Page 338 - Managing Change in Organizations

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Coping with conflict
CASE
STUDY Oticon

Oticon, the Danish manufacturer of hearing aids which we came across in the case study
in Chapter 10 (page 167), is famous for having created ‘the Spaghetti organization’
through which it seeks to create new ways of working in pursuit of innovation and
reduced time to market. It has a record of substantially improved financial performance
since restructuring in the early 1990s.
In the midst of a turnaround strategy begun in 1989–90 a proposal came forward to
relocate head office to western Denmark so that it would be located with Oticon’s prin-
cipal factory. The new design provided for appealing working conditions, paperless
offices and so on. There was considerable opposition. Eventually this change was not
forced through over the opposition of staff. At the same time top management pressed
forward with the reorganization plan – once staff were settled into the new head office
the change was widely publicized in the press, on television and eventually on CNN. Was
this about creating a sense that there could be ‘no turning back’? To what extent was all
of this about managing perceptions? To what extent was the concession on location as
much about recognizing that some battles are not worth fighting and that ensuring that
people felt engaged in the process and listened to was important in focusing attention on
the future? If change requires that new routines be accepted and problems be solved,
then a platform of high self-esteem is needed. To what extent is the management of the
politics of change about managing perceptions and expectations to that end?

CASE
STUDY Union Carbide and the Bhopal disaster

On 3 December 1984 a cloud of deadly gas was released into the atmosphere around the
Union Carbide Corporation’s pesticide plant in Bhopal, India. With a death toll of over
1200 people, and many more injured, this was the world’s worst industrial accident.
On the other side of the world, in Connecticut USA, Union Carbide managers faced
the prospect of coping with the disaster. A complex set of issues had to be dealt with

quickly: how to establish the cause; how to ensure it could not be repeated; how to help
the victims; relief agencies; how to reassure investors; how to control the issue of legal
liability; what to announce.
With only two telephone lines into Bhopal and the plant supervisors under arrest,
hard information was difficult to come by. Much of the information coming through
seemed barely credible.
Hellreigel et al. (1986) quote this as a case of complex decision making. They describe
it as a convoluted action process because of the following four points:
1 The nature of the problem was unstructured – the managers had never faced a dis-
aster of this magnitude before.
2 The problem will go on for years – litigation alone is likely to continue over a period
of years.
3 Many vested interests were involved – the company, the Indian government, the
USA, the heirs of the dead, the injured and the shareholders of the company. ➔

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