Topic > Institutionalization - 1385

Today's fast-paced, ever-changing, and unstable business climate impacts the ability of multinational companies like Hewlett-Packard to sustain a competitive advantage. In 2002 the company led a controversial takeover of Compaq which led to layoffs, infighting and affected their ability to implement structural changes. Hewlett-Packard is a widely respected company known for continuous improvement at all levels of the company. However, the challenge that all organizations face is the ability to implement and sustain intervention programs over a period of time to the extent that changes become part of the organization's functions. We will then examine the strategies and structure used by Hewlett-Packard to institutionalize intervention programs throughout its history. Institutionalization Process Institutionalization consists of incorporating processes of change brought about by effective interventions into the functioning of an organization over a prescribed period of time. Furthermore, the institutionalization process consists of socialization, commitment, reward allocation, diffusion, perception, and calibration. They are the by-products of two dimensions: organizational characteristics (such as congruence and unionization) and intervention characteristics (specificity of objectives and programmability). When Hewlett-Packard (HP) acquired Compaq in 2002, the combination of these two dimensions produced the institutionalization process. According to Cummings and Worley (2009), there are five factors of the institutionalization process (socialization, commitment, reward allocation, dissemination, tracking, and calibration) that determine the long-term implementation of interventions. In other words, the extent to which these organizations do...... middle paper ......ists must maintain constant vigilance over environmental forces such as the economy and internal forces such as the actions and behaviors of employees who they undermine the change process (Cummings & Worley, 2009). Conclusion Change strategies are part of the design of every organization. For an organization to be successful in implementing persistent change, all or most of the institutionalization factors outlined must be present. The most interesting aspect of Hewlett-Packard's interventions was the emphasis placed on optimizing the level of change at both the organizational and department levels. Finally, the aggressive structural changes initiated by Hewlett-Packard throughout its existence reflect the strategic planning and risk associated with maintaining a competitive advantage in the highly volatile information technology industry..