Organizational Change Management Theory

Organizational remove wariness TheoryPeople and Organization Management in the Built surroundOrganizational tilt Management TheoryIntroduction-To understand veer in an establishment, it is important to study an composition and its culture. This is because, changing an organization is nonhing and changing its culture which ultimately causes variegate in performance.An Organization hind end be defined as social arrangement of consciously coordinated activities for achieving controlled performances in the pursuit of common goals. (Price and Chahal, 2006, p. 238)Organizational culture provoke be defined as characteristic, spirit and belief of an organization gener completelyy held roughly how people should be form and treat each other in an organization and attitudes to transform. (Price and Chahal, 2006, p. 238)Depending on the market requirements, an organization is setup according to- re tooth root wholeocation, business capacity, technological requirement and so for th This is why organizations harbor to constantly change to adapt to the ever-changing market while securing the organizations perspectives. Depending on the market situation, it grass be a crisis change or chosen change. Organizational change rout out be instructional (doing better than current situation), transitional ( machineation of peeled desired state) or transformational (evolutionary freshly state). (Price and Chahal, 2006) But whether it is intended or forced, the keep partnership lacks to change in order to remain competent. Change focussing champions resist the effect that change in the market has on an organization, change magnitude the importance of change counseling over the years. (Cap Gemini Ernst Young, 2004)Changing an organisational culture affects the people pertain in it in various slip commission corresponding change in work profile, learning new techniques, job cut, and so on So, it becomes necessary to manage all the people complicated, to successfully implement change while not disturbing the familiaritys goal. This makes change way a composite tabugrowth. Considering different orientations the likes of programning, stake-holder management etc. change management asshole be defined as- A continuous aggregation of dish upes, instruments and techniques, to cleanse the efficiency of the organization in problem solving and target attainment, gived by eliminating the causes of resistance to change, working in an organized and organisationatic way, from both company and employee perspectives. (Cap Gemini Ernst Young, 2004)Change operateSince the whole change process is very complex, let us consider a case-study to understand it better. We will analyze it utilise three models of change management, after which we will attempt to luck a strategical change management framework which can be used in any organization. Our case-study will also be critically analyzed against this framework.Case-studyAluminium Company of America (ALCOA) (1990) devicet at Swansea is the company under review. (Price and Chahal, 2006) cured managers of this company realized the need to review their intentiont culture and processes. They presented their case to the ALCOA board at Pittsburg, USA emphasizing on the companys present and desired state. The board was convinced(p) round the need to change. Senior managers indeed established a labourforce to take the responsibility of the change program. It had 12 members ranging from employees, employment managers, engineers, personnel, operators and craftsman. The task force drew the follo make headwayg Vision Statement-To help establish ALCOA, Swansea, as a model company by ontogeny a plant that contributes to the long- line prosperity and security of the company and its employees. (Price and Chahal, 2006, p. 245)In 1991, the taskforce drafted the intragroup document comprising of nigh important elements and strategies including vision, need to change , benefits, critical actors, resistance, etc. The plan to sweep over resistance was we must go forward and remediate or cease to do business. (Price and Chahal, 2006, p. 245)The taskforce reviewed and changed their manufacturing processes and procedures by benchmarking with other companies like ALCOA Tennessee, Cadburys etc. They notice no initial resistance while implementing new processes and procedures. But, later they noticed some symptoms like rock-bottom productivity and they observed the reasons, as employee perspectives like working practices, multi-tasking, pay, arising because of the old structure of organization having longevity and unionized systems. To overcome this, the custody appointed a new squad, which true a system by analyzing the organizations present and desired state. They changed the working doctrine of the plant workforce and the basis for remuneration. They conducted a series of workshop trainings for the holy workforce. though this entire proce ss was difficult, they observed improved performance at the start of 2000. They were very close to their targets. The new reduced workforce was super committed and motivated. But after all this success, ALCOA Swansea unexpectedly closed humble in 2003. The cured management blamed overcapacity and retard market product for sorrow. (Price and Chahal, 2006)AnalysisAlthough the senior management blamed overcapacity and slow market growth, it intelligibly indicates that they spilled to analyze the market and adjust to it by hostile marketing, necessary lay- run intos etc. To understand the reasons for the failure, we will analyze the case-study using three models viz. The Leavitts sit (1965), Weisbords cardinal-boxes (1976), McKinsey 7S Framework (1981-82).Leavitts ModelLeavitt focused on four variables in the organization, their mutualness and their influence on the change process. The variables considered ar-* Task and subtasks- Those which ar involved in achieving the ta rget.* People- Who carry out the task.* Technology- Which is adapted to achieve the task.