1. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 1 Chapter 16 Managing Change and Innovation

2. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 2 LEARNING OUTLINE Follow this Learning Outline as you read and study this chapter. Forces for Change –Define organizational change. –Discuss the external and internal forces for change. –Contrast internal and external change agents.

3. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 3 LEARNING OUTLINE (cont’d) Follow this Learning Outline as you read and study this chapter. Two Views of the Change Process –Contrast the calm waters and white-water rapids metaphors of change. –Explain Lewin’s three-step model of the change process. –Discuss the environment that managers face today.

4. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 4 LEARNING OUTLINE (cont’d) Follow this Learning Outline as you read and study this chapter. Managing Change –Explain how managers might change structure, technology, and people. –Explain why people resist change and how resistance might be managed.

5. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 5 LEARNING OUTLINE (cont’d) Follow this Learning Outline as you read and study this chapter. Stimulating Innovation –Explain why innovation isn’t just creativity. –Explain the systems view of innovation. –Describe the structural, cultural, and human resources variables that are necessary for innovation. –Explain what idea champions are and why they’re important to innovation.

6. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 6 LEARNING OUTLINE (cont’d) Follow this Learning Outline as you read and study this chapter. Contemporary Issues in Managing Change –Explain why changing organizational culture is so difficult and how managers can do it. –Describe employee stress and how managers can help employees deal with it. –Discuss what it takes to make change happen successfully.

7. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 7 What Is Change? Organizational Change –Any alterations in the people, structure, or technology of an organization Characteristics of Change –Is constant yet varies in degree and direction –Produces uncertainty yet is not completely unpredictable –Creates both threats and opportunities Managing change is an integral part of every manager’s job

8. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 8 Forces for Change External forces –Marketplace –Governmental laws and regulations –Technology –Labour markets –Economic changes Internal Forces –Changes in organizational strategy –Workforce changes –New equipment –Employee attitudes

9. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 9 The Manager as Change Agent Change Agents –People who act as catalysts and assume the responsibility for changing process Types of Change Agents –Managers: internal entrepreneurs –Nonmanagers: change specialists –Outside consultants: change implementation experts

10. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 10 Change Process Viewpoints The Calm Waters Metaphor –Lewin: a break in the organization’s equilibrium state Unfreezing the status quo Changing to a new state Refreezing to make the change permanent White-water Rapids Metaphor –The lack of environmental stability and predictability requires that managers and organizations continually adapt (manage change actively) to survive

11. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 11 Exhibit 16.1 The Change Process UnfreezingRefreezingChanging

12. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 12 Exhibit 16.2 Three Categories of Change Work specialization, departmentalization, chain of command, span of control, centralization, formalization, job redesign, or actual structural design Technology Work processes, methods, and equipment People Attitudes, expectations, perceptions, and behaviour Structure

13. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 13 Types of Change Structural –Changing the organization’s structure or its structural components Technological –Adopting new equipment or operating methods that displace old skills and require new ones Automation: replacing certain tasks done by people with machines Computerization People –Changing attitudes, expectations, perceptions, and behaviours of the workforce.

14. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 14 Exhibit 16.3 Organizational Development Techniques MORE EFFECTIVE INTERPERSONAL WORK RELATIONSHIPS Process Consultation Survey Feedback Sensitivity Training Intergroup Development Team Building A method of changing behaviour through unstructured group interaction. Activities that help team members learn how each member thinks and works. Changing the attitudes, stereotypes, and perceptions that work groups have about each other. A technique for assessing attitudes and perceptions, identifying discrepancies in these, and resolving the differences by using survey information in feedback groups. An outside consultant helps the manager understand how interpersonal processes are affecting the way work is being done.

15. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 15 Managing Resistance to Change Why People Resist Change –The ambiguity and uncertainty that change introduces –The comfort of old habits –A concern over personal loss of status, money, authority, friendships, and personal convenience –The perception that change is incompatible with the goals and interests of the organization

16. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 16 Exhibit 16.4 Helping Employees Accept Change UnfreezingRefreezingChanging Give reasons. Be empathetic. Communicate clearly. Show top management’s support. Publicize successes. Make midcourse corrections. Help employees deal with stress. Explain the benefits. Identify a champion. Get input from employees. Watch timing. Maintain job security. Provide training. Proceed at a manageable pace.

17. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 17 Stimulating Innovation Creativity –The ability to combine ideas in a unique way or to make an unusual association Innovation –Turning the outcomes of the creative process into useful products, services, or work methods

18. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 18 Exhibit 16.5 Systems View of Innovation Source: Adapted from R.W. Woodman, J.E. Sawyer, and R.W. Griffin, “Toward a Theory of Organizational Creativity,” Academy of Management Review, April 1993, p. 309. Inputs Creative individuals, groups, organizations Transformation Creative environment, process, situation Outputs Innovative product(s), work methods

19. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 19 Exhibit 16.6 Innovation Variables STIMULATE INNOVATION Structural Variables Organic Structures Abundant Resources High Interunit Communication Minimal Time Pressure Work and Nonwork Support Human Resource Variables High Commitment to Training and Development High Job Security Creative People Cultural Variables Acceptance of Ambiguity Tolerance of the Impractical Low External Controls Tolerance of Risks Tolerance of Conflict Focus on Ends Open-System Focus Positive Feedback

20. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 20 Creating the “Right” Environment for Innovation Structural Variables –Adopt an organic structure –Make available plentiful resources –Engage in frequent interunit communication –Minimize extreme time pressures on creative activities –Provide explicit support for creativity

21. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 21 Creating the “Right” Environment for Innovation (cont’d) Cultural Variables –Accept ambiguity –Tolerate the impractical –Have low external controls –Tolerate risk taking –Tolerate conflict –Focus on ends rather than means –Develop an open-system focus –Provide positive feedback

22. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 22 Creating the “Right” Environment for Innovation (cont’d) Human Resource Variables –Actively promote training and development to keep employees’ skills current –Offer high job security to encourage risk taking –Encourage individuals to be “champions” of change

23. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 23 Issues in Managing Change Changing Organizational Cultures –Cultures are naturally resistant to change –Conditions that help cultural change: Dramatic crisis Change of leadership Young, flexible, and small organization Weak organizational culture

24. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 24 Tips for Managers: Strategies for Managing Cultural Change Set the tone through management behaviour. Managers, particularly top management, need to be positive role models. Create new stories, symbols, and rituals to replace those currently in vogue. Select, promote, and support employees who adopt the new values that are sought. Redesign socialization processes to align with the new values.

25. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 25 Tips for Managers: Strategies for Managing Cultural Change (cont’d) Change the reward system to encourage acceptance of a new set of values. Replace unwritten norms with formal rules and regulations that are tightly enforced. Shake up current subcultures through transfers, job rotation, and/or terminations. Work to get peer-group consensus through employee participation and creation of a climate with a high level of trust.

26. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 26 Issues in Managing Change (cont’d) Handling Employee Stress –Stress The physical and psychological tension an individual feels when confronted with extraordinary demands, constraints, or opportunities and their associated importance and uncertainties Functional Stress –Stress that has a positive effect on performance

27. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 27 Exhibit 16.7 Causes of Stress

28. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 28 Exhibit 16.8 Symptoms of Stress SYMPTOMS OF STRESS PHYSICAL BEHAVIOURAL PSYCHOLOGICAL Job-related dissatisfaction, tension, anxiety, irritability, boredom, and procrastination Changes in productivity, absenteeism, job turnover, changes in eating habits, increased smoking or consumption of alcohol, rapid speech, fidgeting, sleep disorders Changes in metabolism, increased heart and breathing rates, raised blood pressure, headaches, and potential of heart attacks

29. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 29 Issues in Managing Change (cont’d) Reducing Stress –Engage in proper employee selection –Match employees’ abilities to job requirements –Use realistic job previews to reduce ambiguity –Improve organizational communications –Develop a performance planning program –Use job redesign –Provide a counselling program –Offer time planning management assistance –Sponsor wellness programs

30. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 30 Exhibit 16.9 Mistakes Managers Make When Leading Change UnfreezingRefreezingChanging Not communicating a sense of urgency Not forming a guiding coalition Quitting before change is finished Not making changes part of the organizational culture Not creating a vision Not communicating the vision Not empowering others to act on the vision Not planning for and creating short-term wins

31. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 31 Issues in Managing Change (cont’d) Making Change Happen Successfully –Embrace change –Explain why change is necessary –Communicate constantly and honestly –Encourage employee participation –Encourage employee flexibility –Remove those who resist and cannot be changed

32. Chapter 16, Stephen P. Robbins, Mary Coulter, and Nancy Langton, Management, Eighth Canadian Edition. Copyright © 2005 Pearson Education Canada Inc. 32 Exhibit 16.10 Characteristics of Change-Capable Organizations Link the present and the future Make learning a way of life Actively support and encourage day-to-day improvements and changes Ensure diverse teams Encourage mavericks Shelter breakthroughs Integrate technology Build and deepen trust