Management Question

‫المملكة العربية السعودية‬
‫وزارة التعليم‬
‫الجامعة السعودية اإللكترونية‬

Kingdom of Saudi Arabia
Ministry of Education
Saudi Electronic University

College of Administrative and Financial Sciences

Assignment 3
Organization Design and Development (MGT 404)
Due Date: 26/04/2025 @ 23:59
Course Name:

Student’s Name:

Course Code: MGT404

Student’s ID Number:

Semester: Second

CRN:
Academic Year:2024-25-2nd

For Instructor’s Use only
Instructor’s Name: Dr. Yasmeen Ansari
Students’ Grade:
Marks Obtained/Out of 10

Level of Marks: High/Middle/Low

General Instructions – PLEASE READ THEM CAREFULLY
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The Assignment must be submitted on Blackboard (WORD format only) via allocated
folder.
Assignments submitted through email will not be accepted.
Students are advised to make their work clear and well presented, marks may be reduced
for poor presentation. This includes filling your information on the cover page.
Students must mention question number clearly in their answer.
Late submission will NOT be accepted.
Avoid plagiarism, the work should be in your own words, copying from students or other
resources without proper referencing will result in ZERO marks. No exceptions.
All answered must be typed using Times New Roman (size 12, double-spaced) font. No
pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted.

Learning Outcomes:
1. Describe the basic steps of the organizational development process.
2. Evaluate the strategic role of change in the organization and its impact on
organizational performance.

Assignment Question(s):
Please refer to the case study titled “Changing the Human Capital Management
Practices at Cambia Health Solutions” given Chapter 15 in your textbook and answer
the following questions:
1. What are internal and external factors that made Cambia Health Solutions to change
its employee management practices? and how do these reasons fit with what’s
happening in the industry? (minimum 400 words, 3 marks)
2. How important was technology in changing Cambia’s employee management
practices, and was it effective in making the changes successful? (minimum 250
words, 2 marks)
3. How did Cambia involve its employees in the redesign process, and did this
involvement help or slow down the changes? (minimum 250 words, 2 marks)
4. What other changes or updates could Cambia make in the future to keep improving
its employee management system and stay effective in the changing healthcare
industry? (minimum 400 words, 3 marks)

Note:
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You must include at least 5 references.
Format your references using APA style.

Answers
1. Answer2. Answer3. Answer-

Restricted – ‫مقيد‬

tomorrow’s schedule and writes some personal reminders before starting off
on her 30-minute commute home.
1. How effectively do you think Troi spent her day?
2. What does the case tell you about what it is like to be a project manager?
1 Slack is a communications program designed to manage the flow of information on a
project. See slack.com.

Case 1.2

The Hokies Lunch Group1
PART A
Fatma settled down for lunch at the Yank Sing Chinese restaurant. She was
early and took the time to catch up on her e-mail. Soon she would be joined
by Jasper and Viktoria, two fellow 2014 grads from Virginia Tech in
Blacksburg, Virginia.
Jasper worked as a software engineer for a start-up company that
wanted to expand the boundaries of sharing economy. Viktoria was an
electrical engineer who worked for a German healthcare company in San
Francisco. They had met each other at a Silicon Valley alumni reception
hosted by Virginia Tech. Each of them felt a bit like a fish out of water on
the West Coast, so they decided to have lunch together each month. The
lunch evolved into a professional support group. A major part of each of
their jobs was managing projects, and they found it useful to share issues
and seek advice from each other.
Fatma worked for a very successful Internet company whose founders
believed that everyone in the firm should devote three days a year to
community service projects. The company was partnering with several
companies in the construction industry to renovate abandoned buildings for