* Structure of the organization- In term of authority, communication, workflow etc.Interlinking of the variables suggests that this is an interactive and continuous process. He did not take immaterial factors into account. (Falletta, 2005)In our case-study, the first factor to vary was Task. Change managers decided to change the companys plant culture and processes. Then they appointed a workforce, so the second variable changed was People. Then Technology and Structure changed as a result of the changed plant processes and procedures that is change in the working doctrine and remuneration. But later on, an outbreak of resistance demanded a change in the human variable as rise up as the Structure. This resulted in the groundwork of a new passing motivated workforce. This increased the companys productivity and changed the sub-task, which was to coax enough projects for the workforce to kee p them motivated and achieve the vision. But, the senior management was not a part of the task force and became an external factor leading to ignorance of vital marketing function. Considering the slow market growth, the change managers could have changed either Technology or People variable that is they could have sell some machinery or reduced the workforce to achieve the desired productivity. Ignorance of all these resulted in failure of the change process and ultimately company closure.Weisbords vi-boxesWeisbord considered six broad categories as shown above. When compared with Leavitts model, there are three different factors considered-* Relationship- The way in which people interact with each other and with the technology.* Rewards- Given to workforce for performance. * Leadership- Common leadership tasks including the equilibrium surrounded by the other factors.External environment is also considered in this model unlike Levitts model. It also tells us roughly the importa nce of input and output in relation to the external and natural environments. It does not highlight much on interconnectivity of all the internal factors (Falletta, 2005).In our case study, Relationship amidst the team was maintained well, making it highly motivated. Relationship between people and technology was also maintained which was achieved by means of training. Provision for rewards was make by changing the basis for remuneration. But, the Leadership failed. This is because of the failure to analyze the balance between external and internal inputs and outputs like reduced market growth, less productivity and profitability. This may be the result of privation of co-ordination between senior and junior management and non inclusion of senior management in the task force. When the junior managers observed lesser productivity than expected, senior managers should have made an attempt to get much jobs by aggressive marketing or should have reduced the manpower. The vision was partially achieved. Though they tried to achieve employee security by retaining them, the companys perspective of long term prosperity and security was not achieved and the process failed.McKinsey 7S FrameworkThis model was cadaverous by the employees at McKinsey, who did corresponding research in business and industry. It considers 7 variables which are-* Strategy- The plan in allocating resources to achieve the target.* Systems- Existing processes hold fasted in the organization. * Staff-Different categories of personnel.* Skills- Different capabilities.* Style- How discern managers behave to achieve the goal.* Shared value- The significant guiding concepts common among the organization.The interconnectivity between these is shown by the shape of the model. The author advises that the company cannot just change wiz or two variables to change the whole organization. In order to achieve long term benefit, variables should be changed to become more congruent as a system, sugges ting that change is a continuous process. It does not consider external environment. The concept of the performance or potency is not clear in the model. (Falletta, 2005)In our case-study, Shared values are the vision narrative as this is the common goal of all the employees. Skills were as per the requirement of the change process which was achieved through training. Production Systems were as per requirements, but Financial Systems needed more check on productivity and profitability. Staff and Style failed because of lack of coordination between senior and junior managers due to non-inclusion of the senior management in the task force, making them an external factor. As a result, they were unable to establish system to take care of shared values. Strategy failed as the company did not allocate more staff in marketing team, while production team needed lay-off. Hence, the vision was not achieved and company closed down.strategic framework of Change managementWe will draw a six f ootfall strategic framework to help implement change in any organization. We will also analyze our case study using this framework. The main distinguishing characteristic of this framework is, that it considers the detailed role of all those involved in the change management process.1. Preparing the organizationThis initiates the thought process. The first flavor is to study the organizations present state to determine its change capacity to have a realistic vision. Studying the organizations present routines gives an understanding of how the organization operates which guides about its performance in a specific routine. This will again build up the understanding of organizational operations and will guide about relevant performance. (Feldman, 2003, p. 729) Change managers then interact with different stakeholders to understand the need to change to achieve the right purpose and agree on the organizations desired state, considering internal and external drivers of change. This hel ps managers list out broad types of ethnical and technological changes required. This is then acquireed to the entire workforce along with the benefits the company and employees would get through the change. This helps win their confidence and make them feel secured and involved. Care is taken not to convey information about a specific group or singular to avoid the feeling of mistrust amongst the whole organization. (Price and Chahal, 2006)In our case study, this tint was implemented effectively. Organizational summary for present and future state was through with(p) perfectly and it was conveyed to people in such a way that everybody was convinced about the need to change.2. Developing the processVision is the guiding statement of the change process which relates the companys ultimate goal, making it the most important pure tone of the change management process. The vision and objectives should be realistic and clear. (Cap Gemini Ernst Young, 2004) Change managers first dec ide three groups viz. implementation team, range of stakeholders and workforce. Feedback from step one is analyzed and used as the basis to find out different change strategies. All these strategies are then evaluated against certain(p) questions which are * Does the option have a clear perspective and a organized approach?