Ch 03 (organizational change)

Excel BooksR L Nandeshwar, Balakrishna Jayasimha

SECTION A : Change Management

Copyright © 2010, R L Nandeshwar, Balakrishna Jayasimha

Ch:3 ORGANIZATIONAL CHANGE33

3– 1 Change and Knowledge Management (2nd Edition)

Chapter

3ORGANIZATIONAL CHANGE






Introduction and Definition of Organization Change

“Change or die!” is the rallying cry among today’s Organizations

worldwide.

More and more organizations today face a dynamic and changing environment.

Human resource policies and practices have to change in order to attract and

keep this more diverse workforce. And many companies have to spend large

amounts of money on training to upgrade skills of employees.

In short organizational change is a constant necessity in today’s world which

brings us to the question, exactly what does ‘organizational change’ mean?

Organizational Change can be defined as, “a concerted, planned effort to

increase organizational effectiveness and health through changes in the

organization’s dynamics using behavioral science knowledge.”






The Basic Context for Organizational ChangeTo understand the context for an Organization wide change we need to answer three questions regarding organizational Change which are:

1. What Provokes “Organizational Change”?

Usually organizational change is provoked by some major outside driving force, e.g., substantial cuts in funding, address major new markets/clients, need for dramatic increases in productivity/services, etc.

2. Why is Organization-wide Change Difficult to Accomplish?

Many doubt there are effective means to accomplish major organizational change. In fact Organization-wide change often goes against the very values held dear by members in the organization.

3. How is Organization-wide Change Best Carried Out?

Successful change must involve top management, including the board and chief executive. Change is usually best carried out as a team-wide effort.






Cont….

The Nature of Organizational Change The rapidity of change taking place in the social, political and economic

environments is creating a marked impact on organizations as well as individuals.

Though the change has been coeval with human existence, the pace of change has varied in recent times, most of the development having taken place in the last hundred years. This is likely to accelerate in the new millennium.

Some of the notable changes that have been witnessed, in this decade are:

1. Globalization of markets

2. Technological Changes

3. Political realignments

4. Changing demographics

5. Changing customer preferences

6. Organizational restructuring






Cont….

The Principles of Organizational Change

1. Honesty

2. Aims

3. Participation

4. Recognition

5. Team working and Interpersonal relationship

6. Vision of the change

Dimensions of organizational change

Organizational change can seem like such a vague phenomena that it is helpful if you can think of change in terms of various dimensions as:

Organization-wide vs Subsystem Change

Transformational vs Incremental Change

Remedial vs Developmental Change

Unplanned vs Planned Change






Cont….

The Levels of Organizational Change

Perhaps the most difficult decision to make is at what “level” to start. There are

four levels of organizational change.

Level 1: Shaping and Anticipating the Future

Level 2: Defining Businesses/Core Competencies

Level 3: Reengineering (Structurally Changing)

Level 4: Incrementally Changing






Choice of levels

These levels have much of the same goals: increasing customer satisfaction, doing things right the first time, greater employee productivity, etc. Despite these similarities, they differ substantially in the methods they use to achieve these goals.

Goals

Goals also need to be SMART, that is

Specific - concrete action, step by step actions needed to make the goal succeed.

Measurable - observable results from the goal’s accomplishment.

Attainable - The goal is both possible and is done at the right time with sufficient attention and resources.

Realistic- The probability of success is good, given the resources and attention to it.






Types of Organizational Change

1. Happened Change

2. Reactive Change

3. Anticipatory Change

4. Planned Change

5. Incremental Change

6. Operational Change

7. Strategic Change

8. Directional Change

9. Fundamental Change

10. Total Change

11. Transformational Change

12. Revolutionary Change

13. Recreational Change






The Forces of Organizational ChangeOrganizations encounter many different forces for change. These forces come from external sources outside the organization and from internal sources. This section examines the forces that create the need for change. Awareness of these forces can help managers determine when they should consider implementing an organizational change.

External Forces

Demographic Characteristics

Technological Advancements

Market Changes

Social and Political Pressures

Internal Forces

Human Resource Problems

Managerial Behavior and Decisions






Cont….

Models of Organizational ChangeKurt Lewin was an American social psychologist. He has contributed to science group dynamics and action research, and he is regarded one of the founders of modern psychology. But Lewin is perhaps best known for developing Force Field Analysis and Force Field Diagrams.

Lewin’s view on Organizations

Change Model 1: Kurt Lewin’s and Friends Three step model

REFREEZE

FREEZE

UNFREEZE

Lewin’s Three stage model






Cont….

