notes - managing change in organizations

7/30/2019 Notes - Managing Change in Organizations

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Managing Change in Organizations

I. FORCES FOR CHANGEA. Organizations face a dynamic and changing environment. This requires adaptation.

Nature of the workforce:

1. A multicultural environment2. Human resource policies and practices changed to attract and keep this more diverse

workforce.

3. Large expenditure on training to upgrade reading, math, computer, and other skills ofemployees

B. Technology is changing jobs and organizations:1. Sophisticated information technology is also making organizations more responsive.

As organizations have had to become more adaptable, so too have their employees.

C. Economic shocks:1. We live in an age of discontinuity. Beginning in the early 1970s with the overnight

quadrupling of world oil prices, economic shocks have continued to impose changes

on organizations.2. In India, during the world-wide recession in 200709, companies such as Dunlop, VF

Arvind, and TCS had asked many of their employees to not report to work.

D. Competition is changing:1. The global economy means global competitors.2. Established organizations need to defend themselves against both traditional

competitors and small, entrepreneurial firms with innovative offerings.

3. Successful organizations will be the ones that can change in response to thecompetition.

E. Social trends during the past generation suggest changes that organizations have to adjustfor:

1. The expansion of the Internet2. Environmental concerns

F. World politics:1. A global context for OB is required. No one could have imagined how world politics

would change in recent years.

II. PLANNED CHANGEA. Some organizations treat all change as an accidental occurrence; however, change as an

intentional, goal-oriented activity is planned change.

B. There are two goals of planned change:1. Improve the ability of the organization to adapt to changes in its environment.2. Change employee behavior.

C.Examples of planned-change activities are needed to stimulate innovation, empoweremployees, and introduce work teams.

D. An organizations success or failure is essentially due to the things that employees do orfail to do, so planned change is also concerned with changing the behavior of individualsand groups within the organization.

E. Who in organizations are responsible for managing change activities?1. Change agents can be managers, employees of the organization, or outside

consultants.


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a. Indian Railways saw a major change in their operations when the leadershipchanged from Lalu Prasad Yadav to Mamata Benerjee.

b. Lalit Modi changed the landscape of cricket globally when he took over the reinsat the Indian Premier League (IPL).

c. As chairman of ITC, Yogesh Chander Deveshwar changed old business methodsto bring ITC out of its legal, financial and organizational troubles.

2. Typically, we look to senior executives as agents of change.F. Many change agents fail because of organizational resistance to change.

III. RESISTANCE TO CHANGEA. Introduction

1. Our egos are fragile, and we often see change as threatening.a. One recent study showed that even when employees are shown data that suggest

they need to change, they latch onto whatever data they can find that suggests

they are okay and dont need to change.

b. Employees who have negative feelings about a change cope by not thinking aboutit, increasing their use of sick time, and quitting.c. All these reactions can sap the organization of vital energy when it is mostneeded.

2. Resistance to change can be positive if it leads to open discussion and debate.a. These responses are usually preferable to apathy or silence and can indicate that

members of the organization are engaged in the process, providing change agents

an opportunity to explain the change effort.b. Change agents can also use resistance to modify the change to fit the preferences

of other members.

3. Resistance to change does not necessarily surface in standardized ways.a. Resistance can be overt, implicit, immediate, or deferred.

i. It is easiest for management to deal with resistance when it is overt andimmediate.

ii. Implicit resistance efforts are more subtleloss of loyalty to the organization,loss of motivation to work, increased errors or mistakes, increased

absenteeism due to sicknessand hence more difficult to recognize.

iii. Similarly, deferred actions cloud the link between the source of the resistanceand the reaction to it.

b. A change may produce what appears to be only a minimal reaction at the time it isinitiated, but then resistance surfaces weeks, months, or even years later.

c. Reactions to change can build up and then explode seemingly totally out ofproportion.

d. The resistance was deferred and stockpiled, and what surfaces is a cumulativeresponse.

