Organizational Change PDF

6. Change Organisational change any alterations in the people/structure/tech of an organisation change is normally a response to a significant threat or opportunity arising from outside the organisation Characteristics of change varies in degree and direction produces uncertai...

6. Change Organisational change any alterations in the people/structure/tech of an organisation change is normally a response to a significant threat or opportunity arising from outside the organisation Characteristics of change varies in degree and direction produces uncertainty yet is not completely unpredictable creates both threat and opportunities managing change is an integral part of every manager's job Factors causing change external forces changes in consumer needs and wants new governmental laws and regulations changes in technology economic changes internal forces changes in organisational strategy workforce changes new equipment change in employee attitudes Types of Change structural changing the organisation's structure or its structural components technological adopting new equipment/operating methods that displace old skills and require new ones automation replacing certain tasks done by people with machines computerisation  workforce changing attitudes, expectations, perceptions, and behaviours of the workforce The Manager as Change Agent change agents people who act as catalysts and assume the responsibility for changing process are called change agents these can be employees of the organisation (internal) or external consultants, or indeed both working together the change agent's job is to act as an intermediary, to communicate and co-ordinate in order to facilitate effective change Force Field Analysis this was originally developed by Kurt Lewin he distinguished between driving forces for change (often known as drivers) and restraining forces against change (often known as resistors) if the driving force for change equalled the restraining forces, there would be a position of equilibrium and change would not be possible can be illustrated in a diagram that shows the strength of the drivers and resistors as arrows proportional in length to the perceived relative force of each element the strength/weakness of these drivers and resistors is subjective and will change over time in addition, over a period, some drivers and resistors will disappear while others appear equilibrium is the current position in this position, drivers n resistors are equally balanced usually, equilibrium is shown as a vertical line dividing drivers and resistors as in the example that follows arrows of different lengths are used to show the strength of the different forces for change to happen, drivers must be greater than resistors to get to the desired situation, you need to strengthen the driving forces or weaken the restraining ones DRIVERS (LEFT) higher salaries workforce committed to the change training in new skills charismatic leader RESISTORS (RIGHT)  unclear objectives existing organisational culture wish to retain existing management style fear of the unknown Assets for change factors which do not drive a change themselves and cannot be described as drivers however, they do help the change eg. availability of finance to train people in new skills or the willingness of other stakeholders eg. customers to support the change these are assets, but not drivers assets for change could be: funding in place to implement change good past experience of change support of suppliers, shareholders, etc are organisational strengths that will help a firm when it tries to change, but do not cause it to change eg. a strong corporate culture eg. an experienced management team Some of the general driving and restraining forces that might affect organisations: Lewin's equilibrium - driving and restraining forces for organisational change driving forces (forces for change) changing markets shorter product life cycles changing attitudes towards work internationalisation global markets social transformations increased competition new technology new personnel restraining forces (forces against change) from individuals: fear of failure loss of status  inertia (habit) fear of the unknown loss of friends from organisations strength of culture rigidity of structure sunk costs lack of resources contractual agreements Stages of Change Lewin's description of the change process as a break in the organisation's equilibrium state unfreezing the status quo organisation prepares for the needed change breaking down the beliefs and assumptions that currently exist and opening up an acceptance of the need for change changing to a new state the change process is implemented refreezing to make the change permanent stabilise the new situation by reinforcing the new behaviours this three step model can be expanded to show that the following sequence of activities needs to take place: recognising the need to change defining the problem identifying where the company is positioned relative to the problem searching for alternatives defining where the company wants to be as a result of the change (goals) preparing for change unfreezing (loosening the organisation so it can change) moving (consciously managing the process of change) arriving (realising when the goals have been met) refreezing (stabilising and reinforcing change) evaluation (checking that change has been beneficial - eg. comparing changes to productivity) The Six Step Process  the sequence of activities is normally summarised as a six-step process 1. recognising the need to change 2. preparing for change 3. unfreezing the org 4. managing the change 5. refreezing/stabilising afterwards 6. evaluation Factors to be addressed during a change programme for change to be successful, it is generally agreed that the following are needed: top management commitment constant and consistent communication employee involvement at all levels a shared vision of the future understanding of the need for change management of political networks Resistance to change most change programme will meet resistance in some form from: individuals groups organisations Individuals the key to change within the organisation is the people involved unless individuals are involved, prepared, and committed to adapt and learn, resistance to change will have a significant impact on the change management process there are a number of reasons why individuals are resistant to change: self interest a lack of trust coupled with misunderstanding different viewpoints or assessments of the benefits of change a low tolerance of change eg. 'i don't see the problem' / ' i see the problem but i don't agree with the solution' people respond to changes on three levels: emotional  what will this change mean to me personally? how will my life change? will my position in other people's eyes be different? will i be able to cope with the changes to my role? political will i lose control over resources/people/decisions? will i still be part of some key group? will i start to be able to influence decisions that affect me and my area? rational is this change right for the org? Groups can be significant obstacle to achieving change eg. trade unions have often resisted change on behalf of their members when the perceived impact upon their members has been negative many examples exist where trade unions have resisted changed to existing working practices such as redeployment of tradesmen, changes in working hours, as well as the introduction of new technology which has often led to job losses on the other hand, groups can also be great promoters and supporters of change a common strategy to deal with a lot of individual resistance is to gather together a coalition of like-minded positive people and gradually deal with the resistors Organisational culture and change it worked in the past (? wth is this part of the notes on) just as individuals and groups can significantly affect the change process, so too can organisational culture the way we do things around