A STRATEGIC PLAN FOR LOBELLES SALON

Presented to the Department of Master in Business Management MSU-Iligan Institute of Technology Iligan City

In Partial Fulfillment of the Requirements of the Subject Business Policy

ROSEDEL T. ROSAS October 2012

TABLE OF CONTENTS

I. II.

INTRODUCTION

COMPANY PROFILE VISION/MISION STATEMENT III. ENVIRONMENTAL SCANNING 1. External Analysis 1.1 Industry Analysis 1.2 External Factor Evaluation (EFE) 1.3 Porters Five Forces Model 2. Internal Analysis 2.1 Resources, Capabilities and Core Competencies 2.2 VRCNs 2.3 Delta Model 2.4 Value Chain 2.5 Internal Factor Evaluation (IFE) 2.6 Bundle of Competencies 2.7 Baldrige Self-Assessment Worksheet IV. STRATEGY FORMULATION 1. SPACE Matrix 2. Balance Scorecard 3. Blue Oceans Strategy 3. ACTION PLANNING 6.1 Reward System 6.2 Lowering Service Rates During Morning 4. ACTION IMPLEMENTATION 5. EVALUATION CONCLUSION REFERENCES APPENDICES 13 14 10 10 11 11 12 12

I.

INTRODUCTION One of the keys to a successful development and implementation of a strategic plan

is to ensure the process utilized is appropriate for the organization and its stakeholders. II. COMPANY PROFILE

1.1 The Organization

Lobelles Salon is a sole proprietorship and a family owned business. It was established in the year 1972 with its goal committed to serve peoples different needs in body health and beauty. The salon is currently owned and managed by Mrs. Diosdada Rosas with twenty-two (22) employees and is located at City Hall Arcade, Borromeo St., Brgy. San Juan, Surigao City. In the very beginning, the salon was solely owned and managed by Mrs. Natalia Ramirez and in 1989 it was bought by Mrs. Diosdada Rosas. Due to lack of resources she was helped by her friend Mrs. Elena Cubillan to continue the business. Mrs. Cubillan aided the financial needs for building renovation and materials needed to operate the business. In the year 2000, Lobelles Salon had its new look equipped with modern facilities. Lobelles Salon offers a wide range of services from hair styling (haircut, blower, ironing, cellophane, curling, dye/color, hot oil, relax, shampoo and straightening/rebonding) and skin treatments (facial, body and foot spa) to bleaching, manicures, pedicures and make-up application. It also offers home services where customers can choose employees to handle them in a definite time.

1.2 Organizational Structure

The organizational structure of Lobelles Salon is very simple. It has its manager who happens to be the owner of the business, next to her is the cashier and then the twenty beauticians (B).

Owner/Manager ag Cashier

B1

B2

B3

B4

..

B18

B19

B20

B22

Figure 2.Organizational Structure of Lobelles Salon

1.2.1 Manager
The manager is also the owner of the organization. She is responsible in overseeing all the operations of the salon such as human resources, procurement of materials the salon uses in order to offer the services, and marketing. She also provides instructions to employees (beauticians) on how to do the job properly that would give the customers satisfaction.

1.2.2 Cashier
The cashier receives payments from the customers and lists it in the ledger under the beautician who handled the customer. She also computes the share of both the salon and the beautician in a given service rendered by the beautician. She monitors the employees who are late and absent.

1.2.3 Beauticians (B)

Render the different services that the salon offers to the customers. There are 22 beauticians presently, ten (10) regular employees, eight (8) contractual employees, and four (4) on-call beauticians. III. VISION/MISSION STATEMENT 1.1 Vision Statement

We are the leading beauty salon in the country and the trendsetter in beauty and healthcare. 1.2 Mission Statement

At Lobelles Salon, we strive to: Provide beauty and healthcare services at the highest quality at all times; Strengthen our presence in Surigao City and further extend our reach beyond the territory.

IV.

