Unit 10, managing strategic change

What are some Internal causes of change?

• culture

• Changes in leadership,

• Business growth

• business type

What are some External causes of change?

• political change

• economic change

• social change and attitudes

• Developments in technology

• legal changes and regulations

• Changes in the competitive environment

What is Incremental change?

small changes made over a long period of time, usually with the business responding to external enviroment

What is step change

rapid change that is dramatic and requires a lot of internal changes

What is Disruptive change?

change is caused by a shift in the industry which managers do not see coming (unexpected event)

What is Lewin's force field analysis?

A theory of implementing change and why change is often difficult to implement

What are Driving forces?

things that are driving a business to change

What are some examples of driving forces

• New ideas from staff

• competitors changing

• demand from shareholders for higher dividends

What are Retraining forces?

The forces that don’t want the business to change

What are some examples of restraining forces

• expenses of change

• staff not wanting change

• disagreement of higher managers

What are the Advantages of Lewin's force field analysis?

IT is simple and shows the reasons for no change

What are the Disadvantages of Lewin's force field analysis?

may miss vital forces

what is organisational structure

the way employees are managed and organised in a business

What is the span of control referring to in the organsiational structure charts

the number of people one manager is responsable for

What does a narrow span of control mean

low no of employees per manager , meaning closer supervisions, better communications. More layers in the hierarchy

What does a wide span of control mean

More indempendance for employees, cheaper way of managing. Flatter hierarchy

What are the features of a flat hierarchy

• Less layers of staff

• less managers

• wide spans of control meaning greater delegation

What are the features of a tall hierarchy

• More layers of employees

• More staff and managers

• narrow spans of control

What is a flexible organisation?

A flexible organisation is one that can change easily and adapt to new situations.

What are the ways a business can seek to be more flexible?

• delayering

• decentralisatiton

• outsourcing

• project based teams

Why does delayering of the hierarchy make a business more flexable

less management, meaning quicker decision making in response to changes in the external enviroment

Why does decentralisation help make a business more flexable

more idea taking from employees, meaning business can quickly get an understanding of the enviroment aswell as allowing lower down employees make the smaller decisions speeding up response

Who proposed the model of resistance to change

Kotter and schlesinger

What is kotter and schlesinger process of when resistance to change occurs

When managers make a change there are four factors that may mean there is resistance

What are Kotter and Schlesinger 4 barriers to change/ reasons for resistance to change?

• parochial self interest

• low tolerance for change and inertia

• different assessment of the situation

• misinformation and misunderstanding (trust issues)

what is parochial self interest

When employees dont want change due to the unnecesary impact on themselves

What is low tolerance for change

Workers don’t feel as if they have the skills to change

What is different assesment of the situation to do with resistancy to change

Employees do not agree with the managers assesment and why they need to change

What is misinformation/misunderstanding (trust issue)

Don’t believe what managers tell them and feel that they are given a lack of neccesary information

What are some Reasons employees resist change?

• habit

• economic reasons

• fear of the unknown-

What are some Organisational barriers to change?

• existing power structures,

• resistance from work groups,

• failure of previous changes

What are some Reasons why change fails?

• lack of planning,

• insufficient training,

• resources,

• whatinadequate reward

What are the 6 ways Kotter and Shleinger stated could be used to overcome resistancy

• Education and communication

• participation and involvement

• support

• negotiation and agreement

• manipulation

• coercion

Why does education and communication help overcome resistancy, and who is it usually used on

Employees are explained to, and shown the LT startegy and goals. This helps employees not feel as uncertain

Why does participation and involvement help overcome resistancy, and who is it usually used on

involves shareholders in the change and motivates employees to become involved with the excitement of change

Why does facilitation and support help overcome resistancy, and who is it usually used on

It supports employees who fear their lack of skills, and ensures better training, counselling ect so they are less worried they will fail to keep up

Why does negotiation and agreement help overcome resistancy, and who is it usually used on

Uses bargains and negotiation to win agreements, used on important stakeholders, senior managers, and trade unions

Why does Manipulation help overcome resistancy, and who is it usually used on

Selectively sharing info to key members, aswell as giving them more decision making power = them being more likely to feel important and help change

Why does Coercion help overcome resistancy, and who is it usually used on

using authority, and strict threats to ensure change ie, employees who resist will be made redundant. This can occur when resitance is strong and time period is short

What is Knowledge management?

the process of capturing, developing, sharing and effectively using organisational knowledge

What is Organisational culture?

behaviour of people within an organisation that eventually leads too it becoming the norm in the business

Where does organisational culture usually come from

• behaviour of leaders,

• shared beliefs,

• ways of working,

• behaviour of individuals or groups

What is a strong organisational culture?

A strong organisational culture is when employees agree with the corporate values of the business.

What is a weak organisational culture?

In a weak organisational culture employees don't share the company's goals and usually have to be forced to do what the company wants them to do.

What are Handy's 4 categories of organisational culture?

• power culture,

• role culture,

• Person culture

• task culture

Explain power culture (Handy)?

Limited to the interests of the Main stakeholders, centralised decision making, all employees look up to top management for guidance

Explain role culture (Handy)?

beurocratic ,with a rigid hierarchy that determines power and role in the company, the higher on the hierarchy, the more power and decision making you have

Explain task culture (Handy)?

uses a matrix structure where employees are more split into groups where they can share knowledge. Those with better knowledge are heard and have more power

Explain person culture (Handy)?

