Unit-7 & 8

Change Management &

Organizational Development
What is Change?
Factors causing Change?
Cummins Worli Model of Change Management
Systems Model of Change
Kurt Lewin Model of Change Management
Resistance to Change
Managing the Change Process
Organizational Development and Change
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Management OD Interventions
 What is Change?
Change is concerned with making things
different.
“The coping process of moving from
present state to the desired state that
individual, groups and organization undertake
in response to dynamic internal & external
factors.”
A structured approach to transitioning
individuals, teams, and organizations from a
current state to a desired future state.
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 Change Forces

External
INTETRNAL FORCES Forces

Workforce Diversity Change Technology

 Change in Managerial forces Market Conditions
Personnel Social Changes
Management Structure Political Forces
 External Factors
Technology
• One of the major external force
• The adoption of new technology as computers,
telecommunication systems and flexible manufacturing
operations
• Wider spans of control for managers and flatter
organizations.
• Individuals and the organizations need to become more
adaptable
• Job Redesigning
• Multiple tasking , increased employee participate in
decision making.
• Increased investments in training & development 4
Market Conditions
• Market conditions are no more static.
• The changing needs, desires and expectations of the
customers
• Globalized market, global products & services and
global consumers
Social Changes
• Ongoing social and cultural environment changes
• Spread of education, knowledge
• Social equality, equal opportunities to women, equal
pay for equal work, has posed new challenges for the
management.
• The management has to follow certain social norms in
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shaping its employment, marketing and other policies.
Political Forces
• National and global political environment affects
every organization
• The corporate sector is regulated by a lot of laws
and regulations. The organizations do not have any
control over the political and legal forces, but they
have to adapt to meet the pressure of these forces.
• An organizations is also affected by the world
politics.

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 Internal Factors
Nature of the Work Force
• Demanding Workforce
• Workforce Diversity
• Changing Value System
• Younger Organization
• Increased Women Workforce
• Dual Career
Change in Managerial Personnel
• Frequent change in managerial personnel ( promotion, retirement, transfer
or dismissal etc.) ; change in ideas and working style
• Attitudinal Change
Management Structure
• Organization Designs
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Motivating Change
•Creating a readiness for change among Cummins Worli Model of
employees
•Overcoming resistance to change Change Management

Creating a shared vision

•Enriching commitment
•Describing a desired future state

Developing political support for the needed

changes Effective Change
•Assessing change-agent power
•Identify & Influencing stakeholders
Management
Managing transition from the current state
to the desired future state
•Activity Planning
•Commitment Planning
•Management Structure

Sustaining momentum for Change

•Providing resources for change
•Building a support system for change agent
•Developing new competencies & skills
•Reinforcing new behaviors 8
 People Culture

Task Technology

Design Strategy

System Model of Change 9

 System Model of Change
• The People Variable: Individuals working
with the organization (their personality,
attitudes, perceptions , attributes etc. )

• The Culture Variable: Reflection of shared

beliefs, values, expectations and norm of
organizational members.

• The Task Variable: Nature of the work

(Simple/complex/ novel/repetitive etc.)
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 System Model of Change
• The Technology Variable: Problem solving
methods and techniques used and the application of
knowledge to the various organizational process.

• The Design Variable: Organizational Design pattern

• The Strategy Variable: Organization’s planning &

decision making process with specific reference to the
actives undertaken to identify organizational goals
and , prepare specific plans to acquire, allocate , and
use resources in order to accomplish those goals.
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 Formula for change
DxVxF>R

D Dissatisfaction with how things are now

V Vision of what is possible
F First, concrete steps that can be taken towards the vision.
R Resistance for Change
If the product of these three factors is greater than R , then
change is possible. Because of the multiplication of D, V and F, if
any one is absent or low, then the product will be low and
therefore not capable of overcoming the resistance.
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 Kurt Lewin Change
Management Model

Process of Planned Change

Kurt Lewin

Unfreezing Moving Refreezing

• Provide rationale • Provide information • Implement new

for change that suspects evaluation systems
• Create minor proposed changes • Implement new
levels of • Bring about actual hiring and promotion
guilt/anxiety about shifts in behavior systems
not changing
• Create sense of
psychological
safety concerning
change
Communication during Unfreezing
Stage

1. Readying the organization for change

2. Challenging the status quo
3. Providing a rationale
4. Focusing on communication principles

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Communication during Changing Stage

1. Dealing with uncertainty

2. Focusing on specifics
3. Reporting the progress

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Communication during Refreezing Stage

