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ManagementSixteenthEditionChapter11ManagingHumanResourcesCopyright©2025,2021,2018PearsonEducation,Inc.AllRightsReservedLearningObjectives11.1Explaintheimportanceandprocessofmanaginghumanresources.11.2

Describetheexternalinfluencesthataffectthehumanresourcemanagementprocess.11.3Discussthetasksassociatedwithidentifyingandselectingcompetentemployees.11.4Explainhowcompaniesdevelopworkforcetalent.11.5Describestrategiesforretainingcompetent,high-performingemployees.WhyHumanResourceManagementIsImportantHumanresourcemanagement(HRM)canbeasignificantsourceofcompetitiveadvantage.HRMisanimportantpartoforganizationalstrategies.Thewayorganizationstreattheirpeoplecansignificantlyimpactperformance.TheHumanResourceManagementProcessToensureanorganizationhasqualifiedpeopletoperformallthework,specificHRMactivitiesneedtobedone.Exhibit11-1showstheeightactivitiesinthisprocessthataresplitintothreemajorgroups:EnsuringthatcompetentemployeesareidentifiedandselectedProvidingemployeeswithup-to-dateknowledgeandskillsEnsuringthattheorganizationretainscompetentandhigh-performingemployeesExhibit11-1HRMProcessExhibit11-1showstheeightstepsintheHRMprocess.ExternalFactorsThatAffecttheHumanResourceManagementProcessTheeconomy:lastingimpactoftheCOVID-19pandemic.Tightlabormarkingmakesitmoredifficulttorecruitandhirecompetentemployees.HRMprofessionalsmustadjustwagesandbenefitsdependingonthebusinesscycle.LawsandRulingsHRMpracticesaregovernedbyacountry’slaws,andnotfollowingthoselawscanbecostly.HRMlawsandregulationsclearlyaffectorganizationalpractices.Sexualharassment:“Unwelcomesexualadvances,requestsforsexualfavors,andotherverbalorphysicalconductofasexualnatureconstitutesexualharassmentwhenthisconductexplicitlyorimplicitlyaffectsanindividual’semployment,unreasonablyinterfereswithanindividual’sworkperformance,orcreatesanintimidating,hostileoroffensiveworkenvironment.”Exhibit11-2MajorHRMLaws—EqualEmploymentOpportunityandDiscriminationLaworRulingYearDescriptionEqualPayAct1963ProhibitspaydifferencesforequalworkbasedongenderCivilRightsAct,TitleVII1964(amended1972)Prohibitsdiscriminationbasedonrace,color,religion,nationalorigin,orgenderAgeDiscriminationinEmploymentAct1967(amended1978)Prohibitsdiscriminationagainstemployees40yearsandolderVocationalRehabilitationAct1973ProhibitsdiscriminationonthebasisofphysicalormentaldisabilitiesAmericanswithDisabilitiesAct1990Prohibitsdiscriminationagainstindividualswhohavedisabilitiesorchronicillnesses;alsorequiresreasonableaccommodationsfortheseindividualsExhibit11-2MajorHRMLaws—Compensation/BenefitsLaworRulingYearDescriptionWorkerAdjustmentandRetrainingNotificationAct1990Requiresemployerswithmorethan100employeestoprovide60days’noticebeforeamasslayofforfacilityclosingFamilyandMedicalLeaveAct1993Givesemployeesinorganizationswith50ormoreemployeesupto12weeksofunpaidleaveeachyearforfamilyormedicalreasonsHealthInsurancePortabilityandAccountabilityAct1996Permitsportabilityofemployees’insurancefromoneemployertoanotherLillyLedbetterFairPayAct2009Changesthestatuteoflimitationsonpaydiscriminationto180daysfromeachpaycheckPatientProtectionandAffordableCareAct2010HealthcarelegislationthatputsinplacecomprehensivehealthinsurancereformsExhibit11-2MajorHRMLaws—Health/SafetyLaworRulingYearDescriptionOccupationalSafetyandHealthAct(OSHA)1970EstablishesmandatorysafetyandhealthstandardsinorganizationsPrivacyAct1974GivesemployeesthelegalrighttoexaminepersonnelfilesandlettersofreferenceConsolidatedOmnibusReconciliationAct(COBRA)1985Requirescontinuedhealthcoveragefollowingtermination(paidbyemployee)DemographicsBy2040,overhalfoftheUSworkforcewillbeoverage40.Womenmakeupalmost47percentofthecollege-educatedworkforce.However,womenholdonly8.2percentofCEOpositions.Womenhold24

