Launchpad - PGeMBA Change Management

Prof. Dr. B. K. Mukherjee

BE(Chem), DMS, Ph.D(Bus. Admin.) MIE, CE(I), LMIIChE, MIMA

Dr. B. K. Mukherjee / bkmukh48@yahoo.com

Change
The only constant feature in life is Change. Change is necessary for life; in fact, change is all around people in the seasons, in their social environment, in their biological processes, and in their work organizations. There is nothing in a caterpillar that tells you its going to be a butterfly. -- Buckminster Fuller Beginning with the first few moments of life, a person learns to meet change by being adaptive. A persons very first breath depends upon the ability to adapt from one environment to another.
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The Nature of Change

Changes have been taking place over thousands of years, but the present day changes have been more rapid, more complex, more turbulent and more unpredictable than ever before. Therefore, the question is not whether what is current will become obsolete, but how soon. The ever-accelerating rate of Change : Future Shock by Alvin Toffler (1984). Society is in a state of flux. Kenneth Boulding : concept of the 800th lifetime. Inability to cope results in dysfunctional behaviour in individuals.
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Quotable Quotes

There are only two things certain in life: Death and Taxes
-- English Humorist

However, there is a third : Change

Change alone is eternal, perpetual and immortal. -- Arthur Schopenhauer There is nothing more powerful than an idea whose time has come. -- Victor Hugo
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The 800th Lifetime

It is estimated that Modern Man is about 50,000 years old. Assuming an average lifespan of 62 years, this is his 800th lifetime. Out of these 800, Man has spent fully 650 lifetimes in the caves! (approx. 40,000 years). Written language: 6 lifetimes; The printed word (Gutenberg): 4 lifetimes; Accurate measurement of time (Pendulum): 3 lifetimes; Use of Power (Steam/Electricity): 2 lifetimes; Everything else during last lifetime.
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Causes of Change
Some of the notable changes that have been witnessed in the last decade or so may be attributed to: Globalization of Markets: Companies competing in international markets and local companies exposed to foreign competition, eg, General Motors, the worlds biggest carmaker and DaimlerChrysler, the global No.5 carmaker are jointly working on new technologies to develop hybrid cars for fuel savings and reduced emissions to combat Japanese companies like Toyota and Honda. Indian auto mfrs (Premier, HindMotor, Tata Motors) have also reacted in their own ways. Technological changes: influencing both products and processes, eg. Warehouse-sized computer of the 1940s can today be housed on a silicon chip the size of a babys fingernail. CAD, CAM, Optical fibres, etc. have revolutionised design, manufacturing, communication, and so on, eg. NOKIA, Intel. Changing Customer preferences: Less brand loyalty. More choosy, more demanding and better informed. Media explosion is driving needs and desires of customers who now have more options available before them (Shops/Stores v/s Malls).
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Causes of Change (contd.)

Political realignments: changes in political scenarios and formation of economic blocks, eg. break-up of former USSR, formation of EU and emergence of China as economic superpower. Changing Demographics: leading to a decline in work ethics, more younger people, significant socio-economic changes (nuclear, one-child families, changing sexual and family mores, greater number of women in the workforce), and so on. Organizational restructuring: more than ever before. Organizations are being downsized, resized, flattened, and so on. Alliances are being formed and mergers are on the rise. Organizations and employees are under constant pressure to master new challenges, use new tools, and keep up with changing systems and technologies. The list is endless. Change is everywhere, regardless of country, culture and corporation. It is sweeping through our lives and institutions whether we want it or not.

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What is Change?
In a very general sense, Change is defined as to make or become different, give or begin to have a different form, eg. Japan in 1945 v/s Japan today, Americans trying to learn from Japanese how to retain competitiveness in global markets. Change also means dissatisfaction with the old and belief in the new, because of perceived deficiencies in an existing system when compared with a better system. Deficiency may also be the inability of a system to respond to environmental pressures and technological impacts. Understanding Change: Past successes do not guarantee continued success. That makes it imperative for organizations (and individuals) to understand change in all its complexity, reorganize or restructure themselves periodically in tune with the changing business environment. In an organizational situation, the forces for change may come from the external environment, from within the organization, or from the individuals themselves.
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The Change process

KURT LEWINS FIELD FORCE THEORY (1951) states that organizations may be in a state of equilibrium, as a result of a dynamic balance of forces pushing for change on the one hand and forces resisting change by trying to maintain the status quo on the other. In initiating change, the tendency is to increase the driving forces, which usually also increases resistance by strengthening the resisting forces. Resisting forces

Complacency

for change

Unknown reasons

Competition

New technology

Driving forces

Dr. B. K. Mukherjee / bkmukh48@yahoo.com

New policy

benefits or power

Loss of

Fear

INTERVENTION New state1. Unfreezing 2. Changing 3. Refreezing Present state of equilibrium

The Change process (contd.)

