Sensemaking and Performance During Change: Some Preliminary Ideas

1. Sensemaking and Performance During Change: Some Preliminary Ideas Scott Sonenshein and Scott Baggett Rice University

2. Research Question • How does an employee’s sensemaking about change affect change implementation performance?

3. Starting Premises • Change creates interruptions which trigger sensemaking (Weick, 1995) • Employees have discretion to construct meaning of same “objective” event differently • Employees matter--bias in literature that organizational adaptation is primarily (or even) solely driven by top managers

4. Quick Review of Sensemaking Literature • Sensemaking research strong focus on processes (e.g., Weick et al., 2005), less on content • Research on link between sensemaking and performance has emphasized top managers • Thomas et al. (1993): top managers scanning and interpretation processes • Theoretical models about links between cognitions and actions (e.g. Dutton and Jackson, 1987) with key focus on labeling of issues • Threat/opportunity framing (Chattopadhyay et al, 2001; Staw et al., 1981) • Little research on how employees make sense of change (Bartunek et al., 2006) • Any studies that link employee sensemaking to unit/firm performance? • Sensemaking primarily focused on cognitions • Not much work on emotions and sensemaking (Maitlis and Vogus, 2008)

5. Main Contribution of Research • Examine how employees’ sensemaking content (cognitions and emotions) influences change implementation performance • As assessed by managers (subjective performance) • As assessed by sales data (“objective” performance)

6. Subjective Performance: “Ideal Employee” hypothesis • During change, managers want employees to construct meaning of change in particular ways and this will impact how they assess performance. • Greater understanding of the strategy • Create cognitive reorientation of the firm (Gioia & Chittipeddi, 1991) • Transfer cognitions to employees (Lewis, L. & Seibold, 1998) • More positive emotions • Happy-productive worker hypothesis (Wright & Staw, 1999) • Managers observe positive employees, assume things are going well. • Less negative emotions • Reduces resistance, something managers obsessed with (Dent & Goldberg, 1999)

7. “Objective” performance:But do manager’s know best? • Competing Hypotheses • Why would adopting managerial cognitions about the change  higher performance? • Provides higher-order goals, which could increase knowledge about how to perform task objectives • Reduces uncertainty about change, which could limit distractions • Increases task significance (bigger picture of how tasks improve org) • Others? • But cognitions about change . . . • Focuses on general strategy less relevant to employees’ work • Could inundate employees with useless information (info overload) • Others?

8. “Objective” performance: But do manager’s know best? • Competing Hypotheses • Why would sensemaking that contains more positive emotions about the change higher performance? • Increases motivation (George & Brief, 1996) and persistence (Burke et al. 1993) • Builds thought-action repertoire (Fredrickson, 2001) • Increases sense of efficacy (Forgas et al., 1990) • Leads to more helpful behavior (George, 1991) • Others? • But positive emotions could . . . • Reduce motivation because sends signals things going well (George and Zhou, 2002) • Lead to too optimistic of an appraisal of situation • Others?

9. “Objective” performance: But do manager’s know best? • Competing Hypotheses • Why would sensemaking that contains less negative emotions about the change higher performance? • Negative emotions associated with change resistance • Negative emotions could reduce commitment to change • But negative emotions could. . . • Signal that greater effort is needed (George & Zhou, 2001) • Reflect a more realistic appraisal of the change, allowing employees to adjust behaviors

10. Approach • Context: Fortune 500 retailer integrating two divisions • Collected sensemaking of employees implementing the change (n=143) at 46 units implementing same change • Content analysis of sensemaking: • Cognitive sensemaking: meaning constructions of what employees know about the core strategy of the change • Emotional sensemaking: meaning constructions of emotions about the change • Negative emotions: sad, worried, disappointment, frustration • Positive emotions: excitement, happy, joy

11. Dependent Variables Performance of change implementation • Subjective: Supervisor ratings of unit • Overall performance of implementing the change • Effort exerted at implementing the change • “Objective”: Sales performance • Change in sales after change, controlling for time of change

12. Aggregation • Unit of analyses • Sensemaking data: employee level • Performance data: unit level • Aggregation tests • Too much variability within units around sensemaking of change • Examine individuals’ sensemaking as predictive of their group score vs. average sensemaking • Group analysis • Good apple, bad apple in the barrel approach • Take the minimum and maximum values for each sensemaking variable for each unit

13. Individual Level Results * p<.05; **p<.01

14. Individual Level Results * p<.05; **p<.01

15. Aggregate Min Model Results T p<.10; * p<.05; **p<.01

16. Aggregate Min Model Results T p<.10; * p<.05; **p<.01

17. Aggregate Max Model Results T p<.10; * p<.05; **p<.01

18. Summary of Findings • Employees’ sensemaking based on emotions influences supervisor ratings of change, but has no impact on sales performance. • Employees’ sensemaking based on cognitions predicts sales performance but has no impact on supervisor ratings. • More positive emotions and less negative emotions might get unit accolades (or store manager promoted), but does not affect “objective” unit performance. • Group level: one bad apple spoils barrel; but one good apple can lead to higher subjective ratings.

19. Theoretical Implications • Linked employee-level sensemaking to unit performance • How employees make meaning of a change impacts performance • The way managers’ subjectively make meaning of change performance not consistent with “objective” performance • Resistance story—too much attention (Ford et al. 2008) • Danger of subjective performance indicators hat dominate change research • The importance (or lack thereof) of constructing positive meaning about one’s work on objective performance

20. Discussion • What resonates most with you? • How should I develop the subjective/objective story? • Should I frame paper around this finding? • Most of mechanisms theorized at individual level; ideas for unit level theorizing. • Because of lack of ability to aggregate, have both individual and unit level (min and max) results. • Build a multi-level theory? • Aggregation problems

21. Other Ways I Can Use Your Help • For “average model”, I use disaggregated results (ICC does not support aggregation) • Main findings about emotions at group-level • Main findings about cognitions at individual-level • This does not seem elegant • Any ideas?