Chapter Sixteen

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Chapter Sixteen Managing Change
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Forces of Change
External Forces originate outside the
organization.

• Demographic Characteristics- the workforce is
  more diverse- there is a business imperative to
  effectively manage diversity
• Technological Advancements- organizations are
  increasingly using technology as a means to
  improve productivity and market competitiveness
• Market Changes- the emergence of a global
  economy is forcing companies to be more
  competitive and to do business differently-
  organizations are forging new partnerships and
  alliances aimed at creating new products and
  services
• Social and Political Pressures- society and its
  legislative bodies can put pressure on
  organizations to change the way they do business
  the tobacco industry is a good example

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Forces of Change (continued)
Internal Forces originate inside the
organization.

• Human Resource Problems/Prospects- employees
  needs, job satisfaction, organizational
  commitment, behavior, and performance are forces
  of change- dissatisfied employees and high
  levels of absenteeism and turnover are signs
  that change is needed
• Managerial Behavior/Decisions- the level of
  conflict between managers and their direct
  reports is a force for change- inappropriate
  leader behavior may result in employee problems
  requiring change- inequitable reward systems are
  an additional force for change

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Lewin's Three Step Model
Unfreezing
Refreezing
Movement or Change
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A Systems Model of Change
Target Elements of Change
OrganizingArrangements
Inputs
Outputs
Internal Strengths Weaknesses External
Opportunities Threats
OrganizationalLevel Department/group
level Individuallevel
Strategy
Goals
Social Factors
People
Methods
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Kotters Steps for Leading Organizational Change

• Step Description
• Establish a sense Unfreeze the organization by
  creating aof urgency compelling reason for why
  change is needed.
• Create the guiding Create a cross-functional,
  cross-level group ofcoalition people with
  enough power to lead the change.
• Develop a vision Create a vision and strategic
  plan to guide theand strategy change process.
• Communicate the Create and implement a
  communication strategychange vision that
  consistently communicates the new vision and
  strategic plan.
• Empower broad- Eliminate barriers to change, and
  use targetbased action elements of change to
  transform the organization. Encourage risk
  taking and creative problem-solving.

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Kotters Steps for Leading Organizational Change
(continued)

• Step Description
• Generate short- Plan for and create short-term
  wins orterm wins improvements. Recognize and
  reward people who contribute to the wins.
• Consolidate gains The guiding coalition uses
  credibility fromand produce more short-term wins
  to create more change.change Additional people
  are brought into the change process as change
  cascades throughout the organization.
  Attempts are made to reinvigorate the change
  process.
• Anchor new Reinforce the changes by
  highlightingapproaches in the connections
  between new behaviors and culture processes and
  organizational success. Develop methods to
  ensure leadership development and successes.

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Resistance To Change
Resistance to Change an emotional/behavioral
response to real or imagined work change.
For Class Discussion What do you think are the
top three reasons people resist change? How do
we overcome the resistance to change?
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Characteristics of OrganizationDevelopment (OD)

• OD involves profound change
• OD is value loaded
• OD is a diagnosis/prescription cycle
• OD is process-oriented

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Phases of Organizational Development

• Organizational development unfolds in a series of
  phases
• Entry, Contracting, Diagnosis, Feedback,
  Planning, Intervention, Evaluation, Termination
• These are phases, not steps, because no clear
  boundaries exist between them
• Phases can repeat.

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Entry

• First contact of the consultant with the client
• Usually client initiates contact
• Building a client-consultant relationship
• Mutual evaluation of each other
• Decide they can develop a compatible working
  relationship

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Contracting

• Develop an agreement between the consultant and
  client
• Can range from an oral agreement to a legally
  binding agreement
• Describes mutual expectations and each partys
  duties
• Not static. Subject to renegotiation as the
  organizational development program unfolds

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Diagnosis

• Consultant gets information about the client
  system and diagnoses its current state
• Observe the clients behavior and reactions
• Observe physical characteristics of system
• Systematic data collection using surveys,
  interviews, and company records
• Consultant summarizes this phases results for
  feedback to the client system

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Feedback

• Consultant has a series of feedback meetings with
  client system members
• The number of meetings varies according to the
  scope of the organizational development program
• Several steps
• Consultants analysis
• Discussion
• Consultants preliminary diagnosis
• Actively work with members of client system to
  arrive at collaborative diagnosis

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Planning

• Collaborative activity between consultant and
  client system
• Identify alternative courses of action and the
  effects of each
• Lay out the steps in the change program
• Client decides the nature of the change
  programnot the consultant

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Intervention

• Collaborative intervention to move the client
  system to the desired future state
• Includes job and organizational design changes,
  conflict reduction program, and the like.
• Consultants role
• Earlier client involvement helps reduce
  resistance to change in the intervention phase

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Evaluation

• Focuses on whether the organizational development
  effort had the desired effect
• Ranges from simply asking how the client feels to
  a well-designed research effort
• Done independently of the consultant
• Should also give the client system information
  about the next steps to take

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Termination

• Ends at some point
• Internal consultants are part of the organization
  and can continue contact
• The goal is independence of the client system
  from the consultant. Build client system
  self-reliance

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Interventions

• Human Process
• Goal improve human processes to get more
  effective organizational functioning
• Structural and technological
• Goal improve human productivity and
  organizational effectiveness
• Human resource management
• Goal change individual behavior and performance
  to get improved organizational effectiveness
• Strategy
• Goal strategic shifts to gain competitive
  advantage