The Awakening
Giant
Continuity and Change in
Imperial Chemical Industries
Andrew M. Pettigrew
Routledge Revivals
234x156 HB
Andrew M. Pettigrew
ROUTLEDGE
Routledge
Taylor & Francis Group
ANDREW M. PETTIGREW
Basil Blackwell
For Ethna
Contents
Acknowledgements
xiv
Preface
xvii
3
4
8
15
19
23
26
28
35
38
41
46
52
53
62
69
79
DEVELOPMENT 196572
84
viii
Contents
The Central Organisation Development Resources, 196472:
An Overview
Antecedents of MUPS and WSA
Dealing with Resistance to Change: The Birth and Early Life
of Central Organisation Development
The Legacy of WSA and SDP
87
90
98
114
120
121
132
139
141
143
156
158
173
196
209
214
215
234
237
244
251
256
258
259
Contents ix
Plastics Division's Use of Specialist Organisation Development
Resources: An Overview
Antecedents
Creation and Early Life of Training and Personnel Development
Department
Redundancy and the False Dawn, 197276
The Demise of Organisation Development in Plastics Division
9
12
291
304
316
319
320
334
338
345
354
362
364
11
283
289
376
381
391
395
403
425
438
444
453
471
477
483
Contents
Contexts, Antecedents, and Birth Processes of Organisation
Development in ICI
The Structure, Internal Development, Strategy, and Legitimacy
of the Organisation Development Groups
The Dilemma of Exclusivity and Inclusivity for Innovating Groups
The ICI Use of Organisation Development: Some Lessons
492
498
505
513
References
520
Author Index
531
Subject Index
534
Figures
Figure
1
Page
37
63
64
66
136
159
219
228
271
275
340
382
385
507
Tables
Table
1 Chemical Industry Output Growth Compared with Growth in
Manufacturing Output: UK, USA, and West Germany in Different
Time Periods, 196379
2 World Chemicals Production and Consumption, 1977
3 Percentage Increase in Chemical Production UK, West Germany,
France, 196080
4 Average Annual Growth Rates (Percentage) of Chemicals Output by
Economic Grouping and Region, 196079
5 Selected Major European Companies' Trend Towards Specialty
Products and Chemicals: Specialty Activities as a Percentage of
Total Sales
6 UK Employees in Employment and UK Chemical Industry
Employment, 195982
7 Value Added Per Employee in the Chemical Industries of UK,
USA, West Germany, and Japan, 196180
8 ICI Group Sales, Trading Profit, and Ratio of Trading Profit to
Sales Percentage, 195883 and GDP Output Percentage Growth
Per Annum, 196082
9 ICI Total Employees, UK, 196583, World Wide Employees
196883, and UK Employees as a Percentage of Total Employees,
196883
10 ICI: Contribution of Business Classes to Group Sales, Group
Trading Profit, and Trading Margins, 1979,1982, and 197379
11 ICI Sales and Trading Profit by Region, 1973,1976, 1979, and
1982
12 ICI Capital Expenditure and Capital Authorisation, 197082 and
Capital Expenditure by Region, 197082
13 Trading Profit to Sales Percentage: ICI and Selected Competitors,
197078
14 Ratio of Pre-tax and Interest Profit to Net Assets Percentage: ICI
and Selected Competitors, 197078
15 Capital Expenditure as a Percentage of Sales: ICI and Selected
Competitors, 196781
16 Sales, Investment, and Total Remuneration Per Employee: ICI and
Selected Competitors, 1978
Page
55
58
59
61
61
65
68
74
75
77
77
78
80
80
81
81
Tables xiii
17 Labour Turnover Males (Comparative Percentage Figures)
Billingham and Wilton Sites, 194956
18 Agricultural Division Weekly and Monthly Staff Employees,
196484
19 Agricultural Group Sales, Trading Profit, and Trading Margins,
196883
20 Petrochemicals Group Worldwide: Sales, Trading Profit, and
Trading Margins, 197380
21 ICI Direct Labour on Billingham and Wilton Sites, 1973
22 Employment Growth on the Wilton Site, 194657
23 Plastics Group Worldwide: Sales, Trading Profit and Trading
Margins, 197380
24 Plastics Sector of ICI: Geographical Split of Sales and Production,
1978
25 Plastics Division UK Employees, 196581
26 UK General Chemicals Sales Estimated
27 ICI General Chemicals Worldwide: Sales, Trading Profit, and Ratio
of Trading Profit to Sales, 197383
28 Mond Division Manpower Numbers, 196483 (May)
29 Mond Division Manpower Numbers, End 197983 (May) Allowing
for ICI UK Structural Changes
30 Percentage Contribution to ICI Group Sales: by Territory
31 ICI Record of Sales, Profits, and Ratio of Trading Profit to Sales in
Peak and Trough Years, 195882
127
138
138
218
222
224
264
265
279
325
326
3 71
372
414
447
Acknowledgements
This book is the result of research carried out over the 8-year period from 1975
to 1983. I am extremely grateful to all the people in Imperial Chemical
Industries (ICI) who have helped me over that period gather, sort, analyse, and
write up this material.
ICI is a very complex set of businesses linked together in the UK in divisional
organisations with quite different organisational histories and cultures. How-ever, even with all this cultural diversity ICI has had elements of a common
company culture which at various times could be described by adjectives such
as technological, stable, conservative, caring, intellectual, and in certain of its
spheres of operation open to the outside world. For all its inevitable
hierarchical tendencies ICI can also be described as being made up of a series
of loosely linked networks of people who have coalesced around their interests
in operating at a certain level in each division, for example, division chairman or
works manager, and across the company in functions such as engineering and
personnel.
