10.1 Managing change Flashcards
What should managers and leaders constantly monitor for pressures to change
Internal and external environment
What should managers and leaders also consider when considering pressures for change
Employee resistance to change, known as forces resisting change
What is Lewin’s force field analysis
Supports managers and leaders in comparing pressures or forces for change against the forces resisting this change
What is chain management
The process that ensures a business responds to the environment in which it operates
What is radical change
(Step one)
- dramatic or radical change in one fell swoop
- often involves significant alteration in the business
- gets it over quickly / decisively
- may require some coercion to overcome resistance
What is incremental change
- usually involves little resistance
- many small changes which take place as a business develops and responds to subtle changes in the external environment
- arises as strategy develops
What is disruptive change
- A form of step change arising from changes in the external environment
- impacts the market as a whole, challenging the established “business model” (how products / services are sold)
- rapid improvements in technology are the main driver of this change since technological innovation provides new ways of delivering goods and services as well as reducing barriers to entry
Industries that suffered disruptive change due to technology change
- media streaming (Spotify, Netflix, YouTube)
- grocery retailing (Morrisons, Asda, Amazon)
- travel & accommodation ( Airbnb, Trivago)
- fashion retail (Asos, Boohoo, Missguided)
- consumer file storage (Dropbox, iCloud, OneDrive)
Internal causes of change
- new leadership
- change in strategic direction & corporate objectives
- significant investment decisions
- changes to scope of business activities
- adjusting the organisational structure (e.g delayering)
External causes of change
- competition (e.g new products, takeovers)
- political & legal changes (e.g deregulation or takeovers)
- changes in economic environment (post Brexit for UK firms)
- longer-term changes in society (e.g lifestyles, demographics)
- technological change (e.g rapid growth or mobile device usage)
The value of change
- whilst change is often viewed with concern by those affected, it is an essential part of the business life
- the external environment is constantly changing, which makes change a constant too
Benefits of change
- helps sustain a competitive advantage
- aligns business strategy with evolving nature of customer needs & wants
- can take advantage of developing technologies
- stakeholders gain from improved productivity and work environment
- enables a business to improve the effectiveness of its communication and decision-making
- being perceived as a business that leads change rather than follows it may bring market benefits
What are the 4 Kotter and Schlesinger’s reasons for resisting change
- self-interest
- different assessment of the situation
- low tolerance for change & inertia
- misinformation & misunderstanding
What are the 6 Kotter and Schlesinger’s overcoming barriers to change
- education & communication
- participation & involvement
- facilitation & support
- manipulation & co-option
- negotiation & bargaining
- explicit & implicit coercion
Why is self-interest a reason for resisting change
- powerful motivator
- arises from perceived threat to job security, status and financial position
- understandable -why would you want to lose something you believe to be valuable
- individuals often place their own interests ahead of those of their organisation, particularly if they don’t feel a strong loyalty to it