Organisational Change

1. Organisational Change Chapter 6 Leading Change

2. Introduction • Leadership is a familiar topic, and you may remember some concepts that you have studied on previous courses such as Managing Behaviour at Work • The chapter focuses on a particular application of. leadership which is the leadership of change. • Leaders influence, and exert influence through, the informal subsystems of organisations. • Inevitably, some material in the chapter re-iterates some familiar theoretical concepts. • Ask yourself, ‘What are the implications for change?’

3. Objectives (1) To: • identify those characteristics which distinguish leadership from management; • discuss whether there is ‘one best way’ of leading or whether leadership style and behaviour should vary according to the circumstances; • explain the possible relationship between organisational life-cycle theories and different leadership styles and behaviours;

4. Objectives (2) To: • assess the compatibility of different leadership approaches with different types of change situations; • discuss the issue of resistance to change in terms of its implications for leading the processes of planning and implementing change.

5. Management and Leadership LEADING • Inter-personal roles • Figurehead (rep., symbol) • Leader (relational, motivator) • Liaison (network-related) • Informational roles • Monitor (scanning) • Disseminator • Spokesperson • Decisional roles • Entrepreneur (innovator) • Disturbance handler (conflict resolution) • Resource allocator • Negotiator ADMINISTRATING FIXING Source: Mintzberg, H. (1973), The Nature of Managerial Work, Harper & Row.

6. Management and Leadership Can someone be a manager but not a leader? Can someone be a leader but not a manager?

7. Management Management: • takes place within a structured organisational setting and with prescribed roles; • is directed towards the attainment of aims and objectives; • is achieved through the efforts of other people; and... • uses formal systems and procedures. Source: Mullins, L. Management and Organisational Behaviour, 5th edn., London, Financial Times, Prentice Hall Publishing. p.166.

8. Leadership • A leader shapes and shares a vision which gives pointers and direction to the work of others. • Leadership involves unleashing energy, freeing, growing, and building. • Leaders influence the direction of a group through: • structuring (framing) the situation. • controlling group behaviour. • personifying the group. • helping the group achieve its goal and potential. • Leaders need willing co-operation of the followers. Source: Coleman, J.C. (1969) quoted in Smith M. (1991) Analysing Organisational Behaviour,

9. Kotter on Management, Leadership

10. Approaches to Theorising Leadership Two main approaches “One best way” Contingency

11. “One best way” - traits of leadership (i) • Intelligence * • Having an extrovert personality • Dominance * • Masculinity • Conservatism (Lord, De Vader & Allier, 1986)

12. “One best way” - traits of leadership (ii) • Drive * (achievement, ambition, energy, tenacity, initiative) • Leadership motivation (personalised or socialised) • Honesty and integrity • Self-confidence * (including emotional stability) • Cognitive ability (the ability to marshal and interpret a wide variety of information) • Knowledge of the business (Kirkpatrick & Locke, 1991)

13. “One best way” - traits of leadership (iii) • Risk-taking * • Assertiveness and decisiveness • Achievement orientation • Motivation • Competitiveness (Dulewicz and Herbert 1996)

14. “One best way” - traits of leadership (iv) Leadership traits relating in some ways to risk taking include: • ability to cope with change and uncertainty • creative thinking • drawing on intuition, • right brain thinking • good use of tacit knowledge • the‘intuitive-thinking’type • ‘arts-based thinking’ • imagination • able to handle ‘messes’ or ‘soft problems’

15. “One best way” - traits of leadership (v) Components of emotional intelligence • self awareness • self-regulation • motivation • empathy • social skills (Goleman, 1998) Attributes of hero leaders, change masters • ‘Kaleidoscope thinking’ • Imagination • Foresight

16. A Bad Way - unethical leadership • Narcissistic • Controlling • Manipulative • Self-promoting

17. “One Best Way” ? - leader behaviour Wright (1996) found that leader styles are typically a blend of the following 4 components. Is there an optimal mix? • Concern for task (production-centred) • Concern for people (person -centred) • Directive leadership (autocratic) • Participative leadership (democratic)

18. University of Michigan Studies This style seemed to work best

19. The Managerial Grid Country ClubManagement Team Management Organisation Man Management 9,9 style is often best Impoverished Management Authority-Obedience

20. “One-best-way” - transformational leaders Transformational Leaders • Make major changes to • organisational mission • organisational structure • political and cultural systems of the organisation (Source: Bass, B.M. (1990) From transactional to transformational leadership: learning the vision. Organizational Dynamics, Winter, p.22)

21. “One-best-way” - transactional & ‘transformational leaders Transactional Leader • Management by exception (active) • Contingent reward • Management by exception (passive) • Laissez-faire Transformational Leader • Charisma • Inspiration • Intellectual stimulation • Individualised consideration (Source: Bass, B.M. (1990) From transactional to transformational leadership: learning the vision. Organizational Dynamics, Winter, p.22)

22. Transformational Leadership Current state of expected subordinate effort Heightened motivation to attain designed outcome (extra effort) Transactional Leadership Normal expected subordinate performance Subordinate performance beyond normal expectations

23. “One-best-way” - A third dimension of leadership behaviour For a changing world Andrea Jung, CEO of Avon Cosmetics

24. Contingency theories These take account of the great variety of situational influences on leader effectiveness • Tannenbaum and Schmidt • Fiedler • Hersey and Blanchard • Path-goal • Quinn

25. Contingency Theory 1:Tannenbaum and Schmidt • A continuum from ‘boss centred’ to ‘subordinate centred’ • Appropriate position on the continuum depends on • Forces in the manager • Forces in the subordinate • Forces in the situation • Nature of task/problem • Organisational context

