CHANGE Chapter 13

The Concept of Change

Change is taking part of the existing organisation and altering it to establish a new or different form.

Change occurs because of pressures placed on organisations. Change can lead to adjustments to structure, activities, policies, behaviours, procedures and corporate culture.

Note that change is often stressful to those involved in the process.

Change

Managing change effectively can be one of the most difficult processes an organisation has to undertake.

Effective change management change requires the use of management skills in order to effectively develop suitable management styles and structures .

In order to fully understand why employees are often hesitant to change can be helped by identifying what the outcomes of change are . Change outcomes can include; restructuring, retraining, transferring, downsizing, closure, expansion, mergers, acquisition & consolidation.

Why change? The commercial world is extremely complex and

sophisticated.

LSO’s Operate within the external environment (operating & macro). These pressures often bring on the need to change.

Internal pressures such as structure, corporate culture, management styles & employees can also lead to changes within the organisation.

Change is necessary to maintain a dynamic and fluid organisation with employees and systems capable of responding to wider industry needs.

Change and Success

Just because an organisation operates effectively and meets its goals does not mean it can become complacent and stand still.

If an organisation remains still while its competitors improve it is actually moving backwards.

An organisation that does not manage change successfully may find its self a target for take over or extinction.

Macro Pressures

Macro Pressures

Other macro pressures include:

Geographic pressures – organisations must be able to manage the diversity of its clients and customers with an increase in globalisation.

Environmental pressures – an increase in awareness of environmental impact has left organisations ensuring that their practices are environmentally responsible and friendly.

Operating Pressures

Customers – an organisation must ensure that it is customer focused to succeed. This means keeping up with forever changing customer wants and needs.

Suppliers – an organisation relies on its suppliers to obtain all the necessary inputs needed to operate.

Competitors – organisations must change to keep up with its competitors. They also need to at times be proactive to stay ahead!

Internal Pressures

Employees – the most important resource/asset of an organisation and can impact of productivity. Can place pressure for change in areas including training, working conditions and polices.

Management – selected management style may influence the organisation.

Policies - changes to policy may occur due to changes in the macro environment.

Corporate culture – if corporate culture is seen to be negative, somethings must be changed!

Driving & Restraining Forces For Change

Kurt Lewin developed the concept of force field analysis. He developed his theory as a tool to understand problems and the effects of change on organisations.

Force field analysis examines both driving and restraining forces for change.

Driving forces are those that push in the direction of the proposed change.

Restraining forces act to decrease or stop the driving forces.

If the driving forces are greater than the restraining forces then change will occur.

If the driving forces and restraining forces are equal, change will not occur successfully.

If the restraining forces are greater than the driving forces then the change is unlikely to be successful.

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Resistance To Change

Dealing with change is hard.

Change may interfere with routines, processes and values, change may also insinuate that the current practices are wrong.

Given this resistance organisations need to formulate an effective change management process.

Kotter’s Theory of Change Management

Kotter came up with a theory outlining how change can be successfully implemented. This is an eight-stage theory. The key stages or principles are;

1. Establish a sense of urgency.

2. Ensemble a group of people who will lead the organisation through the changes.

3. Create a vision for the organisation.

4. Communicate the vision to everyone in the organisation.

5. Empower others to act on the vision and remove any obstacles.

6. Plan to achieve short term gains & wins. Celebrate these at each stage.

7. Consolidate the changes that have taken place.

8. Institutionalise new approaches and create a new culture (embed these in the practices of the organisation).

Effective Change Management An effective change management

process can allow an organisation to take more of an proactive approach to change.

An effective change management process may also help minimise resistance to change and generate successful outcomes for all stakeholders.

Change Management Process

When implementing change an organisation should consider the following:

1. What is our current situation?

2. Why do we need to change?

3. Where do we want to go?

4. How will we get there?

5. Who will be involved?

6. Which methods will be used to measure success?

Strategies For Effective Change Management

Low-risk tactics - Participative approach to implementation of change. Organisations should try to use these. They include; two-way communication, employee empowerment, establishment of work teams & support & counselling for staff.

High-risk tactics – Autocratic approach to implementing change. These tactics include; coercion & threats, manipulation eg. leave out information & details, use of an autocratic management style.

Tactics/Strategies

1. Educate leaders of change to ensure they understand what the change is.

2. Use a ‘systems’ approach.

3. Use a team approach.

4. Share power with others.

5. Make plans but ‘plan loosely’.

6. Realise there will be tension – not too quick, not too long.

7. Provide training & development for staff.

Tactics/Strategies

8. Choose innovative practices that are supported by evidence.

9. Recognise that change happens through people.

10. Be prepared for ‘implementation dip’.

11. Help employees understand.

12. Seek out those who can help drive the change.

13. Take a long term view, change takes time.

Leadership & Change

For change to be effectively managed it requires effective leadership.

Leaders often communicate a vision, and brings others along.

Leaders need to have highly developed communication skills, the ability to build teams and develop talent.

Leadership is critical to the culture of an organisation.

This means that leaders are highly influential when it comes to values and ethical judgement.

Changing or moulding corporate culture to better support business performance is a focus of many modern leaders.

Leadership and Cultural Change