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
Lewin’s 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.
Kotter’s 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 don’t fit together and don’t 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 won’t 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.