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Steven E. Phelan, November 2008. Change is a risky activity Many organizational changes fail or do not realize their intended outcomes (50-70%). This.

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Presentation on theme: "Steven E. Phelan, November 2008. Change is a risky activity Many organizational changes fail or do not realize their intended outcomes (50-70%). This."— Presentation transcript:

1 Steven E. Phelan, November 2008

2 Change is a risky activity Many organizational changes fail or do not realize their intended outcomes (50-70%). This raises the question of why change is so prevalent? Pressure to change comes from: External, environmental pressures Internal, organizational pressures

3 PressureExamplesDescription Market decline pressures Harley Davidson When current markets that the organization operates in begin to decline there is pressure to find newer, more viable markets. Hypercompetition pressures Intel This affects the way organizations respond to their consumers and their competitors to cater for the increasingly rapid pace of business. Reputation and credibility pressures Walt Disney Company In light of recent corporate governance scandals in organizations, the pressure to maintain a good reputation and high level of credibility has increased.

4 PressureExamplesDescription Fashion pressures Boeing Co. This is based on mimetic isomorphism – imitating companies that are legitimate and successful Mandated pressures Chevron Texaco This is based on coercive isomorphism – when change is demanded by outside sources. Geopolitical pressures 3M This is when global crises greatly impact an organization and change is necessary for survival.

5 PressureExamplesDescription Growth pressuresMicrosoft Existing systems and processes in a smaller organization may no longer be applicable when the size of the organization increases. Integration and collaboration pressures EDS Integration and creating economies of scale can lead to pressure for change in organizations. Identity pressuresForte Hotel A common organizational identity and the unified commitment of staff in different areas/departments of an organization can be difficult to manage and may encourage change.

6 PressureExamplesDescription New broom pressures UNLV New authority figures in an organization can herald a new era and often signal significant changes an organization in an organization. Power and political pressures Morgan Stanley Power relationships and politicking can change internal processes and decision making. This has significant flow on effects within the organization.

7 Take five minutes to personally answer these questions: Have you (or someone you know) ever experienced organizational change? What was your view of the change? What did others think of the change? Who were the change champions? How did they behave?

8 Perform the following activities in your group: Share your stories with members of your group What are the common issues? What are the differences? Are there “lessons” embedded in these stories? What three conclusions do you draw from these stories about managing change?


10 Controlling… –Top-down view of management –Fayol’s theory of management: planning, organizing, commanding, coordinating and controlling. Shaping… –Participative style of management –Improving the capabilities of people within the organization

11 Intended Change: –Change is a result of planned action Partially Intended Change: –Change may need to be re-modified after it is initially implemented Unintended Change: –Forces beyond the control of the change manager

12 Images of Managing Controlling... (activities) Shaping... (capabilities) Images of Change Outcomes IntendedDIRECTORCOACH Partially IntendedNAVIGATORINTERPRETER UnintendedCARETAKERNURTURER

13 Director Based on an image of management as control and of change outcomes as being achievable. Supported by the n-step models and contingency theory. Coach Relies upon building in the right set of values, skills and “drills” that are deemed to be the best ones that organizational members will be able to draw on in order to achieve desired organizational outcomes. Related to organizational development approaches.

14 Navigator Control is still seen to be at the heart of management action, although a variety of factors external to managers mean that while they may achieve some intended change outcomes, others will occur over which they have little control. Supported by the contextualist and processual theories of change. Interpreter The manager creates meaning for other organizational members, helping them to make sense of various organizational events and actions. Supported by the sense- making theory of organizational change and concept of ‘enactment’

15 Caretaker The change manager’s ability to control is severely impeded by a variety of internal and external forces beyond the scope of the manager. The caretaker is seen as shepherding their organizations along as best they can. Supported by life-cycle, population-ecology and institutional theories. Nurturer Even small changes may have a large impact on organizations and managers are not able to control the outcome of these changes. However, they may nurture their organizations, facilitating organizational qualities that enable positive self- organizing to occur. Related to chaos and Confucian/Taoist theories.

16 To what extent are you more comfortable with one or other of the six images? Why is this the case? What are the strengths and limitations of the images that you have identified as most relevant to you? What skills do you think are associated with each image? Are there areas of personal skill development that are needed for you to feel more comfortable in using other images? Have you ever been in an organization that was dominated by particular images? What barriers to alternative images existed in this organization? What strategies could overcome these barriers?

