Organisational Change

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ORGANIZATIONAL CHANGE

GROUP 6

Why change?Dynamic & competitive changing environment force organizations to change Change or die Models of Toyota, Tata

Types of Change

Organization v/s Sub-System Transformational v/s Incremental Remedial v/s Developmental Unplanned v/s Planned

Change TypesType I

That which is done to us.

Type II

That which we do to ourselves.

Type III

That which we do to others.

(Change Perception Model by Peter de Jager)

BASIC THEORIES OF CHANGE4 basic process theories of change. Characterized by event sequences: Life Cycle Theories:

Event Sequence: Start-up, Grow, Harvest, Terminate, Start-up

Teleological

Theories

Event Sequence: Set Goals, Implement Goals, Dissatisfaction, Search/Interact, Set Goals

Dialectical

Theories

Event Sequence: Thesis/Antithesis, Conflict, Synthesis, Thesis/Antithesis.

Evolutionary

Theories

Event Sequence: Variation, Selection, Retention, Selection.

Forces of changeChanging nature of workforce Multicultural

environment Aging labor force has different needs. Large expenditure on training manpower with inadequate skills- upgrade skills etc.

Technology Changing

Demands /Requirements / Needs Faster ,cheaper, smaller, ways to do things big organizations rooted in old ways need to buckle up.

Forces of changeEconomic shocks age of discontinuity Oil

prices, Dot com boom & bust Government Regulations. changes consumer patterns

Increasing Recession

Competition Global

economies- free trade- ever changing face & nature of competition - both innovators & traditional ones. today need to be nimble, quick on their feet , innovative - LEAN. & acquisitions.

Organizations Mergers

Forces of changeSocial Trends Internet

penetration more people interacting information sharing. Generations changing - so are the needs & habits rising no. of people shopping in discount stores looking for value for money

World Political environment Iraq , Afghanistan Taliban. Muslim fundamentalism 9/11, 26/11 New world markets emergence of BRIC Wars

Change needs to be plannedGenerally changes are unplanned If possible should be proactive , goal oriented & intentional. GOALs

Give the organization more flexibility to adapt to change. Change employee attitude/ behavior.Change Agent - manager / employee / outside consultant

Whos Responsible for Change

Source of functional conflict

Good- makes people think & debate but may hinder adaptation & progress.

Barriers to changeResistance

OvertThreat of strike Work slowdown Easy to handle best

ImplicitSubtle Loss of loyalty, motivation Increased error, Fall in productivity Difficult to handle.

DeferredClouds link between Source & Reaction of resistance Piles up & then explodes over non-issues.

Sources of Resistance (Individual)Habit / Routines Security /Threat to Security Economic factor especially if (change) tied to productivity Fear of unknown Selective information processing Individuals

hear & see what they want to Selective perception

Sources of Resistance(Organizational)Structural Inertia

Stability due to set / formalized procedures. Interdependent functions change in only one nullified by larger system . Group norms. Specialised group. Redistribution of decision making power.

Limited Focus of Change

Group Inertia

Threat to expertise

Threat to Established POWER Relationships

Threat to established resource allocation

Overcoming ResistanceEducation & Communication Tell

the Logic of change give full Facts misinformation sell need for change .

Fights Helps

Participation Opposing Improve

forces involved in decision making

quality & acceptability of change but also time consuming.

Overcoming ResistanceBuilding Support & Commitment Use

change agents

Employee

counseling, Therapy, New skill training, Short paid leave. key opposition backfire Give them an inch, theyll take a mile to change depends on personality

Negotiation With May

Select people who accept change Adaptation Take

people open to experience, risk takers, optimists

Overcoming ResistanceManipulation Covert influence attempt Twist

& Distort facts appear more attractive false rumor, withhold undesirable information.

Create

Cooptation buy off key leaders of resistance Give

them key role in change decision Get their endorsement threat / force transfer, loss of promotion

Coercion Direct

Generic SolutionsAdopt quality control measures Give power to each individualDefine roles Empower key personnel

Challenge people

Motivate them to change.