low-income families. The next project was the renovation of an empty
warehouse into eight two-bedroom apartments. Fatma was part of the core
team in charge of scheduling and managing work assignments.
Viktoria and Jasper entered the restaurant together. Viktoria was the first
to move to the Bay Area. She was currently working on the next-generation
neural stimulator (“PAX 2”). Neural stimulators are electronic devices that
doctors implant in patients with wires connected to sources of pain in the
patient’s spine. In the past, patients would have to have an operation to
replace the stimulator battery every 10 years. PAX 2 was being designed to
page 24
take advantage of new battery technologies and use a
rechargeable battery. In concept, this battery system would
eliminate the need for replacement surgeries and allow the implanted
battery to be recharged externally. Viktoria’s team had just completed the
second prototype and was entering a critical testing phase. It had been
tricky trying to predict the lifespan of the new rechargeable battery without
testing it in real time. She was anxious to begin seeing the test results.
Jasper was working for a start-up company after doing contract work for
his first nine months in San Francisco. He was sworn to secrecy about the
project and all Fatma and Viktoria knew was that the project had something
to do with sharing economy. He was working with a small development
team that included colleagues from Bangalore, India, and Malmo, Sweden.
After ordering and chit-chatting a bit, Fatma started the discussion. “I
will be glad when this week is over,” she said. “We’ve been struggling
defining the scope of the project. At first glance our project seems relatively
simple, build eight two-bedroom apartments in an old warehouse. But there
are a lot of unanswered questions. What kind of community space do we
want to have? How efficient should the energy system be? What kind of
furniture? Everybody wants to do a good job, but when does low-income
housing morph into middle-income housing?”
Viktoria offered, “Scope defining is one of the things my company does
very well. Before a project is authorized, a detailed scope statement is
developed that clearly defines the project objectives, priorities, budget,
requirements, limits, and exclusions. All of the key stakeholders sign off on
it. It is really important to identify priorities up front. I know on the PAX 2
project that scope is the number one priority. I know that no matter how
long it takes it is imperative that my work is done right.”

Fatma responded, “That’s exactly what my project manager is preparing
for Friday’s meeting. I guess that one of the things you have to do as a
project manager is end discussions. He is going to make the tough calls and
finalize the project scope so we can begin planning.”
Jasper interjected, “You guys are so lucky; for the most part your scope
remains the same. In my work the scope is constantly changing. You show
the founders a feature they wanted, and they say, well, if you can do that,
can you do this? You know it’s going to happen, but you really can’t plan
for it.”
Jasper went on, “We do know what our number one priority is: time.
There are a lot of players trying to move in to the ‘space’ we are working
on. We have to demonstrate we are ahead of the pack if we are going to
continue to get VC funding.”2
Jasper said that despite the pressure, his project had been a lot of fun.
He especially liked working with his Swedish and Indian counterparts, Axel
and Raja. They worked like a global tag team on their part of the project.
Jasper would code and then pass his work on to Raja, who would work on it
and pass it on to Axel, who would eventually hand it off to Jasper. Given
the time zones, they were able to have at least one person working on the
code around the clock.
Jasper said it was hard at first working with someone he hadn’t met
personally other than on a video screen. Trust was an issue. Everyone was
trying to prove himself. Eventually a friendly competition arose across the
team. The programmers exchanged funny cartoons and YouTube videos. He
showed Fatma and Viktoria a YouTube video about scope creep that got a
chuckle from everyone.
They made plans to meet next at the new Peruvian restaurant on SE 8th
Street.
page 25

PART B
The Peruvian cilantro/lime ceviche was a big hit at the next lunch. Viktoria
began their discussion by reporting, “I have good and bad news. The bad
news is that our first prototype failed its tests miserably. The good news is
that I have a smart project manager. She knew this could happen, so she

mitigated the risk by having us working on two alternative battery
technologies. The alternative technology is passing all of the tests. Instead
of falling behind months, we are only days behind schedule.”
This precipitated a discussion of risk management. Fatma reported that
there had been a two-day session on risk management for the renovation
project. They spent the first day brainstorming what could go wrong, and
the second day coming up with strategies for dealing with risks. A big help
was the risk report that was generated after the last project. The report
detailed all of the problems that had occurred on the last renovation project
as well as recommendations. Fatma said, “I couldn’t believe how much
time and attention was devoted to safety, but as my project manager said,
‘all it takes is one bad accident to shut down a project for weeks, even
months.’”
Jasper reported that on his project they spent very little time on risk
management. His project was driven by a build-test mentality. “Everybody
assumes that daily testing eliminates problems, but when it’s time to
integrate different features, that’s when the real bugs will emerge,” Jasper
said.
Jasper went on to say that things were not going well at work. They had
missed their second straight milestone, and everyone was feeling the
pressure to show results. “I even slept by my cubicle three nights ago,”
Jasper confessed. Fatma asked, “How many hours are you working?” “I
don’t know, at least 70, maybe 80 hours,” Jasper answered. He went on to
say, “This is a high-stakes project, with a BIG upside if successful. I am
doing some of my best programming and we’ll just have to see what
happens.”
Jasper showed them a cartoon that was being circulated across his team.
The caption read “When did you want it done? Yesterday.”
Fatma turned to her friends and said, “I need some advice. As you
know, I’m responsible for scheduling work assignments. Well, some of my
colleagues have been pretty aggressive lobbying for choice assignments.
Everyone wants to work alongside Bruno or Ryan. Suddenly I am
everyone’s friend, and certain people are going way out of their way to do
favors for me. I am sure they think it will influence my decisions. It’s
getting awkward and I am not sure what to do.”
“Quid pro quo,” answered Jasper, “that’s how the business world works.
You scratch my back and I’ll scratch yours. Within reason, I don’t have a

problem with someone taking advantage of her position to garner favors
and build relationships.”
Viktoria said, “I disagree. You don’t want to be seen as someone whose
influence can be bought. You need to think what’s best for the company.
You need to ask yourself what Bruno and Ryan would want you to do. And
if you don’t know, ask them.”
After much discussion, Fatma left the restaurant leaning toward
Viktoria’s advice, but she wasn’t sure what the guidelines should be.

