Chapter 12: Managing Change

and Innovation
Lecture 8

Dr. Sally El Feky

Learning Objectives
The Change Process
• The two views of the change process
• Contrast the calm waters and white-water rapids
metaphors of change.
• Explain Lewin’s three-step model of the change
process.
Managing Organizational Change
• Define organizational change.
• Explain how managers might change structure,
technology, and people.

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Learning Objectives
Managing Resistance to Change
• Explain why people resist change.
• Describe the technique for reducing resistance to
change.
Contemporary Issues In Managing Change
• Explain why changing organizational culture is
so difficult and how managers can do it.
• Describe employee stress and how managers can
help employees deal with stress.
• Discuss what it takes to make change happen
successfully.

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Learning Objectives
Stimulating Innovation
• Explain how creativity and innovation
differ from one another.
• Describe the structural, cultural, and human
resource variables that are necessary for
innovation.

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The change
Process
The psychology of change

￮ Change is a fact of life..

￮ Our personal lives are a series of endings and new beginnings
￮ Relationships start and end, children are born, people die, we move
houses, and change jobs
￮ In our organizations too, change is on-going

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What is change?
Organizational Change
￮ Any alterations in the people, structure, or technology of an
organization

￮ Instead of trying to eliminate change, managers must realize that

change is always present and that they should seek ways to manage
change successfully

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Characteristics of Change

￮Is constant yet varies in degree and direction

￮Produces uncertainty yet is not completely unpredictable
￮Creates both threats and opportunities

Managing change is an integral part

of every manager’s job.

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 External and Internal Forces for
Change
External
Internal
• Changing consumer needs and wants
example fast food • New organizational strategy
• New governmental laws • Change in composition of workforce
• Changing technology • New equipment
• Example using robots , AI • Changing employee attitudes (how do we
• Economic changes know this???)
• Example instead of importing now
exporting

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Why to change?
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 Views of Change
Calm Water
Large ship
• Captain and the crew know CHANGE
exactly where they are
White- Water Rapid
going Image
• They made the trip many • Organization is seen as
times before a small raft navigating
• Change comes in the form raging river .
of occasional • People have never
disruption/storm to the worked before together
normal flow • They are unfamiliar with
• Characterizes the process the river
of change as being like a • They are unsure of their
ship crossing a calm sea destination
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• They travel at night
Change Process Viewpoints

Lewin’s description of the change process as a break in the organization’s

equilibrium state

￮ Unfreezing the status quo ( driving force)

￮ Changing to a new state
￮ Refreezing to make the change permanent

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 TWO VIEWS OF THE CHANGE
PROCESS
1-CALM WATER
￮ 1-Unfreezing the equilibrium is the first step. Unfreezing the equilibrium
can be accomplished in one of three ways.
￮ a. Increasing driving forces, which are forces that direct behavior away
from the status quo.
￮ b. Decreasing restraining forces, which are forces that hinder
movement from the existing equilibrium.
c. Combining the two approaches.

2. The next step is to implement the change itself.

￮ 3. The final step is to refreeze the situation.

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12-13 Copyright © 2011 Pearson Education
Three-Step Change Process

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2-White-water Rapid

White-Water Rapids Metaphor ‘symbol”

The lack of environmental stability and
predictability requires that managers and
organizations continually adapt (manage
change actively) to survive.

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Types of organization change

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Organizational Change and Change Agents

Organizational Change
Any alterations in the people, structure, or technology
of an organization.
Change Agents
Persons who act as catalysts and assume the
responsibility for managing the change process

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Organizational Change and Change Agents

Types of Change Agents

1. Managers: internal entrepreneurs
2. Nonmanagers: change specialists (HR department)
3. Outside consultants: change implementation experts

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 Exhibit 12–3 Three Types of Change

12-19 Copyright © 2011 Pearson Education

 Areas for Change in an Organization

A B C D E

ORGANIZATIONAL STRUCTURE TECHNOLOGY PEOPLE CULTURE

Merger and Re-ingineering, Automation, Quality and Customer-Driven

Acquisitions restructuring Computerization Charactersitics of
people
Vertical to Flat E-Commerce
hirerachy Attitude and
Behaviors
Types of Change

Structure

Changing an organization’s structural components

or its structural design.