The process of how I gained the quality of access to ICI which was necessary
to build up the picture in this book is itself a complex and fascinating story, but
without doubt the open and intellectual side of ICI's character helped in
gaining access and so did the understanding of its networks of formal and
informal association. The mixed role that I have played in the company as a
researcher, consultant, and trainer may also have helped me to gain access to
people and appreciate situations and dilemmas in a wider fashion than if I had
defined my role just as a researcher, or a consultant, or a trainer. Effective, or
merely adequate research on any sphere of life has surely to be a mutual process
where the need to balance involvement and distance, is a critical part of the
process, (Pettigrew, 1983b).
Paul Miles , then of Agricultural Division, first suggested that I might
consider carrying out a study of the use of organisation development expertise
in his division. Prompted by the suggestion that a comparative study across
several divisions might be more instructive, Miles, Simon Dow, and Tom James
set up the necessary access to Agricultural, Plastics, and Petrochemicals
Divisions, and Stewart Dudley opened the gate into Millbank and the organis1
Throughout this volume all personal names mentioned are pseudonyms. The only
exceptions to this are the ICI company chairmen, who are nationalfiguresin the UK
context and therefore impossible to disguise.
Acknowledgements xv
ation development work which had been going on from the base of the then
Central Personnel Department. ICI supplied a research grant for 2 years to
carry out this initial work, and Dr Dennis Bumstead joined me at the London
Business School in September 1975 as a full-time researcher.
However, the research reported here is more than just an analysis of the
differential impact in various organisation contexts of organisation develop-ment (OD) activities on organisational change, it also seeks to ask some much
broader questions about the patterns of continuity and change in ICI over the
period 196083; and the role of very senior line managers in creating change.
The changes in the character and objectives of this research which occurred
after 1977 are a recognition of the useful though always limited role that
internal and external specialist OD resources have played in formulating and
implementing organisational change in ICI. By the late 1970s there was an
open statement of company policy in ICI that line managers were to be the
vanguard of the significant changes which occurred from 1979 onwards. I am
extremely grateful to the main board directors, division chairmen and directors,
senior managers, internal and external consultants, and senior shop stewards
who allowed me to interview them and provided documentary evidence of some
of the strategic change processes going on in the company over the period
196083. Particular thanks are due to Stewart Dudley and Tom James for their
consistent help and practical advice throughout the period 197583, and to
John Harvey-Jones for helping to create the space and climate where this
research work could be done.
I gained access to Mond Division relatively late in the day of this study, and
just as well because the Mond story of change is a critical one within recent ICI
experience. Nicholas Mann, Mark Warwick, Dylan Jones, and Sandy Marshall
were a great help in enabling me to appreciate the complexities and significance
of the Mond work.
Present members of the Petrochemicals and Plastics Division board, and
indeed a number of senior managers and senior shop stewards at Wilton may
rightly ask "what's happened to the story of the merging of Petrochemicals and
Plastics Divisions and to the analysis of the major changes on the huge
manufacturing site at Wilton since 1979?" My answer to that question is that
those processes of managing change are too important and interesting to have
squeezed them into what is already a long book, and the analysis of the
implementation of the Petrochemicals and Plastics Division merger and the
Wilton changes since 1979 will appear in subsequent publications. Neverthe-less I would like to acknowledge here the support for this research given so far
by a number of people in Petrochemicals and Plastics Division.
Although I have carried out the research largely without continuing financial
research support and research assistance, a number of individuals and organis-ations have helped me throughout the period 197583. ICI's initial financial
support allowed me to recruit Dr Dennis Bumstead to work on the research,
and between late 1975 and late 1977 he successfully carried out a lot of the
interviewing and analysis for the studies of the impact of OD in Agricultural
and Petrochemicals Divisions, and in Central Personnel Department in
xvi
Acknowledgements
Preface
The unfolding of economic events during the 1970s and early 1980s has drawn
further attention to the relative decline of the British economy and the
continuing loss of competitiveness of large sectors of British industry. In the
search for explanations of Britain's declining competitiveness a multiplicity of
factors have surfaced. Pollard (1982) has emphasised the short-term focus of
British economic policy-making and our failure as a nation to invest in the
modernisation of capital equipment. Researchers at the Science Policy
Research Unit at Sussex University also dwell on the relationship between
technical innovation and British economic performance, pointing to shortcom-ings in the way certain sectors of British industry develop and improve products
and production processes (Pavitt, 1980). Meanwhile economists such as Caves
(1980) and Blume (1980) identify the poorer productivity of certain UK
industries compared with their US equivalents, and how the UK's financial
structures and institutions inhibit our ability to direct savings into appropriate
investment channels. The problem of explaining Britain's economic decline has
also attracted scholars interested in taking a very long-term view. Wiener
(1981) digs into the culture and class system in British society, arguing that
there has been a systematic misdirection of talent in Britain into public sector
administration, the City, and the universities and away from industry and
engineering. Lazonick (1983), on the other hand, argues that the decline in
Britain's economy during the twentieth century is due to structural rigidities in
its economic institutions that developed in the nineteenth century era of
relatively free competition.
