Week 13: Organizational Change

All of the following are descriptors are things that are good about change: 

• Learning experience 

• More opportunity for growth 

• Makes you revise/make a change 

• Fosters creativity 

• Stimulates new thinking 

• Squashes the status quo 

• Pushed me to grow 

• Kept me from becoming redundant 

• Kept me from failing when others made the required changes 

Voluntary change

• (Harder than involuntary)

• You make the change yourself. 

  • Leave the job yourself that has been causing you more stress. 

Why is voluntary change the hardest?

• Fear of the unknown 

• Stay in stuff that’s bad for us. 

• Escalation of commitment and sunk cost 

  • I've been at this job for 4 years, so I might as well stay. 

When does the human voluntarily change?

 When the pain of the present is greater than the pain of the unknown 

Involuntary change

Change that happens to you 

• You get fired from your job 

Why do organizations change?

External sources and Internal sources

Why do organizations change? - External Sources

Anything that brings change in structure and strategy

Examples:

• Global competition

• Deregulation

• Advanced technologies

Why do organizations change? - Internal sources

Also, anything that brings change in structure and strategy

Examples

• Lower productivity

• Internal conflict
  Strikes

• High absenteeism

• Turnover

The Perfect Storm (“S)

• Strategic change responses

• Structural change responses

Examples of strategic and structural change responses

• Buyouts

• Downsizing or expansion

• Restructuring

• Redesigning jobs

• System upgrade / replacement

What organizations can change

• Goals and strategies

• Technology

• Job Design

• Structure

• Process

• Culture

• People

What organizations can change: Goals and Strategies

Aiming to become the leader in the industry 

What organizations can change: Technology

Because of those pressures, we're going to move from a rigid line to a more stable one 

What organizations can change: Job Design

• Job characteristics model  

• 5 core job characteristics 

• Breadth and depth being paired with a person’s GNS 

What organizations can change: Structure

• Changing our span 

• Decreasing the links in the hierarchy  

What organizations can change: Process

How we do things

What organizations can change: Culture

• Shifting beliefs and values  

• What we're rewarded for 

• Changing orientation programs 

What organizations can change: People

Recruiting and selection systems

What Organizations Can Change

• Change in one area very often calls for changes in other areas. 

• Changes in most areas require serious attention to be given to people. 

• Change requires employees to learn new skills and change their attitudes

Change in one area very often calls for changes in other areas 

• The trickle effect/chaos effect 

  • If you change one thing, it will change 10 other things 

Change in most areas requires serious attention to be given to people 

• Often resist change 

• Are people on board? 

• Change resistance is very common. 

• People with you, people on the fence and people against you

Change requires employees to learn new skills and change their attitudes 

• Always requires new KSA's  

• My attitude has to change 

• My t in S+T=R has to shift 

Definition of Change?

It’s a disruption in expectations 

• Cognitive dissonance 

• Something that you weren't expecting 

  • Even if you're starting the change, there's still a change you didn’t expect 

• It's about what's going on in a person's head 

Change versus Transition

Change 

• Hard messaging 

  • “You're fired!”

• External and based on the organziation

• The change is done 

 

Transition 

• Soft messaging  

• Internal and Individual

  • Deadliness of what happens in peoples heads 

Psychological Dyamics of Change (How we change)

• Sense of Loss

• Lack of clarity

• Self Preservation

• Persona (in the guy then to head)

• Loss in performance

Psychological Dynamics of Change: Sense of loss

• People feel like they're losing something.

  • Doesn’t matter if it’s voluntary or involuntary. 

Psychological Dynamics of Change: Lack of clarity

Confusion of why this is happening and what my future will look like 

Psychological Dynamics of Change: Self-preservation

The WIFM effect 

• What's in it for me = wifm (protection) 

• Humans try to protect themselves. 

  • How will I get through this myself? 

Psychological Dynamics of Change: Personal

Gut = resistance

Psychological Dynamics of Change: Loss in performance

J curve 

• A fall and then a rise 

• A loss and then you pick yourself up  

• Question is: how fast is the rise? 

Kurt Lewin’s Stages of Transition model

When a human is presented with change, either voluntary or involuntary, they undergo 3 stages:

Unfreeze —> Change ——> Refreeze

Kurt Lewin’s model - Unfreeze

• Recognizing that we can no longer be the way we have been in the past

• Something is right and we need to begin the process of pulling it out

How do we get ahead of the unfreezing stage?

Take a more anticipatory strategy (being ready for that change), for example: 

• Scanning and forecasting 

• Reaching out to customers and getting their opinions on how the organization is doing

• Accounting data (anticipate problems) 

Kurt Lewin’s model - Change

• Moving an organization (or its members) to a more satisfactory state

• Change efforts range from minor or major

Kurt Lewin’s model - Refreeze

When the organization (or human) doesn’t go backwards and use the old behaviour, take on the original attitude or return to the old way of doing their job

• In your new normal (you're not going back) 

What issues must the change process overcome to be effective? 

