Refer to Pages 386–408.

15.1: Describe the forces driving organizational change.

Refer to Page 387.

There are numerous forces for change in organizations. For example, the impact of workforce diversity due to gender, race/ethnicity, and generations at work. Changes in the workforce as well as cultural differences will continue to be a force for organizational change. The economy represents a significant source for change. For example, the economic recession resulted in major changes such as downsizing and restructuring. Technology changes are rapid, and organizations must keep up with these advances. Technology advances have resulted in e-mail now being the primary mode of organizational communication, and handheld devices are now commonly used by employees. Globalization represents a significant source of change for organizations with the rise of the multinational corporation. Increased globalization of markets has also given rise to global competition in addition to competing with firms within a given country.

15.2: Explain why planned organizational change is necessary.

Refer to Page 388.

The forces for organizational change have resulted in the need for organizations to be proactive rather than reactive in reading the environment they operate in. The idea of being proactive when it comes to change is not new and dates to the classic management book Overcoming Organizational Defenses. Yet most organizations still are in reactive mode (i.e., “putting out fires”) when it comes to change. Change may also be incremental (e.g., adding blue dots to a detergent) or radical (e.g., a major restructuring). The most intense form of change is proactive and radical, and it is often when an organization engages in planned organizational change using OD interventions.

15.3: Compare and contrast the four subsystems involved in planned organizational change.

Refer to Page 390.

Planned organizational change involves four organizational subsystems:

(1) Formal organization. This provides the coordination and control necessary for organized activity; examples are formal structures and reward systems. (2) Social factors. These factors include individual differences, team interactions, and the organizational culture. (3) Technology. This is how raw materials and inputs transform into outputs, such as work flow design and job design. (4) Physical setting. These are the characteristics of the physical space and how it is arranged.

15.4: Provide an example of an organizational development (OD) intervention.

Refer to Page 391.

Organizational development (OD) is a collection of social psychology methods employed to improve organizational effectiveness and employee well-being. OB can be considered to be the theory and research that underlies the practical application of OD interventions in the workplace. Workout was pioneered at General Electric (GE) and provided a method for employees to get new ideas head by top management without having to go through hierarchical levels of bureaucracy. Sometimes a leader needs an outside point of view on an organizational issue and hires a consultant with OD expertise who assists in a helping mode. This process is called process consultation and may focus on such matters as interpersonal relationships and communication. Organizations are increasingly relying on teams to work on complex tasks and generate new ideas. Thus, team building has emerged as an important OD intervention. Team building employs group activities that involve a great deal of interaction among team members to increase trust. Appreciative inquiry (AI) is a recently developed OD intervention that is an example of action research. The basic assumption is that people move in the direction that they visualize for the future.

15.5: Discuss the reasons why people resist organizational change.

Refer to Page 393.

Resistance means that the employees fight the change and try to undermine it. Research has revealed employees resist changes in their work methods due to resentment, frustration, and a loss of hope of regaining their formal levels of proficiency. Lack of participation and input to the change is one reason employees resist change. There are a number of others that include both personal reasons and organizational reasons. Personal reasons include habit, security, economic, and fear of the unknown. Organizational reasons for resistance are structural inertia (the structure is too rigid to support the change), group inertia, threats to expertise, and threats to established power relationships.

15.6: Compare and contrast the models for leading organizational change (i.e., Lewin, Kotter).

Refer to Page 396.

Lewin’s is a three-step model for understanding the fundamental process of leading change. There are three steps in the change process: unfreezing, changing, and refreezing. First, unfreezing challenges the status quo by shaking up assumptions; next, changing represents movement toward a new desired state. Finally, refreezing the changes by reinforcing and restructuring is the third phase to make the changes permanent. Another important model for leading change is the Kotter eight-step model. (1) Establish a sense of urgency. Change typically begins with leaders noticing challenges the organization faces. (2) Form a powerful guiding coalition. Change efforts may start with just one or two people who begin to convince others that change is needed. (3) Create a vision. A compelling “picture” of the future must be created. (4) Communicate the vision. Regardless of how much communication leaders think is needed, they should multiply that by 10. (5) Empower others to act on the vision. Employees should be allowed to participate in making changes in their areas. (6) Plan for and create short-term wins. Change takes time, and change efforts sometimes lose momentum as frustrations set in with employees. (7) Consolidate improvements and sustain the momentum for change. A change process can take 5 to 10 years—as force field analysis shows, the forces against change such as resistance may result in regression to the prior ways of doing things. (8) Institutionalize the new approaches. A leader will know that the change is frozen in place when followers believe that it is “the way we do things around here.”

15.7: Discuss the role of executive leadership in implementing successful organizational change.

Refer to Page 399.

Research has shown that executive leadership—top management support—is important during organizational change. A meta-analysis found little or no commitment to change from employees when top management support for change was low. This is important because employee attitudes have also been shown to influence the success of organizational change. One key attitude is commitment to change.