Change Management

University Degree Business and Administrative studies

Change Management

ORG502: Human Relations and Organizational Behavior

Introduction

Synergetic Solutions Incorporated (Organizational structure, 2005) is in a situation most successful organizations experience over time. Synergetic Solutions has experienced stagnation in its primary business, systems integration. There are numerous courses of action a company may choose in this situation. One option would be to make no changes and wait for the market to recover. Another option would be to undertake some changes in an effort to counteract the market stagnation.

An overview of the Chief Executive Officer’s (CEO) and Chief Operating Officer’s (COO) solutions to change within their organization will be provided. An explanation of different change models followed by an in-depth demonstration of Lewin’s Force Field Analysis Model for change will be used to show how using thoughtful and well-planned actions can control change within an organization.

An Overview of Change Management Theories

Change management methodologies reflect the internal structure of an organization; mechanistic organizations tend toward procedural interventions and organic organizations tend toward whole system interventions. According to Newman and Fitzgerald (2001), Lewin’s Force Field Analysis model for change and “action research underlie(s) most current OD approaches” (p. 1), but

Current practice goes beyond original formulations to emphasize…emergent processes. Newer action research approaches include ‘participatory action research’, ‘action science’, ‘action learning’, and ‘appreciative inquiry’, these contemporary approaches might be viewed as extending the action research ‘continuum’ that ranges more traditional consultant directed linear applications toward increasingly collaborative, systemic, transformational change processes (Newman and Fitzgerald, 2001, p. 1).

Boog, Keuhne and Tromp (2003), echoing the same point of view, characterized action research as having poles,

On the one pole, there is action research that is first and foremost meant to mobilize people and resources…for certain pre-established ends which are not further questioned. On the other pole, there is action research that opts for a principally open approach in which it is of vital importance to investigate thoroughly what the actual problem is…that enhances the position of the actors…and increases their skills and possibilities to influence their situation (p. 420).

Appreciative inquiry is one of the later change management methodologies. Appreciative inquiry, says Mellish (1999),

Is not a technique; it cannot be applied as a mechanism for change. It cannot be contrived. The approach requires willingness on behalf of the advocate and the client to search systematically for possibilities and potential, and to provide scope for diversity and synergy to coexist in pursuit of collective interest based mutual understanding (p. 5).

Mellish’s statement, “synergy to coexist in pursuit of collective interest based in mutual understanding” is recognizable in the other “pole” of change management theory, whole systems theory (p. 5).

Manning and Binzagr (1996) wrote that whole systems methodologies are based on six assumptions:

1. Organizations are viewed as whole systems. (Synergy)

2. Viewing organizations as whole systems requires the creation of dialogue among all organizational stakeholders. (Mutual Understanding)

3. Organizations do not exist, but organizing processes and procedures do. (Collective Interests)

4. What we perceive as our collective organization reality becomes the organization that is created. (Synergy and Mutual Understanding)

5. Individuals within an organization have the capability to self organize and redefine their reality. (Coexist in pursuit of Collective Interests)

6. Humanity shares a set of universal values that are inherently ‘good’ and these values will ultimately influence voluntary collective action. (Synergy to coexist in pursuit of collective interest-based on mutual understanding) (p. 268).

Whole system methodologies, one of which is the whole scale change model, act on the whole system using “processes of information sharing, relationship-building and co-creation of identity” (Arena, 2003, p. 1). The basic assumptions of whole scale change are:

1. Living systems identify new potential through information sharing.

2. Living systems generate order through relationships.

3. Living systems organize at a higher level around identity. (Arena, 2003, pp. 2-3)

Synergetic Solutions Inc, Change Management Case Study

Harold Redd, CEO of Synergetic Solutions, decided to venture into a new market, networking solutions, with surprising initial success. The success of the initial foray prompted the CEO to develop a new vision for his company. The newly revamped company would generate 80% of its total revenue from networking solutions. Implementation of the new business paradigm required substantial changes in ...

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1. Living systems identify new potential through information sharing.

