Change & Knowledge Management-IV MBA (Module-2)

8/6/2019 Change & Knowledge Management-IV MBA (Module-2)

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CHANGE & KNOWLEDGE MANAGEMENT

IV MBA VTU - 2010

MODULE 2

Organisational Change


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Definition:

Organisational change is the process by which organisations movefrom their present state to some desired future state to increase their

effectiveness

Importanceof ange:

y Humans and organisms, grow up leaving behind the characteristics

of earlier stages of development and adopt new behaviours with age,environments and expectations.

y An organisation too cannot and should not remain constant/stagnant

all the time.

y Even if the management does not want to change, the external

pressures force it to change.

y Change encompasses leadership, motivation, organisationalenvironment, roles of people, etc.

y Change produces emotional reactions too.

y To many it is threatening, it has visions of revolutions.

y If throws up also a dissatisfied person, a trouble maker.

Recent example ofHR VP ofInfosys leaving the company (difference of

importance to seniority in promotion)


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C aracteristics of C ange:

y Vitalifa any toavoid tagnation.

y A ocessandnotanevent.

y Itisnormalandconstant.

y Isfastand is likely to increasefurther in the resentcompetitive

usiness.

y Manyatimesitisa topdownmanagementdirective.

y Sometimes it is also a mutually agreed plan for change in

variousgroupsofmanagement.

y Itisa naturaland adaptivechangeasaconsequence/reaction to

theexternalcircumstancesandpressures.

y Sometimesisan incrementalchange, step ystep.

y Sometimesitisa radicalshiftfromthecurrenttoanewprocess.

y Itisdependentupontheorganisationalenvironmentandor

culture.


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The Basic context for Organizational Change

1. What provokes Organizational change?

2. Why is Organization-wide Change Difficult to Accomplish?

3. How is Organization-wide Change best Carried out?

Nature of Organizational Change

1. Globalization of markets

2. Technological realignments3. Technological Changes

4. Changing demographics

5. Changing customer preferences

6. Organizational Restructuring


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Dimensions of Organizational change

1. Organization-wide vs Subsystem Change:

Changes due to strategy, culture and dropping a product from the list

2. Transformational vs Incremental Change

BPR vs TQM

3. Remedial vs Developmental Change

sales promotion, advts., stress mgmt sessions vs new product

development or MDPs

4. Unplanned vs Planned Change

dynamic changes in business or political environments

(Lehmann brothers, natural calamities like tsunami in japan)


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Levels of Change:

3 Levels Individual, group and organisational

a) Individual Level Change:y Change is reflected in such developments as changes in job

assignment, physical move to a different location or the change inmaturity level of a person which occurs overtime.

b) Group Level Change:y Changes at the group level can affect.

y Work flows y Job design y Social organisationy Influence the statussystems & y Communication patterns

y Formal groups, like unions, can resist change envisaged bymanagement.


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c) Organisational Level Changes:

y Changesatthislevelinvolve majorprogramsthataffect bot

individualsandgroups.

y

Decisions regarding these changes are generally made bseniormanagement.

y These decisions are rarely implemented only by a single

manger.

y They coverlong periodsoftime.

y Require considerable planningforimplementation.

y Change in the organisational level isgenerallyreferred toas

organisationaldevelopment


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Typesoforganizationalchange

1. HappenedChange:IdiaminsPolicyinUganda

2. ReactiveChange:investingintechnologies

3. AnticipatoryChange:tuninginforthefuturedemand

4. PlannedChange:M&As

5. IncrementalChange:Qualitymeasures6. OperationalChange:computerization,online&

logistics

7. StrategicChange:goinginternational

8. DirectionalChange:CRR&SLRbyRBI

9. FundamentalChange:RevampingofPSUsinIndia10.TotalChange:CETby KarnatakaGovt&UIDproject

11.TransformationalChange:Processpatenttoproduct

12.RevolutionaryChange:changeinvision&mission

13.RecreationalChange:proceduralchanges


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Forces for Change in Organisations:

y Change has become the norm in most organisations.