percentofotherexecutive-levelpositions.Whiletherearemorewomenatlower-levelmanagementpositions,theyareheldmostlybywhitewomen(32.6

percent),withLatinaandBlackwomenholding4.3

percenteach,andAsianwomenholdingjust2.7

percentofmanagerroles.SocialandCulturalFactorsCompaniesoperatewithinasociety,andsocietaltrendscanimpactacompany’shumanresourcemanagementpractices.Oneculturaltrendisthefocusonemployeewell-being.Thistrendiscausingmoreemployeestodemandwellnessprograms.Othertrendswillemergeovertimethatrequiremanagerstofocusonotherpriorities.LaborUnionsLaborunion:anorganizationthatrepresentsworkersandseekstoprotecttheirintereststhroughcollectivebargaining.UnionparticipationratesintheUnitedStatespeakedinthemid-1950s,whenapproximately35

percentofallwageandsalaryworkersbelongedtoaunion.Currentlyunionmembershiphasremainedaround11

percent.However,in2022theNationalLaborRelationsBoardrecordeda53-percentincreaseinunionelectionpetitions,signalingthatunionsaren’tgoingawayanytimesoon.HumanResourcePlanningHumanresourceplanning:ensuringthattheorganizationhastherightnumberandkindsofcapablepeopleintherightplacesandattherighttimesTwosteps:AssessingcurrenthumanresourcesMeetingfutureHRneedsCurrentAssessmentJobanalysis:anassessmentthatdefinesjobsandthebehaviorsnecessarytoperformthemJobdescription(positiondescription):awrittenstatementthatdescribesajobJobspecifications:awrittenstatementoftheminimumqualificationsapersonmustpossesstoperformagivenjobsuccessfullyMeetingFutureHRNeeds/IncreasedScrutinyinSelectionProcessFutureHRneedsaredeterminedbytheorganization’smission,goals,andstrategies.Companiesthatdonotcarefullyscrutinizethequalificationsorbackgroundsofemployeessurelyposerisksofincreasedliability,poorreputation,andlowerperformance.RecruitmentandDecruitmentRecruitment:locating,identifying,andattractingcapableapplicantsDecruitment:reducinganorganization’sworkforceExhibit11-3RecruitingSourcesSourceAdvantagesDisadvantagesInternetReacheslargenumbersofpeople;cangetimmediatefeedbackGeneratesmanyunqualifiedcandidatesEmployeereferralsKnowledgeabouttheorganizationprovidedbycurrentemployee;cangeneratestrongcandidatesbecauseagoodreferralreflectsontherecommenderMaynotincreasethediversityandmixofemployeesCompanywebsiteWidedistribution;canbetargetedtospecificgroupsGeneratesmanyunqualifiedcandidatesCollegerecruitingLargecentralizedbodyofcandidatesLimitedtoentry-levelpositionsProfessionalrecruitingorganizationsGoodknowledgeofindustrychallengesandrequirementsLittlecommitmenttospecificorganizationSocialmediaTakesadvantageofcurrentemployees’connections;particularlyeffectiveatrecruitingyoungercandidatesNotnearlyaseffectiveinreachingolderorseniorcandidatesExhibit11-4DecruitmentOptionsOptionDescriptionFiringPermanentinvoluntaryterminationLayoffsTemporaryinvoluntarytermination;maylastonlyafewdaysorextendtoyearsAttritionNotfillingopeningscreatedbyvoluntaryresignationsornormalretirementsTransfersMovingemployeeseitherlaterallyordownward;usuallydoesnotreducecostsbutcanreduceintraorganizationalsupply–demandimbalancesReducedworkweeksHavingemployeesworkfewerhoursperweek,sharejobs,orperformtheirjobsonapart-timebasisEarlyretirementsProvidingincentivestoolderandmoresenioremployeesforretiringbeforetheirnormalretirementdateJobsharingHavingemployeesshareonefull-timepositionSelectionSelection:screeningjobapplicantstoensurethatthemostappropriatecandidatesarehired.Selectioninvolvespredictingwhichapplicantswillbesuccessfulifhired.Selectionissuccessfulifyouselectajobapplicantwhoturnsouttobegoodemployee,orifyourejectonethatwillbeabademployee.Exhibit11-5SelectionDecisionOutcomesAsshowninExhibit11-5,anyselectiondecisioncanresultinfourpossibleoutcomes—twocorrectandtwoerrors.ValidityandReliabilityAvalidselectiondeviceischaracterizedbyaprovenrelationshipbetweentheselectiondeviceandsomerelevantcriterion.Areliableselectiondeviceindicatesthatitmeasuresthesamethingconsistently.Exhibit11-6SelectionToolsToolCharacteristicsApplicationformsAlmostuniversallyused