But is Britain's declining competitiveness just to be explained by a mixture
which includes national economic policies, macro-economic variables, the
deep-rooted social and cultural biases of UK society, the peculiarities of our
financial institutions and our tax system, and the patterns of trade union activity
and industrial relations? I think not. Given the substantial changes in the
economic, political, and business environment of large firms over the past two
decades, a critical factor affecting the relative competitive position of British
firms must be the capacity of firms to adjust and adapt to major changes in their
environments and thereby improve their competitive performance. The import-ance of these adjustment and adaptation processes suggests that the nature of
management itself is a crucial input into the competitiveness issue. Part of the
management task is to identify and assess changing economic, business, and
political conditions, and formulate and implement new strategies to improve the
firm's competitive performance. These managerial processes of strategic
xviii Preface
assessment, choice, and change are not just questions of economic calculation
of strategic opportunity carried out by men and women driven by rational
imperatives. The process of assessing environmental change and its implica-tions for new strategies, structures, technologies, and cultures in the firm is an
immensely human process in which differential perception, quests for
efficiency and power, visionary leadership skills, the vicariousness of chance,
and subtle processes of additively building up a momentum of support for
change and then vigorously implementing change, all play their part.
This volume explores one of the key theoretical and practical problems of
the 1980s, how to create strategic and operational changes in large, complex
organisations. The theme of managerial processes of creating change is
interwoven through a detailed empirical study of one of Britain's largest
corporations and its response to the changing environment of the past 20 years.
It should be clear this study does not deal with the activities of all ICI''s UK
divisions, neither is this an officially commissioned history of ICI, although an
important feature of the research has been the high level and high quality of
research access provided by ICI. The research examines ICI's attempts to
change their strategy, structure, technology, organisational culture, and the
quality of union management relationships over the period 196083. An
important and unusual feature of the research strategy has been the collection
of comparative and longitudinal data. Interview, documentary, and observ-ational data are available from ICI's four largest divisions Agricultural, Mond,
Petrochemicals, and Plastics and from the corporate headquarters. These
data have been assembled on a continuous real-time basis since 1975, through
retrospective analysis of the period 196074, and in the case of the divisional
chapters by probing into the traditions and culture of each division established
long before the last two decades.
The study explores two linked continuous processes. Initially the focus of
the research was to examine the birth, evolution, demise, and development
of the groups of internal and external organisation development consultants,
employed by ICI in order to help initiate and implement organisational change.
This analysis of the contributions and limitations of specialist-led attempt to
create change, has led to the examination of broader processes of continuity and
change in ICI as seen through the eyes and actions of the main board, divisional
boards, and senior managers of ICI. The book therefore contributes to
knowledge about the part played by very senior executives in corporate-wide
strategic changes, the role of divisional boards and directors in making divisionwide changes in structure, organisational culture and manpower, and the
influence of specialist change resources of the internal and external variety in
making changes happen. Throughout the book the emphasis is on describing
and analysing processes of change in context, illustrating why and how the
content of particular changes and the strategies for introducing them are
constrained by and enabled by features of the traditions, culture, structure, and
business of ICI as a whole and each of its divisions, and by gross changes in the
business, economic, and political environment ICI has faced through time.
The findings of this research on ICI reinforce those writers who have
Preface xix
discussed the inertial properties of organisations and the enormous difficulties
of breaking down the established ways of looking at and behaving towards the
world which develop in large organisations. Once a large organisation develops
a coherent strategy of how it is going to deal with its external environment, and
that strategy is reinforced by the structures, systems, cultures, and political
constraints of the organisation, the dominating ideas and assumptions which
are implicit and explicit in the strategy it behaves are extraordinarily difficult to
break down. Thus when strategic change does occur it tends to occur in radical
packages revolutionary periods interspersed with long periods of absorbing
the impact of the radical changes, of further periods of incremental adjustment,
and then a period of education, persuasion and conditioning leading up to the
next revolutionary break. In the ICI cases reported in this book the periodic
eras of high levels of change activity were precipitated by, but not solely
explained by, economic and business-related crises. Behind these periodic
strategic reorientations in ICI are not just economic and business events, but
also processes of managerial perception, choice, and action. The book provides
ample illustrations of the role of executive leadership in intervening in the
existing concepts of corporate strategy, and using and changing the structures,
cultures, and political processes in the firm to draw attention to the need for
change, and lead the organisation to sense and create a different pattern of
alignment between its internal character, strategy, and structure and the
emerging view of its operating environment.
The book has twelve chapters. Chapter 1 presents a detailed and pointed
review of the strengths and weaknesses of existing research on organisational
change, organisation development, and strategic change, and thus places the
book alongside the three bodies of academic literature connectable to the
empirical themes of this research on ICI. Chapter 2 builds on one of the central
conclusions of the first chapter, the fact that so much of the previous research
on change in organisations has been ahistorical, acontextual, and aprocessual,
and describes the particular brand of contextualist and processual research
favoured in this study. Chapter 2 also describes the political and cultural view of
organisational process behind this research, and the methodology and study
questions in this piece of work.
Chapter 3, 'ICI in its Changing Business and Economic Context' is a
descriptive account of the major trends in the world and UK chemical industry
over the past two decades, ICI's broad corporate response to that changing
environment, and ICI's business performance over the past 20-plus years
compared with its major US and West German competitors.
Chapter 4 begins the process of describing and analysing the use, impact,
and fate of organisation development (OD) consultants in ICI. It describes the
birth of the central OD resources in the company, and the role those resources
played in seeking to justify and implement productivity changes in ICI from the
mid-1960s until about 1972. From a company point of view this chapter
illustrates the difficulties created when changes fashioned at the company
headquarters are thrust upon disinterested and at times recalcitrant divisions.
Chapters 5 and 6 describe and analyse the origins and development of ICI's
xx Preface
agricultural chemical interests at Billingham in the north-east of England. The
latter part of Chapter 5 describes in some detail the attempt made by George
Bridge the personnel director of Billingham Division (as it was known as then)
to open up the management culture at Billingham to change, and in so doing to
create a new pattern of relationships between management and worker on the
Billingham site. Bridge's era of social innovation at Billingham was built on by
the OD resources that were created there from 1969 onwards. Their organic
bottom-up strategy for creating change in the climate of industrial relations on
the site and for improving the processes of commissioning new plant was in
stark contrast to Bridge's bow wave of change. Chapter 6 chronicles the organic
change strategy of the Agricultural Division OD group and their line manager
clients, and takes the story of the use of OD assistance on the Billingham site
right up to the quite different business, economic, and political conditions of
1984.
