Ch. 14: Organizational Change

Negative valence of change

employees resist change when they believe post-change situation will have more negative than positive outcomes (apply rational choice decision making model to estimate whether change will make them better or worse off) - Resistance increases when employes believe change does more harm than good

Leadership, Coalitions, and Pilot Projects

- 4 ingredients in effective change process: 1 Transformational Leadership and Change: key element of leading change is strategic vision > provides sense of direction and establishes critical success factors against which real changes are evaluated > Vision provides emotional foundation for change because it links individual's values and self-concept to desired change > Minimizes employee fear of unknown and provides better understanding of what behaviors employees must learn for future 2. Coalitions, Social Networks, and Change: change agents need assistance of several ppl > Guiding coalition: includes employees representing different functions and most levels of organization and are influencers who are highly respected by peers 3. Social Networks and Viral Change: structures of ppl connected to each other through one or more forms of interdependence > important role in communication and influence > Not easily controlled > Viral change: variation of word of mouth and viral marketing where information is seeded to few ppl and then spread to others through friendship connections > Social networks represent the channels through which news and opinions about change initiatives are transmitted > Provide opportunities for behavior observation

4-D Model of Appreciative Inquiry

- 4 stages: 1. Discovery: identifying positive elements of observed events or organization 2. Dreaming: envisioning what might be possible in ideal organization 3. Designing: participants listen with selfless receptivity to each other's views and assumptions and eventually form collective image for thinking within the team > create mental model of "what should be" 4. Delivering (destiny): participants establish specific objectives and direction for their own organization on basis of their model of "what will be"

Reducing the Restraining Forces

- 6 strategies for minimizing resistance to change: 1. Communication: highest priority and first strategy required; improves change process in 2 ways: > Communication generates urgency for change > Illuminating the future and reducing fear of the unknown 2. Learning: employees need new knowledge and skills to fit the organization's evolving requirements > not only helps employees perform better following change but it increases their readiness for change by strengthening their belief about working successfully in the new situation (change self-efficacy) 3. Employee involvement: employees feel more personal responsibility for successful implementation of the change; minimizes not invented here syndrome and fear of the unknown 4. Stress management: minimizes resistance by removing some of negative valence and fear of the unknown about change process; increases employee motivation to support change process 5. Negotiation: involves the promise of benefits or resources in exchange for the target person's compliance with the influencer's request > gains support from those who would lose out from change (may not be effective long term) 6. Coercion: if all else fails leaders rely on coercion; includes assertive influence behaviors like reminding ppl of obligations, monitoring behavior to ensure compliance, confronting ppl who don't change, using threats as punishment > Necessary when speed is essential and other tactics are ineffective > Risky bc survivors (employees who don't leave) may have less trust in corporate leaders and engage in more political tactics to protect their own job security

2 Approaches to Organizational Change

- Action Research Approach - Appreciative Inquiry Approach - Not always best strategy for change > depends on participants' ability to let go of problem-oriented approach and requires leaders who are willing to accept appreciative inquiry's less structured process - We don't know under what conditions appreciative inquiry is a useful approach to organizational change and under what conditions it's less effective - Can be effective approach but still discovering its potential and limitations

Lewin's Force Field Analysis Model

- Easy to see environmental forces pushing companies to change the way they operate - Force field analysis: Kurt Lewin's model of systemwide change that helps change agents diagnose the forces that drive and restrain proposed organizational change > One side represents driving forces that push organizations toward new state of affairs > new competitors or technologies, evolving client expectations, or a host of other environmental changes > Corporate leaders produce driving forces even when external forces for change aren't apparent > Other side of Lewin's model represents the restraining forces that maintain the status quo > "resistance to change" bc they appear to block the change process > Stability occurs when driving and restraining forces are in equilibrium - Model emphasizes effective change by unfreezing the current situation, moving to a desired condition, and then refreezing the system so it remains in desired state > Unfreezing: the first part of the change process, in which the change agent produces disequilibrium between the driving and restraining forces > Refreezing: the latter part of the change process, in which systems and structures are introduced that reinforce and maintain the desired behaviors

Unfreezing, Changing, and Refreezing

- Effective change occurs by unfreezing current situation, moving to desired condition, and then refreezing the system so it remains in this desired state - First option is to increase driving forces, which motivates employees to change through fear or threats > rarely works - Second option is to weaken or remove restraining forces > provides no motivation for change - Preferred option is to increase driving forces and reduce or remove restraining forces > Creates urgency for change, while lessening motivation to oppose change and removes obstacles - Creating an Urgency for Change > Change process needs to begin by making the external forces for change known to employees and explaining their seriousness for the organization's future > main driving forces in Lewin's model (push ppl out of their comfort zone, energizing them to face the risks that change creates) > Some companies fuel urgency for change by putting executives and employees in direct contact with customers > dissatisfied customers and stakeholders represent compelling driving force for change bc organization's survival depends on having customers who are satisfied with product or service > Creating an Urgency for Change without External Forces >> Challenge is greatest when companies are successful in their markets >> Creating urgency for change when organization is market leader requires a lot of persuasive influence that helps employees visualize future competitive threats and environmental shifts > employees may see this as manipulative, which produces cynicism about change and undermines trust in change agent >>> Motivation can develop through leader's vision of more appealing future >>> Future vision of better organization makes current situation less appealing

Refreezing the Desired Conditions

- Leaders need to refreeze new behaviors by realigning organizational systems and team dynamics with desired changes - Desired patterns of behavior are nailed down by changing physical structure and situational changes - Organizational rewards also refreeze behaviors - Information systems play complementary role as conduits for feedback which supports new behavior pattern in long term

