Organizational Change Organizational change is the process by
Organizational Change Ø Organizational change is the process by which organization move from their present state to some desired future state to increase effectiveness. Ø When an organization system is disturbed by some internal or external forces change frequently occurs or it may be the result of any alteration which occurs in the overall work environment of an organization. 14 -1
CHARACTERSTICS OF O. C. v Change happen for the pressure of both internal and external forces in the organization. v Change in any part of the organization affect the whole organization. v Change may affect people , structure, technology, and other element of the organization. v Change also affect the rate of speed and degree of significance of the organization. v Change may be reactive or proactive. 14 -2
Change Forces INTETRNAL FORCES §Work force §Managerial personnel §Management structure §Avoid developing inertia External Forces Change forces §Technology §Marketing conditions §Social changes §Political forces 14 -3
Internal Pressures for Change Work force Avoid developing inertia Managerial personnel Management structure 14 -4
External Pressures for Change Technological advances Political Forces Marketing conditions Social changes 14 -5
Managerial Advice Companies’ Responses to Pressures for “Green” Policies and Practices Taking as it positive way: ØIt create a healthy image in customers. ØIt help in cost cutting. ØEnergy saving in the office. ØHelp in reducing carbon in environment. 14 -6
Levels of change • Individual: transfer, change in job assignment & maturity • Group: resistance from trade union, influence of informal group- work flow, social org, communication pattern, status system Organisational: • ü strategic: accommodation of global culture ü structural: decentralisation, flat structure ü process: technological development, automation, information processing, retraining personnel's ü people : performance improvement, group cohesion, dedication, loyalty 14 -7
Change Agents • A Persons in organization responsible for managing change activities. • Can be managers or non managers, current employees, newly hired employees or outside consultants. 14 -8
PLANNED CHANGE 14 -9
Managing planned change • Planning for change • Assessing change forces • Implementing the change 14 -10
Planning • Develop new goals and objectives • Select change agent • Diagnose problem • Select change methodology • Develop plan • Strategy for implementation 14 -11
Assessing change forces 14 -12
Force Field Analysis: Driving Forces • Driving Forces are forces that push in a direction that causes change to occur. • They cause a shift in the equilibrium towards change. 14 -13
Force Field Analysis: Restraining Forces • Restraining forces are forces that counter driving forces. They oppose change. • Restraining forces cause a shift in the equilibrium which opposes change 14 -14
Force Field Analysis: Equilibrium q. Equilibrium is a state of being where driving forces equal restraining forces and no change occurs. q. Equilibrium can be raised or lowered by changes that occur between the driving and restraining forces. 14 -15
• Kurt Lewin proposed that whenever driving forces are stronger than restraining forces, the status quo or equilibrium will change. Successful change is achieved by either strengthening the driving forces or weakening the restraining forces. 14 -16
Process of Planned Change Kurt Lewin Unfreezing • Provide rationale Moving • Provide information for change • Create minor levels • of guilt/anxiety about not changing Create sense of psychological safety concerning change • that suspects proposed changes Bring about actual shifts in behavior Refreezing • Implement new evaluation systems • Implement new hiring and promotion systems 14 -17
Coca-Cola Is Finding a New Fizz Experiencing Strategic OB Neville Isdell Sandy Douglas Coca-Cola is changing its culture, and also enhance its product line to better satisfy the demand of customers. 14 -18
Speed of Change Urgency Degree of support Criteria to Consider Amount and complexity of change Competitive environment Knowledge and skills available Financial and other resources 14 -19
Resistance to Change Effort to block new ways of doing things Three Factors Individual Resistance Group Resistance Organizational Resistance 14 -20
Individual Resistance • Below are stated some reasons why people resists changes. Some of these appear to be rational or emotional. These reasons are: • Economic factors • Habits • Insecurity • Lack of communication • Extend of change • Psychological factors • Social factors 14 -21
Group Resistance Most organizational changes have impact on formal groups in the organization the main reason why the groups resists change is that they fear that their cohesiveness or existence is threatened by it. 14 -22
Organizational Resistance Organizational resistance means the change is resisted at the level of the organization itself. Some organization are so designed that they resist new ideas, this is specifically true in case of organization which are conservative in nature. Majority of the business firm are also resistance to changes. The major reason for organizational resistance are: • Threat to power • Group inertia • Organizational structure • Threat to specialization • Resource constraints 14 -23 • Sunk costs
Minimizing Resistance to Change Communication • Highest priority and first strategy for change • Improves urgency to change • Reduces uncertainty (fear of unknown) • Problems -- time consuming and costly 14 -24
Minimizing Resistance to Change Communication • Provides new knowledge and skills Training • Includes coaching and action learning • Helps break old routines and adopt new roles • Problems -- potentially time consuming and costly 14 -25
Minimizing Resistance to Change Communication • Increases ownership of change Training Employee Involvement • Helps saving face and reducing fear of unknown • Includes task forces, search conferences • Problems -- time- consuming, potential conflict 14 -26
Minimizing Resistance to Change Communication Training Employee Involvement Stress Management • When communication, training, and involvement do not resolve stress • Potential benefits • More motivation to change • Less fear of unknown • Fewer direct costs • Problems -- time- consuming, expensive, doesn’t help everyone 14 -27
Minimizing Resistance to Change Communication Training Employee Involvement Stress Management Negotiation • When people clearly lose something and won’t otherwise support change • Influence by exchange-reduces direct costs • Problems • Expensive • Increases compliance, not commitment 14 -28
Minimizing Resistance to Change Communication Training Employee Involvement Stress Management Negotiation Coercion • When all else fails • Assertive influence • Firing people -- radical form of “unlearning” • Problems • Reduces trust • May create more subtle resistance 14 -29
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