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1 © Atul Kuver 2011 LEADING AND MANAGING PEOPLE IN CHAOS AND COMPLEXITY Building Organisational Resilience A model for building change readiness through appropriate organisational culture Atul Kuver 25 th February 2011

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Page 1: Building Organisational Resilience

1 © Atul Kuver 2011

LEADING AND MANAGING PEOPLE IN CHAOS AND COMPLEXITY

Building Organisational Resilience

A model for building change readiness through appropriate organisational culture

Atul Kuver

25th February 2011

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EXECUTIVE SUMMARY

The purpose of this study was to develop a ’fit-for-purpose’ model (Figure I) to build

change readiness through organisational culture. The model was established through

a resource-based view of the organisational culture and practices that assist change

readiness, sustainable people management practices, and the capacity to implement

change to deal with business sustainability challenges.

Figure I. Model to build change readiness through organisational culture.

A Defence Business (ADB) is one of the world’s largest defence contractors. Its

customers include armed forces of countries around the world, government agencies

and defence and aerospace prime contractors and the business has strong presence

in the UK, USA and Australia. This report concerns one of ADB’s smaller operations

(referred to as ‘Div A’) located in South Australia. ADB needs to address several

issues affecting Div A in delivering more sustainable business practices. Div A’s issues

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concern commercial and social sustainability. These issues require changes at ADB

and Div A will be affected. The change readiness model developed and described in

this report is aimed at building Div A’s readiness for change through its culture. The

model explores the gap between the preparation and action stages of the change

process to provide a framework with which to reduce this gap to a level where

continuous change is accepted.

The report examines the concept of change readiness to establish links between

change readiness and organisational culture. The model treats the organisation, its

culture and the individual employees as an integrated and interconnected system. It

uses the concept of organisational resilience, and focuses on building change

readiness and organisational resilience through cultural resilience.

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Table of Contents EXECUTIVE SUMMARY ............................................................................................... 2

1 INTRODUCTION ................................................................................................. 5

2 THE CONCEPT OF CHANGE READINESS .............................................................. 7

3 CHANGE CHALLENGES AT ADB ........................................................................... 8

3.1 Business Overview ...................................................................................... 8

3.2 Change Challenges to Deliver More Sustainable Business Practices ............. 8

3.3 The Issues.................................................................................................. 10

4 THE MODEL: BUILDING CHANGE READINESS THROUGH APPROPRIATE ORGANISATIONAL CULTURE .................................................................................... 11

4.1 Structure, Components and Elements of the Model. ................................. 12

4.1.1 ‘Means – Ends’ Structure.................................................................... 13

4.2 Individual .................................................................................................. 14

4.2.1 Perception.......................................................................................... 14

4.2.2 Personal Valence ................................................................................ 15

4.2.3 Motivation ......................................................................................... 15

4.2.4 Self-Efficacy ........................................................................................ 16

4.2.5 Uncertainty ........................................................................................ 16

4.3 Culture ...................................................................................................... 17

4.3.1 Innovation, Risk-Taking, Learning Opportunities and Flexibility .......... 17

4.3.2 Resilience ........................................................................................... 18

4.3.3 Momentum ........................................................................................ 19

4.3.4 Change Valence and Change Efficacy.................................................. 19

4.4 Organisation .............................................................................................. 20

4.4.1 Information ........................................................................................ 21

4.4.2 Responsible Leadership ...................................................................... 21

5 FITNESS OF THE MODEL FOR USE BY ADB CHANGE AGENTS ............................ 24

6 CONCLUSION ................................................................................................... 25

REFERENCES ............................................................................................................ 27

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1 INTRODUCTION

Social, economic, political, or competitive factors are usually the initiators of

organisational change. Champoux (2011) suggests that modern organisations are

challenged with concurrent demands for change and stability. Organisations do not

appear to have the option of reacting to the forces of change that originate

externally or from within. Linear models of cause and effect no longer seem to apply.

Change management is also probably one of the most challenging issues for

managers in modern organisations. In most cases, there are usually two distinct

groups — those that want to proceed with change and those who feel they will be

worse off after the change.

This study has developed a model for building change readiness through appropriate

organisational culture. The notion of change readiness can be considered to be the

extent to which individuals in an organisation hold a positive outlook about the

necessity for organisational change as well as the extent to which the change will

benefit themselves and the organisation (Jones et al. 2005).

