COMH 321: HEALTH SERVICE MANAGEMENT

TOPIC FOUR: ORGANIZATION CHANGE MANAGEMENT

Introduction

Welcome to topic four. This topic will cover the following: Definition of change management,
types of change, change process, Lewin’s change model, forces of change, coping with change,
Employees’ resistance to change- causes and management, role of HRM in change management,
actors in change management.

Topic time

 Compulsory online reading and self-assessments [3.5 hours]

 Topic activity [1.0 hours]
 Total student input [4.5 hours]

Topic Learning Requirements

 Participation in one chat (at least 5 entries)

 At least two elaborate contributions to the discussion topic. You may also start your
own discussion thread.
 Timely submission of the assignments

Topic Learning Outcomes

By the end of this topic you should be able to:

i. Define Organisation Change

ii. Explain the process of implementing Change in an organization
iii. Describe causes and management of employees’ resistance to change.
iv. Distinguish between a change manager, agent and advocate.

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Topic content

4.1 Definition

 To change something implies altering it, varying or modifying it in some way- oxford
dictionary.
 Organizational Change is the movement of an organization from its current state or
practices to some future or alternative and hopefully more effective state or processes
in order to increase its effectiveness (Lunenburg, 2010)
 Change management refers to the processes and techniques to manage the people-side
of change (employees) and are usually implemented in a controlled and systematic
manner so as to achieve the required business outcome

All over the world, managers of organizations (and businesses) are under great pressure to
embrace change in order to ensure scarce resources are used effectively, and at the same time,
find ways of guaranteeing the long-term effectiveness of the organizations for which they work.

When you introduce a change to the organization, you are sooner or later going to be impacting
on one or more of the following four parts of how the organization operates:

 Processes
 Systems
 Organization structure
 Job roles

Change typically results as a reaction to specific problems or opportunities the organization is

facing based on internal or external stimuli. While the notion of 'becoming more competitive' or
'becoming closer to the customer' or 'becoming more efficient' can be the motivation to change,
at some point these goals must be transformed into the specific impacts on organization
processes, systems, structures or job roles.

4.2 Types of Change

1. Developmental Change

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This refers to a gradual improvement in skills, methods or processes to help an organization
function more efficiently. It results in an improvement in what is currently happening rather than
the formation of an entirely new process. This kind of change should be incorporated into the
company’s training and development programs and reviewed as part of its performance
evaluation process. Resistance to developmental change is usually not manifested in open
opposition but as a subtle refusal of individuals to learn new skills or adopt new procedures

2. Transitional Change

This is where an organization evolves slowly from old state to a new state- new organizational
structure. This kind of change usually occurs in defined transition steps such as a series of
delineated stages, pilot projects, phase-in operations, temporary arrangements and organizations.

3. Transformational Change

This kind of change is characterized by a radical reconceptualization of the organization’s

mission, culture, products, leadership or structure. It commonly occurs in companies that have
become stagnant and started to disintegrate e.g a company experiencing declining sales and a
loss of market share due to competition in the market. It may also occur because of a significant
paradigm change within the industry. The word paradigm comes from the Greek word for
“Pattern” and the new paradigm change is often due to a new pattern of behavior or a new way
of looking at the world. Paradigm changes often results from a new set of assumption, a new
thinking about a problem, or a new technological innovation that makes the former technology
obsolete.

Recognition of the need for a paradigm shift early enough can help to plan for gradual systematic
transitional change. On the contrary, organizations that fail to recognize the need for change until
they are in the middle of the chaos and turmoil are forced into transformational change that is
usually associated with frustration, uncertainty and crisis planning.

4.3 Change process

According to M. Armstrong (1995), the Change process normally takes three steps:

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 1. Awareness of the need for change

This includes the analysis of the situation and the factors that have created it which leads to a
diagnosis of their distinctive characteristics and the direction which needs to be taken. Possible
courses of action may be identified and evaluated and a choice made of the preferred action

2. Resistance stage

This is the most difficult stage to any person with responsibilities of introducing changes. It is
here that problems of introducing change emerge. These include: people resistance to change,
low stability, high levels of stress, misdirected energy, conflict and loss of momentum. The
managers have to be responsible enough to avoid chaos through showing high level of maturity
in managing change in the organization.