Change Model 2: Kurt Lewin’s Force Field Analysis

Force Field Diagram

Change Issue

Driving forces Restraining forces

weak

moderate

weak

strong force

Equ

ilib

riu

m

no change change






Cont….

Change Model 3: Systems Approach

Transformation

InputsOutputs

Productivity Efficiency

Productivity Activities

Men Materials Machine Methods Money

Systems Theory Approach






Cont….

Change Model 4: Seven Stage Model

Phase 1: Developing a need for change. This phase corresponds to Lewin’s unfreezing phase.

Phase 2: Establishing a change relationship. In this phase a client system in need of help and a change agent from outside the system establish a working relationship.

Phase 3: Clarifying or diagnosing the client system’s problem.

Phase 4: Examining alternative routes and goals; establishing goals and intentions of action.

Phase 5: Transforming intentions into actual change efforts. Phases 3, 4, and 5 correspond — Lewin’s moving phase.

Phase 6: Generalizing and stabilizing change. This phase corresponds to Lewin’s refreezing phase.

Phase 7: Achieving a terminal relationship, that is, terminating the client consultant –relationship.






Cont….

Change Model 5: ADKAR Model

Awareness – of why the change is needed.

Desire – to support and participate in the change.

Knowledge – of how to change.

Ability – to implement new skills and behaviour.

Reinforcement – to sustain the change.






Cont….

ADKAR

CHANGE

Knowledge

Rei

nfor

cem

ent

Aw

areness

Ability D

esir

e

ADKAR – A Model for Change Management






Change Model 6: Action Research

EstablishClient –

ConsultantRelationship

DisengageConsultant's

services

Diagnose theChange

Introduceintervention

Evaluate andstabilizechange

Gather data,Analyze data,

Decideinterventionobjectives

ImplementDesired

Incremental orQuantumChange

Determineeffectiveness

of change andrefreeze new

condition

Action Research Process






Managerial Options for Managing Change

Three broad approaches, which are popularly used in organizations to

create changes, are listed below. This classification aims to integrate the

findings on change management.

These approaches differ from each other in terms of the assumptions about

people and systems change, the specific strategies used for making the

change successful, and the kind of response they are more likely to

stimulate.

Top-down Approach

Laissez-faire Approach

Collaborative Approach






Cont….

Perspectives of Organizational Change

“Perspectives of Organizational Change” gives the individual an insight into

the basic principles that drive change.

They also gain an understanding of the factors that impact on the readiness

and ability of individual to change.

It shows the individual how to deal with the fear that may be generated in a

situation where change is just around the corner.






Cont….

ContingencyPerspective

PopulationEcology

Perspective

InstitutionalPerspective

ResourceDependencePerspective

PerspectivesOf

OrganizationalChange

Perspectives of Organizational Change






Perspective, focus and Issues

Perspective Focus Issues

Contingency perspective

Structure Whether the structure is compatible with external and internal environment of the organization.

Resource dependence perspective

Strategy What strategies should be implemented by the organization to:a) Increase control on the factors affecting due to

environmental changesb) To reduce dependence

Population ecology perspective

Ecological niche a) What is the organizational level of resistance?b) What is the sustainability of niche?c) What are the other niches and domains

dependable with the organizational capabilities?

Institutional Perspective

Norms, values and standards

a) What is the learning from other organizations?b) What kind of changes are to be adopted in order to

comply with the external environmental pressures?c) How can hiring professional help in acquiring the

knowledge for the organization?






Cont….

Understanding the Change ProcessThe following steps will help to understand change process:

Preparation Phase

Contact Stage

Awareness Stage

Acceptance Phase

Understanding Stage

Positive Perception Stage

Commitment Phase

Installation Stage

Adoption Stage

Institutionalization stage

Internalization stage






Cont….

The Eight step model to transform your organization as suggested by John

P. Kotter from “Leading Change: Why Transformation Efforts fail” is stated

below. The eight steps are:

1. Establish a Sense of Urgency

2. Obtain Management and Peer Backing

3. Create a Vision for Change

4. Communicate the vision

5. Empower Employees to Implement Change

6. Establish Short-term Goals

7. Encourage Additional Changes

8. Reinforce Changes Made as Permanent






John P. Kotter’s ‘Eight steps to successful Change’

1. Increase urgency

2. Build the guiding team

3. Get the vision right

4. Communicate for buy-in

5. Empower action

6. Create short-term wins

7. Don’t let up

8. Make change stick






Facilitating the ChangeThose involved with change search for a checklist to overcome the problems but there is no one best way to implement change; yet we can learn from the experiences of others. Jick suggests a tentative list of suggestions includes:

Analyze the organization and its need for change

Create a shared vision and common direction

Develop a non-threatening and preferably participative implementation process

Support a strong leader role

Line up political sponsorship

Craft an implementation plan

Develop enabling structures

Communicate, involve people and be honest

Reinforce and institutionalize change






Resistance to ChangeDefinition Resistance is an inevitable response to any major change. Individuals

naturally rush to defend the status quo if they feel their security or status are threatened.

