Organizational change

From CEOpedia | Management online

The term organizational change describes everything that implies a violation of the initial situation (status quo) of organization, in any functional area. So every transformation within the system or in its environment, which leads to situation, which differs from the initial condition is called change.

Organizational change involves all important alterations of company function and structure. These modifications in enterprise system are done in accordance with established procedures and may relate to its various parts. The change occurs wherever there is a need for it. Ability to adjust the pace of change and methods of their introduction is important competence for every manager.

Conditions of the functioning of modern organizations made it necessary to develop the ability to permanently adapt by making organizational changes. Key factor in creating a competitive advantage has become the ability to quickly identify changes occurring in the environment.

Because the need for change is conditioned internally (due to economic, technological and social challenges) and externally (due to evolution of culture, new relationships, changing attitudes, growing experience) detachment of change process from current functioning of the organization is not feasible in practice. The process of implementing change usually happen in parallel with the normal activities of the organization.

If the changes are pre-conscious and deliberate (need to improve the functioning of the system) they are called innovation. Innovation always is change, but not every change is innovation.

Organizational change process

Force field theory by K. Lewin explains the progress of the changes. This is a three-stage process. According to this theory, to successfully carry out change, there must first be an unfreezing of the former state, transforming it to the new state and the freezing after the change to preserve it.

Status quo (present state) can be considered as the equilibrium. Unfreezing is necessary to prepare the organization for the introduction of the new state, moving away from the methods and patterns used to date. The mere introduction of changes does not guarantee its preservation, so managers should freeze new situations to fix it.

Implementing organizational changes

There are two ways to implement change: evolutionary and revolutionary (radical):

  • Evolutionary strategy is based on baby steps implementation, with the participation of employees in preparation phase (plans, design, project preparation). Making changes requires attitude of readiness to accept it, then to perform change and at the end its fixation. Speed of this process is determined by the ability and qualifications of employees. If they are too low, there is need for its gradual improvement, which may delay the process of implementing changes. Hence it turns out it is often very time consuming process. However, the big advantage of this model is very small likelihood of resistance to change. Moreover, this way of implementing change can lead to increased productivity and innovativeness of the staff.
  • Revolutionary strategy is based on top-down, sudden, unexpected and irrevocable changes performed by the management of organization, often using the services of external advisers and consultants. The element of surprise guarantees no unnecessary delays in the process of implementing the organizational change. Managers and employees will be able to function in the new organizational reliably and fast. The advantage of this model is its ability to focus on priorities and actions leading to the goal. However, in some cases, this method makes it difficult to accept the changes by employees, may imply a bad atmosphere, the occurrence of resistance or the risk of dehumanization.

Resistance to change

Resistance to change is an emotional block. This is a psychological condition that manifests itself, actions of employees that complicate or hinder the implementation of changes, as well as the delays with performing actions conducive to change, when these depend on the employees.We can talk about active resistance and passive resistance.

Resistance manifests itself in the area of ​​formal and informal structures (conflicts of interest, bureaucratic heaviness, conformity of action), in the whole social system of company, especially in mental attitudes of employees and their mutual interactions. Resistance can be shown by single employee, group or globally within company (i.e., by all employees). It may be imaginary or real, pathological or constructive. It can manifest itself, among others, in sharp criticism of superiors, the formation of resistance groups among employees, growth of employee turnover, absenteeism or decreased productivity.

The main causes of resistance include:

  • perception of lack of sense of changes,
  • uncertainty about the effects of and/or the reasons for changes,
  • fear of the loss of cherished values,
  • recognition of the weaknesses of the proposed changes,
  • feeling that changes are imposed forcefully,
  • reducing the adaptability and creativity of employees,
  • inertia of habits
  • decreased sensitivity to stimulation,
  • lack of a sense of employee self-interest,
  • Le Chatelier's principle or The Equilibrium Law,
  • ethos of the status quo,
  • cognitive dissonance.

The phenomena of resistance should not be actively fought nor underestimated because usually it can escalate. In overcoming resistance may help diagnosis method proposed by C.A. O'Connor. The author refers in it to the following criteria: public-hidden, conscious-unconscious and based on them arises

Four styles of organizational change resistance:

  • Inherent in place - unit is behaving as if nothing had changed, as if there existed no change.
  • Saboteur - unit opposes the change, however not in an open manner.
  • Zombie - this is an extreme case of unit standing in the spot.
  • Opponent - is a unit openly resisting change.

Process of adaptation to change

There are many models of describing process of adaptation to change. C. Carnall distinguishes the following steps:

  • Refusal - this is the initial situation when the employee learns of the intention to change. It then communicates the most sincere and profound conviction that it is unnecessary. Usually there occurs consolidation of the team against the change, and the quality and efficiency of work are unchanged.
  • Defence - when the individual realizes that change is inevitable and takes defensive reactions. Workers defend their positions and roles performed so far. In this phase, arise negative effects of such an attitude, that is, lowering of self-esteem and decrease of motivation at work.
  • Rejection - change of perspective, since individuals are starting to look to the future, realizing that change is necessary. Increase of self-esteem, which leads straight to the next stage: accepting change.
  • Acceptance - employees agree there is a change and its consequences. Acceptance is the higher the more individuals is involved in the preparation and implementation process.
  • Internalization - employees find themselves in a situation "after" change, with increasing motivation, and new ways of doing things become integral part of the organization.

