About 70% of all change initiatives fail.

Each business change is unique but each

change is a variant of one of the two
archetypes.
The two theories are :
Theory E
Theory O

Hard approach to change.

Based on the economic value.
Prime importance to the shareholders value.
Change involves:
Economic incentives
Drastic layoffs
Downsizing
Restructuring
Commonly followed in the US economy.

Soft approach to change.

Develop organizational culture and human
capability through individual and organizational
learning.
Process of:
Changing
Obtaining feedback
Reflecting
Making further changes
Companies that enact this strategy have a strong,
long-held, commitment-based psychological
contract with their employees.
Adopted by corporate houses in Asian and
European economies.

A company should implement both Theory E

and Theory O simultaneously.
The company should be lead by a leader at
the top who clearly sets and organizes
company changes.
At the same time, this leader should listen
and look for input from the lower levels of
the company.

Simultaneous focus on hard (corporate

structure and systems) and soft (dynamic
of the corporate workplace and its culture)
changes.
Reaps payoffs in profitability and
productivity.
Goal should be to make the company a
financially sound and a great place to work.