Module 6 - Organizational Change

What are the four basic conditions needed for employees to change their behavior? (Keep in mind that this isn't actually a good model though, which is so great omg wow thanks business)

1. Compelling story (see the point of change and agree with it) 2. Role modeling (see colleagues and the CEO behaving in the same way) 3. Reinforcing mechanisms (systems, processes, and incentives must be in line with the new behavior) 4. Capacity building (employees must have the skills required to make the desired changes)

What are the eight stages of implementing organizational change?

1. Establish a sense of urgency 2. Form a powerful guiding coalition 3. Create a vision 4. Communicate the vision 5. Empower others to act on the vision 6. Plan for and create short-term wins 7. Consolidate improvements and produce change 8. Institutionalize new approaches

What are the four types of organizational change?

Adaptation (incremental/discrete) Re-Creation (revolutionary/discrete) Fine Tuning (incremental/continuous) Transformation (revolutionary/continuous)

Self-designed change

Aims to involve organizational members in the design and implementation of their own improvements. Emphasizes employee empowerment, self-managing teams, skill-based pay, gainsharing, flat hierarchy structures, and team-based selection practices. High involvement designs lead to high involvement strategy . Involvement in complex behavioral change models increases likelihood that the changes will actually occur.

How do you institutionalize new approaches?

Articulate connections between new behaviors and corporate successes; create leadership development and succession plans consistent with the new approach. Pitfalls: Not creating new social norms and shared values consistent with changes; promoting people into leadership positions who don't personify the new approach.

How do you form a powerful guiding coalition? (2)

Assemble a group with a shared commitment and enough power to lead a change effort; encourage the group to work together as a team outside of the normal hierarchy. Pitfalls: no prior experience of teamwork at the top, relegating team leadership to an HR, quality, or strategic-planning executive rather than a senior line manager

Incremental model

Change is a process in which individual parts of an organization deal incrementally and separately with one goal and one problem at a time. Over time, organizations change as the individual parts begin to change.

What are the forces that drive organizations to change?

Competitive environment, internal pressures, proliferating/rapidly changing technologies, changing workforce, political/economic changes

How do you create a vision? (3)

Create a vision to direct the change effort; develop strategies for realizing that vision. Pitfalls: Presenting a vision that's too complicated or too vague to be communicated in five minutes.

How do you plan for and create short term wins? (6)

Define and engineer visible performance improvements; recognize and reward employees contributing to those improvements. Pitfalls: Leaving short-term outcomes up to chance; failing to score successes early enough (1-2 years into the change effort)

Pitfalls of capability building

Employees are what they think, feel, and believe in. When trying to change employees, managers often ignore these factors, which ultimately drive behavior. Good intentions aren't enough. Create space for practicing new behaviors, not just talking about them.

Culture-Excellence approach (Peters and Waterman, Kanter)

Equates organizational success with a strong, appropriate organizational culture. Organizations needed to reconfigure, encourage spirit of innovation and organizational change. Detailed plans aren't possible, and flexibility is essential. Rejects Lewin's Planned approach to change as being too linear and static.

How do you establish a sense of urgency? (1)

Examine market and competitive realities; identify and discuss crises, potential crises, or major opportunities. Convince at least 75% of your managers that the status quo is more dangerous than the unknown. Pitfalls: underestimating the difficulty of driving people from their comfort zones; becoming paralyzed by risks.

What are the four main elements of Lewin's planned approach to change?

Field theory, Group dynamics, Action research, and the 3-step model

Continuous transformation model

In order to survive, organizations must have the ability to change themselves continuously in a fundamental way. Systems that are always on the edge of order and disorder exhibit the most prolific, complex, and continuous change (dynamic non-linear systems).

What are the two key dimensions of organizational change?

Incremental v. Revolutionary (how far is the organization from their goal/ideal state?) Discrete v. Continuous (how rapidly is the organization's competitive environment changing?)

Pitfalls of role modeling

Leaders mistakenly believe that they are the change, don't believe that there's anything they need to change about themselves. "Influence leaders" aren't a panacea for making change happen. Role/personality alone can't make an organization change holistically.

3-Step Model

Lewin saw the other three concepts as integrated in his 3-step process. Step 1: Unfreezing. Key is to recognize that change at individual & group level is a "profound psychological dynamic process". Three processes: dismantling the validity of the status quo, inducting guilt or survival anxiety, and creating psychological safety. Step 2: Moving. Unfreezing creates motivation to earn but does not control or predict the direction. Use Action Research method of change (trial and error). Research, action, research cycle enables groups to move from less acceptable to more acceptable set of behaviors. Step 3: Refreezing. Seek to stabilize group in new quasi-stationary equilibrium so the group doesn't regress. New behavior has to be somewhat congruent with old behavior standards, can't be totally foreign. Often requires changes to organizational culture, norms, policies, and practices.

Group Dynamics

Lewin. Importance of group in shaping individual behavior. Group is not linked through similarities, but rather their shared fate. Group behavior should be the focus of change, not individuals because individual behavior is constrained by group behavior. So, focus on group norms, roles, interactions, and socialization processes.

Field Theory

Lewin. Individual behavior is a function of group dynamics. Group dynamics are constantly in a state of flux due to outside behavior, but they also maintain a basic rhythm and pattern (quasi-stationary equilibrium). If you can identify the forces at hand in the group environment ("the field", so to speak) and isolate certain forces to diminish or strengthen, you can change the group dynamic, and by extension change individual behavior. The least understood of Lewin's postulates.

Designing high-involvement organizations

Made up of units or work teams that can function day-to-day without management control; all organization elements designed to promote and reinforce employee involvement. Created using self-design change model.

