ORGANIZATIONAL BEHAVIOUR

SUBJECT CODE- ROB3E002

MODULE –V

ORGANIZATIONAL CHANGE

MEANING
Change simple means the alteration of the status quo. Even in the most stable
organisations, Change is necessary just to keep the level of given stability. The economic
and social environment is so dynamic that without the change that would be adaptive to the
changed environment, even the most successful organization will be left behind, unable to
survive in the new environment.
A short list of some of the changes which affected almost all organizations in the past few
decades is given here:
(1) Technological innovations have multiplied, products and know how are fast becoming
obsolete.
(2) Basic resources have progressively become more expensive.
(3) Competition has sharply increased.
(4) Communication and computers have reduced the time needed to make decisions.
(5) Environmental and consumer interest groups have becomes highly influential.
(6) The drive for social equity has gained momentum.
(7) The economic inter-dependence among countries has become more apparent.
DEFINITION:
Thus organisational change is the alteration of work environment in organisation. It implies a
new equilibrium between different components of the organisation technology, Structural
arrangement, job design and people.
FEATURES
The organisational change may have the following features.
1. When change occurs in any part of the organisation, it disturbs the old equilibrium
necessitating the development of a new equilibrium. The type of new equilibrium depends on
the degree of change and its impact on the organisation.
2. Any change may affect the whole organisation, some parts of the organisation may be
affected more, others less, some parts are affected directly, others indirectly.
3. Organisational change is a continuous process. However, some changes which are of
minor type, may be absorbed by the existing equilibrium, others which are major ones may
require special change efforts.
Newstrom and Davis have explained the impact of a change in any part of the organisation
on the total organisation. They have illustrated it by comparing an organisation to an air-filled
balloon. When a finger (which represents external force) is forced against a point on the
balloon. (Which represents the organisation), the contour of the balloon visibly changes, it
becomes indented at the point of contract. However, if we look minutely, we find that the
shape of the entire balloon has changed, it has stretched slightly. Thus, they have concluded
that the whole organisation tends to be affected by change in any part of it.
However, the change in organisation does not occur purely on mechanical relationship.
While managers as a change agent want to bring changes in the organisation employees
want to maintain a status quo. Though these phenomena will be taken latter, what is
important at this point is that a change in any part affects the entire organisation and
subsequent changes are required in other parts.

NATURE OF ORGANIZATIONAL CHANGE:

Organisational change is the process by which organisations move from their present state
to some desired future state to increase their effectiveness. Characteristically change is -
 vital if a company were to avoid stagnation;
 a process and not an event;
 normal and constant;
 fast and is likely to increase further in the present competitive business;
 'directive', that is, implemented by 'top down' management or 'participative', that is,
involving those parties impacted by change;
 is 'natural', that is, evolutionary or 'adaptive', that is, a reaction to external
circumstances and pressures;
 is 'incremental', that is continuous small changes or 'step', that is, radical shift from
current to new processes; and
 is interdependent on organisational environment or culture

Change of whatever form interfaces with three organisational components which effectively
constitute the corporate culture. Change management must take into account each of the
three components, namely
 the historical and political evolution of the company;
 the management and organisation of the company; and
 the people who work for the company.

History and Politics: The historical and political evolution of a company will have a
significant bearing on its acceptance of change. The following questions will be among
those to be considered when planning for change:

 Where do the origins of the company lie and what are the associated values? What
image does the company like to promote? What perception of the company do
customers hold? Are any of these compromised by the proposals for change?
 What are the origins of individuals within the company? Have they had good or bad
previous experience of change on which their reactions to new change proposals will
be based?
  What are the traditions and norms to which management and employees alike have
become accustomed? What long-standing policies and 'rights', both written and
unwritten, exist? Are any of these threatened?
 What is the relationship between the 'powers' within the organisation and those
charged with effecting the change? Will these powers 'own' the change?
 What will be the effect of the change on the 'balance of power' as measured in terms
of current owners of resources and expertise? Who will be the 'winners' and 'losers'?
 Who are the 'winners' and 'losers' in terms of personal status (grade, status symbols,
and spheres of influence)?
 In essence. who are the parties most impacted by the change? Will they resist the
change and. if they do, how significant will their influence be on the effective
introduction of the change?
Management and Organisation: Change will invariably impact the roles of management
and the structure and operation of the organisation. Some of the most likely impacts of
modern-day change are:
 Senior management take a more strategic stance, encouraging opportunities for
progress through innovation and recognising the contribution to achievement of
business objectives;
 The role of line management shifts from that of 'autocrat' to that of facilitator';
 Boundaries between jobs, divisions, and departments become blurred;
 Jobs broaden both in terms of scope and of accountability with the requirement for
specialists decreasing and the demand for the multi-skilling increasing;
 Project and group work both increase;
 Increased harnessing of technology and improving processes reduce the total
availability of jobs
 Employees are required to be 'customer-facing' in respect of activities and outputs

Before embarking upon a significant change, it is therefore vital to gauge what proportion of
the workforce is able to cope with such shifts and, more importantly, is willing to make the
transition required.

People -Although identified against alternative headings, it must be pointed out that every
single issue noted above is in fact a 'people' issue. It is impossible to invoke even the most
modest of changes without impacting the manner in which someone works. Thus, it is
appropriate simply to add a small number of cautionary prompts for those invoking change:

 Even for the smallest of changes, don't underestimate the reactions of those
impacted;
 Recognise that typically with change there comes an expectation of a reward for
acceptance in terms of pay, promotion, or other form of recognition;
 Think through carefully the impact of the change on every job it affects.

Each of the above should be considered alongside the key issue of the manner in which the
change will be determined and invoked. Is the process of change to be fully participative, to
be consultative or merely to be communicated as a fait accompli? (Something that has already
happened in the past and cannot be change now)

Change agent, change intervention, and change targets are the related terms which need
clarification. Change agent is the person (or persons) who acts as a catalyst, and assumes
the responsibility for managing the change process. Change intervention is a planned action
to make things different. Change targets are individuals and groups who are subject to
change.
TYPES OF ORGANIZATIONAL CHANGE:
For organizations, the last decade has been fraught with restructurings, process
enhancements, mergers, acquisitions, and layoffs—all in hopes of achieving revenue growth
and increased profitability.

