Chapter 8 Management

What is a product change?

A product change is a change in the organization's product or service outputs. Product and service innovation is the primary way in which organizations adapt to changes in markets, technology, and competition.

What is a sponsor?

The sponsor is a high-level manager who approves the idea, protects it, and removes major organizational barriers to acceptance.

Describe the second strategy-Cooperation

The strategy of cooperation refers to creating conditions and systems to facilitate internal and external coordination and knowledge sharing. Horizontal coordination mechanisms, Customer/Partners; Open innovation

What is disruptive innovation?

Disruptive innovation refers to innovations in products, services, or processes that radically change an industry's rules of the game for producers and consumers.

How are driving forces defined under the force field technique as a strategy to address employee resistance to change?

Driving forces can be thought of as problems or opportunities that provide motivation for change within the organization.

What is the horizontal linkage model?

The model shows that the research, manufacturing, and sales and marketing departments within an organization simultaneously contribute to new products and technologies. People from these departments meet frequently in teams and task forces to share ideas and solve problems. Research people inform marketing of new technical developments to learn whether they will be useful to customers. Marketing people pass customer complaints to research to use in the design of new products and to manufacturing people to develop new ideas for improving production speed and quality. Manufacturing informs other departments whether a product idea can be manufactured within cost limits.

What is a fast cycle team?

A fast-cycle team is a multifunctional, and sometimes multinational, team that works under stringent timelines and is provided with high levels of resources and empowerment to accomplish an accelerated product development project.

What is a skunkworks?

A skunkworks is a separate small, informal, highly autonomous, and often secretive group that focuses on breakthrough ideas for the business. The essence of a skunkworks is that highly talented people are given the time and freedom to let creativity reign. The laser printer was invented by a Xerox researcher who was transferred to a skunkworks, the Xerox Palo Alto Research Center (PARC), after his ideas about using lasers were stifled within the company for being "too impractical and expensive."

What is a technology change?

A technology change is a change in the organization's production process—how the organization does its work. Technology changes are designed to make the production of a product or service more efficient.

What is an ambidextrous approach in management innovation?

An ambidextrous approach means incorporating structures and processes that are appropriate for both the creative impulse and for the systematic implementation of innovations. With an ambidextrous approach, managers encourage flexibility and freedom to innovate and propose new ideas with creative departments, venture teams, and other mechanisms we will discuss in this chapter, but they use a more rigid, centralized, and standardized approach for implementing innovations.

What is an idea incubator?

Another popular way to encourage new ideas within the organization is the idea incubator. An idea incubator provides a safe harbor where ideas from employees throughout the company can be developed without interference from company bureaucracy or politics.

How does different assessments and goals make employees resistant to change?

Another reason for resistance to change is that people who will be affected by an innovation may assess the situation differently from an idea champion or new-venture group. Critics frequently voice legitimate disagreements over the proposed benefits of a change. Managers in each department pursue different goals, and an innovation may detract from performance and goal achievement for some departments.

Explain the use of selective implementation tactics to overcome employee resistance to change.

Communication and education are used when solid information about the change is needed by users and others who may resist implementation. Education is especially important when the change involves new technical knowledge or users are unfamiliar with the idea. Participation involves users and potential resisters in designing the change. This approach is time consuming, but it pays off because users understand and become committed to the change. Negotiation is a more formal means of achieving cooperation. Negotiation uses formal bargaining to win acceptance and approval of a desired change. Coercion means that managers use formal power to force employees to change. Resisters are told to accept the change or lose rewards or even their jobs. One survey found that 80 percent of companies that are successful innovators have top executives who frequently reinforce the importance of innovation both verbally and symbolically.Footnote The visible support of top management helps overcome resistance to change. For instance, one of the primary correlates of the success of new business ventures is the strong support of top managers, which gives the project legitimacy.Footnote Top management support symbolizes to all employees that the change is important for the organization.

What are the characteristics of a company that can successfully innovate?

Companies that successfully innovate usually have the following characteristics: People in marketing have a good understanding of customer needs. Technical specialists are aware of recent technological developments and make effective use of new technology. Members from key departments—research, manufacturing, marketing—cooperate in the development of the new product or service.

What is creativity within the process of exploration?

Creativity refers to the generation of novel ideas that might meet perceived needs or respond to opportunities for the organization.

What is crowd sourcing?

Crowdsourcing, an open innovation approach used by Threadless and other companies, taps into ideas from around the world and lets thousands or hundreds of thousands of people participate in the innovation process, usually via the Internet.

What does the term culture change refer to?

Culture change pertains to the organization as a whole, such as when the IRS shifted its basic mind-set from an organization focused on collection and compliance to one dedicated to informing, educating, and serving customers (taxpayers).

Describe the first strategy-exploration.

Exploration is the stage where ideas for new products and technologies are born. Managers design the organization for exploration by establishing conditions that encourage creativity and allow new ideas to spring forth.

What are three critical innovation strategies for changing products and technologies?

Exploration; Cooperation & Entrepreneurship

Describe the third strategy-Entrepreneurship

Finally, entrepreneurship means that managers put in place processes and structures to ensure that new ideas are carried forward for acceptance and implementation. Idea Champions; New Venture Teams; Skunkworks; & New Venture Fund

What were the eight Whchange steps recommended by Professor Kotter?

Harvard professor John P. Kotter established an eight-step plan for implementing change that can provide a greater potential for successful transformation of a company: Establish a sense of urgency through careful examination of the market and identification of opportunities and potential crises. Form a powerful coalition of managers able to lead the change. Create a vision to direct the change and the strategies for achieving that vision. Communicate the vision throughout the organization. Empower others to act on the vision by removing barriers, changing systems, and encouraging risk taking. Plan for and celebrate visible, short-term performance improvements. Consolidate improvements, reassess changes, and make necessary adjustments in the new programs. Articulate the relationship between new behaviors and organizational success.

