managing change in organisations 02-12-10

STAKEHOLDER ANALYSIS02/12/10

MANAGING CHANGE IN ORGANISATIONS

Identifying Stakeholders

The first step in stakeholder management are: a). Identify the various stakeholders b). Assess their commitment to change and c). Their ability to influence the outcome.

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Who are the stakeholders?

Individuals or groups who may be affected by the change. Some of those affected may not be employees of the

organization. a). Employees b). Shareholders c). Investors d). Customers e). Suppliers f). Government- whose laws must be obeyed, and to whom

taxes and other obligations may be due. g). Communities- members of the wider community who may

be affected by such issues as pollution, job opportunities and house prices may also need to be considered.

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What is their commitment?

Stakeholders can have a: a). Positive b). Neutral or c). Negative interest in the change. While change managers may pay careful attention to some

powerful stakeholders, they may completely overlook others.

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What is their ability to influence the outcome?

Shaw and Maletz (1995) classify stakeholders according to both their power to influence outcomes and their commitment to the change.

They differentiate between: a). Blockers – stakeholders who proactively intervene to

prevent the change from succeeding. b). Sponsors – stakeholders who proactively work to ensure

that the change effort succeeds.

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Other classification of key stakeholders

Piercy (1989) and Grundy (1998) developed a 2x2 matrix (see fig. 1).

a). Sponsors and blockers are more powerful than the helpless victims or beneficiaries.

However, those who may be helpless today may be in a much more powerful position sometimes in the future, and this possibility may influence how the change managers decide to respond to their concerns.

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Other classification of key stakeholders

b). Stakeholders who are not directly affected by the change can also be differentiated in terms of their power to influence the outcome.

i). Meddlers, could include journalists who are motivated to achieve their own outcome of selling more newspapers. They may do this by leaking the news of redundancies or by presenting a story about a change in a way that will be controversial.

ii). Bystanders are those who are aware of the change but are not affected by it and do not have the power to influence the outcome.

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Other classification of key stakeholdersfigure 1

Power/influence

Meddlers

Sponsors and

Blockers

BystandersHelpless Victims/

Beneficiaries

Stake

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How to involve various stakeholders

Balogun and Hailey (1999) suggest that the focus of the change strategy may need to change over time.

In the short term the critical requirement might be to secure the organization`s survival. At this stage the organization might engaged in re-creation (impose radical cuts and closures and redefine the purpose of the organization).

In the long term the focus may switch to a more incremental strategy of turning and the major concern may become continuous improvement.

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Zaltman and Duncan (1977) cite 5 ways change managers attempt to influence others.

a). Complexity and communicability. If the required change is complex and difficult to communicate, the initial style of influence might involve a high level of explanation and education.

However, once people understand the problem and what is required, other means of influence might be more effective.

b). Compatibility and relative advantage. A change that is compatible with the change target preferences and offers relative advantage over current practice might lend itself to a persuasive strategy.

In other cases negotiation or high levels of involvement might be the most effective way forward.

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c). Divisibility. Where a change is divisible and where quick action is required it might be decided to direct a part of the organization to adopt a small-scale trial before making a decision about how to proceed.

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Input –output placement

A prime reason for resistance to change is due to the fear about what the change may mean (redundancies are common outcome of business re-engineering). So it is not unnatural for people to resist change programmes.

There two reasons for out-placement: 1). Change can result in a surplus of manpower 2). Those who continue to resist must be dealt with.

If out-placement is managed in an unsympathetic way- morale will suffer and those left behind may become more negative.

If it is managed in a firm, clear and sympathetic way- the negative effect of redundancies on morale will be lessened.

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Change manager need to be firm, clear and sympathetic.

- FIRM. Once the scale of redundancy is known, it needs to be communicated. It move the people through the negative curve.

- Explain how the redundancies will be handled, rather than the way they are.

- Explain that the changes will demand a new type of behaviour, and those that find it difficult to adapt will be given every support. If they wish to leave they also will be helped.

- Support the resisters, but if they continue to refuse to support the change, then take firm action.

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CLEAR. Form a project team (by selection, or ask for volunteers) to manage the in/out-placement.

Their role will be to see what opportunities and vacancies exist elsewhere in the organization (in-placement) and outside the organization (out-placement).

The objective is to ensure that all those made redundant are given every help to find a new job, and are supported through their own period of personal change.

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POSITIVE SYMPATHETIC. Being firm and clear does not mean being `tough`. Do not talk about `getting rid` of people. Instead talk about giving everybody the `opportunity to succeed`.

Explain that the organization has to change, and the opportunity to succeed has also changed. (the number of opportunities in the organization may be more restricted-due to less roles, even though the quality of opportunity may improve-due to broader personal development).

Explain that a team is being set up to actively help those who cannot be offered an opportunity in the organization.

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This support will need to include:-personal counselling to help people set new personal

objectives;- Training for people to improve their CVs and interview skills;- Use of external agencies to find job;- Adverts in local press of availability of skilled people;- In-house training information with details of external courses

for people to broaden their skills and employability.

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The techniques above will not prevent the anger at redundancy, but it will positively help people through their own personal change, supporting them to identify what they want, and making a plan.

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managing change in organisations 02-12-10

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