3.10 Managing strategic change

Identify 3 barriers to change

• laws and legislation

• costs (budget)

• blockers (individuals who refuse)

Why is change valuable?

• necessary in order for business to adapt

• engage employees as a result of responding to their changing needs

What actions can an organisation take to improve flexibility?

• reconstructing workforce organisation

• delayering

• flexible employment contracts

What is knowledge and information management?

• information system that keeps managers informed

• monitoring internal and external trends increases adaptability

• keeps stakeholders involved so that they are aware of change

What do Kotter and Schlesinger argue are the reasons for resistnce to change?

• prefer status quo

• different assessment

• misunderstanding and fear

• parochial self interest

What is parochial self interest?

• when someone believes that change will cause them to lose power, money or status

Methods to overcoming resistance

• explicit and implied coercion

• manipulation

• education and communication

• negotiation and agreement

• participation and engagement

What is organisational culture?

• rules and standards held by individuals within an organisation

What does the culture of a business affect

• decision making

• organisational structre

• communication

• brand image

Why is organisational culture important?

• impact on staff motivation- retention, engagement

• affects decision making

• competitiveness of business

• brand image

What are the 4 culture types that Handy bases his cultural model around?

• task culture

• role culture

• power culture

• entrepreneurial culture

Task culture

• emphasis on completing tasks through cooperation and teamwork

• matrix struture delegation

Role culture

• clear rules and procedures in clear hierarchy based on individuals’ roles

• hierarchical structure

• bureaucratic leadership style

Power culture

• few people central to the organisation are given power

• autocratic leadership

• centralised decision making

Entrepreneurial culture

• risk taking and innovation are rewarded

• decentralised decision making

• democratic leadership

What is the purpose of Hofstede’s national cultures model?

• identifying cultural dimensions that affect organisational culture based on cultural differences

What is an individualist culture?

• one where each person looks to maximise their own personal self-interest

What is a collectivist culture?

• one that focuses on teamwork

Influences on organisational culture

• societal norms

• mission statement and corporate objectives

• competitiveness of environment

• personal attitudes and beliefs

Reasons for changing organisational culture

• change in owners or leaders

• change in corporate objectives

• change in size

• merger or takeovers can often mean different cultures join

• responses to market conditions

Reasons against changing organisational culture

• resistance to change

• lack of trust

• alienation of suppliers, customers and other stakeholders

How to implement strategy effectively?

• set clear standards

• manage and coordinate resources

• predetermine monitoring points and success criteria at each point

• adapt as necessary

Why are planning and monitoring crucial to successful implementation of a strategy?

• important to monitor to see if it’s working

• planning will reduce the risk of failure

• allocation of resources

• allocation of responsibilities

What are leaders responsible for when implementing strategy?

• clearly defining the strategic decision

• setting and sharing clear policies and procedures

• communicating the strategy to provide a clear vision

• overcoming resistance to change

What is the value of communication in implementing strategic change?

• strategy needs to be shared with all stakeholders

• keep trade unions informed

• reduce resistance to change

• helps everyone to understand their role

Why is organisational structure important in strategic implementation?

• span of control

• power distance index - how close you are to the person in charge

• chain of command

• decentralised or centralised decision making

What are the difficulties of strategic decision making?

• unforeseen circumstances

• changing external environment

• threat of new entrants

What is planned strategy?

• introduced with foresight

• clear sense of direction

• can be communicated easily

• success not guaranteed

What is an emergent strategy?

• greater flexibility

• developed over time

What is strategic drift?

• occurs when a strategy fails to adapt to changes in the internal and external environment making it no longer fit for purpose

What is divorce of ownership and control?

• situation that arises when one group of people own a business (i.e. managers)

What can a divorce of ownership and control lead to ?

• conflict of interest

  • managers making self-interested decisions (i.e. pay rewards at the cost of cutting profit margins)

  • short-termism vs long termism

What is corporate governance?

• formal policies and procedures that are instrumental in the running of a business