Chapter 7 describes the substantially different business history and manage-ment and shop floor culture that developed in Petrochemicals Division, just
10 miles away from the Billingham manufacturing site. Chapter 7 reveals a
different context for organisational change and development, and an evolution-ary pattern of using OD resources in Petrochemicals Division which was totally
different from the Agricultural Division experience. Chapter 7 also illustrates
the strengths and limitations of an enforced strategy of change propagated by
the Petrochemicals Division Chairman of the early 1970s.
Chapter 8 chronicles the enormously difficult task of using specialist OD
change resources in the top management structure and culture that developed
in Plastics Division during the 1960s and 1970s. Chapters 9 and 10 offer an
important contrast to the absence of change in Plastics Division. The Mond
Division chapter chronicles how and why a succession of powerful people on
the Mond board, with the assistance of internal and external OD resources,
were able to change the process of working on the board, the way the senior
managers in the division assessed and dealt with environmental change and
industrial relations problems, and eventually build up a coherent view of how
the structure, strategy, and manpower of the division should change and did
change to meet the harsher business conditions of the post-1979 period.
Chapter 10, 'Strategic Change and Organisation Development at the Centre
of Power: 197383' is a rare look at the processes of top decision-making and
change in a major British firm. The chapter describes the long, additive,
conditioning process which was necessary to produce the major ideological,
structural, and strategic changes which eventually materialised in ICI from
about 1979 onwards.
Chapters 11 and 12 try and draw together some of the threads from this
account of continuity and change in ICI. Chapter 11 compares and contrasts
the five cases of strategic change reported in the book, and relates the patterns
evident in those processes of change to the literature in organisation theory,
business strategy, and business history which has discussed the what, why, and
how of the evolution of the firm. This chapter also discusses the practical
Preface xxi
messages about the management of strategic change to be derived from the ICI
experience.
Finally Chapter 12 compares and contrasts the natural history of develop-ment and impact of the various groups of internal and external OD consultants
who worked in the corporate headquarters and Agricultural, Mond, Petro-chemicals, and Plastics Divisions. This chapter also reviews the practical
management lessons to be derived from ICI's use of internal and external OD
consultants.
ing and worthwhile in the sharpening of academic minds and egos, are
ultimately pointless. For the analyst interested in the theory and practice of
changing the task is to identify the variety and mixture of causes of change and
to explore some of the conditions and contexts under which these mixtures
occur. That at least is the first stepping stone I offer the reader for joining me
on this particular enterprise.
This research on continuity and change in ICI has provided an opportunity
to study in a comparative and longitudinal mode the activities and strategies of
very senior and middle managers trying to create significant change, and the
role of internal and external organisation development (OD) specialists in
facilitating change. The study began in 1975 after ICI had been using specialist
OD resources at a variety of different levels and divisions in the company, and
were pondering particular questions about why and how these specialists
seemed to be more effective in some parts of the company than others. From
this initial pragmatic question the research began to explore and establish the
first theme in this book the contributions and limitations of specialist-based
attempts to create changes in organisational structure and culture. The first
process under examination in the research has been the birth, evolution,
development, and impact of groups of internal and external OD consultants in
four divisions, and the corporate headquarters of ICI. However, as a result of
the access and analyses provided by the initial study objectives the opportunity
arose to explore a second and more inclusive process, the long-term processes
of strategic decision-making and change in ICI in the differing social,
economic, and political context of 196083. The use of the word strategic
linked to change is just a description of magnitude of alteration in, for example
product market focus, structure, and organisational culture, recognising the
second-order effects, or multiple consequences, of any such changes. This
second, broader analysis of continuity and change is seen through the eyes and
activities of the main board of ICI, and the boards and senior managers of ICI's
four largest divisions Agricultural, Mond, Petrochemicals, and Plastics.
Given that the completed study incorporates an analysis of senior executive
and specialist contributions to the process of formulating and implementing
changes of such scope and impact that they can justifiably be described as
strategic; and examines the role of line managers and specialists grappling with
the introduction of more localised and circumscribed changes; and that OD
techniques and ideas were applied to both the strategic and the more limited
changes, then it is evident the data in this study are potentially connectable to a
number of the various elements of the literature on the management of change.
Unfortunately the writing and research on the management of change is a
sprawling and none too coherent collection of bodies of literature, some
proclaiming pragmatic precepts and transparent values, others coolly analysing
and theorising without any commitment to statements of practice, and others
being concerned with the lofty analytical formulation of strategic change and
disdaining the examination of how such strategies are to be implemented in the
political and cultural mosaic of large and medium-sized organisations. Of
The immediate theoretical and empirical context in which the present research
places itself is the research and writing in the related fields of organisational
change and development. Organisation development (OD) has almost as many
definitions as it has practitioners. Thus, Bennis (1969:2) talks of OD as "a
response to change, a complex educational strategy intended to change the
beliefs, attitudes, values and structure of organisations", while French and Bell
(1973:15) emphasise the long-range problem-solving and renewal process
objectives that OD denotes to them. Alderfer (1977) meanwhile sees OD both
as a professional field of social action and an area of academic study, and
emphasises its dual value objective in improving the quality of life for members
of human systems and increasing the institutional effectiveness of those
systems. Beckhard's (1969:9) definition perhaps best captures the idealized
scope that people in the 1960s had for OD.
