Change Management

Change management process. Implementing a change within an organization can be a very challenging process even for top management. In order for the change to be successful it might need the cooperation of tens even hundreds of managers . The resistance to change can be considerable while the manager Is trying to finalize the change the company will continue serving It’s clients. Sometimes the resistance to change can be so strong that the Initiator of the change Is obliged to leave the company.

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In 2000-2001 , the CEO of Ford, Jacques Masses tried to impose some changes that would transform Ford n ” One of the best managed companies in the world”. He tried to change the way the company was manufacturing and selling its cars along with how it dealt with its employees. As a CEO he had massive influence over his pears, but then again not enough to win over the resistance to change coming from the managers, employees and dealers. He was forced to leave the company In less than a year.

Not all organizational changes are as complex as the one presented above, sometimes it’s enough Just to mediate the problems that arise between departments, improve the IT equipment and motivate your employees to embrace risk. Even if we are dealing with a simple or complex change that we are looking to implement, the structure of the process stays the same, and usually the change agent is faced with the following 3 questions: 1. What are to forces that work against me?

In other words, what should I take Into account when deciding to Initiate the change and how I should approach It. For example: Which are the external forces that demand the chance? – maybe some new players on the market or a deferent type of product that threatens our market share and how fast should we react to these elements. 2. What should we change? Should we conduct changes that are strategically planned and its effects to be reflected throughout the entire company or do we need to have a limited affected area?

Sometimes the company needs a radical change! In the case of Ionians It meant the modification of the inure firms strategy ( what do we do and how do we react to our competitors) along with technological ( changing the technologies used in the production process ) & human resources changes ( know how, qualifications and other skills ). It is true that in many cases the change can be also focused on specific areas. For example maybe a certain department needs to be reorganized or restructured. 3. How should we Implement the change?

The mall focus of the manager Is that the change Is beneficial and successfully Implemented while being perceived as an opportunity. That’s why getting over the resistance to change can be done through two methods: Should I force the decision or get the employees involved in it? And if they get involved to what extent? The basic method involves what the psychologist Kurt Lenin named: ” Melt, move, freeze again “. This undervalues the importance that the employees should perceive change as a challenge.

Before we conclude how a change should be Implemented let us take a look at how managers Deciding Change The change that will be implemented usually targets one of the main core elements of a company: Strategy, Technology, Structure and The Human Element ( Their behavior, culture, qualifications etc ). We will conclude a detailed analysis of each one. Rarely in real life we will encounter changes on only one of these areas because they are strongly interconnected. Changes in Strategy Changing a company’s core strategy represents a very complex challenge throughout the entire organization.

For example, faced with a decrease in profits, Eaten Insurance recently quit its strategy of accelerated growth. The company used to focus on increasing the number of clients, now, it is looking at gaining fewer contracts but more profitable. The number of employees dropped from 22 million down to 14. 4. Focusing on the quality of the contracts Eaten managed to increase its profits by a factor of 10 reaching – $108 million on one of its last trimesters. Even if sometimes the company needs to implement these changes for the purpose of survival, the changes in strategy are one of the riskiest.

This is mainly true when the company is faced with what the researchers call intermittent changes. These imply unforeseen changes that tend to generate crisis, much like when the digital technology took over the old fashioned style. These type of changes have ripple effects throughout the entire company, most often demanding changes in structure, technology and also in personnel training. They usually result out of short-term pressures and unforeseen external changes such as the rapid growth of competitors or innovations in technology ( Internet ).

Managers striving towards this type of changes need to take onto account the results of research done in this domain: 1 . Changes in Strategy are usually the result of external factors. External challenges or threats, such as decentralization, growth of global competition and technological innovations usually push the company towards these type of changes that are felt through the entire organization. 2. Changes in strategy are mostly demanded in order for the company to survive.

While changing the strategy does not guarantee success, research shows that company that fail to implement them end up not surviving at all. 3. Changes in treated implemented in times of crisis are very risky and they affect everybody in the company. Changes in Technology Changes in Technology refer to changes in the way a company is manufacturing/ creating and selling its products or services. For example: the manager might wish to modernize the production like through 1 . Installing or upgrading the computerized systems, 2. Modification on how a company’s employees interact with their physical environment 3.

Upgrade to how employee friendly is the technological interface. Changes in Structure: How to implement the reorganization process. Changes in structure refer to modifications of one or more aspects within the organizational structural elements. They can change the structure directly through: replacement, firing, hiring or they can change the infrastructure trough changing the company’s policies, procedures and rules ( such as the performance evaluation metrics ) Mostly these type of changes are the ones that bring out the resistance to change.

After the changes are implemented the employees are left with new authorities to which they will have to report to, that is why most see change as a step back because they already have certain relationships and trust levels with the previous management. In addition to that this type of change could mean new tasks and most employees are pleased sticking to their comfort zone, from which it’s easy to predict the outcome of the generated work. Now-a-days entire environments are changing rapidly which leaves the managers with two questions: 1.

Towed need a new structure? An internal problem doesn’t necessarily translate to a change in structure, sometimes it can be fixed with little adjustments specific to the said problem. 2. What should this structure look like? When a problem is identified it is recommended that the solution would not be the radical change of the structure, only after everything else was tried and failed then we can look towards fundamental changes. ; Steps towards problem solving without implying major changes: 1.

