The Impact of Top Management Change: An OD Practitioner’s Perspective

1. The Impact of Top Management Change: An OD Practitioner’s Perspective In early 1990, a major steel manufacturing organization in the United States was experiencing high numbers of industrial accidents, low productivity and low quality of manufactured product at a particular plant. The General Manager of the facility, recognizing the necessity for system-wide change, engaged the help of a nationally known Organization Development (OD) consultant. A program of intervention using the Continuous Process Improvement model was implemented. However, over the 14 years of the program, several changes in top management took place……. 1. A high level of support from top management accompanied the implementation of the organization development project at the outset. Safety issues provided a set of shared concerns between management and union officials. The Consultant initiated collaborative group activities and team-building exercises before allowing the groups to identify problems and beginning to work on solutions. The project was recognized as a long-term commitment, and all stakeholders were involved from the beginning. 2. A system of rewards and consequences was designed cooperatively, monitoring procedures were established and “Two-Minute Huddles” were instituted. The Two-Minute Huddles were ad hoc meetings of the persons actually involved in the work to be done, and served the purpose of providing a framework from which management and floor personnel reviewed difficult or dangerous procedures prior to attempting them. The Huddles allowed members of the work group to anticipate dangers and difficulties, and establish contingencies and personnel roles in the event of emergencies. 3. The Consultant terminated his involvement with the Company in 1993, and the implementation of the Continuous Improvement Program was left in hands of management and union personnel. Joint Continuous Improvement Coordinators from both union and management ranks were established to communicate program activities, to monitor the on-going CI activities and to facilitate adjustments when the need emerged. 4. At implementation, the level of accidents began to drop quickly, productivity and product quality increased, and cooperation between management and union workers spilled over into other areas of operations within the plant. In 1995 and 1997, the plant had been designated by the home company as the “Best in America”, and had won industry-wide awards. 5. In 2001, the existing GM who had supported the continuing CI program was replaced by a new person with no commitment to the program. Rewards were omitted or delayed, CI coordinators were returned to the floor as workers, and resources were no longer made available to the program. Accident rates increased, productivity declined, and quality was reduced. 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 20012002 2003 2004 John Goodman* Jeff Minoski* Dennis Lowa* Bob Mason* From 1990 through the end of 2001, all three General Managers (Goodman, Minoski, and Lowa) had provided personal buy-in and organizational support to the Continuous Process Improvement program. At the time the consultant separated, the program was self-sustaining. Support from the top was allowed to fade during the Mason administration. Starting in 2001, accident rates climbed, production and quality declined, and interactions between management and union become more confrontational and less cooperative. * The names of the general managers are fictitious