The model is established through a resource-based view of the organisational culture

and practices that assist change readiness, sustainable people management

practices and the capacity to implement change to deal with business sustainability

challenges. The resource-based view of an organisation sees the organisation as

having a unique set of resources and capabilities that gives rise to the concept of

competitive advantage.

Organisational culture includes ‘values, norms, rites, rituals, ceremonies, heroes,

and scoundrels in the organization’s history’ (Champoux 2011, p. 73). This

description is an expansion of Schein’s (cited in Jones et al. 2005, p. 363) three

dimensional view of organisational culture consisting of:

assumptions — the taken-for-granted beliefs about human nature and the

organisational environment;

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values — the shared beliefs and rules that regulate the attitudes and

behaviours of employees;

artefacts — the visible language, behaviours and material symbols within the

organisation.

These three dimensions provide a framework to examine an organisation’s change

readiness impediments and assist in identifying areas where improvements may be

made. In particular, values are seen to be central to understanding organisational

culture (Ott, cited in Jones et al. 2005, p. 363) and values can therefore be

considered to be a reliable depiction of organisational culture (Howard, cited in

Jones et al. 2005, p. 363).

Resilience has been discussed in terms of the individual (Bolton 2004; Coutu 2002).

Bolton (2004, p. 60) describes resilience as ‘the capability of people to withstand

hardship and, in facing adversity, to continue leading functional and healthy lives’. In

addition to individual or employee resilience, Bolton (2004) points out that resilience

can also exist at the organisational level and makes reference to ‘resilient

organisations’ (p. 61). Organisational resilience as discussed by Bolton (2004) seems

to be the result of resilient individuals.

The model presented here uses the concept of organisational resilience and focuses

on building change readiness through cultural resilience. In other words, a culture of

resilience should exist if an organisation is to be change ready.

The following framework will be used to discuss the significance of this model in

building organisational resilience.

Section 2 examines the concept of change readiness to establish links between

change readiness and organisational culture. The change challenges at the company

‘A Defence Business (ADB)’ is discussed in Section 3, to learn about the types of

change events the model may be required to address. The model —‘Building change

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readiness through appropriate organisational culture’ is presented in Section 4.

Section 5 illustrates the fitness of the model for ADB’s change agents followed by the

conclusion to this report in Section 6.

2 THE CONCEPT OF CHANGE READINESS

Armenakis and Harris (2007, p. 132) define readiness as the ‘cognitive precursor of

the behaviors of resistance to or support for organizational change’. They prefer the

term readiness instead of resistance because in their view the term readiness ‘fits

better with a positive approach to framing change’ (Armenakis & Harris 2007, p.

132). They found that individuals who were in the ready for change (contemplation)

stage and the actively changing (action) stage were more open to the introduction of

a new leadership development program and there was an increased likelihood that

the participants would positively evaluate its content and delivery (Harris & Cole

2007, cited in Armenakis & Harris 2007, p. 132).

Armenakis and Harris (2007, p. 129) identified five key change beliefs that appear to

provide reasons for the change recipient to support change initiatives. The beliefs

are:

1. discrepancy — the belief that change is needed and this is reflected in the

gap between the organisation’s present state and the state it wants to adopt;

2. appropriateness — the belief that a specific change designed to address the

discrepancy is the correct action;

3. efficacy — the belief that the change recipient and organisation will

successfully implement the change;

4. principal support — that leaders and managers within the organisation are

committed to the success of the change; and

5. valence — the belief that the change is beneficial to the change recipient.

Research suggests that readiness improves when change recipients can recognise

the need for change, sense their ability to successfully implement change (self-

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efficacy) and they are given the opportunity to participate in the change process

(Cunningham et al. 2002, p. 377). Reshaping capabilities then become an important

feature of an organisation’s ability to change and hence complements change

readiness. According to Beckard and Harris (cited in Jones et al. 2005, p. 367),

change readiness concerns the motivation and willingness of participants and

reshaping capabilities include the knowledge, skills, and abilities of the entire

organisation for successful change implementation.