2. Living systems generate order through relationships.

3. Living systems organize at a higher level around identity. (Arena, 2003, pp. 2-3)

Synergetic Solutions Inc, Change Management Case Study

Internal and External Drivers of Change

Lewin's Force Field Analysis Model of organizational change suggests that certain driving forces “push organizations toward a new state of affairs” (University of Phoenix. (Ed.), 2005, p. 476). These driving forces can be external or internal. Three external drivers of change affecting Synergetic Solutions can be identified:

1. The stagnating systems integration market. This condition drove the CEO of Synergetic Solutions to venture into the networking solutions market.

2. A positive initial foray into the networking solutions market. This success drove the CEO to train and certify some of his best employees in networking technologies.

3. Competitors trying to entice away employees who had been trained as network architects and solution designers. This drove Synergetic Solutions to take action to try and retain employees, as well as to be prepared for the possible departure of those employees.

Three internal drivers of change at Synergetic Solutions include the following:

1. The vision of CEO Harold Redd to try entering the networking solutions market, and then when those efforts were initially successful, his decision to make networking solutions the primary focus of Synergetic Solutions. Harold Redd's vision and actions were the fundamental driving forces in this entire process.

2. Quarterly growth targets for revenue and employee involvement. These targets drove the employees to try to reach Harold Redd's goals.

3. The need to build employee skill sets and raise pay accordingly. These needs drove the CEO to offer incentives for competency growth and variable pay packages.

Organizational Factors Weighed to Assure Successful Change

The COO of Synergetic Solutions must weigh several factors to determine the implications on the company if he wants to move the company forward into a "networking design "hothouse" from just a computer trading organization" (Organizational structure, 2005). One factor the COO should weigh is the importance of the project. The COO should not create a project just to create work for the team or employees. The project must have meaning or there will be resistance by the team for a change that would causes more anxiety than good. The COO also needs to keep in mind what team or person will be best suited for the task weighing the team's or person's skills and talents. Assigning the wrong task to a team or employee could not only lead to failure but resistance by that team or employee to the change. Additionally, the COO should analyze the internal and external forces as described in Lewin's force field analysis model. These internal and external forces are known as the "driving forces" and "restraining forces" (University of Phoenix. (Ed.), 2005, p. 476-477). "The driving forces in the external environment: information technology, globalization, competition, and demographics" will affect the company (University of Phoenix. (Ed.), 2005, p. 476). The COO also needs to look at the internal driving forces "originate from within the organization, such as competition across divisions of the company" (University of Phoenix. (Ed.), 2005, p. 477). Additionally, The COO needs to examine the restraining forces "commonly called “resistance to change” because they appear as employee behaviors that block the change process" (University of Phoenix. (Ed.), 2005, p. 477). Lewin's model notes that a company must "unfreeze the current situation, moving to a desired condition, and refreezing the system so that the change remains in this desired state" (University of Phoenix. (Ed.), 2005, p. 477). As Synergetic Solutions moves forward to meet its objective, the COO will need to address the unfreezing aspects of Lewin's model that will create some turmoil with the company. The COO will also need to determine when the company has changed enough to meets current objectives and refreeze the company to provide stability.

Resistance and Strategies to Manage

In terms of direct cost “people tend to block actions that result in higher direct costs or lower benefits than the existing situation” (University of Phoenix. (Ed.), 2005, p. 479). No one wants to be affected in a negative way by a change in company policy or structure. People will resist if they feel that the results of change will leave them worse off than their current situation. “Some people resist change as a political strategy to ‘prove’ that the decision is wrong or that the person encouraging change is incompetent” (University of Phoenix. (Ed.), 2005, p. 479). This defines another restraining force known as saving face, which has resulted in acts of deliberate sabotage to impede the change process. Negatively affected workers may stop at nothing to prove a change process is not in the best interests of an organization.

Fear of the unknown, when “people resist change because they are worried that they cannot adopt…new behaviors…, increases the risk of personal loss” (University of Phoenix. (Ed.), 2005, p. 479). Restraining forces exist hand-in-hand with the breaking of routines. Employees fear not knowing what to expect. “Employees need to abandon the behavioral routines that are no longer appropriate” (University of Phoenix. (Ed.), 2005, p. 479). When the change agent abruptly removes an employee from a comfortable routine without adequate preparation, the employee may fight to return to that routine. This effect can be magnified in teams. The last restraining force that may be encountered is incongruent team dynamics, which occurs when “teams develop and enforce conformity to a set of norms that guide behavior” (University of Phoenix. (Ed.), 2005, p. 480). In essence, the team is running the organization, or may have created an informal culture that is directing the formal structure.

