Organizational Change

Change

Change is constant Change is rapid-fire causing uncertainty

Political Technical Economic Sociological Cultural

Successful organizations manage change rather then being managed by it

Organizational Culture Defined

Commonly held and subscribed set of values, goals, expectations, processes, and rules that govern the operation of and relationships within an enterprise Reflects

Exists within the broader area of societal culture Driven by internal and external forces

What is valued Dominant leadership styles Language Symbols Procedures Routines

Market Technology Political Process

Organizational Change
Organizational change is defined as the adoption of a new idea or behavior by an organization.

Descriptions of Culture
Handy, C. (1993) Understanding Organizations, London, Penguin, p. 180.

differing atmospheres. different ways of doing things. differing levels of energy.

differing levels of individual freedom.

different kinds of personality.

Descriptions of Culture

Differing cultures, differing norms values beliefs about

authority control rewards, incentives, jobs rules, expenses obedience initiative hours of work dress

Organisational Culture & Change

Organisational life is not as neat, tidy or predictable as formal elements of organisation such as structure, strategy & technology may imply.
The culture and politics of many organisations constrain the degree of change and transformation in which they can successfully engage, even though such change may be highly desirable for meeting the challenges and demands of the wider environment.

Why change?

To implement Total Quality Management

To integrate changes in operational systems and procedures

To implement continuous improvement processes

To implement strategic planning To introduce new marketing plans To introduce new safety management systems To implement productivity improvement systems

To implement new performance review systems To introduce new incentive schemes and award systems To establish quality circles To respond to new competitors, company mergers, or unionization

Issues surrounding the need for change

Evaluating the levels and degrees of change required

Examining the sources of demand for change and determining their power Examining the company culture Evaluating the amount of choice involved

Forces for Change

External forces in the organizations general and task environments that force the organization to alter the way in which it competes. Internal forces inside the organization that cause it to change its structure and strategy; some internal forces are responses to external pressures.

Some Determining Factors of Change

PLANNED UNPLANNED

INTERNAL

Internal Planned Change External Planned Change

Internal Unplanned Change

External Unplanned Change

EXTERNAL

Planned Internal Change

A great deal of organizational change comes from The strategic decision to alter the way one does business.
Three examples of planned internal Organizational Change are:

Change in Products or Services. Changes in Administration System Changes in Organizational Size Structures

&

Planned External Changes

In addition to planning changes in the ways organizations are run, it is often possible to plan which variables originating outside the org. will be incorporated into it. Example of planned external changes are: Introduction of New technologies Introduction of new product lines (diversification)

Unplanned External Change

One of the greatest challenges faced by an organization is its ability to respond to changes from outside, something over which it has little control or no control.

Two of the most unplanned external factors are : Government Regulation Economic Competition in the Global Arena

Unplanned Internal Change

Such as:

Changing Employee Demographics

Performance Gaps

Nature of Change

Evolutionary Revolutionary Proactive Vs Reactive

States of Change

Future State Current State

Delta State

Levels of Change
(High)

Group Behaviour Individual Behaviour Attitude

Difficulty Involved

(Low)

Knowledge
(Short) Time Involved (Long)

Participative Change Cycle

Group Behaviour Individual Behaviour
4

Attitude
2

Knowledge

Directive Change Cycle

Group Behaviour Individual Behaviour
4

Attitude
2

Knowledge

Managing Change in Organizations

Steps in the Change Process (Lewin Model)

Unfreezing Individuals must be shown why the change is necessary. Implementing change The change itself is implemented Refreezing Involves reinforcing and supporting the change so that it becomes a permanent part of the system.

Initiation

Motivation

Steps in the Change Process

A Comprehensive Approach to Change

Diagnosis

Information Collection

Deliberation

Action Proposal

Implementation

Stabilisation

Resistance to Change

Individual Resistance

Organisational Resistance

Individual Resistance to Change

Economic Reasons

Obsolescence of Skills

Personal Reasons

Human Characteristic

Habit

Security

Fear of Unknown

Selective Information Processing

Ego Defensiveness

Status-Quo

Fear of Unknown

Social Reasons

Peer Pressure

Organisational Resistance to Change

Structural Inertia

Limited Focus of Change

Group Inertia

Threat to Expertise

Threat to Power and Influence

Threat of Resource Allocation

Resistance due to Sunk Capital

Education and Communication Participation and Involvement

Overcoming Resistance to Change in Organizations

Assistance and Support

Incentives Negotiation Manipulation and Co-optation Coercion

Change Management : Skill Requirement

Political

Business

Analytical

Skills
System People

Rational- Empirical

Normative-Reductive

Change Management Strategies

Power- Coercive

Environmental-Adaptive

1.Empirical-rational-People are rational and

will follow their self-interest once it is revealed to them. Change is based on the communication of information and the proffering of incentives.

2.Normative- deductive-People are social beings and will adhere to cultural norms and values. Change is based on redefining and reinterpreting existing norms and values, and developing commitments to new ones.

3.Power- coercive-People are basically compliant

and will generally do what they are told or can be made to do. Change is based on the exercise of authority and the imposition of sanctions.

