Chapter TwentyChapter Twenty

Managing Change inManaging Change inLearning OrganizationsLearning Organizations

Chapter Twenty OutlineChapter Twenty Outline Forces of ChangeForces of Change

- External Forces- External Forces- Internal Forces- Internal Forces

Models and Dynamics of Planned ChangeModels and Dynamics of Planned Change- Types of Change- Types of Change- Lewin’s Change Model- Lewin’s Change Model- A Systems Model of Change- A Systems Model of Change- Kotter’s Eight Steps for Leading Organizational Change- Kotter’s Eight Steps for Leading Organizational Change- Organization Development- Organization Development

Understanding and Managing Resistance to ChangeUnderstanding and Managing Resistance to Change- Why People Resist Change in the Workplace- Why People Resist Change in the Workplace- Research on Resistance to Change- Research on Resistance to Change- Alternative Strategies for Overcoming Resistance to Change- Alternative Strategies for Overcoming Resistance to Change

Creating a Learning OrganizationCreating a Learning Organization- Defining a Learning Organization- Defining a Learning Organization- Building an Organizations’ Learning Capability- Building an Organizations’ Learning Capability- Organizations Naturally Resist Learning- Organizations Naturally Resist Learning- Effective Leadership Is the Solution- Effective Leadership Is the Solution- Unlearning the Organization- Unlearning the Organization

20-1

The External and Internal Forces The External and Internal Forces for Changefor Change

20-2Figure 20-1

Demographic Characteristics*Age *Education* Skill level *Gender* Immigration Technological Advancements* Manufacturing automation* Office automation Market Changes* Mergers and acquisitions* Domestic and international competition* Recession Social and Political Pressures*War *Values* Leadership

External Forces

Human Resource Problems/Prospects*Unmet needs *Job dissatisfaction*Productivity *Participation/*Absenteeism and suggestions turnover

Managerial Behavior/Decisions* Conflict * Leadership* Reward systems * Structural

reorganization

Internal Forces

The need for change

Forces of ChangeForces of Change

Demographic CharacteristicsDemographic Characteristics- the workforce is more diverse- the workforce is more diverse- there is a business imperative to effectively manage diversity- there is a business imperative to effectively manage diversity

Technological AdvancementsTechnological Advancements- organizations are increasingly using technology as a means to- organizations are increasingly using technology as a means to improve productivity and market competitiveness improve productivity and market competitiveness

Market ChangesMarket Changes- the emergence of a global economy is forcing companies to be- the emergence of a global economy is forcing companies to be more competitive and to do business differently more competitive and to do business differently- organizations are forging new partnerships and alliances aimed at- organizations are forging new partnerships and alliances aimed at creating new products and services creating new products and services

Social and Political PressuresSocial and Political Pressures- society and its legislative bodies can put pressure on organizations- society and its legislative bodies can put pressure on organizations to change the way they do business -- the tobacco industry is a to change the way they do business -- the tobacco industry is a good example good example

20-3a

External Forces: originate outside the organization.

Forces of Change (continued)Forces of Change (continued)

Human Resource Problems/ProspectsHuman Resource Problems/Prospects- employees’ needs, job satisfaction, organizational commitment,- employees’ needs, job satisfaction, organizational commitment, behavior, and performance are forces of change behavior, and performance are forces of change- dissatisfied employees and high levels of absenteeism and- dissatisfied employees and high levels of absenteeism and turnover are signs that change is needed turnover are signs that change is needed

Managerial Behavior/DecisionsManagerial Behavior/Decisions- the level of conflict between managers and their direct reports is a- the level of conflict between managers and their direct reports is a force for change force for change- inappropriate leader behavior may result in employee problems- inappropriate leader behavior may result in employee problems requiring change requiring change- inequitable reward systems are an additional force for change- inequitable reward systems are an additional force for change

20-3b

Internal Forces: originate inside the organization.

Ethics at WorkEthics at Work

Key Issue:

Should parent companieslocated in the U.S. be held

accountable for how employees are treated

in supplierplants in other

countries?

