organization development

BEN AND JERRY TEAM DEVELOPMENT INTERVENTION OD Group 2

OCTOBER 14, 2014 SUBMITTED TO – DR NILANJAN SENGUPTA SDMIMD

Table of Contents Introduction ............................................................................................................................................ 2 Mission Statement of Ben and Jerry ....................................................................................................... 2 Case Facts ............................................................................................................................................... 3 Question -1.............................................................................................................................................. 3 Open System Model................................................................................................................................ 4 Input – ................................................................................................................................................. 4 Design Components ........................................................................................................................ 4 Output ......................................................................................................................................... 5 Determination of under or over organized organization ....................................................................... 5 Summary of Organisation level:.............................................................................................................. 6 Methods of Data Collection .................................................................................................................... 7 Identification ........................................................................................................................................... 8 Convention .............................................................................................................................................. 8 Organization Structure............................................................................................................................ 8 Implication .............................................................................................................................................. 9 Question - 2............................................................................................................................................. 9 Rationale for Team Building as given in case ........................................................................................ 10 Analysis of the situation by our group .................................................................................................. 10 Other Interventions .............................................................................................................................. 11 Inter-group relations: ........................................................................................................................ 12 Large-group Interventions: ........................................................................................................... 12 Learnings ............................................................................................................................................... 13 Conclusion ............................................................................................................................................. 13 References ............................................................................................................................................ 13

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Introduction The company is started by two childhood friends, both college dropouts who were working on odd jobs for a time. They together opened a small ice cream scoop shop with the only idea of making really good ice cream! The two of them pride themselves on their funky fun culture and socially responsible mission. Although they never intended to grow into a large corporation they doubled the first few years and continued with strong profits thereafter. As time goes by the picture of an unorganized system and deteriorating productivity emerges. The problem is that the company’s external image of funk, fun and love is out of sync with the atmosphere inside the company. Further investigation reveals poor communication, feuding between functions and organizational units, unclear lines of authority and responsibility, and lack of operational control. The OD practitioner was commissioned to work with the founders, board of directors, management and work force to undertake an OD effort to bring people, functions, aspirations and directions together. The case offers a good example of how OD interventions might be used to address these issues.

Mission Statement of Ben and Jerry Ben & Jerry’s is founded on and dedicated to a sustainable corporate concept. The company’s mission consists of three interrelated parts: • Product Mission- To make, distribute & sell the finest quality all natural ice cream & euphoric concoctions with a continued commitment to incorporating wholesome, natural ingredients and promoting business practices that respect the Earth and the Environment.

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• Economic Mission- To operate the Company on a sustainable financial basis of profitable growth, in-creasing value for our stakeholders & expanding opportunities for development and career growth for our employees. • Social Mission - To operate the company in a way that actively recognizes the central role that business plays in society by initiating innovative ways to improve the quality of life locally, nationally & internationally.

Case Facts

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Ben Cohen and Jerry Greenfield head Ben & Jerry’s Homemade Inc., an independent ice cream producer.

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The company has competitors like Haagen-Dazs (Pillsbury), Frusen Gladje (Krafts) and Steve’s.

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It started as a small ice cream scoop shop in Burlington, Vermont in the late 1978.

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As the company grew to sales of $50 million, B&J’s embraced what it calls a social mission to improve the quality of life.

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Sales doubled annually from 1984 to 1986 and increased nearly 50% from1987 to 1988

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The company is today a super-premium market leader in Boston and New York City

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Some 80 Franchisees operate scoop shops in the American markets and company’s manufacturing facility and headquarters in Burlington have Vermont’s second largest tourist attraction with over 6000000 visitors annually.

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Over 350 people work at B&J’s.

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The company introduced “Peace Pops” as part of 1% for Peace Campaign

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A policy “linked prosperity” ensures 7.5% of pre-tax profits go to good works and 5% is returned to employees via profit sharing.

