Change management - introduction

What is change management?

Change management is an aspect of management focusing on ensuring that the firm responds to the
environment in which it operates

Four key features of change management:

 Change is the result of dissatisfaction with the present strategies

 It is essential to develop a vision for a better alternative
 It is necessary to develop strategies to implement change
 There will be resistance to the proposals at some stage

Change often arises from:

 The development of new products

 The entry of new competition
 Changes in consumer tastes & preferences
 Changes in the cultural, political, economic, legal and social framework
 Changes in technology leading to technological obsolescence or new product opportunities

Change affects all aspect of people management.  HRM is directly affected be change in:

 Organisational structure
 Personnel of teams
 Process
 Location
 Work load
 Work role
 Work practices
 Supervision
 Work teams

There are many forces for change in business:

 Internal forces
 Desire to increase profitability
 Reorganisation to increase efficiency
 Conflict between departments
 To change organisational culture
 External forces
 Customer demand
 Competition
 Cost of inputs
 Legislation
 Tax changes
 New technology
 Political
 Ethics
 Technological obsolescence

Change management - force field analysis & Lewin's change model

Lewin’s Force Field Analysis

 There are forces driving change and forces restraining it

 Where there is equilibrium between the two sets of forces there will be no change
 In order for change to occur the driving force must exceed the restraining force

The analysis can be used to:

 Investigate the balance of power involved in an issue

 Identify the key stakeholders on the issue
 Identify opponents and allies
 Identify how to influence the target groups

Lewin’s change model

This model defines three stages in the process of change:

(1) Unfreezing
(2) Change
(3) Refreezing

It assists organisation change by:

 Allowing the process to be understood

 Providing milestones for evaluating progress towards the change

Unfreezing
This is the shake up phase perhaps triggered by declining sales or profits. The result is an acceptance
that the existing structures and ways are not working to get people ready for change it is necessary to
develop an awareness of the:

 Necessity of change
 Nature of change needed
 Methods planned to achieve the change
 Needs of those affected
 Ways that progress will be planned and monitored

Changing
This is the process of devising and implementing the change:
  Define the problem
 Identify solutions
 Devise appropriate strategy to implement change
 Implement solutions

Refreezing
This is the process of maintaining the momentum of change:

 Locking in the changes

 Stabilising the situation
 Building relationships
 Consolidating the system
 Evaluation and support
 Preventing any going back to the old ways

Refreezing is complete when the new patterns are accepted and followed willingly

Change management - resistance and barriers to change

Resistance to change
A degree of resistance is normal since change is:

 Disruptive
 Stressful

Moreover a degree of scepticism can be healthy especially where there are weaknesses in the proposed
changes.
However resistance will also impede the achievement of organizational objectives

Four basic reasons why change is resisted

Kotler and Schlesinger identified basic causes of resistance to change:

(1)Parochial self interest

 Individuals are more concerned with the implications for themselves

(2)Misunderstanding

 Communications problems
 Inadequate information

(3)Low tolerance of change

 Sense of insecurity

 Different assessment of the situation

(4) Disagreement over the need for change

 Disagreement over the advantages and disadvantages

Some negative comments often received on proposed changes:

  "My needs are already being met"
 "There is no justification for change"
 "I don’t like the way they propose to do it"
 "The risks outweigh the benefits"
 "It will now be harder for me to meet my own needs"

Organisational barriers to change

 Structural inertia
 Existing power structures
 Resistance from work groups
 Failure of previous change initiatives

Individual barriers to change

 Tradition and set ways:

 Loyalty to existing relationships
 Failure to accept the need for change
 Insecurity
 Preference for the existing arrangements
 Break up of work groups
 Different person ambitions
 Fear of:
Loss of power
Loss of skills
Loss of income
The unknown
 Redundancy
 Inability to perform as well in the new situation
Inappropriate change management

 Change is often resisted because of failures in the way it is introduced

 Failure to explain the need for change
 Failure to provide information
 Failure to consult, negotiate and offer support and training
 Lack of involvement in the process
 Failure to build trust and sense of security
 Poor employee relations

Why change should be welcomed

 Change can produce positive benefits for the individual:

 Opportunities for personal change and development
 Provides a new challenge
 Reduces the boredom of work
 Opportunity to participate and shape the outcome

Change management - implementation

Managing the change

Preparation for change

 Environmental analysis.
  Set out the strengths and weaknesses of the organisation

