Change Flashcards
What is change
Change is an ongoing process and businesses cannot avoid having to deal with its consequences. Change in some businesses can be gradual, with small, incremental changes made to the way they operate year after year.
Incremental
This is a series of small or regular changes - these changes are easier to manage.
What is a shock change
A rapid change
Internal causes of change
Introduction of new technology
Change in management structure or leadership style
Changes in size
External causes
developments in technology
market changes (competitors, new markets or globalisation)
changes in consumer tastes
new legislation
changes in the workforce
changes in the economy.
Planned change
Planned change is created internally and is structured and timetabled. Clear objectives for the change are established, timetables created and resources applied to creating the change.
Unplanned change
Unplanned change occurs in response to a shock to the business and is often unstructured and under-resourced.
Contingency plan
should help a business to minimise the effects of an unplanned change.
A pre-defined set of actions to take if a planned event or project faces unexpected disruptions or failures
Exogenous
External
The effects of change on a business
Shorter product lifecycles
Dimished brand loyalty
New product development
Changing production methods
Retraining workforce
Benefits of managing change effectively
assess and understand the need for and the impact of change
allocate resources, such as capital, and staffing the business to support the implementation of change
manage and control the costs incurred with change
reduce the time needed to implement change
plan and implement an effective strategy to communicate change with all stakeholders, in particular the staff, which will help the business support staff through the change
maintain or improve the performance of the business, e.g. improve productivity for manufacturing businesses or improve service for those businesses in the tertiary sector.
There is a range of both quantitative and qualitative indicators that can be examined
delivery times
production defects
customer satisfaction surveys
market share
sales turnover
profitability
J storeys four approaches
A total imposed package - This would be a whole package of changes and would simply be presented to the employees. The senior management team would work out the restructuring they feel is required and then impose this on the business and its workers. The advantage of this is that it will create rapid change and ensure that the vision for the direction of the business is clear, but if the organisational culture does not match this approach then there may be significant resistance to change.
Imposed piecemeal initiatives - This is a more gradual approach. Change and restructuring of a business is still imposed by senior management, but in stages rather than all at once. This may give employees more time to adapt and may help alleviate resistance, but it will still need to be accompanied by changes in the organisational culture to encourage change. To help the introduction of the initiatives, the firm may offer incentive payments or perhaps other non-financial rewards for the successful implementation of the changes.
Negotiated total packages
Negotiated piecemeal packages
To prepare for change and to be in a position to react effectively to change, managers need to put in place a number of key strategies. These are:
Employee preparation
Increased research and development
Additional capital investment
There are four main reason to resistance to change
Self-interest – This arises from the perceived threat to job security or maybe suppliers fearing for future orders. Therefore, stakeholders tend to put themselves before the needs of the business.
Misinformation and misunderstanding – Stakeholders may not understand why change is needed because they have been misinformed about the strategy of the business. Some stakeholders may think that things are better the way they are.
Different assessment of the situation – This is where there is disagreement about what change is needed. Stakeholders have different views about what is needed for the best for the business.
Low tolerance and inertia – Many people suffer from reluctance to change. Many people need security, predictability and stability in their work.
Lewins three stages of implementing and maintaining change
Unfreezing
Change or transition
Re freezing
Unfreezing
This involves creating a motivation for change and creating a realisation amongst employees that change is necessary. They therefore have to ‘unfreeze’ from current approaches to work and be prepared to adapt to a new method of working. Employees have to be shown that change is necessary and then managers need to create a situation in which employees desire the change.
Change or transition
Lewin described the period of transition as a potentially difficult time as workers are now moving toward a new way of doing things. They are learning about the changes and need to be given time to understand and adapt to these changes. Support from management and supervisors is important in making the transition period work. Support can come in the form of training, education, and learning from and not being criticised for mistakes. Allowing workers to develop their own solutions and maintaining clear communication of the objectives and benefits of the change are also important in maintaining the transition.
Re freezing
This final stage in the change process is about establishing stability once the changes have been made. Workers have now accepted the change, and the new methods of working have become the new norm. Workers are settled in new structures and are comfortable with their routines. This refreezing clearly implies workers must not be forced into continual change, but allowed time to adapt. New methods need to become completely ingrained before further change occurs, otherwise any gains may be lost.