Rules for implementing organizational change

The most important rules are:

  • Making changes is most effective if their planning takes as much time as their implementation.
  • After the announcement of the changes, employees should be provided with as much information as possible.
  • Contribution of the employees will bear fruit when they will be able to influence the way of performing their tasks.
  • Employees subject to changes, should as far as possible, plan the pace of their implementation.
  • Resistance arises because of fear of the unknown.
  • Opposition to change can also result from a lack of understanding of their goals.
  • Employees are more likely to change if they see the involvement of the top management of the organization.
  • Employees work better if they receive compensation for additional efforts.
  • Most organizations must from time to time perform changes to survive in turbulent environments.

Examples of Organizational change

  • Reorganizing the business structure: One example of organizational change is reorganizing the business structure. This could involve restructuring departments, changing job roles, or creating new job positions in order to better align the organization with its strategic objectives.
  • Technology upgrades: Another example of organizational change is upgrading the technology used by the organization. This could include hardware, software, and communication systems. These upgrades could help improve efficiency, reduce costs, and improve customer service.
  • Changing business processes: Changing the way a business operates is another example of organizational change. This could include changing the way tasks are completed, or changing the way information is shared. It could also involve introducing new processes or streamlining existing ones.
  • Adapting to new market conditions: When the external environment changes, an organization may need to adapt to stay competitive. This could involve introducing new products or services, or changing its target market. It could also involve changing the way the organization markets its products or services.

Advantages of Organizational change

Organizational change can be beneficial to an organization in many ways. Below are some of the advantages of organizational change:

  • Streamlining processes and activities: Organizational change can help streamline processes and activities, allowing organizations to become more efficient and effective in the way they operate.
  • Increased productivity: By introducing change into the organization, processes can be improved, which leads to increased productivity.
  • Improved innovation: Organizational change can help increase creativity and innovation within the organization, which can lead to more innovative products and services.
  • Improved morale: By introducing change, organizations can create a more positive work environment, which can lead to improved morale and job satisfaction.
  • Improved customer satisfaction: By introducing changes that make the customer experience better, organizations can improve customer satisfaction and build stronger relationships with them.
  • Increased growth: By introducing changes that help the organization become more competitive, it can help it increase its revenues and profits, leading to increased growth.

Limitations of Organizational change

Organizational change can be beneficial, but it can also be limiting. The following are some of the key limitations of organizational change:

  • Uncertainty: Change can bring about a sense of uncertainty which can lead to resistance from employees. This can be especially true when the changes implemented are drastic and sudden.
  • Cost: Change can be costly, both financially and in terms of time. Companies must consider the cost of implementing changes, as well as the potential for a return on investment.
  • Resistance: Employees may be resistant to changes as they may feel threatened or overwhelmed by the process. This can lead to a lack of buy-in from employees, resulting in a lack of motivation and enthusiasm towards the new changes.
  • Communication: Poor communication of the change can lead to confusion, lack of understanding and further resistance. It is important to ensure that all employees are aware of the changes and how they will be affected.
  • Adaptability: Companies must ensure they are able to adapt to the changes in order to remain competitive. Organizations must have the ability to adjust to the changing environment in order to stay ahead of the competition.

Other approaches related to Organizational change

Organizational Change is a complex process that involves multiple approaches. The following are some of the approaches related to Organizational Change:

  • Systemic Approach - This approach views the organization as a complex system composed of many elements (people, processes, structures, etc.) that interact and influence each other. This approach seeks to identify and understand the relationships between the various elements of the organization, as well as their impact on organizational performance and change.
  • Action Research Approach - This approach focuses on the implementation of changes in the organization and involves stakeholders in the process. This approach focuses on understanding how the stakeholders perceive the changes and how they can be engaged in the process.
  • Appreciative Inquiry Approach - This approach focuses on the positive aspects of the organization, such as strengths, successes, and potential opportunities. This approach helps to identify the factors that can contribute to the successful implementation of organizational change.
  • Participative Approach - This approach engages employees in the change process and encourages them to become active participants. This approach seeks to create an environment where employees are encouraged to provide feedback, suggest ideas, and actively participate in the decision-making process.

In summary, there are many approaches related to Organizational Change. These approaches seek to identify and address the various elements and complexities that are involved in the change process. Each approach has its own unique strengths and weaknesses, and organizations should carefully consider which approach is best for their particular situation.


Organizational change — recommended articles
Change management — Transformational change — Change management model — Organization life cycle — Innovativeness — Organizational behavior — Organizational innovation — Smart organization — Overcoming resistance to change

References

Author: Krzysztof Wozniak

Retrieved from "https://ceopedia.org/index.php?title=Organizational_change&oldid=94962"