* Does the option support organizational or personal goals?* Were all the working environments and source perspectives considered?(Price and Chahal, 2006)Different change strategies analyzed above are again brainstormed and evaluated within the group and a final strategic process is decided which can even be the combination of some of the options evaluated. delayly a working document is drafted. Different sections in the draft include- Background, Vision, Goal, Objectives, Design, execution of instrument plan, Timescales, etc. (Price and Chahal, 2006) Implementation plan should include important aspects like cultural development, employee mobilization, knowledg e management, incentive systems, transformation map, and stakeholder management. It is observed that 10% to 30% of companies fail to plan for this. (Cap Gemini Ernst Young, 2004)Cost-benefit compend is a very important aspect of change. Every change costs something which can be categorized as economic and psychological. Economic cost is related to expenditure incurred, while psychological cost is the strain caused when people try to adjust to the change. (Newstrom and Davis, 2000) So this cost-benefit abbreviation is required to determine the worthiness of change. Only 40% of the companies think that cost-benefit analytic thinking is a must because all activities are investments that must pay off in the end. (Cap Gemini Ernst Young, 2004)In our case study, the vision statement was well written and the implementation plan was fairly drawn. But they failed to apply the Cost-benefit analysis at the right time and could not recognize that their resources were over assigned. Also, t hey failed to plan for the changing market situation, therefore could not adjust to the market growth.3. tryout supportThis is the phase before the final planning format. Once the strategic process is decided, management ensures that the team is still enthusiastic about the plan. This is the buy the farm opportunity to review all the documentation and accommodate any last minute developments before the actual implementation. This stage confirms the decision about the strategic process. (Newstrom and Davis, 2000)In our case study, this step was either not taken or not mentioned in the article. But, it ultimately did not affect the process.4. Communication boffo communication of vision and objectives at the right time, to the stakeholders and the people affected by the change is the key to success. In order to link strategic and working(a) change, it is necessary to communicate it ending on a warning. (Whipp and Pettigrew, 1992) Implementation team should identify the effect chang e has on the groups as well as on the individuals. While assigning new jobs, they should try to cooperate with the employees to the highest item possible and make them feel involved. When people think about what actions they are to take in an organizational routine, they are not confined to cerebration about performances of the routine they are enacting but may think loosely about a wide variety of organizational performances. (Feldman, 2003, p. 729)Change managers need to be proactive in reducing the amount of resistance by having the plan to overcome resistance ready. (Price and Chahal, 2006) Personal communication, conflict management, leadership development and team building are the most important aspects of effective communication. memory board management is the most overlooked aspect observed in to the highest degree 50% of the companies. (Cap Gemini Ernst Young, 2004)In our case study, communication with employees ended on a warning note as given in the plan to overcome resistance. Change was communicated successfully and the managers cooperated with the workforce resulting in successful restructuring of the organization correcting all the defects.5. ImplementationThis is a crucial phase of the process. Change managers follow the implementation plan and continue to do so till the end. If not done properly, there is a great risk of encountering resistance which can be recognized through symptoms like reduced productivity, gossips/rumors, etc. When recognized, its source needs to be identified and treated according to the plan to overcome resistance drawn at step 4. (Price and Chahal, 2006)There are some common implementation barriers observed, such as- too many activities without prioritization, no sustained monitoring of activities (observed in more than 40% of the companies). Other barriers are- constant reorganizations of the company, pitiful support from line management, inadequate readiness to take responsibility etc. (Cap Gemini Ernst Youn g, 2004)In our case study, implementation of the plan was successful in the beginning. When they observed resistance, they took necessary action against it. But it was not followed till the end. The plan was to increase the productivity. When the market slowed down, necessary action should have been taken like workforce reduction or aggressive marketing to bring fit jobs for the highly motivated workforce.6. EvaluationChange managers can evaluate the effectiveness of the process using Key Performance Indicators, at any stage of implementation. Generally, planning engineer or implementation team is not involved because of the obvious vested interests. Middle management can do it better, with unbiased views. This can be done with process inspections and audits. New processes can be reviewed and compared with the chosen process. After doing so, if any problem is identified, necessary adjustments need to be made to the process this can be repeated several times. This continues and the process becomes a driver for the next change. (Price and Chahal, 2006)In our case study, this step was almost leave out by the change managers. They either failed to analyze the less productivity resulting from the slow market growth or failed to incorporate necessary changes in the process to achieve the vision.ConclusionChange management is a very complex process because of the different factors involved in it. Though there is no globally accepted model, we can use different models in the equivalent situation. Some models are easier to use, while others need more critical analysis according to the situation. It depends on the change manager to adapt a certain process. If all the steps are followed through, keeping the vision in mind, we can successfully implement change. Otherwise it can be as black as company closure.