3 CHANGE CHALLENGES AT ADB

3.1 Business Overview

A Defence Business (ADB) is one of the world’s largest defence contractors. Its

customers include armed forces of countries around the world, government agencies

and defence and aerospace prime contractors. The business operates several

countries including the UK, USA and Australia. The business has well established

customer relationships by offering product through-life capability and long-term

partnerships with its customers. Project management and engineering are ADB’s

core competencies.

3.2 Change Challenges to Deliver More Sustainable Business

Practices

Over the past two decades, the defence industry has consolidated. This has resulted

in fewer, larger defence organisations. The fifty largest defence businesses of the

early 1980s had now become the country’s top five defence contractors (Guay

2007).

In Australia, defence businesses focus on one customer — the Commonwealth of

Australia. Major defence contractors with operations in Australia include Boeing,

Raytheon, Lockheed-Martin, BAE Systems, Thales, and Australian Submarine

Corporation. Generally, the Australian operations are significantly smaller than those

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in the US or the UK. Smaller Australian defence subcontractors are often closely

aligned with the larger organisations to maintain sustainable businesses.

While ADB is a major defence prime contractor, this report concerns one of its

smaller operations located in South Australia. This division of ADB (to be referred to

as Div A) has approximately 200 employees at one of its South Australian sites.

Building change readiness through appropriate culture will be focussed on this site.

Div A is the result of an acquisition by ADB over a decade ago. Some cultural

remnants from the previous business still exist but overall ADB has been very

successful in integrating Div A after acquisition.

Smaller divisions within large corporations can be particularly vulnerable to change.

These divisions are at risk of being labelled ‘out-posts’. The core competencies of

such a division need to be visible and highlighted. A small division sometimes needs

to be run as an entirely different business to keep the division competitive. Div A,

while allowed significant autonomy, is still bound by processes, procedures and

policies of the global business. Many of these requirements were originally designed

with larger sections of the business in mind.

The consolidation of business divisions has had a significant impact on Div A. In

recent years, the division has undergone changes due to further acquisitions. The

small size of Div A means that it has had to cope with integration into other divisions.

While Div A has seemed to cope well through these changes, there are signs that the

on-going changes have had some negative effects on the division. Several managers

have been transferred or their positions made redundant. Uncertainty due to the

constant changes seems to be on the rise. The diversion of the Commonwealth’s

defence budgets to the on-going operations in Iraq and Afghanistan and the

perceived lack of work have made many employees nervous. The processes and

policies that worked well for larger projects now seem rigid when applied to smaller

ones. This adds another level of cost to bids. Competitors who do not have the

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additional cost burden —mostly smaller more agile organisations — are able to out-

bid ADB.

ADB has responded. Project management procedures have been revised to allow

‘tailoring’ of project processes. However, a major problem is that these changes are

not universal. While project procedures may have changed, other systems remain

rigid — for example Configuration Management (CM) and Quality Assurance (QA).

Both CM and QA are essential in maintaining product integrity and traceability so the

reluctance in making any changes to these seems justifiable.

3.3 The Issues

ADB needs to address several issues towards delivering more sustainable business

practices. Sustainability in this context is defined as the achievement of long term

and integrated commercial, environmental and social outcomes. Div A’s issues are

primarily commercial and social. For,

commercial sustainability:

o change procedures to allow Div A to become more competitive;

o develop project agility;

o maintain and recruit talent;

social sustainability:

o improve employee morale;

o maintain talent;

o address uncertainty;

These issues require changes at ADB. Div A in particular will be affected. The change

readiness model developed and described in this report is aimed at building Div A’s

readiness for change through its culture. The culture at Div A seems resilient and

able to cope well with change. This model provides a framework to improve this

capability and as a result improve the Div A’s readiness for change.

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4 THE MODEL: BUILDING CHANGE READINESS

THROUGH APPROPRIATE ORGANISATIONAL CULTURE

Coolican and Jackson (cited in Igo & Skitmore 2005, p. 123) believe that

organisational culture today provides a framework that can be used to ‘implement

and operationalize business strategies’. At the same time, organisational culture is

acknowledged as being difficult to change (Bresnen & Marshall, cited in Igo &

Skitmore 2005, p. 123).

The change readiness model proposed by Armenakis and Harris (2007) intended to

offer change agents with the perspective of actions required to plan a programme to

shape the five key beliefs which would then encourage change recipients to

positively accept the change. This intention distinguishes their model from the

model presented here.