4. The major forces for resistance to change categorized by their sources.a. Five reasons why individuals may resist change are:

i. Habit: Life is complex; to cope with having to make hundreds of decisionsevery day, we all rely on habits or programmed responses.

ii. Security: People with a high need for security are likely to resist changebecause it threatens their feelings of safety.


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iii. Economic factors: Another source of individual resistance is concern thatchanges will lower ones income.

iv. Fear of the unknown: Changes substitute ambiguity and uncertainty for theknown.

v. Selective information processing: Individuals shape their world through theirperceptions. Once they have created this world, it resists change.

b. There are five major sources of organizational resistance:i. Structural inertia: Organizations have built-in mechanisms to produce

stability; this structural inertia acts as a counterbalance to sustainability.

ii. Limited focus of change: Organizations are made up of a number ofinterdependent subsystems. Changing one affects the others.

iii. Group inertia: Group norms may act as a constraint.iv. Threat to expertise: Changes in organizational patterns may threaten the

expertise of specialized groups.

v. Threat to established power relationships: Redistribution of decision-makingauthority can threaten long-established power relationships.c. Threat to established resource allocations can also be a source of organizational

resistance Groups in the organization that control sizable resources often seechange as a threat. They tend to be content with the way things are.

5. Its worth noting that not all change is good.a. Speed can lead to bad decisions, and sometimes those initiating change fail to

realize the full magnitude of the effects or their true costs.b. Rapid, transformational change is risky, and some organizations, such as Baring

Brothers Bank in the United Kingdom, have collapsed for this reason.

B. Overcoming resistance to change1. Education and communication

a. Resistance can be reduced on two levels through communicating to helpemployees see the logic of a change.

i. It fights the effects of misinformation and poor communication: if employeesreceive the full facts and clear up misunderstandings, resistance should

subside.

ii. Communication can help sell the need for change by packaging it properly.2. Participation

a. It is difficult for individuals to resist a change decision in which they participated.b. Prior to making a change, those opposed can be brought into the decision process,

assuming they have the expertise to make a meaningful contribution.

c. The negativespotential for a poor solution and great time consumption.3. Building support and commitment.

a. When employees fear and anxiety are high, counseling and therapy, new-skillstraining, or a short paid leave of absence may facilitate adjustment.

b. When managers or employees have low emotional commitment to change, theyfavor the status quo and resist it.

c. So firing up employees can also help them emotionally commit to the changerather than embrace the status quo.

4. Develop positive relationships


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a. People are more willing to accept changes if they trust the managersimplementing them.

i. One study surveyed 235 employees from a large housing corporation in theNetherlands that was experiencing a merger.

ii. Those who had a more positive relationship with their supervisors, and whofelt that the work environment supported development, were much morepositive about the change process.

5. Implementing changes fairlya. Organizations can minimize negative impact by making sure that employees see

the reason for the change and perceive its implementation as consistent and fair.

6. Manipulation and cooptationa. Manipulation refers to covert influence attempts, twisting and distorting facts to

make them appear more attractive, withholding undesirable information, and

creating false rumors to get employees to accept a change.b. Cooptation is a form of both manipulation and participation. It seeks to buy

off the leaders of a resistance group by giving them a key role in the change

decision.c. Both manipulation and cooptation are relatively inexpensive and easy ways togain support. The tactics can backfire if the targets become aware that they arebeing tricked or used.

7. Selecting people who accept changea. Research suggests the ability to easily accept and adapt to change is related to

personalitysome people simply have more positive attitudes about change thanothers.

i. Such individuals are open to experience, take a positive attitude towardchange, are willing to take risks, and are flexible in their behavior.

ii. One study of managers in the United States, Europe, and Asia found thosewith a positive self-concept and high-risk tolerance coped better with

organizational change.

iii. A study of 258 police officers found those higher in growth-needs strength,internal locus of control, and internal work motivation had more positive

attitudes about organizational change efforts.

iv. Another study found that selecting people based on a resistance-to-changescale worked well in winnowing out those who tended to be rigid or react

emotionally to change.

b. Individuals higher in general mental ability are also better able to learn and adaptto changes in the workplace.

c. In sum, an impressive body of evidence shows organizations can facilitate changeby selecting people predisposed to accept it.