3. Implementation stage

The implementation of change is an interactive, cumulative and reformulation- in- use process.
Therefore, to manage change, it is necessary to understand the types of change and why people
resist change

4.4 Forces (causes) of Change

Many factors drive change in a business/organisation. These can be categorized into internal and
external forces:

a) Internal forces i.e forces within the organization:

i. Technology: The rate of technological change seems to increase every time whenever
new machines, manufacturing processes and/or scientific discoveries occur. New jobs are
created and old ones are phased out because of technological change.
ii. Inadequate skills for the job
iii. Work values: Organizations are forced to respond to the changing values of the members.
Some of the most significant changes include; priorities that puts family responsibility
ahead of work, decline in the sense of organizational loyalty, greater career mobility,
clamour for promotions and advancement, varied lifestyle and work schedules etc

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 iv. Product obsolescence: Technological advances and the explosion of knowledge make
various products obsolete in a short time
v. Alternative work schedules: In developed countries, many people prefer working from
their homes on a computer which save time and improve productivity
vi. Low performance & morale

b) External forces of change

Competent managers identify the external forces of change and respond appropriately to them.
These may include:

i. Competition
Changes in the market can destroy the profit of the company. Managers should know
when their rivals introduce new products, change their advertising, reduce their prices or
improve their customer service. Although competition creates uncertainty, it contributes
to development of better services and products to the consumer.
ii. Consumer demand
It is important for the manager to be concerned about change in consumer tastes and
preferences
iii. Availability of resources
Disruption in the supply of crucial resources can force the organization to change their
operations
iv. Social, legislative and political change

The organization must be ready to adapt to the social, legislative and political situation. For
example, state policies on pollution, toxic waste and safety hazards require the organization to
either comply or cease doing the business

4.5 Models of change implementation

It is normally the responsibility of concerned managers to effect changes. This is usually by use
of their managerial skills and by maintaining accepted organizational policies. There are many
change models to choose from. Some of these include:

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 I. Lewin Theory (Lewin’s Change management Model)

This is one of the cornerstone models for understanding organizational change. It was
developed by Kurt Lewin back in the 1950s, and still holds true today. His model is known
as Unfreeze – Change – Refreeze, which refers to the three-stage process of change he
describes. Lewin, a physicist as well as social scientist, explained organizational change
using the analogy of changing the shape of a block of ice.

Understanding Lewin's Model

If you have a large cube of ice, but realize that what you want is a cone of ice, what do you
do? First you must melt the ice to make it amenable to change (unfreeze). Then you must
mold the iced water into the shape you want (change). Finally, you must solidify the new
shape (refreeze).

To begin any successful change process, you must first start by understanding why the
change must take place - looking before you leap, so to speak. As Lewin put it, "Motivation
for change must be generated before change can occur.

1) Unfreeze

This first stage of change involves preparing the organization to accept that change is
necessary, which involves breaking down the existing status quo before you can build up a
new way of operating. Key to this is developing a compelling message showing why the
existing way of doing things cannot continue e.g you can point to declining sales figures,
poor financial results, worrying customer satisfaction surveys etc These shows that things
have to change in a way that everyone can understand.

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 This first part of the change process is usually the most difficult and stressful. When you start
cutting down the "way things are done", you put everyone and everything off balance. You
may evoke strong reactions in people- positive or negative.

2) Change

After the uncertainty created in the unfreeze stage, the change stage is where people begin to
resolve their uncertainty and look for new ways to do things. People start to believe and act
in ways that support the new direction. The transition from unfreeze to change stage does not
happen overnight. People take time to embrace the new direction and agree to participate
proactively in the change. In order to accept the change and contribute to making the change
successful, people need to understand how the changes will benefit them. However, not
everyone will fall in line just because the change is necessary and will benefit the company.
Some people will genuinely be harmed by change, particularly those who benefit strongly
from the status quo. Others may take a long time to recognize the benefits that change brings.