We need to overcome diagnosis, resistance, evaluation and institutionalization issues to successfully move from unfreezing to changing to refreezing 

Diagnosis

• Collecting information on the problem that is causing the need for unfreezing 

• Use change agents

What is a change agent?

Diagnose and make recommendations for changes to organizations by applying behavioural science knowledge

Resistance

Pattern of thirds 

• Always going to have a third with you, a third on the fence and a third who don't agree with you 

• Overt or covert  

  • There could be failure = resistance 

Evaluation and institutionalization

• Did the change accomplish what was intended? 

  • Ie did we get people to learn what they needed to learn? 

• Refreezing (new normal) 

Causes of Resistance

• Politics and self interest 

• Low individual tolerance for change 

• Lack of trust 

• Different assessment of the situation 

• Strong emotions 

• Strong organizational identification 

• A resistant organizational culture 

Politics and self interest

People think they will lose power or status if they go through change 

Low individual tolerance for change

• Some people are just more uncomfortable with change compared to others 

  • High vs low levels of tolerance for change (or ambiguity) 

Lack of trust

I agree with why the change needs to happen, I just don't trust the motives behind it  

Different assessment of the situation

• The targets of change might believe that the situation does not warrant the proposed change  

  • Think that people leading the change are misreading the situation 

Strong emotions

• Can educe a feeling of helplessness and anxiety and ultimate resistance 

  • Emotional stability 

  • Mood and emotions can make resistance a bigger deal 

Strong organizational identification

• People who identify strongly with an organization often resist organizational change

  • Escalation of commitment theory

A resistance organizational culture

A culture that has been rewarded for stability and tradition is all of a sudden making a change

Pattern of Thirds

People typically split into thirds, supporters, opponents, and undecided, so efforts should target the undecided group for the greatest impa

Considerable difference in how people react to change over time

• Champions

• Doubters

• Converts

• Defectors

Champions

Welcome change from the beginning and maintain change-supportive perceptions over time

Doubters

• Resist change from the get-go and persist in their resistance

  • Goes from beginning to end 

Converts

• Resistant at first, but come to see the value of change

  • Pattern of thirds: The 1/3 who are sitting on the fence and eventually join the champions  

Defectors

• Have initial change-supportive perceptions but become resistant over time

  • Pattern of thirds: The 1/3 of people who are against you  

Organizational Development (OD)

• Planned, ongoing effort to change organizations to be more effective and more human

  • Knowledge of behavioral science is utilized to foster a culture of organizational self-examination.

  • Focused on interpersonal and group processes

The 4 classic organizational development interventions

• Team building

• Survey feedback

• Total quality management (TQM)

• Reengineering

OD - Team building

• OD emphasis is on paying attention to rules, interpersonal conflicts, and how we build cohesion in teams. How do we foster diversity? 

• Making sure that teams are forming, storming, norming, performing and adjourning well 

OD - Survey Feedback

• Collecting data through questionnaires and interviews 

• Understanding issues that exist both inside and outside the organization 

• Making decisions on how to improve based on data (data analytics) 

OD - Total quality management (TQM)

Continuous OD effort that focuses on the quality of organizations’ products and services 

OD - Reengineering

• Redesign of organizational processes 

  • Activities or work, enterprise resource planning systems (ERP) 

• Achieve major improvement in time, cost, quality and service 

Does Org Development Work?

Yes 100%! OD Development does work  

Why does Org Development Work?

Positive impact on:

• productivity

• job satisfaction

• Works better for supervisors and managers

• Changes that use more than one technique seem to have more impact

The Innovation Process

Innovation is another roundabout way of making change in an organization.

What is innovation?

The process of developing and implementing new ideas in an organization

Innovation requires:

• Creative ideas and creative people

• People who will fight for new ideas

• Good communication

• Proper application of resources and rewards

What is creativity?

The production of novel but potentiall useful ideas

Idea Champions

• People who see the kernel for an innovative idea and help guide it through to implementation

• This role is often informal

• Involves sponsorship and support

The Knowing-Doing Gap

• Many managers know what to do, but have considerable trouble implementing this knowledge in the form of action

  • Exhibit inertia

Why does the knowing-doing gap happen?

1. A lack of skill

2. Fear

3. A lack of trust for the reasons for change

What are the three lessons from the knowing-doing gap?

• Tendency to reward people with short-term talk rather than longer-term action

• Change requires cooperation and integration.

• (Most important!): Managers do not understand the purpose of the change.

  • "They can’t see the forest through the trees."

Sample Question: We discussed how people go through change and what they experience; all of the following are dynamics of change except... 

A. Loss and performance (J-curve) 

B. Risk seeking 

C. Self-preservation (WFIM) 

D. Lack of clarity 

E. Sense of loss