Organizational Change Campbell and Bailyns Boston Office Case Study Sharon Hunt

Part I: Analysis of Case and Application of OD/C Theories

Field Theory and Group Dynamics The Campbell and Bailyn case takes place during a time of significant change in the financial world, especially within the investment industry. The trying economic times had created a different sort of demand in the market place that required the application of complicated debt instruments. Additionally, the shrinking of highprofile sales had influenced the organization to restructure the sales compensation in such a way that required sales teams to work more closely with product manager and research staff located in a different geographic area. The case details these actions, but it is important to remember that the catalyst for this new behavior was the changes in the environment. Here, we can see the application of Lewins Field Theory at work- the firm was in a state of quasi-equilibrium until forces in the environment (namely, the macro economic recession and mortgage crisis) created forces that altered that state. According to Lewin, changes in the environment (the field) result in changes in the behavior of the group within the field, and in this case the pressure was enough to warrant a re-organization of the firm in order to better contend with the changes in the environment. When analyzing the case through Lewins lens, it is also important to note the elements of group dynamics that are at play. The changes in the field subsequently led to a restructuring of the organization and a redefinition of tasks and the team began to take a different behavioral shape. Previously, the generalists had been satisfied with their work and had healthy relationships with their clients; but as changes in the field created changes in the workplace, the behavior of group members began to change. John Oates became distant and averse to his new, nonlocal team of product and research professionals, Callahan began displaying pessimism regarding general affairs, and Jen Ulin expressed satisfaction with the new world order. This disparate state of group opinions and behavior was detrimental to the effectiveness and formation of a high-performing team, but according to Lewin it would not be possible to change the behavior of the negative influencers in isolation rather, the forces surrounding the team would need to be affected and the team would need to traverse through the three-step-model as a unified whole. Without collective change, the temporary behavioral changes influenced by pep talks or other managerial pressures would ultimately be fruitless.

Open-Systems The environment as described in the case is one of significant difficulty, and members of the firm may well feel as though that they are in survivalist mode. Winston needs to be acutely aware of this, as such a prolonged state of existence can lead to defensive behavior, combative dynamics between groups, and rivalry within a group. There are several factors that are contributing to this state in the case; 1) the KAT team is getting backlash from clientele regarding the inefficiency of the new structure 2) calls are coming in that require a higher level of knowledge dexterity and a greater degree of risk should the wrong instrument or advice be utilized 3) salespeople are now being scrutinized by other functions as part of their performance management review. All of these elements can very quickly lead to a closed-system environment where the KAT team becomes unwilling to continuously learn from the rapidly changing economic environment and instead reinforces each others defensive behavior, creating an us and them mentality within the team. The threats to the team are such that the members have very little control over them, and all of the threats originate externally; factors which exacerbate the development of defensive and anti-learning behaviors. This could backfire in a number of ways; 1) the new compensation system could lead to inner warfare instead of the intended purpose of bridging the knowledge gap between sales and product 2) salespeople could become less connected with the personal needs of their clients, preferring instead to just get the job done without the element of customer service that was a prior differentiator 3) the Boston office could become increasingly siloed with unhealthy working relationships developing between the KAT team and the remaining specialists. Internal Fit and Nadlers Congruence Model Another very important theme concept that surfaces in a variety of forms in this case is that of fit. The field changes that took place, which influenced the work environment, have rendered several previously well-fit elements misaligned. Let us examine the most relevant fit segments of Nadlers congruence model independently; 1) Individual-Organization: the members of the KAT team are now viewing the organization through a very different lens than they did before the change. We can assume that the members of this team are type A, gregarious individuals who enjoy a high-income lifestyle and who are experts in relationship management. This assumption is valid because these are the personality and motivational characteristics that create excellent salespeople in the investment business. Now, in the new organization, the salespeoples individual needs to be self-managing and independent are impeded by the fact that they have to rely on their other team members to assist in the care of their customers. Additionally, the new compensation structure has created a dissonance between the individual salespersons goal to earn a high

commission and the organizations goal to create products that better serve the clients. On the surface, it would seem that these two goals are alignedthe better the product and the more expertise the salesperson has regarding the product, the more sales he should be able to make. However, when the compensation structure is abruptly changed to incorporate feedback from coworkers instead of being based solely on financial performance, the individual can feel that the organization is not supporting him in his goals. 2) Individual-Task: In the new world order at C&B, salespeople that had previously been generalists and functioned as singular and dedicated representatives of the firm for their clients, were now boxed into specialists roles. Part of why these people were such high performers was due to the fact that they were able to build relationships with their clients above and beyond the details of the job. This ensured loyal and lasting relationships, and it is in this arena that these particular salespeople were most suited. When they were forced into specialist roles, they lost their places as the only salesperson assigned to particular accounts, and so these relationships began to be diluted. Instead, they were required to sell and maintain accounts with only the merits of their investment acumen in a particular area of expertise. This suggests that the new roles these salespeople were in were no longer a great fit for them as individuals, as the job focus shifted from relationship to technical knowledge. 3) Task-Organization: At Campbell and Bailyn, the organizational changes and tasks changes go hand in hand. In order to better meet the changing needs of the firms clientele, generalists had to become specialists and so their task definition was radically altered. In order to help support this change, the KAT team was introduced and implemented. These two sides of the same coin were designed as a means to reinforce the other, and to create a social support system. However, because the individuals in the roles exhibit signs of task-mismatch, it is difficult to tell whether or not the task/organization relationship is effective. If Campbell and Bailyn, as a larger company, decided to implement the KAT organization across the company, it might experiment first to see if a team comprised of salespeople who had been specialists in the past might be better suited.