y The changes stem from several factors.

y Some are external, arising from outside the organisation.

y Some are internal, arising from sources within the organisation.

y Causes for change:

External Causes Internal Causes

Globalisation Organisational silence

Work force diversity Falling effectivenessTechnological change Crisis

Managing ethical behaviour Changing employee expectations

Government policies Change in the work climate

Competition ownsizingScarcity of resources eengineering

Mergers and acquisitions Productivity improvements

Pollution/Ecological controls Cycle Time eductionCalamities/Emergencies


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Resistance to Changes:


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Models of

OrganizationalChange


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Lewins three stage model of change system:

As per Kurt Lewi s Force Fiel Model effecti e change occurs by:

y Unfreezing the current situation.

y Moving to a desired condition.

y Refreezing the system so thatit remains in this desired state.

a)Unfreezing: Involves

y Shaking up the equilibrium state that maintains status quoy Encouraging individuals to discard old behaviours.

y Presenting the existing problem

y Making the people to recognise the need for change.

y Encouraging people to search for new solutions.

y Eliminating the rewards for current behaviours and discouraging

current behaviours.


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b Moving: Aims

y To shi t o alter the behaviour o individuals, departments ororganisations where the changesare totake place.

y Todevelop new behaviours, valuesandattitudes.

y To change sometimesthrough structural changes.

y To change sometimesthrough organisationaldevelopmenttechniques.

c Refreezing:

y The change becomes permanent.

y New attitudes, valuesand behavioursare establishedasthe new wayo

organisationalapproach.y The new wayofoperatingare cementedand reinforced.

y Management should ensure that the new organisational culture andrecordsystems encourage anew behaviour.

y Old waysof functioningare avoided


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d) Lewins Change Model:Unfreezing Moving Refreezing

Reducing the Developing Reinforcing

forces for new attitudes, new values

status quo values and attitudes and

behaviours behaviours

e) ransition Management:y Is between any two phases ofchange.y Managing transition is essential to keep the organisation going.y This is a process of systematically planning, organizing and

implementing change from the disassembly of the current state to the

realization of a fully functional future state within an organisation.

y In the transition state, the organisation is neither old nor new.y Still, the business must carry on.y Transition management ensures that business continues while the change

is occurring.

y An interim management structure or interim positions may be created toensure continuity andcontrol of the business during transition.

y Communication of the changes to all involved, employees, customer andsuppliers, play a great role in transition management.


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Force Field Theory of Change: - Developed by Kurt Lewin


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Force Field Diagram Managing Change

DrivingForces RestrainingForces

WeakWeak

Moderate

Strongforce

Equilibrium


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12)The Action Research Models:

y Thi od lfo us s on the l nned hangea tivit as a y lical rocess

y 8 ain steps involved in theaction research odelareexplained elo .

a) chematic diagram ofaction researchmodel:


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3)I tegrative o el of Pla e C a ge:

y Developed y Bulloc and Batten (1985)

y Describes both organisational states and changeprocesses.

y Thebasis forthis modelis thatan organisation exists in different states

at differenttimes.

y

Planned movementcan occurfrom one stateto another.y Understanding ofthepresent state ofthe organisation and theprocesses

ofchangerequired to moveto anotherstateis required.

y Modelconsists offourphases


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a) Theintegrative odelofchangeisindicatedinthesketch elow:


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4) Perspectives on hange:

y Four ajorperspectives

1. ontingency perspective focuses on structuralchange.2. Population ecology perspective looks at the limits of change and

resistanceto change.

3.Institutional perspective looks at ecoming and change through

imitation,professionalization and compliance.4.Resource dependenceperspective examines strategicchange.

a)Notion ofEnvironment:

y Theseincludes:

y Customers y Competitorsy Suppliers y Governmentalagencies

y

A societyy

An economy

Social Customs Norms Values gro th rate of inflation

Habits rate interest


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) ContingencyPerspective:y Mainlyconcerned iththe structureofanorganisation.

y Structurerefers to the ay in hichanorganisation reaks do nacomplex task into individualactivities and integrates these separate

activities toachieveits purpose.y Twocentraldimensions ofstructure-specializationandintegration.