There are many ways to manage these forces and some strategies are more effective than others. Six specific strategies for managing restraining forces are: “communication, training, employee involvement, stress management, negotiation, and coercion” (University of Phoenix. (Ed.), 2005, p. 481-482). Communication is a must when trying to manage restraining forces. “It reduces the restraining forces by keeping employees informed about what to expect from the change effort” (University of Phoenix. (Ed.), 2005, p. 481). Successful communication breaks down barriers between leadership and employees. Through communication, leadership can inform employees of what the changes may bring, minimizing apprehension while helping to form new productive routines. Training can be an important management strategy for forming new routines and easing fears brought on by the transitional period. “Employee involvement can be an effective way to reduce the restraining forces because it creates a psychological ownership of the decision” (University of Phoenix. (Ed.), 2005, p. 483). Employees that are involved in the decision-making process may be more inclined to adapt to changes since they may feel valued enough to have had input into the change process. Their fears eased, the employees may feel like part of the team.

Change in an organization can be extremely stressful on its employees. By providing employees the means to manage stress, leaders in an organization can manage certain restraining forces. “Stress management minimizes resistance by removing some of the direct costs and fear of the unknown associated with the change process” (University of Phoenix. (Ed.), 2005, p. 484). “People have vested interests and apply their power to ensure that the emerging conditions are consistent with their personal values and needs” (University of Phoenix. (Ed.), 2005, p. 484). Negotiation must be used when dealing with employees that may perceive changes to affect them negatively.

Finally, coercion is the most drastic of all the strategies. Sometimes the only way to bring about change in an organization is to threaten, or literally remove the people who are not going to fit into the culture that the new changes will bring about. All six strategies may be used to effectively manage restraining forces in an organization; however, some strategies should only be used when warranted. “Communication, training, employee involvement, and stress management try to reduce the restraining forces and should be attempted first. Negotiation and coercion are necessary for people who will clearly lose something from the change and when the speed of change is critical (University of Phoenix. (Ed.), 2005, p. 481).

Leadership Styles Can Influence the Change Management Process.

McShane−Von Glinow defines leadership “as the process of influencing people and providing an environment for them to achieve team or organizational objectives” (University of Phoenix. (Ed.), 2005, p. 416). The COO’s leadership style can be an asset or a detriment to the change management process depending on the type of team being managed. The environment a team operates in can also be affected by the style of leadership used. Fred Fiedler developed a contingency model that stated, “According to this model, leader effectiveness depends on whether the person’s natural leadership style is appropriately matched to the situation” (University of Phoenix. (Ed.), 2005, p. 427). Fiedler’s model states that the best leadership style depends on the level of power and influence a manager has over a situation. The following items can affect the situation: leader–member relations, task structure, and positional power.

When an organization is undergoing change a manager must “Make as many people as possible feel as though they are leading the change, rather than having it imposed on them. Give them responsibility for making some of the implementation a success” (Your Route to the Top: Implementing Changes From Above, 2005).

There are four leadership styles a COO may use to help manage change within an organization: directive, supportive, participative and achievement-orientated. Directive leadership sets clear goals, provides the means to reach goals, and sets clear standards to measure employee performance. Directive leadership is balanced when handing out rewards and punitive actions to employee, although, training and experience can replace this type of leadership. Supportive leadership is used to make the work environment enjoyable and is effective during times of change. This style helps employees cope with stressful situations. Cohesive teams can replace supportive leadership by meeting the same need for support. Participative leadership requires a manager capable of encouraging employees to become involved in decisions that affect their work environs. Participative leadership helps the employee feel that he or she is valued and integral to the process of change. The achievement-oriented style encourages employees to reach predefined goals set by the manager. Achievement-orientation applies goal setting theory and positive expectations. Goal setting is used to motivate employees and clearly define the employees’ roles by creating performance objectives. The intended outcome of this theory is to give employees a clear understanding of their roles in the new process so employees’ energies can be focused on improving work performance.

