Chapter 11

Managing Change and Innovation

Made By :
 Andyka Dwi Kurniawan_202060302
 Raja Muda Singabutar Sihombing_202060280
Innovation and the Changing Workplace
Why Do People Resist Change?
Self-Interest
People typically resist a change they believe conflicts with their self-
interests. A proposed change in job design, structure, or technology
may increase employees’ workload, for example, or cause a real or
perceived loss of power, prestige, pay, or benefits.

Lack of Understanding and Trust

Employees often distrust the intentions behind a change or do not
understand the intended purpose of a change. If previous work-ing
relationships with a manager or promoter of an idea have been
negative, resistance may occur.

Uncertainty
Uncertainty is lack of information about future events. It represents a
fear of the unknown. It is especially threatening for employees who
have a low tolerance for change and fear anything out of the ordinary.
They do not know how a change will affect them and worry about
whether they will be able to meet the demands of a new procedure or
technology.

Different Assessments and Goals

People who will be affected by a change or innovation may assess the
situation differently from managers or promoters of a new idea. Critics
frequently voice legitimate disagreements over the proposed benefits
of a change. Managers in each department pursue different goals, and
an innovation may de-tract from performance and goal achievement
for some departments.

Disruptive Innovation
Disruptive innovation refers to innovations in products or services
that typically start small and end up completely replacing an existing
product or service technology for producers and consumers.

Reverse innovation refers to creating innovative, low-cost products

for emerging markets and then quickly and inexpensively repackaging
them for sale in developed countries.
 The Ambidextrous Approach
An ambidextrous approach means incorporating structures and
processes that are appropriate for both the creative impulse and for the
systematic implementation of innovations.

Changing Things: New Products and Technologies

A product change is a change in the organization’s product or service
outputs. Product and service innovation is the primary way in which
organizations adapt to changes in markets, technology, and
competition.

A technology change is a change in the organiza-tion’s production

process (how the organization does its work). Technology changes are
designed to make the production of a product or service more efficient.

Exploration
Exploration is the stage where ideas for new products and technologies
are born. Managers design the organization for exploration by
establishing conditions that encourage creativity and allow new ideas
to spring forth.

Creativity refers to the generation of novel ideas that might meet

perceived needs or respond to opportunities for the organization.

Cooperation
Ideas for product and technology innovations typically originate at
lower levels of the organization and need to flow horizontally across
departments. In addition, people and organizations outside the firm can
be rich sources of innovative ideas. Lack of innovation is widely
recognized as one of the biggest problems facing today’s businesses.

Internal Coordination
Successful innovation requires expertise from several departments
simultaneously, and failed innovation is often the result of failed
cooperation.

Companies that successfully innovate usually have the following

characteristics:

●People in research and marketing actively work with

customers to understand their needs and develop solutions.
 ●Technical specialists are aware of recent developments and
make effective use of new technology.

●A shared new product development process that is advocated

and supported by top management cuts across organizational
functions and units.

●Members from key departments—research, manufacturing,

marketing—cooperate in the development of the new product
or service.

●Each project is guided by a core cross-functional team from

beginning to end.

External Coordination
Successful companies often include customers, strategic partners,
suppliers, and other outsiders directly in the product and service
development process. One of the hottest trends is open innovation.

Open innovation means extending the search for and

commercialization of new ideas beyond the boundaries of the
organization and even beyond the boundaries of the industry, sharing
knowledge and resources with other organizations and individu-als
outside the firm.

Innovation Roles
Idea champion is a person who sees the need for and champions
productive change within the organization.

New-venture team, which is a unit separate from the rest of the

organization that is responsible for developing and initiating a major
innovation.

Skunkworks, a separate, small, informal, highly autonomous, and

often secretive group that focuses on breakthrough ideas for a
business.

New-venture fund, which provides resources from which individuals

and groups can draw to develop new ideas, products, or businesses.
Changing People and Culture
People change concerns just a few employees, such as sending a
handful of middle managers to a training course to improve their
leadership skills.

Culture change pertains to the organization as a whole, such as when

the Internal Revenue Service (IRS) shifted its basic mindset from an
organization focused on collection and compliance to one dedicated to
informing, educating, and serving customers (i.e., taxpayers).

Training and Development

Training is one of the most frequently used approaches to changing
people’s mind-sets. A company might offer training programs to large
blocks of employees on subjects such as teamwork, diversity,
emotional intelligence (EQ), quality circles, communication skills, or
participative management.

