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CHANGE MANAGEMENT

HRM 604 - EMBA 2K17


Dr. Muhammad Naseer Akhtar

LECTURE 01
LEARNING OBJECTIVES
What is Change
What is Change Management?
The Trap of Success
Megatrends that derive Change
Recognizing the need for change and starting the change process
RECOGNISING THE NEED FOR CHANGE AND
STARTING THE CHANGE PROCESS
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3RD EDITION, JOHN HAYES, PALGRAVE, 2010 3
RECOGNISING THE NEED FOR CHANGE

Managers may fail to recognise the need for change because they pay
insufficient attention to the wider environment
or
fail to recognise the implications of what is happening around them

THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3RD EDITION, JOHN HAYES, PALGRAVE, 2010 4
Prolonged
The trap of success
(Adapted from Nadler & Shaw 1995)

period of
success
Outcomes Environmental
Disturbance
Decreased
Success customer focus Declining
Syndrome Learning Poor external performance
Increased Cost
Complacency
disabled alignment

(feeling satisfied) Less innovation

Arrogance

Internal focus

Death spiral

Do
Denial
more of &
the rationalisation
same

THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3RD EDITION, JOHN HAYES, PALGRAVE, 2010
5
FALLING APPLE
There are fears it could be the beginning of the end for Apple's
outperformance too. Most recently, Apple fell into bear market
territory for the first time in several years this month. But Apple
shares also saw a significant dip when the group announced its
results in mid-July.
On the face of it, this is slightly baffling. Its results were still well
within its guidance. Certainly, the company missed projections for
revenue forecasts and its iPhone sales were not as strong, but it is
still predicting £1bn in sales for the Apple Watch.
Part of the problem is that Apple has been exceeding expectations
for so long, an expectation that it will beat them all is now baked
into the share price. One analyst suggested Apple shareholders had
become 'spoilt' by the company constantly beating estimates. We
believe it probably is the end of Apple's outperformance.
While there is good new user conversion within the US, outside the
US, it is mostly a replacement cycle. In China, for example, Apple
has been successful at getting the high end of the market, but we
are sceptical about the extent to which it will make inroads further
down the value chain. It has strong competitors in Xiaomi, a privately
owned Chinese electronics company, and others.
INNOVATION
FROM MANUAL WORK TO KNOWLEDGE WORK
0% 20% 40% 60% 80% 100%

1900 17 83

1930 30 70

1970 49 51

2000 62 38

2020 75 25

knowledge work manual work

Source: Zukunftsinstitut (2008)


DEMOGRAPHY
50%

40% 25-34 35-49

50-64 65+
30%

20%

10%

0%
2010 2015 2020 2025 2030 2035

-10%

-20%

-30%
GLOBALIZATION
GLOBAL TRADE DEVELOPMENT
WEB 2.0 – USER-GENERATED CONTENT

Web 1.0 Web 2.0


VALUE CHANGE
VALUE CHANGE

Old values: compliance, New values: discipline,


control, contract and constraint support, trust and stretch

Successful change involves simplification, integration, and regeneration


WHAT IS ORGANIZATIONAL CHANGE?
An alteration of an organization’s environment, structure, culture,
technology, or people
A constant force
An organizational reality
An opportunity or a threat
Change agent
A person who initiates and assumes the responsibility for
managing a change in an organization
BASIC QUESTIONS FOR CHANGE AGENTS

What are the forces acting upon me?


What are the pressures I should take into consideration as I
decide what to change and how I should change it?
What should we change?
Should the changes be strategic and companywide or relatively
limited?
How should we change it?
How should we actually implement the change?
FORCES FOR CHANGE

External Forces External Forces


Competition Laws and regulations Strategy modifications
New technologies New equipment

Labor market shifts New processes


Workforce composition
Business cycles
Job restructuring
Social change
Compensation and benefits
Labor surpluses and shortages
Employee attitude
THREE CATEGORIES OF CHANGE

ORGANIZATIONAL CULTURE
MODEL FOR PLANNED ORGANIZATIONAL CHANGE

Source: Adapted from Larry Short, “Planned Organizational Change,” MSU Business Topics, Autumn 1973,
pp. 53–61 ed. Theodore Herbert, Organizational Behavior: Readings and Cases (New York: McMillan, 1976), p. 351.
TWO VIEWS OF THE CHANGE PROCESS

“Calm waters” metaphor


A description of traditional practices in and theories about
organizations that likens the organization to a large ship making
a predictable trip across a calm sea and experiencing an
occasional storm
“White-water rapids” metaphor
A description of the organization as a small raft navigating a
raging river
CHANGE IN “CALM WATERS”
Kurt Lewin’s Three-Step Process
Unfreezing
The driving forces, which direct behavior away from the status
quo, can be increased
The restraining forces, which hinder movement from the existing
equilibrium, can be decreased
The two approaches can be combined
Implementation of change
Refreezing
CHANGE IN “WHITE-WATER RAPIDS”

Change is constant in a dynamic environment


The only certainty is continuing uncertainty
Competitive advantages do not last
Managers must quickly and properly react to unexpected events
Be alert to problems and opportunities
Become change agents in stimulating, implementing and
supporting change in the organization
IS A NEW STRUCTURE REALLY REQUIRED?

When you identify a problem with


your design, first look for ways to fix it
without substantially altering it. If that
doesn’t work, you’ll have to make
fundamental changes or even reject
the design. Here’s a step-by-step
process for resolving problems.
Source: Adapted from Michael Goold and Andrew Campbell, “Do You Have a Well-
Designed Organization?” Harvard Business Review, March 2002, p. 124.
IS A NEW STRUCTURE REALLY REQUIRED?
(CONT’D)
A NINE-STEP PROCESS FOR LEADING
ORGANIZATIONAL CHANGE
1. Create a Sense of Urgency 6. Generate Short-Term Wins
2. Decide What to Change 7. Consolidate Gains and
Produce More Change
3. Create a Guiding Coalition and
Mobilize Commitment 8. Anchor the New Ways of
Doing Things in the Company
4. Develop and Communicate a Culture
Shared Vision
9. Monitor Progress and Adjust
5. Empower Employees to Make the Vision as Required
the Change
WHY PEOPLE RESIST CHANGE
HOW IMMUNE IS THE PERSON TO CHANGE?

Source: Robert Kegan and Lisa Lahey, “The Real Reason People Won’t
Change,” Harvard Business Review, November 2001, p. 89.
DEALING WITH CHANGE
KEY STEPS IN CHANGE PROCESS
1- recognizing the need for change and starting the change
process
2- diagnosing what needs to be changed and formulating a
vision of a preferred future state
3- planning how to intervene in order to achieve the desired
change
4- implementing plans and reviewing progress
5- sustaining the change
6- leading and managing the people issues
7- learning

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