While the external environment (competitive, regulatory, and so on) will continue to play a
role in an organization's ability to deliver goods and services, the internal environment within
the organization will increasingly inhibit it from delivering products required to meet the
demands of the marketplace unless it is able to adapt quickly. The major areas of changes in
a company's internal environment include:

Strategic: Sometimes in the course of normal business operation it is necessary for

management to adjust the firm's strategy to achieve the goals of the company, or even to
change the mission statement of the organization in response to demands of the external
environments. Adjusting a company's strategy may involve changing its fundamental
approach to doing business: the markets it will target, the kinds of products it will sell, how
they will be sold, its overall strategic orientation, the level of global activity, and its various
partnerships and other joint‐business arrangements.

Structural: Organizations often find it necessary to redesign the structure of the company
due to influences from the external environment. Structural changes involve the hierarchy of
authority, goals, structural characteristics, administrative procedures, and management
systems. Almost all change in how an organization is managed falls under the category of
structural change. A structural change may be as simple as implementing a no‐smoking
policy, or as involved as restructuring the company to meet the customer needs more
effectively.

Process‐oriented: Organizations may need to reengineer processes to achieve optimum

workflow and productivity. Process‐oriented change is often related to an organization's
production process or how the organization assembles products or delivers services. The
adoption of robotics in a manufacturing plant or of laser‐scanning checkout systems at
supermarkets are examples of process‐oriented changes.

People‐centered: This type of change alters the attitudes, behaviours, skills, or

performance of employees in the company. Changing people‐centered processes involves
communicating, motivating, leading, and interacting within groups. This focus may entail
changing how problems are solved, the way employees learn new skills, and even the very
nature of how employees perceive themselves, their jobs, and the organization.

Some people‐centered changes may involve only incremental changes or small

improvements in a process. For example, many organizations undergo leadership training
that teaches managers how to communicate more openly with employees. Other programs
may concentrate on team processes by teaching both managers and employees to work
together more effectively to solve problems.
Remember that strategic, structural, process‐oriented, and people‐centered changes occur
continuously in dynamic businesses. Often, changes in one of these areas impact changes
in the other areas.

Many employees believe that a change is often reactive and nothing more than a quick fix;
then they brace themselves for more changes in the future. Management needs to realize
that serious underlying problems in organizations must be addressed with long‐term
consequences in mind. Thus, when management implements changes, careful thought must
be given to ensure that the new processes are for the long‐term good of the company.
FORCES FOR CHANGE IN ORGANISATIONS
Change has become the norm in most organisations. Business failures, plant closures,
mergers and acquisitions, downsizing, re-engineering, productivity improvement,
globalisation, cycle-time reduction, and other efforts for survival are common among most
Indian companies. Organisations. are in a state of tremendous turmoil and transition and all
members are affected.
The changes that have been listed above stem from several sources. Some of these are
external, arising from outside the organisation, whereas others are internal, arising from
sources within the company.

CAUSES FOR CHANGE

External causes Internal causes

Globalisation Organisational silence
Workforce diversity Falling effectiveness
Technological change Crisis
Managing ethical behaviour Changing employee expectations
Government policie Change in the work climate
Competition
Scarcity of Resources

EXTERNAL FORCES

Globalisation, workforce diversity, technological change, managing ethical behaviour,

government policies, competition, and scarcity of resources are the major external forces
demanding change.

Globalisation: The major players in the global market are the multinational corporations
(MNCs). MNCs seek entry in the Indian market through joint ventures. P&G, the American
fast moving consumer goods giant, entered a joint-venture with Godrej in 1992. As soon as
the alliance became operational, P&G engineers introduced new systems such as Good
Manufacturing Practices and Materials Resource Planning in Godrej plants. The two
companies exhibited a considerable amount of sensitivity to cultural differences between
them. It is a different matter that the alliance was terminated in 1996. But the point to be
noted is that the joint venture ushered in several structural changes in the alliance partners,
particularly in Godrej.
Globalisation has made organisations to rethink the boundaries of their markets and to
encourage their employees to think globally. Globalising an organisation means rethinking
the most efficient ways to use resources, gather and disseminate information, and develop
people to become global citizens.

Workforce Diversity: Related to globalisation is workforce diversity which is a powerful

external force invoking change. Diversity makes an organisation reposition itself, reposition
its strategy from a brick-and-mortar to an e-commerce environment, launch a new project,
create a new idea, develop a new marketing plan, design a new operation, and assess
emerging trends from a new perspective." All these involve considerable change.

Technological Change: Technological innovations bring about profound change because

they are not just changes in the way work is performed. Instead the innovation process
promotes associated changes in work relationships and organisational structures.
Technological innovators result in flatter structures, decentralised decision making, and
more open communication across the employees.
Managing Ethical Behaviour: Recent scandals have brought the issue of ethical behaviour
in organisations to the forefront of public consciousness. Ethical issues, however, are not
always public and monumental. Employees face ethical dilemmas in their daily work lives.
The need to manage ethical behaviour has brought about several changes in organisations.
Most centre around the idea that an organisation must create a culture that encourages
ethical conduct."
Ethical behaviour should touch such areas as product safety, employee health, sexual
harassment, AIDS in the workplace, smoking, acid rain, affirmative actions, waste disposal,
foreign business practices, cover-ups, employee privacy, dumping, transfer pricing,
inappropriate gifts, security of company records, lay-offs, and the like. Strategies covering
these and other areas need to be formulated and implemented keeping ethical implications
in mind.

Others: The other external forces invoking change include changes in government policies,
competition, and scarcity of resources. These are too self-evident, needing any clarification.