Organisation development is an effort (1) planned, (2) organisationwide and (3)
managed from the top, to (4) increase organisational effectiveness and health
through (5) planned intervention in the organisation's processes using behavioural
science knowledge.
There have been a number of comprehensive and useful efforts to chronicle the
origins of OD (French and Bell, 1973; Greiner, 1977); and to analyse the
emergence of certain parts of its technology (Back, 1972); and its values
(Tannenbaum and Davis, 1969; Solomon, 1971; Friedlander, 1976). While this
is not the place to effect another broadly based survey of the history of OD,
given the empirical side of this book closely mirrors a good portion of that
history, it is important to examine the ICI experience in the light of the wider
development of the field. In addition, exploring its history is a further window to
look through in attempting to specify what OD actually is.
The term OD appears to have originated in the United States in the late
1950s possibly by Blake, Shepard and Mouton while they were co-operating on
a series of OD experiments at three Esso refineries: Bayonne, Baton Rouge,
The most detailed account of Kurt Lewin's life and influence is Marrow's book (1969),
Practical Theorist.
Greiner's (1977) dates refer to the American experience of OD, the ICI
experience followed a broadly similar pattern but in a different historical time
frame. In discussing the birth of OD, I have already described Greiner's stage
1. The second stage was in some sense a response to questioning of the
practical value of T-groups. Blake in particular turned his back on T-groups
after the Esso experience, feeling that they did not produce lasting results in the
back-home organisation, relied too much on external consultancy help, and
excessively stressed human relationships over task performance (French and
Bell, 1972; Greiner, 1977). Blake's response was the first and probably most
successful of the 1960s packages, the managerial grid (Blake and Mouton,
1964). This was a multi-phase programme focusing on managerial style which
integrated people with task accomplishments and which could be run without
Blake's presence. Blake and Mouton left their university posts and set up their
own company, Scientific Methods Inc. They were reputed to be dollar
millionaires by the end of the 1960s. Other packages by Reddin (1967) and
Likert and his colleagues (1961) also emerged at this time.
The late 1960s was a period of evaluation and doubt. Managers and
academics began to question the utility of many of these person-centred
organisational interactions on pragmatic and moral grounds. An academic
industry developed at this time critically evaluating not only the T-group's
ability to produce behaviour changes (Campbell and Dunnette, 1968; House,
1967), but also the methodological standing and conceptual base of the
motivation and job enrichment ideas of Herzberg et al.2 (1959, and Herzberg
1966). Perhaps more to the point, in a survey of OD activities in 149
companies, Rush (1973) noted that the 196970 economic recession took its
toll on several company OD efforts.
Greiner (1977) describes the early 1970s as a period of pragmatism and
eclecticism. Having had their fingers burnt by some of the general packaged
solutions of the 1960s, the inability in many specific situations to link, in
managers' minds, people with productivity through devices such as job
enrichment and team-building, many OD consultants, internal and external,
turned to the more pragmatic and less person-centred intellectual approach in
structural contingency theory. There was also a feeling that "anything that
works" is worth hearing about (Greiner, 1977:72). And so the early and mid1970s saw a burgeoning of new labels, new technologies, and new settings to
2
For criticisms of the Herzberg approach, see House and Wigdor (1967).
Having tried to define OD, questioned the value of merely using the espoused
theories of OD practitioners as expressed in their writing as a base on which to
build this research, and then given some form to our discussion by describing
and characterising the origins and development of OD, there remains the task
of examining the strengths and weaknesses of existing research on organis-ational change and development. In what follows I shall spare the reader the
pain of completeness for completeness' sake. Instead my objective will be first
of all to mention the styles and perspective which some of the review papers in
this area demonstrate, then to discuss some of the comparative research which
assesses the impact of OD interventions, and then follow this with a critical look
at a few of the more solid autobiographical accounts of change which exist.
Finally, an exploration of the rare studies which have elements of a longitudinal
design, and contextual and process analyses of change, will reveal something of
the theoretical and methodological cornerstones behind the design and conduct
of this research.
Of the current review papers examining the field and practice of OD, there
seem to be three main styles of presenting the literature. There is the
descriptive and interpretative approach of Friedlander and Brown (1974) and
Alderfer (1977), the evaluative approach of Kahn (1974), Stephenson (1975),
and Strauss (1976), and the scientific rigorous perspective adopted by White
and Mitchell (1976), Porras and Berg (1978), and King, Sherwood, and
Manning (1978). Not surprisingly, the descriptive approach is the most
informative, the scientific the most precise and predictable, and the evaluative
the most interesting to read.
10
With the exception of Klein (1976) and Warmington et al. (1977) most of the
studies of change which have been mentioned so far in this review have been
ahistorical, acontextual, and aprocessual. This is the tradition in the field and
even Klein (1976) and Warmington et al. (1977) while contextual in part do not
draw on historical materials or provide a processual analysis of change. As with
so many other areas in the social sciences the empirical findings and theoretical
developments in the field of organisational change are method-bound. For as
long as we continue to conduct research on change which is ahistorical,
acontextual, and aprocessual, which continues to treat the change programme
as the unit of analysis and regard change as an episode divorced from the
immediate and more distant context in which it is embedded, then we will
continue to develop inadequate descriptive theories of change which are illcomposed guides for action. Indeed as I have implied already there is still a
dearth of studies which can make statements about the how and why of change,
about the processual dynamics of change, in short which go beyond the analysis
of change and begin to theorise about changing.