MostusefulforgatheringinformationCanpredictjobperformancebutnoteasytocreateonethatdoesWritten/onlinetestsMustbejob-relatedIncludeintelligence,aptitude,ability,personality,andinteresttestsArepopular(e.g.,personalitytests;aptitudetests)RelativelygoodpredictorforsupervisorypositionsPerformance-simulationtestsUseactualjobbehaviorsWorksampling—testapplicantsontasksassociatedwiththatjob;appropriateforroutineorstandardizedworkAssessmentcenter—simulatejobs;appropriateforevaluatingmanagerialpotentialInterviewsAlmostuniversallyusedMustknowwhatcanandcannotbeaskedCanbeusefulformanagerialpositionsBackgroundinvestigationsUsedforverifyingapplicationdata—valuablesourceofinformationUsedforverifyingreferencechecks—notavaluablesourceofinformationPhysicalexaminationsAreforjobsthathavecertainphysicalrequirementsMostlyusedforinsurancepurposesAssessinganApplicant’sFutureJobPerformanceWorksampletests:hands-onsimulationsofpartoralloftheworkthatworkersinajobroutinelymustperform.OneofthemostreliableandvalidtoolsforpredictingfutureperformanceMoreelaboratesimulationscanbedesignedandadministeredthroughanassessmentcentertodeterminemanagerialpotentialRealisticJobPreviewRealisticjobpreview(RJP):apreviewofajobthatprovidesbothpositiveandnegativeinformationaboutthejobandthecompanyTheevidenceindicatesthatapplicantswhoreceiveanRJPhavemorerealisticexpectationsaboutthejobsthey’llbeperformingandarebetterabletocopewiththefrustratingelementsthanapplicantswhoreceiveonlyinflatedinformationTechnologyintheHiringProcessArtificialintelligence:Fromwritingjobpostingstoscreeningapplicantrésuméstoanalyzingvideointerviews,AIissignificantlyimpactingthehiringprocess.AIisoftenusedtoscreenalargevolumeofrésumésortosearchfornicheskillset.Socialmedia:socialmediacanbeagoodsourcetorecruitcandidatesManybusinessestodayhiredigitalmarketingexpertstoutilizesocialmediaintherecruitmentprocess.OrientationOrientation:introducinganewemployeetohisorherjobandtheorganizationWorkunitorientation:familiarizesemployeeswiththegoaloftheworkunitandtheirspecificjobOrganizationorientation:informsemployeesaboutthecompany’sgoals,history,philosophy,procedures,andrulesExhibit11-7EntrySocializationOptions(1of2)Formalvs.InformalThemoreanewemployeeissegregatedfromtheongoingEntrySocializationOptionsworksettinganddifferentiatedinsomewaytomakeexplicithisorhernewcomer’srole,themoresocializationisformal.Specificorientationandtrainingprogramsareexamples.Informalsocializationputsnewemployeesdirectlyintothejob,withlittleornospecialattention.Individualvs.CollectiveNewmemberscanbesocializedindividually.Thisdescribeshowit’sdoneinmanyprofessionaloffices.Ortheycanbegroupedtogetherandprocessedthroughanidenticalsetofexperiences,asinmilitarybootcamp.Fixedvs.VariableThisreferstothetimescheduleinwhichnewcomersmakethetransitionfromoutsidertoinsider.Afixedscheduleestablishesstandardizedstagesoftransition.Thischaracterizesrotationaltrainingprogramswherenewhiresmightspendthreemonthsineachofhalf-dozendepartmentsbeforefinalassignment.Variableschedulesgivenoadvancenoticeoftheirtransitiontimetable.Thisdescribesthetypicalpromotionsystemwhereoneisn’tadvancedtothenextstageuntiloneis“ready.”Exhibit11-7EntrySocializationOptions(2of2)Serialvs.RandomSerialsocializationischaracterizedbytheuseofrolemodelswhotrainandencouragethenewcomer.Apprenticeshipandmentoringprogramsareexamples.Inrandomsocialization,rolemodelsaredeliberatelywithheld.Newemployeesareleftontheirowntofigurethingsout.Investiturevs.DivestitureInvestituresocializationassumesthatthenewcomer’squalitiesandqualificationsarethenecessaryingredientsforsuccess,sothesequalitiesandqualificationsareconfirmedandsupported.Divestituresocializationtriestostripawaycertaincharacteristicsoftherecruit.Fraternityandsorority“pledges”gothroughdivestitureritualstoshapethemintotheproperrole.Exhibit11-8TypesofTrainingExhibit11-8describesthemajortypesoftrainingthatorganizationsprovide.Exhibit11-9TraditionalTrainingMethodsMethodCharacteristicsOn-the-jobEmployeeslearnhowtodotaskssimplybyperformingthem,usuallyafteraninitialintroductiontothetask.JobrotationEmployeesworkatdifferentjobsinaparticulararea,gettingexposuretoavarietyoftasks.MentoringandcoachingEmployeesworkwithanexperiencedworkerwhoprovidesinformation,support,andencouragement;alsocalledapprenticeshipsincertainindustries.ExperientialexercisesEmployeesparticipateinrole-playing,simulations,orotherface-to-facetypesoftraining.Workbooks/manualsEmployeesrefertotrainingworkbooksandmanualsforinformation.ClassroomlecturesEmployeesattendlecturesdesignedtoconveyspecificinformation.Exhibit11-9Technology-BasedTrainingMethods(2of2)MethodCharacteristicsVideos/podcastsEmployeeslistentoorwatchselectedmediathatconveyinformationordemonstratecertaintechniques.SynchronousvideoprogramsEmployeeslistentoorparticipateasinformationisconveyedortechniquesdemonstrated.E-learningInternet-basedlearningwhereemployeesparticipateinmultimediasimulationsorotherinteractivemodules.MobilelearningLearningdeliveredviamobiledevices.VirtualrealityUsingVRheadsetsandcustomizedsoftware,employeeslearnthroughsimulatedpracticesDevelopingEmployeesWhereastrainingprogramsfocusondevelopingskillsforyourcurrentjob,employeedevelopmentactivitiesarefocusedonpreparingyouforyourfutureroleswithinthecompany.Microsoftprovidesarangeofdevelopmentactivities,asoutlinedinExhibit11-10onthenextslide.Exhibit11-10TrainingandDevelopmentatMicrosoftDemonstratingitscommitmenttotraininganddevelopingitsemployees,Microsoftoffersdiverselearninganddevelopmentopportunities.Thecompanyphilosophyofprovidingthe“rightlearning,attherighttime,intherightway,”meansMicrosoftoffersmorethanformalinstruction.Examplesincludethefollowing:PersonalizedlearningopportunitiesthroughMicrosoftLearningandLinkedInLearningOfferingin-personclasseswithopportunitiestosharelearningonlinewithotheremployeesOpportunitiestolearnon-the-jobtoprepareforfuturejobsFrequentpromotionopportunitiesEncouragingemployeeinteractionswiththeirmanagersforcareerguidanceTrainingmanagersoncoachingandmentoringProvidingthoroughemployeeorientationcoveringcompanyvalues,companyculture,andotherexpectedbehaviorsPerformanceFeedbackPerformanceappraisal/evaluation:thepracticeofprovidingjobfeedbacktoanemployeethatmaybeusedtoimproveperformanceandforcompensationandpromotiondecisions.Manycompanieshavelearnedthattheannualreviewprocessisnottimelyenoughtomakeanimpact.Immediatefeedbackandsmallerstepstowardimprovementaremorerealisticandcanleadmorequicklytobetterperformance.ElectronicPerformanceMonitoringElectronicperformancemonitoring:theuseofelectronicinstrumentstocollect,store,analyze,andreportindividualorgroupperformance.Thistechnologyisbeingwidelyusedincallcenterswheresupervisorscancontinuallytrackandanalyzeanemployee’sworkflowinrealtime.Electronicmonitoringsystemscancontinuallycollectinformationonperformancemetricsliketheaveragecallhandlingtime,totalnumberofcallshandled,andtimeonbreaks.Exhibit11-11PerformanceEvaluationMethods