INTERNAL FORCES
Internal forces that trigger change are several. Employers hope that employees will
recognise and report problems that must be addressed. In some organisations, however,
there is a norm of organisational silence in which employees avoid bringing up certain
issues, even when everyone is aware that a problem does exist.
Organisational Silence Is A Big Barrier To Change

Why is change so difficult in organisations? A paradox is seen in many companies because

most employees know the truth about issues and problems within the company, yet dare not
talk about these problems with supervisors. This is supported by research and by members
of organisations, yet we know little about why this occurs.
Researchers have labelled this phenomenon as organisational silence: the dominant choice
within organisations, wherein employees withhold their opinions and concerns about
organisational problems. This is a potentially dangerous impediment to change in
organisations and yet it occurs even now, when managers are trying to empower employees
and open the lines of communication.
Researchers conducted an extensive review of studies to build a model of why
organisational silence occurs. It is more likely to happen when managers are dissimilar with
respect to employees, when decision making is centralised, and when managers tend to
reject negative feedback. Other conditions that promote organisational silence include
beliefs that employees are self-interested, that management knows best and that unity is
good but dissent is bad.
Researchers also studied the effects of organisational silence. They concluded that low
internal motivation, low satisfaction, turnover, sabotage, and stress all go hand-in-hand with
organisational silence. The biggest effect is little organisational change, or less effective
change processes.
Given the potentially devastating effects of organisational silence; why is it such a common
problem? Its dynamics are hidden. Organisational silence occurs when everyone knows it's
risky to tell the truth and this fact itself cannot be discussed.

FALLING EFFECTIVENESS is another internal trigger for change. An organisation that

experiences its third quarterly loss within a fiscal year is motivated to do something about it.
Some companies react drastically resorting to lay-offs, cost-cutting programmes, and the
like. Some others look at the bigger picture, view the loss as symptomatic of an underlying
problem, and seek causes for the problem.
A CRISIS may also instigate change in an organisation. Strikes may compel employers to
resort to pay cuts. The resignation of a key executive may cause the company to rethink the
composition of its management team and its role in the organisation.
DIFFERING EMPLOYEE EXPECTATIONS can also trigger change in organisations.
Expectations of young and newly hired employees are different than those of old
employees. Youngsters are more career-oriented than their old counterparts and are known
for organisational restlessness. Retaining and motivating such employees is a challenge for
any firm.
CHANGE IN THE WORK CLIMATE of an organisation can stimulate change. A workforce
that seems lethargic, apathetic, and dissatisfied is a symptom that must be addressed. This
symptom is common in organisations that have experienced lay-offs. Workers who have
escaped a lay-off may grieve for those who have lost their jobs and may find it hard to
continue to be productive. They may feel that they will also be laid-off one day, and feel
insecure in their jobs.
It may be stated that the forces for change may be planned or unplanned. Global
competition, government policies, scarcity of resources, changed employee expectations,
falling effectiveness and technological advances take organisations by surprise.
Organisations must be prepared to face such unplanned changes.
Quite often, organisations make changes that are carefully planned and deliberate. Strategic
planning is the term used to describe planned change. Strategic planning may involve
changes in the organisational structure, products and services, acquisitions and mergers,
hiving off unrelated/ unprofitable business lines and the like.

IMPLIMENTING ORGANIZATIONAL CHANGE:

1. Management Support for Change

Employees develop a comfort level when they see management supporting the process. It is
critical that management shows support for changes and demonstrates that support when
communicating and interacting with staff

2. Case for Change

No one wants to change for change sake, so it is important to create a case for change. A
case for change can come from different sources. It can be a result of data collected on
defect rates, customer satisfaction surveys, employee satisfaction surveys, customer
comment cards, business goals as a result of a strategic planning session, or budget
pressures.
Using data is the best way to identify and justify areas that need to improve through change
initiatives

3. Employee Involvement
All change efforts should involve employees at some level. Organizational change, whether
large or small, needs to be explained and communicated, specifically changes that affect
how employees perform their jobs.

4. Communicating the change:

Whether it is changing a work process, improving customer satisfaction, or finding ways
to reduce costs, employees have experiences that can benefit the change planning and
implementation process. Since employees are typically closest to the process, it is important
that they understand the why behind a change and participate in creating the new process.
5. Implementation
Once a change is planned, it is important to have good communication about the roll-out and
implementation of the change. A timeline should be made for the implementation and
changes should be made in the order of its impact on the process and the employees who
manage that process. For instance, if your organization is upgrading its software program,
employee training should be done before the software is installed on their computers.
An effective timeline will allow for all new equipment, supplies, or training to take place
before it is fully implemented.

6. Follow-up
Whenever a change is made it is always good to follow-up after implementation and assess
how the change is working and if the change delivered the results that were intended.
Sometimes changes exceed target expectations but there are occasions that changes just
don’t work as planned. When this is the case, management should acknowledge that it didn’t
work and make adjustments until the desired result is achieved.

7. Removing Barriers
Sometimes employees encounter barriers when implementing changes.Barriers can be with
other employees, other departments, inadequate training, lacking equipment, or supply
needs. Sometimes management also needs to deal with resistant or difficult employees. It is
management’s responsibility to ensure that employees can implement change without
obstacles and resistance.
It is unfortunate but there are times when employees simply can’t accept a change. In these
rare cases, employees simply need to move on in order to successfully implement a needed
change. These are difficult but necessary decisions.

8. Measure the change process.

Throughout the change management process, a structure should be put in place to measure
the business impact of the changes and ensure that continued reinforcement opportunities
exist to build proficiencies. You should also evaluate your change management plan to
determine its effectiveness and document any lessons learned.

9. Celebrate
It is important to celebrate successes along the way as changes are made. Celebrating the
small changes and building momentum for bigger changes are what makes employees want
to participate in the process. When employees understand why a change is made and are
part of the process for planning and implementing the change, it allows for a better chance
for successful implementation.

10. Provide effective training.

With the change message out in the open, it’s important that your people know they will
receive training, structured or informal, to teach the skills and knowledge required to operate
efficiently as the change is rolled out. Training could include a suite of micro-learning online
modules, or a blended learning approach incorporating face-to-face training sessions or on-
the-job coaching and mentoring.

