Managing Change and Innovation

Managing Change and InnovationManaging Change and Innovation

CHAPTER 11CHAPTER 11

2 Copyright © 2008 by South-Western, a division of Thomson Learning. All rights reserved.

Learning ObjectivesLearning Objectives

Define organizational change and explain the forces driving innovation and change in today’s organizations.

Identify three innovation strategies managers implement for changing products and technologies.

Explain the value of creativity, idea incubators, horizontal linkages, open innovation, idea champions, and new-venture teams for innovation.

Discuss why changes in people and culture are critical to any change process.

Define organizational development (OD) and large group interventions.


Learning Objectives (contd.)Learning Objectives (contd.)

Explain the OD stages of unfreezing, changing, and refreezing.

Describe the sequence of change activities that must be performed in order for change to be successful.

Identify sources of resistance to change. Explain force-field analysis and other

implementation tactics that can be used to overcome resistance.


Turbulent Times The Changing Work Place

Turbulent Times The Changing Work Place

Today’s organizations need to continuously adapt to new situations if they are to survive and prosper

One of the most dramatic elements is the shift to a technology- driven workplace

Ideas, information, and relationships are becoming critically important


Organizational ChangeOrganizational Change

The adoption of a new idea of behavior by an organization

A product change is a change in the organization’s product or service outputs.

A technology change is a change in the organization’s production process – how the organization does its work.


Coordination Model for InnovationCoordination Model for InnovationExhibit 11.3


Idea ChampionIdea Champion

A person who sees the need for and champions productive change within

the organization

Change does not occur by itself


Four Roles in Organizational ChangeFour Roles in Organizational Change

Exhibit 11.4


New Venture TeamsNew Venture Teams

New Venture Team = Unit separate from the mainstream of the organization that is responsible for developing and initiating innovations

Skunkworks = separate small, informal, highly autonomous, and often secretive group that focuses on breakthrough ideas for the business


New Venture Fund New Venture Fund

Fund providing resources from which individuals and groups can draw to develop new ideas, products, or businesses

Idea Incubator = in-house program that provides a safe harbor where ideas from employees throughout the organization can be developed without interference from company bureaucracy or politics


Model of Change Sequence of EventsModel of Change Sequence of Events

Exhibit 11.6


OD ActivitiesOD Activities

Survey feedback

Team building

Large group intervention


OD Approaches to Cultural ChangeOD Approaches to Cultural Change

Exhibit 11.5


Three Stages for Achieving Behavioral and Attitudinal Change

Three Stages for Achieving Behavioral and Attitudinal Change

Unfreezing

Changing

Refreezing


Forces for ChangeForces for Change

Environmental Forces– Customers– Competitors– Technology– Economic– International arena

Internal Forces – activities and decisions


Need for ChangeNeed for Change

Performance gap = disparity between existing and desired performance levels.

Current procedures are not up to standard

New idea or technology could improve current performance

Based on external or internal forces


Resistance to ChangeResistance to Change Self-Interest: fear of personal loss is perhaps the biggest

obstacle to organizational change Lack of Understanding and Trust: do not understand the

intended purpose of a change or distrust the intentions Uncertainty: lack of information about future events Different Assessments and Goals: people who will be

affected by innovation may assess the situation differently


Force-Field AnalysisForce-Field Analysis

The process of determining which forces drive and which resist a proposed change

Restraining Forces (Barriers)

•Lack of resources

•Resistance from middle managers

•Inadequate employee skills

Driving Forces

•Thought of as problems or opportunities that provide motivation for change

Kurt Lewin


Traditional to Just-In-Time Inventory Systems

Traditional to Just-In-Time Inventory Systems

Exhibit 11.7


Tactics for Overcoming Resistance to Change

Tactics for Overcoming Resistance to Change

Communication Education

Participation

Change is technical; users need accurate information & analysis

Users need to feel involved; design requires information from others; have power to resist

Approach When to Use


Tactics for Overcoming Resistance to Change (contd.)

Tactics for Overcoming Resistance to Change (contd.)

Negotiation

Coercion

Top management support

Group has power over implementation; will lose out in the change

Crisis exists; initiators clearly have power; other techniques have failed

Involves multiple departments or reallocation of resources; users doubt legitimacy of change

Approach When to use

Business

Managing Change and Innovation