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Change Management


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Change Management

  1. 1. BY: MUHAMMAD RIZWAN QAMAR Introduction to Change Management
  2. 2. Introduction 2 We live in a boundary-less environment. Nations compete  Cultures merge  Environmental forces act Creating the necessity for change in:  Socio-culture and Political Environment  The spheres of Economics and Business Activities. Indigenous industries must strategize effectively to  counter the onslaught of bigger or more powerful multinational corporations.
  3. 3. How to counter MNC Threat 3 It has become necessary to reflect on the change in nature, type and extent of change sweeping organizations, big and small around the world in their bid to survive and sustain themselves in ever changing and uncertain business environment and thus align indigenous business accordingly.
  4. 4. Defining Organizational Change 4 Organizational change may be defined as: The adoption of a new idea or a behavior by an organization.  It is a way of altering an existing organization to increase organizational effectiveness for achieving its objectives.  Organizational change is primarily structural in character and it is designed to bring about alterations in organizations:    Structure Methods Processes.
  5. 5. Organizational Survival 5 Successful organizational changes must continually focus on making organizations responsive to major developments like: Changing customer preferences  Regulatory norms  Economics shock  Technological innovations. Only those organizations that are able to undertake  suitable change program, can sustain and survive in a changing and demanding economic order in their bid to remain ahead of others in the race.
  6. 6. Forces of Change 6 • There are two type of forces: – Internal forces • • • • – Change in size of the organization Performance gap (target and actual result) Employ needs and values Change in the top management External forces • • • Technology Business scenario (changing needs and demands of customer, supplies and other stakeholders) Environmental factors (economic, political, demographic)
  7. 7. Resistance to Change 7 • There are two types of resistance: – Individual resistance to change • • • • • • • – Change lead to insecurity due uncertainty Fear that it may not bring better prospects Threatened by technology Obsolescence of skills Less wages Loosing jobs Working with different people Organizational resistance to change • • • Threat to some top guys Structural inertia of bureaucracy Resource constraints.
  8. 8. Response to Change 8 Depends on the employee’s perception of change. Therefore one important task of management of an organization is to understand and create a positive attitude among employees regarding change. Figure 1.1 on next slide shows various responses to change.
  9. 9. Figure 1.1 Reponses to change 9 Introducing change Resistance to change Factors (psychological, social, Personally, demographic) Modifications and alterations Gradual acceptance to change Acceptance to change
  10. 10. Reactions to change 10  When the change is announced, usually the first reaction people have is to meet the change with a sense of shock.  Three major reactions may be:    Anger (people affected negatively blame person of change, may try to sabotage the change) Denial (People do not want to be accounted for the things going wrong) Acceptance (Once the anger is over, change is accepted.  It is extremely important for us to understand that people may go through each of these phases in varying degree, as they make transition from the old way of doing business to the new.  How one manages this transition period in crucial.
  11. 11. Overcoming Resistance to Change 11 Some approaches are: Education and Communication  Employee Participation and involvement in the change process  Facilitation and support (Emphatic and considerate listening can reduce fear and anxiety)  Negotiation and Agreement (Involve union in the process. Brief them about need and value of change. This causes problem when there are more then one unions. All fight for power and recognition) 
  12. 12. Theories of Organizational Changes 12 Reflecting to the nature of change process, most change theories could be grouped in the following four categories:  Evolutionary change:   Continuous cycle of variation, retention and selection among several units regardless of the rate of change Naturally the outcome can be radical or gradual depending on the timely distribution of the variation, retention and selection of events through out the organization.
  13. 13. Theories of Organizational Changes 13  The dialectic theory:    Talks about the organizational existence in pluralistic world of ambiguous and contradictory forces and values that compete with one another to get control over the others. When status quo is confronted by the opposing forces (with sufficient power), change occurs. Life cycle theory:  It proposes change process as a linear irreversible sequence of prescribed stages which facilitates organization to move from the point of departure towards an end which is prefigured in the present state.
  14. 14. Theories of Organizational Changes 14  The teleological Theory:   It talks about the organization’s interaction with the external and internal construct and its efforts to reach to the defined goals. This is deliberate process of reaching to the predetermined goal as the ultimate objective.
  15. 15. Five Key Phases 15 Effective management of the people dimension of change requires managing the following five phases: Being aware of the requirements of change.  Generating willingness for participation and supporting the change initiatives.  Gathering information and knowledge about the method and process of change,  Ability to implement the change on regular basis.  Reinforcement to keep the cahnge process going. 
  16. 16. Organizational Change 16  As organizations are operating in a volatile environment, they may not always be able to direct changes in a planed fashion.    Thus changes may occur spontaneously or randomly in an organization. Such changes may be termed as unplanned changes. They may be disruptive, like a sudden strike thus closure of a plant.  In comparison, planned change is a result of specific efforts by a change agent and more and more intentional in nature.    Planned changes are undertaken with the purpose of achieving a goal that might not be achieved otherwise. It is also undertaken to reach new horizons and progress rapidly towards a given set of goals and objectives.