(1of2)MethodDescriptionAdvantages/DisadvantagesWrittenEssayEvaluatorwritesadescriptionofemployee’sstrengthsandweaknesses,pastperformance,andpotential;providessuggestionsforimprovement.+Simpletouse−Maybebettermeasureofevaluator’swritingabilitythanofemployee’sactualperformanceCriticalIncidentEvaluatorfocusesoncriticalbehaviorsthatseparateeffectiveandineffectiveperformance.+Richexamples,behaviorallybased

−Time-consuming,lacksquantificationGraphicRatingScalePopularmethodthatlistsasetofperformancefactorsandanincrementalscale;evaluatorgoesdownthelistandratesemployeeoneachfactor.+Providesquantitativedata;nottime-consuming

−Doesn’tprovidein-depthinformationonjobbehaviorExhibit11-11PerformanceAppraisalMethods

(2of2)MethodDescriptionAdvantages/DisadvantagesBARS(BehaviorallyAnchoredRatingScale)Popularapproachthatcombineselementsfromcriticalincidentandgraphicratingscale;evaluatorusesaratingscale,butitemsareexamplesofactualjobbehaviors.+Focusesonspecificandmeasurablejobbehaviors−Time-consuming;difficulttodevelopMultipersonComparisonEmployeesareratedincomparisontoothersinworkgroup.+Comparesemployeeswithoneanother

−Difficultwithlargenumberofemployees;legalconcernsMBOEmployeesareevaluatedonhowwelltheyaccomplishspecificgoals.+Focusesongoals;resultsoriented

−Time-consuming360-DegreeAppraisalUtilizesfeedbackfromsupervisors,employees,andcoworkers.+Thorough