The change readiness model described here explores the gap between the

preparation and action stages of the change process to provide a framework with

which to reduce this gap to a level where continuous change is possible. This model

should not be too dependent on external trigger and it should include continuously

improving change readiness within the organisation’s culture. This is done by

emphasising that effective organisational change can be driven through appropriate

organisational culture and that the fundamental source of culture is the individuals

who make up the organisation.

In this model, low change readiness means the organisational culture permits or

responds to change with difficulty. High change readiness means the culture copes

well with change with minimum disruption to everyday operations. The aim of the

model shown in Figure 1 is to illustrate the development of change readiness

through its culture. The structure, components and elements of the model will now

be discussed.

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Figure 1. Illustration of the model to build change readiness through appropriate organisational

culture.

4.1 Structure, Components and Elements of the Model.

The model treats the organisation, its culture and the individual employees as an

integrated and interconnected system. It is difficult to view these three components

as independent and unconnected. In this model, the Organisation is shown as the

structure within which Culture and Individuals are embedded. While it may be

possible to argue that the three components can be separated while keeping firm

links between them, the separated model may not clearly represent the inter-

dependent nature of the three parts. The assertion in this model is that

organisational change is fundamentally supported from an individual level. Culture

then provides the momentum and resilience needed for heightened change

readiness.

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The following terms will be used to describe the model:

elements —the basic building blocks and desired outcomes. Elements are

embedded within the models components;

components — the model has three components: Organisation, Culture and

Individual; and

structure — represents the overall model framework and refers to the

arrangement of the components, elements and their associated inter-

dependencies.

4.1.1 ‘Means – Ends’ Structure

The illustrated model shown in Figure 1 is based on a ‘means – ends’ structure. The

‘means’ are the concepts and frameworks that should be considered as ways of

building change readiness. Means are shown on the left half of the illustration. The

‘ends’ are the expected outcomes. Ends are shown on the right half of the

illustration. All means and ends are elements within the model. The individual or

employee is located in the centre of the illustration. This is in line with the

philosophy used to develop this model – that the individual is at the crux of the

organisation.

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4.2 Individual

In this model, five key elements for change readiness development in individuals are

considered. The key elements are:

Perception

Motivation

Personal Valence

Uncertainty

Self-efficacy

Although Figure 1 shows these as separate elements within the structure of the

Individual, in reality these elements may be interconnected and stimulating one

element may affect others. In order to make sense of the impact of the elements, it

is simpler to view each in isolation. This method provides a framework that can then

be used to create associations and linkages based on the organisation’s unique

circumstances.

4.2.1 Perception

According to Eby (2000, p. 420), the perceptions of employees about whether the

organisation is ready for change is an important aspect in recognising sources of

resistance to change. Perception then becomes an important element in two ways —

first, as a driver of change readiness and secondly as a predictor of change readiness.

While perception may be improved through information and leadership to improve

change readiness, using it as a predictor of change readiness is more difficult. Eby

(2000, p. 422) proposes that perceptions of change readiness are dependent on an

‘individual’s unique interpretation of the organisation’s context’. This makes

perception a subjective concept as there is no standard against which it can be

measured.

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In this model, the primary purpose of the perception element is its use as a driver to

increase the individual’s change readiness.

4.2.2 Personal Valence

Personal valence is the belief that the change is beneficial to the employee. When

the individual goes through the process of establishing personal valence, he or she

encounters decisional balance. Decisional balance refers to the expected risks of

change versus the likely benefits of change (Cunningham et al. 2002). The

individual’s perceptions of the benefits of change compared to the risks of failing to

change start the process of readiness for change (Cunningham et al. 2002).

Armenakis and Harris (2007) emphasised the impact of change recipient involvement

and participation on enhancing personal valence. Participation allows individual to

seek solutions to difficulties they face and improves efficacy by allowing them to

select those changes they feel they can accomplish (Armenakis & Harris 2007, p.

130). While participation seems simple in concept, it may in fact prove to be difficult

in practice. Leaders must also take into account the inter-dependent and complex

nature of an individual employee. Individual-to-individual, individual-to-culture, and

individual-to-organisation relationships and dependencies are not always clear in

today’s complex business environment.

