dq 1
WEEK
5: ORGANIZATIONAL DEVELOPMENT THEORY AND PRACTICES
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JetBlue Airways is a company which has embraced the OD theory and allowed OD’s
vision of emotional intelligence, value proposition, positive reinforcement,
and change through improvement and culture to drive much of its results over
the past years. The airline industry is one in which external influences have had
an unbelievable impact on the bottom line of all of the companies that fly.
Thus, it may defy imagination at first that in an industry of barely controlled
daily chaos, Jet Blue has found a way to make OD work to control that chaos.
Interestingly, in 2010, JetBlue was one of only three domestic airlines to turn
a profit, and their CEO, David Barger, is the lowest-paid CEO among the 10
largest publicly traded U.S. airlines in 2010. (Potkewitz) Doing research
online, use a Google™, Bing™, or other search-engine-style search, and find
case analyses or articles discussing JetBlue’s OD approach. After the crisis,
CEO Neeleman was terminated and Barger was put in his place. The company has
grown since Barger’s implementation. Their focus on organizational development,
and company values and culture, continues to this day, which is why it is not a
surprise to see that JetBlue Airways was one of the main case studies presented
at the 2011 Customer Experience Strategies Summit in Toronto, where Vicky
Stennes, VP ofInflight Experience presented
on their inside-out approach to motivating employees by creating a
customer-service-centric business model.
We’ll begin with these questions:
1. How does a company with an OD approach differ from one without that
approach?
2. Which company would you prefer to work for – one with an OD approach or one
without?
3. Do OD companies offer a higher value proposition to their customers than
non-OD companies? And if so, why don’t all companies take this approach?
dq 2
WEEK
5: NSTEP PRACTICES
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Class, you will be the “change agents” for this change. Your professor will be
the CEO, issuing dictates, orders, suggestions, support, ideas, and thoughts.
However, you, as class members, will need to take each new piece of information
and determine how it will fit into your plans for change, as change agents.
Keep an eye on the new information as well as how your colleagues are
addressing it. Innovation, creativity, and level headedness is key to making
this week’s solution succeed. Good luck!
Here’s the change: BubbleBath
Inc. is a privately owned company with approximately 2,000 employees whose make
up is primarily line workers. Management makes up about 20% of the company,
with the remaining 1,600 people working to produce the line of bathtubs, hot
tubs/spas, and designer fixtures for which the company has become famous. The
company started 10 years ago working out of the initial founder’s garage, and
quickly increased in size when Jacuzzis became a standard fixture in many
middle-class remodels and new constructions. Due to excellent marketing
strategies, BubbleBath Inc. has not experienced a downturn in sales despite the
recent economic downturn in construction. Instead, they have parlayed the
middle-class flight from tourism to encourage the “staycation” and the upgrade
of the home as the new spa of the 21st Century. Profits last year were up 15%
and everyone is feeling cautiously optimistic. Nevertheless, the CEO is
concerned with market analysis reports that despite the staycation mentality,
growth over the next two years is predicted to be stagnant to declining. Last
week, as per the original exit strategy of the founding investors, the company
will be restructured into a limited partnership of three people from an
incorporation model of 15 shareholders. 12 of the shareholders will be paid a
return of 8% on their investment, and the remaining 3 shareholders will form a
limited partnership. As a result, the CEO has received word from the new
partners that they want to change the operations model as follows, effective in
three months:
A. Discontinue the line of designer fixtures and focus solely on
hot tubs and bathtubs. (This will mean eliminating two lines of 30 employees
each.)
B. Move the entire operation from the city of Atlanta, GA to a town 25 miles
south of Atlanta called McDonough, where all 3 of the partners reside. No
relocation packages will be offered, but those employees who choose to “retire”
at the time of the move will receive a 4 weeks’ severance package. A new
building which was originally intended to be a “HottubsRUs” factory is sitting
vacant and the partners bought it for a steal. They already have a buyer for
the old factory in Atlanta.
C. For the first time, include a sales office right in the new production
building where a showcase with sales staff will be located. Along with
supplying retail stores, the company will now also sell directly, both in the
office and online. Initially, 5 sales people and one sales manager will be
hired.
Your CEO has asked you, the managers, to come up with a change
plan using Kotter’s 8-step model. What are the first things that you will do in
order to create a plan for change which will maximize efficiencies, utilize
current processes, and ensure that profits continue? Who wants to start?