Question -1

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Team building is typically used in OD to loosen up an over organized system that is too rigid and bureaucratic. In this case, team building was aimed at providing structure to an under organized system. In doing a diagnosis what factors are important to consider in determining whether a company or team is over or under-organized? What are the implications for planning an OD intervention?

Diagnosis is the process of understanding how the organisation is currently functioning and it provides the information necessary to design change interventions. Entry and contracting processes can result in a need to understand either a whole system or some part, process, feature of the organisation.

Open System Model: Organisations as open system model suggest that organisations operate within an external environment, takes specific inputs from the environment and transforms those inputs using social and technical processes. The outputs of the transformation process are returned to the environment and can be used as feedback to the organisations functioning.

Input – General Environment and Industry Structure. B&J has a unique marketing edge that is difficult to imitate. B&J approaches values-led marketing by indulging in guerrilla marketing and lot of attention is given to public relation. Values- led marketing is about connecting social issues with the campaigns. Since marketing is such a powerful tool to give an opinion, the promotion of the products is linked to social messages. The industry is competitive with players like Haagen-Dazs, Frusen Gladje and the threat of new entrants is high. The threat of substitute is also high, if the funk and love appeal gives way to a different market amongst the newer generations. They allude to possible issues fulfilling existing marketing and franchise commitments due to low productivity. Design Components - Technology, Strategy, HR Systems, Measurement Systems, Structure and Culture. The B&J strategy revolves around differentiation. In trying to make the best ice cream, supporting that with creative advertising, and a philanthropic attitude, the organization must support this mission. The case provides a lot of data about issues arising in both the structural and cultural areas. 4

When being a values-led organisation the motivation among the people working in the company is one of the great advantages because they feel that they are actually contributing not only to bringing in money to the firm but also to making the society a better place to live in. That is, working for a company that is values-led means that you can bring your values to work as well whereas working in ”traditional” companies often means that you leave your personal believes at home. If the employees are fully aware of the social impacts they are contributing to by working for the values-led company the commitment they will have can be as great as the one shown by people in non-profit organisations The negative sides with human resource management in a values-led company are the problems it causes in bringing obscurity, confusion and, in the end, displeasure. The main problem at Ben and Jerry’s has been that the management have been unclear and therefore caused frustration among the employees. Another problem has been that while contributing and giving away a lot of money and resources to the community the internal benefits and facilities have been less invested in. This also created dissatisfaction among the people in the organisation who consider themselves to be non-prioritised and thereby it also creates problems. The solution to these problems has been structure and giving employees more benefits.

Output – Organization Effectiveness. The organization’s effectiveness is threatening current

profits and likely affecting, future profits. The deteriorating culture will adversely affect the brand as it is dependent on the funk and love appeal. The low productivity of employees is hindering production and the company will not be able to meet their growth needs.

Determination of under or over organized organization

Factors to consider in determining whether a company or team is over or underorganized are as follows: In the under-organized organisation, its leaders struggle largely with efficiency: how to get things done. Due to inadequate organizing, leaders find it difficult to pull the right "levers" and push the right "buttons" to make the organisation work. Telltale signs of under-organization include the following: 5

1. Staff and administrators are unsure which activities they can delegate and to whom they can delegate. 2. Members are not sure where they can best serve and "plug in." 3. A major expenditure of time and effort is required to get programs adopted and implemented. 4. The work load is unevenly distributed—some members and leaders are overworked while others are left out entirely. 5. Leaders are slow to discern and respond to the needs of members. 6. Members are only dimly aware of congregational goals and not well informed about daily events. Unlike the under-organized non-profit, the over-organized NPO can move efficiently in getting things done. Work is smoothly delegated, job descriptions are followed, and committees deliberate; however, leaders soon find themselves in a quandary over what priorities, goals, and strategy. The problem comes from the key shortcoming of overorganization: inadequate organizational feedback. Characteristics of the over-organized organization are: 1. Reliance on written, rather than face-to-face, communication. 2. Communication gaps between programs and lack of interaction between leaders ("specialization barriers"). 3. Meetings are carefully orchestrated with minimal staff participation--something done to members rather than something members do. 4. Planned programming dominates organizational life with little room for spontaneity. 5. Leaders are valued primarily for how well they perform their specialized functions rather than for who they are.