4.2.3 Motivation

Gottschalg and Zollo (2007, p. 420) suggest that individuals’ motivation to behave in

certain ways are determined by the extent to which the behaviour assists them in

meeting their goals and the relevance of each goal to the individual. They use a

three-category taxonomy to capture the primary differences between the means

through which organisations can encourage motivation. The three categories are:

extrinsic motivation —is driven by the objective of achieving extrinsic work

related rewards such as money, power and recognition;

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hedonic intrinsic motivation — is driven through engagement in ‘enjoyable,

self-determined and performance competence-enhancing behaviour’; and

normative intrinsic motivation — is driven through engagement in behaviour

compliant with organisation norms and values.

(Gottschalg & Zollo 2007, p. 420)

The model illustrates that while extrinsic and hedonic intrinsic motivation may be

encouraged from an organisational level, normative intrinsic motivation is more

closely related to organisational culture.

4.2.4 Self-Efficacy

An individual’s perceived ability to successfully manage the change —self-efficacy —

has the effect of mediating individual readiness (Prochaska et al. 1997, cited in

Cunningham et al. 2002, p. 378) and organisational change (Armenakis et al. 1993,

cited in Cunningham et al. 2002, p. 378). Confidence in one’s ability to cope with

change is more likely to contribute positively to organisational change. Change may

be resisted if individuals perceive that the process exceeds their ability to cope

(Armenakis et al. 1993, cited in Cunningham et al. 2002, p. 379). In Cunningham et

al.’s (2002) study, workers with an active approach to work issues were more

confident in their coping ability regarding job change and demonstrated a higher

readiness for organisational change.

4.2.5 Uncertainty

Milliken (cited in Bordia et al. 2004, p. 508) defines uncertainty as ‘an individual’s

inability to predict something accurately’. Uncertainty evolves due to lack of or

ambiguous and contradictory information (Berger & Calabrese, Putnam & Sorenson

cited in Bordia et al. 2004, p. 508). Bordia et al. (2005, p. 508) characterises

uncertainty as an ‘aversive state’ that encourages responses which try and manage

or reduce it. During organisational change, uncertainty is also one of the most

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commonly reported psychological states (Bordia et al 2005, p. 509). Perceived

resistance to change may just be an individual’s efforts to try and minimise

uncertainty.

4.3 Culture

Champoux (2011, p. 74) outlines seven key elements that describe organisational

culture. These elements are:

levels — culture has different degrees of visibility with core values being the

least visible;

pervasiveness — culture is widely dispersed;

implicitness — veteran employees will often take core cultural values for

granted;

imprinting — culture is deeply rooted in the organisations history;

political — culture is connected to systems of power;

plurality — subcultures also exist;

interdependency — culture is interconnected with other parts of the

organisation;

One of the characteristics of this model is that Culture is represented as a ‘buffer’

between the Organisation and the Individual. The resilience element is embedded

within this buffer region. While it could be argued that an organisation exerts direct

and uninterrupted influence over the individual, the ‘culture as a buffer’ stance

seems reasonable as a general representation of modern organisations.

4.3.1 Innovation, Risk-Taking, Learning Opportunities and Flexibility

Weiner (2009, p. 4) recognised the broader contextual conditions that affect change

readiness. Four elements — innovation, risk-taking, learning opportunities and

flexibility make up the means through which organisational culture can heighten its

change readiness. These elements have been chosen as the primary means of

building change readiness because different levels of each element normally exist

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within many organisations. It is usually difficult to find a hard boundary separating

each of these elements and in many cases dependencies will exist between

elements.

Jones et al. (2005, p. 365) identified that:

1. Employee perceptions that their organisation is dominant in human relations

values and open systems values are more likely to possess positive views

about organisational change — Flexibility;

2. Innovation and dynamic nature of open systems culture suggests that

employees who perceive their organisational culture to be an open system

are likely to hold positive views on change — Innovation/Flexibility;

3. Training and development of human resources may relate to an individual’s

confidence and improve their ability to take on new challenges — Learning

Opportunities;

Studies that investigate the direct relationship between risk-taking and change

readiness seemed to be lacking. Nonetheless, risk-taking seems to be an important

element when considered together with innovation, flexibility and learning. Pursuing

new ideas is usually closely associate with risk (in many cases significant risk). At the

same time it is important to differentiate risk-taking from recklessness. The model

proposes that managed risk-taking could result in an innovative and dynamic culture.