Successful companies want to provide training and development

opportunities for everyone, but they might particularly emphasize
training and development for managers, with the idea that the behavior
and attitudes of managers will influence people throughout the
organization and lead to culture change.

Organization Development (OD)

Organization development (OD) is a planned, systematic process of
change that uses behavioral science knowledge and techniques to
improve an organization’s health and effectiveness through its ability
to adapt to the environment, improve internal relationships, and
increase learning and problem-solving capabilities.

OD can help managers address at least three types of current problems:

 Mergers/acquisitions. The disappointing financial results of

many mergers and acqui-sitions are caused by the failure of
executives to determine whether the administrative style
and corporate culture of the two companies fit.
 Organizational decline/revitalization. Organizations under-
going a period of decline and revitalization experience a
variety of problems, including a low level of trust, lack of
innovation, high turnover, and high levels of conflict and
stress.
 Conflict management. Conflict can occur at any time and
place within a healthy organization.
 OD Activities
OD consultants use a variety of specialized techniques to help meet
their goals. Three of the most popular and effective are the following:

 Team-building activities.team building enhances the

cohesiveness and success of organizational groups and
teams.
 Survey-feedback activities.Survey feedback begins with a
questionnaire distributed to employees on values, climate,
participation, leadership, and group cohesion within their
organization.
 Large-group interventions. The large-group intervention
approach brings together participants from all parts of the
organization—often including key stakeholders from
outside the organization as well—to discuss problems or
opportunities and plan for change.

OD Steps

1. The first stage, unfreezing, makes people throughout the

organization aware of prob-lems and the need for change.
This stage creates the motivation for people to change their
attitudes and behaviors.
2. The second stage,changing, occurs when individuals
experiment with new behavior and learn new skills to be
used in the workplace. This process is sometimes known as
intervention, during which the change agent implements a
specific plan for training managers and employees.
3. The third stage, refreezing, occurs when individuals acquire
new attitudes or values and are rewarded for them by the
organization. The impact of new behaviors is evalu-ated
and reinforced.

Implementing Change
Create a Sense of Urgency
A crisis or strong need for change lowers resistance. To effectively
lead change, managers help people feel the need for change rather than
just giving them facts and figures.

Many organizational problems are subtle, so managers have to

recognize and then make others aware of the need for change. A need
for change is a disparity between existing and desired performance
levels.
Apply Force-Field Analysis
Force-field analysis grew from the work of Kurt Lewin, who proposed
that change was a result of the competition between driving and
restraining forces.

Driving forces can be thought of as problems or opportunities that

provide motivation for change within the organization.

Restraining forces are the various barriers to change, such as a lack of

resources, resistance from middle managers, or inadequate employee
skills.

Use Implementation Tactics

Top Management Support

The visible support of top management makes people aware of the

importance of the change. Top management support is especially
important when a change involves multiple departments or when
resources are being reallocated among departments.

Communication and Education

Communication and education are used when solid information about

the change is needed by users and others who may resist
implementation.

Participation

Participation involves users and potential resisters in designing the

change. This approach is time consuming, but it pays off because users
understand and become committed to the change.

Negotiation

Negotiation is a more formal means of achieving cooperation.

Negotiation uses formal bar-gaining to win acceptance and approval of
a desired change.

Coercion

Coercion means that managers use their formal power to force

employees to change. Resisters are told to accept the change or lose
rewards (or even their jobs). In most cases, this approach should not be
used because employees feel like victims, are angry at change
managers, and may even sabotage the changes. However, coercion
may be necessary in crisis situations when a rapid response is urgent.
 Chapter 12
Managing Human Resource

Made By :
  Andyka Dwi Kurniawan_202060302
 Raja Muda Singabutar Sihombing_202060280
The Strategic Role of HRM Is to Drive Organizational
Performance
The Strategic Approach
The best HR departments not only support strategic objectives, but also
actively pursue an ongoing, integrated plan for furthering the
organization’s performance.

Hiring and keeping high-quality employees with the right set of skills
is one of the most urgent concerns for today’s organizations.

Some current strategic issues of particular concern to managers include

the following:

 Hiring the right people to become more competitive on a

global basis
 Hiring the right people for improving quality, innovation,
and customer service
 Knowing the right people to retain after mergers,
acquisitions, or downsizing
 Hiring the right people to apply new information
technology (IT) for e-business

Building Human Capital To Drive Performance

To build human capital, HRM develops strategies for finding the best
people, enhancing their skills and knowledge with training programs
and opportunities for personal and professional development, and
providing compensation and benefits that support the sharing of
knowledge and appropriately reward people for their contributions to
the organization.