Summary of Organisation level:

Level of Organization: When diagnosing a system for a planned change effort the level of organization can have an effect on the intervention design. In over-organized situations, various dimensions such as leadership styles, job designs, organization structure, and policies and procedures are too rigid and overly defined for 6

effective task performance. Communication between management and employees is typically suppressed (or are one-way only), conflicts are avoided, and employees are apathetic. In under-organized organizations there is too little constraint or regulation for effective task performance. Leadership, structure, job design, and policy are poorly defined and fail to control task behaviours effectively. Communication is fragmented, job responsibilities are ambiguous, and employees’ energies are dissipated because they lack direction.

Methods of Data Collection: The 4 major techniques for gathering diagnostic data are: Questionnaires, Interviews, Observations and unobtrusive measures. In the meeting the following people were interviewed: Ben Cohen and Jerry Greenfield, the founders of B&J. Jeff Furman- Attorney and long-time B&J’s counsel, Fred Chico Lagerthe General Manager, Merritt- Businessman cum Board Member. In the board meeting the OD Practitioner asked the members of the board to write their individual opinion of the company’s mission & vision in order to get an idea of what they wanted from this OD Intervention. Data Gathering at the Board meeting revealed different and even conflicting expectations for this effort from various members. The practitioner also determined that neither Ben, nor Jerry, nor any board member, except Chico, could provide the day-to-day leadership needed to move development through the organization. On the contrary, the founders wanted to hand off the responsibility to Chico and his to-be-formed management team. The practitioner was to help bring that team into being and to ensure that they took leadership of B&J’s business and social missions. It was also to help bring the work force together. After all wrote their vision on a sheet of paper he burnt the sheets to symbolize how energy and togetherness could transform things.

The data gathered supports the conclusion that the system is under-organized. It describes a lack of clarity around structure, roles and teamwork, lack of common mission, direction, and priorities and talk of people being stretched to their limit. The implications of under organization in a planned change effort are that the initial change efforts must be aimed at increasing organization effectiveness by clarifying leadership roles,

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structuring communications, and specifying job and departmental responsibilities. Rather than the traditional steps of planned change this mode requires modifications to that process.

Identification:

Identify the relevant people or groups that need to be involved.

In this case the consultant chose to start with Chico and his team. Other options could have been the board, including Chico and the founders, the whole system at once or the whole system via separate efforts at various levels. Starting with Chico’s team keeps the effort manageable and creates a strong, unified base from which to launch any subsequent efforts.

Convention: Bring the relevant people and departments together. The consultant started with Chico and his managers in a series of teambuilding retreats. This gave the managers an opportunity to get to know each other and build trust which allowed them to start setting goals, direction, and priorities for the larger organization.

Organization Structure:

The change effort in an unorganized system will require that

new interactions among people and departments take place. This may mean new positions, communication channels, plans and policies.

The 20 managers under Chico had been operating fairly independently to this point. The teambuilding brought them together as a team, taught them management and problem solving skill, and prepared them to run the show. They could now work together on setting direction, solving problems and developing systems for control and follow-through. New work clusters were formed among them and each developed their own mission statement that translated into operating goals. In addition, managers met with their employees to get their input. A new safety committee was formed as well.

Evaluation: The activities aimed at increasing organization should be assessed along the way to ensure that they are producing the desired outcome. Initially there was a disconnect between the new management team and the founders as well as other board members. The founders worried whether the funk and fun was being lost in all 8

of this business and they were against growth, feeling that it would sacrifice cohesion. Managers demanded growth due to existing marketing and franchise commitments. A strategic meeting between the managers and the board allowed them to get aligned and resulted in several actions to address concerns: a joy committee for the cultural aspects, a push for more employee participation in the foundation and a new budget committee to formulate a one-year plan.