Individiuals are more important than the organisation itself , individuals make decisions themselves and don’t neccesarily need to report back to organisation

Business example of power culture

Steve jobs in apple, main decision maker, looked up to

Business example of Role culture

The NHS, follow a clear hierarchy with clear job descriptions.

Business example of Task culture

NASA uses project teams in order to share knowledge more effectively

Business example of person culture

Law firms, usually the lawyers themselves are more important and make individual decisions over the entire firm.

What are the advantages of power culture (handy)?

- Few rules and procedures needed, managers set the pace and direction

- Swift decision making possible

What are the disadvantages of power culture (handy)?

- Large organisations struggle to be run in this way

- One person having total authority is not always good for decision making!

What are the advantages of role culture (handy)?

- Set procedures, maximises efficiency and accountability

- Can train individuals for role

What are the disadvantages of role culture (handy)?

- Tall hierarchy, resistant to change

- Less scope for experts to make improvements

What are the advantages of person culture (handy)?

- Can be nimble and open to change

- Benefits from expertise of staff

What are the disadvantages of person culture (handy)?

- Can be hard to establish authority to make decisions

- People can believe themselves superior to the business

What are the advantages of task culture (handy)?

- High levels of engagement and enthusiasm

- Values expertise of team

What are the disadvantages of task culture (handy)?

- Teams may develop own goals separate from the company

START HERE AGAIN

What are some Reasons for changing culture?

declining profits,

inadequate returns on investments,

low customer service standards

Growth - as they get bigger, there will be more challenges, This can necessitate a culture change.

International expansion

Change in leadership

Problems with changing culture

overuse of power tools, vision but not tools, beginning with power tools

What is Strategic implementation?

the process of allocating resources to support the chosen strategies

Functional structure

consists of activities like coordination, supervision and task allocation

What are the 4 types of organisational structure?

- functional structures

- product-based structures

- Regional structures

- matrix structures

What is a functional structure?

Organised into departments with their own functions, e.g. HR, finance, marketing, operations.

What is a Product-based structure?

Each product or product line operates almost like a separate business with their own marketing, finance, etc.

What is a Regional structure?

Based on geographical location, each area will have its own functional departments under a regional or national manager.

What is a Matrix structure?

Teams are organised based on two different criteria. For example, an accountant may report to a financial director, but be assigned to a particular project with its own manager.

What is Network analysis?

project management tool to aid the implementation of a strategic plan

Designed to support managers in finding the most efficient and cost-effective way to complete a complex project.

How to use network analysis?

- identify all the tasks that need to be done

- and assign them letters

- need to identify the dependencies between them (before starting on one task what needs to be done before).

- set the tasks out in a visual network with one task leading to another. Tasks are represented by arrows, the points where tasks begin and end are called node.

- need to work out how long each task is expected to take.

- nodes are sometimes assigned numbers as well, if so the number of the node is usually on the left.

-in the upper right of each node put the driest time that this node can be reached and the next task can begin assuming nothing gets delayed (do this from left to right).

-when two tasks lead to the same node its the latest time that goes into the node.

-in the lower right of each node put the latest time that we can reach that node without delaying the completion of the project (do this from right to left)

-tasks not on critical path can be delayed up to last finishing time 'float' time

How to calculate float time?

Float = last finishing time (LFT) - duration - earliest finishing time (EST)

What is the critical path in network analysis? And how to spot it?

The critical path is the path to the end point through the network that takes the most time to complete.

It's easy to spot because this is the path where the earliest finishing time (EFT) always equals the latest finishing time (LFT).

What is a Planned strategy?

A planned strategy is one where strategy is decided in advance. It is deliberately adopted as a result of decisions made by leadership.

What is an Emergent strategy?

An emergent strategy is one that evolves over time as a business learns what it is good at and establishes patterns of behaviour through the choices it makes.

What are the strengths of planned strategies?

- Clearly stated objectives to work towards.

- (Hopefully) carefully researched and based on known data about the market.

What are the weaknesses of planned strategies?

- Can cost a lot of time and money.

- Planned strategies can become out of date as the market changes.

What are the strengths of emergent strategies?

- Can adapt to the changing environment more easily.

- Relies on the knowledge and experience of middle and junior managers with more access to market information.

What are the weaknesses of emergent strategies?

- May not have a clearly stated goal to work towards.

- When strategy changes constantly, senior managers may be unaware of what direction the business is taking.

What is strategic drift?

Strategic Drift is the name for when the strategy chosen by a business and the reality of the market grow apart.

Porter strategic plan

company strengths and weaknesses, personal values of the management, industry opportunities and threats, bread societal expectations

What is Contingency planning?

A contingency is a plan that you have for when something goes wrong. It's a backup plan for when your main plan doesn't work.

What are Kotter and Schlesinger approaches to overcome resistance?

- education = communicate honestly about what is happening and why it needs to happen.

- participation = encourage resistant individuals to get involved with the process of change to bring them on-board.

- facilitation = providing support, counselling and training to adjust to changing circumstances.

- negotiation = understand what people want and give them incentives to accept change (or leave).

- manipulation = be selective about the information you give to people about how change is to occur.

- coercion = impose negative consequences for resisting change and communicate these to employees.