1. Why do organizations change?
2. Does my organization need to change?
3. What happens if we don’t?
A company also need to be answer,
4. How important is IT to the success of our industry / organization?
5.What kind of change will it introduce into the organization?
Looking from the IT perspective, one should try to answer the following questions:
6. Are IT resources appropriately placed in the firm?
7. Are leaders capable and ready to deal with the change management challenges?
The reasons for change can be either through Internal Factors or External Factors. IT influence in large organization is pervasive, affecting the smallest department and decision-making processes to an extent not visualized few years ago.
Dynamics of Change:
The general market structure and industry dynamics and the way they work are listed below:
The old industry value chain is:
b) Functionally organized and transitional in nature
c) Vertical organization structures within organization boundaries
The new industry value chain is:
a) Process based
b) Integrating the enterprise activities
c) Boundaries are becoming fluid
d) Partnership and the rise of virtually integrated industry
Strategic impacts of existing IT system are based on the strategic relevance and impact on the following 4 categories. The goals and who has to exercise them were also listed below for all the four categories.
1. Factory: IT is important but they are not fundamental to the firm’s ability to compete
Goal: Improve performance of core processes
Leadership: Business unit executives
2. Strategic: Totally depending on it
Goal: Transform the organization or industry
Leadership: Senior executives or board
3. Support: Strategic Impact of IT on operations and future strategy is low.
Goal: Improve local performance
Leadership: Local level oversight
4. Turn Around: Not absolutely depending on totally uninterrupted, fast response-time.
Goal: Identify and launch new ventures
Leadership: Venture incubation unit
The various questions that arise here are, Do the perspective and skill of the IT team, IT users, and general management team fit the firm’s changing strategy and organization and the IT application, operating environment, and management processes?
Is the firm organized to identify, evaluate, and assimilate new information technologies on a timely basis?
Are the strategic planning, the management control and the project management systems defined and appropriately implemented and managed?
Are appropriate organizational structures and coordinating mechanisms in place to ensure IT is appropriately aligned to the needs of the firm? What is the importance of change management in the organization?
The Two Perspectives of Change: Organizational and Individual.
Questions at Organizational Level:
What is the required investment?
How will this change impact our financial performance?
What is the return of the investment?
When can the change be completed?
How much improvement will be realized?
How will this change impact our customers?
Questions that arise at Individual Level:
What will this change mean to me?
Will I have a job?
Do I have the needed skills and knowledge to succeed in the new environment?
Incremental Vs Radical Change:
Type and size of change determine the level of change management levels
a) Order of magnitude of change
b) Incremental needs less
c) While Radical needs more
Tactics for Managing Radical Change: The pace of change depends on the process that is,
1) Tactics, or techniques used to encourage an organization’s member to accept change
2) Complies with current organizational values and norms, skills, structures and incentive is evolutionary
3) Change that challenges or undermines the status quo, creates a new vision, and accomplishes fundamental change is revolutionary
Change Process: Various stages at Organizational and Individual Level.
Change is a Process:
1. It Takes time
2. Stages Involved in this process: Individual Level, Organizational Level.
Ideally both are going their stages at similar speeds.
Various Organizational stages are:
a) Business Need,
b) Concept and Design,
Various Individual stages are
a) Awareness: of need for change — reasons, and degree of comprehension
b) Design: to participate and support — motivating factors and consequences and level
c) Knowledgement: about how to change — skills and insights
d) Ability: to implement new skills and behaviors — evaluate level and determine shortcomings
e) Re-enforcement: to keep the change in place — incentives and constraints to make it stick
Organizational Change Management Phases
Phase 1: Preparing for change
Define your change management strategy based on scope, risk, readiness, resources, and sponsorship
Prepare your change management team (selected and trained)
Prepare your sponsorship model
Phase 2: Managing a change
Develop change management plans
Take action and implement plans, communication plans, coaching plans, training plans, sponsor roadmaps,
Resistance management plans
Phase 3: Collect and analyze feedback
Diagnose gaps and manage resistance
Implement corrective actions and celebrate successes
Integrating Change Management with Process Improvement.
