Change Management

Many things cause organisational change Can you think of reasons why organisations change?

Reasons for change Challenges of growth, especially global markets Challenge of economic downturns and tougher trading conditions Changes in strategy Technological changes Competitive pressures, including mergers and acquisitions Customer pressure, particularly shifting markets To learn new organisation behaviour and skills Government legislation/initiatives.

Why change? All organisations are in flux: changing their focuses, expanding or contracting their activities and rethinking their products and services. Most organisations more than ten years old look nothing like they did even five years ago. And it is likely that in the next year or two organisations will not look as they do today.

In this context managers have to be able to introduce and manage change to ensure the organisational objectives of change are met, and they have to ensure that they gain the commitment of their people, both during and after implementation. Often, at the same time, they also have to ensure that business continues as usual.

Why does change matter? Change management matters because, although change is taking place at an ever-increasing pace, there is evidence that suggests that most change initiatives fail. For example, CIPD research suggests that less than 60% of re-organisations met their stated objectives which are usually bottom line improvement.

The Impact The impact of failures to introduce effective change can also be high: loss of market position removal of senior management loss of stakeholder credibility loss of key employees

Organisational issues A change that considers a new structure but fails to establish the need to introduce new systems to support such a structure is less likely to succeed Lack of effective project management and programme management disciplines can lead to slippages in timings, in achievement of desired outcomes and in ensuring that the projects do deliver as planned Insufficient relevant training, for example in project management, change management skills and leadership skills can impact negatively on the effectiveness of any change initiative

Poor communication has been linked to issues surrounding the effectiveness of change management in achieving effective change in various ways. For example, imposed change can lead to greater employee resistance Lack of effective leadership has been identified as an inhibitor of effective change

Individual/group resistance to change Resistance to change can be defined as an individual or group engaging in acts to block or disrupt an attempt to introduce change. Resistance itself can take many different forms from subtle undermining of change initiatives or withholding of information to active resistance, for instance, through strikes.

Two broad types of resistance can be considered: Resistance to the content of change - for example to a specific change in technology or to the introduction of a particular reward system. Resistance to the process of change. This concerns the way a change is introduced rather than the object of change per se, for example, management re-structure jobs without prior consultation of affected employees.

Suggested reasons for resistance include: loss of control shock of the new uncertainty inconvenience threat to status and competence fears It is important to try to diagnose the cause of employee resistance as this will help determine the focus of effort in trying to reduce/remove the issue.

Making change management more effective Effective leadership is a key enabler as it provides the vision and the rationale for change. Different styles of leadership have been identified, for example coercive, directive, consultative and collaborative. These different styles may each be appropriate depending on the type and scale of change being undertaken.

HR’s role in Change Mgt Involvement at the initial stage in the project team  Advising project leaders in skills available within the organisation – identifying any skills gaps, training needs, new posts, new working practices Balancing out the narrow/short-term goals with broader strategic needs.  Assessing the impact of change in one area/department/site on another part of the organisation.  Understanding stakeholder concerns to anticipate problems.  Understanding the appropriate medium of communication to reach various groups. 

Appropriate and timely training is frequently identified as key to effective change. Examples of learning and development requirements might include: project and programme management skills to ensure change initiatives are completed both on time and to budget change management skills, including communication and facilitation leadership coaching

Kurt Lewin’s model of change One of the cornerstone models for understanding organisational change was developed by Kurt Lewin back in the 1950’s, and still holds true today His model is known as: Unfreeze - Change - Refreeze

What is it? Lewin, a physicist as well as a social scientist explained organisational change using the analogy of changing the shape of a block of ice: If you have a large cube of ice, but realise that you want to change it into a different shape ,what do you do? First you melt the ice to make it amenable to change (unfreeze) Then you mould the iced water into the shape you want (change) Finally you must solidify the new shape (refreeze)

Unfreeze Prepare the organisation to accept that change is necessary. This involves breaking down the status quo before you can build up a new way of operating You need to show why the existing way of doing things cannot continue e.g. declining sales figures, worrying customer satisfaction surveys You need to start at the core – you need to challenge beliefs, values, attitudes and behaviours that currently define it (foundations of the building) This stage is the most difficult and stressful

Change After the uncertainty created in the unfreeze stage, the change stage is where people begin to resolve their uncertainty and look for new ways to do things. People start to believe in and act in ways that support the new direction. In order to accept the change and contribute to making the change successful people need to understand how the changes will benefit them. Not everyone will fall in line just because the change is necessary and will benefit the company Time and Communication are key

Refreeze When the changes are taking shape and people have embraced the new ways of working, the organisation is ready to refreeze The refreeze stage helps people and the organisation internalise the changes. This means making sure that the changes are used all the time; and that they are incorporated into everyday business With a new sense of stability, employees feel confident and comfortable with the new ways of working This stage is important, without it employees may not be sure how things should be done, so nothing gets done to full capacity

HR’s role in Change Mgt Involvement at the initial stage in the project team  Advising project leaders in skills available within the organisation – identifying any skills gaps, training needs, new posts, new working practices Balancing out the narrow/short-term goals with broader strategic needs.  Assessing the impact of change in one area/department/site on another part of the organisation  Understanding stakeholder concerns to anticipate problems  Understanding the appropriate medium of communication to reach various groups 

Appropriate and timely training is frequently identified as key to effective change. Examples of learning and development requirements might include: project and programme management skills to ensure change initiatives are completed both on time and to budget change management skills, including communication and facilitation leadership coaching

Other theories of change Kotter’s Change Model Bridge’s Transition model Burke-Litwin’s model Kubler - Ross and Change Curve McKinsey 7S