Organizational Behavior (MGT-502) Lecture-38

Summary of Lecture-37

Organizational Change

Change or Disappear

Forces For Change Internal Forces External Forces Process Behavioral Economic Forces Technology Social and Political Change External Forces Internal Forces Process Behavioral Organizational Change

Types of Change Planned Unplanned Evolutionary Revolutionary 6

Today’s Topics

Rate of Technological Change Change Rate 2,500,000 B.C. 1,000,000 B.C. 2,000 A.D.

Resistance To Change Individuals Organizations Habit Fear of unknown Economic threat New social relationships Dislike of change agent Dislike of implied criticism Organizations Threats to power Resource limitations Fixed investments

Driving Forces Changing technology Knowledge explosion Rapid product obsolescence Changing nature of workforce Changing values

Overcoming Resistance Coercion Resist Manipulation Negotiation Tolerate Education Participation Accept Facilitation & Support Support

Minimizing Resistance to Change Communication Minimizing Resistance to Change Coercion Training Negotiation Employee Involvement Stress Management

Managing Organizational Change

The Three C’s of Change Customers take charge Competition intensifies Change becomes constant

A continuous challenge as customer expectations change and can sometimes change faster than organizations can respond

The New World of Work Peoples’ roles change - from controlled to empowered Job preparation changes - from training to education Focus of performance measures and compensation shifts - from activities to results Advancement criteria change - from protective to productive Managers change - from supervisors to coaches Organization structures change - from hierarchical to flat Executives change - from scorekeepers to leaders

Change Can Be…. Huge, catastrophic Small, incremental Predictable Positive Productive A small modification to your life Taken in stride, managed Small, incremental Unpredictable Negative Unproductive A devastating collapse of your world Continuously stressful Ask participants for more ideas on this, based on personal/professional experience.

Some External Forces for Change Easier information transfer Facilitates global structures Requires new competencies and expectations Facilitates telecommuting; new employment relationships More emphasis on knowledge management Information Technology Globalization & Competition Demography

Some External Forces for Change Information Technology Global competition Technology makes it easier to compete quickly Results in restructuring, outsourcing, mergers produces many employment changes Globalization & Competition Demography

Some External Forces for Change Information Technology More educated workforce want involvement; interesting work Younger generation less intimidated by status want a more balanced work life Cultural changes more individualism in traditionally collectivist countries Globalization & Competition Demography

Areas Where Change Can Occur Change Technology Change the Organization’s Structure or Design Change Job Responsibilities or tasks performed Change People

Change Management Concept Model Strategy Organizational Structure Business Models/Systems Business Processes People

Change Management Success Factors People Business Processes Business Models/Systems Organizational Structure Strategy

Change Management Risk Alignment People Business Processes Business Models/Systems Organizational Structure Strategy

The Change Agent’s Role Change agent - the individual or group who undertakes the task of introducing and managing a change in an organization The change agent can be internal or external 8

The Change Agent Generators Implementers Adopters key change agents demonstrators patrons defenders Implementers external internal Adopters early adopters maintainers users

Internal Change Agents Advantages Disadvantages Better knowledge of the organization Available more quickly Lower out-of-pocket costs A “known” quantity More control & authority May be too close to the problem May be biased May be viewed a part of the problem Not available for previous job Vested interest may reduce credibility

External Change Agents Advantages Disadvantages Less knowledge of the organization Requires higher out-of-pocket costs An unknown quantity Longer start-up time Hurts management’s image More objective views More diverse experience May have more specific experience and knowledge

What Can Change Agents Change? Structure Change Agents can alter one or more of the key elements in a an organization's design. Technology Competitive factors or innovations within an industry often require change agents to introduce new equipment, tools, or operating methods. Physical Settings People Change agents help individuals and groups within the organization work more effectively together.

The Change Process Two perspectives Forces of change “Break it”- ‘Change it” - ‘Freeze it” Continuous renewal Forces of change Internal External

Organizational Change Unfreezing Changing Refreezing Lewin’s Three-Step Process

Let’s stop it here

Summary

Managing Organizational Change

The Change Agent’s Role Change agent - the individual or group who undertakes the task of introducing and managing a change in an organization The change agent can be internal or external 8

Organizational Change Unfreezing Changing Refreezing Lewin’s Three-Step Process

Next….

Organizational Behavior (MGT-502) Lecture-38