What do managers actually do?

In essence, managers set goals, organize activities, motivate and communicate, measure performance, and develop people.

Why does innovative management matter?

Innovations in products, services, management systems, production processes, corporate values, and other aspects of the organization are what keep companies growing, changing, and thriving.

What are the typical four roles in organizational change?

Inventor, champion, sponsor, & critic

What is open innovation?

Open innovation means extending the search for and commercialization of new ideas beyond the boundaries of the organization and even beyond the boundaries of the industry.

What is organizational development?

Organization development (OD) is a planned, systematic process of change that uses behavioral science knowledge and techniques to improve an organization's health and effectiveness through its ability to adapt to the environment, improve internal relationships, and increase learning and problem-solving capabilities. OD focuses on the human and social aspects of the organization and works to change attitudes and relationships among employees, helping to strengthen the organization's capacity for adaptation and renewal

What is organizational change?

Organizational change is defined as the adoption of a new idea or behavior by an organization.

What does the term people change refer to?

People change concerns just a few employees, such as sending a handful of middle managers to a training course to improve their leadership skills

How does self interest make employees resistant to change?

People typically resist a change they believe conflicts with their self-interests. A proposed change in job design, structure, or technology may increase employees' workload, for example, or cause a real or perceived loss of power, prestige, pay, or benefits. The fear of personal loss is perhaps the biggest obstacle to organizational change.

Why is having an idea champion so important to the success of a product?

Research confirms that successful new ideas are generally those that are backed by someone who believes in the idea wholeheartedly and is determined to convince others of its value.

How are restraining forces defined under the force field technique as a strategy to address employee resistance to change?

Restraining forces are the various barriers to change, such as a lack of resources, resistance from middle managers, or inadequate employee skills.

What are the two strategies that can be used to combat employee resistance to change?

Strategies for overcoming resistance to change typically involve two approaches: the analysis of resistance through the force-field technique and the use of selective implementation tactics to overcome resistance.

What are the reasons that employees are resistant to change?

Self interest; Lack of understanding and trust; Uncertainty; Different assessments and goals;

What is an idea champion?

The formal definition of an idea champion is a person who sees the need for and champions productive change within the organization.

What is a champion?

The champion believes in the idea, confronts the organizational realities of costs and benefits, and gains the political and financial support needed to bring it to reality.

What is a critic?

The critic counterbalances the zeal of the champion by challenging the concept and providing a reality test against hard-nosed criteria. The critic prevents people in the other roles from adopting a bad idea.

How does uncertainty make employees resistant to change?

Uncertainty is the lack of information about future events. It represents a fear of the unknown. Uncertainty is especially threatening for employees who have a low tolerance for change and fear anything out of the ordinary. They do not know how a change will affect them and worry about whether they will be able to meet the demands of a new procedure or technology.

How does a company use training programs to change people's mindsets?

Training is one of the most frequently used approaches to changing people's mind-sets. A company might offer training programs to large blocks of employees on subjects such as teamwork, diversity, emotional intelligence, quality circles, communication skills, or participative management.

How is the need for change defined?

A need for change is a disparity between existing and desired performance levels.

What is a new venture fund?

A new-venture fund provides resources from which individuals and groups can draw to develop new ideas, products, or businesses.

What is a new venture team?

A new-venture team is a unit separate from the rest of the organization that is responsible for developing and initiating a major innovation. New-venture teams give free rein to members' creativity because their separate facilities and location unleash people from the restrictions imposed by organizational rules and procedures. These teams typically are small, loosely structured, and flexible.

How does a lack of understanding and trust make employees resistant to change?

Employees often distrust the intentions behind a change or do not understand the intended purpose of a change. If previous working relationships with an idea champion have been negative, resistance may occur.

Explain the analysis of resistance through the force field technique as a strategy for employee resistance to change.

Force-field analysis grew from the work of Kurt Lewin, who proposed that change was a result of the competition between driving and restraining forces. Driving forces can be thought of as problems or opportunities that provide motivation for change within the organization. Restraining forces are the various barriers to change, such as a lack of resources, resistance from middle managers, or inadequate employee skills. When a change is introduced, management should analyze both the forces that drive change (problems and opportunities) as well as the forces that resist it (barriers to change). By selectively removing forces that restrain change, the driving forces will be strong enough to enable implementation

What are the characteristics of a creative organization or department?

The Creative Organization or Department 1. Conceptual fluency Open-mindedness 1. Open channels of communication Contact with outside sources Overlapping territories; cross-pollination of ideas across disciplines Suggestion systems, brainstorming, freewheeling discussions 2. Originality 2. Assigning nonspecialists to problems Eccentricity allowed Hiring outside your comfort zone 3. Less authority Independence Self-confidence 3. Decentralization, loosely defined positions, loose control Acceptance of mistakes; rewarding risk-taking People encouraged to challenge their bosses 4. Playfulness Undisciplined exploration Curiosity 4. Freedom to choose and pursue problems Not a tight ship, playful culture, doing the impractical Freedom to discuss ideas; long time horizon 5. Persistence Commitment Focused approach 5. Resources allocated to creative personnel and projects without immediate payoff Reward system encourages innovation Absolution of peripheral responsibilities

What is an inventor?

The inventor comes up with a new idea and understands its technical value but has neither the ability nor the interest to promote it for acceptance within the organization.