Management CH. 7

Experiential approach to innovation

-A study of 72 product development projects (i.e., innovation) in 36 computer companies across the U.S., Europe, and Asia found that companies that succeeded in periods of discontinuous change (in which a technological discontinuity created a significant breakthrough in performance or function) typically followed an experiential approach to innovation -assumes that innovation is occurring within a highly uncertain environment, and that the key to fast product innovation is to use intuition, flexible options, and hands-on experience to reduce uncertainty and accelerate learning and understanding.

Components of creative work environment

-Challenging work -org. encouragement-of creativity occurs when management encourages risk taking and new ideas, supports and fairly evaluates new ideas, rewards and recognizes creativity, and encourages the sharing of new ideas throughout different parts of the company. -lack of org. impediments- remove impediments, internal conflict and power struggles, rigid structures, conservative bias toward the status quo can discourage creativity ex: best buy employees work on their own schedule -freedom- having autonomy over one's day to day work and sense of ownership and control over one's ideas -work group encouragement-when work group members have diverse experience, education, and backgrounds; when there is a mutual openness to ideas; when there is positive, constructive challenge to ideas; and when there is shared commitment to ideas. -supervisor encouragement-occurs when supervisors provide clear goals, encourage open interaction with subordinates, and actively support development teams' work and ideas

Manage Resistance to Change

-Educate and communicate -participation -negotiation -managerial support -coercion When resistance to change is based on insufficient, incorrect, or misleading information, managers should educate employees about the need for change and communicate change-related information to them. Managers must also supply the information and funding or other support employees need to make changes. Another way to reduce resistance to change is to have those affected by the change participate in planning and implementing the change process. Employees who participate have a better understanding of change and the need for it. Furthermore, employee concerns about change can be addressed as they occur if employees participate in the planning and implementation process. Employees are less likely to resist change if they are allowed to discuss and agree on who will do what after change occurs. Resistance to change also decreases when change efforts receive significant managerial support. Top managers must do more than talk about the importance of change. They must provide the training, resources, and autonomy needed to make change happen. Finally, use of formal power and authority to force others to change is called coercion. Because of the intense negative reactions it can create (i.e., fear, stress, resentment, sabotage of company products), coercion should only be used when a crisis exists or when all other attempts to reduce resistance to change have failed.

Managing Innovation During Discontinuous Change

-Experiential approach to innovation -Innovation is occurring within an uncertain environment  -the key to innovation is to use: intuition flexible options hands-on experience

Result driven change program

-create measurable, ST goals -use action steps -stress importance of immediate improvement -staffers should help managers/employees achieve quick improvement -test action steps to see if they yield improvement -takes few resources to get result driven change started

Managing Innovation

-source of innovation -during discontinuous change -during incremental change

General electric workout

3 day meeting that brings together managers and employees from diff. level and parts of org. to quickly generate and act on solutions to problems -While the GE Workout clearly speeds up change, it may fragment change, as different managers approve different suggestions in different town meetings across a company. By contrast, a transition management team provides a way to coordinate change throughout an organization.

Technology cycle

A cycle that begins with the "birth" of a new technology and ends when that technology reaches its limits and is replaced by a newer, better technology. ex: planes replaced trains as a means of cross country travel

Technological Discontinuity

A scientific advance or unique combination of existing technologies that creates a significant breakthrough in performance or function. ex: minimal invasive techniques are revolutionizing brain surgery, get tumor out in brain through eyebrow, use to have to cut open brain

Kinds of OD interventions

Organizational development interventions are aimed at changing large systems, small groups, or people. More specifically, the purpose of large system interventions is to change the character and performance of an organization, business unit, or department. The purpose of a small group intervention is to assess how a group functions, and help it work more effectively toward the accomplishment of its goals. The purpose of a person-focused intervention is to help people become aware of their attitudes and behaviors and acquire new skills and knowledge to increase interpersonal effectiveness.

Innovation Streams

Patterns of innovation over time that can create sustainable competitive advantage begins with technological discontinuity Technological Discontinuity--Discontinuous Change-[Technological substitution-Design competition]--Dominant Design

creative work environment

Workplace cultures in which workers perceive that new ideas are encouraged creativity is production of novel and useful ideas

Organizational Change

a difference in the form, quality, or condition of an organization over time.