Specialization:

y Specializationis alsoknownas divisionofla oury Organisations divided into manufacturing, marketing, accounting,

personnel, etc., are called as horizontal specialization or horizontaldivisionofla our.


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Integration:

y Refers to the various ways and means of coordinating the work ofindividuals in the organisation.

y The most common and familiar methods of integration are throughdirect supervision, rules, procedures and systems and goals, plans andtargets.

y These bring about uniformity and standardization in the activities of theorganisation.

y Without these coordination mechanisms, an organisation would beinefficient, unproductive and chaotic.

eneral:

y Both specialization and integration are factors that are within the controlof an organisations management.

y The management can determine the extent of specialization and type ofintegration required within an organisation.

y Any change in these two dimensions is called as restructuring of anorganisation.

y Organisational changes almost always involve restructuring.


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c) esource ependence erspective: by FEFEE & L N K

y Based on the simple premise that organisations need to acquireresources from the environment in order to survive.

y Pfefferand alancik profounded two strategies: internal and external.

nternal trategy:

y Internal strategies are aimed at adapting and changing the organisation

to fit the environment.y There are 7 strategies identified:

y Domain choice y Recruitment y Buffingy Environmental scanning y Smoothing y Rationingy Geographical dispersion

External Strategy:

y Are meant to alter the environment to fit the organisation.y 5 external strategies:

y Advertising y Contracting y Co-optingy Coalescing y Lobbying


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e) Institutional Perspective:y Social norms, values and culture of theenvironment in which

they operate affect organisations.

y Norms, values and culturemake up the institutional norms.

y They are also called as symbolicelements.

y Organisations change their structures and strategies not toimprove performance but to conform to the norms andstandards of the institutional environment.

y Organisations that conform to the norms and standards areconsidered as legitimate, lawful and proper.

y Such organisations are able to obtain the necessaryresources.y Organisations that lack legitimacy have difficulty in getting therequisiteresources.


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15) Understanding the change Process:

y Original change will succeed

y To the extent that individuals in the organisation, themselves

change.

y Change management requires understanding how individuals

change

y Since organisational change is based on changes in each

employee.

y Individual change tends to happenoveranextendedperiodo

time

y As individualadapt andassimilate change.

y That means that those involved in facilitating or leading

organisational change

y Must expect there will beextendedperiods ofadjustment in the

organisation.

y The watchwordis patience.


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Stepsinthe hange rocess

a) Preparation Stage

y Contact Stage

y The earlier encounter a person had with the fact that change atake place or has already taken place

y Awareness Stage

y The person knows that a change is being conte plated.

b) Acceptance Phase

yUnderstanding Stage

y The person de onstrates so e degree of co prehension of thnature and intent of the change.

y Positive perception

y The person develops a positive view toward the change


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Commitment P se

y Installation tage

y The hangeis implementedand ecomes operational

y Adoption tage

y Thechangehas een sedlongenoughtodemonstrate orth,anda isiblepositiveimpact.

y Institutionalization

y The change has a long history of orth, durability and

continuity

y And has been formally incorporated into the routineoperatingprocedures oftheorganisation

y Internalization

y Persons arehighlycommittedtochange

y Becauseitis congruent iththeirpersonalinterests,goals or

value systems.


