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Strategy selection options are relative, based on the environmental system being scanned, how they are scanned, and their relation to the business performing the scanning. Therefore, what may seem to be a positive factor of influence for one business organisation may be a negative one for another. The contextual environment can hold either opportunities or threats, as the relativity is embedded in a combination of environmental impact, the type of business, and strategic fit of the selected strategy. There must therefore be room for flexibility in design.
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Strategic Change ManagementSession 1
Dr. Steyn Heckroodtwith permission from
Dr. Indranil Bose
Strictly Private & Confidential.Unauthorized use of the contents, information and materials is
prohibited
What is Organizational Change?
– It is generally considered to be an organization-wide change, as opposed to smaller changes such as adding a new person.
– It includes the management of changes to the Product, Process and people through the organizational lifecycle ( The creativity stage, direction setting stage, decentralization stage, coordination stage and collaboration stage).
i) Product: New Product, Improvement in existing product etc.ii) Process: Physical Environment, Hierarchies/reporting
relationships.III) People: Culture, job design / responsibilities, staff skills /
knowledge and policies / procedures.
CHANGE MANAGEMENT CONTEXT
Dominant attribute
QualityPrice
Variety and Range
Convenience
© Dr . Steyn Heckroodt
Demand
3Source: Amended from Heckroodt, S. Strategic Thinking – GAME OVER. Epubsa.co.za
PROCESSES
CEO
Outward directed Concerned with product and/or service deliveryMain purpose of business
Source: Amended from Dostal, E. Biomatrix – A Systems Approach to Organisational and Societal Change. Sun Press.
Inward directedLine function and specializationConcerned with resource allocation
Self directedConcerned with maintaining the organisation as a entity
© Dr . Steyn Heckroodt
4
Core
bus
ines
spr
oces
ses
Organisa
tional
support
processe
s
Business support processes
Source: Amended from Unilever Institute for Marketing Research and Management
Session 2: Planning
Session 1: Business Environment
Organisational Life Cycles
•Organisation exists only as an idea•The idea is focused on the founder's conception of the product or service.
Source: Amended from Unilever Institute for Marketing Research and Management
•Vulnerable and in need of constant care and attention to keep it going•Nature is transformed from that of an idea to that of action
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Confidence of the founder grows•Explores every opportunity•Too many priorities result in no priorities•The energy of the founder no longer sufficient•Founder trap
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Reborn apart from its founder•Transition to delegation and professional management is often painful
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•The optimal point in the lifecycle curve•Achieving a balance of control and flexibility•Not at the top yet•Still has room to grow•Limited by ability to attract and train enough skilled people
Organisational Life Cycles
•The beginning of the Aging process•Starting to lose flexibility, creativity and innovation•Finance department importance relative to that of the Marketing or Research departments increases•(ROI) becomes the dominant measurement
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Form supercedes function•Focused on how things get done•Organisational protocol and tradition dominate•Challenges to the status quo are frowned upon•Innovation stifled•Cash rich, making it prone to acquire or to be acquired
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Characterized by witch-hunting•Writing is on the wall and each area seeks evidence that some other area is to blame•Energy is spent on in-fighting and the customer is seen as a nuisance.
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Bureaucracy supports its continued existence•Internal systems acquire a life of their own•Dissociated with its original purpose•Artificial life-support systems are required to keep the organisation from its ultimate death•May survive for a long time in a protracted coma
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
•Death occurs as commitment to the organisation dissipates. Clients desert the organisation, followed by employees, until nothing remains.
Source: Amended from Unilever Institute for Marketing Research and Management
Organisational Life Cycles
Evolution of OrganizationStage Priorities
Creativity Entering the business and highly centralized control
Direction setting Separate functional areas and departments are created, however, centralization still remains the issue
Decentralization Possibilities of acquisition, more decentralization in practical sense
Coordination Coordination between centralization and decentralization, profit centre concepts are introduced in a big way
Collaboration Formalization to informalization etc.
Source: Larry E. Greiner, 1999
Types of forces leading to change
Dramatic Change Fostered by Top Management
Creativity, direction setting and decentralisation stage
Systematic change Initiated by consultants and staff people
Decentralisation, coordination stage
Organic Change Initiated by people at the grass roots level at the organization
Coordination and collaboration stage
Examples of Successful Organizational Change
• General Electric-1-2 principle (Jack Welch)(Dramatic Change)
• Xerox-process improvement (David T. Kearns) (Systematic Change)
• HP-innovation and break through projects (Carly Fiorina) (Dramatic Change)
• 3M-Organic Change (Employees, encouraged by William L. McKnight, Founder)
• Manchester United-Alex Ferguson
Contexts of Organizational and Business Change
• Workforce demographics
• Technological advances
• Social trends
• Changes in ownership and leadership
• Natural shocks/ calamities
• Political ramifications and government regulations
• Change in the competitive scenario
Principles of Change Management
• Agreeableness and participation centric• Understanding of the current positioning and
future accomplishments• Based on SMART principle (Specific,
Measurable, Achievable/Attainable, Realistic, Time-bound
When you say Change, they say?????
“This is a waste of time.”
“Why change if it was working just fine before?”
“If it ain't broke, don't fix it.”
“They never tell us what’s going on!”
“How soon will this happen?”
“How will this impact me?”
“Will I receive new training?”
“What’s in it for me.”
“I doubt they are really serious about this.” Natural reaction to change: Resist
Awareness of need to change: critical ingredient and must come first
However a proper strategy can yield result…….
• Stage 1: Denial, fear and stiff resistance• Stage 2: Sadness (slight improvement)• Stage 3: Acceptance (Significant improvement)• Stage 4: Relief, liking, participation
Source: Heningham(2011)
Direct outcomes of change…….
• Superior performance – top down, bottom up• Improve quality – TQ movement• For customers – delight, win-win• For competitive advantage – not standing still• For energised, committed workforce– Act in the interests of the whole organisation– Encourage self-awareness across the organisation
• To help people embrace change
Thanks……………
ANY QUESTION????????