Lessons Learned

The simulation has helped to clarify the transitive nature of change in an organic organization and the extent to which an act of change can affect the whole organization. In the simulation, Lewin’s Force Field Analysis theory of change seems most obvious when reviewing the charge for change placed on the COO by the CEO (University of Phoenix. (Ed.), 2005, p 677). The CEO directed the COO to implement change in the organization, marking the start of the change process described in Lewin’s three classic steps through change: unfreeze, movement, refreeze. The COO received a mission statement from the CEO to unfreeze the organization for change, move through the change within nine months, and reach a goal, at which point in the change cycle the COO can solidify the new organizational structure. In the simulation, the actual change process applied by the COO appears to follow a whole systems approach, which “is based on the notion that any change…has a cascading effect throughout an organization” (University of Phoenix. (Ed.), 2005, p. 679).

The Synergetic Solutions Inc. COO and his leadership staff have shed light on the difficulties and potential rewards of moving from a procedural, mechanistic organization into an organic, self adjusting, ever evolving organization. In concordance with a whole systems perspective on change, the COO and his managerial staff dialogued on the issues and selected a direction for the organization, which exemplifies the procedures in the strategic choice model (University of Phoenix. (Ed.), 2005, p. 660). Avenues to achieve the new target structure and the stages of the transformation process; deciding on the change management approach, either mechanistic or wholes systems, to use in order to affect the change; understanding the internal and external factors promoting the change process; weighing of the internal and external factors influencing the change; diagnosing and managing organizational resistance to change; selecting an effective leadership style to move the organization through change; were weighed from the perspective of the organization’s current environment and decisions were implemented to move the organization to its new structural goal.

The final product of the change process that Synergetic Solutions Inc underwent appears to be an organization-based on Fiedler’s contingency model of design. The contingency model says that organizations “tend to be more effective when they are structured to fit the demands of the situation” (University of Phoenix. (Ed.), 2005, p. 651). The majority of the change procedures discussed and implemented by the COO and his managers appear to be consistent with an organic, whole systems change model, intended to foster an organic organizational structure composed of “flexible networks of multitalented individuals who perform a variety of tasks” (University of Phoenix. (Ed.), 2005, p. 654).

References

Arena, M. J. (2003). Exploring the new sciences through whole scale (TM)

change. Organization Development Journal, 21(1), Retrieved March 19, 2005, from ProQuest database.

Boog, B. W., Keuhne, L., & Tromp C. (2003). Action research and emancipation. Journal

of Community and Applied Social Psychology, 13(6), 419-420. Retrieved March 19, 2005, from EBSCOHost database.

Manning, M. R., & Binzagr, G. F. (1996). Methods, values, and assumptions underlying

large group interventions intended to change whole systems. International Journal of Organizational Analysis, 4(3), Retrieved March 19, 2005, from ProQuest database.

Mellish, L. (1999). Appreciative inquiry. Training Journal, 5. Retrieved March 19, 2005,

from ProQuest database.

Newman, H. L., & Fitzgerald, S. P. (2001). Appreciative inquiry with an executive team:

Moving along the action research continuum. Organization Development Journal, 19(3), Retrieved March 19, 2005, from ProQuest database.

Organization Structure, ORG502 – Human Relations and Organizational Behavior, University of Phoenix, Macromedia Flash Animation Simulation, retrieved March 16, 2005, from https://ecampus.phoenix.edu/secure/resource/vendors/tata/sims/

hrob/hrob_simulation3.html

University of Phoenix. (Ed.). (2005). Organizational behavior, [University of Phoenix

Custom Edition e-text], Boston Pearson Custom Publishing, Retrieved March 14, 2005, from University of Phoenix, eResource, ORG/502 – Organizational Behavior Web site:

Your Route to the Top: Implementing Changes From Above. (2005, February). Management Today, 13. Retrieved March 17, 2005, from Business Source Premier Database.

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