Organisational Change

7/21/2019 Organisational Change

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CHANGE IS THE ONLYTHING THAT WILL

NEVER CHANGE. SOBETTER ADAPT TO IT.

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Change is any alterationoccurring in the workenvironment that affects the

ways in which employees mustact.

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Coping process of moving from aunsatisfactory present state to adesired state.

Individuals, teams and organizationsthat recognize the inevitability ofchange, learn to adapt to it, and

attempt to manage it, will be the mostsuccessful.

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Change management is a setof processes employed toensure that significant

changes are implemented ina controlled and systematicmanner.

Achieving sustainable change begins

with a clear understanding of thecurrent state of the organization,followed by the implementation ofappropriate and targeted strategies.

The focus of change management ison the outcome the change willproduce – the NEW arrangementsthat must be understood.

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Organizations tend to achieve an equilibriumin their social structure. When changecomes along, it requires employees to make

new adjustments as the organization seeks anew equilibrium.

Disequilibrium occurs when employees are

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Is there any difference betweenchange and transition?

The difference between change and transition is like

the difference between external andinternal . Change is the external world around you.Transition as the internal process through which youcome to terms with the change.

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All changes are likely to have some costs.Because of costs, proposals for changeare not always desirable. Each changerequires a detailed cost-benefit analysis.

If changes doesn’t provide benefits abovecosts, there is no reason for thechanges.These cost s are not merely economic;they also are psychological and social. Allof these costs must be considered indetermination of benefits and costs.The organizational goal always is benefitsgreater than costs.

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Psychological costs also arecalled Psychic costs becausethey affect a person’s inner

self, the Psyche. Knowledge of individual

differences helps us predictthat people will react in widelyvarying ways to change. Somewill perceive only the benefits,while others see only what itcosts them.

In some cases the psychic costsof change can be so severethat they affect the

psychological and even physicalhealth of employees.

The reality of change is thatfrequently there is no clear-cut100 percent benefit for all

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Forces for Organizational

Change



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Technology

Cont……



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Cont……

Change inManagerialPersonnel

Deficiencyin Existingorganization

Nature

of theworkforce

To avoiddevelopinginertia



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External forces

Change that results from the adoption of newtechnology is common in most organizations and while itcan be disruptive at first, ultimately the change tendsto increase productivity and service Technology also has

affected how we communicate.Today's burgeoning communication technologyrepresents changes that allow organizations to learnmore, more quickly, than ever before.When there is a change in technology in theorganizational environment and other organizations

adopt the new technology, the organizations underfocus become less cost effective and its competitiveposition weakens.Therefore, it has to adopt new technology, its workstructure is affected and a new equilibrium has to beestablished.

1.TECHNOLOGY



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External forces

– As the world evolves, customer needs change and grow, creating new demand fornew types of products and services -- and opening up new areas of opportunity for

companies to meet those needs. – Since every organization exports its outputs to the environment, an organization

has to face competition in the market.

– There may be two types of forces which may affect the competitive position of anorganization –other organizations supplying the same products and, buyers who arenot buying the product. Any changes in these forces may require suitable changesin the in the organization.

– For example, when Indian economy was liberalized, there were many foreignorganizations that entered the Indian market. This forced many Indianorganizations to realign themselves with the new situations. The result in thatthere have been many cases of divesting the business and concentrating on thecore business, acquiring core business, and developing competitive competence toface competitive threats.

– Similarly, there may be changes in buyers in terms of their needs, liking –disliking

and income disposal for a product. These changes from the organizations to bringthose products which meet buyer’s requirement.

2.Customer Needs/ Market Needs



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External forces

The economy can impact organizations in both positive and negative ways anboth can be stressful.A strong economy and increasing demand for products and services will meanthat companies must consider expansion that might involve the addition ofstaff and new facilities.These changes offer opportunities for staff, but also represent newchallenges.A weak economy can create even more problems as companies find themselv needing to make difficult decisions that can impact employees' salaries andbenefits and even threaten their jobs.The ability to manage both ends of the spectrum are critical fororganizations that want to maintain a strong brand and strong relationshipswith customers as well as employees.

Social changes reflect in terms of people’s aspirations, the needs, and theirways of working. Social changes have taken place because of the severalforces like level of education, urbanization, feeling of autonomy, andinternational impact due to new information sources.These social changes affect the behavior of people in the organization.

