TOPIC 6 CHANGE MANAGEMENT

TOPIC 6

CHANGE MANAGEMENT

6.1 Definition of Change Management

Change simply refers to alteration in the existing conditions of an organization. One meaning of managing change refers to the making of changes in a planned and managed or systematic fashion. The aim is to more effectively implement new methods and systems in an ongoing organization. The changes to be managed lie within and are controlled by the organization.

6.2 Types of Change

There are seven types of change: incremental, transformational, strategic, organizational, systems and processes, cultural, and behavioural.

Incremental Change

Incremental change is gradual change. It takes place in small steps. At the strategic level James Quinn (1980) coined the phrase ‘logical incrementalism’ to describe how organizations develop their change strategies. He suggested that organizations go through an iterative process that leads to incremental commitments that enable the enterprise toexperiment with, and learn about, an otherwise unknowable future.

Transformational Change

Transformation, according to Webster’s Dictionary, is: ‘A change in the shape, structure, nature of something’. Transformational change is the process of ensuring that an organization can develop and implement major change programmes so that it responds strategically to new demands and continues to function effectively in the dynamic environment in which it operates. Organizational transformation may involve radical changes to the structure, culture and processes of the organization. This may be in response to competitive pressures, mergers, acquisitions, investments, disinvestments, changes in technology, product lines, markets, cost reduction exercises and decisions to downsize or outsource work. Transformational change may be forced on an organization by investors or government decisions. It may be initiated by a new chief executive and top management team with a remit to ‘turn round’ the business.

Strategic change

Strategic change is concerned with broad, long-term and organization-wide issues. It is about moving to a future state that has been defined generally in terms of strategic vision and scope. It will cover the purpose and mission of the organization, its corporate philosophy on such matters as growth, quality, innovation and values concerning people (employees and customers), and the technologies employed. This overall definition leads to specifications of competitive positioning and strategic goals for achieving competitive advantage and for product-market development. These goals are supported by policies concerning marketing, sales, customer service, product and process development, and human resource management.

Organizational change

Organizational change deals with how organizations are structured and, in broad terms, how they function. It involves identifying the need to reconsider the formal structure of organizations, which Child (1977) has defined as comprising ‘all the tangible and regularly occurring features which help to shape their members’ behaviour’. Organizational change programmesaddress issues of centralization and decentralization, how the overall management task should be divided into separate activities, how these activities should be allocated to different parts of the organization, and how they should be directed, controlled, coordinated and integrated.

Systems and Processes

Changes to systems and processes affect operations and impact on working arrangements and practices in the whole or part of an organization. They take place when operating methods are revised, new technology is introduced or existing technology is modified.

Cultural Change

Cultural change aims to change the existing culture of an organization. Organizational or corporate culture is the system of values (what is regarded as important in organizational and individual behaviour) and accepted ways of behaviour (norms) that strongly influence ‘the way things are done around here’. It is founded on well-established beliefs and assumptions.

Behavioural Change

Behavioural change involves taking steps to encourage people to be more effective by shaping or modifying the ways in which they carry out their work. Organizations depend on people behaving in ways that will contribute to high performance and support core values. They must recognize that people at work often have discretion on the way they do their work and the amount of effort, care, innovation and productive behaviour they display.

6.3 Change Process

The following are the three stages of change according to Lewin’s Change Model:

Unfreezing

The focus of this stage is to make organization open to change. In doing so individuals are encouraged to replace old behaviors and attitudes with those desired by management. Managers also need to devise ways to reduce the barriers to change during this stage.

Changing

The focus of this stage is in providing employees with new information, new behavioral models, or new ways of looking at things. The purpose is to help employees learn new concepts to implement change. Role models, mentors, experts, benchmarking organization against world-class organizations and training are useful mechanisms to facilitate change.

 

Re -freezing

The focus of this stage is stabilizing the change during refreezing by helping employees integrate the changed behavior or attitude into their normal way of doing things. This is accomplished by first giving employees the chance to exhibit the new behaviors or attitudes. Once exhibited, positive reinforcement is used to reinforce the desired change. Additional coaching and modelling are also used at this point to reinforce the stability of the change.

6.4 External Factors that Trigger Change in an Organization

External forces for change originate outside an organization. There are four key external forces for change:

• Demographic Characteristics: These include age, education, skill level and gender of employees. Organizations need to effectively manage these characteristics in order to receive maximum contribution and commitment from their employees.
• Technological Advancements: Both manufacturing and service organizations are increasingly using technology as a means to improve productivity and market competitiveness.
• Market Changes: The emergence of a global economy is forcing Indian organizations to change the way they do business. Organizations are entering into new partnerships with their suppliers in order to deliver higher quality products at lower prices.
• Social and Political Pressures: These forces are created by social and political events. Personal values affect employee’s needs, priorities and motivation. Therefore, managers need to adjust their managerial style according to the changing employee values. Political events also create substantial change in an organization. Although it is difficult for organizations to predict changes in political forces, many organizations hire lobbyists and consultants to help them detect and respond to social and political changes.

6.5 Internal Factors that Trigger Change in an Organization

Internal forces for change come from inside the organization. This may come from both human resource problems and managerial behavior.

