Chapter 5 - Organisational Change Flashcards
Strategy implementation
Takes place via organisational change processes, and can be understood as rational/ planned or processual.
Importance of Change Management
Economic crises in 190s, recessions in 80s and 90s, have shown constant change. Organisations that haven’t managed change effectively haven’t survived. e.g. Nokia, Blackberry. Hence, managing change effectively is crucial to survival and success of organisations.
External Drivers of Change
Political factors e.g. govt regulations, new laws enforced
Economic factors e.g. inflation, GFC, economic systems
Socio cultural factors e.g. changes in consumer tastes, new products, social attitudes
Technological changes eg. Digital world
Internal Drivers of Change
Performance problems e.g. dropping profits
Problems with internal processes e.g. slow decision making
Managerial philosophy/ styles or change in leadership e.g. new management
Changes can include
Strategy/structure e.g. introduction of teams Size e.g. downsizing/ growth Products/services Technologies e.g new systems/ software Human capital - more outsourcing Location of production Mergers and acquisitions Culture (organisational) Brand
Nature of organisational change
Evolutionary (small, slow)
Revolutionary (big, fast)
Planned
Unplanned
Evolutionary Change
Stays relatively stable
Change individual parts/ departments
Make the most of existing structure and management
Incrementally change existing production technology
Improve existing products
Revolutionary Change
Seek new equilibrium Transform entire organisation Create new structure and management Adopt radically new production technology Introduce path breaking new products
Planned change
Systemic e.g. new technology, privatisation, deregulation, entry into new market
Adaptive e.g. updating computer system, modifications to existing plans
Unplanned change
Chaotic e.g. terrorist attack, hostile take over
Transitory: strike, sudden change in commodity prices, loss of key personnel
Strategic change
Shift in vision/direction Operational change involves anything affecting day to day operations. Strategy implementation necessarily involves change.
Understanding and mangin strategic change:
Planned approaches to strategy: strategy drives change. Strategy formulation comes first, followed by implementation
Emergent approaches to strategy: change is strategy. Strategy formulation is in large part strategy implementation.
Operational change
Change involving anything affect day-to-day operations
Planned Approaches to Change
Field Theory
Force Field Analysis
3 step change model
Organisational Development
Field theory
Kurt Lewis. To understand human behaviour, we must understand the forces influencing it. To explain social behaviour, it is necessary to represent structure of total situation and distribution of forces within it. Behaviour is a function of individual and environment/field. If we can understand the forces which influence behaviour, we can understand which forces should be intensified and which weakened to drive a desired change.
Force Field Analysis
In any organisation, status quo is a function of balance between two sets of force (stability vs. change). if we can map the forces for stability and change, we can influence balances of forces then we can bring about change. Some forces cause change, others promote stability.
3 Step Change Model
Unfreezing - Moving/ Changing - Freezing
Unfreezing
Reduction in forces that constrain change. Creates conditions for change. Breaking organisational members’ psychological attachment to status quo. Information with demonstrates that status quo is problematic. Prepare for change, identify problem, explain to employees.
Moving/Changing
Changes in attitudes and behaviours i.e. what change is needed, possible and how will change happen.
Importance of involving organisational members
being democratic and involving employees in decision, better understanding and more committed to change.
Freezing
once change is implemented, how can it be sustained? New attitudes and behaviours must be supported by systems and processes. Ensuring consistency of practices. Group norms transferred.
Organisational Development
Extends 3 step model. Combination of research, analysis, action aimed at changing organisation to improve their effectiveness.
Features of organisational development
Change agents
Empowering employees to act
Creating openness in communications
Facilitating ownership of the change process and its outcomes
The promotion of a culture of collaboration
The promotion of continuous learning
Step 1 of OD: Problem Identification
Someone (commonly senior manager) identifies need for change. Can be difficult to identify problems
Step 2 of OD: Consultation with an expert
An initial consultation between OD specialise and senior managers. An opportunity to explore expectations and assumptions.
Step 3 of OD: Data gathering and preliminary diagnosis
use interviews, participant observation, questionnaires, and organisation/ individual performance data
Step 4 of OD: Initial Feedback
Develop an analysis team which includes employees - this gives employees a degree of ownership of analysis and solution.
Step 5 of OD: Joint Diagnosis
Basis of action research, what is the problem and what can be done?
Step 6 of OD: Joint Action Planning
Based on joint analysis, both parties agree on further action
Step 7 of OD: Action
Moving an organisation from one state to another. Structures, procedures, technology, work, design etc.
Step 8 of OD: Data gathering after action
A process of evaluation, this allows the organisation and the OD specialist to feedback information as part of iterative process.
Common criticisms of planned approach
Model assumes a stable state
Methods only suitable for small scale change projects
Approach is top down and management driven
Processual Approach to Change
Should not and cannot be solidified
Cannot meaningfully understood as series of linear events
As a continous process
As a complex interplay between politics, context, and substance
Essential Elements of processual approach
Context, content, process and politics
Politics of Change
Compromises political activities of consultation, negotiation and conflict resistance.
External politics e.g. senior business leaders/ industry groups lobbying govt, govt press on organisational decision making
Internal politics e.g. negotiations between unions and management, employees and management or struggles between different managers.
Content/Substance of change Dimensions
Scale and scope of change
Defining characteristics of change
Timeframe of change
Perceived centrality of change
Managing Change
Messy and difficult to manage change. Organisational change is usually partly planned and processual.
Research and practice have identified culture and resistance as factors that can impede/facilitate change.
Culture
Centrality of values, norms, beliefs and assumptions but also myths, symbols, rituals etc.
Difficult to change organisational culture but some can facilitate this through honesty, open mindedness, cooperative cultures.
Cultural paradigms influence how willing and able managers are to implement change and often leads to strategic inertia.
Resistance to change
Perennial issues in management. Often seen as illegitimate/ even pathological. Questioned if can be an inevitable consequence of structured antagonism. Central to change management.
Common reasons for resistance
Desire not to lose something of value
A belief that change does not make sense for the organisation
Misunderstanding of change and its implications
Low tolerance/openness for change.
Dealing with resistance through
Education and communication Participation and involvement Facilitation and support Negotiation and agreement Manipulation and cooption Explicit and implicit coercion.
