CHANGE AND ITS EFFECTS

Pain is a fundamental driver of change . . . Seize the moment

when pain exists because when pain goes away, so does the
motivation and energy for change associated with it.

Craig M. Macallester
What is Change ?
 Change is any alteration occurring in the work
environment that affects the ways in which employees
must act. These changes may be planned or unplanned,
catastrophic or evolutionary, positive or negative, strong
or weak, slow or rapid, and stimulated either internally
or externally. Regardless of their source, nature, origin,
pace, or strength, changes can have profound effects on
their recipients.

Organizational Change
 Any alterations in the people, structure, or technology of
an organization
Characteristics of Change
 Is constant yet varies in degree and direction
 Produces uncertainty yet is not completely
unpredictable
 Creates both threats and opportunities

Managing change is an integral part of every manager’s

job.
 Forces for Change

External forces Internal Forces

 Marketplace  Changes in
organizational strategy
 Governmental laws and
regulations
 Technology  Workforce changes
 Labor market  New equipment
 Economic changes  Employee attitude
 The Manager as Change Agent

Change Agents

 People who act as catalysts and assume the

responsibility for changing process are called change
agents.

Type of Change Agents

 Managers: internal entrepreneurs

 Nonmanagers: change specialists
 Outside consultants: change implementation experts
 Change Process Viewpoints
The Calm Waters Metaphor
 Lewin’s description of the change process as a break in
the organization’s equilibrium state
 Unfreezing the status quo
 Changing to a new state
 Refreezing to make the change permanent

White-Water Rapids Metaphor

 The lack of environmental stability and predictability
requires that managers and organizations continually
adapt (manage change actively) to survive.
 Types of Change
Structural
 Changing the organization’s structure or its structural
components
Technological
 Adopting new equipment or operating methods that
displace old skills and require new ones
Automation
 Replacing certain tasks done by people with machines
Workforce
 Changing attitudes, expectations, perceptions, and
behaviors of the workforce
 Managing Resistance to Change

Why People Resist Change ?

 The ambiguity and uncertainty that change
introduces
 The comfort of old habits
 A concern over personal loss of status, money,
authority, friendships, and personal convenience
 The perception that change is incompatible with the
goals and interest of the organization
Issues in Managing Change (cont’d)

Changing Organizational Culture

Cultures are naturally resistant to change
Conditions that facilitate cultural change:
The occurrence of a dramatic crisis
Leadership changing hands
A young, flexible, and small organization
A weak organizational culture
Issues in Managing Change (cont’d)
Handling Employee Stress due to Change
 Stress
The physical and psychological tension an individual
feels when confronted with extraordinary demands,
constraints, or opportunities and their associated
importance and uncertainties.
Functional Stress
- Stress that has a positive effect on performance

 How Potential Stress Becomes Actual Stress

There is uncertainty over the outcome
When the outcome is important
Issues in Managing Change (cont’d)
Reducing Stress
 Engage in proper employee selection
 Match employees’ KSA’s to jobs TDR’s
 Use realistic job interviews for reduce ambiguity
 Improve organizational communication
 Develop a performance planning program
 Use job redesign
 Provide a counseling program
 Offer time planning management assistance
 Sponsor wellness programs
 Issues in Managing Change (cont’d)

Making Change Happen Successfully

 Embrace change – become a change-capable
organization
 Create a simple, compelling message explaining why
change is necessary
 Communicate constantly and honestly
 Foster as much employee participation as possible-get
all employees committed
 Encourage employees to be flexible
 Remove those who resist and cannot be changed
 Stimulating Innovation

Creativity
The ability to combine ideas in a unique way
or to make an unusual association

Innovation
Turning the outcomes of the creativity process
into useful products, services or work
methods
Creating the “Right” Environment for
Innovation

Structural Variables
 Adopt an organic structure
 Make available plentiful resources
 Engage in frequent inter unit communication
 Minimize extreme time pressures on creative activities
 Provide explicit support for creativity
Creating the “Right” Environment for
Innovation (cont’d)
Cultural Variables
 Accept ambiguity
 Tolerate the impractical
 Have low external controls
 Tolerate risk taking
 Tolerate conflict
 Focus on ends rather than means
 Develop an open-system focus
 Provide positive feedback
Creating the “Right” Environment for
Innovation (cont’d)

Human Resource Variables

 Actively promote training and development to keep
employees’ skills current
 Offer high job security to encourage risk taking
 Encourage individual to be “champions” of change
 Parallel Stages of Reactions to Terminal
Illness and Organizational Change

Reactions to Terminal Illness Reactions to Major Change

1. Denial 1. Refusal to believe it is real
2. Anger 2. Resentment at change initiator
3. Depression 3. Emotional or physical withdrawal
4. Search for alternatives 4. Exploration of benefits
5. Acceptance of prognosis 5. Embracing of the change
Types of Resistance to Change among
Employees
 Logical Resistance. This is based on disagreement with the
facts, rational reasoning, logic and science. Logical resistance
arises from the actual time and effort required to adjust to
change, including new job duties that must be learned.

 Logical, Rational Objections:

 Time required to adjust
 Extra effort to relearn
 Possibility of les desirable, conditions, such as skill
downgrading
 Economic costs of change
 Questioned technical feasibility of change
 Types of Resistance to Change among
Employees (cont’d)
 Psychological Resistance. This is typically based on emotions,
sentiments, and attitudes. Psychological resistance is internally
logical from the perspective of the employees’ attitudes and
feelings about change.

 Psychological, Emotional Attitudes:

 Fear of the unknown
 Low tolerance of change
 Dislike of management or other change agent
 Lack of trust in others
 Need for security; desire for status quo
Types of Resistance to Change among
Employees (cont’d)
 Sociological Resistance. Sociological resistance also is logical,
when it is seen as a product of a challenge to group interests,
norms, and values.

 Sociological Factors, Group Interests:

 Political coalitions
 Opposing group values
 Parochial, narrow outlook
 Vested interests
 Desire to retain existing friendships
 Building Support for Change
 Use of Group Force. Effective change focuses not only
on the individuals but also on the group itself. The
group is an instrument for bringing strong pressure on
its members to change.

 Providing a Rationale for Change. Capable

leadership reinforces a climate of psychological
support for change. The effective leader presents
change on the basis of the impersonal requirements of
the situation-objective (performance-related) reasons
for the change-rather than on personal grounds.
 Building Support for Change (cont’d)

 Participation. A fundamental way to build support for

change is through participation.

 Shared Rewards. Another way to build employee

support for change is to ensure sufficient rewards for
employees in the change situation.

 Employee Security. Along with shared rewards,

exiting employee benefits need to be protected.
Security during a change is essential.
 Building Support for Change (cont’d)
 Communication and Education. Communication is
essential in gaining support for change. Even though a
change will affect only one or two in a work group of tem
persons, all of them need to be informed clearly and
regularly about the change in order to feel secure and to
maintain group cooperation.

 Stimulating Employee Readiness. Closely related to

communication is the idea of helping employees become
aware of the need for a change. This approach builds on
the premise that change is more likely to be accepted if the
people affected by it recognize a need for it before it
occurs.
 Building Support for Change (cont’d)

 Working with the Total System. Resistance to change

can be reduced by a broader understanding of
employee attitudes and natural reactions to change.
Management’s role is to help employees recognize the
need for each change and to invite them to participate
in it and gain from it.