1. Building understanding
2. Understanding personal implication for
change

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 Managerial Implications
1. Communication must come from top
2. Devise a communication system
3. Monitor & evaluate system
4. Be open & honest all the times
5. Combine written & face to face communication
6. Be relevant

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 Resistance to Change
Effort to block new
ways of doing things

Individual
Resistance

Group
Resistance
Organizational
Resistance
 Individual Resistance

•Economic Factors
•Habits
•Insecurity
•Lack of communication
•Extend of Change
•Psychological Factors
•Social Factors
 Group Resistance
•Most organizational changes have
impact on formal groups in the
organization the main reason why the
groups resists change is that they fear
that their cohesiveness or existence is
threatened by it.
 Organizational Resistance
The major reason for organizational
resistance are:-
•Threat to Power
•Group Inertia
•Organizational Structure
•Threat to Specialization
•Resource Constants
•Sunk Costs
 Resistance to Change
• Individual • Organization
Habit Structural Inertia
Security Limited Focus of
Economic Factors Change
Fear of Unknown Group Inertia
Social Factor Threat to Expertise

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 How to Overcome Resistance to
Change?
 Educating Employees
 Employee Involvement
 Facilitation
 Negotiation
 Manipulation & Co-optation
 Coercion

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 Organizational Diagnosis for
Change
• The starting point of a planned organizational
change is an accurate diagnosis of the
organizational problem & functioning. Organization
diagnosis involves following four basic steps-
• Recognition & interpretation of the organizational
problem & then asses the need for change.
• Determine the organization’s readiness & capability
for change.
• Identify managerial & employees resources and
motivations for change.
• Determine the new or change goals and change
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strategy.
 Steps in Organization Diagnosis
for Change

 Managing Planned Changes

 Changing People Behaviour
 Changing Task & Technology
 Changing Organisation Culture
 Changing Organisation Design

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Managing Planned Changes

CHANGES

FIRST ORDER CHANGE SECOND ORDER CHANGE

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 First Order Change
• when the new state of thing have the same basic nature as
the old state of thing, except for some moderate
adjustments to the existing structure of the
organization, the change is known as incremental or first
order change.
• In this type of change only minor adjustments are made
to few processes in the organization; major changes are not
made.
• First order changes are easily reversible.
• The best example of first order change can be seen in
Toyota and other Japanese companies. They adopted this
type of change to improve their production process and
organizational efficiency.
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• Transactional Leader
 Second Order change
• When the new state of thing have a completely different
nature from the old state of things it is known as
fundamental or, quantum or second order change. This
change is initiated when the organization needs to be
restructured and the fundamental nature of the
organization is being changed.
• The restructured organization differs completely from the
old fundamental structure of the organization. Second
order change is revolutionary in nature and involves a
major reinvention of the organization.
• Second order change is generally irreversible and it is
impossible to return back to the previous state once the
change process is complete.
• Transformational Leader 28
 Changing People Behavior

METHODS

SURVEY PROCESS
TEAM BUILDING
FEEDBACK CONSULTATION

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• Survey Feedback: Process of systematically collect
data about the system, feeding back the data for the
individuals & groups at all levels of the organization.
• Process Consultation : An approach for intervening in
an ongoing system. A skilled third party
(consultant)work with individual/groups to help them
to learn about human & social processes.
• Team Building :This intervention is a set of
activities, which are designed to enhance the
effective operation of system teams. They relate to
task issues, such as the way things are done, the needed
skills to accomplish tasks, the resource allocations
necessary for task accomplishments; or the nature and
quality of the relationships between the team members
or between team members and the leader. 30
Changing Task & Technology

METHODS

JOB DESIGN SOCIO-TECH SYSTEM QUALITY CIRCLES

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 Changing Task & Technology
• Job Redesign: As an approach to change, a job design involves
a deliberate, planned restructuring of the way work is performed
so as to bring about increased employees motivation,
involvement and efficiency, this all is done in order to improve
job performance.
• Socio-Technical System (STS): STS simultaneously analyze
and focus on the technical and social aspect of the organization
to optimize their relationship and thus increase organizational
effectiveness. Establishing compatibility between socio and
techno factor.
• Quality Circles: Quality circles consist of work group with
some volunteers from the same work area who regularly
meet to monitor and solve job related quality or production
problems. Quality circles are being used to improve working
conditions, increase the level of employee involvement and
commitment and encourage employee self-development.
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Changing Organization Design