26. Jayne has little room to manoeuvre Directive Participative style of style of leadership leadership Jayne’s preferences Jayne’s room for manoeuvre Subordinates’ preferences Task stucture Context

27. 2. Fiedler’s contingency theory of leadership Fiedler believes leaders must be chosen to fit the situation

28. Contingency Theory 3: Hersey & Blanchard’s Situational Leadership Follower readiness: ability and willingness Leader: decreasing need for support and supervision

29. Situational Leadership (cont.) (Hersey and Blanchard) • Two Orientations • task behavior • relationship behavior • Four Styles • tell • sell • participate • delegate

30. Situational Leadership (cont.) (Hersey and Blanchard) • Two Follower Readiness factors • ability (job knowledge, experience, and skills) • willingness (psychological readiness- confidence, commitment, and motivation) • Four Levels of Follower Readiness • unable, unwilling • unable, willing • able, unwilling • able and willing

31. Situational Leadership (cont.) Effect of (Follower Readiness: Willingness and Ability) Hi Delegating Participating Subordinates’ Willingness Telling Selling Lo Hi Subordinates’ Ability

32. Contingency Theory 4: Path-Goal Theory

33. Path-Goal: factors between effort & results TEAM MEMBER CHARACTERISTICS Expectations that effort will bring desired rewards) locus of control skill motivation PERFORMANCE EFFORT job design goal clarity resources (tools, materials, information etc.) time NATURE OF TASK AND CONTEXT

34. Path-Goal Leadership Styles 1. Directive • Clarifies job duties, clarifies performance standards, ensures that procedures are followed • Same as task-oriented leadership 2. Supportive • Friendly, approachable, shows concern, respect • Same as people-oriented leadership 3. Participative • Consults with employees, solicits suggestions • Related to employee involvement practices 4. Achievement-oriented • Sets challenging goals, high confidence in employees, expects improvement • Applies goal setting, positive self-fulfilling prophecy

35. Skill/Experience lowlowhigh high Locus of Control externalexternalinternal internal Employee Contingencies Directive Supportive Participative Achievement Path-Goal Contingencies (summary) Environmental Contingencies DirectiveSupportive Participative Achievement Task Structure ambiguousroutine non-routine ambiguous Team Dynamicsneg. normslow cohesionpos. norms ?

36. Contingency Theory 5: Quinn’s Competing Values The basic idea is that leadership styles should fit the overall organisational model. The organisational models are: • The team: flexible but inward looking. • Leader is a supporter, facilitator. • The adhocracy: flexible and outward looking. • Leader is an innovator, broker. • The firm: stable but outward looking. • Leader is task oriented, directive. • The hierarchy: stable and inward looking. • Leader is a monitor, co-ordinator.

37. Leadership in times of change • Leadership and the organisational life-cycle. (Greiner, 1972; Clarke & Pratt, 1985). • Leadership and the nature of change. (Dunphy & Stace, 1993). • Leadership and resistance to change. (Clarke, 1994). • Analysing and managing resistance to change. (Strebel, 1996; Beer, Eisenstat & Spector, 1990; Kotter, 1995).

38. Can one leader take the organisation through all its phases? • Styles will likely need to change as the organisation develops through the various phases. • Some contingency theorists would say that it is theoretically possible for one leader to take the organisation through various phases.. • Others (e.g. Fiedler) would say it is not possible.

39. Leadership and the OrganisationalLife Cycle (i) : Greiner, Clarke .

40. Leadership and the OrganisationalLife Cycle (ii) : Clarke & Pratt .

41. Environmental conditions & types of change - a recap of Chapter 2

42. Dunphy & Stace Change Matrix .

43. Forces for and against change Leading change will inevitably also be concerned with overcoming resistance to change • Driving forces for change • external forces (e.g. constraints from suppliers, customer needs) • internal forces (e.g. org growth, office politics, restructuring) • Driving forces against change • Individual resistance • organisational resistance

44. Resistance to Change ‘The most likely response to a change proposal is a series of outraged objections, some relevant (for no proposer of change can have thought out all the implications), some irrelevant (just waiting for an opportunity to surface and using this one).’ • (Pugh, D. (1993) Understanding and Managing Change, in Mabey C, and Mayon-White, B. (eds.) Managing change, second edition, PCP).

45. Individuals’ reactions to change + Positives Enthusiasm Opportunity Challenge Excitement New skills New knowledge Reward Fulfilment Survival New start Creates options Learning experience Motivation - Negatives Fear Anxiety Shock Distrust Anger Stress Resentment Confusion Uncertainty Demotivation Depression Loss of self-esteem Loss of identity - Negatives Loss of peer group Letting go Saying goodbye Distraction Family disruption Insomnia Conflict Politics Stubbornness Critical reactions Mutiny Disown/Block Misunderstanding

46. Reasons for Adverse Reactions to Change • Loss of job • Reduction of career prospects • Down grading of work • Effects in pay • Loss of status - “empires” • Reduction in responsibility or job interest • Need to learn new skills • New and unknown bosses • New and known (!) bosses • Break up of established work groups • Transfer to new, unknown (known!) locations or departments

47. Underlying Reasons Why Individuals Resist Change Perceived lack of new skills, loss of old Loss of power base Dislike of uncertainty ambiguity Fear of the Unknown Loss of rewards

48. How People Resist Change Individual responses to threats and unknown dangers • rigidity • doing more of the same but harder • greater inadequacy • aggression • aggressive rigidity

49. Sources of Organisational Resistance Group Norm Inertia Threat to Existing Group Power Bases Structural ‘Built-in’ Inertia Threat to Existing Resource Allocations Cultural, mindset inertia Entrenched interests

50. Why Organisations Resist Change Organisations are coalitions of interest groups in tension • balance (ultra-stability, equilibrium) of forces hammered out over a period • Change upsets this balance