4.3.2 Resilience

Coutu (2002, p. 48) observed that resilience theories overlap in three ways.

Individuals who are resilient possess a firm acceptance of reality, a profound belief

that life is meaningful and are able to improvise. Coutu suggests that people may

recover from hardship with just one or two of these characteristics, but true

resilience is only possible when all three characteristics exist and that these qualities

hold true for organisations (Coutu 2002, p. 48).

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This model embeds the resilience element within organisational culture. This has

been done for three reasons:

1. Individual resilience in a large group is not always obvious.

2. Resilience is a subjective concept. It is not possible to create a measure of

resilience and then compare individuals because there is no set standard

against which resilience can be measured.

3. Culture can be treated as a single entity. While sub-cultures still exist, it is

easier to gauge the aggregate resilience then to attempt qualification of

individual resistance.

4.3.3 Momentum

Jansen (2000, p. 54) presents three conceptualisations of momentum. The three

views are:

1. strategic persistence —the ability to maintain a prior course of action;

2. the ability of a leader to create or control momentum; and

3. momentum as a dynamic force, the presence or absence of which determines

the outcome of a change effort.

In this model, concepts (1) and (3) are of greater significance. Persistence and

momentum are good indicators of resilience.

4.3.4 Change Valence and Change Efficacy

Cultural change valence and change efficacy are extensions of personal valence and

self-efficacy discussed for the individual. The concepts are the same as that for the

individual, except that valence and efficacy now apply at the organisation culture

level. Cultural change valence is the cultural or aggregate belief that the change is

beneficial. Change efficacy at the cultural level means that the organisation’s culture

is at a point where it considers that it has the ability to successfully manage the

change.

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It could be argued that valence and efficacy are concepts that can only apply to

individuals rather than aggregates. This argument is sound. However, this model

sees organisational culture as a single entity (although there may be sub-cultures).

Therefore, while the two concepts may seem abstract when compared with the

concepts of reliance and momentum, they can still assist in understanding the

complex nature of organisational change readiness.

To increase or heighten change readiness, the organisation’s culture should aim to

be more resilient, and increase momentum, change valence and change efficacy. The

model suggests that these results may be achieved by developing or sustaining the

culture in the areas of innovation, risk-taking and learning opportunities. In addition,

the organisation must also demonstrate flexibility. These can be considered to be

the input parameters needed to develop the appropriate culture.

4.4 Organisation

The resource-based view sees the organisation as having a unique set of resources

and capabilities that gives rise to the concept of competitive advantage. According to

Teese and Pisano (cited in Jones et al. 2005), leading organisations in global markets

will need to show timely responsiveness to efficiently manage and re-deploy these

capabilities. Turner and Crawford (cited in Jones et al. 2005) further distinguish

between operational capabilities and reshaping capabilities. Operational capabilities

are those required to sustain everyday performance and these capabilities do not

typically help in managing change effectively. On the other hand, reshaping

capability consists of three key elements. These are (Jones et al. 2005, p. 367):

engagement — involves employees participation to encourage motivation

and dedication to the goals and plans of the organisation;

development — improving resources and business systems to achieve the

organisation’s goals; and

performance management — proactive management of factors that drive

organisational performance to ensure that it achieves the intended change.

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4.4.1 Information

According to Jimmieson et al. (2004), minimising feelings of uncertainty and

associated threats is a significant challenge faced by managers during organisational

change. During periods of change, individuals within the organisation need

information to help them develop a sense of situational awareness and

understanding (Sutton & Kahn, cited in Jimmieson et al. 2004, p.12). Jimmieson et al.

(2004) asserts that timely and accurate information about the changes and change

process may reduce uncertainty and that information may be made available

through either formal or informal channels (p.12).

The model considers uncertainty as a characteristic of the individual and places the

uncertainty element at its core. The information made available therefore must

permeate the organisational culture and reach the individual with minimum

filtration. It then becomes important that the culture is such that it maximises the

free flow of information to the individual. Uncertainty has already been discussed in

Section 4.2.5.