Multifunctional teams

are work teams composed of people from different departments. Multifunctional teams accelerate learning and understanding by mixing and integrating technical, marketing, and manufacturing activities. By involving all key departments in development from the start, multifunctional teams speed innovation through early identification of problems that would typically not have been identified until much later

compression approach to innovation

assumes that innovation is a predictable process that can be planned in steps 5 aspects; planning, supplier involvement, shortening the time of indiv. steps, overlapping steps, multifunctional teams -goal when planning is to squeeze or compress development time as much as possible and create series of steps to accomplish goal

Generational change

based on incremental improvements are made to a dominant technological design such that the improved version of the technology is fully backward compatible with older version. Software is backward compatible if a new version of the software will work with files created by older version -So unlike technological discontinuities that result in the replacement of older technologies, generational change allows the old and newer versions of the same technological design to coexist in the marketplace. Because the compression approach assumes that innovation can follow a series of preplanned steps, one of the ways to shorten development time is supplier involvement. Delegating some of the preplanned steps in the innovation process to outside suppliers reduces the amount of work that internal development teams must do. Another way to shorten development time is to simply shorten the time of individual steps in the innovation process. One of the most common ways to do that is through computer-aided design (CAD). In a sequential design process, each step must be completed before the next step begins. But sometimes multiple development steps can be performed at the same time. Overlapping steps shortens the development process by reducing the delays or waiting time between steps.

Flow

challenging work promotes creativity because it creates a rewarding psychological experience known as "flow." Flow is a psychological state of effortlessness, in which you become completely absorbed in what you're doing and time seems to fly. (You begin work, become absorbed in it, and then suddenly realize that several hours have passed.) When flow occurs, who you are and what you're doing become one.

Incremental change

companies innovate by lowering cost and improving functioning and performance of the dominate design

Technological substitution

customers purchase new technologies to replace older ex: use to be pony express, then they didnt need that anymore b/c of telegram

design iteration

cycle of repetition in which a company tests a prototype of a new product or service, improves on the design, and then builds and tests the improved product or service prototype. A product prototype is a full-scale working model that is being tested for design, function, and reliability.

Five parts to the experiential approach to innovation

design iterations, testing, milestones, multifunctional teams, and powerful leaders.

Design competition

discontinuous change is characterized by this, old technology and several different new technologies compete to est. a new standard or design ex: HD Dvd players continued to sue technology for their collections, most people will eventually use Blu- ray b/c of the industry standards will dominate market

Dominant Design

discontinuous change is followed by emergence of this, becomes the new accepted market std. for technology ex: BD DVD and Blu-ray, HD lost design competition ex: move from the portable radio, to portable cassette player (Walkman), to portable CD player, to music being stored on computer chips in digital music players. emerges in these ways: -critical mass (most people use it) -solves a practical problem -independent standards bodies

Creativity

form of organizational innovation, is the production of novel and useful ideas.

Milestones

formal project review points used to assess progress and performance. By making people regularly assess what they're doing, how well they're performing, and whether they need to take corrective action, milestones provide structure to the general chaos that follows technological discontinuities. Milestones also shorten the innovation process by creating a sense of urgency that keeps everyone on task ex: company put itself on a 12 month schedule will have milestones at 3 6 and 9 months

Unfreezing

getting people affected by change to believe that change is needed What to do when employees resist change: -Share reasons for change w/ employees -Empathize about difficulties that change will create -Communicate the details simply, verbally, writting

Technological lockout

inability of a company to competitively sell its products b/c it relied on old technology or design

Resistance to change

is caused by self-interest, misunderstanding and distrust, and a general intolerance for change. People resist change out of self-interest, because they fear that change will cost or deprive them of something they value. For example, resistance might stem from a fear that the changes will result in a loss of pay, power, responsibility, or even perhaps one's job. People also resist change because of misunderstanding and distrust, that is, they don't understand the change or the reasons for it, or they distrust the people, typically management, behind the change. Ironically, when this occurs, some of the strongest resisters may support the changes in public, nodding and smiling their agreement, but then ignore the changes in private and just do their jobs as they always have. Management consultant Michael Hammer calls this deadly form of resistance the "Kiss of Yes."

kinds of OD interventions

large system: -sociotechnical system -survey feedback Small group: -team building -unit goal setting personal focused: -counseling/coaching -training

Result driven change

laser like focus on quickly measuring and improving resultsAnother advantage of results-driven change is that managers introduce changes in procedures, philosophy, or behavior only if they are likely to improve measured performance. In other words, managers actually test to see if changes make a difference. A third advantage of results-driven change is that quick, visible improvements motivate employees to continue to make additional changes to improve measured performance.