Eliminate unnecessary rules Increase interaction and cross functionality In all, grease the joints to prevent rusting Fire / Retrench people if required make space for new blood.

Change: FailureAccording to global research:More than 60% of the changes organizations try to implement, fail to achieve expectations. Many more require significantly more time and resources than their planners anticipated.

Source: (http://www.mclaganint.com/change/)

Mistakes In Implementing ChangeNot Building a Task Force Assuming Responses to Change Will be Unanimous Not Providing Enough Face Time

Honest, Open, Interpersonal effective in changing behaviour

dialogues

are

more

Not Sticking to the Vision Failing to Plan Small Successive Successes Underestimating importance of humans Treating change as an event and not as a process

Managing Organizational ChangeLEWINS THREE STEP MODEL

ACTION RESEARCH

Mc Kinsey 7-Step Model

KOTTERS 8 STEP MODEL

ORGANIZATION DEVELOPMENT

LEWINS MODEL: Unfreezing techniquesBurning platform: Expose or create a crisis Challenge: Inspire them to achieve remarkable thing Command: Just tell them to move! Evidence: Cold, hard data is difficult to ignore Destabilizing: Shaking people of their comfort zone Education: Learn them to chang Management by Objectives (MBO): Tell people what to do, but not how Restructuring: Redesign the organization to force behavior change Rites of passage: Hold a wake to help let go of the pas Setting goals: Give them a formal objective Visioning: Done well, visions work to create change Whole-system Planning: Everyone planning together

Transition TechniquesBoiling the frog: Incremental changes may well not be noticed. Challenge: Inspire them to achieve remarkable things. Coaching: Psychological support for executives. Command: Tell them what to do. Education: Teach them, one step at a time. Facilitation: Use a facilitator to guide team meetings. First steps: Make it easy to get going. Involvement: Give them an important role. Management by Objectives (MBO): Tell people what to do, but not how. Open Space: People talking about what concerns them. Re-education: Train the people you have in new knowledge/skills. Restructuring: Redesign the organization to force behavior change. Shift-and-sync: Change a bit then pause restabilize. Spill and fill: Incremental movement to a new organization. Stepwise change: breaking things down into smaller packages. Whole-system Planning: Everyone planning together.

Refreezing TechniquesBurning bridges: Ensure there is no way back. Evidence stream: Show them time and again that the change is real. Golden handcuffs: Put rewards in their middle-term future. Institutionalization: Building change into the formal systems and structures. New challenge: Get them looking to the future. Rationalization trap: Get them into action then help them explain their actions. Reward alignment: Align rewards with desired behaviors. Rites of passage: Use formal rituals to confirm change. Socializing: Build it into the social fabric.

Action Research Model

Kotters Eight-Step PlanEstablish a sense of urgency by creating a compelling reason for why change is needed Form a coalition with enough power to lead the change Create a new vision to direct the change and the strategies for achieving the vision Communicate the vision throughout the organization Empower others to act on the vision by removing barriers to change and encouraging risk taking and creative problem solving Plan for, create, and reward short-term wins that move the organization toward new vision Consolidate improvements, reassess changes, and make necessary adjustments in the new programs Reinforce the changes by demonstrating the relationship between new behaviors and organizational success.

Mc Kinsey 7-S Model

Mc Kinsey ModelStrategy

The direction and scope of the company over the long term. The basic organization of the company, its departments, reporting lines, areas of expertise, and responsibility (and how they inter-relate). Formal and informal procedures that govern everyday activity, covering everything from management information systems, through to the systems at the point of contact with the customer (retail systems, call centre systems, online systems, etc).

Structure

Systems

Mc Kinsey ModelThe 4Ss across the bottom of the model are less tangible, more cultural in nature, and were termed 'Soft Ss' by McKinsey: Skills:

The capabilities and competencies that exist within the company. What it does best. Shared values: The values and beliefs of the company. Ultimately they guide employees towards 'valued' behavior. Staff: The company's people resources and how they