The Impact of Federal Legislation on HRM

Managing HR effectively is a complex challenge for managers. For
one thing, the legal and regulatory environment is constantly changing,
and HR managers have to stay on top of issues that might have legal
consequences. It is critically important that managers know and apply
a variety of federal laws that have been passed to ensure equal
employment opportunity (EEO).
 Discrimination occurs when hiring and promotion decisions are made
based on criteria that are not job-relevant.

Affirmative action requires that an employer take positive steps to

guarantee equal employment opportunities for people within protected
groups.

The Changing Nature of Careers

The Changing Social Contract
In the old social contract between organization and , the employee
could con-tribute ability, education, loyalty, and commitment and
expect in return that the company would provide wages and benefits,
work, advancement, and training throughout the employee’s working
life. Then along came globalization, outsourcing, hyper-competition,
and other volatile changes in the environment. The recent economic
downturn has accelerated the erosion of the old social contract.

Innovations in HRM
Branding the Company as an Employer of Choice
An employer brand is similar to a product brand, except that rather
than promoting a specific product, its aim is to make the organization
seem like a highly desirable place to work.

Using Temporary and Part-Time Employees

Contingent workers are becoming a larger part of the workforce in
both the United States and Europe. Contingent workers are people who
work for an organization, but not on a permanent or full-time basis.

Acquiring Start-Ups to Get the Talent

So-called acqui-hiring has become com-mon in the tech world.
Established companies such as Facebook, Google, Yahoo, LinkedIn,
and Salesforce.com buy early-stage start-ups, often shutting them
down, simply to acquire their engineering talent.

Finding the Right People

Human Resource Planning
Human resource planningis the forecasting of HR needs and the
projected matching of individuals with expected vacancies. By
 anticipating future HR needs, the organization can prepare itself to
meet competitive challenges more effectively than organizations that
react to problems only as they arise.

Recruiting
Recruiting is defined as “activities or practices that define the
characteristics of applicants to whom selection procedures are
ultimately applied.” recruiting is sometimes referred to as talent
acquisition to reflect the importance of the human factor in the
organization’s success.

Assessing Jobs
Basic building blocks of HRM include job analysis, job descriptions,
and job specifications.

Job analysis is a systematic process of gathering and interpreting

information about the essential duties, tasks, and responsibilities of a
job, as well as about the context within which the job is performed.

job description, which is a clear and concise summary of the specific

tasks, duties, and responsibilities,

job specification, which outlines the knowledge, skills, education,

physical abilities, and other characteristics needed to perform the job
adequately.

Realistic Job Previews

Job analysis also enhances recruiting effectiveness by enabling the
creation of realistic job previews (RJPs), whichgive applicants all
pertinent and realistic information—positive and negative—about the
job and the organization.

Social Media
Smart managers do much of their recruiting today via the Internet,
including social media sites such as LinkedIn, Facebook, and Twitter.

a survey by staffing services firm Spherion found that high-achieving

young professionals deem a company’s social media reputation as
important as the job offer when considering which company they want
to work for.

Internships
 An internship is an arrangement whereby an intern (usually a high
school or college student) exchanges free or low-cost labor for the
opportunity to explore whether a particular career is appealing or to
gain valuable work experience in a particular field.

Selecting
In the selection process, employers assess applicants’ characteristics in
an attempt to determine the “fit” between the job and applicant
characteristics.

Application Form
The application form is used to collect information about the
applicant’s education, previous job experience, and other background
characteristics.

One pitfall to be avoided is the inclusion of questions that are

irrelevant to job success. In line with EEO guidelines, the application
form should not ask questions that will create an adverse impact on
protected groups unless the questions are clearly related to the job.

Interview
Some type of interview is used as a selection technique in almost every
job category in nearly every organization.

Structured interviews use a set of standardized questions that are asked

of every applicant so that comparisons can easily be made.

With a nondirective interview, the inter-viewer asks broad, open-ended

questions and permits the applicant to talk freely, with minimal
interruption.

panel interviews, in which the candidate meets with several

interviewers who take turns asking questions.