3) Refreeze

When the changes are taking shape and people have embraced the new ways of working, the
organization is ready to refreeze. The outward signs of the refreeze are a stable organization
chart, consistent job descriptions, and so on. The refreeze stage also needs to help people and
the organization internalize or institutionalize the changes. This means making sure that the
changes are used all the time; and that they are incorporated into everyday business. With a
new sense of stability, employees feel confident and comfortable with the new ways of
working

4.6 COPING WITH CHANGE

This is best explained by use of the “Change Curve” based on a model originally developed by
Elisabeth Kübler-Ross to explain the grieving process

Kübler-Ross “Change curve”

This is a model originally developed in the 1960s by Elisabeth Kübler-Ross to explain the
grieving process following loss or death of a loved one. Since then it has been widely utilized

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 as a method of helping people understand their reactions to significant change. It is a
powerful model to describe the stages of personal transition involved in most organizational
changes. It helps understand how people will react to change. Everyone will go through these
emotions, even if they are supportive of change. What will be different from person to person
is the rate of transition from one stage to the next.

Stage 1: Shock

The first reaction to change is usually shock. People’s faces may turn pale on hearing the
news that an unpopular boss is taking over the company, or the company is shutting down, or
the redundancies include them personally. The shock is often due to lack of information, fear
of the unknown or doing something wrong.

Stage 2: Denial

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 After the initial shock has passed, it’s common for people to experience denial. There’s likely
to be a feeling that since everything was okay as it was, why would there be need to a
change? It’s common for people to convince themselves that the change isn’t actually going
to happen, or if it does, that it won’t affect them. People carry on as they always have done
and make excuses to avoid taking part in forward planning as natural attempt to protect
themselves from the disruption ahead.

Stage 3: Frustration

The dip following the denial stage can be a very tough time when the clash of reality and the
denial of change can lead to frustration. Often people tend to blame others for the change and
feel sorry for themselves, seeing themselves as victims. People say things like they will block
the change and they are not going to allow this to happen. There is no acceptance of the
change yet.

Stage 4: Anger and/or Depression

After the feelings of shock, denial and frustration, anger is often the next stage. People show
their anger against the company and its managers, complain about the changes or the fact that
they don’t have the time or resources to make the change. The lowest point of the curve is
when the anger begins to wear off and the realization that the change is happening hits.
Depression is possible as the impact of what has been lost is acknowledged. At this point
performance is at its lowest and people have a tendency to fixate on small issues and
problems.

Stage 5: Experiment

This is where people start to experiment with the new situation and try new things out.
Perhaps some of these changes might be worth thinking about. People slowly begin to let go
of denial and work with change by starting to experiment with new ways of working and
behaving and considering all of the things they could do.

Stage 6: Decision

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 People are coming to terms with what has happened and are beginning to feel more positive
about the future. They are slowly accepting the change and are reaching new decisions on
what works best for them, which increases their self-esteem. At this stage people feel more in
control about what is happening and can feel surprised that the change didn’t happen sooner.

Stage 7: Integration

People have accepted the change, worked with it and finally integrated it into their lives
which allows them to move forward. The old situation no longer exists, nor is it thought
about much. The new regime is established and energy levels are high

4.6 RESISTANCE TO CHANGE

This refers to employees’ inability or unwillingness to accept organizational changes that are
perceived, in a way, damaging or threatening to the individual.