METHODS

COLLATERAL MATRIX NETWORK

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 Changing Organizational Design

Collateral Organization
• A collateral organization is a parallel, co-existing
organization that can be used to supplement an existing
formal organization.
• The collateral organization utilizes teams of people
outside the normal formal channels of communication
like ways of working together, with identified authority
in making decisions and solving difficult problems.
• All this collateral functioning is done with the existing
people (or employees) in the formal organization i.e. , it
co-exists with it.
• Open and free flow of communication between mangers
and employees is one of the main feature of collator
organization.
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 Changing Organization Culture
• Trying to bring about a change in the
organizational culture is a very challenging task.
Perquisites for this are-
Take advantage of opportunities that
suggest organizational change.
While going for organizational changes,
managers and employees must combine
caution with optimism.
While administering change, try to retain
the core cultural values that have served
well.
Adopt changing socialization processes to
bring about effective cultural changes
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Organization Development

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 Organization Development (OD)
A planned, organization-wide,
continuous process designed to
improve communication, problem
solving, and learning through the
application of behavioral science
knowledge
• Planned Change
• Long Range Change
• Problem Solving
• Team Building
• Feedback
• Organizational Development is a systematic process for
applying behavioral science principles and practices in
organizations to increase individual and organizational
effectiveness.

• Beckhard “ Organization Development is an effort,

planned, organization-wide, and managed from the
top, to increase organization effectiveness and health
through planned interventions in the organization's
processes, using behavioral- science knowledge."
• Three components- Diagnosis, Intervention, and
Program Management – are critical to all OD
programs. 38
Basic Organization Development Model
Diagnosis of
Situation

Introduction of
Feedback
interventions

Progress
Monitoring
 OD Interventions
• OD interventions are set of structured activities
in which selected organizational units (target
groups or individuals) engage in a task or a
sequence of tasks with the goals of
organizational improvement and individual
development.
• a set of sequenced, planned actions or events
intended to help an organization to increase its
effectiveness.
• purposely disrupt the status quo; they are
deliberate attempts to change an organization or
sub-unit toward a different and more effective
state.
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• Every OD program is an overall game
plan or intervention strategy .
• This plan integrates the problem or
opportunity to be addressed, the
desired outcomes of the program, and
the sequencing and timing of the
various interventions.
• Intervention strategies are based on
diagnosis and the goals desired by the
client system.
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• This overall intervention strategy is the road
map for the change program.
• The key questions are: What are we trying to
accomplish? What activities/interventions will
help us get there? What is the project timing
and sequencing of the interventions? What have
we learned from the diagnosis about readiness
to change, barriers and obstacles, key
stakeholders, and sources of energy and
leadership?

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 Types of OD Interventions
• Systemic/System Interventions

• People Interventions

• Process Interventions

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 System Interventions
• Systemic interventions are those where a series
of changes are being made to enhance the
effectiveness of the systems followed at the
organization. This is at the topological level .
Eg: Compensation & Benefits System:-
• Understanding the market pay practices and
reward mechanisms
• Knowing the various norms of managing the base
pay, variable pay etc.
This is through a careful study and analysis
resulting in action points to implement a robust C
& B System.
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 People Intervention
• People interventions are meant to increase
people efficacy for better productivity.

• It is mainly from individual and team perspective,

using measures to benchmark individual
performances and identifying developmental
requirements are individual level interventions.

• The team building activities are viewed as

team/unit level interventions.

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 Process Interventions
• Process interventions are meant for the efficiency
of the process by bringing in necessary
improvements from the quality, cost and time
perspectives.
• Example: Redefining a recruitment process to
ensure the quality candidates are taken in and
legitimacy through background verification process .

The interventions are meant to bring efficiency and

effectiveness in the system, process and people in an
organization resulting in higher productivity and
employee engagement.
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 Major "Families" of OD Interventions
• Diagnostic Activities
• Team-Building Activities
• Intergroup Activities
• Survey Feedback Activities
• Education and Training Activities
• Techno structural or Structural Activities
• Process Consultation Activities
• Grid Organization Development Activities
• Third-Party Peacemaking Activities
• Life and Career-Planning Activities
• Planning and Goal-Setting Activities
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• Organizational Transformation Activities
 Change Management and OD
• OD is basically the application of tools,
methods, frameworks, technologies and
processes to make the entire organization
more productive, innovative and
profitable.
• OD is an ongoing, systematic process of
implementing positive and effective
organizational changes.
• OD is a tool for change management.
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The End

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