1. Chapter 11 Change and Innovation

2. Innovation and Change in the Workplace If organizations don’t successfully change and innovate, they die Change and innovation can come from outside forces Managers want to initiate change from the inside Disruptive innovation is a goal for global competition Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.2

3. Organizational Change The adoption of a new idea or behavior by an organization Change is not easy, organizations must take an ambidextrous approach Managers encourage flexibility and freedom to innovate Change –does not occur by itself Need-personal energy and effort to successfully promote new idea Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.3

4. Changing Things: New Products and Technologies Product Change – a change in the organization’s product or service outputs Technology Change – a change in the organization’s production process Three innovation strategies: exploration, cooperation, and entrepreneurship Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.4

5. 11.1 Three Innovation Strategies Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 5

6. 11.2 Characteristics of Creative People and Organizations Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 6

7. 11.3 The World’s Most Innovative Companies Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 7

8. Creativity – novel ideas that meet perceived needs or offer opportunities Idea incubator – a safe harbor where employees can develop ideas and experiment Exploration Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.8

9. Cooperation Horizontal coordination mechanisms – simultaneously contribute to innovation – Internal coordination Encourage cross department to work together: Horizontal Linkages Model – External Coordination Look outside boundaries to find and develop new ideas; Open innovation – commercialization of ideas beyond the organization – Includes customers and partners e.g P&G, Threadless,Heinz, Shell? Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.9

10. 11.4 Coordination Model for Innovation Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 10

11. Mechanism for new ideas to be promoted, accepted and implemented Support entrepreneurial activities; degree of autonomy, reward learning, risk taking Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 11

12. Managers should support entrepreneurship activities and foster idea champions; Champions :passionate and committed Championing idea requires roles in organization ;sometimes a single person or different person adop these roles Entrepreneurship Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.12

13. 11.5 Four Roles in Organizational Change Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 13

14. New-venture teams Develop & initiate innovation give free rein to creativity-separate location, unrestricted to procedures/policies Skunkworks are informal, autonomous, secretive groups that focus on breakthrough ideas; Loockeed Martin, Xerox, Ford New-venture funds provide resources for new ideas Facilitating Entreprenuership Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 14

15. Changing People and Culture Changes in how employees think – Changes in mind-set People change = Training and Development Culture change = Organizational Development Large culture change is not easy Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.15

16. Organizational Development Planned, systematic process of change using behavioral science Addresses three types of problems:  Mergers and acquisitions  Organizational decline and revitalization  Conflict management Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.16

17. OD Activities Team-building activities -enhance cohesiveness: cross depmt teams Survey-feedback activities -ask about values, climate, leadership, group cohesion; after complete consultant meet employees to discuss feedback OD Steps: Unfreezing Changing Refreezing Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.17

18. Large-group interventions -large participants ;stakeholders inside & outside -discuss problems or opportunities OD Activities Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 18

19. OD Steps: Unfreezing Diagnosing problem Make people aware of problems & need for change; present performance, use change agent Changing Individuals experiment new behavior, teach new behavior, skills, guide Refreezing People have incorporate new values;institutionalized in culture, attitudes, orgz giver reward OD STEPS Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 19

20. 11.6 OD Approaches to Culture Change Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 20

21. Implementing Change Outline the Need for Change – Show the performance gap Understand the Resistance to Change – Self-Interest – Lack of Understanding and Trust – Uncertainty – Different Assessments and Goals Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.21

22. 11.7 Force-Field Analysis Driving forces – problems or opportunities that provide motivation for change Restraining forces – barriers to change Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 22

23. 11.8 Tactics for Overcoming Resistance to Change Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved. 23