PART C
It took two months for the Hokies lunch group to get together again. Jasper
had canceled the last meeting because of work, so Viktoria and Fatma saw a
movie together instead.
page 26

Jasper was the last person to arrive and it was clear from the look on his
face that things were not going well. He sat down, avoiding eye contact,
before blurting, “I’m out of work.” “What do you mean?” Fatma and
Viktoria cried. Jasper explained after months and months of work they had
been unable to demonstrate a functional product.
Jasper went on to say, “Despite our best efforts we couldn’t deliver. The
founders couldn’t get an ounce of second-round venture funding, so they
decided to cut their losses and kill the project. I just spent the best six
months of my programming life for nothing.”
Fatma and Viktoria tried to comfort their friend. Fatma asked Jasper
how the others were taking the news. Jasper said the Swedish programmer,
Axel, took the news very hard. He went on to say, “I think he was burning a
lot of bridges at home with the long work hours and now he has nothing to
show for it. He started blaming us for mistakes we never made.” Raja, his
Indian counterpart, was a different story. “Raja seemed to shrug his
shoulders.” Jasper added, “He said, ‘I know I am a good programmer. There
are lots of opportunities here in Bangalore.’”
Fatma broke the silence that followed by saying to Jasper, “Send me
your resume. My company is always looking for top-notch programmers
and it is a really great company. Can you believe it, the two founders, Bruno
and Ryan, are working side by side with everyone on renovating the

warehouse? In fact, people were amazed at how good Bruno was with sheet
rock. A big part of my job now is scheduling their time so they can work
with as many different people as possible. They really want to use the
project to get to know their employees. This hasn’t been easy. I have had to
juggle their calendars, their abilities, and work opportunities.”
Viktoria interjected, “You’re using Microsoft Project to do this?” “Not
really,” responded Fatma. “At first I tried scheduling their work in
Microsoft Project, but it was too cumbersome and time consuming. Now I
just use the Project master schedule and each of their calendars to schedule
their work. This seems to work best.”
Viktoria added, “Yeah, Microsoft Project is a great program, but you
can get lost trying to get it to do everything. Sometimes all you need is an
Excel sheet and common sense.”
Viktoria felt awkward, given what had happened to Jasper. She was just
wrapping up the successful PAX 2 project. She was also getting ready for a
well-deserved holiday in Vietnam paid for by her project bonus. “I hate
closing out a project,” Viktoria said. “It’s so boring. Document, document,
document! I keep kicking myself for not tracking things when they
happened. I am spending most of my time scouring my computer for files. I
can’t wait to take off to Vietnam.”
Viktoria went on to say, “The only thing I liked doing was the project
retrospective.”
Jasper asked, “What’s a project retrospective?” Viktoria answered, “It’s
when the project team gets together and reviews what went well and what
didn’t and identifies lessons learned that we can apply to future projects.
For example, one of the things we learned was that we needed to bring the
manufacturing people on board a lot sooner in the design process. We
focused on designing the very best product possible, regardless of cost. We
found out later that there were ways for reducing production costs without
compromising quality.”
Fatma added, “We do that, too, at the end of our projects, but we call it
an audit.”
page 27

Fatma asked Viktoria, “Do you know what your next assignment will
be?” “No,” she replied, “I will probably go back to my department and do

some testing. I’m not worried. I did good work. I am sure someone will
want me for their project.”
Jasper chimed in, “I sure hope someone wants me for their next
project.” Fatma and Viktoria immediately went into action, trying to lift
their friend’s spirits.
A little while later, they walked out of the restaurant and gave each
other hugs. Fatma reminded Jasper to send her his latest resume.
1. For each part (A, B, C), what phase of the project life cycle is each
project in? Explain.
2. What are two important things you learned about working on projects
from the case? Why are they important?
1 Hokies is the name associated with Virginia Tech athletic teams.
2 New venture capital funding.

