Organisational Change

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Organisational Change. Key Knowledge Concept of organisational change Internal & external pressures as a source of change Driving & restraining forces for change. Strategies for effective change management – low risk and high risk practices Kotter theory of change management - PowerPoint PPT Presentation

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Lalor Secondary CollegeOrganisational ChangeKey KnowledgeConcept of organisational changeInternal & external pressures as a source of changeDriving & restraining forces for changeLalor Secondary CollegeStrategies for effective change management low risk and high risk practicesKotter theory of change managementProcess for effective change managementRole of leadership in managing change

Lalor Secondary CollegeThe concept of organisational changeWhat is change?

How employees feel about change.Lalor Secondary College

Lalor Secondary CollegePressures for changeSee pages 286-292Pressures on LSOs include;Internal Corporate culturePoliciesManagementEmployees

Lalor Secondary CollegeExternal pressures for changeOperating environmentCustomersSuppliersCompetitorsCreditorsTrade unionsLalor Secondary CollegeExternal pressures for changeMacroEconomicPoliticalSocial & demographicTechnologicalInternationalGeographicEnvironmental Lalor Secondary CollegeLewin force field analysishttp://www.youtube.com/watch?v=hBycYu7T5WY&feature=player_detailpage Lalor Secondary College

Lalor Secondary CollegeDriving & restraining forces for changeForce field analysis looks at the forces that are either driving movement towards a change or goal or are blocking (restraining) movement towards a change or goal.Lalor Secondary CollegeForces for changeDriving forces supportive cultureParticipative management styleCommunication** See Table 13.2 page 294Restraining forcesApathyHostilityPoor working conditions

Lalor Secondary CollegeKotters Change TheoryThere are eight steps to Kotters theory (you have to know all of them).These are;Establish a sense of urgencyAssemble a group of people who will lead the changeCreate a vision for the organisation

Lalor Secondary College4. Communicate the vision to all within the organisation5. Empower others to act on the vision.6. Plan to achieve short-term gains and wins rather than large instant changes.Lalor Secondary College7. Consolidate all of the changes. Dont let up.8. Institutionalise the new approaches and create the new cultures. Reinforce change through recruitment, promotion & appointment of new change leaders.

Lalor Secondary CollegeKotterhttp://www.youtube.com/watch?v=ijCuvSejKD0&feature=player_detailpagehttp://www.youtube.com/watch?v=W0EGhBlJK8o&feature=player_detailpagehttp://www.youtube.com/watch?v=F9hbX6bLwd4&feature=player_detailpage http://www.youtube.com/watch?v=7ohEBDLPaTE&feature=player_detailpage Lalor Secondary CollegeElvis Presley/VCE/WIIE (establish the need)P (put together a guiding team)V (vision)C (Communication)E (empower others)W (wins & celebrate)I (I dont let up)I (institutionalise)

Lalor Secondary CollegeYou need to be able to explain and apply Kotter to a scenario (see the examples & activities in class). Exam question worth 10 marksComplete Activity 13.6 page 296Lalor Secondary CollegeLow-risk and high-risk practices (tactics) for changeOrganisations should try to use low-risk practices when bringing about change.These include;Two-way communicationEmpowerment of employeesEstablish work teamsSupport for others

Lalor Secondary CollegeHigh-risk practices include;Coercion and threatsManipulation of the situation eg. leave out certain facts and information.Use of an autocratic management styleOne-way communication & decision making; employees are told what to do.Lalor Secondary CollegeLow-risk and high-risk practices can be linked to Kotters change theory.

Lalor Secondary CollegeTactics for changeEducate the leaders to ensure that they understand what the change is.Use a systems approach to ensure all aspects are considered.Use a team approachMake plans but also allow for flexibility.Share power with others.Lalor Secondary College6. Tension between change and implementation.7. Provide training & staff development8. Innovative practices9. Change only happens through people10. Be prepared for implementation dip11. Help employees develop an intellectual understanding of the new practices.12. Take the long term view.

Lalor Secondary CollegeThe role of leadership in the change processWhat skills do leaders and managers need?List at least five different skills (from Unit Three) a leader and manager would need to have.Lalor Secondary CollegeLeaders are critical in the change process. They need to be able to;Diagnosing understand the situation & knowing what could be expected in the future.Adapting change & adapt behaviour & resources.Communicating communicate & share what has to be done.

Lalor Secondary CollegeImpact of change on LSOsChanges to internal environment, OM & HRM StructureBusiness many expand through mergers, takeovers and acquisitionLalor Secondary CollegeMay be horizontal or vertical integration of the organisationUnprofitable parts of the business may be sold offSome departments may be relocated interstate or overseasFlatter organisational structures with fewer levels of management are more likely.Non-core business activities may be outsourced

Lalor Secondary CollegeBusiness operations may be diversifiedClosing some older plantsCorporate cultureChanges to the size of the workforce may mean existing employees are negative about the futureChanges in tasks and jobs may impact on culture.Lalor Secondary CollegePolicyNews methods and structure may mean that the organisation develops policies and procedures in areas such as recruitment & selection, training, codes and contracts with suppliers.

Lalor Secondary CollegeManagement styles, skills and rolesEffective change may mean the use of consultative and participative styles use of two way communication, group decision making and decentralised authority.Need for skills such as interpersonal/communication skills, decision making, delegation and vision.Focus on roles of Planning & Leading through the change process.Lalor Secondary CollegeNeed for Controlling and Organising ensure that the change process has been implemented and evaluated.Changes to the operations management function Emphasis on work groups of teamsNew plant and equipmentIntroduction of programs such as Total Quality Management (TQM)Lalor Secondary CollegeIntroduction of new value added programsPressure on organisations to use green technology to lessen the impact on the environmentNew technology training and equipmentNew production methods Changes to the human resource function Downsizing may lead to a reduction in the number of staff

Lalor Secondary CollegeDecentralisation of power, decision making and accountability with more emphasis on employeesChanging jobs and tasksEmployees may become multiskilledHR managers will need to recruit staff with the right skill set and manage ways to provide career paths and retain talented and skilled employeesLalor Secondary CollegeNew ways of performing tasks and training programs may be introducedMany job descriptions and tasks will change as a result of change within the organisationUse of modern awards & EBAs and industry awards.Legislative changes such as occupational health and safety, equal opportunity and affirmative action

Lalor Secondary CollegeAppointment of new senior managers, new management styles and new corporate culture Legislative changes such as occupational health and safety, equal opportunity and affirmative actionAppointment of new senior managers, new management styles and new corporate culture

Lalor Secondary College2010 VCAA exam question how would you answer this? Question 7Managing change is a vital part of ensuring the success of a large-scale organisation. Analyse possible driving and restraining forces which might cause change in a large-scale organisation. Illustrate your answer with references to an issue or organisation that you have studied this year. (10 marks = 40 lines)

Lalor Secondary College