Changes that do not need structure modifications: Improved task-attribution process Perfecting the reporting processes Improving the relationships between other processes 2. Redefinition of competences and of the bonus system Modifications on the criteria on which personnel is selected – abilities should be developed Identifying what motivates people. 3. Improving the Management Context Clearly defining what is the appropriate management style. – norms, values and social context. Steps towards problem solving that imply radical changes. 1 . On organizational level: Changes in the scale and size of the organization.

Redefining which Clearly defining the Substantial changes Changes in the function of structural units ( example: the transformation of functional units in service or business related)- Creating new units or the fusion between existing ones. 2. Structural changes: Creating new divisions. Changing the command centers. Changes on the human element The changes in strategy, structure or technology generate changes within the attitudes, values and aptitudes of the employees. Sometimes employees simply do now have the know-how necessary to fulfill certain tasks.

This is where the management start focusing on the training and qualification of the personnel. Other times the problems arise from misunderstandings or conflict. In these cases the manager might want to change the organizational culture – the core values and how these are reflected in each employee’s behavior. For example the poor performance of Motorola (prior to the acquisition by Google), research shows that was mostly the result the company culture which revolved around too much bureaucracy and the time from creative to implementation was to lengthy.

Another influencing factor was the internal competition that was too fierce to the point to which it stopped innovation. Implementing Change After deciding what to change the manager is left to decide how the change will be implemented. The manager’s focus is that the change is perceived as an opportunity and it is beneficial to the entire organization. The main challenge that arise is how will he manage the resistance to change and how to minimize it. Why do people oppose change? Overcoming the resistance to change is usually the most difficult part of the change process.

Nicolle Machiavelli, as an observer of Italian politics environment of the WI-the century said: “It must be remembered that there is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage than a new system. For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain y the new ones. “. The fact that a change is recommended or even mandatory doesn’t mean that the people will accept and stand by it.

In some cases even key people within the company can oppose the change due to the fact that they prefer the existing situation. A few years ago Paul Lawrence stated that people do not oppose technological changes but the social outcomes generated by them. Employees see in each change a diminution of their responsibilities and with that a decrease in their work status and also in their Job security. It’s not the threat of Lear consequences of the change but the uncertainty of what is yet to come that starter the resistance to change.

Sources of resistance Resistance has many sources, in his book “Beyond the Wall of Resistance” consultant Rick Manure says that resistance can be generate by two main sources. He talks about two levels of resistance: 1 . Resistance Level 1 – comes from the lack of information or the credibility of it. 2. Resistance Level 2 – it’s more personal and depends of the emotional situation in a certain case. In this case people are afraid that the change will lead to them losing the Job. Manure says that treating each resistance as it is of level one will undermine the efforts in place by the manager.

Some people are more resistant to change than others – there are usually the ones that always seem to fight back the system, those that usually do not tend to look for improvements within the organization. A study analyzed six different organizations: two companies from Europe, two Australian Banks, a university in the USA and a production company in South Korea. The aim of this study was to determine in which way personal traits of managers influence their attitude towards change. Three key personality traits lead to an significant increase in the efficiency with which the change was implemented.

These traits are: tolerance towards ambiguity, good impression about themselves as individuals and higher risk tolerance. Overcoming resistance to change The psychologist Kurt Lenin proposed the famous model to outline the basic process within an organization is the by-product of two types of forces: one looking forward to the change and the other force that wanted to maintain the current situation. Implementing the change means diminishing the forces that work towards maintaining the current situation or the creation of new forces that work towards the change being successful.

Unfreeze – means the reduction of forces that wish to keep the situation as it is . The goal is to make the employees admit that the change is necessary so they can start looking for new solutions. Surveys, interviews or large meetings usually can cause this. Some managers generate this by creating a crisis – such as suggesting the bankruptcy of the company if things don’t change fast. Once the manager has their attention, the employees should be pointed in the right direction. Linen’s second step – Change: refers to the changes in employee behavior throughout the company.

Change means the development of new behavior types, values and attitudes through the application of certain techniques. Any manager that went to a change knows that implementing the change is not enough. People tend to go back to their old habits if the management doesn’t keep the change alive. If the change is not sustainable there is the risk that the change will not be permanent. This is what the process of Refreezing is all about. In table 1 there are presented a few of the methods managers use to overcome the resistance to change ND when to use them.

For example: Education & Communication is used when information is misleading or the lack of information leads to resistance to change. At the other end of the spectrum Constraints – forcing the change – may seem as a viable way to pressure the organization into change in a fast manner at moments when time is critical. This might work when the managers has enough authority and power to force the change. This can backfire if the employees or the rest of the management counter-powers the authority and undercuts the change. Table 1 . Six methods to overcome resistance to change

Method Where/When Advantages Disadvantages Education & Communication When there is a lack of information or the existing information is misleading. Once convinced people tend to help with the implementation and development of the change process. The process can take a long period of time if there is involved a large number of people. Participation & Involvement When the initiators lack certain information needed to implement the change and when faced with a strong resistance to change. People that take part will get involved into he change process and any valuable information they might have ill be integrated in the plan.

It can take a very long time if the projected change is not suitable to the ongoing scenario. Gratitude & Support When people oppose change Just out of fear and anxiety. There is no better way to solve the problems employees face. Takes long periods of time, is very costly and it might fail. Negotiation & Agreement When a person or a group will perceive a loss due to the change and when that group has a strong resistance towards it. Sometimes this is one of the easiest ways to undercut strong resistance. Can be very costly in many asses if others get entitled to negotiate.