Chapter 2 Images of Managing Change

Learning Objectives  Understand the importance of organizational images and mental models. Identify different images of managing and of change outcomes. Outline six different images of managing change. Identify the theoretical underpinnings of these six change management images. Understand the practical implications of the six images and how to use them.

Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Controlling… Top-down view of management Fayol’s theory of management: planning, organizing, commanding, coordinating and controlling. Shaping… Participative style of management Improving the capabilities of people within the organization

Images of Change Outcomes Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Intended Change: Change is a result of planned action Partially Intended Change: Change may need to be re-modified after it is initially implemented Unintended Change: Forces beyond the control of the change manager

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Images of Managing Controlling . . . (activities) Shaping . . . (capabilities) Images of Change Outcomes Intended DIRECTOR COACH Partially NAVIGATOR INTERPRETER Unintended CARETAKER NURTURER

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Director Based on an image of management as control and of change outcomes as being achievable. Supported by the n-step models and contingency theory. Coach Relies upon building in the right set of values, skills and “drills” that are deemed to be the best ones to be drawn upon in order to achieve desired organizational outcomes. Related to OD approaches.

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Navigator Control is the heart of management action, although a variety of external factors mean that managers may achieve some intended change outcomes and others will occur over which they have little control. Supported by the contextualist and processual theories of change. Interpreter The manager creates meaning for other organizational members, helping them to make sense of various organizational events and actions. Supported by the sense-making theory of organizational change

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images Caretaker The manager’s control is severely impeded by a variety of internal and external forces beyond their scope. The caretaker shepherds their organizations along as best they can. Supported by life-cycle, population-ecology and institutional theories. Nurturer Even small changes may have a large impact on organizations and managers are not able to control the outcome of these changes but may nurture their organizations. This facilitates organizational qualities that enable positive self-organizing to occur. Related to chaos and Confucian/ Taoist theories.

Three Core Uses of the Images Images of Managing Change Images of Change Outcomes Images of Change Managers: Director Coach Navigator Interpreter Caretaker Nurturer Three Core Uses of the Images These six images of change managers have three core uses: They highlight a variety of assumptions that change managers make about change and increase the awareness of different interpretations of change. They draw attention to the dominant images of change within an organization. They highlight a range of perspectives available to change managers.

Chapter Reflections for the Practicing Change Manager Table 2.5 Chapter Reflections for the Practicing Change Manager

Chapter 3 Why Organizations Change

Why Change? Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper- competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Change is a risky activity – many organizational changes fail or do not realize their intended outcomes. This raises the question: why is change so prevalent? Pressure to change comes from: External, environmental pressures Internal, organizational pressures

Environmental Pressures Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper- competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Pressure Examples Description Fashion pressures Boeing Co. Neo-institutionalism: mimetic isomorphism. Managers imitate practices associated with successful organizations Mandated Chevron Texaco Neo-institutionalism: coercive isomorphism. An organization changes through formally or informally mandated requirements. Geopolitical pressures 3M Macroeconomic changes (or crises) place pressure on organizations to change the way they operate.

Environmental Pressures Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper- competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Pressure Examples Description Market decline pressures AOL Time Warner When current markets begin to decline there is pressure to find newer, more viable markets. Hyper-competition pressures Gateway The highly intensified rate of business – including shortened product life cycles and rapid responses by competitors – produces pressure for change at the organizational level. Reputation and credibility pressures Walt Disney Company In light of recent corporate governance scandals, the pressure to maintain a good reputation and high level of credibility has increased.

Debate: Role of the Environment Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper-competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Organizational learning vs. threat-rigidity whether external pressures facilitate or inhibit the process of change. Environment as an objective entity vs. environment as a cognitive construction The former treats the environment as an objective entity to which managers must respond. The latter emphasizes the centrality of managers’ interpretations of environmental conditions as the key determinant of behavior. Forces for change vs. forces for stability: External forces can vary; they either promote change or promote stability. Bridging (adapting) vs buffering (shielding): These represent either strategies that can maintain effectiveness by adapting parts of the organization to changes happening in the outside environment (bridging) or focusing on efficiency by avoiding change through shielding parts of it from the effects of the environment (buffering).

Integration and collaboration pressures Internal Pressures Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper-competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Pressure Examples Description Growth pressures Microsoft Existing systems and processes in an organization may no longer be applicable when the size of the organization increases. Integration and collaboration pressures EDS Integration and creating economies of scale can lead to pressure for change in organizations. Identity pressures Forte Hotel A common organizational identity and the unified commitment of staff in different areas/departments of an organization can be difficult to manage and may encourage change.

Power and political pressures Internal Pressures Why Change? External Pressures Fashion Mandated Geopolitical Market decline Hyper-competition Reputation & credibility Role of the Environment Internal Pressures Growth Integration & collaboration Identity New broom Power & political Pressure Examples Description New broom pressures Bank of America Change at the senior management level – particularly of CEO - can often be a catalyst for significant changes in an organization. Power and political pressures Morgan Stanley Power relationships and politicking can change internal processes and decision making.

Public Change Rationales Exercise 3.2 Public Change Rationales

More on the why of change…

Theories of Organizational Change Life cycle theories: linear and irreversible sequence of prescribed change Organizations go through different stages: birth, youth, midlife, maturity,…. When reached maturity, revitalization is needed. Teleological theories: recurrent and discontinuous sequence of goal setting, implementation, and adaptation Dialectic theories: recurrent and discontinuous sequence of confrontation, conflict, and synthesis Evolutionary theories: recurrent, cumulative and probabilistic sequence of variation, selection, and retention

Economic Pressures globalization: Deregulation, opening of national economies Unpredictable and Rapidly changing markets Service and knowledge base business profitability based on machine power to profitability based on intelligence and skills

Social Pressures Flexible working arrangements Women in management Educated workforce/society Demographics Immigrations People more independent, questioning Lack of loyalty between the workers and companies

Technological Pressures Information and Communication Technology High performance work systems Integrated information systems Access to information Global networking New media Shortening product life cycles High quality

Sustainable Development Pressures SD Elements: Social Employee Well-Being Quality of Life Business Ethics Economic Shareholder Value Creation Economic Development Environmental Environmental Impact Minimization Natural Resource Protection

Organizational Self-renewal Challenging old assumptions Understanding the new rules of competition Capturing the potential of new paradigms by rethinking business processes Constant innovation Improving continually as part of normal functioning Transforming while keeping purpose and direction Continuous learning

Organic type of organizations, adopted to unstable conditions continual new and unfamiliar problems cannot be broken down and distributed among the existing specialists roles continual adjustment and redefinition of individual tasks is needed Interactions and communication may occur at any level as required by the process organization charts are not always useful

Emerging Mindset Industrial mindset: emerging mindset: Invalidity of the internal reality of human consciousness Scarcity of resources Separate parts Discrete events emerging mindset: Consciousness is causative Abundance Relationships and Wholeness Continuous Process parts are connected and they are connected to the whole, change is a continuous process, and the internal and external dynamics are both important.