ENVIRONMENTAL SCANNING 1. External Analysis 1.1Industry Analysis

The beauty salon industry is mainly composed of small, independently owned salons. An average salon offers services such as haircutting, styling, coloring, shampooing, and permanents. Other salons have expanded their businesses to offer services such as nail care, facials, makeup application, waxing, massage, tanning and other beauty treatments. (Anastasia Zoldak). 1.2 External Factor Evaluation (EFE)

External Factor Evaluation [EFE] Matrix: The Case of Lobelle's Salon

Key External Factors

Weight

Rating

Weighted Score

Opportunities
1. Evolving hair trends and styles 2. A steady growing market that is traditionally unaffected by the 0.1 0.15 3 4 0.3 0.6

economic environment. 3. The ability to decrease marginal fixed costs as the customer base 0.15 grows. 4. Increasing sales opportunities as more people from an individual family and newly opened nearby mall frequents Lobelles. 0.1 3 3 0.45 0.3 1.65

Sub-Total 0.5 Threats

1. Established beauty salons. 2. New beauty salon that enters the area. 3. Lower prices offered by other beauty salons. 4. Different services offered by other beauty salons. 0.15 0.11 0.15 0.09 3 2 4 2

0.45 0.22 0.6 0.18 1.45 3.1

Sub-Total 0.5
Total 1

Weight for each factor: 0.0 (not important)-1.0 (very important)

Critical Success Factor Rating: 4 = the response is superior 3 = the response is above average 2 = the response is average 1 = the response is poor The result of the analysis is showing a total of EFE score of 3.1. This figure indicates an above average rating of the external opportunities and threats, indicating a relatively good scenario.

1.3 Porters Five Forces Model

Entry Barrier The entry barrier for this industry is high for several key reasons. In the beauty salon industry, economies of scale is not very important. Most of the recent growth has been in small businesses with between five and nine employees, reflecting perhaps smaller independents expanding existing operations or opening a second outlet (Mintel, 2007). Anyone can set up a beauty salon, since there is no legal requirement ort single, national accreditation scheme. However, experienced operators

profiting from loyal base of customers have significant advantage on new entrants, and retaliation tactics are very frequent. Lobelles Salon is one of the established beauty salon in Surigao City and it has gained many loyal customers throughout the years. And most of these loyal customers are afraid to try the services offered by the new entrants because they have not tested the quality of their services. Though David Salon has recently opened one outlet in the city, customers still choose Lobelles Salon because of its quality service and affordable price. Moreover, the initial costs are very high because you need to set up a space that is attractive to customers for them to relax and enjoy the services the salon offers and necessary equipment to perform the treatments. Bargaining Power of Supplier Suppliers in this industry are those who provide products for hair treatments, nail care, facial, body massage and foot spa. LOreal is the biggest and known supplier for hair treatments and Bobbie for nail care, although there are many medium-small competitors such as Wella and Indola for hair; Rain and SanSan for nails. The main players in this industry are highly fragmented, therefore supplier like LOreal and Bobbie have a huge bargaining power. Although it is very simple and inexpensive switching to another supplier, the prestige to be associated with LOreal and Bobbie Brand is too essential to be without. And these products can give effective results and satisfy the customers. For facial, body massage and foot spa products, the salon can easily switch to other suppliers Bargaining Power of Buyer The beauty salon industry has a huge pool of existing; therefore, customers influence on prices and services is very powerful. Latest industry figures have found that average prices for treatments had fallen compared to 2005. (Mintel, 2007) Moreover, customers switch to competitors or to different providers of the service such as mobile beautician is very frequent. Threat of Substitutes The fact that the services offered in a beauty salon is often branded as luxury, places the industry in a wider competitive environment. Today, to others its a luxury but to those who are concerned how they look, it is a necessity. It is necessary for a working people to look presentable to his/her colleagues and superior. To look beautiful can also help a person to be successful too. Thats why there are many beauty products available in the market. These may threaten the salon because customers can choose to buy these products and apply it themselves. Yes, customers can perform some services offered in a salon like manicure and pedicure, facial and hair treatments, yet it would be difficult to perform such treatments on themselves. It is more often relaxing and convenient for a professional to perform body and hair treatments on a customer-the results are also more effective. Therefore, threat of substitute product/service is low. Intensity of Rivalry The Beauty Salon industry sector is mainly dominated by micro-businesses; actually, 62% of the operators are single salons with fewer than five employers (Habia, 2007) and the costs of exiting from this sector are, therefore, very low Moreover, the market has been enjoying a steady growth rate (28% growths in client spend 20012006; Habia, 2007) The basic service offered is fairly similar between the competitors; indeed, the market positioning of the single salon and the ability to afford huge promotional campaigns can offer a significant competitive advantages. The significance of product/service differentiation is that it widens the parameters of competitive action, with firms competing against each other in quality advertising, etc., rather than on price alone. (Adcock D. et al, 2001 p. 66) Therefore, the intensity of rivalry is high.