Business Improvement Process Steps
1 = Problem or opportunity identification
2 = Project planning and team formation
3 = Data gathering and business solution design
4 = Process and system development
5 = Implementation and measurement
Change management component
Organizational and change assessments
Team readiness and sponsor preparation
Awareness building, communications and training
Coaching, feedback and employee involvement
Change Management strategies to Improve Strategy Execution: Change Capacity, Change Absorption Paradigm and Absorption Threshold.
Change Management to Improve Strategy Execution:
1. How will enterprises develop an understanding of their current capacity for change?
2. How will enterprises accurately assess the scope and impact of a change initiative?
3. How will enterprises increase their capacity for change?
4. How will enterprises ration, orchestrate and manage change to improve strategy execution?
Change capacity: is defined by Employee willingness and ability to change.
It is affected by Organizational history and culture, leadership credibility, attitudes and trust toward management, perceptions of urgency, employee skills, and a collective experience of change.
Steps Involved to increase the Change Capacity:
Understanding the enterprise’s current change capacity is the first step
Change Absorption Paradigm: change can be characterized by three variables such as volume, velocity and complexity. Where,
Volume in the above framework indicates the number of change initiatives underway within an organizational unit at given point of time. Velocity is the speed at which the change management initiatives are introduced into the organization. Complexity is the measure of the reach, range and duration of the change initiatives
The Absorption threshold of the change for a given organization can be increased by
Increasing the flexibility in the organization,
Lowering the levels of hierarchy,
Increasing accountability and responsibility
Methodologies to Improve Strategy Execution: Change is a process and as a process it can be managed using:
4. Best practices and methodologies
Dimensions of Change Stemming from Re-Engineering: Structural, Management and People’s Dimensions:
Dimension of Change Stemming from Reengineering:
Industrial Age Organization: Network Age Organization
Hierarchical org. based on Networked Org. based
Function / product. Cross-functional teams
Rigid Bureaucracy Flexible Adhocracy
Org. Integration through- Org. integrate through-
-Structure – information systems
Management by- Management by internal-
-Internal objective -and external objectives
Structural empowerment Informational empowerment
Fragmented Tasks performed Holistic Process
By individuals accomplished by teams
Functional specialists Case management and process generalists
Expertise as functional- Knowledge as- -Specialist – organizational resource
Resistance: What is Resistance, Levels of Resistance: Examples
What is Resistance?
Resistance is any force that slows or stops movement. It is not a negative force nor are their “resistors” out there just waiting to ruin our otherwise perfect intervention. People resist in response to something. Something that we (or our clients) are doing evokes a reaction that we call resistance. The people resisting probably don’t see it as resistance; they see it as survival.
Resistance is a natural part of change. It protects people from harm. As a beginning downhill skier, it is resistance that keeps me from taking the chair lift to the top of Bodycast Mountain.
Three levels of resistance are identified. The better we are at identifying each of these Levels, the easier it will be to assist clients in creating strategies appropriate for the resistance they face.
Level 1 – Based on Information
This resistance is based on information. Facts, figures, ideas. It is the world of thinking and rational action. Level 1 is the world of presentations, diagrams, and logical arguments. Many make the mistake of treating all resistance as if it were Level 1. In other words, they give people more information–better arguments, detailed facts – when something completely different is called for.
Level 1 may come from . . .
* Lack of information
* Disagreement with the idea itself
* Lack of exposure
Level 2 – Physiological and Emotional Reaction: This Change Level 2 is an emotional and physiological reaction to the change. Blood pressure rises, adrenaline flows, pulse increases. It is based on fear: people fear they will lose face, friends, even their jobs. It is physiological and uncontrollable. Level 2 can be triggered without conscious awareness. They are what warns us of danger and allows us to take action instantly, before our conscious mind even knows what’s going on.