8. Coerciona. This is the application of direct threats or force upon the resisters.b. Examples of coercion are threats of transfer, loss of promotions, negative

performance evaluations, and a poor letter of recommendation.

IV. APPROACHES TO MANAGING ORGANIZATIONAL CHANGEA. Lewins three-step model


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1. Kurt Lewin argued that successful change in organizations should follow three steps:a. Unfreezing the status quob. Movement to a new statec. Refreezing the new change to make it permanent

2. The status quo can be considered to be an equilibrium state.a.

To move from this equilibriumto overcome the pressures of both individualresistance and group conformityunfreezing must happen in one of the following

three ways;

i. The driving forces, which direct behavior away from the status quo, can beincreased.

ii. The restraining forces, which hinder movement from the existing equilibrium,can be decreased.

iii. A third alternative is to combine the first two approaches.b. Once the change has been implemented, the new situation needs to be refrozen so

that it can be sustained over time.

i. Unless this last step is taken, there is a very high chance that the change willbe short-lived and that employees will attempt to revert to the previousequilibrium state.

ii. The objective of refreezing is to stabilize the new situation by balancing thedriving and restraining forces.

Change Management Curve

Also called as the Kubler Ross transition cycle. These stages are:

Denial

Anger Bargaining Depression AcceptanceThe 'grief cycle' is actually a 'change model' for helping to understand and deal with (and

counsel) personal reaction to trauma. It's not just for death and dying.

This is because trauma and emotional shock are relative in terms of effect on people. Whiledeath and dying are for many people the ultimate trauma, people can experience similar

emotional upsets when dealing with many of life's challenges, especially if confronting

something difficult for the first time, and/or if the challenge happens to threaten an area of

psychological weakness, which we all possess in different ways. One person's despair (a job-change, or exposure to risk or phobia, etc) is to another person not threatening at all. Some

people love snakes and climbing mountains, whereas to others these are intensely scary

things. Emotional response, and trauma, must be seen in relative not absolute terms. Themodel helps remind us that the other person's perspective is different to our own, whether we

are the one in shock, or the one helping another to deal with their upset.


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Stage Interpretation

1 - Denial

Denial is a conscious or unconscious refusal to accept

facts, information, reality, etc., relating to the situationconcerned. It's a defence mechanism and perfectly

natural. Some people can become locked in this stagewhen dealing with a traumatic change that can beignored.

2 - Anger

Anger can manifest in different ways. People dealing

with emotional upset can be angry with themselves,

and/or with others, especially those close to them.

Knowing this helps keep detached and non-judgemental when experiencing the anger of someone

who is very upset.

3 - Bargaining

Traditionally the bargaining stage for people facing

death can involve attempting to bargain with whateverGod the person believes in. People facing less serioustrauma can bargain or seek to negotiate a compromise.

For example "Can we still be friends?.." when facing a

break-up. Bargaining rarely provides a sustainablesolution, especially if it's a matter of life or death.

4 - Depression

Also referred to as preparatory grieving. In a way it's

the dress rehearsal or the practice run for the

'aftermath' although this stage means different things

depending on whom it involves. It's a sort ofacceptance with emotional attachment. It's natural to

feel sadness and regret, fear, uncertainty, etc. It showsthat the person has at least begun to accept the reality.

5 - Acceptance

Again this stage definitely varies according to theperson's situation, although broadly it is an indication

that there is some emotional detachment and

objectivity. People dying can enter this stage a long

time before the people they leave behind, who mustnecessarily pass through their own individual stages of

dealing with the grief.

notes - managing change in organizations

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