1. Features of the industry in each 5 forces.

Barriers to Entry An economy of scale is not very important. Initial costs are very

high, thus, higher entry barrier. Experienced operators profiting

from loyal base of customers have significant advantage on new entrants

New Entrants Th re at of N e w E ntr an ts is Lo w

Intensity of Rivalry The Hair Beauty industry sector is mainly dominated by microbusinesses; actually, 62% of the operators are single salons with fewer than five employers (Habia, 2007) and the costs of exiting from this sector are, therefore, very low The market has been enjoying a steady growth rate (28% growths in client spend) The basic service offered is fairly similar between the competitors, indeed, the market positioning of the single salon and the ability to afford huge promotional campaigns can offer a significant competitive advantage.

Industry Competitors
Suppliers Bargaining Power of Suppliers is High Bargaining Power of Buyers is High Buyers

Intensity of Rivalry is High

Power of Suppliers LOreal and Bobbie is the highest and best known supplier in the sector, although there are many mediumsmall competitors such as Wella and Indola for hair; Rain and SanSan for nails. The main players in this industry are highly highly fragmented, therefore supplier have a huge bargaining power. Although it is very simple and inexpensive switching to another supplier, the prestige to be associated with LOreal brand is too essential to be without.

Threat of Substit utes Is Low Substitutes Availability of Substitutes Customers can perform some services offered in a salon like manicure and pedicure, facial and hair treatments, yet it would be difficult to perform such treatments on themselves. It is more often relaxing and convenient for a professional to perform body and hair treatment on a customer-the results are also more effective

Power of Buyers The beauty salon industry has a huge pool of existing; therefore, customers influence on prices and services is very powerful. Customers switch to competitors or to different providers of the service such as mobile beautician is very frequent.

2. Assessment of the level of entry and exit barriers. Entry Barriers Low High Exit Barriers Low High

3. Conclusion
Using Porters analysis firms are likely to generate higher returns if the industry: Is difficult to enter There is limited rivalry Buyers are relatively weak Suppliers are relatively weak There are few substitutes With the case of the beauty salon industry, the industry is difficult to enter because of high initial costs. Buyers are relatively weak and there are few substitutes. Out of the five forces, three forces are favorable for the industry to be attractive. As with the two forces not being favorable such as high power of suppliers and the intensity of rivalry is high, the managers should think that choosing the best supplier could attract more customers because of the prestige the brands bring in the salon, thus making the salon a high-end one. And customers trust and loyalty will be gained because of the best results and satisfaction they will experience. High rivalry intensity can be solved with service differentiation and quality advertising. Therefore, the beauty salon industry is attractive.

4. Action Planning
The goal of the Action Plan phase is to create an action plan that will guide the next phase of the process, Action Implementation or Intervention. For this reason, planning change is not about implementing the solutions being discussed. Instead, it is an opportunity to explore the potential solutions further and determine exactly how the intervention will proceed. In this case, the manager identified two levels of intervention: one directly motivating the employees and second is indirectly motivating them. The first intervention is to create a reward system that will boost them to work hard and efficiently and the second one will be changing the rates of some services into lower prices so that more customers will come in the morning, thus, motivating the employees to come early knowing that there will be customers by that time and their time would not be wasted waiting for the customers.

4.1 a.

RewardsSystem

Awarding a gift certificate or time off. Set targets with a rewards system for a job well done. Give peak performers a gift certificate or a special day off for exceeding managers goals and expectations. A gift certificate to Starbucks or to a local dinner restaurant will always be appreciated by the employees. This may be done quarterly.

b.