Imagine that you hear a loud crash as you read this sentence. You probably would cover your head and crouch instantly, and only then would you look up to see where the sound came from. You would have taken those actions without your conscious mind considering what to do. If the ceiling had been caving in, there would not have been time for a thoughtful reaction. Your rapid instinctive reaction could have saved your life.
Another practical example during the recession we saw during the yrs 2000-2002 will be, imagine a client talking to her staff about a proposed restructuring.
People ask Level 1 questions: How much will it cost? When will it begin? What’s the timeline? Then the executive happens to mention that there is slight possibility that this could result in downsizing. Suddenly, two-thirds of the room drops to Level 2. She may as well-quit going over slides that speak to the rational mind, these people are responding from a different part of the brain. The portion of the brain called the amygdala, has warned them that this is dangerous and they are literally preparing for fight or flight–even if they aren’t aware of it.
So, a meeting can continue as if everything was still Level 1. Polite questions are asked. Debates rage over budgets. But this all conceals the unspoken emotional reactions.
Level 2 may come from fear over a perceived . . .
* Loss of power or control
* Loss of status
* Loss of face or respect
* Feeling of incompetence
* Feeling of isolation or abandonment
* Sense that they can’t take on anything else (too much change)
Level 3 – Bigger Than the Current Change
This is deeply entrenched stuff and is bigger than the ideas at hand. People are not resisting the idea – in fact, they may love the idea itself – they are resisting the client or you. They may resist because of their relationship with you or the client. History tells them to be wary. Level 3 is also the domain of cultural, religious, and racial differences. In other words, people may resist whom you represent.
An African-American minister was being investigated for possible misuse of campaign funds. The cabinet voted to expel him, a strong and unprecedented action. A less surprising response would have been to censure him. The votes in favor of expulsion came mostly from whites; his support came mostly from blacks. In situations like this, each group wonders why the other side can’t see the situation for what it truly is. Each side
believes that the other is wrong. Even when confronted with the fact that our opinion is exactly what one would expect from someone of our race, we still can’t see it. We think it is based on a sound dispassionate assessment of the facts.
When we are locked in a Level 3 difference, it is difficult to see how our race, culture, sexual orientation, or religion limits our ability to see other points of view. When we are operating in a Level 3 situation it is unlikely that we can put much value on the ideas and opinions of the other side. In these instances, believing is seeing.
Level 3 may come from . . .
* Personal history of mistrust
* Cultural, ethnic, racial, gender differences
* Significant disagreement over values
* Transference. The person being resisted represents someone else such as a mother or father.
Challenges of Resistance, Working with Resistance
The Challenge of Resistance
Even when managers want to take resistance seriously and deal with it responsibly, most strategies are Level
1. There are beliefs that if they give people just a little more information then they will certainly come around.
Newsletters, videos, and PowerPoint are all Level 1 approaches. There is nothing wrong with presentations if people are confused or need more facts, but Level 1 tactics seldom work at Level 2 and 3.
Working with Resistance
Level 1 lends itself to presentations and question and answer sessions. Level 2, however, requires conversation in addition to presentation. Listening and meaningful dialogue are essential. Level 3 demands that you begin to rebuild relationships before you try to present new ideas. Or, at the very least, your change management strategies must include strategies that build bridges while you plan and implement.
Creating Cultural Change
Success in planned organizational change means creating a vision of the future organization and its culture. The values, beliefs, and attitudes of the To-Be organization must be clearly defined. The To-Be culture must be clearly differentiated from the As-Is culture to effectively identify the cultural gap. The organizational change method chosen to bridge the gap must match the values of the desired culture, not the present one. For example, if a Legitimacy-based organization wants to become databased, it should choose either a Functional/Structural Redesign, Business Process Reengineering, the Action Research Model, or a Strategic Redesign. On the other hand, a Fault-Driven organization that wants to become more strategic would need to choose either a Functional/Structural Redesign, Managerial Development, an Organization/Cultural Transformation, or Strategic Redesign.
