1. Chapter 6: ORGANIZATIONAL CHANGE
Business Leadership: Management Fundamentals John R. Schermerhorn, Jr., Barry Wright, and Lorie Guest
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2. Planning Ahead — Chapter 6 Learning Goals
Describe the nature of organizational change
Explain how planned organizational change be managed

3. 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
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4. Figure 6.1 Change leaders versus status quo managers
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5. Models of Change: Leadership
Top-down change:
Strategic and comprehensive change that is initiated with the goals of comprehensive impact on the organization and its performance capabilities
Driven by the organization’s top leadership
Success depends on support of middle-level and lower-level workers
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6. Models of Change: Leadership (cont’d)
Bottom-up change:
The initiatives for change come from any and all parts of the organization, not just top management
Crucial for organizational innovation
Made possible by:
Employee empowerment
Employee involvement
Employee participation
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7. Models of Change: Leadership (cont’d)
Integrated change leadership:
Successful and enduring change combines advantages of top-down and bottom-up approaches
Top-down:
Breaks up traditional patterns
Implements difficult economic adjustments
Bottom-up:
Builds capability for sustainable change
Builds capability for organizational learning
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8. Incremental and Transformational Change
Unplanned change
Response to unanticipated events
Good leaders act on opportunities for reactive change
Planned change
Aligning the organization with anticipated future challenges
Activated by proactive leaders who are sensitive to performance gaps
Transformational change: major and comprehensive redirection
Incremental change: adjusting existing systems and practices
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9. Incremental Change
Bends and adjusts existing ways to improve performance
Intent isn’t to break and remake the system but move it forward through continuous improvements
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10. Transformational Change
Results in a major and comprehensive redirection of the organization
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11. How to lead transformational change
Establish a sense of urgency for change
Form a powerful coalition to lead the change
Create and communicate a change vision
Empower others to move change forward
Celebrate short-term “wins” and recognize those who help
Build on success; align people and systems with new ways
Stay with it; keep the message consistent; champion the vision
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12. 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
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13. Internal Organizational Targets for change
Tasks
People
Culture
Technology
Structure
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14. 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.
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15. Figure 6.4 Lewin’s three phases of planned organizational change

16. Change Strategies Force-coercion strategy of change:
Uses power bases of legitimacy, rewards and punishments to induce change
Relies on belief that people are motivated by self-interest.
Direct forcing and political maneuvering
Produces limited and temporary results
Most useful in the unfreezing phase
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17. Change Strategies (cont’d)
Rational persuasion strategy of change:
Bringing about change through persuasion backed by special knowledge, empirical data, and rational argument
Relies on expert power
Relies on belief that reason guides people’s decisions and actions
Useful in the unfreezing and refreezing phases
Produces longer-lasting and internalized change
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18. Change Strategies (cont’d)
Shared power strategy of change
Engages people in a collaborative process of identifying values, assumptions, and goals from which support for change will naturally emerge
Time consuming but likely to yield high commitment.
Involves others in examining sociocultural factors related to the issue at hand
Relies on referent power and strong interpersonal skills in team situations
Relies on belief that people respond to sociocultural norms and expectations of others
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19. Figure 6.5 Alternative change strategies and their leadership implications
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20. Resistance to Change Reasons for people resisting change:
Fear of the unknown
Disrupted habits
Loss of confidence
Loss of control
Poor timing
Work overload
Loss of face
Lack of purpose
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21. Resistance to Change (cont’d)
Checklist for dealing with resistance to change:
Check the benefits – those involved see a clear advantage
Check the compatibility – keep change similar to existing values/processes
Check the simplicity – make it as easy as possible to understand
Check the triability – allow people to slowly try the change adjusting as progression is made
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22. Challenges of Technological Change
Improvisational change
Makes continual adjustments as changes are implemented
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23. COPYRIGHT
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