17 Surfacing our assumptions about change Images simplify & illuminate but also obscure Assessing dominant images of change To what degree are some images seen as natural and not open to negotiation in certain organizations Using multiple images in change Image-in-use might depend on the type of change Image-in-use might depend on the context Image-in-use might depend on the phase of change Multiple change images can also co-exist Skilled change managers are able to swap images or even manage multiple images simultaneously

18 Typical questions about change: Was it managed well? What went right? What went wrong? Did we get the outcome we were after? Do these questions assume a certain image of change? How does each image assess success? Which images have “non-traditional” success measures? “Judgments of success are conditional on who is doing the assessment and when the judgments are made” Is this true?

19 Take your group’s stories from earlier in the day Which images of change did you come across? How did these images affect the way the various actors approached change? Do the images used vary by the type, context, or phase of change? What broad conclusions can you form?

20 Questions: Which of the six change images were held by: Gunter? The hospitality literature? The consultant? How did these assumptions influence prescriptions for dealing with “the turnover problem” What does it mean to say the problem was ‘dis- solved’? Choose another change image and apply it to “the turnover problem” What new insights arise? Does considering different images of change help us (I hesitate to add ‘solve the problem’)?


22 The goal of change management is to dupe slow-witted employees into thinking change is good for them by appealing to their sense of adventure and love of challenge This is like convincing a trout to leap out of a stream to experience the adventure of getting deboned

23 Active signs of resistance Being critical Finding fault Ridiculing Appealing to fear Using facts selectively Blaming or accusing Sabotaging Intimidating or threatening Manipulating Distorting facts Blocking Undermining. Starting rumors Arguing Passive signs of resistance Agreeing verbally but not following through (“malicious compliance”) Failing to implement change Procrastinating or dragging one’s feet Feigning ignorance Withholding information, suggestions, help, or support Standing by and allowing change to fail Which of the various ways of resisting change are the most common? Which are the most difficult to deal with?

24 Dislike of change People don’t resist change, they resist pain! Boredom can be pain, too. Discomfort with uncertainty Low tolerance for ambiguity Perceived negative effects of interests Authority, status, rewards, salary, social ties Attachment to the established culture/ways of doing things Perceived breach of psychological contract

25 Lack of conviction that change is needed Lack of clarity as to what is needed Belief that the specific change being proposed is inappropriate Belief that the timing is wrong Excessive change Cumulative effects of other changes in one’s life Perceived clash with ethics Reaction to the experience of previous changes Disagreement with the way the change is being managed

26 Security Money Authority Status/prestige Responsibility Better working conditions Self-satisfaction Better personal contacts Less time and effort

27 The classic steps: Education and communication Participation and involvement Facilitation and support Beyond the classic steps: Negotiation and agreement Manipulation and cooptation Explicit and implicit coercion The Paula Story Does a successful change manager needs skills in all six areas? Where do you need development?

28 Resistance is a natural (even necessary) psychological stage in any change: Denial/Shock Resistance/Anger Exploration/Mourning Commitment /Acceptance Do we just ‘let nature take its course’ then? Can people get stuck in a stage?

29 Use the power of resistance to build support Showing respect towards resistors creates stronger relationships and thereby improves the prospects of success Fundamental touchstones Maintain clear focus Embrace resistance Respect those who resist (assume good faith) Relax Join with the resistance Look for points of commonality

30 Use power Manipulate those who oppose Apply force of reason Ignore resistance Play off relationships Make deals Kill the messenger Give in

31 Contingency approaches challenge the view that there is “one best way” The style of change will vary, depending upon the scale of the change and the receptivity of organizational members for engaging in the change. Kotter and Schlesinger recommend changing tactics according to the: Amount and kind of resistance anticipated The position and power of the change agent The personality of the person designing and implementing the change The time available and the consequences of failure

32 Which approach to the management of resistance attracts you? Why?

33 Task Develop a formal integration plan (with decisions on branch closures, systems conversion, product alignment, layoffs, and communication strategy) that will maximize shareholder value while keeping as much support as possible from the stakeholders at the two banks and external organizations. 10 minutes = 1 news cycle = 1 day



36 Other Roles Change Manager: Tod Journalist: Lorri Union Organizer: Anita State Regulator: Keith Admin Assistant: Scott EastWest Bank: Brian Largest Customer: Kris Branch Employee: Jocylene

37 Donna Dubinsky

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