  17. 17. Types of Organizational Change 17 Most planned changes are directed at dealing with performance gaps to bridge the discrepancy between the desired and the actual state of affairs. Some of the features of planned change are described as under: It is deliberate, systematic and well thought of.  Velocity of change depends on the degree of level of significance.  Status quo is challenged.  Reactions can be both positive and negative.  Focuses on long-term changes. 
  18. 18. The Process of Planned Change 18 The forces for planned changes can be found in the following: Organization-environment relationship (merger, strategic alliance, etc.) where organizations attempt to redefine their relationship with changing social and political environment.  Organizational life cycle (changes in culture and structure of organization’s evolution from birth through growth towards maturity).  Political nature of organization (changes in internal control structures, etc) to deal with shifting political current. 
  19. 19. Seven Objects of Change 19 Planned changes based on these forces can be aimed at changing organizational: purpose  strategy  structure  people  tasks  culture  technology   (these are highly inter-twined and affect one another).
  20. 20. To Initiate Change 20 To initiate planned changes organizations have to undertake two processes: Remove or lessen the restraining forces  Move towards strengthening the driving forces that exist within the organization. Kurt Lewin’s model assumes two obstacles which  generally affect the change process: Generally individuals experience obstacles to change as they are unable to alter long established practice.  They may try to do things differently but may have the tendency to return to traditional ways after short time. 
  21. 21. Three Step Sequential Model 21 To overcome obstacles Lewis proposed a three step sequential model. Unfreezing: The forces are reduced by refuting attitude and behavior to create a perceived need for some thing new.  Moving / Changing: This involves a shift in behavior of organizations by modifying system, process, technology and people to achieve compliance, identification and internalization.  Refreezing: Here actions are taken to sustain the drive fro change and to facilitate the institutionalization process of the change in day to day routine of the organizations. 
  22. 22. Lippitt’s Seven Step Model 22 In this model seven steps of change have been discussed:        Scouting Entry Diagnosis Planning Action Stabilization Evolution. Unfreezing Moving Freezing
  23. 23. Action Research Model 23 According to this model, planned change is a cyclical process in which initial research about organizations provides the data to guide the subsequent action to bring the required changes. It emphasizes on the significance of data collection and the timed diagnosis prior to action planning and implementation and careful evaluations of the actions.
  24. 24. Eight Steps of A/R model 24 Problem identification. Consultation with the expert. Data gathering and preliminary diagnosis. Feedback to key client or group. Joint diagnosis of the problem. Joint action planning. Action. Data gathering after action.
  25. 25. Dimensions of Planned Change 25 Though the models of change describe:      how to implement change steps of planned changes maybe implemented in a variety of ways depending on clients needs and goals the change agents’ skills and values and the organizational context.
  26. 26. Two Key Dimensions of Planned Change 26 Planned change can be contrasted across situations on two key dimensions. Magnitude of change: Planned change can range from incremental change to quantum change.  In recent years organizations are moving towards quantum change, however it may or may not be developmental in nature. It can simply involve drastic change in the strategic direction without developing the problem solving capacity.  Presently, large organizations are transforming themselves from control-oriented bureaucracies to highinvolvement organizations capable of changing and improving themselves continually. 
  27. 27. Two Key Dimensions of Planned Change 27  Degree of Organization: Planned change can also vary depending on the degree to which the organization or client system is organized.  In highly mechanistic and bureaucratic (over organized) structure, job design, leadership styles policies are too rigid and inflexible. Communication is suppressed, conflicts are avoided and employees are apathetic.   Here change through loosening of control on behavior is attempted. In under-organized loose task definition, communication fragmented, job definition are ambiguous.  Here change is aimed at increasing organization by clarifying leadership roles, defining job responsibilities and tighter control.
  28. 28. Strategies for Change Management 28  1. 2. 3. 4. According to Bennis, Benne and Chin, there the four basic strategies: Empirical / Rational: People are rational and will follow their self-interest once change is revealed to them. Normative / Re-educative: People are social and adhere to culture norms and values. (Change in Norms / Values). Power / Coercive: People are basically compliant and will generally do what they are told. (Change of authority and punishment). Environmental / Adaptive: People oppose loss and disruption, but they adopt readily. Change on new organization and transferring people).
  29. 29. Toolkit for Managing Change 29 According to Nicklos following set of skills are required:      Political skills Analytical skills People skills System skills Business skills
  30. 30. Toolkit for Managing Change 30  Generally there is no single strategy, it could be general or grand (mixture).  The mix of strategies serve the best.  Some factors to select effective change management strategy are:  Degree of resistance   Target Population The Stakes Time Frame  Expertise  Dependency  Strong – 3 & 4 Week – 1 & 2 Large – All four High – All four Short – 3 Long 1,2,4 Adequate – some mix None – 3 Some level of negotiations
  31. 31. 31 The End