HOW TO OVERCOME THE RESISTANCE TO CHANGE:

According to Kotter and Schlesinger (1979) proposed six crucial techniques for
overcoming the resistance to change. These are given below:

1. Widespread Education and Improving Communication

2. Facilitating Participation and involvement
3. Support and Facilitation
4. Agreement & Negotiation
5. Co-optation & Manipulation
6. Coercion-Both Explicit and Implicit

1. Education and Effective Communication: This is one of the commonest

techniques for minimizing resistance to change by educating people and promoting
awareness through effective communication regarding the benefits of a planned
change. By explaining the need for change and the objectives of change, the
management can gain the much-needed support from the team members and facilitate
its smoother implementation.
With the help of two-way communication, the employee’s queries and oppositions
related to various aspects of change can be quickly addressed and thereby, minimize
the objections or hassles which may come across in the path of implementation of
change.
Given below are the important principles which are related to the communication of
change and require a lot of attention while implementation a planned change:
1. A large-scale planned change can be effective and yield successful outcomes
only if it involves two-way communication efforts. Only top down communication
or one-way communication will fail to attract the desired commitment from the
staff members.
2. The staff members do have a preference for being communicated about the
change on face to face basis from their immediate supervisors.
3. According to Beckhard & Pritchard 1992; Robbins et al. 1998; Ivancevich &
Matteson 1996, employees prefer a consultation and involvement in the change.
Few important things which should be essentially followed while implementing an
organization-wide change are:
4. Avoid sending emails or memo for informing the employees regarding a
change initiative and expect that the employees will be able to understand and
accept it readily.
5. Invite the suggestions and feedback from the staff members, involve them in
the process and encourage their participation for effective results.
6. Communicate with people regularly by engaging in face to face interactions
with them both individually and in groups and provide them opportunities for
discussion.

2. Facilitating Participation and Involvement: This technique gives a lot of

importance to involving the resistors in the change process by setting up a collaborative
environment and implementing the change in consultation with the staff. It is a
constructive strategy and can be beneficial in minimizing the resistance to change by
involving the employees and seeking their participation in the entire process.

3. Support and Facilitation: Employees fear or resist change due to a number of

reasons as a result of which they pose a resistance or oppose any kind of
transformation in the existing ways of work or methods. The employees look for
complete emotional support and facilitation for being able to cope up with the
challenges resulting from the change and should be allowed to express their fear,
resentment or anger in connection with the change and the challenges of change.
4. Agreement & Negotiation: This technique involves negotiating or bargaining with
the resistors on various aspects related to the change and making trade-offs so that the
concerns of the resistors and the management are both being given due consideration
and importance.

5. Co-optation & Manipulation: This technique involves getting the support,

persuading or influencing the employees in favour of the change. Manipulation involves
covert attempts from the managers by withholding painful information, twisting or
distortion of the information for making it more appealing for the staff members or
spreading false rumours across the organization in order to compel the employees to
accept the change manipulatively.
Alternately, the managers can depend on staff polling strategy and make an attempt
towards persuading the resistors to join the rest of the group. The management may
even co-opt an individual and assign certain important responsibilities in connection with
the implementation of change.

6. Coercion: Implicit and Explicit: Coercion involves exercising force or threat for
making the change accepted and followed by the employees. This strategy emphasizes
more on the use of fear by way of direct or indirect threats and involves harassment,
bullying or compels the employees to act in accordance with the expected ways or else
resign. This strategy is illegal, ineffective and in the long-run, will result in mass
resentment, dissatisfaction, high rate of absenteeism, low productivity and ultimately
high employee turnover.

APPROACHES TO MANAGE ORGANIZATIONAL CHANGE:

Now we turn to several approaches to managing change: Lewin’s classic threestep model of
the change process, Kotter’s eight-step plan, action research, and organizational
development.

LEWIN’S THREE-STEP MODEL:

Kurt Lewin developed a change model involving three steps: unfreezing, changing and
refreezing. The model represents a very simple and practical model for understanding the
change process. For Lewin, the process of change entails creating the perception that a
change is needed, then moving toward the new, desired level of behavior and finally,
solidifying that new behavior as the norm. The model is still widely used and serves as the
basis for many modern change models.
Unfreezing

Before you can cook a meal that has been frozen, you need to defrost or thaw it out. The
same can be said of change. Before a change can be implemented, it must go through the
initial step of unfreezing. Because many people will naturally resist change, the goal during
the unfreezing stage is to create an awareness of how the status quo, or current level of
acceptability, is hindering the organization in some way. Old behaviours, ways of thinking,
processes, people and organizational structures must all be carefully examined to show
employees how necessary a change is for the organization to create or maintain a
competitive advantage in the marketplace. Communication is especially important during the
unfreezing stage so that employees can become informed about the imminent change, the
logic behind it and how it will benefit each employee. The idea is that the more we know
about a change and the more we feel it is necessary and urgent, the more motivated we are
to accept the change.
Changing
Now that the people are 'unfrozen' they can begin to move. Lewin recognized that change is
a process where the organization must transition or move into this new state of being. This
changing step, also referred to as 'transitioning' or 'moving,' is marked by the
implementation of the change. This is when the change becomes real. It's also,
consequently, the time that most people struggle with the new reality. It is a time marked
with uncertainty and fear, making it the hardest step to overcome. During the changing step
people begin to learn the new behaviours, processes and ways of thinking. The more
prepared they are for this step, the easier it is to complete. For this reason, education,
communication, support and time are critical for employees as they become familiar with the
change. Again, change is a process that must be carefully planned and executed.
Throughout this process, employees should be reminded of the reasons for the change and
how it will benefit them once fully implemented.
Refreezing
Lewin called the final stage of his change model freezing, but many refer to it as refreezing
to symbolize the act of reinforcing, stabilizing and solidifying the new state after the change.
The changes made to organizational processes, goals, structure, offerings or people are
accepted and refrozen as the new norm or status quo. Lewin found the refreezing step to be
especially important to ensure that people do not revert back to their old ways of thinking or
doing prior to the implementation of the change. Efforts must be made to guarantee the
change is not lost; rather, it needs to be cemented into the organization's culture and
maintained as the acceptable way of thinking or doing. Positive rewards and
acknowledgment of individualized efforts are often used to reinforce the new state because it
is believed that positively reinforced behavior will likely be repeated.
Some argue that the refreezing step is out-dated in contemporary business due to the
continuous need for change. They find it unnecessary to spend time freezing a new state
when chances are it will need to be re-evaluated and possibly changed again in the
immediate future. However - as I previously mentioned - without the refreezing step, there is
a high chance that people will revert back to the old way of doing things. Taking one step
forward and two steps back can be a common theme when organizations overlook the
refreezing step in anticipation of future change.

