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Organisational Culture and Change Professor Ming Sun School of Energy, Geoscience, Infrastructure & Society Heriot-Watt University

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  • Organisational Culture and Change

    Professor Ming Sun

    School of Energy, Geoscience, Infrastructure & Society

    Heriot-Watt University

  • ORGANISATION CULTURE

  • What is Culture?

    Culture is a set of values, attitudes, beliefs,

    and meanings that are shared by the members

    of a group or organisation.

    It is often the primary way in which one group

    (organisation, team, etc.) differentiates itself

    from others.

  • Organisational Culture Defined

    Reflects the underlying assumption about the way work is performed, what is acceptable and not acceptable, and what behaviour and actions are encouraged and discouraged

    Atkinson

    The collection of traditions, values, beliefs, and attitudes that constitute a pervasive context for everything we do and think in an organisation.

    McLean & Marshall

  • Henry Mintzberg on Culture

    Culture is the soul of the organization the

    beliefs and values, and how they are

    manifested. I think of the structure as the

    skeleton, and as the flesh and blood. And

    culture is the soul that holds the thing together

    and gives it life force.

  • Chapter 10, Nancy Langton

    and Stephen P. Robbins,

    Fundamentals of

    Organizational Behaviour,

    Third Canadian Edition

    10-6

    Copyright 2007 Pearson

    Education Canada

    Organizational Culture

    The pattern of shared values, beliefs, and

    assumptions considered to be the appropriate

    way to think and act within an organization.

    Culture is shared.

    Culture helps members solve problems.

    Culture is taught to newcomers.

    Culture strongly influences behaviour.

  • Culture and Behaviour

    Williams & Dobson

  • Culture Types

    Harrison & Handy

  • Culture Types according to Deal & Kennedy

    Tough-guy, macho culture

    police departments, construction, management consulting

    Work-hard / play-hard culture

    estate agents and computer companies, mass consumer

    companies

    Bet-your-company culture

    oil companies, investment banks

    Process culture

    insurance companies, financial services, and the civil service

  • Influencing Factors on Organisational

    Culture

    Organizational

    characteristics:

    Size and age

    Founders values

    New managers values

    Subordinates values.

    Management:

    Strategy and structure

    Leadership

    Personnel management.

    Operation:

    Task

    Technology.

    Environment:

    External

    Internal.

  • MANAGING CHANGE

    It is not the strongest species that survive, nor the most intelligent,

    but the ones who are most responsive to change - Charles Darwin

  • Internal Drivers of Organisational

    Change

    The need for performance improvement

    Adoption of new technology

    Changes in staff

    Changes to business processes

    New ways of working and management

  • External Drivers of Organisational

    Change

    Uncertain economic conditions

    Globalisation and fierce competition

    Regulatory requirements

    Technological advances

    Demands of sustainable development

    Mergers and acquisitions

    Changes in customers demands

  • Benefits of Embracing Change An

    Organisation Perspective Change provides opportunity for business growth.

    It gives the opportunity to develop solid strategic planning and tactical manoeuvres.

    It can create more efficient processes and systems.

    It enables organisations to adapt and respond quicker than competition.

    It reduces the status quo mentality.

    It promotes system thinking and long term vision.

    It brings on innovation.

    It encourages proactive approach to risk management.

    It's a lot more interesting than something that is static and stable all the time.

  • Benefits of Embracing Change An

    Individual Perspective Change provides personal growth, through learning new skills.

    It makes people more adaptable to new situations, new

    environments, and new people.

    It provides opportunity for improvement in personal life.

    Changes bring new beginnings and excitement to life.

  • Refreezing Moving Unfreezing

    Creating

    the

    motivation

    to change

    Learning

    new

    concepts &

    meanings

    Internalizing

    new

    concepts &

    meanings

    Lewins 3-Step Change Model

  • Step 1: Unfreezing

    Launch change efforts to overcome the pressures of individual resistance and group conformity Arouse dissatisfaction with the current state

    Bring in disconfirming information

    Help people unlearn conventional wisdom

  • Step 2: Moving

    Get employees involved in the change process Establish goals

    Activate and reinforce top management support

    Recruit and empower change agents

    Encourage participatory decision-making

    Institute smaller, acceptable changes that reinforce and support change

    Reward and celebrate success

    Maintain open, two-way communication

  • Step 3: Refreezing

    Stabilize the change intervention by rebalancing driving and restraining forces.

    Build success experiences.

    Reward desired behaviour.

    Develop structures to institutionalize the change.

    Make change work.

  • Kotters Eight-Step Plan for

    Implementing Change 1. Establish a sense of urgency

    2. Build a guiding team

    3. Create a new vision

    4. Communicate the vision

    5. Empower others to act

    6. Develop short-term wins

    7. Consolidate improvements

    8. Reinforce changes

    Source: Based on J. P. Kotter, Leading Change (Boston: Harvard Business School Press, 1996).