4. Environmental-adaptive-People oppose loss and

disruption but they adapt readily to new circumstances. Change is based on building a new organization and gradually transferring people from the old one to the new one

Factors in selecting a change strategy

Degree of Resistance- Strong resistance argues for a coupling of Power-Coercive and EnvironmentalAdaptive strategies. Weak resistance or concurrence argues for a combination of Empirical-Rational and Normative-Reductive strategies.
Target Population- Large populations argue for a mix of all four strategies, something for everyone so to speak. The Stakes- High stakes argue for a mix of all four strategies. When the stakes are high, nothing can be left to chance.

The Time Frame- Short time frames argue for a PowerCoercive strategy. Longer time frames argue for a mix of Empirical-Rational, Normative-Reductive, and Environmental-Adaptive strategies.
Expertise- Having available adequate expertise at making change argues for some mix of the strategies outlined above. Not having it available argues for reliance on the power-coercive strategy. Dependency- This is a classic double-edged sword. If the organization is dependent on its people, management's ability to command or demand is limited. Conversely, if people are dependent upon the organization, their ability to oppose or resist is limited.

One more time: how to manage change?

The first thing to do is jump in. You cant do anything about it from the outside. A clear sense of mission or purpose is essential. Build a team. Maintain a flat organizational team structure and rely on minimal and informal reporting requirements. Pick people with relevant skills and high energy levels. Youll need both. Toss out the rulebook. Change, by definition, calls for a configured response, not adherence to prefigured routines.

(contd.)

Shift to an action-feedback model. Plan and act in short intervals. Do your analysis on the fly. No lengthy upfront studies, please. Remember the hare and the tortoise. Set flexible priorities. You must have the ability to drop what youre doing and tend to something more important. Treat everything as a temporary measure. Dont lock in until the last minute, and then insist on the right to change your mind. Ask for volunteers. Youll be surprised at who shows up. Youll be pleasantly surprised by what they can do.

(contd.)

Find a good straw boss or team leader and stay out of his or her way. Give the team members whatever they ask for except authority. Theyll generally ask only for what they really need in the way of resources. If they start asking for authority, thats a signal theyre headed toward some kind of power-based confrontation and that spells trouble. Nip it in the bud! Concentrate dispersed knowledge. Start and maintain an issues logbook. Let anyone go anywhere and talk to anyone about anything. Keep the communications barriers low, widely spaced, and easily hurdled. Initially, if things look chaotic, relax they are.

Models of Organisational Change

Individualistic Model Role-Oriented Model Group-Oriented Model Organisation-Oriented Model Equation Model

Lewins Three step Model Satellite Model ACHIEVE Model Johari Window Model Managerial Grid

1. Individualistic Model

Acc. to this model of change, the individual is the prime force in organisational change.

Individuals can promote or resist change.

If individuals get motivated, change is easy.

Adoption Diffusion Model- Individuals

change when they learn new and more desirable ways of doing things.

Feedback Model- Individuals change

when they get non-threatening feedback.

Motivational Model- Individuals change

when their motives change

2. Role Oriented Model

Changing organisational roles can bring about organisational change. If organisational roles can be modified, these will increase individuals involvement and organisational effectiveness. Organisational roles are analyzed for role efficacy (Potential effectiveness) in the terms of 10 dimensions.

Centrality Vs Peripherality Confrontation Vs Avoidance Integration VS Distance

Growth Vs Stagnation

Proactivity Vs Reactivity

Influence Vs Powerlessness

Creativity Vs Routinism

Superordination Vs Deprivation Help Vs Hostility

Linkage Vs Isolation

3. Group- Oriented Model

Organisation DevelopmentEffective organisational change would require a change in then basic values of the organisation, strong teams , and involvement of organisational members in different stages of planning.

Process Consultation- Help given to a client group in understanding and developing a methodology of working in general which affect decision making. Steps

Join Diagnosis of process with client Helping the client learning diagnostic skills Active involvement of client in searching for a solution.

Work Redesigning

focuses on redistribution of power of decision making in work-related matters to the group which is responsible for results. Role of supervisor changes to plan boundary management and educational roles.

Phases of Redesigning

Hostility Reluctance Guarded commitment and indifference Inter-group dynamics Positive Interest Isolation of negative elements Networking

4. Organisation-Oriented Model

The emphasis is on developing a new structure of the organisation in response to the changing environment or the changing priorities of the organisation, and on designing relevant systems. The changes introduced demand new ways of working, and individuals respond to such demands. E.g. MBO is an example of structural change.

5. Lewins Three step model

Unfreeze Change

Refreeze

6. Equation Model of Org. Behaviour and Performance

Knowledge x Skill = Ability Valence x Expectancy = Motivation Attitude x Motivation = Human Performance

Ability x Motivation = Human Performance

Attitude x Situation = Motivation Ability x Motivation = Human Performance Human Performance x Resources = Organisational Performance

7. Satellite Model of Org. Performance

Performance

Structure

Knowledge

Integration
Human Process Non-Human Resources

Strategic Positioning

8. ACHIEVE Model of Performance

A bility C larity H elp I ncentive E valuation V alidity E nvironment

9. Joharis Window Model

Less Feedback

More

Less Exposure More

Arena

Blind Spot

Known by others

Facade

Unknown

Unknown by others

Known by Self

Unknown by Self

10. Managerial Grid/9:9 Model

9

High Concern for People

1,9 Country Club

5,5 Compromiser 1,1 Deserter

9,9 Executive

Low
1

9,1 Autocrat
Concern for Production High
9

Low