KOTTER’S EIGHT-STEP PLAN FOR IMPLEMENTING CHANGE:

There are many theories about how to "do" change. Many originate with leadership
and change management guru, John Kotter. A professor at Harvard Business School
and world-renowned change expert, Kotter introduced his eight-step change process
in his book.

Step 1: Create Urgency

For change to happen, it helps if the whole company really wants it. Develop a sense of
urgency around the need for change. This may help you spark the initial motivation to get
things moving.
This isn't simply a matter of showing people poor sales statistics or talking about increased
competition. Open an honest and convincing dialog about what's happening in the
marketplace and with your competition. If many people start talking about the change you
propose, the urgency can build and feed on itself.
Step 2: Form a Powerful Coalition
Convince people that change is necessary. This often takes strong leadership and visible
support from key people within your organization. Managing change isn't enough – you have
to lead it.
You can find effective change leaders throughout your organization – they don't necessarily
follow the traditional company hierarchy. To lead change, you need to bring together a
coalition, or team, of influential people whose power comes from a variety of sources,
including job title, status, expertise, and political importance.
Once formed, your "change coalition" needs to work as a team, continuing to build urgency
and momentum around the need for change.

Step 3: Create a Vision for Change

When you first start thinking about change, there will probably be many great ideas and
solutions floating around. Link these concepts to an overall vision that people can grasp
easily and remember.
A clear vision can help everyone understand why you're asking them to do something. When
people see for themselves what you're trying to achieve, then the directives they're given
tend to make more sense.

Step 4: Communicate the Vision

What you do with your vision after you create it will determine your success. Your message
will probably have strong competition from other day-to-day communications within the
company, so you need to communicate it frequently and powerfully, and embed it within
everything that you do.
Don't just call special meetings to communicate your vision. Instead, talk about it every
chance you get. Use the vision daily to make decisions and solve problems. When you keep
it fresh on everyone's minds, they'll remember it and respond to it.
It's also important to "walk the talk." What you do is far more important – and believable –
than what you say. Demonstrate the kind of behavior that you want from others.

Step 5: Remove Obstacles

If you follow these steps and reach this point in the change process, you've been talking
about your vision and building buy-in from all levels of the organization. Hopefully, your staff
wants to get busy and achieve the benefits that you've been promoting.
But is anyone resisting the change? And are there processes or structures that are getting in
its way?
Put in place the structure for change, and continually check for barriers to it. Removing
obstacles can empower the people you need to execute your vision, and it can help the
change move forward.

Step 6: Create Short-Term Wins

Nothing motivates more than success. Give your company a taste of victory early in the
change process. Within a short time frame (this could be a month or a year, depending on
the type of change), you'll want to have some "quick wins" that your staff can see. Without
this, critics and negative thinkers might hurt your progress.
Create short-term targets – not just one long-term goal. You want each smaller target to be
achievable, with little room for failure. Your change team may have to work very hard to
come up with these targets, but each "win" that you produce can further motivate the entire
staff.

Step 7: Build on the Change

Kotter argues that many change projects fail because victory is declared too early. Real
change runs deep. Quick wins are only the beginning of what needs to be done to achieve
long-term change.
Launching one new product using a new system is great. But if you can launch 10 products,
that means the new system is working. To reach that 10th success, you need to keep
looking for improvements.

Each success provides an opportunity to build on what went right and identify what you can
improve.

Step 8: Anchor the Changes in Corporate Culture

Finally, to make any change stick, it should become part of the core of your organization.
Your corporate culture often determines what gets done, so the values behind your vision
must show in day-to-day work.
Make continuous efforts to ensure that the change is seen in every aspect of your
organization. This will help give that change a solid place in your organization's culture.

It's also important that your company's leaders continue to support the change. This includes
existing staff and new leaders who are brought in. If you lose the support of these people,
you might end up back where you started.

LEADING THE CHANGE PROCESS:

1. Establish that the change is necessary

Your team should understand that this change is urgent and permanent. That is, it’s not
something that will wash away in a week. Helping others see how the change you’re
implementing will impact them is a good start.

For instance, if it’s an adjustment to the corporate culture, everyone should see how the
update will promote happiness and success.

2. Work with a reliable group of people

As John P. Kotter notes, it’s key to have influencers in the organization coordinate
change. A powerful guiding coalition ensures that major changes are communicated to
every department. That way, no one is left out and expectations are clear.

3. Be purposeful with your planning

With so much to do, it’s easy to get sidetracked with other less important tasks or pay
attention to the wrong details. Whenever you sit down to think about your change
efforts, make sure you’re doing strategic planning.
Evaluate how your reengineering will go in the present and what sort of future
implications they may have. If you need to, consult stakeholders or other confidants you
have.

4. Identify your barriers and remove them

You might find that previous practices or rules don't serve your business anymore as
you lead change management. Leaders within your team may need to move to different
departments so that their talents are better used. Or, you may find you need to
implement new systems to keep things organized.

Don’t force employees to change projects abruptly, but let them know you’ll be changing
leadership to align with your vision.

If the barriers in your workplace slow down your progress toward effective change, you
must figure out how to remove them. Working with your team members on solutions that
benefit everyone is a great way to tackle issues.
5. Value your company culture
A company always has a culture that might have strong foundations, but that doesn’t
mean it isn’t time for a cultural change. If your employees benefit from the present
attitudes and values, make sure you respect that. If transforming the culture is needed,
lead by example and demonstrate new behaviour.

Getting in touch with human resources will ensure that everyone understands the new
organizational culture.

6. Celebrate your short-term wins

Any wins count as progress. They should be recognized and shared with the rest of
your team because it demonstrates that your change is working. Celebrating wins
boosts morale amongst your team. Plus, it motivates others to be more productive while
tracking your progress and helping you plan for the future.

FACILITATING CHANGE:
Managing change successfully is one of the tasks faced by today’s organizations. A number
of individuals are involved in implementing, facilitating and stabilizing the change process in
the organizations. Those who manage these changes could be from within the concerned
organizations or from outside as consultants. They are known as the change agents or
change leaders who provide invaluable contribution to the successful change process.
Change agent is “A professional Person who influences innovations, decisions in a direction
deemed desirable by a change agency” (Roger and Shoemaker, 1971). Change agents are
individuals who use their knowledge of the change process to influence decisions thereby
ensuring desirable change. In a landmark study of organization change, based on a review
of 18 case studies, Larry E. Greiner found (Patterns of Organization Change, Harvard
Business Review, May-June, 1967) that the more successful change attempts involved six
major steps:

Pressure and Arousal:

This is the initial stage that indicates the need to shake the power structure at its very
foundation. Without this shake-up, the top management is unlikely to be aroused sufficiently
to accept the need for change. The pressure could come from either external forces like
competitor breakthroughs or stockholder discontent, or internal events like interdepartmental
conflict, decreased productivity, or a union strike.