20-4

A Generic Typology of A Generic Typology of Organizational ChangeOrganizational Change

20-5Figure 20-2

Adaptivechange

Innovativechange

Radicallyinnovative

change

Reintroducing afamiliar practice

Introducing apractice new to the

organization

Introducing apractice new to

the industry

Low High• Degree of complexity, cost and uncertainty• Potential for resistance to change

Assumptions About ChangeAssumptions About Change The change process involves learning something new, as well as The change process involves learning something new, as well as

discontinuing current attitudes, behaviors, or organizational practices.discontinuing current attitudes, behaviors, or organizational practices. Change will not occur unless there is motivation to change. This is Change will not occur unless there is motivation to change. This is

often the most difficult part of the change process.often the most difficult part of the change process. People are the hub of all organizational changes. Any change, whether People are the hub of all organizational changes. Any change, whether

in terms of structure, group process, reward systems, or job design, in terms of structure, group process, reward systems, or job design, requires individuals to change.requires individuals to change.

Resistance to change is found even when the Resistance to change is found even when the goals of change are highly desirable.goals of change are highly desirable.

Effective change requires reinforcing Effective change requires reinforcing new behaviors, attitudes, and organizational new behaviors, attitudes, and organizational practicespractices..

20-6

Lewin’s Change ModelLewin’s Change Model UnfreezingUnfreezing

- Creates the motivation to change- Creates the motivation to change- Encourages the replacement of old behaviors and attitudes with- Encourages the replacement of old behaviors and attitudes with those desired by management those desired by management- Entails devising ways to reduce barriers to change- Entails devising ways to reduce barriers to change- Creates psychological safety- Creates psychological safety

ChangingChanging- Provides new information, new behavioral models, or new ways of- Provides new information, new behavioral models, or new ways of looking at things looking at things- Helps employees learn new concepts or points of view- Helps employees learn new concepts or points of view- Role models, mentors, experts, benchmarking results, and training- Role models, mentors, experts, benchmarking results, and training are useful mechanisms to facilitate change are useful mechanisms to facilitate change

RefreezingRefreezing- Helps employees integrate the changed behavior or attitude into- Helps employees integrate the changed behavior or attitude into their normal way of doing things their normal way of doing things- Positive reinforcement is used to reinforce the desired change- Positive reinforcement is used to reinforce the desired change- Coaching and modeling help reinforce the stability of change- Coaching and modeling help reinforce the stability of change

20-7

A Systems Model of ChangeA Systems Model of Change20-8

Figure 20-3

Target Elements of Change

OrganizingArrangements

GoalsSocial Factors

Methods

People

Internal* Strengths

* WeaknessesExternal

* Opportunities* Threats

* OrganizationalLevel

* Department/group level* Individual

level

Inputs Outputs

Str

ateg

y

Kotter’s Steps for Leading Kotter’s Steps for Leading Organizational ChangeOrganizational Change

StepStep DescriptionDescription Establish a senseEstablish a sense Unfreeze the organization by creating aUnfreeze the organization by creating a

of urgencyof urgency compelling reason for why change is needed.compelling reason for why change is needed. Create the guidingCreate the guiding Create a cross-functional, cross-level group ofCreate a cross-functional, cross-level group of

coalitioncoalition people with enough power to lead the change.people with enough power to lead the change. Develop a visionDevelop a vision Create a vision and strategic plan to guide theCreate a vision and strategic plan to guide the

and strategyand strategy change process.change process. Communicate theCommunicate the Create and implement a communication strategyCreate and implement a communication strategy

change visionchange vision that consistently communicates the new visionthat consistently communicates the new visionand strategic plan.and strategic plan.

Empower broad-Empower broad- Eliminate barriers to change, and use targetEliminate barriers to change, and use targetbased actionbased action elements of change to transform theelements of change to transform the

organization. Encourage risk taking andorganization. Encourage risk taking andcreative problem-solving.creative problem-solving.

20-9a

Table 20-1a

Kotter’s Steps for Leading Kotter’s Steps for Leading Organizational Change (continued)Organizational Change (continued)

StepStep DescriptionDescription Generate short-Generate short- Plan for and create short-term “wins” orPlan for and create short-term “wins” or

term winsterm wins improvements. Recognize and reward peopleimprovements. Recognize and reward peoplewho contribute to the wins.who contribute to the wins.