Cross Cultural and Ethical Issues in Organizational Change

- Many practices are built around Western cultural assumptions and values which differ from and sometimes conflict with assumptions and values in other cultures - Ethical concern is the risk of violating individual privacy rights, some change activities may increase management's power by inducing compliance and conformity in members, some organizational change interventions undermine individual's self-esteem

Understanding Resistance to Change

- Most change agents are frustrated by passive or active resistance to their planned change > resistance is common and natural human response - Resistance is form of conflict, but change agents interpret that disagreement as relationship conflict > Describe ppl who resist as unreasonable, dysfunctional, and irrational reactionaries to desirable initiative > By perceiving situation as relationship change, change agents attack competence of those who resist change, further escalating conflict and generating even stronger resistance to change initiative - More productive approach is to view resistance to change as task conflict > resistance is signal that change agent hasn't prepared employees for change or that change initiative should be altered or improved - Resistance takes many forms and change agents need to decipher diff. types of resistance to understand underlying causes > Also form of voice for employees to discuss their concerns and improve procedural justice as well as decision making about the change > by redirecting initial forms of resistance into constructive conversations, change agents can generate a feeling of fairness among employees - Resistance is motivated behavior > engages ppl to think about change strategy and process and can harness motivational force to strengthen commitment to change initiative

Why Employees Resist Change

- Personality and values, lack sufficient motivation, ability, role clarity, or situational support to change attitudes, decisions, and behavior - Employee's readiness to change depends on 4 elements of MARS model > MARS elements are foundations of the 6 most commonly cited reasons for why ppl resist change: 1. Negative valence of change 2. Fear of the unknown 3. Not-invented-here syndrome 4. Breaking routines 5. Incongruent team dynamics 6. Incongruent organizational systems and structures

Pilot Projects and Diffusion of Change

- Pilot projects: introducing change to one work unit or section of the organization > tests effectiveness of and employee support for the transformation > More flexible and less risky than companywide initiative > Easier to select organizational groups with high readiness for change increasing likelihood transformation is successful - Change gets diffused from pilot projects to other parts of the organization by: > MARS model of individual behavior and performance >> Employees will adopt practices when they are motivated (when they see project is successful and ppl in project receive recognition and rewards) >> Diffusion also occurs more successfully when managers support and reinforce desired behaviors > change agents need to minimize sources of resistance to change >> Employees must have ability to adopt practices introduced in pilot project >> Pilot projects get diffused when employees have clear role perceptions > understand how practices in pilot project apply to them even though they are in completely different functional area > Employees require supportive situational factors to adopt practices in pilot project

Appreciative Inquiry Approach

- an organizational change strategy that directs the group's attention away from its own problems and focuses participants on the group's potential and positive elements > Deeply grounded in positive organizational behavior: a perspective or organizational behavior that focuses on building positive qualities and traits within individuals or institutions as opposed to focusing on what's wrong with them > Emphasizes building on strengths rather than trying to directly correct problems > Improves open dialogue by redirecting group's attention away from its own concerns > Actively frames reality in a way that provides constructive value for future development > Appreciative Inquiry Principles > 5 principles: 1. Positive 2. Constructionist: recognizes that questions we ask and language we use construct different realities 3. Simultaneity principle: inquiry and change are simultaneous, not sequential 4. Poetic: organizations are open books, so we have choices in how they're perceived, framed, and described > encourages change agents to actively frame reality in way that provides constructive value for future development 5. Anticipatory principle: recognizes that ppl are motivated and guided by an abstract vision of the future that's aligned with their personal values

Action Research Approach

a problem-focused change process that combines action orientation (changing attitudes and behavior) and research orientation (testing theory through data collection and analysis) > Action oriented bc ultimate goal is to improve workplace behaviors and practices > diagnosing current problems and applying interventions that resolve those problems > Adopts open systems view > Data-based, problem-oriented process that diagnoses need for change, introduces intervention, and evaluates and stabilizes the desired changes > Main phases of action research: >> Form client-consultant relationship: action research assumes change agent originates outside system (consultant) so process begins by forming client-consultant relationship > consultants need to determine client's readiness for change, including ppl are motivated to participate in process, are open to meaningful change, and possess abilities to complete process >> Diagnose the need for change: action research is problem oriented activity that carefully diagnoses the problems to determine appropriate direction for change effort > rely on systematic analysis of situation >> Introduce intervention: applies one or more actions to correct the problem >> Evaluate and stabilize change: action research recommends evaluating effectiveness of intervention against standards established in diagnostic stage > Some experts concerned that problem-oriented nature of action research focuses on negative dynamics of group or system rather than positive opportunities and potential > led to development of more positive approach (appreciative inquiry)

Not-invented-here syndrome

employees sometimes oppose or discreetly undermine organizational change initiatives that are introduced by ppl outside their group > most apparent among employees who are usually responsible for knowledge or initiative > To protect self worth, some employees inflate problems with changes they didn't initiate, just to "prove" that those ideas weren't superior to their own

Fear of the unknown

employees tend to assume the worst when they are unsure whether change will have good or bad outcomes - "Status quo bias" adds more negative valence to cost-benefit calculation

Breaking routines

ppl are creatures of habit and resist initiatives that require them to break automated routines and learn new role patterns > unless new patterns of behavior are strongly supported and reinforced, employees tend to revert to their past routines and habits

Incongruent organizational systems and structures

rewards, information systems, patterns of authority, career paths, selection criteria, and other systems and structures are both friends and foes of organizational change > When properly aligned, they reinforce desired behaviors; when misaligned, they pull ppl back into their old attitudes and behavior

Incongruent team dynamics

teams develop and enforce conformity to a set of norms that guide behavior > conformity may discourage employees from accepting organizational change