Chapter 2 Images of Managing Change Learning Objectives

Chapter 2 Images of Managing Change

Learning Objectives • Understand the importance of organizational images and mental models. • Identify different images of managing and of change outcomes. • Outline six different images of managing change. • Identify theoretical underpinnings of these six change management images. • Understand the practical implications of the six images and how to use them.

Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Controlling… ◦ Top-down view of management ◦ Fayol’s theory of management: planning, organizing, commanding, coordinating and controlling. Shaping… ◦ Participative style of management ◦ Improving the capabilities of people within the organization

Images of Change Outcomes Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Intended Change: ◦ Change is a result of planned action Partially Intended Change: ◦ Change may need to be re-modified after it is initially implemented Unintended Change: ◦ Forces beyond the control of the change manager

Images of Change Managers Images of Managing Change Images of Managing Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Intended Images of Partially Change Intended Outcomes Unintended Controlling. . . (activities) Shaping. . . (capabilities) DIRECTOR COACH NAVIGATOR INTERPRETER CARETAKER NURTURER

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Coach Director § Relies upon building § Based on an in the right set of image of values, skills and management as “drills” that are control and of deemed to be the change outcomes best ones to be as being drawn upon in order achievable. to achieve desired § Supported by the n organizational -step models and outcomes. contingency theory. § Related to OD approaches.

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Interpreter Navigator § The manager § Control is the heart of creates meaning for management action, other organizational although a variety of external factors mean that members, helping them to make sense managers may achieve of various some intended change organizational outcomes and others will events and actions. occur over which they have little control. § Supported by the sense-making § Supported by theory of contextualist and organizational processual theories of change.

Images of Change Managers Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images Nurturer Caretaker § The manager’s control § Even small changes may is severely impeded by have a large impact on organizations and a variety of internal managers are not able to and external forces control the outcome of beyond their scope. these changes but may The caretaker nurture their organizations. shepherds their This facilitates organizations along as organizational qualities best they can. that enable positive self§ Supported by lifeorganizing to occur. cycle, population§ Related to chaos and ecology and Confucian/ Taoist theories. institutional theories.

Three Core Uses of the Images of Managing Change Images of Change Outcomes Images of Change Managers: -Director -Coach -Navigator -Interpreter -Caretaker -Nurturer Three Core Uses of the Images These six images of change managers have three core uses: 1) They highlight a variety of assumptions that change managers make about change and increase the awareness of different interpretations of change. 2) They draw attention to the dominant images of change within an organization. 3) They highlight a range of perspectives available to change managers.

Table 2. 5 Chapter Reflections for the Practicing Change Manager

Chapter 3 Why Organizations Change

Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper- competition -Reputation & credibility Role of the Environment Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political Change is a risky activity – many organizational changes fail or do not realize their intended outcomes. This raises the question: why is change so prevalent? Pressure to change comes from: ◦ External, environmental pressures ◦ Internal, organizational pressures

Environmental Pressures Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper- competition -Reputation & credibility Role of the Environment Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political Pressure Examples Description Neo-institutionalism: mimetic isomorphism. Managers imitate Fashion Boeing Co. practices associated with successful pressures organizations Mandated pressures Geopolitica l pressures Chevron Texaco 3 M Neo-institutionalism: coercive isomorphism. An organization changes through formally or informally mandated requirements. Macroeconomic changes (or crises) place pressure on organizations to change the way they operate.

Environmental Pressures Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper- competition -Reputation & credibility Role of the Environment Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political Pressure Examples Description Market decline pressures AOL Time Warner When current markets begin to decline there is pressure to find newer, more viable markets. Gateway The highly intensified rate of business – including shortened product life cycles and rapid responses by competitors – produces pressure for change at the organizational level. Walt Disney Company In light of recent corporate governance scandals, the pressure to maintain a good reputation and high level of credibility has increased. Hypercompetition pressures Reputation and credibility pressures

Debate: Role of the Environment Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper-competition -Reputation & credibility ◦ whether external pressures facilitate or inhibit the process of change. Environment as an objective entity vs. environment as a cognitive construction ◦ The former treats the environment as an objective entity to which managers must respond. The latter emphasizes the centrality of managers’ interpretations of environmental conditions as the key determinant of behavior. Role of the Environment Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political Organizational learning vs. threat-rigidity Forces for change vs. forces for stability: ◦ External forces can vary; they either promote change or promote stability. Bridging (adapting) vs buffering (shielding): ◦ These represent either strategies that can maintain effectiveness by adapting parts of the organization to changes happening in the outside environment (bridging) or focusing on efficiency by avoiding change through shielding parts of it from the effects of the environment (buffering).

Internal Pressures Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper-competition -Reputation & credibility Role of the Environment Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political Pressure Growth pressures Integration and collaboration pressures Identity pressures Examples Description Microsoft Existing systems and processes in an organization may no longer be applicable when the size of the organization increases. EDS Integration and creating economies of scale can lead to pressure for change in organizations. Forte Hotel A common organizational identity and the unified commitment of staff in different areas/departments of an organization can be difficult to manage and may encourage change.

Internal Pressures Why Change? External Pressures -Fashion -Mandated -Geopolitical -Market decline -Hyper-competition -Reputation & credibility Role of the Environment Pressure Examples Description New broom pressures Bank of America Change at the senior management level – particularly of CEO - can often be a catalyst for significant changes in an organization. Power and political pressures Morgan Stanley Power relationships and politicking can change internal processes and decision making. Internal Pressures -Growth -Integration & collaboration -Identity -New broom -Power & political

Exercise 3. 2 Public Change Rationales

More on the why of change…

Theories of Organizational Change • Life cycle theories: linear and irreversible sequence of prescribed change • Organizations go through different stages: birth, youth, midlife, maturity, …. When reached maturity, revitalization is needed. • Teleological theories: recurrent and discontinuous sequence of goal setting, implementation, and adaptation • Dialectic theories: recurrent and discontinuous sequence of confrontation, conflict, and synthesis • Evolutionary theories: recurrent, cumulative and probabilistic sequence of variation, selection, and retention

Economic Pressures • globalization: Deregulation, opening of national economies • Unpredictable and Rapidly changing markets • Service and knowledge base business • profitability based on machine power to profitability based on intelligence and skills

Social Pressures • • Flexible working arrangements Women in management Educated workforce/society Demographics Immigrations People more independent, questioning Lack of loyalty between the workers and companies

Technological Pressures • Information and Communication Technology • • • High performance work systems Integrated information systems Access to information Global networking New media • Shortening product life cycles • High quality

Sustainable Development Pressures SD Elements: Social 1. Employee Well-Being 2. Quality of Life 3. Business Ethics Economic 4. Shareholder Value Creation 5. Economic Development Environmental 6. Environmental Impact Minimization 7. Natural Resource Protection

Organizational Self-renewal • Challenging old assumptions • Understanding the new rules of competition • Capturing the potential of new paradigms by rethinking business processes • Constant innovation • Improving continually as part of normal functioning • Transforming while keeping purpose and direction èContinuous learning

Organic type of organizations, adopted to unstable conditions • continual new and unfamiliar problems cannot be broken down and distributed among the existing specialists roles • continual adjustment and redefinition of individual tasks is needed • Interactions and communication may occur at any level as required by the process • organization charts are not always useful

Emerging Mindset • Industrial mindset: • Invalidity of the internal reality of human consciousness • Scarcity of resources • Separate parts • Discrete events • emerging mindset: • • Consciousness is causative Abundance Relationships and Wholeness Continuous Process parts are connected and they are connected to the whole, change is a continuous process, and the internal and external dynamics are both important.