here large organisations, such as the civil service and large multinational companies have formalised rules, regulations, and procedures these make implementing a process of change even more difficult while they have operated well in a stable environment, they are seriously challenged to a change and adapt to meet today's problems one of the reasons why change can be difficult as we have seen, it can have a negative influence on change to be successful, many changes also involve a change in organisational culture poses a big challenge to management, largely because changing the culture involves making changes in all aspects of how to organisation works  changing the culture of an org can mean making changes in things like: balance of power between different groups and sections in the org management/leadership style organisational structure the way decisions are made the types of jobs that people do Approaches to managing change a number of approaches can be applied to change programmes, including: top down action centred negotiated piecemeal intiatives participative Top-down this type of approach is often associated with an autocratic management style communication is downwards and little attention is paid to the ideas of employees examples include a company making it clear it will relocate the organisation to an area of cheap labour unless lower wages are accepted and/or higher production is achieved this strategy is normally used for large-scale changes of a one-off nature, perhaps a once-only emergency response to a crisis here, time is of the essence and resistance might be expected but has to be overcome quickly Action-centred an organisation starts with a general idea of the problem and tries out various solutions, often by involving those affected eg. quality improvement programmes / customer service improvements all of these are areas where a number of possible solutions exist often companies pilot one solution in a targeted small area, and depending on its success, either they implement that solution on a more widespread basis, or alternatively pilot an alternative solution until success is achieved. Negotiated  communications flow up as well as down the hierarchy and managers try to make use of employee's ideas and opinions the aim is communication in order to resolve differences through agreement eg. changing work patterns in return for higher pay eg. improved productivity in return for bonus payments Piecemeal initiatives change can also be implemented in a piecemeal fashion, with small incremental changes being made over time in some situations, beginning with small projects that are successful is an approach that crates confidence and encouragement to go on and tackle more difficult problems Participative shown by complete confidence and trust between superiors and subordinates employees are free to discuss their jobs and their ideas are welcomed lots of communication and co-operation within their team feedback of information is used for problem solving people who participate will be committed to implementing the change rewards are given on the basis of participation and the achievement of agreed goals Examples of change total quality management materials requirements planning (MRP) just in time (JIT) optimised production tech (OPT) computer integrated manufacture (CIM) programme evaluation and review technique (PERT) team working empowerment the learning org business process re-engineering (BPR) continuous improvement Total Quality Management (TQM) a move away fro inspecting products for quality, to changing the culture of the organisation this is done so that everyone and every process in the org excels in providing the customer with products and services of the highest quality Materials Requirements Planning (MRP) MRP may stand for materials req planning or manufacturing resource planning devised by Oliver Wright and Joseph Orlicky, these computerised methods help to plan and control a business's resources they reconcile supply and demand of resources, forecasting volume and timings for materials given likely future customer demand Just In Time (JIT) a philosophy of providing goods and services to customers only when they are needed developed by the japs this approach ensures the correct quantities are purchased and made at the right time with little/no waste once implemented in one area of a supply chain (eg. manufacturing plant), JIT is often extended to the entire chain from supply of raw materials through to distribution and product delivery to the customer Optimised Production Technology (OPT) a scheduling approach and associated software developed by Eli Goldratt based on the idea of getting the entire production process working together with realistic optimised schedules in order that productivity is improved, throughput increased and both inventory and operating expenses are decreased throughput - the amount of materials or items passing through a system or process seeks to anticipate bottlenecks in the process which disrupt the flow of production and work to ensure that all processes work together to improve total system performance Computer Integrated Manufacture (CIM) a method of planning and control of manufacturing using computers and tech Programme Evaluation and Review Technique (PERT) a management tool for scheduling and controlling projects with the goal of completing projects on time and within budget a number of software packages are available that automate PERT processes the fundamentals of PERT are widely used within all types of orgs Teamworking a number of people working to a common purpose who are set on achieving goals  eg. quality circles Empowerment devolving responsibility down the org to the people best placed to make particular decisions The Learning Org an org that facilitates learning in order to develop and compete successfully Business Process Re-engineering (BPR) a strategy driven, top down redesign of one or more aspects of the business it looks at processes rather than functions such as operations, and has claimed some spectacular success eg. a reduction in the time to meet a large customer order from 180 days to less than 30 however, it has been widely criticised as it is often associated with large-scale redundancies Continuous Improvement a process of ongoing improvements that aggregate over time to provide proof that things are improving called kaizen by the Japanese management procedures involve improvement programmes that focus on waste, use of standards, employees' involvement, improvement and suggestion teams continuous improvement should be supported at all levels within the org, with everyone being encouraged and supported to come up with ideas for further improvement Why Do People Resist Change? the ambiguity and uncertainty that change introduces the comfort of old habits a concern over personal loss of status, money, authority, friendships, and personal convenience the perception that change is not suitable within the goals and interest of the org Issues in Managing Change changing org culture cultures are naturally resistant to change  conditions that facilitate cultural change the occurrence of a dramatic crisis leadership changing hands a young, flexible, and small org a weak org culture Handling Employee Stress due to Change stress is the physical and psychological tension an individual feels when confronted with extraordinary demands, constraints, or opportunities and their associated importance and uncertainties functional stress - stress that has a positive effect on performance how potential stress becomes actual stress when there is uncertainty over the outcome when the outcome is important Making Change Happen Successfully embrace change become a change capable organisation create a simple, compelling message explaining why change is necessary communicate constantly and honestly foster as much employee participation as possible get all employees committed encourage employees to be flexible remove those who resist and cannot be changed