    UNFREEZING

    MOVING

    REFREEZING

  • 1. Establish a Sense of Urgency

    Examining the market and

    competitive realities

    Identifying and discussing crises,

    potential crises, or major

    opportunities

  • 2. Build a Guiding Team

    Putting together a group with enough

    power to lead the change

    Getting the group to work together

    like a team

  • 3. Create a New Vision

    Creating a vision to help direct the

    change effort

    Developing strategies for achieving

    that vision

  • 4. Communicate the Vision

    Using every vehicle possible to constantly

    communicate the new vision & strategies

    Having the guiding coalition role model

    the behavior expected of employees

  • 5. Empower Others to Act

    Getting rid of obstacles

    Changing systems or structures that

    undermine the change vision

    Encouraging risk taking and

    nontraditional ideas, activities, and

    actions

  • 6. Develop Short-term Wins

    Planning for visible improvement in

    performance or wins

    Creating those wins

    Visibly recognizing and rewarding

    people who made the wins possible

  • 7. Consolidate Improvements

    Using increased credibility to change all systems, structures, and policies that dont fit together and dont fit the transformation vision

    Hiring, promoting, and developing people who can implement the change vision

    Reinvigorating the process with new projects, themes, and change agents

  • 8. Anchoring New Approaches in

    the Culture Creating better performance through

    customer and productivity oriented

    behavior, more and better leadership,

    and more effective management

  • 8. Reinforce changes

    Articulating the connections between new

    behaviors and organizational success

    Developing means to ensure leadership

    development and succession

  • Sources of Individual Resistance

    to Change Selective perception: Staffs tend to be sceptical about manager-driven

    change programs.

    Established habits. Changes may require them to change their existing

    habits. This is not easy.

    Loss of freedom: People may perceive that the introduced changes will

    cause inconvenience or loss of freedom for themselves.

    Economic loss: People are likely to resist change that is perceived as

    reducing their pay and other rewards.

    Loss of security: Existing ways of working give people comfort and sense

    of security. Changes will bring in new ideas and new methods. Some

    people would rather stick to the old ways.

    People may resist change simply for the fear of the unknown.

  • Sources of Organisational

    Resistance to Change Organisation culture tends to be developed over a long period of time;

    change of culture is not easy.

    Organisations, especially large ones, need formal rules and procedures to maintain stability and standard of performance. Such a need for maintaining stability often creates resistances to necessary change.

    Implementing change usually requires investment of resources in money and staff time. These are not always made available.

    At any time, an organisation would have many commitments to external stakeholders in the form of contracts and agreements. These may impose constraints on the speed and scale of changes the organisation can undertake.

    Changes, especially structural changes, can reduce the power and influence of certain groups inside the organisation. If that is the case, the affected groups will resist the changes.

  • Overcoming Resistance to

    Change Kotter and Schlesinger proposed a six Approach

    Model to deal with change resistance:

    1. Education and communication

    2. Participation and involvement

    3. Facilitation and support

    4. Negotiation and agreement

    5. Co-optation and manipulation

    6. Explicit and implicit coercion

  • Education and Communication

    Assumes source of resistance lies in misinformation or poor communication.

    One of the best ways to overcome resistance to change is to educate people about the change effort beforehand. Up-front communication and education helps employees see the logic in the change effort. This reduces unfounded and incorrect rumours concerning the effects of change in the organization.

    Best used: When information is lacking or is inaccurate.

  • Participation and Involvement

    Prior to making a change, bring opponents into the process.

    When employees are involved in the change effort they are more likely to buy into change rather than resist it. This approach is likely to lower resistance more so than merely hoping people will acquiesce to change.

    Best used: Where initiators lack information, and others have power to resist.

  • Facilitation and Support The provision of various efforts to facilitate adjustment.

    Managers can head-off potential resistance by being

    supportive of employees during difficult times.

    Managerial support helps employees deal with fear and

    anxiety during a transition period. This approach is

    concerned with provision of special training,

    counselling, time off work.

    Best used: Where people resist because of adjustment

    problems.

  • Negotiation and Agreement Exchange something of value in exchange for lessening of

    resistance.

    Managers can combat resistance by offering incentives to

    employees not to resist change. This can be done by allowing

    change resistors to veto elements of change that are threatening,

    or change resistors can be offered incentives to go elsewhere in

    the company in order to avoid having to experience the change

    effort. This approach will be appropriate where those resisting

    change are in a position of power.

    Best used: Where one group will lose, and has considerable

    power to resist.

  • Co-optation and manipulation Twisting and distorting facts to make them appear more

    attractive.

    Co-optation involves the patronizing gesture of bringing a person into a change management planning group for the sake of appearances rather than their substantive contribution. This often involves selecting leaders of the resisters to participate in the change effort. These leaders can be given a symbolic role in decision making without threatening the change effort.

    Best used: Where other tactics wont work or are too expensive.

  • Explicit or Implicit Coercion

    Use or threat of force or punishment on

    resisters.

    Managers can explicitly or implicitly force

    employees into accepting change by making

    clear that resisting change can lead to losing

    jobs, firing, or not promoting employees.

    Best used: When speed is essential, and

    initiators have power.

  • Expected Learning Outcomes

    Students should know about organisational culture and the

    common types of culture;

    Students should know the main factors that influence

    organisational culture;

    Students should understand the benefits and main drivers of

    organisational change;

    Students should know the main barriers to organisation

    change at both individual and organisation levels

    Students should know the steps of successful organisational

    change, as suggested by Kotter and Cohen.