Implication In this case planning an intervention was needed because nobody was taking responsibility for anything. They had no guidelines or structure to go by in their work. Ben and Jerry wanted to make it a fun family work environment. In doing this, they lacked the means to place authority in to effect. If things got broken nobody would man up and take responsibility for their own actions. For instance when a freezer door was broken then neither the freezer nor maintenance nor production managers claimed ownership of the problem or took responsibility to see that it was fixed. If Ben and Jerry would have placed authority above fun this could have been avoided. If they would have been boss before friend it would not have gotten to this point. Thereby making an OD Intervention a need of the hour for Ben & Jerry.

Question - 2 What do you think about using teambuilding as the launch for this OD effort? What other approaches might be considered?

Team Building is typically used in OD to loosen up an over-organized system that is too rigid and bureaucratic. In this case, team building is aimed at providing structure to an underorganized system. In doing a diagnosis, what factors are important to consider in determining whether a company or team is over- or under-organized? In determining whether a company or team is over- or under-organized there are strengths and concerns that must both be considered. The strengths that need to be addressed are: 

High commitment to the company and its mission

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Norms of honesty and straightforwardness

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Smart and articulate management 9

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High interest in growth and learning

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Founders and general manager as role-models.

The concerns that must be addressed are: 

People and systems not keeping pace with growth

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lack of clear structure roles and teamwork

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lack of common mission, direction, and priorities

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people are stretched to the limit

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Founders and general manager are both company’s greatest strength and greatest weakness.

Rationale for Team Building as given in case The reasons cited by the OD consultant for using team building as a tool for OD intervention are: First it was crucial for managers to begin to think of themselves as managers and as members of management team. Many of the managers at Ben and Jerry were truly supervisors who worked alongside employees and focussed only on the work going on in their own area of responsibility. Second the managers would be assuming new responsibilities heretofore in the hands of the founders and general manager. The OD consultant is of the opinion that it is important for them to see how much they had in common and how much affinity they had with the founder’s vision of the enterprise. Finally managers had to collectively commit to taking on new responsibilities and learn new methods for working together.

Analysis of the situation by our group

Team building was not the most effective way to launch an Organizational Development effort, in the case of Ben and Jerry’s. There are two critical issues that must be dealt with 10

before any kind of team building should be attempted. The first issue would be creating more of a consensus between the founders and the Board about the vision of the ideal organization and the goals of the OD effort. The second issue is the interpersonal conflict between Ben and Chico. The consultant may have used Ben and Jerry’s idiosyncratic personalities to his advantage in order to gloss over the lack of agreement on the company vision between the founders and the board. The board members were asked to write down their differing visions on paper and the consultant performed a ritual of burning these to represent transformation and coming together of management and the Board. This is only a metaphor, and did not have the intended effect on either the Board or Ben and Jerry. Both Ben and Jerry still felt a separation in values between themselves and management after the team building retreat. This was demonstrated by the managers wearing “we are weird” buttons after the team building. Rather than the ritual burning of the ideas, the consultant would have better served the clients with an intergroup conflict resolution process. The division over the vision of Ben and Jerry’s had become dysfunctional and was creating conflict which polarized the two groups. The groups being the free-wheeling, hippy minded founders and the more business minded managers.

This problem was affecting the

productivity and effectiveness of the organization at large and must be dealt with and resolved before any interventions are carried out and lower levels of the organization. Management must buy-in to the OD effort, and if they feel that the founders are flawed in their business strategy, it will be impossible for management to carry out their wishes for the way they want their business to grow and prosper. The consultant has acknowledged the problem, yet performed no real interventions to try and resolve it.

