Chapter 8 Managing Change and Innovation Organizational change Organization development Stress: The aftermath of organizational change Stimulating innovation

Organizational Change External and internal forces for change The content of organizational change and change agent Two views of the change process Member resistance to change Techniques for reducing resistance to change

External forces Marketplace Technology Economical factors Political and legal factors Social and cultural factors Internal forces Strategy adjustment The introduction of new equipment The state of workforce Employee attitude

The Content of Organizational Change Structure Authority relationships Coordinating mechanisms Job redesign Spans of control + Technology Work process Work methods Equipment People Attitudes Expectations Perceptions Behavior

Change Agent Change agent is a person who initiates and assumes the responsibility for managing a change in organization. The change agent can be a manager or nonmanager, for example, an internal staff specialist or outside consultant.

“Calm Water” Metaphor “Calm water” metaphor envisions the organization as a large ship making a predictable trip across a calm sea and experiencing an occasional storm.

Exhibit 8-1 the Change Process Unfreezing Changing Refreezing Exhibit 8-1 the Change Process

Exhibit 8-2 Unfreezing the Equilibrium State Driving forces Restraining forces Time Previous Equilibrium Optimal state Exhibit 8-2 Unfreezing the Equilibrium State

“White-Water Rapids” Metaphor “White-water rapids” metaphor describes the organization as a small raft navigating a raging river with uninterrupted white-water rapids. This metaphor takes into consideration the fact that environments are both uncertain and dynamic.

Exhibit 8-2 Why People Resist Change Individual resistance Fear of losing something of value Fear of the unknown Belief that change Is not good for the organization Exhibit 8-2 Why People Resist Change

Techniques for Reducing Resistance to Change Education and communication Participation Facilitation and support Negotiation Manipulation and cooptation Coercion

Organization development is an activity designed to facilitate planned, long-term organization-wide change that focuses on the attitudes and values of organizational members; essentially an effort to change an organization’s culture. One of the fundamental issues behind OD is to foster an environment of communication and trust.

Exhibit 8-3 Typical OD Techniques Survey feedback Sensitivity training Intergroup development Process consultation Team building More constructive human relationships in organization Exhibit 8-3 Typical OD Techniques

Stress: The Aftermath of Organizational Change What is stress? Stressors: causes of stress The symptoms of stress How can stress be reduced?

Stress is a dynamic condition in which an individual is confronted with an opportunity, constraint, or demand related to what he or she desires,and for which the outcome is perceived to be both uncertain and important.

Exhibit 8-4 Major Stressors Organizational factors Task demands Role demands Interpersonal demands Organization structure Leadership styles Personal factors Personality types Family matters Financial problems Environmental factors Economical uncertainty Political uncertainty Technology uncertainty Exhibit 8-4 Major Stressors

The Symptoms of Stress Physiological symptoms Psychological symptoms Behavioral symptoms

How can stress be reduced? Eliminate organizational stressors Employee assistance programs(EAPs) EAPs are programs offered by organizations to help their employees overcome personal and health-related problems. Wellness program Wellness programs offered by organizations to help their employees prevent health problems.

Creativity and Innovation Creativity means the ability to combine ideas in a unique way or to make unusual associations between ideas. Innovation is the process of taking a creative idea and turning into a useful product, service, or method of operation.

Three Sets of Variables to Simulate Innovation Structural variables Cultural variables Human resource variables

Structural variables Organic structures positively influence innovation. Easy availability of plentiful resources is a key building block for innovation. Frequent interunit communication helps to break down possible barriers to innovation by facilitating interaction across departmental lines.

Cultural variables Acceptance of ambiguity Tolerance of the impractical Low external controls Tolerance of risk Tolerance of conflict Focus on ends rather than on means Open systems focus

Human resource variables Promoting training and development of employees Offering employees high job security Encouraging individuals to become champions of change

Practices: What content can include organizational changes? What resistances exist in the organization during the process of the change? How should organizations and individuals deal with the negative effect of the stress? What should an innovative culture be?