Design elements: Snapshot from Practice, Highlight box, Case icon: ©Sky
Designs/Shutterstock
1 It should be noted that PMBOK also includes Incremental and Iterative as two additional
approaches, which are beyond the scope of this text. Search pmi.org for further details.
2 LEED certification was developed by Leadership in Energy and Environmental Design
(LEED) and is one of the most popular green building certification programs used
worldwide.

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PART 5 HUMAN RESOURCE INTERVENTIONS

C

ambia Health Solutions (www.cambiahealth.
com) is a nonprofit health care and insurance company dedicated to transforming
the way people experience the health care
system. Located in the Pacific Northwest of the
United States, Cambia’s portfolio of companies
spans health care information technology and
software development; retail health care; health
insurance plans; pharmacy benefit management; life, disability, dental, vision and other
lines of protection; alternative solutions to
health care access; and free-standing health
and wellness solutions. The largest business
in the portfolio is Regence Health, a health insurance plan associated with the Blue Cross and
Blue Shield brands. Regence Health is over 90
years old and operates in Washington, Oregon,
Idaho, and Utah.
In 2010, Cambia convened a crossfunctional design team to increase the organization’s overall agility. As part of that effort, the
design team initiated a change to its performance management system for leadership
staff (approximately 750 people). The performance management system changes were
based on diagnostic data that the organization
was not focused on the critical areas required
for success as well as feedback from organization members. The feedback suggested that
(1) there were inconsistencies with respect to
disciplined human capital management practices, (2) leaders were unclear about their individual objectives and how their objectives related to
the organization’s strategies, and (3) objectives
were not clearly connected to professional
development and career advancement.
The design team chartered a crossfunctional task force to develop a new performance management process aimed at all
leadership roles (supervisors and above), and
supported the team with an external organization development and performance management consultant. At the highest level, the
task force recommended a process that
began with a requirement that all leaders
establish annual objectives, conduct quarterly

performance conversations, and enable a
focused talent review twice a year. On an
annual basis, the performance conversations
would be linked to a revised compensation
and reward process. At the center of the new
process was a series of quarterly “performance conversations.” Performance conversations established a dialogue where the leader
and his/her direct reports could review past
quarter performance on agreed upon objectives and prepare for the next quarter. The conversation was oriented around four questions:
• Did the employee accomplish what was
committed to in the prior performance
period?
• How could the employee have performed
more effectively?
• What objectives should be continued into
the next quarter, what should be stopped,
and what new objectives should be established for the next quarter?
• How should the employee go about doing
what needs to be done?
The cycle of quarterly performance conversations and semiannual talent reviews was initiated by an objective-setting process. The task
force and design team were influenced by the
timely processes established by some internal
departments who had success with similar
processes around quarterly conversations and
regular talent reviews (this process was also
validated to be a “best practice” by the external consultant). This entire process significantly
simplified the existing performance appraisal
process in which leaders were evaluated
across seven categories. This new process
focused on only two things: (1) the “what”
(the established objectives) and (2) the “how”
(the extent to which the company’s values
were carried out in achieving the objectives).
The “what” conversation was intended to
develop and establish a total of three to six
objectives with at least one in each of three
categories: (1) human capital management or
how the leader was going to develop his/her

application 15 1

CHANGING THE HUMAN CAPITAL MANAGEMENT
PRACTICES AT CAMBIA HEALTH SOLUTIONS

CHAPTER 15 PERFORMANCE MANAGEMENT

people, (2) operational goals linked to the organization’s strategic objectives, operational improvements, and/or regulatory/legislative mandates, and
(3) the leader’s own professional development. In
addition, the “how” conversation was to focus on
the way the leader achieved the “what” objectives
(by demonstrating the company’s values). Leaders
were encouraged to—and their ultimate annual
performance review was dependent on—getting
work done through others, holding people accountable, and encouraging cross-functional, innovative,
and problem-solving behaviors. These latter two
issues—accountability and cross-functional problem solving—had been identified as important
areas in the diagnosis.
To support the program, an on-line, ondemand training module was developed. In the
module, leaders were helped to understand the
importance of employing sound human capital
management practices (with a particular focus on
the quarterly conversations) as well as the importance of developing “SMART” objectives that
were specific, measurable, achievable, relevant,
and timely. This online training module was provided as a prerequisite to a series of more detailed
webinars which were facilitated by senior leaders
(not HR staff).
The new objective setting and performance
conversation process was approved by the design
team and supported by Cambia’s leadership team.
As part of that support, the leadership team
accepted the recommendation of the task force
and design team to have “coaches” oversee the
early implementation of the new process—which
included the CEO taking on the role of coach for
his direct reports. He committed to monitoring
and reviewing the development and establishment
of objectives and to holding quarterly performance
conversations. The members of the task force
served as coaches to the other levels of management in the organization. The coaches were a visible means of championing the new system,
holding leaders accountable for implementation,
and raising the bar and expectations for human
capital management at Cambia.
To reinforce the expected changes in behavior,
the task force also included two rewardsystem-related recommendations. The first was
to increase differentiation in the appraisal process

