1. Organizational Change

2. Organizational Change at Home Depot
Home Depot CEO Robert Nardelli (left in photo) has dramatically changed the big box retailer’s culture by introducing systems that reinforce the new values.

3. Force Field Analysis Model
Driving
Forces
Restraining
Desired
Conditions
Driving
Forces
Restraining
Driving
Forces
Restraining
Current
Conditions
Before Change
During Change
After Change

4. Resistance to Change Forces for Change Direct Costs Saving Face
Fear of the Unknown
Breaking Routines
Incongruent Systems
Incongruent Team Dynamics
Forces for
Change

5. Resisting Change at the FBI
The FBI has been slow to shift from law enforcement to domestic intelligence due to:
Incongruent systems -- career paths, reward system, decentralized structure
Breaking routines -- unfamiliar with intelligence gathering roles
Saving face -- past turf wars with CIA created an anti-investigation mindset
AP/ Wide World Photos

6. Creating an Urgency for Change
Inform employees about driving forces
Most difficult when organization is doing well
Must be real, not contrived
Customer-driven change
Adverse consequences for firm
Human element energizes employees

7. Minimizing Resistance at Nissan
© Eriko Sugita/Reuters/Corbis
Carlos Ghosn launched a turnaround at Nissan Motor Company that saved the Japanese automaker and relied on change management practices rarely seen in Japan. Employee involvement was a key strategy to minimize resistance to the turbulent changes that occurred.

8. Minimizing Resistance to Change
Communication
Highest priority and first strategy for change
Improves urgency to change
Reduces uncertainty (fear of unknown)
Problems -- time consuming and costly

9. Minimizing Resistance to Change
Communication
Provides new knowledge and skills
Includes coaching and action learning
Helps break old routines and adopt new roles
Problems -- potentially time consuming and costly
Learning

10. Minimizing Resistance to Change
Communication
Increases ownership of change
Helps saving face and reducing fear of unknown
Includes task forces, future search events
Problems -- time-consuming, potential conflict
Learning
Employee Involvement

11. Minimizing Resistance to Change
Communication
When communication, training, and involvement do not resolve stress
Potential benefits
More motivation to change
Less fear of unknown
Fewer direct costs
Problems -- time-consuming, expensive, doesn’t help everyone
Learning
Employee Involvement
Stress Management

12. Minimizing Resistance to Change
Communication
Learning
When people clearly lose something and won’t otherwise support change
Influence by exchange-- reduces direct costs
Problems
Expensive
Gains compliance, not commitment
Employee Involvement
Stress Management
Negotiation

13. Minimizing Resistance to Change
Communication
Learning
When all else fails
Assertive influence
Firing people -- radical form of “unlearning”
Problems
Reduces trust
May create more subtle resistance
Employee Involvement
Stress Management
Negotiation
Coercion

14. Refreezing the Desired Conditions
Realigning organizational systems and team dynamics with the desired changes
Alter rewards to reinforce new behaviors
Feedback systems
Help employees learn how they are doing
Provide support for the new behavior patterns

15. Strategic Vision & Change
Need a vision of the desired future state
Identifies critical success factors for change
Minimizes employee fear of the unknown
Clarifies role perceptions

16. Change Agents Change agents apply transformational leadership
Help develop a vision
Communicate the vision
Act consistently with the vision
Build commitment to the vision
Also apply transactional leadership
Aligning employee behavior through rewards, resources, feedback ,etc.

17. Diffusing Change with MARS Model
Motivation
Successful pilot project
Supervisor support and reinforcement
Ability
Competencies to adopt pilot project
Role modeling from people in pilot project
Role perceptions
Translating pilot project practices -- neither too specific nor too general
Situational factors
Resources and time to implement pilot project elsewhere

18. Action Research Approach
Change needs both action and research focus
Action orientation
Solve problems and change the organizational system
Research orientation
Concepts guide the change
Data needed to diagnose problem, identify intervention, evaluate change

19. Action Research Process
Establish
Client-
Consultant
Relations
Diagnose
Need for
Change
Introduce
Intervention
Evaluate/
Stabilize
Change
Disengage
Consultant’s
Services

20. Appreciative Inquiry at Canadian Tire
Canadian Tire relied on appreciative inquiry by asking staff to describe events that have made the retailer successful. The company’s core values were then rebuilt around those positive experiences. Store employees were also involved in an appreciative inquiry exercise to reinforce these values.

21. Appreciative Inquiry Approach
Directs participants’ attention away from problems and towards the group’s potential and positive elements.
Reframes relationships around the positive rather than being problem oriented

22. Four-D Model of Appreciative Inquiry
Discovery
Dreaming
Forming ideas about “what might be”
Designing
Engaging in dialogue about “what should be”
Delivering
Developing objectives about “what will be”
Discovering the best of “what is

23. Parallel Learning Structure Approach
Highly participative social structures
Members representative across the formal hierarchy
Sufficiently free from firm’s constraints
Develop solutions for organizational change which are then applied back into the larger organization

24. Parallel Learning Structures
Organization

25. Cross-Cultural and Ethical Concerns
Cross-Cultural Concerns
Linear and open conflict assumptions different from values in some cultures
Ethical Concerns
Privacy rights of individuals
Management power
Individuals’ self-esteem
Consultant’s role

26. Rules for the Road Ahead
Understand your needs and values
Understand your competencies
Set career goals
Maintain networks
Get a mentor

27. Organizations are About People
“Take away my people, but leave my factories, and soon grass will grow on the factory floors. Take away my factories, but leave my people, and soon we will have a new and better factory.”
Andrew Carnegie ( )

28. Organizational Change

29. Discussion of Activity 17.3 Strategic Change Incidents

30. Scenario #1: “Greener Telco”
Scenario #1 refers to Bell Canada’s Zero Waste program, which successfully changed wasteful employee behaviors by altering the causes of those behaviors.
Courtesy of Bell Canada

31. Bell Canada’s Change Strategy
Relied on the MARS model to alter behavior:
Motivation -- employee involvement, respected steering committee
Ability -- taught paper reduction, , food disposal
Role perc. -- communicated importance of reducing waste
Situation -- Created barriers to wasteful behavior, eg. removed trash cans
Courtesy of Bell Canada

32. Scenario #2: “Go Forward Airline”
Scenario #2 refers to Continental Airline’s “Go Forward” change strategy, which catapulted the company “from worst to first” within a couple of years.

33. Continental Airlines’ Change Strategy
Communicate, communicate, communicate
Introduced 15 performance measures
Established stretch goals (repainting planes in 6 months)
Replaced 50 of 61 executives
Rewarded new goals (on-time arrival, stock price)
Customers as drivers of change