These analytical issues, and the way they are represented in the field, are not
black and white. There are alternative ways of defining longitudinal research
each of which has different implications for whether a processual analysis
actually appears from the longitudinal data. An examination of the Bowers
(1973) work illustrated how time series data, if collected in a snapshot fashion,
would not provide a processual analysis, and how even though Franklin (1976)
had data which were amenable to processual analysis he chose to use those data
to abstract out cross-sectional categories and factors. Equally well single case
study longitudinal work such as Alderfer and Brown (1975) which explicitly
uses the term changing as a focal point for the study is actually limited by not
being able to relate variability in context to alternative processes of changing.
And the important paper by Greiner (1967), which proclaimed the importance
of historical analysis and the significance of antecedent conditions in explaining
the limitations and possibilities of change, was itself hampered by not being able
to relate alternative antecedent conditions to common or variable contexts, and
thence to differing resultant change outcomes.
A further area of research which has attempted to provide contextualist
propositions about change is the literature on innovation (Zaltman, Duncan and
Holbeck, 1973; Kimberly, 1981). This literature, either by defining innovation
as a discrete product or programme (Rogers and Shoemaker, 1971), or as a
process (Knight, 1967; Shepard, 1967), has attempted to disentangle the vari--
One of the analytical conclusions of this study is that theoretically sound and
practically useful research on strategic change should involve the continuous
interplay between ideas about the context of change, the process of change, and
the content of change, together with skill in regulating the relations between the
three. Formulating the content of a strategic change crucially entails managing
its context and process. Without sensitivity to and apposite action on the what,
the why, and the how of introducing major change more than likely the change
idea will either die shortly after birth or be emasculated at later stages in the
processes of formulation and implementation.
But what has the existing literature on strategic change to say about either the
content, the context, or the process of managing change? In fact the general
literature on business strategy development almost exclusively concerns itself
with the content of strategy, while treating context in terms of the crucial but
still limiting notion of the competitive environment of the firm (Andrews, 1971;
King and Cleland, 1978; Porter, 1980). Even more problematic, however, is the
implicit view of problem-solving built into this strategy literature which is as
rational as, if not more rational than, the view of choice and change found in
parts of the writing on innovation and planned organisational change discussed
in the previous section of this chapter. Thus as applied to the development of
business strategy the rational approach describes and prescribes techniques for
identifying current strategy, analysing environments, resources and gaps,
revealing and assessing strategic alternatives, and choosing and implementing
carefully analysed and well-thought-through outcomes. This rational picture of
business problem-solving has as its concern the content or what of strategy
the outcome which is sought and has nothing to say at an explicit level of how
to achieve that outcome. In other words it has no process theory within it of how
and why to create the strategic outcomes so perceptively and logically derived
from the analysis of competitive forces.
But what are the potential sources available to try and develop an adequate
theory of strategic change which incorporates thinking about the process of
managing change? The organisation development literature has rarely been
used to inform thinking about strategic change, even though recent writing by,
for example, Beckhard and Harris (1977) and Beer (1980) could be used with
profit to grapple with some of the practical problems of creating and managing
strategic change. Perhaps another route to stimulate process theorising about
strategic change is to draw on the work of authors such as Bower (1970),
Allison (1971), Pettigrew (1973), Mumford and Pettigrew (1975), March and
Olsen (1976), Mintzberg (1978), and Quinn (1980), who at least at the level of
observation and description, if not always prescriptively, have sought to rescue
research on strategic choice and change from its habitual focus on rational
analytical schemas of intentional process and outcome, and to see decisionmaking and change in a variety of process modes.
We have Simon (1957) and March and Simon (1958) with their concepts of
20
bounded rationality and satisficing to thank for highlighting how the cognitive,
learning and search limitations of individuals can curtail maximising models of
rational choice. However, March and Simon's (1958) tendency to project
individual processes of choice into statements about organisational processes of
decision-making means there is a liberal bias to reconstructing the organisation
from the perspective of the individual, and not enough on demonstrating how
the organisation structures the perspective and interests of the individual. No
such theoretical fallacy is evident in Cyert and March (1963). They also
conceive of a firm as a goal-directed, economising and learning individual but
extend this view by conceiving of decision-making as a political process. In
Cyert and March (1963) conflicts of interest are normal features of organis-ational life, coalitions form, and sub-groups work to generate support for their
interests and demands. But although some of the language of political analysis
is present in Cyert and March, and there is the prospect that power may cause
decision outcomes, the theoretical apparatus to help describe and analyse how
political processes cause choices to be made is absent.4 As Pfeffer (1982:7) has
recently argued, implicit in the bounded rationality approach was the normative
position that the bounds of bounded rationality could actually be pushed back if
new decision technologies or information processing systems could be
developed. In this way technology could compensate for the limited cognitive
and information processing abilities of man, and more rational action would
result.
Another group of scholars also interested in descriptive and prescriptive
approaches to choice were the policy analysts (Lindblom, 1959; Braybrooke
and Lindblom, 1963). In the complex and unpredictable world of macropolicy-making, how again could boundedly rational decisions be made under
time constraints and where search costs were limited? The answer was through
methods of successive limited comparisons in which policy-makers would move
incrementally from the base line set by practice and precedent. Here again,
presumably under the long shadow of the public interest, policy analysts are
implicitly trying to be as rational as they can given the difficult contexts in which
they operated, and the complex problems they had to solve.
Eventually the process theorists started to take an interest in strategy
formulation in business settings where the dominant intellectual paradigm was
a combination of a preoccupation with the analytical content of strategy with
limited views of context, and an avowedly rational picture of business problemsolving (Ansoff, 1965; Andrews, 1971). Without necessarily over-identifying
themselves with any of the particular process theories then emerging, writers
such as Bower (1970) and Mintzberg et al. (1976, 1978) began to treat strategy
not as an output but as a process, and confront the dominant rational/analytical
paradigm with the results of their descriptive studies. Bower (1970), like
Aharoni (1966), conceived of strategy developing at multiple levels in the
organisation through processes characterised as chains of commitment leading
4
See Pettigrew (1973) for an elaboration of these reflections on the Carnegie decision-making scholars of the 1960s.
