Change Management

What is Organizational
Change?
 Organizational change: the
process by which organizations
move from their present state to
some desired future state to
increase their effectiveness
Forces for and Resistance to
Change
Lewin’s Force-Field Theory of
Change
 Theory of change which argues that
two sets of opposing forces within an
organization determine how change
will take place
 Forces for change and forces making
organizations resistant to change
 To change an organization, managers
must increase forces for change and
decrease forces resisting change
Lewin’s Theory
8 Steps to Transforming your Organization (Kotter,
1995)
Establishing a Sense of Urgency
1 •
•
Examining market and competitive realities
Identifying and discussing crises, potential crises, or major opportunities

Forming a Powerful Guiding Coalition

2 •
•
Assembling a group with enough power to lead the change effort
Encouraging the group to work together as a team

Creating a Vision
3 •
•
Creating a vision to help direct change effort
Developing strategies for achieving that vision

Communicating the Vision

4 •
•
Using every vehicle possible to communicate the new vision and strategies
Teaching new behaviours by the example of the guiding coalition
Empowering others to Act on the Vision
5 •
•
Getting rid of obstacles to change
Changing systems or structures that seriously undermine the vision
• Encouraging risk taking and non-traditional ideas, activities, and actions

Planning for and Creating Short Term Wins

6 •
•
Planning for visible performance improvements
Creating those improvements
• Recognising and rewarding employees involved in the improvements

Consolidating Improvements and Producing Still More Change

7 •
•
Using increased credibility to change systems, structures, and policies that don’t fit the visio
Hiring, promoting, and developing employees who can implement the vision
• Reinvigorating the process with new projects, themes, and change agents
Institutionalizing New Approaches
8 •
•
Articulating the connections between the new behaviours and corporate success
Developing the means to ensure leadership development and succession
Evolutionary and Revolutionary
Change in Organizations
 Evolutionary change: change
that is gradual, incremental, and
specifically focused
 Revolutionary change: change
that is sudden, drastic, and
organization-wide
Developments in Evolutionary
Change
 Sociotechnical systems theory: a theory
that proposes the importance of changing role
and task or technical relationships to increase
organizational effectiveness
 Total quality management (TQM): a
technique developed by W. Edwards Deming to
continuously improve the effectiveness of
flexible work teams
 Quality circles: groups of workers who

meet regularly to discuss the way work is

performed in order to find new ways to
increase performance
Developments in Evolutionary
Change
 Flexible workers and flexible work
teams: a group of workers who
assume responsibility for performing
all the operations necessary for
completing a specified stage in the
manufacturing process
 Flexible work teams also assume
responsibility for TQM efforts.
 Managers’ role is to facilitate the team
activities.
Use of Teams to Assemble
Cars
Developments in
Revolutionary Change
 Reengineering: involves rethinking and
redesigning business processes to increase
organizational effectiveness
 Instead of focusing on an organization’s
functions, the managers of a reengineered
organization focus on business processes.
 Business process: an activity which
cuts across functional boundaries and
which is vital to the quick delivery of
goods and services, or that promotes
high quality or low costs
Guidelines for Reengineering
 Three guidelines for performing
reengineering successfully are:
1. Organize around outcomes, not
tasks
2. Have those who use the output of
the process perform the process
3. Decentralize decision making to the
point where the decision is made
Developments in
Revolutionary Change
 Restructuring: changing task and
authority relationships and
redesigning organizational structure
and culture to improve organizational
effectiveness
 Downsizing: the process of
streamlining the organizational
hierarchy and laying off managers
and workers to reduce bureaucratic
costs
The Limits of Restructuring
 Failure of many restructuring efforts
 How compulsive restructuring affects
people
 Shift of change management focus from
“anatomical” to “physiological” – from
strategy-structure-systems to people-
processes-rewards
 Knowledge management for cross-unit learning
and collaboration
 Align performance management objectives to
force cooperation
 Replace formal hierarchy by responsibility and
knowledge
Developments in
Revolutionary Change
 Innovation: the process by which
organizations use their skills and
resources:
 To develop new goods and services OR
 To develop new production and operating
systems so that they can better respond
to the needs of their customers
Managing Change: Action
Research
 Action research: a strategy for
generating and acquiring
knowledge that managers can
use to define an organization’s
desired future state
 To plan a change program that
allows the organization to reach
that state
Steps in Action Research
Five Steps in Action Research
1. Diagnosing the organization
 Recognize problems and need to solve
problems
2. Determining the desired future state
3. Implementing action
 Three-step process
1) Managers need to identify possible
impediments to change.
Implementing Action: Step 2
2. Deciding who will be responsible for
actually making the changes and
controlling the change process
 External change agents: people who
are outside consultants who are experts
in managing change
 Internal change agents: managers
from within the organization who are
knowledgeable about the situation to be
changed
Implementing Action: Step 3
3. Deciding which specific change
strategy will most effectively
unfreeze, change, and refreeze the
organization
 Top-down change: change that is
implemented by managers at a high level in
the organization
 Bottom-up change: change that is
implemented by employees at low levels in
the organization and gradually rises until it
is felt throughout the organization
 Managing Change: Action
Research
4. Evaluating the action: evaluating the
action that has been taken and
assessing the degree to which the
changes have accomplished the
desired objectives
5. Institutionalizing action research
 Members at all levels must be rewarded
for their efforts.
Organizational Development
(OD)
 Organizational development
(OD): a series of techniques and
methods that managers can use in
their action research program to
increase the adaptability of their
organization
OD Techniques to Deal with
Resistance to Change
 Education and communication: inform
workers about change and how they will be
affected
 Participation and empowerment: involve
workers in change
 Facilitation: help employees with change
 Bargaining and negotiation
 Manipulation: change the situation to
facilitate change
 Coercion: force workers to accept change
OD Techniques to Promote
Change
 Counseling: help people understand
how their perception of the situation
may not be right
 Sensitivity training: intense
counseling in which group members,
aided by a facilitator, learn how others
perceive them and may learn how to
deal more sensitively with others
Organizational Development
 Process consultation: an OD technique in
which a facilitator works closely with a
manager on the job to help the manager
improve his or her interactions with other
group members
 Team building: an OD technique in which
a facilitator first observes the interactions of
group members and then helps them
become aware of ways to improve their
work interactions
Organizational Development
 Intergroup training: an OD
technique that uses team building to
improve the work interactions of
different functions or divisions
 Organizational mirroring: an OD
technique in which a facilitator helps
two interdependent groups explore
their perceptions and relations in order
to improve their work interactions
Organizational Development
 Total organizational interventions
 Organizational confrontation
meeting: an OD technique that
brings together all of the managers
of an organization to meet to
confront the issue of whether the
organization is effectively meeting
its goals