Organizational Change

Campbell and Bailyn’s Boston Office

Case StudySharon 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 thefinancial world, especially within the investment industry. The trying economictimes had created a different sort of demand in the market place that required theapplication of complicated debt instruments. Additionally, the shrinking of high-profile sales had influenced the organization to restructure the sales compensationin such a way that required sales teams to work more closely with product managerand research staff located in a different geographic area. The case details theseactions, but it is important to remember that the catalyst for this new behavior wasthe

changes in the environment.

Here, we can see the application of Lewin’s Field

Theory at work- the firm was in a state of quasi-equilibrium until forces in theenvironment (namely, the macro economic recession and mortgage crisis) createdforces that altered that state. According to Lewin, changes in the environment (thefield) result in changes in the behavior of the

group

within the field, and in this casethe pressure was enough to warrant a re-organization of the firm in order to bettercontend with the changes in the environment.

When analyzing the case through Lewin’s lens, it is also important to note the

elements of group dynamics that are at play. The changes in the field subsequentlyled 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 aschanges in the field created changes in the workplace, the behavior of groupmembers began to change. John Oates became distant and averse to his new, non-local team of product and research professionals, Callahan began displayingpessimism regarding general affairs, and Jen Ulin expressed satisfaction with thenew world order. This disparate state of group opinions and behavior wasdetrimental 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 negativeinfluencers in isolation

–

rather, the forces surrounding the team would need to beaffected and the team would need to traverse through the three-step-model as aunified 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 canlead to defensive behavior, combative dynamics between groups, and rivalry withina 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 newstructure 2) calls are coming in that require a higher level of knowledge dexterityand 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 theirperformance management review. All of these elements can very quickly lead to aclosed-system environment where the KAT team becomes unwilling to continuouslylearn from the rapidly changing economic environment and instead reinforces each

other’s 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 overthem, and all of the threats originate externally; factors which exacerbate thedevelopment of defensive and anti-learning behaviors. This could backfire in anumber of ways; 1) the new compensation system could lead to inner warfareinstead of the intended purpose of bridging the knowledge gap between sales andproduct 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 becomeincreasingly siloed with unhealthy working relationships developing between theKAT team and the remaining specialists.

Internal Fit

and Nadler’s C

ongruence 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 usexamine the most relevant fit segments

of Nadler’s congruence model

independently;1)

Individual-Organization: the members of the KAT team are now viewing theorganization through a very different lens than they did before the change.We can assume that the members of this team are type A, gregariousindividuals who enjoy a high-income lifestyle and who are experts inrelationship management. This assumption is valid because these are thepersonality and motivational characteristics that create excellent salespeoplein the investment business. Now, in the new organization, t

he salespeople’s

individual needs to be self-managing and independent are impeded by thefact that they have to rely on their other team members to assist in the careof their customers. Additionally, the new compensation structure has

created a dissonance between the individual salesperson’s goal to earn a high

commission and the organization’s goal to create products that better serve

the clients. On the surface, it would seem that these two goals are aligned-the better the product and the more expertise the salesperson has regardingthe product, the more sales he should be able to make. However, when thecompensation structure is abruptly changed to incorporate feedback fromcoworkers instead of being based solely on financial performance, theindividual 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 hadpreviously been generalists and functioned as singular and dedicatedrepresentatives of the firm for their clients, were now boxed into specialistsroles. Part of why these people were such high performers was due to thefact that they were able to build relationships with their clients above andbeyond 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 asthe only salesperson assigned to particular accounts, and so theserelationships began to be diluted. Instead, they were required to sell andmaintain accounts with only the merits of their investment acumen in aparticular area of expertise. This suggests that the new roles thesesalespeople were in were no longer a great fit for them as individuals, as thejob focus shifted from relationship to technical knowledge.3)

Task-Organization: At Campbell and Bailyn, the organizational changes andtasks changes go hand in hand. In order to better meet the changing needs of

the firm’s clientele, generalists had to become specialists and so their task

definition was radically altered. In order to help support this change, theKAT team was introduced and implemented. These two sides of the samecoin were designed as a means to reinforce the other, and to create a socialsupport system. However, because the individuals in the roles exhibit signsof task-mismatch, it is difficult to tell whether or not the task/organizationrelationship is effective. If Campbell and Bailyn, as a larger company, decidedto implement the KAT organization across the company, it might experiment first to see if a team comprised of salespeople who had been specialists in thepast might be better suited.