Employment Test
employment tests may include cognitive ability tests, physical ability
tests, personality inventories, and other assessments. Cognitive ability
tests measure an applicant’s thinking, reasoning, verbal, and
mathematical abilities. Physical ability tests that measure qualities such
as strength, energy, and endurance.

Many companies also use various types of personality tests to assess

such characteris-tics as openness to learning, agreeableness,
 conscientiousness, creativity, and emotional stability. Another unusual
type of test, called a brain teaser, is being used by companies that put a
premium on innovativeness and problem solving.

Online Checks
The Internet gives recruiters and hiring managers a new way to search
for a candidate’s criminal record, credit history, and other indications
of honesty, integrity, and stability. Moreover, many companies want to
see what a candidate has to say about him or herself on blogs and
social networking sites to gauge whether the person would be a good
fit with the organization.

Developing Talent
Training and Development
Training and development programs represent a planned effort by an
organiza-tion to facilitate employees’ learning of job-related skills and
behaviors.

On-the-Job Training (OJT)

The most common type of training is on-the-job training (OJt), where
an experienced employee is asked to take a new employee “under his
or her wing” and show the newcomer how to perform job duties.

Social Learning
Social learning basically means learning informally from others by
using social media tools, including mobile technologies, social
networking, wikis and blogs, virtual games, and so forth.

Corporate Universities
Another popular approach to training and development is the corporate
university, an in-house training and education facility that offers broad
based learning opportunities for employees—and frequently for
customers, suppliers, and strategic partners as well—throughout their
careers.

Promotion from Within

 Another way to further employee development is through promotion
from within, which helps companies retain and develop valuable
people. Promotions provide more challenging assignments, prescribe
new responsibilities, and help employees grow by expanding and
developing their abilities.

Performance Appraisal
Performance appraisal refers to observing and assessing employee
performance, recording the assessment, and providing feedback to the
employee. During performance appraisal, skill-ful managers give
feedback and praise concerning the acceptable elements of the
employee’s performance. They also describe performance areas that
need improvement.

Assessing Performance Accurately

Jobs are multidimensional, and therefore performance may be
multidimensional as well. A recent trend in performance appraisal is
called 360-degree feedback, a process that uses multiple raters,
including self-rating, as a way to increase awareness of strengths and
weak-nesses and guide employee development.

Performance Evaluation Errors

Although we would like to believe that every manager assesses
employees’ performance in a careful and bias-free manner, researchers
have identified several rating problems.

the most dangerous is stereotyping, which occurs when a rater places

an employee into a class or category based on one or a few traits or
characteristics

Another rating error is the halo effect, in which a manager gives an

employee the same rating on all dimensions, even if his or her
performance is good on some dimensions and poor on others.

One approach to overcome performance evaluation errors is to use a

behavior-based rating technique, such as the behaviorally anchored
rating scale.

Maintaining an Effective Workforce

Compensation
 The term compensation refers to (1) all monetary payments and (2) all
goods or com-modities used in lieu of money to reward employees.

Wage and Salary Systems

The most common approach to employee compensation is job-based
pay, which means linking compensation to the specific tasks an
employee performs.

Skill-based pay systems are increasingly popular in both large and

small companies. Employees with higher skill levels receive higher
pay than those with lower skill levels.

Compensation Equity
Whether the organization uses job-based pay or skill-based pay, good
managers strive to maintain a sense of fairness and equity within the
pay structure and thereby fortify employee morale.

Job evaluation refers to the process of determining the value or worth

of jobs within an organization through an examination of job content.

Pay-for-Performance
Pay-for-performance, also called incentive pay, means tying at least
part of compensation to employee effort and performance, whether it
be through merit-based pay, bonuses, team incentives, or various gain-
sharing or profit-sharing plans.

Benefits
An effective compensation package requires more than money.
Although salary is an important component, benefits are equally
important.Organizations are required by law to provide some benefits,
such as Social Security, unemployment compensation, and workers’
compensation.

Rightsizing The Organization

Rightsizing refers to reducing the company’s workforce intentionally
to the point where the number of employees is deemed to be right for
the company’s cur-rent situation. Also called downsizing, planned
 reductions in the size of the workforce are a reality for many of today’s
companies.

Termination
Despite the best efforts of line managers and HRM professionals, the
organization will lose employees. Some will retire, others will depart
voluntarily for other jobs, and still others will be forced out through
mergers and cutbacks or for poor performance.

An exit interview is an interview conducted with departing employees

to determine why they are leaving the company.