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Managing Change

Managing Change. Lecture 1 The Change Environment. Lecture Outline. Introduction Change Forces Factors/drivers for Change Change and Its Types Organizations in Change. INTRODUCTION. Managing change has become an increasingly important task for all managers

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Managing Change

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  1. Managing Change Lecture 1 The Change Environment

  2. Lecture Outline • Introduction • Change Forces • Factors/drivers for Change • Change and Its Types • Organizations in Change.

  3. INTRODUCTION • Managing change has become an increasingly important task for all managers • Today’s organizations need to continuously adapt to new situations if they are to survive and prosper • Pressure to change comes from: • External, environmental pressures • Internal, organizational pressures

  4. 0 Organizational Change • The adoption of a new idea of behavior by an organization (Daft, 2008). • Any alterations in the people, structure, or technology of an organization (Robbins & Coulter, 2007) • A product change is a change in the organization’s product or service outputs. • A technology change is a change in the organization’s production process – how the organization does its work.

  5. CHANGE FORCES External forces Market Government Technology Economy Labour Internal forces Work force New equipment Strategy Employee attitudes

  6. Why Organizations Change? • Some Examples: • Timex – Failed to understand the market change “hand dialed watches to automatic quartz watches” • Kodak – Able to change to from film roles to digital cameras • Any more examples?

  7. Why Organizations Change? • To change an organization, step away from the edifice in which we stand in awe, and step closer to those who make it move through their daily actions (Peter de Jager, 2004) • Change is a constant feature of organizational life and the ability to manage it is seen as a core competence of successful organizations (Burnes, 2004).

  8. Kurt Lewin’s 3 Phases of Change • Present – A system of equilibrium • Transition – A period of uncertainty, movement, departure • Desired – The final, arrival point.

  9. DRIVERS OF CHANGE Strong support from CEO Incentive program Help from vendors Customer demands Legislative sanctions Pressure from Competitors Porter’s Competitive Forces – Threat of new entry, Intensity of rivalry, Substitute products, Barganing powers of buyers and suppliers RESISTORS OF CHANGE Mistrust amongst mgrs. & employees ‘Worn out’ by constant change Staff reluctance to use new technology Union resistance Poor communication channels Low resources

  10. 0 Example: Changing Traditional to Just-In-Time Inventory Systems Exhibit 11.7 Source: Daft, 2008

  11. External Drivers for Change PESTLE Analysis • Political • Economic • Social • Technological • Legal • Environmental

  12. Internal Drivers for Change • Owners & shareholders • Employees • Customers • Suppliers • The local community • Job design & skill requirement • Product design • Technology

  13. CHANGE AND ITS TYPES • Reactive (top-down) & proactive (bottoms-up) change • Plannedand Spontaneous (Emergent) change • Episodic (Infrequent, discontinuous and intentional) versus Continuous change (Ongoing, evolving & cumulative) • Discontinuous versus incremental change

  14. Robbin & Finlay’s (1997) 4 Styles of Change • Pummel – top-down change - change is enforced • Push – fear is used to stimulate action • Pull – empowers workers to improve the current situation • Pamper – style is symbolized by a lack of control

  15. Tom Peter’s Circle of Innovation • Advocates a ‘slash and burn’ approach to change – in which existing systems are destroyed in oredr to let new and more productive systems thrive.

  16. ACKERMAN’S (1997) 3 TYPES OF CHANGE • Developmental – Either planned or emergent or incremental – change that enhances or corrects existing aspects of an organization. • Transitional – seeks to achieve a known desired state – episodic, planned or radical • Transformational – Radical and differs significantly in terms of structure, process, culture & strategy

  17. Three Categories of Change Source:Robbins, S.P. and Coulter, M. (2007). Management, 9th Edition. Prentice-Hall, USA.

  18. ORGANIZATIONS IN CHANGE Strategies to Facilitate Change • Empirical-Rational – people are rational and will follow their interest once revealed • Normative-Reeducative – Adhere to cultural norms and value • Power-coercive – basically compliant and do what is told to be done – authority • Environmental – Adaptive – adapt readily to new circumstances

  19. ORGANIZATIONS IN CHANGE • Quality Circles – employee participation method • Total Quality Management • Business Reengineering • Customer oriented and radical improvement • Delayering • The learning organization • Customer focus • Empowerment

  20. References • Daft, R.L. (2008). The New Era of Management, 2nd Edition. Thomson South-Western, Ohio. • Robbins, S.P. and Coulter, M. (2007). Management, 9th Edition. Prentice-Hall, USA.

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