Change forces

lead to difference in the form, quality, or condition of an org. over time

change agent

person formally in charge of guiding a change effort , can be person from company or professional consultant

Organizational Development

philosophy and collection of planned change interventions designed to improve an org. LT health and performance -assumes that top management support is necessary for change to succeed, creates change by educating workers and managers to change ideas, beliefs, and behaviors so problems can be solved in new ways, and emphasizes employee participation in diagnosing, solving, and evaluating problems.

Technology cycle

point A on the S-curve- flat slope indicates that increased effort (i.e., money, research and development) brings only small improvements in technological performance. Intel's technology cycles have followed this pattern. Fortunately, as the technology matures, researchers figure out how to get better performance from the new technology. This is represented by point B of the S-curve- steeper slope indicates that small amounts of effort will result in significant increases in performance. point C- flat slope again indicates that further efforts to develop this particular technology will result in only small increases in performance. More importantly, however, point C indicates that the performance limits of that particular technology are being reached. In other words, additional significant improvements in performance are highly unlikely. After a technology has reached its limits at the top of the S-curve, significant improvements in performance usually come from radical new designs or new performance-enhancing materials. In Figure 7.2, that new technology is represented by the second S-curve. The changeover or discontinuity between the new and old technologies is represented by the dotted line. At first, the new and old technologies will likely co-exist. Eventually, however, the new technology will replace the old technology. When that happens, the old technology cycle will be complete and a new one will have started.

powerful leader

provide the vision, discipline, and motivation to keep innovation process focused, on time, and on target. Powerful leaders are able to get resources when they are needed, are typically more experienced, have high status in the company, and are held directly responsible for product success or failure

S curve pattern of innovation

slow initial progress, then rapid, then slow again as technology matures and reaches its limits

Organizational innovation

successful implementation of creative ideas in an organization

Resistance forces

support the status quo that is, the existing conditions in an org. ex: doctor says must change eating habit or die..and they dont change habit.. this happens in business

Refreezing

supporting and reinforcing the new changes so they "stick." Resistance to change, like that of Atwater's employees, is an example of frozen behavior. Given the choice between changing and not changing, most people would rather not change. Because resistance to change is natural and inevitable, managers need to unfreeze resistance to change to create successful change programs. The following methods, discussed on the next slide, can be used to manage resistance to change: education and communication, participation, negotiation, top management support, and coercion.

Testing

systematic comparison of different product designs or design iterations. Companies that want to create a new dominant design following a technological discontinuity quickly build, test, improve, and retest a series of different product prototypes.

Transition management team

team of 8 to 12 people whose full-time job is to manage and coordinate a company's change process. One member of the TMT is assigned the task of anticipating and managing the emotions and behaviors related to resistance to change. Despite their importance, many companies overlook the impact that negative emotions and resistant behaviors can have on the change process. Also, TMTs report to the CEO every day, decide which change projects are approved and funded, select and evaluate the people in charge of different change projects, and make sure that different change projects complement one another.

Discontinuous change

technological discontinuities are followed by this, characterized by technological substitution and design competition

Managers organizational change is basic process of ?

unfreezing change intervention refreezing

Errors Managers make when leading change

unfreezing: -no established sense of urgency -not powerful enough guiding coalition Change: -lacking vision -under-communicating vision -not removing obstacles to new vision -not planning for or creating short term wins Refreezing: -declaring victory to soon -not anchoring change in the corp. culture

Change Intervention

workers and managers change their behavior and work practices What to do when employees resist change: Explain benefits- what's in it for them Champion-identify manger to manage change effort Input- allow people to express their needs Timing- don't begin change at bad time Security- maintain to min. fear of change Training- offer training to ensure employees are confident Pace- change at a manageable pace, don't rush