Chapter 9 Innovation And Organizational Change

 Creativity - the generation of a novel idea or unique approach to solving problems or crafting opportunities.  Innovation - the process of creating new ideas and putting them into practice.

TYPES OF INNOVATION BUSINESS INNOVATIONS  Product Innovation  Process Innovation  Business Model Innovation SUSTAINABLE INNOVATIONS  Sustainable Innovation (Green Innovation) SOCIAL BUSINESS INNOVATIONS

The Innovation Process 1. Imagining 2. Designing 3. Experimenting 4. Assessing 5. Scaling  Commercializing innovation ◦ Process of turning new ideas into products or processes that increase profits through sales or cost reductions.

Organizational Change  Change leader. ◦ A change agent who takes leadership responsibility for changing the existing pattern of behaviour of another person or social system.  Change leadership. ◦ Forward-looking. ◦ Proactive. ◦ Embraces new ideas.

Models of Change Leadership Top-Down Change – change initiatives come from senior management Bottom-Up Change – change initiatives come from all levels in the organization Integrated Change – Successful and enduring change combines advantages of top-down and bottom-up approaches.

Incremental and Transformational Change Reactive Change Performance Gap Planned Change Incremental Change Transformational change

Forces and Targets for Change  External forces for change : ◦ Globalization. ◦ Market competition. ◦ Local economic conditions. ◦ Government laws and regulations. ◦ Technological developments. ◦ Market trends. ◦ Social forces and values.  Internal forces for change : ◦ Arise when change in one part of the system creates the need for change in another part of the system. ◦ May be in response to one or more external forces.

Forces and Targets for Change  Organizational targets for change : ◦ Tasks ◦ People ◦ Culture ◦ Technology ◦ Structure

Managing Planned Change  Phases of planned change ◦ Unfreezing  The phase in which a situation is prepared for change and felt needs for change are developed. ◦ Changing  The phase in which something new takes place in the system, and change is actually implemented. ◦ Refreezing  The phase of stabilizing the change and creating the conditions for its long-term continuity.

Change Strategies Force-Coercion Strategies – change through formal authority and/or the use of rewards or punishments Rational Persuasion Strategies – change through empirical data and rational argument Shared Power Strategies – change by participation in assessing change needs, values and goals.

Reasons for people resisting change o Fear of the unknown o Disrupted habits o Loss of confidence o Loss of control o Poor timing o Work overload o Loss of face o Lack of purpose

Dealing with Resistance to change Check the benefits – what in it for me, them, us Check the compatibility – keep change as close to existing ways as possible Check the simplicity – easy to understand and use, ease of access to information Check the ‘Tryability’ – allow people try change little by little, no rush

 Organization development (OD) - a comprehensive approach to planned organizational change that involves the application of behavioral science in a systematic and long-range effort to improve organizational effectiveness.

 Organization development goals: ◦ Outcome goals focus on task accomplishments. ◦ Process goals focus on the way people work together. ◦ OD seeks to develop the organization members’ capacity for self-renewal. ◦ OD is committed to change through freedom of choice, shared power, and self-reliance. ◦ OD takes advantage of knowledge about human behaviour in organizations.

 The organization development process: ◦ Establish a working relationship. ◦ Diagnosis. ◦ Intervention. ◦ Evaluation. ◦ Achieve a terminal relationship.

Action Research  Steps in the action research process: ◦ Data gathering. ◦ Data analysis and feedback. ◦ Action planning. ◦ Action implementation. ◦ Evaluation and follow-up.

Organization Development Interventions  Individual OD interventions ◦ Sensitivity training (T-groups) ◦ Management training ◦ Role negotiation ◦ Job redesign ◦ Career planning

 Team OD interventions ◦ Team building ◦ Process consultation ◦ Inter-group team building  Organization-wide OD interventions ◦ Survey feedback ◦ Confrontation meeting ◦ Structural redesign ◦ Management by objectives (MBO)