There, it is required to make adjustment in its working so that it matcheswith people.

3. The Economy



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External forces

Political and legal factors broadlydefine the activities which anorganization can undertake and themethods which will be followed by it

in accomplishing those activities.Any changes in these political andlegal factors may affect theorganization operation.

4. Political and legal changes



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External forces

Change is important in organizations to allow employees to learnnew skills, explore new opportunities and exercise their creativityin ways that ultimately benefit the organization through new ideasand increased commitment.Preparing employees to deal with these changes involves ananalysis of the tools and training required to help them learn new

skills.Training can be provided through traditional classroom settings or,increasingly, through online learning opportunities. Importantly,organizations need to do a good job of evaluating employees'capabilities and then taking steps to fill the gaps between currentskills and the skills required to respond to growth.

5. Growth Opportunities



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Internal forces

Besides environmental changes there is a changein managerial personnel. Old managers arereplaced by new mangers, which necessitatedbecause of retirement, promotion, transfer ordismissal.Each new manager brings his own ideas and wayof working in the organization.The relationships, more particularly informal

ones, changes because of changes in managerialpersonnel.Moreover, attitude of the personnel changeeven though there is no changes in them. Theresult in that an organization has to changeaccordingly.

1.Changes in the managerial personnel



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Internal forces

Sometimes, changes are necessary because of deficiency in the present

organizational arrangement ad process.These deficiencies may be in the form of unmanageable span ofmanagement, large number of managerial levels, lack in co-ordinationbetween various departments, obstacles in communication, multiplicity ofcommittees, lack of uniformity in policy decisions, lack of cooperationbetween the line and staff, and so on.Beside these internal factors, there are two more internal factors that giverise to organizational changes.

2.Deficiency in Existing organization



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Internal forces

The nature of work force has changedover a passage of time. Different workvalues have been expressed by differentgenerations.The profile of the workforce is alsochanging fast.

The behavior has also become verycomplex and leading them towardsorganizational goals is a challenge for themanagers.The employee turnover is also very highwhich again put strain on the

management.

3.Nature of the work force



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Internal forces

In many cases, organizational changes take place just to avoid developing inertia or inflexibility.

Conscious manager take into account this view oforganization that organization should be dynamicbecause any single method is not the best tool of

management every time.

Thus, changes are incorporated so that thepersonnel develop liking for change and there isno unnecessary resistance when major change inthe organization are brought about.

4.To avoid developing inertia



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(C)

Types of organizationalchanges



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1. Individual Level2.Group Level

3.Organisational Level



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Individual level changes may take place due tochanges in job assignment, transfer of anemployee to a different location or thechanges in the maturity level of a person whichoccurs over a passage of time.The general opinion is that change at theindividual will not have the significantimplications for the organization. But this isnot correct because individual level changeswill have impact on the group which in turn willinfluence the whole organization.Therefore, a manager should never treat theemployees in isolation but he must understand

that the individual level change will haverepercussions beyond the individual.

1. Individual Level Change

2 G L l Ch



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Management must consider group factors whileimplementing any change, because most of theorganizational changes have their major effects at

the group level.The groups in the organization can be formal groupsor informal groups. Formal groups can always resistchange for example; the trade unions can verystrongly resist the changes proposed by themanagement. Informal groups can pose a major

barrier to change because of the inherent strengththey contain.Changes at the group level can affect the workflows, job design, social organization, influence andstatus systems and communication patterns.The groups, particularly the informal groups have alot of influence on the individual members of thegroup. As such by effective implementing change atthe group level, resistance at the individual levelcan be frequently overcome.

2.Group Level Change



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The organizational change involves major programmes whichaffect both the individuals and the groups.Decisions regarding such changes are made by the seniormanagement. These changes occur over long periods of timeand require considerable planning for implementation.A few different types of organization level changes are:

3.Organizational Level Change



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1.Strategic change.

Strategic change is the change inthe very basic objectives ormission of the organization. Asimple objective may have to bechanged to multiple objectives.For example, a lot of Indian

companies are being modified toaccommodate various aspects ofglobal culture brought in by themultinational or transnationalcorporations.

2 St t l h



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Organizational structure is the pattern of relationships among variouspositions and among various position holders. Structural change involves

changing the internal structure of the organization. This change may be inthe whole set of relationships, work assignments and authority structure.Change in organization structure is required because old relationships andinteractions no longer remain valid and useful in the changedcircumstances.

