Chapter 17

Organizational Change

Jim Harrell and Elson Mills

Organizational Change

Organizational Change is going to happen whether we like it or not.

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Lewin’s force field Analysis Model

Unfreezing

•The first part of the change process whereby the change agent produces disequilibrium between the driving and restraining forces.

Refreezing

•The latter part of the change process in which systems and conditions are introduced that reinforce and maintain the desired behaviors

Resistance to Change

• According to various surveys, more than 40 percent of executives identify employee resistance as the most important barrier to corporate restructuring or improved performance.

Reasons for Resistance to Change

• Direct Costs– People tend to block actions that result in higher direct costs or lower benefits

that the situation they’re currently in.

• Saving Face– Change is resisted as a political strategy to “prove” that the decision in wrong or

that the person encouraging change is incompetent.

• Fear of the Unknown– People resist change out of worry that they cannot adjust to the new work

requirements.

• Breaking routines– People are creatures of habit. They like to stay within comfort zones.

• Incongruent organizational system– Rewards, selection, training, and other control systems ensure that employees

maintain desired role patterns

• Incongruent team dynamics– Team develop and enforce conformity to a set of norms that guide behavior.

Urgency for Change

• The change process must begin by ensuring that employees feel an urgency to change; this occurs by informing them about competitors, changing consumer trends, impeding government regulations, and other driving forces.

Customer-Driven Change

- Putting employees in direct contact with customers.

Urging Change without External Forces

- Creating a platform for change even when there is no need for one.

- Example- Apple Ipod

Strategies to Minimize Resistance to Change

Strategies to Minimize Resistance Cont.

• Communication- Honest and frequent communication is the highest priority and first strategy required for any organizational change. Communication improves the change process in at least two ways:

1. Leaders develop an urgency to change.

2. Can potentially reduce the fear of the unknown.

• Learning- Learning is an important process in change because employees need new knowledge and skills to fit the organizations evolving requirements. Types of learning include:

1. Action learning

2. Coaching

• Stress Management- Stress management minimizes resistance by removing some of the direct costs and fear of the unknown in the change process.

Strategies to Minimize Resistance Cont.

• Employee Involvement- Essential part of the change process. Allows employees to feel personally responsible for the success of the change effort.

*Future search- System-wide group sessions in which participants identify trends and identify ways to adapt to those changes.

• Negotiation- A form of influence that involves the promise of benefits or resources in exchange for the target person’s compliance with the influencer’s request.

• Coercion- Includes persistently reminding employees of their obligations, frequently monitoring behavior to ensure compliance, confronting those that do not change, and using threats of sanctions to force compliance.

- Can sometimes include replacing employees that will not support the change.

Strategic Visions, Change Agents, and Diffusing Change

• Change Agents

- Anyone who possesses enough knowledge and power to guide and facilitate the change effort.

- These agents become transformational leaders that shape the overall direction for the change effort and motivate employees to achieve that objective.

• Diffusion of Change

- Change agents often test the transformation process with a pilot project.

*Pilot Project- More flexible and less risky.

- Employees are more likely to adopt the practices of a pilot project when they see that it is successful.

- Employees must have the required skills and knowledge to adopt the practices introduced by the pilot project.

- The pilot project gets diffused when employees have clear role perceptions.

Three Approaches to Organizational Change

• Action Research Approach

• Appreciative Inquiry Approach

• Parallel Learning Structure Approach

Action Research Approach

• A data-based, problem-oriented process that diagnoses the need for change, introduces the intervention, and then evaluates and stabilizes the desired changes.

• It adopts an open systems view:– Recognizes that organizations have many interdependent parts,

so change agents need to anticipate both the intended and unintended consequences of their interventions.

The Action Research Process

1. Form client-consultant relationship- Consultants need to determine the client’s readiness for change

2. Diagnose the need for change- Identifies the appropriate direction for the change effort by gathering and analyzing data about an ongoing system.

3. Introduce Intervention- Includes building a better organizational structure, building more effective teams, managing conflict, or changing corporate structure.

• Incremental Change- the organization fine-tunes the system and takes small steps toward a desired state.

• Quantum Change- the system is overhauled decisively and quickly.

4. Evaluate and stabilize change- If the activity has the desired effect, the change agent and participants need to stabilize the new conditions. Rewards, information systems, team norms, and other conditions are redesigned to support the new values and behaviors

Appreciative Inquiry Approach

• An organizational change process that directs attention away from the group’s own problems and focuses participant’s on the group’s potential and positive elements.

• Positive Organizational Behavior- focuses on building positive qualities and traits within individuals or institutions as opposed to focusing just on trying to fix what might be wrong with them.

The “Four-D” Model of Appreciative Inquiry

1. Discovery- identifying the positive elements of the observed events or organization.

2. Dreaming- Envisioning what might be possible in an ideal organization.

3. Designing- Involves dialogue in which participants listen to selfless receptivity to each other’s models and assumptions and form a collective model.

4. Delivering- Participants establish specific objectives and direction for their own organization based on their model.

Parallel Learning Structure Approach

• Highly participative groups constructed parallel to the formal organization with the purpose of increasing the organization’s learning and producing meaningful organizational change.

Cross-Cultural and Ethical Issues

• Some organizational change practices face ethical issues:– Threats to the privacy rights of individuals.

– Potential increase of management power by inducing compliance and conformity in organization members.

– Undermine the individual’s self-esteem.

– Change in management consultant’s role in the change.

Personal Change for the Road Ahead

• Understand Your Needs and Values

• Understand Your Competencies

• Set Career Goals

• Maintain Networks

• Get a Mentor

Questions

• Force field analysis is: (B)

– (A) A course that jedi’s need to take in school

– (B) Lewin’s model of systemwide change

– (C) Model of freezing and unfreezing

– (D) Comes right before forces of change model

• Name three possible reasons for resistance to organizational change.

– (direct costs, saving face, fear of the unknown, breaking routines, incongruent systems, incongruent team dynamics)

• (T/F) A “change agent” is anyone who possesses enough knowledge and power to guide and facilitate the organizational change effort. TRUE

Questions

• Name two of the four parts in the “Four-D” model of appreciative inquiry– (Discovery, Dreaming, Designing, Delivering)

• (T/F) Unfreezing is the first part of the change process where the change agent breaks the equilibrium between the driving and restraining forces. True