- Current provisions
- Resources
- Roles and responsibilities

 Identify the change required

 Determine the major issues
 Identify and assess the key stakeholders
 Win the support of key individuals
 Identify the obstacles
 Determine the degree of risk and the cost of change
 Understand why change is resisted
 Recognize the need for change, identify current position, devise a suitable method

Building the vision

 Develop a clear vision

 Make it people clear about what a change involves and how they are involved in it
 What is involved
 What is the proposed change
 Why should we do it
 What the major effects will be
 How we can manage the change

Plan the change

• Devise appropriate strategies to introduce change

• Design the change
• Identify the significant steps in the change process
• Discuss the need for change and the full details of what is involved
• Allow people to participate in planning change
• Communicate the plan to all concerned
• Produce a policy statement
• Devise a sensible time scale
• Produce action plans for monitoring the change
• Allow people to participate in planning change
• Get all parties involved in and committed to the change
• Inspire confidence by forestalling problems and communicating regularly
• Devise a sensible time scale for implementation of change
• Anticipate the problems of implementation
• Understand why change is resisted

Implementing the change

• Check on and record progress

• Make sure that change is permanent
• Evaluate the change
• Improve on any weak areas
• Overcome resistance
• Involve all personnel affected
• Keep everyone informed
• Devise an appropriate reward system
• Be willing to compromise on detail
• Ensure that strategies are adaptable
• Select people to champion change
• Provide support and training
• Monitor and review

Two types of change

(1) Step change

 Dramatic or radical change in one fell swoop

 Radical alternation in the organisation
 Gets it over with quickly
 May require some coercion

(2) Incremental change

 Ongoing piecemeal change which takes place as part of an organisation’s evolution and
development
 Tends to more inclusive

Step v incremental change

Techniques to help implement change

Teams building across units

Internal communication
Negotiation
Action planning
Change agents or champions of change
And a certain amount of compulsion manipulation and coercion

Change agents
Managers should be able to act as change agents:
 To identify need for change
 Be open to goods ideas for change
 To able to successfully implement change

Advantages of using a change agent:

 Forces trough change

 Becomes the personification of the process
 Responsibility for change is delegated thus freeing up senior managers to focus on future
strategy

Helping people to accept change

 Consider how they will be affected

 Involve them in the change
 Consult and inform frequently
 Be firm but flexible
 Make controversial change as gradually as possible
 Monitor the change
 Develop a change philosophy

Six ways of overcoming resistance to change

 (1) Education and communication - if people understand the needs for change and what is
involved they are more likely to co-operate.
 (2) Participation and involvement - to encourage people to feel ownership of the change.
 (3) Facilitation and support - listening to the real concerns of people affected.
 (4) Negotiation and agreement - agreement and compromise if necessary.
 (5) Manipulation - e.g. “buying off” leaders of resistance.
 (6) Explicit and implicit coercion - threats where necessary but this is a high risk strategy.

(source: Kotter and Schlesinger In HBR 1979)

Monitor and review

 Adapt as necessary
 Recording and monitor the changes
 Measure progress against targets
 Have the desired results been achieved?
 Has the process been successful?
 How do those affected feel about the new situation?
 What might have been done differently?
 How can those not responding well to the change be helped?
 Sustain the change.- prevent any back sliding

Kotter’s change phases model

 Establish a sense of urgency

 Create a coalition
 Develop a clear vision
 Share the vision
  Empower people to clear obstacles
 Secure short term wins
 Consolidate and keep moving
 Anchor the change

Change management failures

What to do
Ways to increase resistance to change:

Managers can increase resistance by:

 Failing to specific about a change

 Failing to explain why change is needed
 Not consulting
 Keeping people in the dark
 Creating excess work pressure
 Expecting immediate results
 Not dealing with fears and anxieties
 Ignoring resistance

Reasons why change can fail

 Employees do not understand the purpose or even the need for change
 Lack of planning and preparation
 Poor communication
 Employees lack the necessary skills and/ or there is insufficient training and development
offered
 Lack of necessary resources
 Inadequate/inappropriate rewards

Eight common reasons for failure of change management:

 Allowing too much complexity

 Failing to build a substantial coalition
 Failing to understand the need for a clear vision
 Failure to clearly communicate that vision
 Permitting roadblocks against that vision
 Not planning for short term results and not realising them
 Declaring victory too soon
 Failure to anchor changes in corporate culture

(John Kotter)