Consolidate gainsConsolidate gains The guiding coalition uses credibility fromThe guiding coalition uses credibility fromand produce moreand produce more short-term wins to create more change.short-term wins to create more change.changechange Additional people are brought into the changeAdditional people are brought into the change

process as change cascades throughout theprocess as change cascades throughout theorganization. Attempts are made to organization. Attempts are made to reinvigorate the change process.reinvigorate the change process.

Anchor newAnchor new Reinforce the changes by highlightingReinforce the changes by highlightingapproaches in theapproaches in the connections between new behaviors and connections between new behaviors and cultureculture processes and organizational success. Developprocesses and organizational success. Develop

methods to ensure leadership development andmethods to ensure leadership development andsuccesses.successes.

20-9b

Table 20-1b

Characteristics of OrganizationCharacteristics of OrganizationDevelopment (OD)Development (OD)

OD involves profound changeOD involves profound change OD is value loadedOD is value loaded OD is a diagnosis/prescription cycleOD is a diagnosis/prescription cycle OD is process-orientedOD is process-oriented

20-10

Table 20-1

Resistance To ChangeResistance To Change

The leading reasons why people resist change are:The leading reasons why people resist change are: An individual’s predisposition toward changeAn individual’s predisposition toward change Surprise and fear of the unknownSurprise and fear of the unknown Climate of mistrustClimate of mistrust Fear of failureFear of failure Loss of status and/or job securityLoss of status and/or job security Peer pressurePeer pressure Disruption of cultural traditions and/or group relationshipsDisruption of cultural traditions and/or group relationships Personality conflictsPersonality conflicts Lack of tact and/or poor timingLack of tact and/or poor timing Nonreinforcing reward systemsNonreinforcing reward systemsFor Class DiscussionFor Class Discussion: What do you think are the top three reasons people resist : What do you think are the top three reasons people resist

change?change?

20-11

Resistance to Change: an emotional/behavioral response to real or imagined work change.

Strategies for Overcoming Strategies for Overcoming Resistance to ChangeResistance to Change

ApproachApproach Education + CommunicationEducation + Communication Participation + InvolvementParticipation + Involvement

Commonly UsedCommonly Used Where there is a lack ofWhere there is a lack of Where the initiators do notWhere the initiators do notin Situationsin Situations information or inaccurateinformation or inaccurate have all the information theyhave all the information they

information and analysisinformation and analysis need to design the changeneed to design the changeand where others haveand where others haveconsiderable power to resistconsiderable power to resist

AdvantagesAdvantages Once persuaded, people willOnce persuaded, people will People who participate willPeople who participate willoften help with the implementationoften help with the implementation be committed to implementingbe committed to implementingof the changeof the change change, and any relevantchange, and any relevant

information they have will beinformation they have will beintegrated into the change planintegrated into the change plan

DrawbacksDrawbacks Can be very time consumingCan be very time consuming Can be very time consumingCan be very time consumingif lots of people are involvedif lots of people are involved if participators design anif participators design an

inappropriate changeinappropriate change

20-12a

Table 20-2a

Strategies for Overcoming Resistance Strategies for Overcoming Resistance to Change (continued)to Change (continued)

ApproachApproach Facilitation + SupportFacilitation + Support Negotiation + AgreementNegotiation + Agreement

Commonly UsedCommonly Used Where people are resistingWhere people are resisting Where someone or some groupWhere someone or some groupin Situationsin Situations because of adjustment problemsbecause of adjustment problems will clearly lose out in a will clearly lose out in a

change and where that groupchange and where that grouphas considerable power to resisthas considerable power to resist

AdvantagesAdvantages No other approach works as wellNo other approach works as well Sometimes it is a relativelySometimes it is a relativelywith adjustment problemswith adjustment problems easy way to avoid majoreasy way to avoid major

resistanceresistance

DrawbacksDrawbacks Can be time consuming, expensiveCan be time consuming, expensive Can be too expensive in manyCan be too expensive in manyand still failand still fail cases if it alerts others tocases if it alerts others to

negotiate for compliancenegotiate for compliance

20-12b

Table 20-2b

Strategies for Overcoming Resistance Strategies for Overcoming Resistance to Change (continued)to Change (continued)

ApproachApproach Manipulation + Co-optationManipulation + Co-optation Explicit + Implicit CoercionExplicit + Implicit Coercion