Intervention and Re-orientation:

Pressure does not necessarily guarantee action by the top management. It often requires
intervention by an external force. This step usually involves bringing in a newcomer, an
outside consultant, who has a more objective view point, can appraise organizational needs,
and can reorient the thinking of top management by getting them to re-examine their
practices and procedures, thereby helping them to define the real problem.

Diagnosis and Recognition:

This stage involves the existing power structure at all levels, in collaboration with the
newcomer or consultant, helps the organization do a better job of “seeking the location and
causes of problems”. In the more successful cases of organization change, a shared rather
than a unilateral or delegated approach to locate problem areas seems to have ensured
better results. In the unilateral approach, the top brass makes the decisions; in the delegated
approach, top management delegates, but remains involved.

Invention and Commitment:

With the identification of the problem areas, the search for solutions starts. Generally, the
temptation is to try old solutions to new problems. In this fourth phase, what is required is the
invention of new and unique solutions that have commitment from the power structure. Here,
the newcomer in close cooperation with the top management and other staff try to develop
effective solutions to problems, using the shared approach to obtain full commitment to the
implementation of the new solution. Successful change approaches involve intensive
searches for new and innovative solutions which depend on the collaboration of many
people who provide their own solutions. In his study, Greiner found that none of the less
successful attempts at change, reached this stage and that rather than commitment, there
was serious resistance to the proposed changes. (In other words, the reactive forces
became stronger than the proactive forces).

Experimentation and Search:

The successful change approaches used “reality testing” to determine the usefulness of the
solution prior to the introduction of large-scale changes. In this phase, both the specific
decisions taken in the previous phase (solutions), but also the underlying pattern of decision-
making (shared power), were tested to establish their validity. In other words, the decision-
making process was tentative rather than final. Further, all the successful change studies
reported that the concept of shared power ensured that the change process did not confine
itself to the major decision areas, but encompassed a large number of minor decision areas
as well and at all levels of the organization.

Reinforcement and Acceptance:

Successful change leads to clear improvements in organizational performance, with
corresponding support for change from all levels of the organization. This positive impact of
change, particularly as it involved a sense of participation and experimentation testified to its
reinforcing effect and secured the support and encouragement and reward for those who
continued with change efforts.

DEALING WITH INDIVIDUAL AND GROUP RESISTANCE:

Individual sources of resistance towards a change exist in the basic human tenets or
characteristics and are influenced by the differences in perception, personal background,
needs or personality-related differences. It is important to understand those triggering factors
or issues which refrain individuals from endorsing change or extending their support and
cooperation towards any change initiatives at an organizational level.
Criticizing the individuals or the teams for not being supportive in the stages of transition or
compelling them cannot be an effective solution for implementing change smoothly or in a
hassle free manner.
The resistance towards change at an individual level can be due to various reasons:
 How satisfied they are with the existing state of affairs
 Whether they appreciate the overall end product of change and it’s outcome on them
 How much practical or realistic the change is
 What will be the possible cost change on the individual in terms of potential risks
involved, pressure to develop new competencies and disruptions
The following factors explain why individuals may pose resistance towards change:

 Habits: We individuals are influenced by our habits in our ways of working and
accept or reject a change depending upon the effect which a change may have on the
existing habits of the individuals.
For example, change in the office location might be subjected to resistance from the
individuals as this might compel them to change their existing life routine and create a
lot of difficulties in adjustment or coping with the schedule. The individuals might have
to drive a longer way for reaching their office, or start early from home for reaching
their office in time, etc.
  Lack of Acceptability or Tolerance for the Change: Some individuals endorse
change and welcome a change initiative happily while few individuals fear the impact
of change. Over a period of time change fatigue also builds up.
 Fear of a Negative Impact Economically or on the Income: During the process of
organizational restructuring or introduction of organization-wide change as a strategic
move on the part of the management, several inhibitions, and fear rule the thought
process of the individuals. Fear of possible loss of a job as a result of change or a
change in their income structure or may be a change in their work hours could be one
amongst the possible reasons.
 Fear of the Unseen and Unknown Future: Individuals develop inertia towards the
change due to the fear of unknown or uncertainties in the future. This can be tackled
through effective communication with the participants of change and making people
aware of the positives of change and the course of action which individuals are
expected to follow to cope with the changing requirements successfully.
 Fear of Losing Something Really Valuable: Any form of threat to personal security
or financial security or threat to the health of the individuals may lead to fear of losing
something precious as a result of the implementation of change.
 Selective Processing of Information: It can be considered as a filtering process in
which the individuals perceive or make judgments by gathering selective information
which is greatly influenced by their personal background, attitude, personal biases or
prejudices, etc. If an individual maintains a negative attitude towards any kind of
change, then they are having a usual tendency of looking at the negativities
associated with the change and involve all the positive aspects of it.
 A Rigid Belief that change cannot bring about any facilitating change in the
organization and it only involves the pain and threats to the individuals.

ORGANIZATIONAL FACTORS WHICH RESULT IN RESISTANCE TO CHANGE:

 Resistance Due to the Structural Rigidities or Limitations: Structural resistance is

a characteristic feature of bureaucracies, which focus more on stability, control, set
methodologies or routine.
 Ignoring all the interconnected factors which require change or lack of clarity in
understanding the ground realities.
 Inertia from the Groups: Groups may resist change because just like individuals,
groups equally follow set behavioural patterns, norms or culture and as a result of
change the groups might have to change their existing ways of conduct or behaviour.
 Possible threats to Power, Resources or Expertise can also result in resistance
towards an organization level change. Any kind of devolution of power or transfer of
resources from some agency or group to some other agency or a group will definitely
lead to a feeling of fear or inertia towards a change initiative.
In the end, it can be concluded that any kind of change will surely involve heavy resistance
at the individual as well as organizational level. But through effective communication during
all stages and consulting, desirable outcomes can be ensured by breaking all the possible
barriers or resistances towards a change. What is more important is identifying the main
source of resistance and accordingly developing action plans for dealing with it.