BEARINGS
24
change has a particular beginning and a finite ending apart from the more
generalised processes around it. Regrettably this perspective still abounds today
both in recent literature examining quality of work life changes (Goodman,
1979), and in that part of the OD literature which condenses organisational
change processes down to the minutiae of relationships between consultant and
client (Mangham, 1979; McLean et al., 1982). The literature on consul-tantclient relationships will be discussed in more detail at a later stage of this
book as empirical material is being presented about the attitudes and behaviour
of the ICI internal and external consultants. The consultancy literature is,
however, yet another example of the prescriptive, rather idealised character of
the change field (Blake and Mouton, 1976; Steele, 1975), and of a subset of
that field focusing in on the change process from a highly limited frame of
reference. Even fairly circumscribed attempts to demonstrate how consultant
consultant relationships might influence consultant-client relationships, (Pettigrew, 1975b), and how the strategic management of consultant groups
influence change processes, (Pettigrew, 1975a), bring in levels of analysis rarely
alluded to in the myopic concern with how consultant relates to client.
Aside from the above problems of limited focus, the above review has also
pinpointed the inadequacies of the highly rational and linear process models
which drive most planned theories of change and the literature on business
strategy development. These planned theories, many of them with highly
prescriptive and deterministic phases or stages (Lippitt et al., 1958; French and
Bell, 1973), are, as we shall see, divorced from the actual conduct of change
projects and processes. For the task of examining how strategic change actually
takes place and some of the dynamics behind those change processes we will
have to draw upon some alternative models of process (Pettigrew, 1973, 1979;
Quinn, 1980) which are able to explain how the possibilities and limitations of
change in any organisation are influenced by the history of attitudes and
relationships between interest groups in and outside the firm, and by the
mobilisation of support for a change within the power structure at any point in
time. Such a view of changing does not carry along with it either the ideological
baggage of progress identified by Kimberly (1981) in the literature on
managerial innovation, or the necessity to see change just as a response of
management to improve efficiency, but rather is capable of interpreting change
as the legacy of struggles for power emerging through time.
Mindful, however, of my earlier admonition to beware of singular theories of
changing, no attempt will be made here to simply substitute planned, rational
linear theories with political process theories. The task is to identify the variety
and mixture of causes of change, to examine the juxtaposition of the rational
and the political, the quest for efficiency and power, the role of exceptional men
and of extreme circumstances, the untidiness of chance, forces in the
environment, and to explore some of the conditions in which mixtures of these
occur.
This leads me to pick up the two final areas where particularly the OD and
organisational change literature were found wanting, their use of contextual and
processual forms of analysis and explanation. In this author's view the study of
A central conclusion of the previous chapter was that the theory and practice of
change in organisations would continue to remain as circumscribed and illdeveloped as it has been for as long as change is studied and thought about as
episodes and projects separate from the ongoing processes of continuity and
change of which those change projects are a part. The episodic, or project and
programme, view of change has treated innovations as if they had a clear
beginning and a clear end and divorced change not only from its antecedent
conditions, but also from the more immediate and distant context which
supplies the enabling conditions for the changes' birth, a framework of
opportunity and constraint to guide its development and continuing legitimis-ation; and possibly still further conditions to bring about the demise of the
change. Implicit also within this acontextual treatment of change, has been the
failure to ask the kind of how and why questions about the dynamics and
processes of innovation from which would emerge empirical patterns and
theoretical propositions not just about change, but about the patterns and
dynamics of changing. These methodological and analytical omissions and their
theoretical and empirical consequences add up to rather more than a discussion
of scholarly niceties; they also have had a profound impact on the practice of
change. Nord (1974:567) has made this point with some eloquence: "the
impotence of the modern human resource management strategies stems, at
least in part, from the failure of their adherents to recognize that their own
givens are the same forces which produced and continue to sustain the situation
they wish to change." A major objective of this research on change in ICI is to
use the available depth of contextual data, and extended sequence of longi-tudinal data, in order to offer a comparative analysis which provides an
expanded focus on changing, which gives a central explanatory place to many of
the givens in the existing research on change. Chief amongst these will be the
role of business and economic factors outside the firm and historical, cultural,
and political processes inside the firm, together with the interplay between
those two sets of contextual variables, as providers of both the necessary and
sufficient conditions for continuity and change.
The central, guiding theoretical influence on this research is the author's
continuing work on organisations as systems and subsystems of political action
28
Even a cursory glance at recent academic journals and books in the linked fields
of organisation behaviour and theory indicates there is a growing industry of
criticism. (Benson, 1977a; Clegg and Dunkerley, 1977; Weinstein, 1979;
Salaman, 1979). Some of these critics follow familiar enough paths. Thus
Weinstein (1979) asserts that while covering their pronouncements and
theories in the sheep's clothing of organisations as purely neutral administrative
entities, most organisation theorists adopt the problems and perspectives of
management as a predominant bias. Clegg and Dunkerley (1977:3) meantime
attack organisation theory for its simple-minded positivism, where organis-ational life ends up being "analyzed, paralyzed, and reduced to a series of
quantifiable variables". Roberts et al. (1978:136) take up and extend the
positivist theme: "The continued emphasis on narrower and narrower views of
responses made by individuals in organisations, concentration on individual
differences to the exclusion of environmental effects, or concentration on
organisational variables to the exclusion of individual differences or societal
variables, will generate more precise knowledge about increasingly trivial
matters". Meanwhile Crozier and Friedberg (1980:2) with true French elan
criticize the cross-sectional statistical methods of American organisational
sociologists, the crude attempts to develop organisational laws, the unduly
deterministic nature of structural contingency theorists, and the inappropriate-ness of American theorising and about organisation, first of all for French
conditions, and then for American organisations as well!