−Time-consumingCompensationandBenefitsSkill-basedpay:apaysystemthatrewardsemployeesforthejobskillstheycandemonstrateVariablepay:apaysysteminwhichanindividual’scompensationiscontingentonperformanceExhibit11-12WhatDeterminesPayandBenefitsExhibit11-12summarizesthefactorsthatinfluencethecompensationandbenefitpackagesthatdifferentemployeesreceive.OtherPayFactorsBonusesvs.AnnualPayRaisesPaySecrecyvs.TransparencyBenefitOptionsReviewLearningObjective11.1Explaintheimportanceandprocessofmanaginghumanresources.CompetitiveadvantageOrganizationalstrategiesImpactofemployeetreatmentonorganizationalperformanceReviewLearningObjective11.2Describetheexternalinfluencesthataffectthehumanresourcemanagementprocess.EconomyLaborunionsLegalenvironmentDemographictrendsReviewLearningObjective11.3Discussthetasksassociatedwithidentifyingandselectingcompetentemployees.Planning:JobanalysisJobdescriptionJobspecificationRecruitment/decruitmentSelectionRealisticjobpreviewReviewLearningObjective11.4Explainhowcompaniesdevelopworkplacetalent.OrientationTraining:Profession/industry-specifictrainingManagement/supervisoryskillsMandatory/complianceinformationCustomerservicetrainingTraditionaltrainingversustechnology-basedmethodsReviewLearningObjective11.5Describestrategiesforretainingcompetent,high-performingemployees.PerformancemanagementsystemPerformanceappraisalmethodsFactorsinfluencingcompensationandbenefitsSkill-basedpaysystemsversusvariablepaysystemCopyrightThisworkisprotectedbyUnitedStatescopyrightlawsandisprovidedsolelyfortheuseofinstructorsinteachingtheircoursesandassessingstudentlearning.Disseminationorsaleofanypartofthiswork(includingontheWorldWideWeb)willdestroytheintegrityoftheworkandisnotpermitted.Theworkandmaterialsfromitshouldneverbemadeavailabletostudentsexceptbyinstructorsusingtheaccompanyingtextintheirclasses.Allrecipientsofthisworkareexpectedtoabidebytheserestrictionsandtohonortheintendedpedagogicalpurposesandtheneedsofotherinstructorswhorelyonthesematerials.ManagementSixteenthEditionChapter12ManagingChangeandInnovationCopyright©2025,2021,2018PearsonEducation,Inc.AllRightsReservedLearningObjectives12.1Describemakingthecaseforchange.12.2Compareandcontrastviewsonthechangeprocess.12.3Classifyareasoforganizationalchange.12.4Explainhowtomanagechange.12.5Comparedifferenttypesofinnovation.12.6Describehowmanagerscanstimulateinnovation.TheCaseforChangeOrganizationalchange:anyalterationofpeople,structure,ortechnologyinanorganizationChangeagent:

someonewhoactsasacatalystandassumestheresponsibilityformanagingthechangeprocessVUCA:volatility,uncertainty,complexity,andambiguityIntoday’sworld,changeistheonlyconstantManagersmustdealwiththatrealityExhibit12-1ExternalandInternalForcesforChangeExternalForcesforChangeConsumerneedsandwantsNewgovernmentallawsTechnologyTheeconomyInternalForcesforChangeNeworganizationalstrategyCompositionofworkforceNewequipmentEmployeeattitudesCalmWatersVersusWhite-WaterRapidsMetaphorsCalmwatersmetaphor:UnfreezingthestatusquoChangingtoanewstateRefreezingtomakethechangepermanentExhibit12-2TheThree-StepChangeProcessExhibit12-2illustratesKurtLewin’sthree-stepchangeprocess.White-WaterRapidsMetaphorWhite-waterrapidsmetaphor:thelackofenvironmentalstabilityandpredictabilityrequiresthatmanagersandorganizationscontinuallyadaptandmanagechangeactivelytosurviveAreasofChangeManagersfocusonfourmainareasofchange:Strategy:modifyingtheapproachtosuccessStructure:

structuralcomponentsandstructuraldesignTechnology:workprocessesorequipmentPeople:attitudes,expectations,andotherindividualorgroupbeliefsorbehaviorCulture:shiftinginresponsetointernalorexternalfactorsExhibit12-3FiveTypesofChangeExhibit12-3showsthefourmainareasofchangemanagersface.TypesofChange:StrategyFailuretochangestrategywhencircumstancesdictatecouldundermineacompany’ssuccess.Competitioncandictateachangeinstrategy.Organizationsthatdon’trecognizeaneedtochangestrategymaynotsurviveinthelongrun.TypesofChange:StructureChangingstructuralcomponentsChangingstructuraldesignTypesofChange:CultureAnorganization’scultureisverydifficulttochange.Acknowledgingthatorganizationalculturesarehardtochangedoesn’tmeanthattheycan’tbechanged.Theycan.CultureiseasiertochangewhenadramaticcrisisoccursleadershipchangeshandstheorganizationisyoungandsmallthecultureisweakExhibit12-4:ChangingCultureSetthetonethroughmanagementbehavior;topmanagers,particularly,needtobepositiverolemodels.Createnewstories,symbols,andritualstoreplacethosecurrentlyinuse.Select,promote,andsupportemployeeswhoadoptthenewvalues.Redesignsocializationprocessestoalignwiththenewvalues.Toencourageacceptanceofthenewvalues,changetherewardsystem.Replaceunwrittennormswithclearlyspecifiedexpectations.Shakeupcurrentsubculturesthroughjobtransfers,jobrotation,and/orterminations.Worktogetconsensusthroughemployeeparticipationandcreatingaclimatewithahighleveloftrust.TypesofChange:TechnologyNewequipment,tools,ormethodsAutomationComputerizationTheInternetofThingsTypesofChange:PeopleOrganizationaldevelopment:changemethodsthatfocusonpeopleandthenatureandqualityofinterpersonalworkrelationshipsExhibit12-5PopularODTechniquesThemostpopularODtechniquesaredescribedinExhibit12-5.WhyDoPeopleResistChange?UncertaintyHabitFearoflossBeliefchangeisinconsistentwithgoalsoforganizationExhibit12-6onthenextslideshowstechniquesmanagerscanusetoreduceresistancetochangeExhibit12-6TechniquesforReducingResistancetoChangeTechniqueWhenUsedAdvantageDisadvantageEducationandcommunicationWhenresistanceisduetomisinformationClearupmisunderstandingsMaynotworkwhenmutualtrustandcredibilityarelackingParticipationWhenresistershavetheexpertisetomakeacontributionIncreaseinvolvementandacceptanceTime-consuming;haspotentialforapoorsolutionFacilitationandsupportWhenresistersarefearfulandanxietyriddenCanfacilitateneededadjustmentsExpensive;noguaranteeofsuccessNegotiationWhenresistancecomesfromapowerfulgroupCan“buy”commitmentPotentiallyhighcost;opensdoorsforotherstoapplypressuretooManipulationandco-optationWhenapowerfulgroup’sendorsementisneededInexpensive,easywaytogainsupportCanbackfire,causingchangeagenttolosecredibilityCoercionWhenapowerfulgroup’sendorsementisneededInexpensive,easywaytogainsupportMaybeillegal;mayunderminechangeagent’scredibilityCreativityVersusInnovationCreativity:theabilitytocombineideasinauniquewayortomakeunusualassociationsbetweenideasInnovation:takingcreativeideasandturningthemintousefulproductsorworkmethodsDisruptiveInnovationDefinitionDisruptiveinnovation:innovationsinproducts,services,orprocessesthatradicallychangeanindustry’srulesofthegameBreakthroughinnovation:createsamarketwhereonedidnotexistbeforeSustaininginnovation:smallandincrementalchangesinestablishedproductsratherthandramaticbreakthroughsExhibit12-7ExamplesofPastDisruptiveInnovatorsEstablishedBusinessDisruptorEstablishedBusinessDisruptorCompactdiscAppleiTunesTraveler’schecksATMsandVisaCarbonpaperXeroxcopymachineEncyclopediasWikipediaCanvastennisshoesNikeathleticshoesNewspaper

classifiedadsCraigslistPortableradioSonyWalkmanAM/FMradiostationsSiriusXM

SonyWalkmanAppleiPod

TaxpreparationservicesIntuit’sTurboTaxTypewritersIBMPCYellowPagesGoogleWeeklynews

magazinesCNNPapermapsGarmin’sGPSTVnetworksCableandNetflixPaperbackbooksKindleLocaltravela

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