Successful change in an organization will require strong commitment and involvement on the
part of the top management, focused and an integrated approach, strong and a stable
leadership, effective and open communication from the internal change agent for making
people sensitive and more aware of the realities and the ultimate need for change.

For minimizing the resistance towards the change employee participation and involvement in
the overall process plays a crucial role in building acceptability and seeking the cooperation
of the employees towards the change. Hence proper planning, coordinated approach and
complete involvement of all the stakeholders, play a decisive role in implementing strategic
decisions and determining the success of change.

INTERVENTION STRATEGIES FOR FACILITATING ORGANIZATIONAL CHANGE:

An important first step in building organizational change capacity is to understand the nature
of change and the various ways in which it can be dealt with, with the goal of enhancing the
willingness and ability of organizational members to change.

LEVEL FOCUS ILLUSTRATIVE ACTIONS

Micro Developing an Adopt a common, enterprise-wide framework for

understanding and thinking and talking about change
acceptance of Develop widespread knowledge about different
different change approaches to change and when each is appropriate
approaches Develop deep expertise about change in the
organization
Provide change coaching and consulting services
Establish change agent networks to share best
practices, tools and insights about changing
Debrief change initiatives with a focus on learning
from experience
Enhancing Select, hire, evaluate and reward people based on their
willingness and ability to thrive on change
ability to change Form diverse teams to encourage innovation and
creativity
Develop, reward and promote supervisors and
managers who enable change
Enhance the personal credibility of organizational
leaders
Listen to, encourage, and reward mavericks and
trailblazers
Create a climate of trust, honesty, and transparency
Meso Building a change- Frequent meetings to identify and critically assess
supportive opportunities
infrastructure Encourage low-cost experiments with new ideas
Recognize and reward those who support, encourage,
lead and share learning about change
Creation of a fluid structure that allows the easy
formation of new groups
Creation of systems to share knowledge, information
and learning across boundaries
Responsive and proactive training and education
Providing Designate an owner of the goal to develop change
appropriate capacity
resources Devote resources to continually scanning the
environment for new ideas
Encourage external contact with stakeholders,
especially with customers
Appoint committed change sponsors for specific
initiatives
Target key change initiatives with enough resources to
get public successes
Shelter breakthroughs with their own budgets and
people
 Macro Creating a Emphasize learning and information sharing
change-facilitative Encourage questions and experiments
culture Valuing alternative viewpoints Tolerance for
mistakes in the interest of learning
Stakeholder orientation
Shared purpose with a common language about
change
Ensuring on-going Creating a shared purpose
strategizing Thinking dynamically and systemically so that
strategies can change quickly
Examining future markets, competitors, and
opportunities
Factoring future scenarios into today’s decisions
Stringing together a series of momentary advantages
Creating and communicating a change friendly identity
both internally and externally

METHODS OF IMPLEMENTING ORGANIZATIONAL CHANGE:

Successful change management requires implementing multiple phases to ensure the
transition runs smoothly. By following these eight steps, you can keep your business on
track while achieving a transition:

1. Identify the change and perform an impact assessment

To begin, you should first identify the necessary change and make sure that it aligns with
your company’s overall objectives. Once you identify your goal, perform an impact
assessment to evaluate how the change will affect all levels of your organization. This
assessment will provide guidelines on how to implement the change because it shows who
faces the most impact and will need the most support or training.

2. Develop a plan
Use the insights you gained in the preparation phase to determine how to implement the
changes needed. Create a plan that sets the direction for your organization, including how to
achieve the necessary changes and ways to measure whether the changes were successful
Depending on the scope of the change you implement, you may need to include a plan on
how you will support employees through this transition. Your impact assessment identified
the most impacted employees, so your implementation plan also needs to include any type
of support or training that these employees may need. Things to consider include mentorship
programs, cross-training plans and open-door policies where employees can ask for
assistance and receive clarification.

3. Communicate the change to employees

To effectively convey the change to employees, you’ll need to develop a communications
strategy. In this plan, outline your main messages, identify your audience and determine who
or what medium will deliver this information. Depending on the change, you may also need
to consider how management will respond to resistance or feedback from employees. Due to
your impact assessment, you will likely already know which level of the organization will be
affected most by the change. It is recommended that you communicate with these
employees first and most often.

4. Provide reasons for the change

To gain the support of employees when implementing change, you must demonstrate the
necessity of the change. Often, the best way to achieve this is to present data that supports
your decision. Such data may involve customer or employee surveys, strategic business
goals or budget plans. Remember to underscore the benefits the change implementation will
bring. Employees who understand why the change is happening may be more likely to feel
motivated to actively participate in the change.

5. Seek employee feedback

After communicating the change to employees, offer them the opportunity to provide
feedback. You can either schedule times to conduct in-person feedback sessions or send
out surveys. Change can make some people nervous, so allowing employees to voice their
opinions makes them feel like part of the decision or conversation. You may even gain
insights into how to improve your implementation plans. Encouraging employees to voice
their concerns also allows the opportunity to clear up any misunderstandings and answer
any lingering questions.

6. Launch the change

Effective change happens in stages, which ensures that employees are not overwhelmed.
Create a timeline that starts with the aspects that you must complete first, such as employee
training, equipment acquisition or software installation. It’s helpful to set a deadline for when
you want to evaluate the implementation process and determine whether it achieved your
intended goals. Depending on how much time you have to implement change, you may want
to consider a pilot program. By having a small group of employees test the change before
you implement it company-wide, you increase the likelihood of a successful change.

7. Monitor the change

As you implement change throughout an organization, continue to monitor the process to
ensure all of your employees follow proper implementation procedures. Depending on your
role, you may directly observe employees or delegate the tasks to other supervisors. Try to
monitor progress on at least a weekly basis—toward the beginning of implementation, you
may even want to review progress daily. Keeping a close watch on your progress will help
you fix any mistakes you hadn’t anticipated and gauge any other unexpected outcomes from
the change.

