Chapter 16 Organizational Change Essentials of Organizational Behavior, 10/e Stephen P. Robbins & Timothy A. Judge Chapter 16 Organizational Change

After studying this chapter, you should be able to: Identify forces that act as stimulants to change. List the sources for resistance to change. Compare the three main approaches to managing organizational change. Describe the causes and consequences of work stress. Describe characteristics of a learning organization. Explain global differences in organizational change and stress.

Forces that Stimulate Change

Sources of Resistance to Change People tend to resist change, even in the face of evidence of its benefits. Individual Organizational Habit Security Economic Factors Fear of the Unknown Selective Information Processing Structural Inertia Limited Focus of Change Group Inertia Threat to Expertise Threat to Established Power Relationships and Resource Allocations

Change Agents Persons in organization responsible for managing change activities Can be managers or non-managers, current employees, newly hired employees or outside consultants Outside consultants can provide objective perspectives, but don’t have to live with the consequences of change

Overcoming Resistance to Change Education and Communication Participation Building Support and Commitment Implementing Changes Fairly Cooptation Selecting People who Accept Change Coercion

Approaches to Managing Organizational Change Lewin’s Three-Step Model of Change Kotter’s Eight-Step Model of the Change Process Organizational Development

Lewin’s Three-Step Model Unfreezing can be achieved by: Increase driving forces that direct behavior away from the status quo Decrease restraining forces that hinder movement from the existing equilibrium Combine the two above approaches

Kotter’s Eight-Step Plan Create urgency Form coalition Create new vision Communicate the vision Empower others Reward “wins” Consolidate improvements Reinforce the change Movement Refreezing Unfreezing

Organizational Development A collection of planned-change interventions that seek to improve organizational effectiveness and employee well-being Based on humanistic-democratic values: Respect for People Trust and Support Power Equalization Confrontation Participation

OD Interventions Sensitivity Training Survey Feedback Changing behavior through unstructured group interaction Survey Feedback Gathering data and acting on it Process Consultation Using outside consultants Appreciative Inquiry Discovering what the organization does right

Creating a Culture for Change Innovation: a new idea applied to initiating or improving a product, process, or service Sources: Structural – verbose organic structures with slack resources and long-term managers Cultural – encourage experimentation, reward success and failure, and celebrate mistakes Human Resources – actively promote training and development, have high job security, use idea champions

Idea Champions Managers who actively and enthusiastically promote an idea, build support, overcome resistance, and ensure that innovation is implemented Have high self-confidence, persistence, energy, and acceptance of risk Use inspiration and vision to gain commitment Have decision-making discretion

Contemporary Issues Technology in the Workplace Work Stress Creating Learning Organizations

Technology in the Workplace Continuous Improvement Process Goal is constant reduction in variability Uniformity results in lower costs, higher quality, and increased stress Process Reengineering How you would do things if you could start over from scratch Very stressful for everyone

Work Stress Dynamic condition in which an individual is confronted with an opportunity, constraint, or demand related to what is desired and for which the outcome is perceived to be both uncertain and important Types: Challenge Stress – may improve performance Hindrance Stress – comes from obstacles to achieving goals – mostly negative

Managing Stress Organizational Personal Employee Selection Organizational Communication Goal-setting Programs Job Redesign Counseling Time Management Physical Activity Managers have no direct control on personal stress and there are ethical considerations about intruding into employees’ personal lives

Creating a Learning Organization An idealized organization that has developed the continuous capacity to adapt and change Types of Learning: Single-Loop: error correction process relies on past routines and present policies Double-Loop: errors are corrected in ways that involve the modification of the organization’s objectives, policies and standard routines – used by learning organizations

Five Basic Characteristics of a Learning Organization People in a learning organization: Are willing to put aside their old ways of thinking Learn to be open with each other Understand how the organization really works Can form a plan or vision that everyone agrees on Can work together to achieve that vision

Learning Organizations Solves the three fundamental problems of traditional organizations: Fragmentation – functional silos Competition – overemphasis undermines collaboration Reactiveness – ”firefighting” Managing Learning: Establish a strategy Redesign the organization’s structure Reshape the organization’s culture

Global Implications Is managing change culture bound? Do people believe change is possible? Yes, when people believe they control their environment If it’s possible, how long will it take to bring about? Short-term focus cultures want fast results Is resistance to change greater in some cultures than in others? Yes, traditional cultures resist change

Global Implications Continued Does culture influence how change efforts will be implemented? Yes, high power distance cultures are autocratic Do successful idea champions do things differently in different cultures? Yes, idea champions modified techniques based on culture Does stress vary across cultures? The conditions that lead to stress may vary, but the personality effects, outcomes, and reduction methods do not

Implications for Managers The need for change encompasses almost aspects of OB The real world is turbulent, requiring organizations and their members to undergo dynamic change if they are to perform at competitive levels Managers must continually act as change agents

Keep in Mind… Organizations and their members tend to resist change It is unlikely that anyone approach to managing change we best in every situation Changes often stressful, but not all stress is harmful

Summary Identified forces that act as stimulants to change. Listed the sources for resistance to change. Compared the three main approaches to managing organizational change. Described the causes and consequences of work stress. Described characteristics of a learning organization. Explained global differences in organizational change and stress.

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