Other Interventions

Among the interventions that might be considered here are: Organization Confrontation Meeting: This change method mobilizes organization members to identify problems, set action targets, and begin working on problems. In this case, it would probably represent a series of meetings between two or more feuding groups. However, the case data suggests that the organization is not ready for this type of intervention. The lack of

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clarity about the strategy and the role of the senior managers in change suggests that there is little guidance to provide the groups who might be trying to resolve their conflicts.

Inter-group relations: These interventions are designed to improve interactions among different groups or departments in organizations. The microcosm group intervention involves a small group of people whose backgrounds closely match the organizational problems being addressed. The inter-group conflict model typically involves a consultant helping two groups understand the causes of their conflict and choose appropriate solutions. The issues facing this company seem more along the lines of alignment, focus, and leadership rather than a true conflict. This could have been used to address issues amongst the founders and board members but wouldn’t have addressed the under-organized problem. Large-group Interventions: These interventions involve getting a broad variety of stakeholders into a large meeting to clarify important values, to develop new ways of working, to articulate a new vision for the organization or to solve pressing organizational problems. This seems like a viable option especially after team building with the top management team. Attempting this intervention before the team building has the same problems as the confrontation meeting…there’s no sense of strategy at the top and the large group might have difficulty getting traction on ideas that are generated. The practitioner chose teambuilding with the management team which could be fully discussed here. OD is not an exact science that can be put into concise prescriptive. Ben & Jerry’s was experiencing an organization wide issue. The practitioner’s point of view was that the board was not prepared to deal with its own issues and become united to provide the leadership that the rest of the organization needed. So the starting point became the managers. They had to become a team before any other level of the organization could be addressed. The outdoor techniques used in this case can be effective teambuilding activities. They get a team outside of their work environment and by design are able to highlight interpersonal, communication and decision making processes. Another option could have been an intervention with the board and founders and to confront them on their lack of leadership and their inability to deal with their own issues.

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Learnings Now that the management team has formed and they have aligned themselves with the board and the founders, there is a good opportunity to get the rest of the workforce aligned to and engaged in the newly clarified goals. Getting the system organized around a common mission and goals provides bedrock for them to work on bigger issues. They may need to work on their processes, teamwork at lower levels, communication channels, etc.

The innovative nature of the company and commitment level of the employees suggests a readiness for a large group intervention to take them to the next level.

Conclusion The Ben & Jerry is today the super-premium market leader and distributes its products in various grocery stores across the country. B&J’s embraced with the social mission to improve the quality of life on every aspect, not only of employees but also locally, nationally and internationally, and to do so in an innovative and upbeat way. As the OD practitioner enquired the key managers and staff at B&J’s that showed various areas of strength and concerns for the company. After interviewing various stakeholders the OD practitioner got the pulse of strength which let many managers to leave successful jobs in other companies and join B&J’s because of its funky atmosphere, freewheeling style and socially responsible orientation. There was an environment of participatory style of management with people those charged with higher level of responsibility in comparison to their experience handling the responsibility. The main concerns for the company was underorganised for handling the challenges posed by rapid growth in the market place and workforce and it is quite clear from the interviewees that there was absence of clear goals and agreed to priorities, problem of communication and co-ordination, half-finished tasks and cede of new initiatives in many cases. (Anders Borgh, june 2005) Team building can improve group performance particularly on tasks that are complex, unstructured and interdependent. So, the OD practitioner recommended the team building intervention at B&J’s based on the rationale that it was crucial for managers to pretend as members of management team, delegation of new responsibility to manager which was previously used to be in the hand of founders and general manager and finally it would help in getting committed and working collaboratively. Team building is basically directed towards improving group effectiveness in which members of team work together. The members of team have either common organizational aims or work activities. The general process of team building is trying to equip a team to handle its ongoing problem solving.

References Anders Borgh, A. M. (june 2005). Values-led business - A study of the Ben and Jerry’s concept and its applicability.

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