- span of control, departmental responsibilities,

redesign (drop, merge add divisions
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Types of Change
Technology
Adopting new equipment, tools, or operating methods that
displace old skills and require new ones.
Example :drilling company updates its operation methods

 Automation: replacing certain tasks done by people

with machines. It is more efficient and effective
 Computerization; more supermarkets use scanning
that is linked to inventory , ERP payroll and self
service system
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Types of Change

People

Changing attitudes, expectations, perceptions,

and behaviors of the workforce.

I add: knowledge, skills, abilities ..etc

Example: For improving customer satisfaction

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Changing people: Organizational
development

Organizational Development (OD)

• Techniques or programs to change people and the
nature and quality of interpersonal work
relationships.

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OD Techniques

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Changing Culture

￮ Cultures are naturally resistant to change.

￮ Conditions that facilitate cultural change:
1. The occurrence of a dramatic crisis (loss of customers, financial
crisis)
2. Leadership changing hands
3. A young, flexible, and small organization
4. A weak organizational culture

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Strategies for managing cultural
change
• Set the tone through management behavior; top managers, particularly, need to be
positive role models.
• Create new stories, symbols, and rituals to replace those currently in use.
• Select, promote, and support employees who adopt the new values.
• Redesign socialization processes to align with the new values.
• To encourage acceptance of the new values, change the reward system.

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Strategies for managing cultural
change
• Replace unwritten norms with clearly specified expectations.
• Shake up current subcultures through job transfers, job rotation, and/or
terminations.
• Work to get consensus through employee participation and creating a
climate with a high level of trust.

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Why people resist
to change?
Why people resist to change
￮ Fear of the unknown
￮ The ambiguity and uncertainty that change introduces.
￮ The comfort of old habits.
￮ A concern over personal loss of status, money, authority,
friendships, and personal convenience.
￮ The perception that change is incompatible with the goals and
interest of the organization.

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Managerial Actions to Reduce Resistance to Change

￮ Education and communication

￮ Participation
￮ Facilitation and support
￮ Negotiation
￮ Manipulation and co-optation
￮ Selecting people who accept change
￮ Coercion

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Reducing resistance to change

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Handling employee stress
￮ Think of yourself during graduation project , then finding , then having
bad boss
￮ Stress represents the adverse reaction people have to excessive pressure
placed on them from extraordinary demands, constraints, or opportunities.
Functional Stress
• Stress that has a positive effect on performance.
• How Potential Stress Becomes Actual Stress
￮ When there is uncertainty over the outcome.
￮ When the outcome is important.

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Causes of stress

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Symptoms of Stress

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Reducing Stress
￮ Engage in proper employee selection
￮ Match employees’ KSA’s to jobs’ Tasks, Duties, and Responsibilities (TDR’s)
￮ Use realistic job interviews to reduce ambiguity
￮ Improve organizational communications
￮ Develop a performance planning program, provide clear goals
￮ Use job redesign, to reduces boredom and work overload
￮ Provide a counseling program, employee wants to talk to someone
￮ Offer time planning management assistance
￮ Sponsor wellness programs such as quit smoking , vaccination, yoga, gym ,
sports tournament

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Characteristics of Change-capable
Organizations
￮ Link the present and the future.
￮ Make learning a way of life.
￮ Actively support and encourage day-to-day improvements and changes.
￮ Ensure diverse teams.
￮ Encourage mavericks “unconventional people”.
￮ Shelter breakthroughs “ innovations”.
￮ Integrate technology.
￮ Build and deepen trust.

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Stimulating Innovation
Creativity
• The ability to combine ideas in a unique way or to make an
unusual association.
Innovation
• Turning the outcomes of the creative process into useful products,
services, or work methods.
Idea Champion
• Dynamic self-confident leaders who actively and enthusiastically
inspire support for new ideas, build support, overcome resistance,
and ensure that innovations are implemented.

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Can you be creative but
not innovative?

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Systems View of Innovation

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Creating the
“Right”
Environment
for innovation

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Barriers to Creativity in the Arab
Country
￮ Low commitment to the organization
￮ Lack of management support
￮ Lack of adequate organizational communication
￮ Lack of involvement
￮ Authoritative styles of management
￮ Risk aversion “dislike “,
￮ Time pressures
￮ Intolerance for developmental mistakes
￮ An obsession about enforcement of rules and policies that
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hinder creativity
Thank you

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