Rewarding perfect attendance will address the issue of tardiness.Offering something special for not missing work or being tardy for a year. It may be a bonus or salon services for the most improvement in attendance and timely arrival. This is once a year.

c.

Holding a team contest may motivate employees to work hard.Having team contests and rewarding the staff member that sells the most in retail or other salon services.

11 With these they will be eager to render service as much as possible and would use their time wisely. This could be monthly.

4.2

Lowering Service Rates during Morning

The manager, together with the consultant plans to have lower service rates during morning in order to attract customers to go to the salon during this time for the employees to come early. There will only be selected services that will be priced low or maybe they (manager and employees) could schedule which services will be lowered for the first month and on the second month will be other services and so on.

5. Action Implementation
The Action Implementation or Intervention phase is where the plan is executed and the solution is actually implemented within the client organization. Unlike the Diagnosis phase where the consultant often accepts responsibility as the expert, this is one time in the engagement where the consultant can take more of a facilitator role. It is the consultants goal to support the clients development, but the client must be accountable. The client organization is what must change, and only actual members of this organization (i.e., the client can be experts of this environment. In this case, the actual implementation of the interventions has not been accomplished due to some constraints. The first constraint is that the owner manager is not the one controlling the finances of the salon. Though the manager is the owner but the one who is financing the company now has the final say especially when money is involved. The plan will be implemented when she will be the one controlling the companys finances sometime this year.

12

6. Evaluation
Finally, an evaluation of the success of the OD effort should always be undertaken. Often this requires collecting additional data regarding the impact of the intervention in the light of the deliverables that were agreed on in the contracting phase, as well as brainstorming about process improvements for future OD efforts. In an informal manner, evaluation occurred during every phase of work during this engagement. For the scouting phase, the consultant has chosen the right organization for her to apply the principles of an OD process. The entry phase was also a success because the client organization had given its interest and support with this project. During the data collection process the consultant and the client were very collaborative in order for the essential data to be gathered to support the initial presenting of issues. The findings and the analysis of the data collected was also successfully reported and presented to the client organization and the members of the organization clarified the result of the analysis. In planning the interventions, the client also initiated on what do next in order to find solutions to the problem that the client and consultant have diagnosed. Implementation of interventions however did not happen due to some reasons stated in Action Implementation section but that would not mean that this phase was a failure. This may not happen today but it will happen sometime this year and the consultant will continually keep in touch with the manager to eventually implement the interventions.

CONCLUSION
In conclusion, the consultant has successfully applied the process of an OD plan. The consultant learned new experiences and ways in conducting an OD effort. There is a collaborative relationship present between the consultant and the client organization which

13 led to a successful planned change. This is an ongoing and continuing project and the consultant hopes to continue the actual implementation of interventions at a designated time to eventually see the results of the collaborative efforts of the consultant and the organization and the desired changes in the organization for its betterment.

REFERENCES
1 2 3 4 5 http://www.odnetwork.org/odnc/whatis.htm http://hcds4you.com/blog/7-ways-increase-salon-performance-productivity/ Cummings, Thomas G., Christopher G. Worley. Organization development and Change Lurey, Jeremy S., Matt Griffin (2002). Action Research: The Anchor of OD Practice. OD Practitioner. Vol. 34. No. 3. pp. 15-20 Waclawski, Janine, Allan H. Church. Organization Development. pp. 15-17

APPENDICES

14

APPENDIX 1 LETTER OF REQUEST

Republic of the Philippines Mindanao State University - Iligan Institute of Technology Iligan City COLLEGE OF BUSINESS ADMINISTRATION AND ACCOUNTANCY Master in Business Management Department March 12, 2011 Dear Sir/Madam; The undersigned is presently conducting an Organization Development (OD) Process for Lobelles Salon, Surigao City. A crucial part of the entire process is to undergo a survey to determine how employees view the organization and to identify areas for improvement. The result of the research will serve as a basis for action planning and implementing interventions for the betterment of the organization. This is in partial fulfillment of the requirements of the course BA222 N Organization Development. In line with this, I humbly request you to participate in this OD Plan by answering the attached questionnaire. Your cooperation will help facilitate analysis of the organization and will make this endeavor successful. Thank you so much.

