers at Ogilvy & Mather
Worldwide (O&M) case (Harvard Business School, # 9-495-031). This case
shows how Beers’ vision played an integral role in a dramatic change effort at
O&M. [This case is included in the coursepack and students should have read it
before coming to class.]

Although this case illustrates the challenges associated with change and the
importance of vision in the change process, Beers and O&M stand in sharp
contrast to other organizations that have been analyzed in this course.
Organizations such as Southwest Airlines and Timberland are positively deviant
in terms of performance and employee well-being. While the O&M case is a
success story in terms of performance, positive organizational dynamics and
leadership practices such as those that foster empowerment, compassion, and
collaboration are not as apparent in this case as they are in other examples used
in this course.

In light of the fact that Beers is eventually successful in implementing change at

O&M, it is still fruitful to analyze this case to see if and how Beers’ vision
enabled employees and facilitated the change process. One of the core
assumptions in this course is that profitability should not be the only end that
organizations aim to reach. For example, organizations should also aim to
cultivate positive emotions in their members, instill a sense of challenge and
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purpose in their work, and create workplaces that are fun and energizing. Just as
there are multiple approaches to doing business that can lead to profitability,
there are also multiple approaches to achieving these other ends. In analyzing the
O&M case, one could ask the following questions:
• To what extent is O&M able to achieve these various ends (besides just
profitability)?
• What are the means by which Beers and the organization as a whole
achieve these ends? What did she do that enabled her employees?
• What could have been done differently to make the change process more
enabling? What effects might this have had on profitability?
• To what extent do the ends that are achieved seem sustainable?

Discussion of the O&M case (40 minutes):

The teaching note for this case (available through Harvard Business Online)
provides guidelines for analyzing and discussing this case.

The teaching note focuses on a discussion of Beers’ effectiveness as a leader in

improving the profitability of O&M. For the purposes of this class, it is also
important to focus on what Beers did that enabled (or disabled) organizational
members in the face of change.
• Sample responses for enabling: By imposing a matrix structure, she
required individuals to do more—this stretched people and strengthened
their individual capacities; she redesigned the reward systems within
O&M so that they would support her new vision and the structural
changes she was making
• Sample response for disabling: She discouraged collaboration; she made
it seem like she wanted to involve others in the change process but then
she ended up making a lot of the final decisions on her own; she was
very autocratic in her approach and that seems to have alienated people;
she did not do a good job of explaining her rationale for the changes she
was trying to make

Additional thoughts:
As the discussion progresses, pay particular attention to the students’ reactions to
the case and to Beers. This case is written as a successful case that others should
try to emulate. Do students agree that this is a successful case? Is Beers’
leadership style something that students would want to emulate? Would they
want to work for someone like her? How might students’ reactions to Beers have
been different if this case was used at the beginning of the semester?

Additional materials:
As the discussion starts to wind down, hand out part B of the case and give
students a few minutes to read it. Also consider showing students the video of
Beers in which she debriefs some of what happened in the case. Consider asking
some follow-up questions such as the following:
• What other things strike you about the case or about Beers?
• How did you feel when watching the video of Beers? How did your
feelings compare to what you felt while watching the videos of
Chambers and Swartz?
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• What do you reactions to these various leadership approaches tell you

about yourself and your values? What is your theory of practice? Is it
consistent with your values?
• Does the end justify the means? Does the fact that O&M experienced
financial success as a result of Beers’ efforts mean that her approach was
the best approach (or the only approach) for this situation?
• Does the fact that Beers’ approach worked mean that her way of doing
things is the right way or the best way? Are certain approaches (e.g.,
Chambers versus Beers) better than others?
• How should you decide what the “right” thing to do is? How do you do
what is right for the situation and right for you?
• Are particular approaches likely to lead to more sustainable outcomes
than others?

So what has happened to CB?

o B-case Take-aways
n Acquired big accounts (IBM, Kentucky Fried
Chicken) o Change means anticipating
n Sense of re-igniting energy and org as whole resistance– inevitable
n Made structural changes to facilitate brand
stewardship, aligned rewards o Change means using vision and
n Make red redder “Red for fuel, red for fury, red alignment of structures and systems
for urgency, red for passion” with the vision
o Stayed with Ogilvy & Mather until 1997 o The process of vision creation and
o Hired by Powell to enhance image of US change is time and emotion-
among Muslims 10/2001 - 3/2003 intensive,-- yet critical for strategic
(resigned)
success

Slide 7 Slide 8

Slide 7 This slide summarizes some of what happened to O&M and Beers since the time
that the case was written.

Slide 8 This slide summarizes some of the main ideas from this class.

Problems and Dilemmas:

1) Do certain industries or certain types of organizations call for more or less “niceness” in
the way they do business?
• Is a CEO like John Chambers a better fit in some contexts than in others? What
about Charlotte Beers?

2) There are not many well-documented examples of positively deviant organizations,

particularly those that exemplify the core ideas of this course in the face of change. How
do we teach about the enabling possibilities of change in the absence of such examples?