Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.1

Managing Change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.2

Outcomes

• Identify the types of change and key drivers• Understand who and what are the resistors of

change and how resistance can be overcome• Explain and assess change processes

– management of organisational routines– political and symbolic processes– other change tactics

• Determine different styles of change management and their impact

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.3

Exhibit 14.1 Key elements in managing strategic change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.4

Strategic Change Management

“There is nothing more difficult to take in hand, more perilous to

conduct, or more uncertain in its success than to take the lead in

the introduction of a new order of things”

Machiavelli

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.5

Causes and Dynamics of Strategic Change

Causes (Tichy 1983)

• Environment

• Business Relationships

• Technology

• People

Dynamics (Kanter, Stein & Jick

1992)

• Environment

• Life cycle differences

• Political power changes in the organisation

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.6

Environment

Values Resources

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.7

Environment

Values Resources

STRATEGIC EFFECTIVENESS

Pressures for discontinuous

change

Opportunities for continuous improvement

Ability to manage change

effectively

Efficiency and effectiveness

of existing strategies

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.8

Power and Politics• Relative power of organisation• Political activity

– Legitimate or illegitimate– Vertical or lateral– Internal or external

• Bases of power– reward and coercive power– legitimate– personal– expert– information– visible/invisible - ability to prevent decisions, control issues,

ensure certain issues are ignored

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.9

Paradigm

Controls

Organisation

Symbols

Stories

Rituals and

Routines

Power

CULTURAL WEB

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.10

Force Field Analysis

Equilibrium

Forces for change

Driving forces

Forces resisting change

Restraining forces

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.11

Change resistance grid

Resistors Undecided

Undecided Supporters

High change

resistantorganisatio

n

Low change

resistantorganisatio

n

Dis

sati

sfi

ed

Sati

sfi

ed

Exte

nt

to w

hic

h e

mp

loyees

are

sati

sfied w

ith

the s

tatu

s qu

o

Distrust Trust

Extent to which employees trust the organisation

Sourc

e:

Adapte

d f

rom

Wit

te (

1990

)

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.12

Nature of Change

Tuning Planned transformational

Adaptation Forced transformational

Reacti

ve

Pro

acti

ve

MA

NA

GE

MEN

T R

OLE

IncrementalChange

TransformationalChange

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.13

Overcoming Resistance

• Education and communication

• Participation and involvement

• Facilitation and support

• Negotiation and agreement

• Manipulation and co-option

• Explicit and implicit coercion

Kotter & Schlesinger (1979)

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.14

Prescriptive Approaches to Change

• Unfreezing– readiness to acquire or learn

new behaviour

• Change– Trying out new ideas– Altered power structures– Change champion

• Refreezing (participation, involvement & commitment– New behaviour patterns are

accepted– Supportive

– Rewards Lewin

1947

• Changing Identity of Organisation

– Response to environment• Coordination & Transition

- 5 Phases of organisational growth

• Control over organisational politics

Kanter Stein and Jick 1992

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.15

Emergent Approaches to Change

(Continuous)

Learning Theory– Team learning– Sharing views/vision– Exploring/ changing

ritual & beliefs– Skills development– Systems

management

Senge 1990

Five Factors Theory• Environmental Assessment

• Leading change

• Linking strategic and operational change

• Strategic human resource management

• Coherence • Consistency• Consonance

• Competitive advantage• Feasibility

Pettigrew & Whipp 1991

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.16

Internal change implementation

Gain support of key decisions makers and facilitators Change attitudes among employees who deal with customers Obtain employees’ commitment to making the strategic plan

work by • involving them in the ownership of the plan• rewarding them on the plans’ attainment

Train staff - develop new skills that will contribute to the effective implementation of plans

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.17

Exhibit 14.2 Types of changeSource: Adapted from J. Balogun and V. Hope Hailey, Exploring Strategic Change, 2nd Edn, Prentice Hall, Pearson Education Ltd, 1999

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.18

Exhibit 14.3 Contextual features of strategic change programmes

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.19

Exhibit 14.4 A forcefield analysis

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.20

Exhibit 14.5 Styles of managing strategic change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.21

Exhibit 14.6 Organisational rituals and culture change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.22

Exhibit 14.7 Political mechanisms in organisations

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008

Slide 14.23

Exhibit 14.8 Turnaround: revenue generation and cost reduction steps