Part II: Action Research Implementation and Winston’s 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 takethe time to gather additional qualitative data that could have aided in the ideationprocess. Now, I would recommend that Winston go back and spend timeunderstanding the personalities and social dynamics that makeup the office

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 takethe time to gather additional qualitative data that could have aided in the ideationprocess. Now, I would recommend that Winston go back and spend timeunderstanding the personalities and social dynamics that makeup the office

environment. For example, he could issue personality tests to generalists andspecialists alike to determine if there are thematic traits that permeate eachemployee group. In addition, he could ask a skilled, objective party (consultant orotherwise) to interview members of the team in order to discern pain points anduncover underlying issues that have arisen since the added pressure of theeconomic crisis. Armed with such insight, Winston would then be better equippedto utilize his workforce in such a way that would both address the needs of themarket 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 hisgeneralist team in a meeting designed for that purpose. However, he neglected toinvolve any other office members- most notably, the specialists. By not gettingfeedback from over half the office, Winston and his team did not have theopportunity to get valuable insight from people who were already operating in a jobsimilar to the new one being designed. This insight may have brought to light theindividual/task misalignment that was previously noted, as the specialists werefamiliar 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 aconfiguration that was more conducive to multi-dimensional needs. In this regard, Irecommend that Winston take a step back and meet with the generalists andspecialists independently to get feedback on the process change. Then, he shouldconduct an office wide meeting where he delivers key insights uncovered at theprevious meetings to the greater team as a catalyst for constructive conversation.The greater team can then begin a brainstorming session to figure out someexperimental processes- these ideas would not only incorporate the combinedknowledge of the entire staff, but would also garner an element of buy-in fromeveryone instead of leaving a significant portion of the group completely out of thedecision.

3) Diagnosis:

Here, Winston also did a good job of ensuring that the diagnosis of theproblem was collaborative. However, he did not go through a structured diagnosticmodel to ensure that important considerations were taking place. He showed theteam quantitative evidence of recent poor performance, and this technique waslikely 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 withpersonality descriptions and cultural norm information. Armed with the properresearch, Winston could have gone much deeper into the stage of the Action-Research model.Specifically, when the team thought of the KAT, it could have examined theproposed team with the following questions:A. Does the group have measurable goals? Is its purpose clearly defined and agreedupon by all members?B. Do the group members have the proper experience to be able to accomplish theexplicit goals?

C. Is there a process to handle conflict that might arise as a result of the new teamdynamic? Should this be informal or formalized? What types of conflict can wepredict, and can we agree on some terms on how to objectively view and analyzesuch conflict?D. How will the group receive feedback? Will this be left up to the customers andthe new performance management program? Or will the team be able to doperiodic self-assessment and adjustment? If so, what should be the proper cadenceand format for these assessments?E. What is the impact of the new tasks on other members of the KAT? Othermembers in the office?F. What potential downfalls can we see? Are there mechanisms in place that canhelp mitigate?G. Do we feel, as individuals, that we are well suited to complete the new job as it isbeing outlined?These questions are tough to answer- but now that the KAT has been in effect forsome time, Winston might find it very helpful to run through a session designed toanswer 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 theKAT), to keep the specialization on the team, but revert back to single-handledaccounts. Meaning, only one member of the team would actually converse with aparticular 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 toadaptation 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 NewYork…Winston 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-infrom other management members for his idea. This did not necessarily follow anysort of OD/C recommended approach to this step.Some steps that Winston could take now in order to plan for the future of the KATteam are 1) Determine measurable goals for the team to achieve 2) Discuss tactics inorder to reach those goals 3) implement regular inspection and feedback sessionsfrom both the team and major clients. Encourage recalibration in order to foster anexperimental environment instead of one where high-performance is the onlyoption.Another element in the case that deserves further scrutiny by Winston is the newPerformance Management system. Although this was not his idea, if he did his duediligence in data collection and observation, he would probably find that the new

program was contributing to the KAT’s collective defensiveness and he might see it

as a threat resulting in heightened closed-system thinking. Essentially, the company

took one of the job’s 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 tosee why this would not be well received. It is a viable threat that the relationshipbetween this sales team and the product/research teams will begin to erode overtime, 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 andcollaboration between the sales team and other departments is to encouragerelationship building between them. Granted- further analysis would be necessaryto determine whether this is the right course of action for the product/researchteams, but in taking the initiative to dig deeper, ideas would most likely begin tosurface. From reading the case, I thought a potentially more feasible way for theseteams to communicate would be to organize retreats- weekend, multi-departmentalgetaways that were half debriefing sessions and half relationship-building activities.By tapping into the natural tendencies and skill of the sales team, the company couldbegin to organically grow collaboration that happens willingly, without threats to

one side and undue pressure on another to take on a “managerial” role.