Which of the possible methodologies is chosen should depend upon the managerial effectiveness culture wanted in the To-Be organization. In this way, it can guarantee that the values, beliefs, and attitudes of the change approach match those of the future culture. The Legitimacy-based organization that wants to become databased could choose a Rational Goal, Internal Process, Open System, or High Performing System type of culture. If the management feels that the key to organizational improvement is in smooth internal processes and process rationalization, the Internal Process approach to organizational effectiveness must be the final outcome. Therefore, the appropriate change method would be Business Process Reengineering. If the organization wants to become goal-driven, with goals of productivity and efficiency being paramount, the Functional/Structural approach would be most appropriate. Structures would need to be redesigned or reconfigured to allow such processes as departmental goal setting, super ordinate goals, and Management By Objectives. These changes would likely require corresponding functional restructuring, as new departments are created and new responsibilities allocated.
A Fault-Driven organization that wants to be more strategic may also find that key stakeholders in their environment will only accept well-known approaches to management–which experimentation is frowned upon. If these stakeholders control the purse strings, the organization must adopt a Legitimacy approach to managerial effectiveness. To achieve this, a strong, dynamic, charismatic leader using the Organizational/Transformation approach to change would be required.
It becomes obvious that the cultural goal must be determined before any steps are taken in a planned organizational change. The values, beliefs, and attitudes wanted in the To-Be organization should be the criteria for deciding which organizational method is used. For planned organizational change to be effective, it must be viewed as a cultural revolution carried out through behavioral modeling. The change approach that matches the desired organizational effectiveness culture prepares the membership to accept the new culture. In implementation, organizational members begin to behave in the desired To-Be way. Decisions are made in the change process using a value and belief system similar to the desired culture. Success criteria are the same in both the change process and the desired culture.
Human resources personnel responsible for implementing planned organizational change must keep track of the organizational culture and where that culture is headed. The Field and House typology of Organizational Effectiveness can be used to assess the As-Is and To-Be cultural gap. Once the To-Be culture is identified, the appropriate change method can be identified. If the appropriate organizational change method is used, the organization will be prepared to accept the new culture, making change easier to institutionalize. This procedure may not guarantee successful implementation and institutionalization of the changes but it will certainly improve the chances of success. If the cultural gap and change method are not matched, implementation will surely fail. An apple pie cannot be created using oranges.
Seven Phases of Initiating Process Change and Various Strategies
The Seven Phases of initiating process change and various strategies involved are:
a. Starting a Project
b. Commitment from Management
c. Discovering process based opportunities
d. Identify IT opportunities where they can be deployed for efficient usage
2. Planning for change
a. Inform stakeholders and organize re-generation team
b. Prepare project schedule and set performance goals
a) Document existing process
b) Uncover process pathologies
4. Social Re-Design
5. Technical Re-Design
a. Explore alternative designs (Will re-iterate till it meets the requirement/satisfied as laid in the
b. Design new process (creating a process change)
c. Design HR architecture (multi-discipline)
d. Selecting IT platform
6. Process Re-Generation
a. Implement HR changes
b. Develop & deploy IT support
c. Re-organizing: teams, jobs, and training
d. Top management communication and persuasion critical here
7. Continuous Improvement
a. Measure performance
Generic strategy paradigms
a. Reduced cycle time,
b. Order fulfillment (OF),
c. Operational problem with BPR as one part,
d. Cross-functional process aimed at operational optimization
a. Costs/cycle reduction,
c. BPR aim communication ties,
d. Cross-functional processes aimed at improving information flows
a. New product development,
c. Process capability/strategy/value chain,
d. Strategic Business Unit.
a. Change mindset/mission,
b. Cultural orientation,
c. Establish new managerial mindset/strategic focus,
d. Entire organization.