hrm_manag & org change

7/28/2019 HRM_Manag & Org Change

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Management andOrganizational Change



The concept and nature of Change

The term „change' refers to any alteration which

occurs in the following characteristics-

i. Change results from the pressure of forces which

are both outside and inside the organization.

ii. The whole organization tends to be affected by

change in any part of it.

iii. Change takes place in all parts of the organization, but at varying rates of speed and degrees of

significance.



The concept and nature of Change

Change is a continuous phenomenon of

organizational life. The survival and growth of an

organization depends to a great extent on its ability

to cope with change required by forces operatingwithin its boundaries and in its external environment.

Any change in its environment, such as changes in

consumer tastes and preferences, competition,economic policies of the government, etc., make it

imperative for an organization to make changes in its

internal system.



Forces For Change

Organizations depend must interact with their external

environment in order to survive and grow. They get

inputs from their environment, transform them

through various processes and export outputs to theenvironment.

They take what environment gives and give what

environment wants. Thus, organizations areconstantly responding to their external environment

by making necessary changes in the internal

environment



Forces for change: External Forces

1) Technology – It is the major external force whichcalls for change. The rate of technological changes isgreater today than any time in the past and

technological changes are responsible for changingthe nature of jobs performed at all levels in theorganization.

E.g., computer technology and automation have made a

remarkable impact on the functioning of organization.

Japanese firms have progressed rapidly because they are

very fast in adopting to new technology.



External Forces

2) Marketing Conditions – Market conditions are no

more static. They are in the process of rapid change

as the needs, desires and expectations of the

customers change frequently.

There is a tough competition between

manufacturers and suppliers in the market. The

market is flooded with new products and innovationseveryday. All these factors put great pressure on the

modern organizations to change their technological

and marketing strategies.



External Forces

3) Social Change – Due to spread of education,

knowledge explosion and Government‟s efforts,

social changes are taking place at a faster rate.

The drive for social equality e.g., equal

opportunity to women, equal pay for equal work, has

posed new challenges for the management. The

management has to follow social norms in shapingits employment, marketing and other policies.



External Forces

4) Political Forces – Political forces within and outsidethe country have an important influence on large business houses, particularly the transnational

corporations.The relation between government and

business houses has become very complex inmodern times. Interference of government in

business houses has become very complex.Organizations have no control over the

political and legal forces, but they have to adapt tomeet the pressures of these forces.



Internal Forces

1) Changes in Managerial Personnel – Old managersare replaced by new managers due to retirement, promotion, transfer or dismissal. Each manager

brings his own ideas and way of working within theorganization.

The relationships, more particularlyinformal ones, change because of changes in

managerial personnel. As result an organization hasto change accordingly.

Changes in the organization are quite fastwhen executives at the top change.



Internal Forces

2) Change in Operative Personnel – The make up of the

workforce is changing fast. New workers have better

educational qualifications, place greater emphasis on

human values and question authority of managers.

Their behavior is very complex and leading

them for organizational goals is really a challenge.

The changing personnel certainly act as a pressurethat has to be handled properly by the organization.



Internal Forces

3) Deficiencies in Existing Structures – Changes may be needed to rectify deficiencies in the presentorganizational set up. These deficiencies may be in

the form of unmanageable span of management,larger number of managerial levels, lack incoordination between various departments, obstaclesin communication, lack of uniformity in policy

decisions, lack of co-operation between line andstaff.

However, the need for change in such casesgoes unrecognized until some major crisis occurs.



Internal Forces

4)Changes in employee expectations – organizations hire

new comers who have a set of expectations which are

very different from those expressed by older workers.

Today's workforce is more educated & hence also

tend to demand more from employers.

The new generation is not just career minded, rather they

are more concerned about their career as well asfamily due to which they often seek flexible work

timings or opportunities to work at their own pace.



Types Of Organizational Change

1. Reactive change: reactive change occurs when forces to change

make it necessary for a change to be implemented. New strategic

moves made by competitors, new technological discoveries &

performance problems are common reasons for reactive change.

2. Planned change: it occurs when leaders in the organization

recognise the need for a major change & proactively organize a

plan to accomplish the change. Strategic plans for reorganization

are a part of planned change.