Pitfalls of reinforcing mechanisms

Money is the most expensive way to motivate people; difficult to link compensation to successes in change programs. Small, unexpected rewards can have a disproportionate effect. Process and the outcome have to be fair. Employees will go against self-interest if they feel that something that the organization is doing (to customers, for example) violates fairness.

Problems with programmed change

Only really works with problems limited in scope requiring minimal organizational change. Unlikely to lead to high levels of commitment to change among employees and stakeholders. Frequently results in conflict between designers and implementers of change (designers want total control, implementers want flexibility). Most significant issue is that it fails to improve organization's ability to implement future change, very narrow focus on a very narrow problem. Very dependent on staff experts, consultants, designers, and reduce manager/employee motivation to gain skills and knowledge.

Punctuated equilibrium model

Organizations evolve through long periods of stability punctuated by short bursts of fundamental change (equilibrium and revolutionary periods).

What are the forces that drive organizations to resist change?

People resistances (habit, learning new behaviors, security, fear of unknown) and organization resistances (strong organization culture, structural inertia, threats to power relationships, lack of funding or flexibility, poor leadership

Criticism 3: Lewin ignores the role of power and politics, and how conflict works in an organization.

Rebuttal: "No he doesn't" - author, basically

Criticism 4: Lewin advocates a top-down approach to change and ignores the need for bottom-up change.

Rebuttal: Lewin recognized pressure for change could come from anywhere, not just managers or bosses. However, no matter where it came from, the most important part of instituting change was that there was a "felt need" by everyone involved, and everyone was committed.

Criticism 1: Lewin's model is too simplistic, compared to a modern world of continuous, open-ended change processes.

Rebuttal: The criticisms misread how Lewin perceived stability and change. Lewin did understand limits of stability, and argued that social settings are in a state of constant change dictated by environment; adopted the same contextualized approach to change as critics.

Criticism 2: Lewin only addresses small scale-changes, and not radical, transformational change.

Rebuttal: This addresses speed of change more than magnitude (incremental change can lead to "transformational" over a long period of time). Research shows that under normal, non-critical circumstances, major behavioral changes don't stay in place unless instituted in incremental steps.

Processual approach

Reject prescriptive, recipe-driven approaches to change, wary of single causes/single explanations of problems. Focus instead on inner-relatedness of individuals, groups, organizations, or society. Change is a blend of rational decision processes, individual perception, political struggles, and coalition-building. Claim Planned approach doesn't pay enough attention to need to analyze and conceptualize organizational change; makes falsely neat starting and ending point.

How do you empower others to act on the vision? (5)

Remove or alter systems or structures undermining the vision; encourage risk-taking and non-traditional ideas, activities, and actions. Pitfalls: failing to remove powerful individuals who resist the change effort.

Programmed change

Resembles rational, problem-solving process; directed toward specific organizational problems like poor customer service or excessive costs or absenteeism. Managers/administrators seek maximum control over change process. Results in clearly-defined change with clear costs and expected results.

Steps for implementing self-designed change

Step 1: Laying the foundation. Initial foundation of knowledge and expertise on how the organization functions and how it can change. Make initial investment in time and resources. Step 2: Acquiring knowledge. Organizational members need to gain conceptual and practical knowledge to guide self-design efforts. Know organization frameworks and designs and how outside factors affect them. Step 3: Valuing. Probably the most important. Make the organization's values explicit and judge their relevance to competitive conditions. Will help uncover any underlying conflicts before the process begins. Step 4: Diagnosing. Assessing the organization or subunit against the values; collecting and analyzing information. May focus on strategy, competitive environment, work designs/structure. Step 5: Designing. Developing specific organizational changes to reduce value gaps. Explore new ways of organizing and working to create possible innovations. Organizational design is not deterministic; members understand they can make decisions and understand implications of their designs. Results in flexible change patterns. Step 6: Implementing and Assessing. Learning how to enact organizational change, and how to refine their method. Three levels of learning (single-loop learning: members focus on getting innovation in accordance with values; double-loop: involves changing the values, confront value inconsistencies; deutero learning: concerns learning how to learn, and how to improve their organizational skills).

Action Research

Two-pronged process which addresses: 1) what is the present situation, 2) what are the dangers, 3) what shall we do to address them? Change requires action, and action requires analyzing the situation correctly, identifying all possible solutions. Must be a "felt-need", i.e., individual inner realization that change is necessary. Based on Gestalt psychology, which stresses that change can only be successfully achieved by helping individuals reflect on their situation holistically. Routines and patterns have a specific role in a group and can be used to positively enforce group norms.

How do you communicate the vision? (4)

Use every possible vehicle to communicate the new vision and strategies for achieving it; teach new behaviors by example of the guiding coalition. Pitfalls: Under-communicating the vision, behaving in ways that are antithetical to the vision.

How do you consolidate improvements and produce more change? (7)

Use increased credibility from early wins to change systems, structures, and policies undermining the vision; hire, promote, and develop employees who can implement the vision; reinvigorate the change process with new projects and change grants. Pitfalls: declaring victory too soon (with the first performance improvement); allowing resistors to convince "troops" that the war has been won

Pitfalls of "creating a compelling story"

What motivates you doesn't necessarily motivate your employees. You have to appeal to things that matter to them personally, not to you or the company as a whole. You're better off letting them write their own story. When we choose for ourselves, we are more invested in the outcome. Involve everyone in your change design. It takes a story with a positive and a negative to create real energy. Bad models are solely deficit based (focuses on what's wrong and how to fix it) or constructionist based (discovery, dreaming, designing destiny; or, what could be/should be/might be etc.) Should incorporate aspects of both.

Characteristics of high-involvement organizations

flat and narrow organization structure, self-managed teams, open info systems, visionary leadership, employee empowerment, continuous training and development, culture-driven selection process, performance/skill-based reward system, strong and egalitarian work culture, good workforce accomodations