447

by changing the performance categories from four
to two. In the old system, leaders rated their direct
reports according to a “top-key-core-low” scheme
and then engaged in a calibration process that
helped ensure the validity of those ratings. The
task force recommended moving to a two-tier
system of “performing and exceeding.” They
acknowledged that there may be situations where
leaders were in a “performance improvement”
scenario that was associated with correcting poor
performance. In most cases, however, leaders
were expected to be “performing” but the highest
performers would be recognized for “exceeding”
expectations. The existing calibration process was
retained as many leaders indicated that it was a
beneficial process for maintaining consistency in
the system. The performing and exceeding performance categories were tied to recommendations
for base-pay increases. The system was set up to
reward “exceeders” at a rate 2.5 times that of
“performers” to provide the differentiation.
The second reward system recommendation
was to establish a unique “spot” awards program
for all leadership staff. The spot awards program,
entitled the “Excellence in Leadership Award,”
was designed to recognize leaders for exemplary
performance in either human capital management
or agile behaviors. The cash portion of the award
was set at $1,000 and the awards were to be delivered personally by a member of Cambia’s leadership team. Recipients of the award are highlighted
in the company’s newsletter—the goal being to
reinforce among all leaders the kind of leadership
behavior that is required for moving forward.
Although the new process had been developed with a broad range of inputs, it was kicked
off with a presentation to senior leaders at
Cambia’s annual senior leadership summit. There,
these senior leaders were able to ask questions,
hear about the way the process worked, and
understand the assumptions underlying its design.
Following the presentation, these leaders were
given a schedule to develop the initial quarterly
“what” objectives for themselves and all other
leadership staff across the company.
As the objectives were submitted, the task
force members and performance coaches
reviewed the objectives and provided feedback as
appropriate. By the deadline, over 90% of all

448

PART 5 HUMAN RESOURCE INTERVENTIONS

leadership staff (of the 750 supervisors and above)
had submitted quarterly objectives and participated
in the online training program and webinar. The
organization has been through two cycles of quarterly conversations, had their initial talent reviews,
and is anticipating the first cycle of the new reward
system. To date, leadership staff have supported

the objective setting process, the quarterly performance conversations, and the semiannual talent
reviews. The importance of setting aligned objectives and using the performance management process to manage human capital in the organization
has received increased emphasis and visibility in
the organization.

participation in goal setting generally are substantiated across studies and with both
groups and individuals.19 Longitudinal analyses support the conclusion that the gains in
performance are not short-lived.20 A field study of the goal-setting process, however,
failed to replicate the typical positive linear relationship between goal difficulty and performance, raising some concern about the generalizability of the method from the laboratory to practice.21 Additional research has attempted to identify potential factors
moderating the results of goal setting, including task uncertainty, amount and quality
of planning, personal need for achievement, education, past goal successes, and supervisory style.22 Some support for the moderators has been found. For example, when the
technical context is uncertain, goals tend to be less specific and people need to engage in
more search behavior to establish meaningful goals.
The existing research on MBO effectiveness is large but mixed.23 However, it suggests
that a properly designed MBO program can have positive organizational results. Carroll
and Tosi conducted a long-term study of an MBO program at Black & Decker,24 first
evaluating the program and then using those data to help the company revise and
improve it. This resulted in greater use of and satisfaction with the program. The
researchers concluded that top-management support of MBO is the most important
factor in implementing such programs. Many programs are short-lived, however, and
wither on the vine because they have been installed without adequate diagnosis of the
context factors. In particular, MBO can focus too much on vertical alignment of individual and organizational goals and not enough on the horizontal issues that exist when tasks
or groups are interdependent.

15-3 Performance Appraisal
Performance appraisal is a feedback system that involves the direct evaluation of individual or work group performance by a supervisor, manager, or peers. Most organizations
have some kind of evaluation system that is used for performance feedback, pay administration, and, in some cases, counseling and developing employees.25 Thus, performance
appraisal represents an important link between goal-setting processes and reward systems. A 2001 survey of over 300 North American companies, for example, found that
65% reported a link between performance ratings and rewards, 46% used the system
equally for performance development and decision making, and 53% of the organizations
believed the system was aligned with organizational values and priorities.26 Abundant
evidence, however, indicates that organizations do a poor job appraising employees.27
As one study put it, “The appraisal of performance appraisals is not good…. In fact,

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