3. Incremental/Evolutionary change: incremental change is anongoing process of evolution overtime during which many small

changes occur routinely. Over time, the many small changes may

be used to transform the entire organization. It is focused on units

& sub units within an organization.



Types Of Changes

4. Revolutionary change: this change is rapid & dramatic.

Revolutionary change involves a bold attempt to quickly find

new ways to be effective which is likely to result in a radical

shift of doing things, new goals & new structure of the

organization. This process has repercussions on all levels of

the organization.

5. Strategic change: it is the change in the very basic mission of

the organization. A simple objective may have to be changedto achieve the mission of the organization. For eg: Indian

companies are being modified to accommodate various

aspects of global culture brought in by the multinational

companies.



Types Of Changes

6. Process oriented change: these changes are related to the recent

technological developments & automation. This will involve

retraining personnel, equipment investments & operational

changes to accommodate the change brought about due to external

forces. All this effects the organizational culture & as a result the behaviour pattern of the employees.

7. People oriented change: these changes are directed towards

performance improvement, team building, loyalty towards the

organization & developing a sense of self actualization amoingmembers. This can be made possible by special behavioral

training & modification sessions.



Types Of Changes8. Operational change: this is required when a organization needs to

improve the quality of its products or services due to externalcompetition, customers changing requirements & demands or internal organizational dynamics. It focuses on improvement of existing operations to perform better. It includes bringing in new

technology, re-engineering the work processes, better distribution& delivery of products etc.

9. Structural change: involves changing the internal structure of theorganization. This change is directed towards work relationships,work assignments & authority structure.

10. Total change: this change in necessary to remove the organizationfrom its negative practices due to long term failure of business,employee conflicts , power in the hands of few people who pursuetheir own interests at the cost of the organization. Total change re-modifies the entire system to bring about a positive change.



Process of organizational change:

Evaluating the change

Managing the transition state

Generating motivation for change

Implementing the change

Identifying the cause of the problems

Problem Recognition



Process of organizational change:

1. Problem Recognition: in this stage, the management acknowledges &

recognizes the problems which exists in the organization. Employee

turnover, absenteeism, union disputes, employee grievances, role

conflicts & declining profits are some of the problems which affects the

productivity of the organization.2. Identifying the cause of the problems: in this stage, the managements

tries to find out the root cause of the problems identified in the 1st stage.

For eg: is declining profitability is the problem identified, it could be due

to reasons such as low employee productivity, reduction in orders from

customers etc.

3. Implementing the change: after holding discussions with the employees

& analysing the feedback gathered through questionnaires, the

management will be able to identify the underlying causes of the

problems. The management then designs a change plan to improve thesituation & solve the problems.



Process of organizational change

6. Supporting the change: to implement the change successfully,

management must obtain the support & cooperation of various

employee groups. This can be achieved through negotiation, co-optation

& compromise. Failure in attaining the support of employee groups may

result in strong resistance to the change program.7. Evaluating the change: after implementation, the changes must be

evaluated to check whether the new system has been able to solve the

problems identifies in the old system & whether the desired future state

has been attained. In case something has gone wrong, al the stages of the

change process from the problem diagnosis to evaluation stag must berepeated once again.



Kurt Lewin's theory of change:




1. Unfreezing:

Unfreezing calls for loosening the emotional link with the old

work methods & practices, it leads to unlearning of old things to

learn new ones.

Individuals are made to feel that they have to give up the old work

habits, for learning new types of behavior.

The forces which drive change should be strengthened & forces

which discourage change should be weakened.

Rewards may be offered to those who accept change & the

employees who resist change must be persuaded to accept change.




2. Change:

once employees become receptive to change, the manager should

introduce the proposed change in a systematic manner with full

cooperation of subordinates.

They should be guided & helped to learn new methods & techniquesrequired in the proposed change.

3. Refreezing:

This is the phase of stabilization & institutionalization of changes which

are successfully implemented. Changes which are accomplished should remain as a stable & permanent

characteristics of the system until need arises for another change.

The new roles & behaviors must be used as a habit, otherwise employees

might revert to old practices after some time.