Alvin Zander (1950), an early researcher on the subject, defined resistance to change as “behaviour which is intended to protect an individual from the effects of real or imagined change”.

Zaltman & Duncan (1977), define resistance as “any conduct that serves to maintain the status quo in the face of pressure to alter the status quo”.

The Nature of Resistance Active resistance include finding fault, ridiculing, appealing to fear, and

manipulating. Passive resistance symptoms include agreeing verbally but not following

through, feigning ignorance and withholding information.






Cont….

Levels of Resistance

Resistance to change in organization is found at three levels such as:

1. Individual Resistance

Habit

Security

Economic Factors

Fear of the Unknown

Selective Information Processing






Cont….

2. Organizational Resistance

Power and Conflict

Functional Orientation

Mechanistic Structure

Structural Inertia

Limited Focus of Change

Group Inertia

Threat to Expertise

Threat to Established Power Relationships

Threat to Established Resource Allocations






3. Group Resistance

Group Norms

Group Cohesiveness

Group Inertia

Groupthink and Escalation of Commitment






Cont….

Intervention Strategies for Organizational Change

Understanding Organizational Development (OD)

Organization development is an applied field of study and practice. A pair of OD

experts defined organization development as follows:

Organization development is concerned with helping managers plan change

in organizing and managing people that will develop requisite commitment,

coordination, and competence.

Its purpose is to enhance both the effectiveness of organizations and the

well-being of their members through planned interventions in the

organization’s human processes, structures, and systems, using knowledge

of behavioral science and its intervention methods.






Cont….

Characteristics of the Organizational Development

OD Involves Profound Change

OD is Value Loaded

OD is a Diagnosis/Prescription Cycle

OD is Process Oriented

The following briefly identifies the underlying values in most change

efforts.

1. Respect for people

2. Trust and support

3. Power equalization

4. Confrontation

5. Participation






Intergroup Development

A major area of concern in change is the dysfunctional conflict that exists

between groups. As a result, this has been a subject to which change efforts

have been directed.

Intergroup development seeks to change the attitudes, stereotypes, and

perceptions that groups have of each other.






Cont….

Types of Interventions

Various interventions for organization change can be classified into:

1. Structural Interventions

Structural Reorganization

New Reward Systems

Changing Organizational Culture

2. Task Technology Interventions

Appreciative Inquiry

Job Redesign

Socio-technical Systems

Quality of Work Life






3. People Focused Interventions

Sensitivity Training

Survey Feedback

Process Consultation

Team Building

Intergroup Development

Grid OD






Cont….

Developing Learning

Organizations

With theoretical foundation

largely provided by Argyris

(double loop leaning) and

Peter Senge (generative

learning) the characteristics of

learning organizations can be

listed as follows:

Characteristicsof Leading

Organizations

Culture ofFacilitating

Change

Presenceof

Tension

SystemsThinking

Characteristics of Learning Organizations






Cont….

Why Learning Organisations?

To cope with a changing environment and uncertainty.

To be more flexible and take advantage of opportunities.

To be more innovative.

To make the most of the skills and talents of staff.

In commercial businesses this need is driven by competition - how does it fit

other types of organisation, e.g., NGOs, public sector?






Cont….

How do Organizations learn?

Learning organizations foster an environment wherein people can “create

the results they truly desire,” and where they can learn to learn together for

the betterment of the whole.

Peter Senge is a leading writer in the area of learning organizations, whose

seminal works The Fifth Discipline: The Art and Practice of the Learning

Organization, and the fifth Discipline Field book.






Cont….

Systems Thinking

Team Learning Personal Mastery

Building SharedVisions

Mental Models

Disciplines of Learning Organizations






The Golden Rules for learning organizations

As an organization which learns and wants its people to learn, it must try to

follow certain concepts in learning techniques and mould itself to accommodate

for a number of specific attributes.

1. Thrive on Change

2. Encourage Experimentation

3. Communicate Success and Failure

4. Facilitate Learning from the Surrounding Environment

5. Facilitate Learning from Employees

6. Reward Learning

7. A Proper Selfishness

8. A Sense of Caring

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Ch 03 (organizational change)

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