Now even the above collection of gratuitous swipes have their value, not just
because of the kernel of truth which exists in them all, but because they
represent an attempt to begin a critical tradition in organisational analysis where
none has existed before. If organisation theory is to emerge from a period of
self-questioning of the kind which wonders how much of value do we know
about organisations after the last 20 years of research, and a feeling that while
30
could be restated and empirically examined outside the logic of this simple
determinism. Salaman (1979) offers no theoretical language or logical argu-ment of why and how societal and intraorganisational power and political
processes are interrelated. Where is the discussion of processual and structural
mechanisms through which power outside is connected to power inside the
organisation?
Yet before using this particular example of the analysis of power relationships
as a vehicle for deflating Marxist attempts to bring society back in, we should
consider more seriously the role of the societal level of analysis, for it is in
highlighting the importance of social and economic determinants that the
Marxist theoretical position has the most to say of value for the future
development of organisational analysis.
Wassenberg (1977) has argued that in spite of the contribution that the
famous three (Durkheim, Marx, and Weber) have made to the analysis of
organisations, and in the main through forms of conceptualisation that was
sensitive to social and economic forces, organisation theory has gradually lost its
analytical capacity and interest in the impact of social and economic forces on
organisational functioning. Wassenberg (1977) backs up this broad statement
by the pertinent observation that what better example of the isolationism of
organisation theory can one find than its inability to comment on how the post1973 economic depression affected the political and economic context of
organisational functioning. A central precept within this concern with social and
economic forces is the Marxian concept of totality. Transferred to the study of
organisations this implies that organisations can only be understood after the
total social formation which provides their raison d'etre is conceptualized. For
some Marxian influenced scholars this puts in doubt the very existence of the
organisation as a unit of analysis, although paradoxically most of the authors
who would have us abandon the ontological status of the organisational level of
analysis, are quite happy to continue to use the term organisation even in the
title of their books (Clegg and Dunkerley, 1977, 1980).
But given the primacy of social and economic forces, what kind of novel
questions and topics emerge for examination? For Clegg and Dunkerley (1980)
the expressed need is to locate the analysis of organisation process within a
general theory of class structure, state power, and world capitalism. For Esland
and Salaman (1980:1) the agenda for analysing
the politics of work in capitalism insists on the relationship between work
structures and events, and the structure of interests and power and values in the
society at large. It analyses the role of ideology in mystifying and buttressing work
hierarchies and irregularities. It seeks to discover the interests that lie behind the
claimed rationality and neutrality of much work-based deprivation. Most
important of all, it retains and applies a sense of outrage.
So the traditional, and admittedly often bland, treatment of organisationenvironment relationships within organisation theory in terms of inputs,
32
This notion of history and change behind men's backs is too much for Berlin
(1974:164)
the puppets may be conscious and identify themselves happily with the inevitable
process in which they play their parts; but it remains inevitable, and they remain
marionettes.1
However,as many scholars have noted, Marxism has long overtaken Marx,
and there are now a plethora of Marxist alternatives, some of whom for
example Althusser (1969) and Bukharin (1965) continue to assume that
actions and historical events are determined fundamentally by the social
formations in which they are located, while others for example Salaman
(1979) attribute less weight to the ownership of the means of production,
acknowledging in the face of empirical reality that variations occur between and
within capitalist societies, regions, and even particular industrial plants.
This recognition of the variable expression of capitalist influences in differing
contexts has not been picked up and analytically utilised by those scholars who
explore two of the other key themes in the Marxist problematic, the role of the
world system and the state, in creating hegemony. According to Wallerstein
(1974), not only has capitalism pervaded the social and organisational life of
Western societies, it has also become a world system, "an expressed totality, in
which each nation is subordinated to and devastated by the expansion of
capitalism" (Burawoy, 1978:52). The state has appeared as a macro-level
variable in Marxian analysis to help to explain, or rather account for, the lack of
appearance of the Marxist prognosis of the demise of capitalism and the rise of
socialism. Thus when the market begins to fail under monopoly capitalism, the
state appears to buttress the capitalist system (O'Connor, 1973). Appealing as
the notion of a world system may be, and pertinent as state intervention may
appear from observing events in many European countries in the 1960s and
1970s, the problem with such categories in Marxist analysis is the crude way
they are defined and the unitary and deterministic fashion in which they are
applied in analysis. Thus, the term "world system" is applied in a unitary
fashion in such a way as to ignore the uneven development of capitalism, and
the role of factors like nationalism in responding to and resisting the
development of capitalism. One has some sympathy with Crozier and Friedberg
(1980:215) when they criticise "simplistic, mechanistic, overly deterministic
and rigid formulas which try to compress a whole economic or social system
into a phrase".
Burawoy (1978:58) is equally adroit in pinpointing the unsatisfactory
functionalism in most interventionist theories of the state. "A crisis is identified,
a functional gap discovered, a contradiction revealed, and the state is invoked as
the agency of restoration." Here again an abstract category is mechanically
1
The Nichols and Beynon (1977) ethnographic study of "Chem. Co." has recently been
roundly criticized by Willmott (1984) for protraying managers as "pliant and passive
agents of capital", and thus for not being able to connect social action theoretically and
empirically with a structural analysis.