The reasons why change is resisted can be divided into three categories:

A. Employees’ personal barriers to change. These include;

i. Parochial self- interest. Individuals are concerned with the implications of change on
themselves; their view is often biased by their perception of a particular situation
ii. Habit. Habit provides both comfort and security and if well-established it is very
difficult to change
iii. Misunderstanding. Communications problems, inadequate information
iv. Low tolerance of change. Sense of insecurity
v. Different assessment of the situation. Disagreement over the need for change and the
advantages or disadvantages
vi. Economic implications. Employees are likely to resist change which is perceived as
affecting their pay or other financial rewards, or their established patterns of working
vii. Fear of the unknown. Proposed changes which confront people tend to generate fear and
anxiety e.g introducing new technology or working practices creates uncertainty

B. Organizational barriers to change:

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 i. Structural inertia. Normally, organizational structures are designed to maintain a stable
pattern of interaction among people. Any disruption is therefore resisted
ii. Threat to existing power structures. Changes have the potential to disrupt the power
structure. E.g decentralization of decision making may be seen as a way of removing
power from the high level employees to the low level employees in the organization
iii. Resistance from work groups. That is, system relationships such as the reporting
hierarchy of every department
iv. Failure of previous change initiatives. E.g sunk costs and vested interests make it difficult
to assess objectively the benefits of doing things differently.

C. Managerial barriers to change

Change can also be resisted because of the poor way in which change is managed. For example,
a failure by management responsible for the change to:

 Explain the need for change

 Provide information
 Consult, negotiate and offer support and training
 Involve people in the process
 Build trust and sense of security
 Build employee relations

As a result of change resistance and poorly managed change projects, many of organisations
ultimately fail to achieve their Change objectives.

4.7 How to deal with Resistance to Change:

1) Education and communication

This helps employees to understand the true need for Change as well as the logic behind
it.
2) Facilitation and support

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 When fear and anxiety are responsible for resistance to doing things in a different way,
support from management in the form of training, listening, counseling and
compensatory time off can be helpful
3) Participation and Involvement
Personal involvement through participation tends to defuse both rational and irrational
fears about a work change- by participating in the design and implementation of change
one acquires a personal stake in its success (feeling of ownership)
4) Negotiation and agreement
Sometimes, management can neutralize potential or actual resistance by exchanging
something of value for the sake of cooperation e.g placing all employees on contractual
terms to permanent terms
5) Manipulation and co-opting
Manipulation occurs when managers selectively withhold or dispense information and
consciously arrange events to increase the chance that a change will be successful. Co-
opting normally involves token participation.
6) Explicit and Implicit coercion
Managers who cannot invest in the time required for the systematic implementation of
Change strategies force change by threatening employees with termination, transfers, loss
of pay raises or promotions.

4.8 The role of human resources manager in implementation of change.

This includes:

a. Education and communication

This helps employees to understand the true need for Change as well as the logic behind it.

b. Facilitation and support

When fear and anxiety are responsible for resistance to doing things in a different way, support
from management in the form of training, listening, counseling and compensatory time off can
be helpful

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 c. Participation and Involvement

Personal involvement through participation tends to defuse both rational and irrational fears
about a work change- by participating in the design and implementation of change one acquires a
personal stake in its success (feeling of ownership)

d. Negotiation and agreement

Sometimes, management can neutralize potential or actual resistance by exchanging something

of value for the sake of cooperation e.g placing all employees on contractual terms to permanent
terms.

To effectively lead change, it is important to recognize that the ‘change’ itself does not need as
much managing as the people involved in it. Therefore, change management focuses mainly on
people in order to ensure that change is systematically and effectively implemented.

e. Communicating Change

Communication plays a critical role in overcoming the fears and concerns stimulated by change.
People are often concerned about the effect the change will have on them. Uncertainty in a
working environment reduces productivity, therefore, it is important to communicate what is
changing and why.

Communication should be an ongoing process. As the change process advances, two things will
happen – people have new questions and new ideas, and they develop a better understanding of
the intermediate and final states. In response, people have to be kept updated with actual and
future states, and their questions should be answered.