• Human Resource Problems: These problems stem from employee perceptions about their work environment and conflict between an employee and organization needs. Organizations might respond to these problems by using the various approaches to job design by implementing realistic job previews and by reducing employees’ role conflict, stress, work overload and ambiguity.
• Managerial Behavior: Excessive interpersonal conflict between managers and their subordinates is a sign of implementing an immediate change. Inappropriate leader behavior such as inadequate direction and support are the cause of conflict between managers and their subordinates.
• Nature of Change: Organizations introduce changes through people. Unless the people are willing to accept the need and responsibility for organizational change, intended changes can never be translated into reality. In addition, individuals have to learn to adapt their attitudes and behavioral patterns to constantly changing environments.

6.6 Resistance to Change

Although organizations initiate changes in order to adjust to the changes in their environments but people sometimes resist them. Therefore, managers need to recognize the manifestations of resistance both in themselves and in others, if they want to be more effective in supporting change.

6.6.1 Individual Resistance

Some common reasons for individual resistance to change within organisations include the following:

• Selective perception: People’s own interpretation of stimuli presents a unique picture or image of the ‘real’ world and can result in selective perception. This can lead to a biased view of a particular situation, which fits most comfortably into a person’s own perception of reality, and can cause resistance to change.
• Habit: People tend to respond to situations in an established and accustomed manner. Habits may serve as a means of comfort and security, and as a guide for easy decision-making. Proposed changes to habits, especially if the habits are well established and require little effort, may well be resisted.
• Inconvenience or loss of freedom: If the change is seen as likely to prove inconvenient, make life more difficult, reduce freedom of action or result in increased control, there will be resistance.
• Economic implications: People are likely to resist change which is perceived as reducing either directly or indirectly their pay or other rewards, requiring an increase in work for the same level of pay or acting as a threat to their job security. People tend to have established patterns of working and a vested interest in maintaining the status quo.
• Security in the past: There is a tendency for some people to find a sense of security in the past. In times of frustration or difficulty, or when faced with new or unfamiliar ideas or methods, people may reflect on the past. There is a wish to retain old and comfortable ways.
• Fear of the unknown: Changes which confront people with the unknown tend to cause anxiety or fear. Many major changes in a work organisation present a degree of uncertainty. For instance a person may resist promotion because of uncertainty over changes in responsibilities or the increased social demands of the higher position.

6.6.2 Organisational Resistance

Some of the main reasons for organisational resistance against change are as follows:

• Organisation culture: Recall that the culture of an organisation develops over time and may not be easy to change. The pervasive nature of culture in terms of ‘how things are done around here’ also has a significant effect on organisational processes and the behaviour of staff. An ineffective culture may result in a lack of flexibility for, or acceptance of, change.
• Maintaining stability: Organisations, especially large-scale ones, pay much attention to maintaining stability and predictability. The need for formal organisation structure and the division of work, narrow definitions of assigned duties and responsibilities, established rules, procedures and methods of work, can result in resistance to change. The more mechanistic or bureaucratic the structure, the less likely it is that the organisation will be responsive to change.
• Investment in resources: Change often requires large resources which may already be committed to investments in other areas or strategies. Assets such as buildings, technology, equipment and people cannot easily be altered.
• Past contracts or agreements: Organisations enter into contracts or agreements with other parties, such as the government, other organisations, trade unions, suppliers and customers. These contracts and agreements can limit changes in behaviour – for example, organisations operating under a special licence or permit, or a fixed-price contract to supply goods/services to a government agency.
• Threats to power or influence: Change may be seen as a threat to the power or influence of certain groups within the organisation, such as their control over decisions, resources or information. For example, managers may resist the introduction of quality circles or worker-directors because they see this as increasing the role and influence of non-managerial staff, and a threat to the power in their own positions.

6.7 Overcoming Resistance to Change

The following methods of overcoming-resistance to change are as follows:

• Participation: Participation is generally considered the most effective technique for overcoming resistance to change. Employees who take part in planning and implementing change are better able to understand the reasons for the change than those who are not involved. They become committed to the change and make it work. Employees who have the opportunity to express their own ideas and to understand the perspectives of others are likely to accept change gracefully. It is a time consuming process.
• Education and Communication: Educating employees about the need for and the expected results of an impending change help reduce their resistance. Managers should maintain an open channel of communication while planning and implementing change. However, it is also a time consuming process.
• Facilitation of Change: Knowing ahead of lime that employees are likely to resist change then the manager should do as much as possible to help them cope with uncertainly and feeling of loss. Introducing change gradually, making only necessary changes, announcing changes in advance and allowing time for people to adjust to new ways of doing things can help reduce resistance.
• Force-Field Analysis: In almost any situation where a change is being planned, there are forces acting for and against the change. In force-field analysis, the manager list each set of forces and then try to remove or minimize some of the forces acting against the change.
• Negotiation: Where someone or some group will clearly lose out in a change and where that group has considerable power to resist, there negotiation is required. Sometimes it is a relatively easy way to avoid major resistance.

1. vi) Manipulation and Cooperation: This is followed when other tactics will not work or are too expensive. It can be quick and inexpensive; however, it can lead to further problems if people feel manipulated.