4.4.2 Responsible Leadership

Higgs and Rowland (2010) assert that the role of leaders in the change process has a

significant impact on the success of change. In this model, leadership is viewed as a

distributed function — a process that exists at many levels of the organisation and

not a function of position alone (Higgs & Rowland 2005). Higgs and Rowland (2005)

classified leadership behaviour and mindsets during organisational change into three

broad categories, namely, shaping, framing change, and creating capacity.

Shaping

This is a leader-centric approach to change implementation.

Framing Change

Here the leader creates a framework that lets others contribute to the change

process and displays a high level of trust in those who contribute to the change.

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Creating Capacity

The leader focuses on building individual and organisational capability and

encourages growth and learning.

The leadership characteristics for each leadership category and the impact of the

leader’s behaviour are shown in Table 1.

The behaviour of leaders can also influence the perception of organisational culture

(Block, cited in Igo & Skitmore 2005, p. 123). The different practices develop from

the basic assumptions leaders make when implementing changes needed for the

organisation’s long-term survival (Igo & Skitmore 2005, p. 123). Once adopted, these

assumptions are embedded into the organisation’s culture (Gordon, cited in Igo &

Skitmore 2005, p.123).

Leadership Category

Key Leadership Characteristics Impact

Shaping

is eager to be the ‘mover and shaker’;

sets the pace which others follow; and

expects others to follow the leader’s actions.

(Higgs and Rowland 2010)

negative impact on change success;

‘heroic’ models mitigate against sustainable performance.

Framing Change

creates a framework that lets other contribute to the change process;

displays a high level of trust in those who contribute to the change;

works with others to build vision and direction;

promotes the reasons for change and explains why it is not desirable to return to older practices;

positively related to change success;

Creating Capacity

focuses on building individual and organisational capability;

encourages growth and learning;

develops the necessary change implementation skills in people;

provides feedback; and

positively related to change success;

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provides training; Table 1. Leadership characteristics for each leadership category and the impact of the leader’s

behaviour.

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5 FITNESS OF THE MODEL FOR USE BY ADB CHANGE

AGENTS

Issue Possible Change

Event Attention

Allow Div A to become more competitive

Changes to procedures results in new or unfamiliar practices.

Organisation Information Responsible

leadership

Culture Innovation Risk-taking Flexibility

Individual Perception Self-efficacy Uncertainty

Develop project agility

Retraining of project managers and engineers.

Organisation Information

Culture

Learning opportunities

Innovation Flexibility

Individual Motivation Personal valance Self-efficacy

Maintain and recruit talent

Re-deploy employees to other sites.

Organisation

Recognition of excellence

Responsible leadership

Culture

Learning opportunities

Risk-taking Flexibility

Individual

Motivation Personal valance Uncertainty Self-efficacy

Improve employee morale and address uncertainty

Additional training and implementation of processes that allow greater transparency

Organisation

Information Responsible

leadership Recognition of

excellence

Culture Learning

opportunities Innovation

Individual Perception Motivation

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Personal valance Uncertainty Self Efficacy

Table 2. Application of the model to the issues faced by ADB in relation to Div A.

Table 2 shows several issues that need to be addressed at Div A. Dealing with these

issues would require change. Possible change events corresponding to each issue are

also given in Table 2. Column 3 shows the elements that would require the change

agent’s attention. The use of the word ‘attention’ is a deliberate attempt to avoid

the word ‘application’. Application implies that the model may be normative, which

it is not. Its purpose is to allow the change agent to use the organisational culture to

build or improve change readiness. The arrow traversing the Culture component in

Figure 1 should be taken as building change readiness through organisational

culture.

6 CONCLUSION

The purpose of this study was to develop a ’fit-for-purpose’ model to build change

readiness through organisational culture. The model has been developed through a

resource-based view of the organisational culture and practices that facilitate change

readiness, sustainable people management practices and the capacity to implement

change to deal with business sustainability challenges. The report has examined the

concept of change readiness to establish links between change readiness and

organisational culture. The change challenges at ADB were presented to learn about

the types of change events the model may be required to address.

This model provides a framework to improve Div A’s change readiness through its

culture and to build organisational resilience. It is important to note that the model

is not intended to be applied as a process for changing organisational culture. The

model does not actively seek to change the fundamentals of the established culture;

change readiness is developed through positive utilisation of organisational culture.

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