Managing Organizational Change

Learning Outcomes After studying this chapter, you will be able to: Define organizational change and compare and contrast views on the change process. Explain how to manage resistance to change. Describe what managers need to know about employee stress. Discuss techniques for stimulation innovation

Organizational Change 1- Defining Organizational Change

Organizational change is: “Any alteration of an organization’s people, structure, or technology”

Categories of Organizational Change What Is Organizational Change? Categories of Organizational Change

1.1 Changes in structure includes any alteration in authority relationships, coordination mechanisms, degree of centralization, job design, or similar variables. For example, restructuring can result in decentralization, wider spans of control, reduced work specialization, and work teams. Teams that cut across departmental lines allows those people who understand a problem best to rectify it.

1.2 Changes in technology can include: modifications to work processes or to the methods and equipment used. continuous improvement initiatives, which focus on developing flexible processes to support better-quality operations. employees committed to continuous improvement are constantly looking for things to fix, so work processes must be adaptable to continual change. work processes must be adaptable to continuous change and fine tuning.

This adaptability requires an extensive commitment to educating and training workers in problem solving, decision making, negotiation, statistical analysis, and team-building. Workers must also be able to analyze and act on data.

1.3 Changes in people refer to changes in employee attitudes, expectations, perceptions, or behaviors. To adapt well to change, the workforce must be committed to quality and continuous improvement, which stem from proper employee education and training, performance evaluation, and a reward system that supports and encourages those improvements. For example, putting quality goals into executives’ bonus plans and incentives for employees

2. Forces for organizational change (Why do organizations need to change) External forces Internal forces Both internal and external forces in the environment bring about the need for change.

External factors: 2.1 The Need for Change: External Factors Marketplace (Competition) Government laws and regulations Technology Fluctuations in labor markets Economic changes

2.2 The Need for Change: Internal Forces Redefined or modified organizational strategy Composition of workforce Employee attitudes

Who initiates organizational change? 3- Initiating Change Who initiates organizational change? Change Agents People who act as catalysts and assume the responsibility for managing the change process. A change agent can be a manager, internal staff specialist, or outside consultant with expertise in change implementation.

How does the organizational change happen? 4- The Change Process How does the organizational change happen? Two metaphors are used to illustrate the change process: 1- The “calm waters” metaphor 2- The “White-water rapids” metaphor These two metaphors represent distinctly different approaches to understanding and responding to change

4.1 The “Calm Waters” metaphor 4- The Change Process 4.1 The “Calm Waters” metaphor The “calm waters” metaphor envisions the organization as a large ship crossing a calm sea. Change appears as the occasional storm, a brief distraction in an otherwise calm and predictable trip

4.1 The “Calm Waters” metaphor Until recently, the “calm waters” metaphor dominated the thinking of practicing managers and academics. The prevailing model for handling change in such circumstances is best illustrated in Kurt Lewin’s three-step description of the change process

Kurt Lewin’s three-step Model “Calm Waters” Change Kurt Lewin’s three-step Model

4.2 The “White-water rapids” metaphor 4.2 “White-Water Rapids” Change 4.2 The “White-water rapids” metaphor The organization is seen as a small raft navigating a raging river with uninterrupted white-water rapids. Aboard the raft are half a dozen people who have never worked together before, who are totally unfamiliar with the river, and who are unsure of their eventual destination. In this metaphor, change is the status quo and managing change is a continual process.

4.2 “White-Water Rapids” Change

4.2 “White-Water Rapids” Change Not every manager faces such a world but the number who do is increasing. Disruptions in the status quo are no longer occasional and temporary, and they are not followed by a return to calm waters. Many managers never get out of the rapids and face constant forces in the external and internal environment that bring about the need for organizational change.

5- Implementing Change Organization development – Are concerted efforts that assist organizational members with a planned change. These efforts can help employees to be more adaptive and effective in achieving the new goals of the organization.

5- Implementing Change Organizational development tactics: Survey feedback Process consultation Team-building Intergroup development

Survey feedback Employees generally respond to a set of specific questions regarding how they view such organizational aspects as decision making, leadership, communication effectiveness, and satisfaction with their jobs, coworkers, and management. This data is used to clarify problems that employees may be facing and to initiate action to remedy the problems.

Process consultation Outside consultants help managers to perceive, understand, and act on organizational processes they face, such as workflow, informal relationships among unit members, and formal communication channels. Consultants give managers insight into what is going on and help managers diagnose the interpersonal processes that need improvement.

Team-building is generally an activity that helps work groups set goals, develop positive interpersonal relationships, and clarify the roles and responsibilities of each team member. The primary focus of team-building is to increase members’ trust of and openness toward one another.

Intergroup development focuses on helping different work groups to become more cohesive. It attempts to change attitudes, stereotypes, and perceptions that one group may have toward another in order to improve coordination of efforts among the various groups.

6- Resistance to Change & how to manage it

Resistance to Change Fear about adaptation Habits Fear of losing something already possessed Belief that the change is incompatible with the goals and interests of the organization

Reducing Resistance to Change Techniques for Reducing Resistance to Change

7- What managers need to know about employee stress

For many employees, change creates stress For many employees, change creates stress. A dynamic and uncertain environment characterized by restructurings, downsizings, empowerment, and personal-life matters has caused large numbers of employees to feel overworked and “stressed out.”

7.1 Symptoms of Stress

7.2 Causes of Stress Categories of organizational stressors: Task demands Role demands Interpersonal demands Organization structure Organizational leadership

Role demands are pressures placed on an employee as a function of the particular role he or she plays in the organization. Role conflicts create expectations that may be hard to reconcile or satisfy. An employee experiences role overload when he or she is expected to do more than time permits. An employee experiences role ambiguity when role expectations are not clearly understood and the employee is not sure what he or she is supposed to do.

Reducing Stress Match employee skills to job requirements Redesign jobs Offer employee assistance programs

To reduce job-related stress, managers begin with employee selection—making sure that an employee’s abilities match the job requirements. A realistic job preview during the selection process can help minimize stress by clarifying job expectations. Ongoing organizational communications keep ambiguity-induced stress to a minimum. Similarly, a performance planning program (such as MBO) states job responsibilities clearly, provides clear performance goals, and reduces ambiguity through feedback.

Job redesign can also reduce stress by increasing challenge, including employees in decision making, or reducing the workload.

Employee assistance programs is to get a productive employee back on the job as quickly as possible. Wellness programs are designed to help cut employer health costs and to lower absenteeism and turnover by preventing health-related problems.

Techniques for Stimulating Innovation

Innovation Is the process of taking a creative idea and turning it into a useful product, service, or method of operation. The innovative organization is characterized by its ability to channel creativity into useful outcomes. When managers talk about changing an organization to make it more creative, they usually mean they want to stimulate and nurture innovation.

Encouraging Innovation

Encouraging Innovation (cont.)

Culture and Innovation Innovative organizations: Encourage experimentation Reward both successes and failures Celebrate mistakes

HR aids innovation by: Promoting training and development Offering high job security Encouraging individuals to become idea champions Supporting new ideas Overcoming resistance Implementing innovations