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Resistance to organizational change

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Resistance to organizational change

  1. 1. resistance to
  2. 2. Introduction To change is to move from the present to the future, from known information to relatively unknown information. Therefore, change can be defined as ―to make or become different, give or begin to have a different form‖
  3. 3. Organizational Change • Involves planned and unplanned . • Transformation in an organization. • It is the movement from current stage to some future and preferred stage. • It is a continuous process.
  4. 4. Example of organizational change • Mission changes • Strategic changes • Operational changes (including Structural changes) • Technological changes • Changing the attitudes and behaviors of personnel
  5. 5. IMPLEMENTING CHANGE Two main approach to change in organization • Top down change • Bottom up change
  6. 6. Resistance to change Resistance occurs when the change is not interpreted well or understood. It is expected and represents different interests within the organization. The manager’s role is to clarify the meaning of change. Resistance is a very real and common issue that is faced by change managers during the process of change.
  7. 7. Why change is resistance • Dislike of change. • Discomfort with uncertainty. • Perceived negative effects of interests. • Attachment to the organizational culture/identity. • Lack of conviction that change is needed. • Lack of clarity as to what is needed.
  8. 8. Contd… • Belief that the specific change being proposed is inappropriate • Belief that the timing is wrong • Excessive change • Cumulative effects of other changes in one’s life • Reaction to the experience of previous changes • Disagreement with the way the change is being managed
  9. 9. RESISTANCE TO CHANGE- CASE STUDY ON KODAK Company Profile: • In 1880, after inventing and patenting a dry- plate formula and a machine for preparing large numbers of plates, George Eastman founded the Eastman Kodak Company. • By 1884 Kodak had become a household name after he replaced glass photographic plates with a roll of film. • The product became user-friendly-―as convenient as the pencil‖
  10. 10. • Eastman identified Kodak’s guiding principles as-mass production at low cost, international distribution, extensive advertising, customer focus and growth through continuous research. • With the advent of color technology, the success story continued as the company invested heavily in R&D and by 1963 Kodak had become the industry standard. • Sales increased by launching into new product lines such as cameras and medical imaging and graphical arts.
  11. 11. • The company operates through three segments: The Digital & Film Imaging segment provides consumer- oriented traditional and digital products and photographic services such as film, photofinishing services & supplies and digital cameras. • The Health Group segment provides analogue products that include medical films, chemicals and processing equipment, and services and digital products including PACs, RIS, digital x-ray & output hardware supplies. • The Graphic Communications segment provides inkjet printers, high-speed production.
  12. 12. Failed Strategies and the Death of Kodak • Innovation failure • A culture of complacency • Shift to digital • Ignored the trend
  13. 13. WHAT KODAK SHOULD HAVE DONE • Break up the business and sell of the parts. • Sell the whole print business like a fixed term bond. • License the brand or the technology. • Leverage their distribution network and ignore digital.
  14. 14. RESISTANCE TO CHANGE: A CASE ON PETER PAN BUS LINES • The company traces its history back to 1933 and since then it has undergone numerous changes, big and small. • Peter Pan Bus Lines has re-evaluated ways to make sure that its passengers and employees are safe and secured.. After the 9/11 bombing, the company intensified its commitment to safety and security.
  16. 16. RESISTANCES FACED: ACTIVE RESISTANCE PASSIVE RESISTANCE • Finding fault • Agreeing verbally but not following through • Ridiculing • Feigning ignorance • Appealing to fear • Withholding information • Manipulating
  17. 17. OVERCOMING CHANGE: • Build Trust. • Openly Communicate and Discuss Change. • Involve the Employees. • Provide Rewards and Incentives. • Make sure that the Changes are Reasonable. • Educate the Workforce. • Provide Empathy and Support.
  18. 18. Case Study: Oti-Yeboah Complex Limited (OYCL) • Oti-Yeboah Complex Limited (OYCL) is situated in Sunyani, and was incorporated as a Limited Liability Company on 31st October, 1986. • Till 2008, it was operating sawmill and producing processed wood products • From 2008 – 2010: from sawmilling to plywood production.
  19. 19. Changes in • Strategy • Structure • Culture • Technology • Work processes of the organization
  20. 20. Employee resistance due to • New roles • Redundancy • Added responsibilities • Fear of unknown and possible loss of job
  21. 21. Forms of Resistance • Strikes • Boycott • Lockouts because of fear.
  22. 22. Consequence of resistance • Production stoppages • Paying labour for no job done.
  23. 23. Suggestion • Education and communication • Participation and involvement • Facilitation and support • Negotiation and agreement
  24. 24. Case Study: Acquisition of PETROM by OMV • Petrom, the largest oil and gas producer in South Eastern Europe, With activities in the business segments of Exploration and Production, Refining, Marketing as well as Gas, was the market leader in Romania. • In December 2004, the company was acquired by the multinational company OMV Austria. • The company received the position of regional centre for Southeast Europe within OMV Group
  25. 25. THE ORGANIZATIONAL CHANGE • set up of regional centers for leadership • new management structure formation • centralization of all activities
  26. 26. Contd… • Close-down unprofitable objectives • Outsource activities • implement a new ERP system • Reshape the Corporate Center project
  27. 27. SYMPTOMS OF RESISTANCE • Distinction • Attitude • Signs • Resign or Accept early retirement
  28. 28. CAUSES OF RESISTANCE • Fears • Different assessments • Misunderstanding and lack of trust • Wrong methods • Inertia and low tolerance for change
  29. 29. Conclusion ―It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change‖- Charles Darwin ―It’s always going to be continuous improvement. We will never declare victory‖- Richard Clark, CEO of Merck. The natural tendency—a critical survival mechanism—is to avoid similar dangers creates resistance to organizational change. Human emotions loss, anger and fear are the driving forces to resistance.
  30. 30. Questions arise how do people respond to change? Active Passive •Arguing •Ignoring •Ridiculing •Non-participating •Blaming •Procrastination •Distorting •Mishandling •Tracking •Pretending •Blocking •Avoiding
  31. 31. Few examples of changes & responses Changes and their effects in overseas organizations. • Thomas Alva Edison was forced to step down by investor Henry Villard in 1893 from Edison’s own company for his adversity to change attitude though he was innovator, entrepreneur, and businessman. • Arcelor-Mittal: M & A, resistance from shareholders. • UK companies are not eager to run their Indian BPO’s and already has started shifting their customer support operations to UK.
  32. 32. Few examples of changes & responses Changes and their effects in Indian organizations. • Political unrest by allies and opposition for diesel prices hike and regulation on LPG cylinder distribution. • FDI in single and multi-brand retail created country wide protest last year, even its going now. • Cancellation of Niyamgiri Bauxite mining project for the safeguard of local tribal people. • TATA Motors shifted their NANO factory to Sanand, Gujarat on the face of resistance by local farmers from Singur, WB, in 2008. • Bank employees went on strike for two days in the month of August ’12 to protest higher management decisions.
  33. 33. Protest from oppositions parties against diesel price hike
  34. 34. Strike by Bank employees
  35. 35. Manifestation against change is more or less same around the World
  36. 36. Positive effects of changes • When good, well known, charming person replaces your peevish boss in the office employees become happy and productivity goes high. • In case of less employees requirement; if the employees are transferred to other functional area under the same organization than lay off by the organization; change is positive for the employees. • If new safety-security policy for the employees is reinforced in the organization employees welcome the change.
  37. 37. • Question lies here how do the managements try to mitigate these resistance?