Very truly yours,

ROSEDEL T. ROSAS OD Researcher

15

APPENDIX 2 Orientation Questions for a New Client

Directions to the Client: Thank you for contacting me about possible consulting
services. Simply answer the questions below in the space provided (add more paper if needed). Part I: The Organization How old is your organization (that is, when was it founded)? 1

What are the strategic objectives of your organization? (Please provide a copy of the organization's strategic plan, if possible.)

How is the organization structured? (Rather than writing this out, you can attach an organization chart if you prefer.)

How large is your organization? How many employees does it employ?

In how many locations does the organization operate?

If the organization is a business, how profitable is it? If the organization is a government agency or a nonprofit organization, how well do revenues match expenses?

Please send any relevant documents, such as an organization chart or an annual report, to me by mail.

Part II: The Organization's Environment In what industry does your organization operate? (Describe it.) 7

What special challenges does your industry face? Examples might include narrowing profit margins, challenges by e-commerce businesses, increased regulation, or changes in the law. (Please list and describe the challenges.)

16

What is the outlook of your industry, in your opinion? Are long-term conditions favorable, unfavorable, or mixed for a business in your industry? Please explain and give reasons briefly.

Part III: The Presenting Problem, Issue, or Opportunity 10 Tell me why you are seeking consulting assistance now. Do you have a specific problem for which you are seeking a solution? If so, what is it? Do you have an issue to address for which you are seeking help? If so, what is it? Do you have a vision for improvement for which you are seeking assistance to realize? If so, what is it?

11

What is the background of the problem, issue, or opportunity? When did it first appear, and how did you notice it?

12

What is your role in dealing with the problem, issue, or opportunity? (Explain your responsibilities in the organization and how the problem, issue, or opportunity affects you and why.)

13

What results do you hope to achieve from this consulting relationship and/or what goals do you hope to meet from this relationship?

14

What efforts have you (or others in the organization) already made to solve your problem, address your issue, or realize your improvement opportunity? In other words, what have you already done, and what happened as a result of what you have done?

15

What other information could you provide me with before we meet to help me to be better prepared or become more knowledgeable about the problem, issue, or opportunity for improvement?

Thank you for your cooperation. Consultants Contact Info Rosedel T. Rosas LilyAns Boarding House, Tibanga Highway, Iligan City, 9200 639061887137

bem_rose@yahoo.com

17

APPENDIX 3

Organizational Diagnosis Questionnaire

By : Robert C. Preziosi

Pangutana sa Han-ay nga Pagpaniid

Translated in Cebuano By : Rose N. Nayre

Directions: Do not put your name anywhere on this questionnaire. Please answer all
thirty-five questions. Be open and honest. For each of the thirty-five statements circle only one (1) number to indicate your thinking.

Pahimangno: Dili isulat bisan asa ang inyong ngalan ning papela. Tubaga ang tanang 35 ka pangutana. Mobukas lang ug magmatinud-anon. Sa matag usa sa 35 ka pagpamulong usa (1) lang ka numero ang lingini aron ipadayag ang imong hunahuna.

The goals of this organization are clearly stated.

Tin-awng gipahayag ang mga tumong ning organisasyona.

The division of labor of this organization is flexible.

Mapahaumon ang pagbahin sa bulohaton ning organisasyona.

My immediate supervisor is supportive of my efforts.

Motabang ang direkta nakong superbisor kun tagdumala sa akong mga paghago.
My relationship with my supervisor was a harmonious one.

4 5

Maayo ang relasyon nako sa akong superbisor.

My job offers me the opportunity to grow as a person.

1 1

2 2

3 3

4 4

5 5

6 6

7 7

Kusganong Dili Mouyon

Kusganong Mouyon

Medyo Dili Mouyon

Disagree Strongly

Disagree Slightly

Medyo Mouyon

Agree Strongly

Alang-alangan

Agree Slightly

Dili Mouyon

Disagree

Mouyon

Neutral

Agree

18
Makapatubo nako ang akong trabaho isip usa ka tawo.
My immediate supervisor has ideas that are helpful to me and my work group.

Dunay mga ideya ang direkta nakong superbisor nga makatabang nako ug sa kauban nako sa trabaho.
This organization is not resistant to change.

