In October 1983, the School District of Philadelphia and the Pennsylvania Human Relations Commission signed a memorandum of understanding that resulted in a Modified Desegregation Plan. The plan itself consisted of three complementary initiatives: (1) an educational improvement component promising systemwide educational reforms, specialized programs, and a comprehensive school improvement project for the district's 75 lowest achieving schools; (2) a desegregation expansion strategy promising racially balanced faculties, programs within desegregated schools to foster integration, and the targeting of 50 additional schools for desegregation; and (3) an effort to reduce racial isolation promising augmented curricular units focusing on multicultural and interpersonal understandings for students remaining in racially isolated schools, an increase in shared time/shared facility programs, and a citywide mobilization of public and private agencies to support the schools. Philadelphia has made a genuine effort to have concurrent desegregation and school improvement, although in some areas these efforts conflict. The successful desegregated school is a coordination of many different elements involving nearly every important feature of organizational behavior: motivation, decision making, intergroup and interpersonal conflict, cooperation and communication. The district's plan is being carefully monitored by the Pennsylvania State Human Relations Commission. (MCK)