8. Evaluate the change

Work with your employees or team to determine how you will measure the success of the
implementation. In some situations, you may have quantifiable results that can be easily
measured. If you don’t have quantifiable data to work with, you may want to brainstorm other
ways of measuring success. For instance, you could consider the following points:

What was the goal of this change

What should success look like, given our starting-point goal
Which areas of our business have improved since the change was implemented
Are there any areas that have reduced their productivity

During the planning phase, you set a deadline to evaluate the implementation. When you
reach this deadline, meet with your team to assess the results based on your established
guidelines for measuring success. Determine whether the changes met your business goals
or made progress toward them. You can also discuss whether the change implementation
process worked as intended and determine whether you need to make any improvements.
Share the results of your discussion with employees — seeing that they made progress or
achieved goals can help motivate them at work.
DEVELOPING A LEARNING ORGANIZATION:

LEARNING ORGANISATION
In the competitive environment of the present millennium, only a learning organisation will
survive. Its abilities to learn, create, codify, and utilise knowledge faster than its rivals and
quicker than the environment changes will provide tomorrow's corporation a competitive
edge that is sustainable for ever. Indeed, since the core competence of any organisation is
nothing but the individual and collective learning of all its people, corporation of the coming
age must be built around people.

A learning organisation is understood as the one that has developed the capacity to adapt
and change. Learning organisations, like individuals, constantly learn. In a learning
organisation, old shibboleths are demolished and a new order is created a new order that
not only encourages managers to look at their people differently, but actually teaches them
to look at the world afresh. Characteristics of the Learning Organisation: One of the
leaders in the field of the learning organisation is Senge. His book, The Fifth Discipline, puts
forward a view that the old methods and procedures of quality improvement, learning from
mistakes, and the like are insufficient to enable organisations to survive in the future. Senge
puts forward five 'compact technologies' as prerequisites if an organisation wishes to
become learning focused.

(i) System thinking: Managers need to be aware of the open linkages between their own
actions and the actions of those around them, within and outside the organisation.
Senge's view is that managers do not fully grasp a system's perspective because they
only perceive and act upon one aspect of a problem rather than understand the broader
perspective.

(ii) Personal mastery: Organisations need to encourage their employees to continually

learn and improve their own skills and abilities. Traditionally organisations have sought
to train and develop a select few with the rest placed on a career 'scenic routine'. Senge
argues that organisations have wasted a valuable resource by not encouraging all
individuals to become constant learning organisms.

(iii) Mental models: Mental models are deeply embedded assumptions and generalisations
we all carry regarding how the world works and our own actions. It is often
subconscious, yet can influence our behaviour in organisations substantially. Senge's
view is that these mental models can serve as powerful constraints in an organisation's
ability to gain new insight and innovations.

(iv) Building shared vision: Senge has observed that, throughout history, a shared vision
has been a critical component to organisational success. There is an important
difference between a vision built around a charismatic leader - which is often transitory -
and that built around shared goals. For the development of a learning organisation, the
building and maintenance of a shared vision offers individuals the support to excel and
learn. To develop a shared vision involves communicating descriptions of what the future
might hold rather than seeking compliance to a prescribed view.

(v) Team learning: Working and sharing information among team-members is a vital
element of the learning organisation. Senge recognises that many teams exhibit signs of
negative synergy of groupthink. Senge stresses the need to overcome such difficulties
by encouraging meaningful dialogue. This is accomplished by seeking to suspend
assumptions and judgement and to engage in 'free-thinking' with other group members.
 TRADITIONAL VERSUS LEARNING ORGANIZATION

Function Traditional Organization Learning Organization

Determination of Vision is provided by the top There is shared vision that can emerge
overall direction management from many places, but top management is
responsible for ensuring that the vision
exists and is nurtured
Formulation and Top management decides what is Formulation and implementation of ideas
implementation of to be done and the rest of the take place at all levels of the organization
ideas organization acts on these ideas
Nature of Each person is responsible for Personnel understand their own job as
organizational his/ her own job responsibilities well as the way in which their own work
thinking and the focus is on developing inter-relates with and influences that of
individual competence other personnel.
Conflict Conflicts are resolved through Conflicts are resolved through the use of
Resolution use of power and hierarchical collaborative learning and the integration
influences of diverse viewpoints of personnel
throughout the organization
Leadership and The role of the leader is to The role of the leader is to build a shared
Motivation establish the organization’s vision, empower the personnel, inspire
vision, provide rewards and commitments and encourage effective
punishment as appropriate and decision making throughout the enterprise
maintain overall control of through the use of empowerment and
employee activities. charismatic leadership.

Creating the Learning Organisation: At least four sets of capabilities are needed to create a
learning organisation. They are:
(i) Capabilities of scanning necessary for exposing the organisations to new information
created internally or acquired externally.
(ii) Capabilities for self-reflection and problem-solving to enable the firm to interpret new
information and redefine business knowledge.
(iii) Capabilities to disseminate the new knowledge throughout the organisation so that it
becomes collective learning.
(iv) Capabilities to act and experiment to enable the organisation to practise the new
responses it has learnt.
In order to acquire and inculcate these traits in people, there is the need for a shift in the
mindset. In the meantime, managers may initiate action on the following lines to create a
learning organisation:

 Managers must be receptive to the new ideas and overcome the desire to closely
monitor and control operations.
 Systems thinking among managers in the organisation needs to be cultivated.
 It is necessary to keep the organisation in a state of constant change.
 Diversities need to be cultivated in the functioning of the organisations.
 Create mechanism to unlearn old and obsolete knowledge.
 Disseminate learning throughout the organisation systematically.
 Develop a sense of personal efficacy among organisational members.
Need for Learning Organisation: As the opening paragraph in this section shows, only a
learning organisation shall survive the emerging competitive global economy. A fundamental
revolution (in the form of learning organisation) in the theory and practice of management
may be vital for India's competitiveness. But even more important, it may prove vital for
harnessing the capacities of the Indians to grow and develop their country and address its
many critical social and business needs.

Learning organisation is essential because:

 Only it can survive tomorrow's knowledge-based economy.
 Only it can manage tomorrow's intense global competition.
 Only it can cope with tomorrow's rapid fire technological changes
 Only it can handle tomorrow's demanding and fragmented market
 Only it can build a people based work system in a company.