Management, 14e Chapter 11 PDF

Management, 14e Chapter 11: Managing Innovation and Change ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied...

Management, 14e Chapter 11: Managing Innovation and Change ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 1  Icebreaker Good, Bad, or Indifferent? Either by reflecting individually or forming small groups with several other students, consider the following: − Write down all the words you can that suggest change. − For each of those words, indicate whether you see it as a negatively charged word, a positively charged word, or a neutral word. − What does your response to these words signal to you about how you think about change? ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 2  Learning Objectives (1 of 2) By the end of this chapter you should be able to: 1. Explain disruptive innovation and the ambidextrous approach as possible responses to the forces that drive innovation and change in today’s organizations. 2. Describe the innovation strategies that managers implement for changing products and workflow technologies, such as a bottom-up approach and open innovation. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3  Learning Objectives (2 of 2) By the end of this chapter you should be able to: 3. Describe how managers apply the stages of unfreezing, changing, and refreezing to bring about changes in the culture and people of an organization. 4. Identify some reasons why people resist change and the implementation tactics that managers can use to overcome resistance. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 4  Innovation and the Changing Workplace (LO 1) Organizational innovation: creation of a new idea, solution, or behavior by an organization Causes of change − Outside forces − Managers Change concepts − Disruptive innovation − Ambidextrous approach ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 5  Disruptive Innovation (LO 1) Disruptive innovation: innovations in products or services that typically start small and end up completely replacing an existing product or service technology for products and consumers − Becoming a goal for global companies − Many come from small entrepreneurial firms Companies use self-disruption to preempt being disrupted by other companies or start-ups Reverse innovation: creating innovative low-cost products for emerging markets and then quickly and inexpensively repackaging them for sale in developed countries ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 6  Discussion Activity 1 Think about the rise of Esports, which is competition using multiplayer video games. In what ways is it a disruptive technology? ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 7  Discussion Activity 1 Debrief Think about the rise of Esports, which is competition using multiplayer video games. In what ways is it a disruptive technology? − With the rise of livestreaming, the popularity of esports has exploded. Total audience numbers topped 450 million viewers, with revenues over US$1 billion. Numerous video games are now played as sports franchises, including national and international competitions. These competitions do not require large venues and other physical assets. They can be viewed by millions simultaneously, as can televised sports events. − Traditional sports are also televised, with millions of viewers, but they depend on advertising revenue as well as large venues for fans. − With the pandemic, traditional sports has even more incentive to learn from esports. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 8  Ambidextrous Approach (LO 1) Ambidextrous companies can create and implement ideas Ambidextrous approach: incorporating structures and processes that are appropriate both for the creative impulse and for the systematic implementation of innovations − Exploration: encouraging creativity, risk taking, experimentation, and the development of new ideas − Exploitation: implementing new ideas with established capabilities and routines. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 9  Changing Things: New Products and Technologies (LO 2) Product innovation: a change in the organization’s product or service outputs Process innovation: a change in the organization’s production processes Technology change: a change in the organization’s production process Three innovation strategies for products and processes − Discovery − Horizontal collaboration and open innovation − Innovative roles and structures ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 10 11.1 Three Innovation Strategies (LO 2) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 11  Discovery (LO 2) Discovery is the stage where ideas for new products and technologies are born Creativity: generation of novel ideas that might meet perceived needs or respond to opportunities for the organization Bottom-up approach: encouraging the flow of ideas from lower levels ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 12 11.2 Characteristics of Creative People and Organizations (LO 2) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 13 11.3 World’s Most Innovative Companies, 2020 (LO 2) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 14 Horizontal Collaboration and Open Innovation (1 of 2) (LO 2) Characteristics of innovative companies − Work with customers to understand needs and develop solutions − Use new technology effectively − Shared new product development process supported by top management − Members from key departments cooperate in development of new product or service − Cross-functional team guides project from beginning to end ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 15 Horizontal Collaboration and Open Innovation (2 of 2) (LO 2) Horizontal linkage model: research, manufacturing, and sales, and marketing simultaneously contribute to new products and technologies Open innovation: search for and commercialization of new ideas beyond the organization and industry − Crowdsourcing: approach to open innovation that involves obtaining information, ideas, or opinions from a large group of people − Innovation by acquisition: buying start-up companies ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 16  Polling Activity 1 Have you participated in crowdsourcing in any of following ways? a. Wikipedia b. Kickstarter c. Gofundme d. Waze e. Airbnb ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 17 11.4 Coordination Model for Innovation (LO 2) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 18  Innovation Roles and Structures (1 of 2) (LO 2) Corporate intrapreneurship: development of an internal entrepreneurial spirit, philosophy, and structure to encourage employees to act like entrepreneurs Idea champion: person who sees the need for and enthusiastically supports productive change within the organization Idea incubator: organizational program that provides a safe harbor where employees can generate and develop ideas without interference from company bureaucracy or politics ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 19  Innovation Roles and Structures (2 of 2) (LO 2) New-venture team: unit separate from the rest of the organization that is responsible for developing and initiating a major innovation Skunkworks: separate, small, informal, autonomous, secretive group that focuses on breakthrough ideas for the business In-house venture: a start-up that a company launches within the company rather than as a separate entity. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 20  Knowledge Check 1 A person who sees the need for productive change in an organization and puts effort into making that change happen is known as a. a change catalyst b. an ambidextrous explorer c. an idea champion d. an idea incubator ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 21  Knowledge Check 1: Answer A person who sees the need for productive change in an organization and puts effort into making that change happen is known as c. an idea champion ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 22  Changing People and Culture (LO 3) People change: changes to the mind-set of a few employees Culture change: changes to the mind-set of the organization as a whole Tools that smooth the culture change process − Training and development programs − Organization development ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 23  Training and Development (LO 3) Training is a frequently used approach to changing people’s mind-sets Training programs can be offered to large blocks of employees Emphasize training and development for managers − Managers’ behavior and attitudes will influence people and lead to culture change ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 24  Knowledge Check 2 In changing the culture and mind-set of employees in the process of implementing organizational change, managers most frequently use which of these approaches? a. Open innovation b. Team building c. Unfreezing and refreezing d. Training ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 25  Knowledge Check 2: Answer In changing the culture and mind-set of employees in the process of implementing organizational change, managers most frequently use which of these approaches? d. Training ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 26  Organization Development (1 of 2) (LO 3) Organization development (OD): planned, systematic process of change that uses behavioral science techniques to create a positive corporate culture and improve the way people and departments relate to one another OD focuses on the human and social aspects of the organization: − Encourage a sense of community − Push for organizational climate of openness and trust − Provide opportunities for personal growth and development − Conflict management ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 27  Organization Development (2 of 2) (LO 3) Popular specialized techniques of organization development: Team building: activities that enhance the cohesiveness and success of organizational groups and teams Survey feedback: begins with an employee questionnaire, and then an OD consultant provides feedback to the employees regarding responses and problems identified Large-group intervention: brings together participants from all parts of the organization to discuss problems or opportunities and plan for change ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 28 11.5 OD Approaches to Culture Change (LO 3) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 29  Implementing Innovation and Change (LO 4) Change: adoption of a new idea by an organization Three-stage model for implementing change: − Unfreezing: making individuals aware of problems and motivating them to change − Changing: individuals experiment with new behavior and learn new skills to use in the workplace − Refreezing: individuals acquire new attitudes or values and are rewarded for them by the organization ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 30 11.6 Lewin’s Three-Stage Model for Implementing Change (LO 4) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 31  Discussion Activity 2 Considering the three change stages of unfreezing, changing, and refreezing, which stage do you think managers in the United States are best at doing? At which one do you think they would be worst? Explain. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 32  Discussion Activity 2 Debrief Considering the three change stages of unfreezing, changing, and refreezing, which stage do you think managers in the United States are best at doing? At which one do you think they would be worst? − The first stage, unfreezing, makes people throughout the organization aware of problems and gets them motivated to accept the change. Changing, occurs when individuals experiment with new behavior and learn new skills to be used in the workplace. Refreezing, occurs when individuals acquire new behaviors or values and are rewarded for adopting them by the organization. − The answer to this depends on the industry and the organization. Organizations that focus on creativity and fast responses might be better at all stages. Organizations that focus on structured activities like manufacturing might have difficulties in all of the stages. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 33  Why Do People Resist Change? (LO 4) Self-interest − Fear of personal loss is perhaps the biggest obstacle to organizational change Lack of understanding and trust Uncertainty Different assessments and goals − Some reasons for resistance are legitimate ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 34  Create a Sense of Urgency (LO 4) A problem or crisis lowers resistance to change Managers must help people feel the need for change Need for change: a disparity between existing and desired performance levels ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 35 11.7 Tactics for Implementing Change (LO 4) ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 36  Polling Activity 2 In each of the following situations, do you believe coercion should be used to implement the change? a. You are the manager of a fast-food restaurant. Your employees are now required to wear face masks while working, even if they don’t have direct contact with customers. b. As a manager, you would like customers to feel your firm delivers superior customer service. Employees are directed to include a form of “Can I help you with anything else?” before ending a customer encounter. c. With so many employees working from home, your company now requires everyone to log off for 15 minutes between 10 and 11 a.m. and between 2 and 3 p.m. for breaks, as well as 30 minutes between 11:30 and 1:30 for lunch. Several employees take all 60 minutes during the lunch window of time. These employees remain as productive as those following the rules. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 37  Summary (1 of 2) Now that the lesson has ended, you should have learned how to: 1. Explain disruptive innovation and the ambidextrous approach as possible responses to the forces that drive innovation and change in today’s organizations. 2. Describe the innovation strategies that managers implement for changing products and workflow technologies, such as a bottom-up approach and open innovation. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 38  Summary (2 of 2) Now that the lesson has ended, you should have learned how to: 3. Describe how managers apply the stages of unfreezing, changing, and refreezing to bring about changes in the culture and people of an organization. 4. Identify some reasons why people resist change and the implementation tactics that managers can use to overcome resistance. ©2022 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 39