KURT LEWINS THREE-STEP CHANGE PROCESS According to Lewin, successful change can be planned and requires a) Unfreezing the status-quo or equilibrium state in an organization by creating motivation for change. The need for change is made so obvious that individuals and teams can easily recognize and accept it. It can be achieved by increasing the driving forces, which are forces that direct behaviour away from the status quo, by decreasing the restraining forces, which are forces that resist change and push behaviour toward the status quo, or by combining the two approaches. b) The Change itself, which may occur through assimilation of new information, exposure to new concepts, or development of a different perspective, thereby leading to adoption of new values, attitudes and behaviour by the individuals or teams.. c) Refreezing: The new practices are locked into place by supporting and reinforcing mechanisms so that they become the new norm, thus preventing people from reverting back to the old status quo. Thus, Lewins three-step process treats change simply as a break in the organizations equilibrium state.
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Managing Change
To survive and eventually to prosper, an organization must monitor its external environment and align itself with changes that occur, or tend to occur. There are various ways to respond to the forces of change. One approach is simply to react to a crisis. Unfortunately, this is usually not the most effective response. Another approach is to deliberately plan for, implement and manage change. This may require new objectives or policies, organizational rearrangements, or a change in leadership style and organizational culture. Ultimately, this seems to be the core factor that separates successful organizations from unsuccessful ones. Successful organizations do not believe in change per se but in proactive (rather than reactive) change, radical when required, and reinvent themselves as and when necessary.
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Organizational Culture
Just as individuals have personalities, so do organizations. Just as tribal cultures have totems and toboos that dictate how each member will act toward fellow members and outsiders, organizations have cultures that influence employee actions toward clients, competitors, bosses, peers and subordinates. Defn:A system of shared meaning within an organization that determines, in large degree, how employees act. (Robbins and Coulter). An organizations culture conveys important perceptions, assumptions and norms governing values, activities and goals it tells employees how things are done, whats not done, and whats important. In every organization there are systems or patterns of values, symbols, rituals, myths and practices that have evolved over time. This culture the way we do things around here -- influences how employees conceptualize, define, analyse and resolve issues. Culture is something people acquire through living and from those around: one is not born with it. Individuals perceive organizational culture on the basis of what they see, hear or experience within the organization. It takes time and sometimes rather harrowing experiences, either personal or observed in the case of others, to acquire this culture.
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Organizational Culture (contd.)

THE SOURCE OF CULTURE Largely based on what has been done before and the degree of success achieved with those endeavours. The original source of culture usually reflects the vision or mission of the organizations founders and the biases on how to carry out the idea. The founders establish the early culture by projecting an image of what the organization should be. They are not constrained by previous customs or approaches. Employees learn culture through Stories, Rituals, Material symbols and Language/Jargon. HOW CULTURE AFFECTS MANAGERS Culture is of particular relevance to managers because it constrains what they can and cannot do and these constrains are rarely explicit. They are not written down and hardly ever spoken about. But they exist, eg. Look busy even if youre not. If you take risks and fail around here, youll pay dearly for it. Pedigree is more important than degree.
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Resistance to Change
The world hates change, yet it is the only thing that has brought progress
Charles F. Kettering

Individuals in the social system tend to resist many types of change because new habit patterns or sacrifices are called for. People resist change for three reasons: uncertainty, concern over personal loss and the belief that the change is not in the organizations best interest. This applies both to managers as well as other employees. Sometimes, managers are the biggest barriers to the introduction of change, largely due to a feeling of insecurity. There are two types of opposition to change: Rational opposition, based on reasonable analysis that determines costs to be greater than benefits; and Irrational opposition, based on fear, emotionalism, or selfish desires that ignores benefits to others. However, not all changes are resisted. At times the tendency is offset by peoples desire for new experiences or the accompanying rewards. Any change can either be successful or can develop into a behavioural problem, depending on how skillfully it is managed.

Dr. B. K. Mukherjee / bkmukh48@yahoo.com

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Management of Change
The managers options for change essentially fall into three categories:

Structure Departmentalization, chain of comman span of control, job redesign, delegati structural design, etc. Organisation Processes Attitudes Work methods, Perceptions, systems, expectations, equipments, etc. Behaviour, must In order to successfully manage change, managersetc. build into the organization an awareness of change, an ability to forecast change, and an attitude of welcoming change.
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Management of Change (contd.)

Some guidelines for managing change: Experience has shown that change is more acceptable when it is understood than when it is not; when it does not threaten security than when it does; when those affected have helped create it than when it has been externally imposed; when it is carried out rationally and systematically, rather than erratically or based on personal whims; when it has been planned/expected than when it is sudden/abrupt; when it follows a series of successful changes than when it follows a series of failures; when it is inaugurated after the previous change has been assimilated, than when it is inaugurated during the confusion of some other major change; to people new on the job than to people old on the job; to people who share in the benefits of change than to those who dont; if the organization has been trained to accept change.
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Business Process Re-engineering

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