Dili mosalikway sa kausaban kining organisasyona.

I am personally in agreement with the stated goals of my work unit.

Niuyon gyud ko sa gipahayag nga mga tumong sa akong gitrabahoan.

The division of labor in this organization is intended to help it reach its goals.

Tuyo sa pagbahin sa bulohaton ning organisasyona nga motabang nga makab-ot ang mga tumong niini.
The leadership norms of this organization help its progress.

10

Makatabang ang mga lagda sa pagpanguna ning organisasyona sa pag-uswag niini.

I can always talk with someone at work if I have a work-related problem.

11

Kanunay kong makapakigsultianay sa akong kauban sa trabaho bahin sa problema nga may kalabutan sa trabaho.
The pay scale and benefits of this organization treat each employee equitably.

12

Maangayon ang sweldo ug mga kaayohan kun mga benepisyo ning organisasyona alang sa matag empleyado.
I have the information that I need to do a good job.

13

Duna koy kasayuran nga akong kinahanglan aron mabuhat gyud nako ang maayong trabaho.
This organization introduces enough new policies and procedures.

14

19
Nagpailaila kining organisasyona ug bag-ong mga patakaran ug mga paagi.

15

I understand the purpose of this organization.

Nasabtan nako ang tuyo ning organisasyona.

The manner in which work tasks are divided is a logical one.

16

Makatarunganon ang pagbahin sa mga bulohaton sa trabaho.

This organizations leadership efforts result in the organizations fulfillment of its purposes.

17

Moresulta sa pagkatuman sa mga tumong sa organisasyon ang pagpaningkamot sa pagpanguna ning organisasyona.
My relationships withmembers of my work group are friendly as well as professional.

18

Mahigalaon ug propesyonal sab ang relasyon nako sa mga miembero sa kagrupo nako sa trabaho.
The opportunity for promotion exists in this organization.

19

Dunay kahigayonan alang sa promosyon kun pag-uswag kining organisasyona.

This organization has adeqaute mechanisms for binding itself together.

20

Dunay igong mekanismo kining organisasyona aron mabugkos kini pag-usa.

This organization favors change.

21

Mouyon sa kausaban kining organisasyona.

The priorities of this organization were understood by its employees.

22

Nasabtan sa mga empleyado ning organisasyona ang mga prayoridad niini.

The structure of my work unit is well designed.

23 24

Giplano pag-ayo ang estruktura sa akong gitrabahoan.

It is clear to me whenever my boss is

1 1

2 2

3 3

4 4

5 5

6 6

7 7

20
attempting to guide my work efforts.

Klaro para nako kon maningkamot ang akong agalon sa paggiya sa mga pagpaningkamot nako sa pagtrabaho.
I have established the relationships that I need to do my job properly.

25

Naestablisar na nako ang mga relasyon nga akong gkinahanglan aron mabuhat gyud nako ug maayo ang akong trabaho.
The salary that I receive is commensurate with the job that I perform.

26

Takdo ang sweldo nga madawat nako sa trabaho nga gibuhat nako.
Other work units are helpful to my work unit whenever assistance is requested.

27

Matinabangon ang ubang yunit sa trabaho sa yunit sa akong trabaho kon gikinahanglan ang pagtabang.
Occasionally I like to change things about my job.

28

Usahay gusto nakong usbon ang mga butang kalabut sa akong trabaho.
I had enough input in deciding my work-unit goals.

29

Duna koy igong ideya sa pagdesider sa mga tumong sa yunit sa akong trabaho.
The division of labor in this organization actually helps it to reach its goals.

30

Makatabang gyud ang pagbahin sa bulohaton ning organisasyona nga makab-ot ang mga tumong niini.
I understand my bosss efforts to influence me and the other members of the work unit.

31

Nakasabut ko sa mga pagpaningkamot sa akong agalon nga impluwensyahan ko ug ang uban pang miembro sa yunit sa trabaho.
There is no evidence of unresolved conflict in this organization.

32

Wala gyuy pruweba nga dili masulbad ang panag-away ning organisasyona.