2.Structural change.



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These changes relate to the recent technologicaldevelopments, information processing andautomation. This will involve replacing or retraining

personnel, heavy capital equipment investment andoperational changes. All this will affect theorganizational culture and as a result the behaviorpattern of the individuals.

3.Process oriented change.

4 P l i t d h



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People oriented changes are directed towardsperformance improvement, group cohesion,dedication, and loyalty to the organizations as

well as developing a sense of self-actualizationamong members. This can be made possible bycloser interaction with employees and by specialbehavioral training and modification sessions.

4.People oriented change.

To conclude, we can saythat changes at any levelaffect the other levels. Thestrength of the effect willdepend on the level orsource of change



Models Of Organizational Change

• Lewins Model of Change

• System Model of Change

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“.….the only constant is change ;

change is inevitable”

(D) Resistance to Change



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Resistance to change consists of any employeebehaviors designed to discredit, delay, orprevent the implementation of a work change.

Employees resist change because it threatenstheir needs for :

• Security•

Social Interaction• Status• Competence• Self-Esteem



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Despite of the nature of the change, some

employee try to protect themselves from itseffect. Their action may range from complaints,foot-dragging, and passive resistance toabsenteeism, sabotage, and work slowdowns.

All employees tend to resist it because of thepsychic costs that accompany it and alsomanagers resist it too.

Although people tend to resist change, thistendency is offset by their desire for newexperiences and for the rewards that come withchanges.

Nature and Effects

One lesson for management is that a change is likely to be



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g g yeither a success or problem, depending on how skillfully it ismanaged to minimize resistance.

Insecurity and change are conditions that illustrate how a

chain-reaction effect may develop in organizational behavior.

A chain-reaction effect is a situation in which a change ,orother condition, that directly one person or a few personsmay lead to a direct or indirect reaction from many people

because of their mutual interest in it.

Reasons for Resistance



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Employees may resist changes for three broad reasons: They may not feel comfortable with the nature of the change it self.

It may violate their belief system, they may believe the decision istechnically incorrect, or they my simply be reluctant exchange comfortof certainty and familiarity for uncertainty.

The method by which change is introduced. People may resent havingbeen ill-informed, or they may reject an insensitive and authoritarianapproach that did not involve them in the change process.

The inequity experienced when people perceive themselves beingchanged while someone else appear to gain the benefits of the change.

Their resistance will be even more intense if all three reasons exist .

Reasons for Resistance

Type of Resistance



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There are three different types of resistance to change.

Logical Resistance.( or Rational Resistance) This is based on

disagreement with facts, rational reasoning, logic, and science. Itoccurs because of the time and efforts which is needed to adjust tochange.

Psychological Resistance.( or Emotional Resistance ) This is typicallybased on emotions, sentiments, and attitudes. It is internally logical

from the perspective of the employees’ attitudes and feelings aboutchange because they may fear the unknown, mistrust the management’s leadership, or feel that their security and self-esteem are threatened.

Sociological Resistance.( or Social Resistance) Sociological resistancealso is logical, when it is seen as a product of a challenge to groupinterests, norms, and values.

Type of Resistance

Implic ti ns f R sist nc



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All three types of resistance mustbe anticipated and treatedeffectively if employees are toaccept change cooperatively. Ifadministrators work with only one of

them they will fail to made change.

In a typical operating situation fullsupport can’t be gained for everychange that is made. What managerseeks is climate in which people

trust managers, have a positivefeeling toward most changes, andfeel secure enough to tolerate otherchanges.

If management can’t win support, itmay need to use authority.

Implications of Resistance



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Possible Benefits of Resistance



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Encourage management to reexamine itschange proposals.

Help to Identify specific problem areaswhere a change is likely to causedifficulties.

Management may be encouraged to do abetter job of communicating the change.

Gives managers information about theintensity of employee emotions on an

issue.

Encourage employees to think and talkmore about a change.

Possible Benefits of Resistance Resistance is not all bad. It can bring some benefits as follows:

I l ti Ch S f ll



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Some changes originate within theorganization, but many come fromthe external environment. For

example Government passes laws,new development in technologyarise, competitors introduce newservices and etc. then theorganization should respond tothem.

Although stable environment meanless change, dynamic environmentsare now the norm, and they requiremore change.