Part II: Action Research Implementation and Winstons Next Steps

1) Research and Data Gathering: In the case, Winston did perform a bit of research before approaching his team for a feedback and brainstorming session. However, this data was based solely on financial performance- Winston did not take the time to gather additional qualitative data that could have aided in the ideation process. Now, I would recommend that Winston go back and spend time understanding the personalities and social dynamics that makeup the office

environment. For example, he could issue personality tests to generalists and specialists alike to determine if there are thematic traits that permeate each employee group. In addition, he could ask a skilled, objective party (consultant or otherwise) to interview members of the team in order to discern pain points and uncover underlying issues that have arisen since the added pressure of the economic crisis. Armed with such insight, Winston would then be better equipped to utilize his workforce in such a way that would both address the needs of the market and take into account the individual needs of the employees. 2) Feedback: Winston did a good job in the case of taking the problem to his generalist team in a meeting designed for that purpose. However, he neglected to involve any other office members- most notably, the specialists. By not getting feedback from over half the office, Winston and his team did not have the opportunity to get valuable insight from people who were already operating in a job similar to the new one being designed. This insight may have brought to light the individual/task misalignment that was previously noted, as the specialists were familiar with both the personalities of the generalists and the nature of the job. They could have contributed to the discussion in such a way as to ideate a configuration that was more conducive to multi-dimensional needs. In this regard, I recommend that Winston take a step back and meet with the generalists and specialists independently to get feedback on the process change. Then, he should conduct an office wide meeting where he delivers key insights uncovered at the previous meetings to the greater team as a catalyst for constructive conversation. The greater team can then begin a brainstorming session to figure out some experimental processes- these ideas would not only incorporate the combined knowledge of the entire staff, but would also garner an element of buy-in from everyone instead of leaving a significant portion of the group completely out of the decision. 3) Diagnosis: Here, Winston also did a good job of ensuring that the diagnosis of the problem was collaborative. However, he did not go through a structured diagnostic model to ensure that important considerations were taking place. He showed the team quantitative evidence of recent poor performance, and this technique was likely well chosen for a team of professionals who are influenced by data as part of their day-to-day jobs. But Winston was lacking insightful qualitative data with personality descriptions and cultural norm information. Armed with the proper research, Winston could have gone much deeper into the stage of the ActionResearch model. Specifically, when the team thought of the KAT, it could have examined the proposed team with the following questions: A. Does the group have measurable goals? Is its purpose clearly defined and agreed upon by all members? B. Do the group members have the proper experience to be able to accomplish the explicit goals?

C. Is there a process to handle conflict that might arise as a result of the new team dynamic? Should this be informal or formalized? What types of conflict can we predict, and can we agree on some terms on how to objectively view and analyze such conflict? D. How will the group receive feedback? Will this be left up to the customers and the new performance management program? Or will the team be able to do periodic self-assessment and adjustment? If so, what should be the proper cadence and format for these assessments? E. What is the impact of the new tasks on other members of the KAT? Other members in the office? F. What potential downfalls can we see? Are there mechanisms in place that can help mitigate? G. Do we feel, as individuals, that we are well suited to complete the new job as it is being outlined? These questions are tough to answer- but now that the KAT has been in effect for some time, Winston might find it very helpful to run through a session designed to answer these questions. Recalibration based on the outcome might be necessary. Based upon the reading in the case, I would propose (if I were a member of the KAT), to keep the specialization on the team, but revert back to single-handled accounts. Meaning, only one member of the team would actually converse with a particular client, but if the client needs something that is outside his realm of specialization, he would consult with that specialist to determine the best course of action for the client. This would need some process analysis in order to be effective, but an experimental approach could be taken wherein the team opens itself up to adaptation based on the learning it gains in the new format. 4) Planning and Intervention: There was not much discussion regarding action planning in the case beyond after lengthy discussions with senior managers in New YorkWinston had introduced the Key Accounts Team. Although not stated in the case, it seems apparent that Winston used his clout and influence to garner buy-in from other management members for his idea. This did not necessarily follow any sort of OD/C recommended approach to this step. Some steps that Winston could take now in order to plan for the future of the KAT team are 1) Determine measurable goals for the team to achieve 2) Discuss tactics in order to reach those goals 3) implement regular inspection and feedback sessions from both the team and major clients. Encourage recalibration in order to foster an experimental environment instead of one where high-performance is the only option. Another element in the case that deserves further scrutiny by Winston is the new Performance Management system. Although this was not his idea, if he did his due diligence in data collection and observation, he would probably find that the new program was contributing to the KATs collective defensiveness and he might see it as a threat resulting in heightened closed-system thinking. Essentially, the company

took one of the jobs most convincing motivators (compensation) and turned from a completely self-propelled mechanism to one that was subject to the control of others. For a highly independent, self-motivated team such as the KAT, it is easy to see why this would not be well received. It is a viable threat that the relationship between this sales team and the product/research teams will begin to erode over time, ultimately working against the goal of the program (although the case said it has had moderate success so far). This business is built on relationships, and the KAT are relationship experts. It stands to reason, then, that a more appropriate way to elicit communication and collaboration between the sales team and other departments is to encourage relationship building between them. Granted- further analysis would be necessary to determine whether this is the right course of action for the product/research teams, but in taking the initiative to dig deeper, ideas would most likely begin to surface. From reading the case, I thought a potentially more feasible way for these teams to communicate would be to organize retreats- weekend, multi-departmental getaways that were half debriefing sessions and half relationship-building activities. By tapping into the natural tendencies and skill of the sales team, the company could begin to organically grow collaboration that happens willingly, without threats to one side and undue pressure on another to take on a managerial role.