The best method of communication is for managers to communicate a well-prepared change

message that is accompanied with support materials eg reports, statistics, vision of the
organization, reports of change success in other organizations etc. The communication should
start at the top management of the organization and then flow to each level (or department) of the
organization. As a result, most people will first hear the change message from their supervisor
and be able to ask questions. The supervisors need to understand the message well enough to
communicate it to their team members and, in turn, answer their questions. This allows for a

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single message and accompanying support material to be communicated across the organization
effectively

4.9 Change management activities

The range of possible change management activities is broad. The key here is to identify the
tasks that are necessary to give change the greatest chance of success. The key activities involved
in managing change include:

1. Ensure clear expression of the reasons for change and help the sponsor communicate.
2. Identify change agents for specific change activities, such as design, implementation and
evaluation.
3. Assess all the stakeholders and define the nature of sponsorship, involvement, and
communication necessary
4. Plan how and when the changes will be communicated and delivered.
5. Assess the impact of the changes on people and the organization's structure.
6. Plan activities needed to address the impact of the change.
7. Ensure that people involved and affected by the change understand the change process.
8. Ensure those involved or affected have help and support during times of uncertainty or
upheaval.
9. Assess training needs driven by the change and plan when and how this will be
implemented.
10. Identify and agree on the success indicators for change, and ensure they are regularly
measured and reported.

Failure of Change

There is no denying that change is tough. When planning change it is also important to look at
why change may fail to bring the desired results. Key reasons why change fails include:

1. The organization is not clear about the reasons for the change and the overall objectives,
hence plays into the hands of vested interests

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 2. The organization fails to move quickly from speech to action which leads to mixed
reactions and resistance.
3. Leaders are not prepared for the change in management style required to manage a
changed business.
4. The chosen change methodology or approach did not suit the business
5. The organization has not been prepared and the internal culture “pushed back” against
change
6. The business implements certain functions with little regard for others. E. g Changes one
part of the process and not considered the impact up- or downstream.
7. Leaders set strategic direction for the change and then they remained remote from the
change, leaving the actual change to less motivated people

The key role actors in the management of change

i. Change Sponsor

A change sponsor is someone who has the authority, seniority, power, enthusiasm and time to
lead/ carry through/ oversee the desired organizational change. He or She may not be involved
with the day to day management of the change but must ensure the necessary resources are
available throughout the change process and accept ultimate responsibility for the successful
change implementation e.g the Ministry of health

ii. Change Agent

Change agent is the individual or group that undertakes the task of initiating and managing
change (implementing change) in an organization. This may be either external (from outside) or
internal to the organization. External change agent, coming from outside the organization,
presents both advantages and disadvantages

Advantages of external change agent

 The person is unbiased, sees problems more objectively and can contribute valuable
insights from other organizations

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  After a feeling of trust has been established, employees are usually more willing to speak
openly about sensitive matters

Disadvantages consist of

 External change agents sometimes have difficulty establishing employees trust and their
lack of experience with the organizaton prevents them from identifying the root causes of
the problems
 External change agents are typically inclined to recommend more drastic changes which
may be disruptive to the organization

iii. Change manager

This is someone with the expertise and credibility to lead the team implementing the change and
can act as the role model for the new reality. He/She may be an experienced project manager
within the organization or brought from outside the organization with the specific responsibility
of managing the change.

iv. Change advocate

This is an individual or group that wants to achieve change but does not possess the legitimate
power to effect change – they see the need for change but do not have organizational power to
implement it. E.g civil societies, human rights groups etc

Topic summary

In this topic, you have learned about organization Change, its causes, implementation and what
may read to employees’ resistance to change. You also learned the different types of change,
change process, models and how to manage the resistance to change. Also, you have learned
about the different change actors.

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Further reading

Mandatory reading

 Dam N. V and Marcus J (2012), organization and management- An international

approach, Groninton/Houten, The Netherlands

Optional reading

1. Ivancevich J.M and Matteson M.T (1987), organizational behavior and management,
business publications inc, Plano, Texas

Topic activities Assignment:

Read and make short notes on “Kotter's Change Model”

Assignment 1 (self-assessment, not for marking)

1. Define organization change

2. A local health centre belonging to a church has been taken over by a county government
with an intention of transforming it into a level 4 county hospital in order to improve
healthcare services provided to the population. A new medical officer has been posted to
the facility to oversee the changes. Explain the challenges he is likely to encounter and
how he can mitigate for them.

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