Commonly UsedCommonly Used Where other tactics will notWhere other tactics will not Where speed is essential Where speed is essential andandin Situationsin Situations work or are too expensivework or are too expensive where the change initiatorswhere the change initiators

possess considerable powerpossess considerable power

AdvantagesAdvantages It can be a relatively quick andIt can be a relatively quick and It is speedy and can overcomeIt is speedy and can overcomeinexpensive solution toinexpensive solution to any kind of resistanceany kind of resistanceresistance problemsresistance problems

DrawbacksDrawbacks Can lead to future problems ifCan lead to future problems if Can be risky if it leaves peopleCan be risky if it leaves peoplepeople feel manipulatedpeople feel manipulated mad at the initiatorsmad at the initiators

20-12c

Table 20-2c

Building an Organization’s Building an Organization’s Learning CapabilityLearning Capability

20-13

Figure 20-5

Facilitatingfactors

Learningmode

Culture and experience

Internalstructure and

processes

An organization’slearning capability

Customersatisfaction

Organizationalperformance

Salesgrowth

Profitability

Factors That FacilitateFactors That FacilitateOrganizational LearningOrganizational Learning

Scanning imperativeScanning imperative Performance gapPerformance gap Concern for measurementConcern for measurement Experimental mindsetExperimental mindset Climate of opennessClimate of openness Continuous educationContinuous education Operational varietyOperational variety Multiple advocatesMultiple advocates Involved leadershipInvolved leadership Systems perspectiveSystems perspective

20-14

Table 20-3

Leadership Roles and ActivitiesLeadership Roles and Activitiesfor Building a Learning for Building a Learning

OrganizationOrganizationRole 1: Role 2: Role 1: Role 2: Role 3:Role 3:Build aBuild a Work to Work to Work toWork toCommitment Generate Commitment Generate GeneralizeGeneralizeto Learningto Learning Ideas with Ideas with Ideas withIdeas with

Leadership ActivitiesLeadership Activities Impact Impact ImpactImpactMake learning a componentMake learning a component X X

of the vision andof the vision andstrategic objectivesstrategic objectives

Invest in learningInvest in learning X XPublicly promote the valuePublicly promote the value X X

of learningof learningMeasure, benchmark, andMeasure, benchmark, and X X

track learningtrack learningCreate rewards and symbols XCreate rewards and symbols X

of learningof learningImplement continuousImplement continuous X X

improvement programsimprovement programs

20-15a

Table 20-4a

Leadership Roles and ActivitiesLeadership Roles and Activitiesfor Building a Learning Organizationfor Building a Learning Organization

(continued)(continued)Role 1: Role 2: Role 1: Role 2: Role 3:Role 3:Build aBuild a Work to Work to Work toWork toCommitment GenerateCommitment Generate GeneralizeGeneralizeto Learningto Learning Ideas with Ideas with Ideas withIdeas with

Leadership ActivitiesLeadership Activities Impact Impact ImpactImpactIncrease employeeIncrease employee X X

competence throughcompetence throughtraining, or buy talenttraining, or buy talentfrom outside the from outside the organizationorganization

Experiment with new ideas,Experiment with new ideas, X Xprocesses, and structuralprocesses, and structuralarrangementsarrangements

Go outside the organizationGo outside the organization X Xto identify world-class to identify world-class ideas and processesideas and processes

20-15b

Table 20-4b

Leadership Roles and ActivitiesLeadership Roles and Activitiesfor Building a Learning Organizationfor Building a Learning Organization

(continued)(continued)Role 1: Role 2: Role 3:Role 1: Role 2: Role 3:Build aBuild a Work to Work to Work to Work toCommitment Generate GeneralizeCommitment Generate Generalizeto Learningto Learning Ideas with Ideas with Ideas with Ideas with

Leadership ActivitiesLeadership Activities Impact Impact Impact ImpactIdentify mental models ofIdentify mental models of X X

organizational processesorganizational processesInstill systems thinkingInstill systems thinking X X

throughout the organizationthroughout the organizationCreate an infrastructure thatCreate an infrastructure that X X

moves ideas acrossmoves ideas acrossorganizational boundariesorganizational boundaries

Rotate employees acrossRotate employees across X Xfunctional and divisionalfunctional and divisionalboundariesboundaries

20-15c

Table 20-4c