Resistance to Change

The most-needed and best-planned change carries no

guarantee that it will be accepted.

As common as change is, the people who work in an

organization may still not like it. Each of those“routine” changes can be accompanied by tension,

stress, squabbling, sabotage, turnover, subtle

undermining, behind the scenes foot-dragging, work slowdowns & needless political battles




The sources of resistance to change on the part of

individuals are discussed below:

a. Economic Factors – These factors relate to the basic

economic needs of the workers like necessaries of life, job security and safety.

b. Social Factors – Individuals do have certain social

needs like friendship, belongingness, etc. for thefulfillment of which they develop informal relations

in the organization. They become members of

certain informal groups and act as members of the

group to resist change.




c. Psychological Factors – These factors arise when

workers perceive that factors relating to their

psychological needs will be affected adversely by

the proposed changes.These needs are sense of pride of achievement, of

self – fulfillment, etc.

Employees may apprehend boredom andmonotony in the new jobs as a result of

specialization brought in by the new technology.



Causes of Resistance to Change

Employees may resist a change because they do not

want to take trouble in re-learning the new things.

Employees may not have the knowledge of entire

change or they may be incapable of understanding the

implications of new ideas or methods.



Organizational Resistance to Change

The sources of organizational resistance to change are

as follows: (1) Threat to Power - Top managers may consider change as a potential threat to their power and influence in the organization due towhich the change will be resisted by them. Top management will notlike to take steps by which the position of trade union is strengthened.

(2) Organization Structure – Mechanistic organizationstructure has a built-in tendency for resistance to change. The reasonfor this is that people who work in mechanistic structure are expected toact in a certain way, they do no develop the initiative to adjust their

behavior to changing conditions.

3) Organizational culture: the values & norms in an organizations culture can be another source of resistance to change. Sometime the values & normsare so strong that even when the environment is changing, managersfind it difficult to change due to the attachment to existing business

practices.



Organizational Resistance to Change

4. Differences in functional orientation: differences in functionalorientation are another major impediment to change. Differentfunctions & divisions often see the source of problem based ontheir own view points. This tunnel vision increases organizational

resistance. Companies must spend time & effort to reach to anagreement regarding the source of a problem.



Managing Resistance to Change

Resistance to change is a type of human behavior

which arises to protect human beings from the real or

perceived effects of change.

Change is a necessary way of life for any

individual or organization. An organization which does

not change when the forces of change require, its

survival will be in danger.

It is the responsibility of management to bring the

necessary changes by overcoming the resistance put

by the workers.



Overcoming Resistance to Change

The following strategies should be followed to

successfully implement changes:

1) Participation & Involvement: employees find it difficult to resist change which

they have participated in. Prior to making a change, all those employees who

will be affected by the change, must be brought into the decision making process. Their involvement can overcome resistance

2) Communication & Education: If employees do not have adequate information

regarding the upcoming change, then it is necessary to educate them about the

change – when it is to be introduced, why is the change needed now, its

implementation, process & working.

3) Negotiation & Agreement: this technique is used when costs & benefits must

be balanced for the welfare of the management as well as employees. This is

often used in bargaining with labour unions where they might end up gaining

very little due to the change & thus resist change.



Overcoming Resistance to Change4) Timing of change: the timing of introducing the change can have considerable impact on

resistance. There is always a right time for introducing something new. This is specially

true for employees who have a psychological relationship with the group to ensure

group togetherness

5) Building support & commitment: change agents offer a wide range of support for reducing

resistance to change. When employees fear & the anxiety levels are high, employeecounselling, new skills training etc may facilitate adjustment.

6) Leadership: Managers have considerable influence on employees who can be used to

motivate employees & help them be a part of change.

7) Selecting people who accept change: the ability to accept & adapt change is related to

personality. Employees who adapt to change are those who are open to experience,

willing to take risks, flexible & have a positive attitude to change. Hence organizations

must facilitate change by selecting those people who have the above characteristics.

8) Coercion: is the application of force on those who resist change. For eg: if management is

determined to close a manufacturing plant if employees don‟t agree to a pay cut, then

coercion are threats of transfer, loss of promotions etc.



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hrm_manag & org change

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