Transformational Leadershipand Change

Management has key role ininitiating and implementing changesuccessfully.

Implementing Change Successfully

C t



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Not only do managers sometimes overlooksimple but important details, but they

may fail to develop a master strategy forplanned change. An overall plan shouldaddress Behavioral issues, such asemployees’ difficulty in letting go of oldmethods and the general need to createan organization to welcomes change.

Transformational Leaders areinstrumental in this process. They aremanagers who initiate bold strategicchanges to position the organization forits future.

Cont….

There are three important elements of transformational leadership :C ti Vi i C i ti h i d ti l ti l i



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Creating Vision. Transformational leaderscreate and communicate a vision for theorganization. A vision crystallized long-range

image or idea of what can and should beaccomplished. A vision may also integrate theshared beliefs and values that serve as abasis for changing an organization’s culture.

Communicating Charisma. Leaders

should persuade employees that thevision is urgent and motivate them toachieve it. Charisma is a leadershipcharacteristic that can help influenceemployees to take early and sustainedaction. Charismatic leaders are

dynamic risk takers, they can be warmmentors who treats employeesindividually and guide them to takeaction, and also they need torecognize the “emotional vulnerability”that employees experience.

Stimulating Learning. The critical Task

for transformational leaders is todevelop people’s capacity to learn fromthe experience of change. Thisprocess is called double-loop learningwhich means that the way a change ishandled should not only reflect current

information gathered but also preparethe participations to manage futurechanges even more effectively. Thisprocess is in sharp contrast to single-loop learning which is just focus oncurrent problems.

Creating Vision, Communicating charisma, and stimulating learning.



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(E)Building Support for Change



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1. Use of Group Forces:

Effective change focuses on both

individuals and groups. Any changes in group forces will

encourage changes in individual behavior. The more attractive the group is to each

member, the greater its influence on agroup member can be. If a member with

high status support the change theinfluence will increase.

If the change disrupt the group’s socialsystem more than necessary, the groupwill tend to meet resistance.

2 Providing a Rationale for



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2.Providing a Rationale forChange.

Capable leadership reinforces a climate ofpsychological support for change.

It is generally better to provide objectivereasons for the change.

Ordinary requests of change should be in accordwith the objectives and vision of the organization.

Managerial and employee expectations of changemay be as important as the technology of change,but expectations are not enough alone.

By believing that the change will work, themanager acts so as to fulfill that belief. Thisbelief is transferred to employees, who buy intoprobability of success and change their behavior

accordingly.

3 P ti i ti



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3. Participation.

A fundamental way to build support forchange is through participation.

Participation encourage commitmentrather than mere compliance withchange.

As participation increases, resistanceto change tend to decrease.

Employees want to involved andparticipate from the beginning to

protect themselves from changessurprises.



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4.Shared rewards.

Another way to build employeesupport for the change is to makesure that there are enough rewardsfor them in the change situation.

Rewards give employees a sensethat progress accompanies a changeand also tell them that we careabout you and wants you as well as

us benefit from this change.

Also it is desirable for a change topay off as directly and as soon aspossible.



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5. Employee security.

Along with shared rewards, existing employee

benefits need to be protected and that’s whysecurity during a change is very important.

For this reason many employers guaranteeworkers protection from reduced earnings whennew technology and methods are introduced, or

some offer retraining and delay installation oflabor-saving equipment.

Grievance systems give employees a feeling ofsecurity that benefits will be protected anddifferences about them fairly resolved.

6 Communication and Education



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6.Communication and Education.

Communication is essential in gaining support for change.

When a change occur all of a group members shouldinformed even it affects only a few of them.

Since the flow of information may be weakest at thetime it is needed most, special effort is required tomaintain it in times of change.

7 Stimulating Employee Readiness



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7.Stimulating Employee Readiness.

Change is more likely to be accepted if the peopleaffected by it recognize a need for it before it occurs.

This awareness can happen both naturally or it can beinduced by management.

One of the more powerful way is when Workers discoverfor themselves that a situation requires improvement.

8 Working with the Total System



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8. Working with the Total System.

Resistance to change can be reduced by a broaderunderstanding of employee attitudes and natural reactions

to change.

It is essential for the managers to take a broader,system-oriented perspective on change to identify thecomplex relationship involved.

Organization development can be a useful method forachieving this objective.



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Organisational Change