21
All tasks to be accomplished are associated with the incentives

33

Dunay giandam nga mga pampadasig sa tanang bulohaton nga humanonon.

This oraganizatios planning and control efforts are helpful to its growth and development.

34

Makatabang ang pagplano ug pagkontrol ning organisasyona nga motubo ug molambo kini.
This organization has the ability to change.

35

Dunay kahimoan kining organisasyona nga mausab kun mabag-o.

Thank you! Salamat

ODQ SCORING SHEET Instructions: Transfer the numbers you circled on the questionnaire to the blanks below, add each column, and divide each sum by five. This will give you comparable scores for each of the seven areas. Purposes 1 8 15 22 29 Total Ave. Rewards 5 12 19 26 33 Total Ave. Structure 2 9 16 23 30 Total Ave
Helpful Mechanisms

Leadership 3 10 17 24 31 Total Ave.

Relationships 4 11 18 25 32 Total Ave.

6 13 20 27 34 Total Ave.

Attitude Toward Change 7 14 21 28 35 Total Ave.

22 BACKGROUND The ODQ is a survey-feedback instrument designed to collect data on organizational functioning. It measures the perceptions of persons in an organization or work unit to determine areas of activity that would benefit from an organization development effort. It can be used as the sole data-collection technique or in conjunction with other techniques (interview, observation, etc.). Weisbords Six-Box Organizational Model (1976) is the basis for the questionnaire, which measures seven variables: purposes, structure, relationships, rewards, leadership, helpful mechanisms, and attitude toward change. The first six areas are from Weisbords model, while the last one was added to provide the consultant/facilitator with input on readiness for change. The instrument and the model reflect a systematic approach for analyzing relationships among variables that influence how an organization is managed. The ODQ measures the informal aspects of the system. It may be necessary for the consultant/facilitator also to gather information on the formal aspects and to examine the gaps between the two. Instrumentation Kit Using the ODQ is the first step in determining appropriate interventions for organizational change efforts. Its use as a diagnostic tool can be the first step in improving an organizations or work units capability to serve its clientele. INTERPRETATION AND DIAGNOSIS A crucial consideration is the diagnosis based upon data interpretation. The simplest diagnosis would be to assess the amount of variance for each of the seven variables in relation to a score of 4, which is the neutral point. Scores above 4 would indicate a problem with organizational functioning. The closer the score is to 7 the more severe the problem would be. Scores below 4 indicate the lack of a problem, with a score of 1 indicating optimum functioning. Another diagnostic approach follows the same guidelines of assessment in relation to the neutral point (score) of 4. The score of each of the thirty-five items on the questionnaire can be reviewed to produce more exacting information on problematic areas. Thus diagnosis would be more precise. For example, let us suppose that the average score on item number 8 is 6.4. This would indicate not only a problem in organizational purpose, but also a more specific problem in that there is a gap between organizational and individual goals. This more precise diagnostic effort is likely to lead to a more appropriate intervention in the organization than the generalized diagnostic approach described in the preceding paragraph. Appropriate diagnosis must address the relationships between the boxes to determine the interconnectedness of problems. For example, if there is a problem with relationships, could it be that the reward system does not reward relationship behavior? This might be the case if the average score on item 33 was well above 4 (5.5 or higher) and all the items on relationships (4, 11, 18, 25, 32) averaged above 5.5.

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APPENDIX 4 Logical Framework

Strategy Components Goal: Improve the organizations performance and service to the customers Purpose: The employees are highly motivated to work and efficient in rendering service to customers to sustain them. And absenteeism and tardiness of employees are lessened. Outcomes: Skilled employees Indicators Increased number of regular customers Means of Verification Lobelles Salon Annual Report Cashiers Log Book Lobelles annual report Important Assumption

Number of employees who come regularly and early at work

Employees participated seminars once a year Giving of rewards at least twice a year

Personnel Records

Funding is partially guaranteed Funding is guaranted

Established monitoring of employee performance and giving rewards regularly to those who are worth rewarding. Increased in sales Activities: Employees attending seminars Offer promos to the customers Discuss among the employees of the promo rates during morning and agree by consensus Inputs: Budget

Reports on the employees who are rewarded

Sales increased

Lobelles Salon Annual Report