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Resistance to Organisational Change

Som Quotes:

Resist nce is ny conduct th t serves to maintain the status quo in

the face of pressure to alterthe status quo

- Zaltman and Duncan

Resistance to change is a multifaceted phenomenon, hichintroduces unanticipated delays, costs and instabilities into the

process of strategic change

- Ansoff

Resistance is a temporaryattraction to a state of equilibrium

- Goldstein


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a)Factors causi g esistance to Change:Cause Descri tion

Fear ofthe

Unkno n

Loss of

Control

Loss of

Face

Loss ofCo petency

Need for

Security

Such fear is due to uncertai ty about the nature of

change, feeli gs that one does not kno hat is goi g

on and hatthe future holds

Feeli g that the change is bei g done to the person,

orry that one has no say i the situation and the vents

that re taki g place

Feeli g of e barrass ent as a result of change and

discerni g it i such a ay that the thi gs that one has

done i the past ere rong.

Feeli g thatthe existi g skills and co petenciesthattheperson has ill no longer be of any use afterthe change

hastaken place

orry about ones potential role after the change has

taken place


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C uDesc

ription

Poor

Timing

orce of

Habit

Lackof

Support

Lackof

Confidence

Lingering

Resentment

eeling surprised on ho the change has been

sprung on the personbeing asked to change at a

time whenone alreadyfeels overworked

eeling of comfort in the existing routines and

habits and not liking to change existing ways ofdoingthings.

Lacking the support of direct supervisors and or

organisations, not having the correct resources to

properlyimplementthe change.

Lack of confidence that once change has taken

place,things willbebetterthanbefore

eeling angrydue to a lackofrespectforthepeople

involved andorover the wayone has been treated

duringp

ast

ch

ang

e effort

s.


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OrganizationalResistance

PowerandConflicts

FunctionalDisorientation

MechanisticStructure

StructuralInertia

LimitedfocusonchangeGroupInertia

ThreattoExpertise

Threattoestablishedpower

relationshipsThreat toestablished

ResourceAllocation


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d) ReducingResistance to Change:


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MythsrelatedtoChangeManagement

1. Peoplealwaysresistchange

2. Itsallverywellforyoungstersbutolderpeoplearesetintheirways.

3. Peopledont want responsibility

4. Itsallverywellforothers,butwecouldntdothathere.

5. Bewareofsensitivewords.

6. Concentratethreebroadroles

1. Changestrategies2. Changeimplementers

3. Changerecipients


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Organi ati nal D v l pm nt:

y A ter se t e c assac llecti f la e c a e i ter e tiy Built uma istic- emocratic alues

y T at see s to improveor a isational effectivenessandemployee ell-

eing

y T e O paradigmvalues umanandorganisational growt

y Colla orativeandparticipativeprocesses

y Andaspirit ofinquiry

y T ec angeagent may bedirective in O

y However, t ere isastrongemphasisoncollaboration


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Intergroup evelopment:

y Amajor area of concernin isthe dysfunctional conflictthat

exists etweengroups

Intergroup evelopment:

y Seeks to change the attitudes, stereotypes, andperceptions that

groupshave ofeachothery There are several approachesforimprovingintergrouprelations

y Apopularmethod emphasizesproblemsolving

y Inthismethod, eachgroupmeetsindependentlytodeveloplists

ofitsperceptionofitself

y The othergroup, andhowitbelievesthe othergroupperceivesit.

y The groups then share their lists, after which similarities anddifferences are discussed

y Differences are clearly articulated, and the groups look for the

causesofthe disparities.


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TypesofInterventions

1. StructuralInterventions

1. StructuralReorganization,

Eg:

HP,

SBUS,

MNCs

etc2. NewRewardSystems:PayforPerformance

3. ChangingorganizationalCulture:decentralization

2.Task-TechnologyInterventions

AppreciativeInquiry:reframingrelationshipsaroundthe

positiveandthepossibleoutcomes.Movingfromproblem

centerednesstodevelopmentcenteredness.

Four-DModel:Discovery,Dreaming,Design,Delivering

Sociotechnical systems

Qualityofworklife

JobRedesign

3.PeoplefocusedInterventions

SensitivityTraining

SurveyFeedback

ProcessConsultation

Teambuilding

IntergroupDevelopment

GridOD

Documents

Change & Knowledge Management-IV MBA (Module-2)