Organizational behavior 4th by MShean chap017

17

Organizational
Change
McGraw-Hill/Irwin

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Organizational Change at Home Depot
Home Depot CEO Robert
Nardelli (left in photo) has
dramatically changed the
big box retailer’s culture
by introducing systems
that reinforce the new
values.

McShane/Von Glinow OB4e

Slide 17-2

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Force Field Analysis Model
Desired
Conditions

Restraining
Forces

Restraining
Forces

Current
Conditions

Driving
Forces

Restraining
Forces

Driving
Forces
Driving
Forces

Before
Change
McShane/Von Glinow OB4e

During
Change
Slide 17-3

After
Change

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Resistance to Change
Direct Costs
Saving Face

Forces for
Change

Fear of the Unknown
Breaking Routines
Incongruent Systems
Incongruent Team Dynamics

McShane/Von Glinow OB4e

Slide 17-4

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Resisting Change at the FBI
The FBI has been slow to shift from
law enforcement to domestic
intelligence due to:
– Incongruent systems -- career
paths, reward system,
decentralized structure
– Breaking routines -- unfamiliar
with intelligence gathering roles

– Saving face -- past turf wars with
CIA created an anti-investigation
mindset

McShane/Von Glinow OB4e

Slide 17-5

AP/ Wide World Photos

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Creating an Urgency for Change
• Inform employees about driving forces
• Most difficult when organization is doing well
• Must be real, not contrived
• Customer-driven change
– Adverse consequences for firm
– Human element energizes employees

McShane/Von Glinow OB4e

Slide 17-6

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance at Nissan

© Eriko Sugita/Reuters/Corbis

Carlos Ghosn launched a turnaround at Nissan Motor Company
that saved the Japanese automaker and relied on change
management practices rarely seen in Japan. Employee
involvement was a key strategy to minimize resistance to the
turbulent changes that occurred.

McShane/Von Glinow OB4e

Slide 17-7

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication

 Highest priority and first
strategy for change
 Improves urgency to change
 Reduces uncertainty (fear of
unknown)
 Problems -- time consuming
and costly

McShane/Von Glinow OB4e

Slide 17-8

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication
Learning

McShane/Von Glinow OB4e

 Provides new knowledge
and skills
 Includes coaching and
action learning
 Helps break old routines and
adopt new roles
 Problems -- potentially time
consuming and costly

Slide 17-9

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication
Learning
Employee
Involvement

 Increases ownership of

change
 Helps saving face and
reducing fear of unknown
 Includes task forces, future
search events
 Problems -- time-consuming,
potential conflict

McShane/Von Glinow OB4e

Slide 17-10

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication
Learning
Employee
Involvement
Stress
Management

 When communication,
training, and involvement do
not resolve stress
 Potential benefits
 More motivation to change
 Less fear of unknown
 Fewer direct costs

 Problems -- time-consuming,
expensive, doesn’t help
everyone

McShane/Von Glinow OB4e

Slide 17-11

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication
Learning
Employee
Involvement
Stress
Management
Negotiation

 When people clearly lose
something and won’t
otherwise support change
 Influence by exchange-reduces direct costs
 Problems
• Expensive
• Gains compliance, not

commitment

McShane/Von Glinow OB4e

Slide 17-12

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Minimizing Resistance to Change
Communication
Learning
Employee
Involvement
Stress
Management
Negotiation
Coercion

McShane/Von Glinow OB4e

 When all else fails
 Assertive influence
 Firing people -- radical
form of “unlearning”
 Problems
• Reduces trust
• May create more subtle

resistance

Slide 17-13

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Refreezing the Desired Conditions
• Realigning organizational systems and
team dynamics with the desired changes
– Alter rewards to reinforce new behaviors
– Feedback systems
• Help employees learn how they are doing
• Provide support for the new behavior patterns

McShane/Von Glinow OB4e

Slide 17-14

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Strategic Vision & Change
Need a vision of the desired future state
Identifies critical success factors for change
Minimizes employee fear of the unknown
Clarifies role perceptions

McShane/Von Glinow OB4e

Slide 17-15

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Change Agents
• Change agents apply transformational leadership
– Help develop a vision
– Communicate the vision
– Act consistently with the vision
– Build commitment to the vision

• Also apply transactional leadership
– Aligning employee behavior through rewards,
resources, feedback ,etc.

McShane/Von Glinow OB4e

Slide 17-16

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Diffusing Change with MARS Model
• Motivation
– Successful pilot project
– Supervisor support and reinforcement

• Ability
– Competencies to adopt pilot project
– Role modeling from people in pilot project

• Role perceptions
– Translating pilot project practices -- neither too specific
nor too general

• Situational factors
– Resources and time to implement pilot project elsewhere

McShane/Von Glinow OB4e

Slide 17-17

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Action Research Approach
• Change needs both action and research
focus
• Action orientation
– Solve problems and change the
organizational system

• Research orientation
– Concepts guide the change
– Data needed to diagnose problem, identify
intervention, evaluate change

McShane/Von Glinow OB4e

Slide 17-18

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Action Research Process
Establish
ClientConsultant
Relations

Diagnose
Need for
Change

Introduce
Intervention

Evaluate/
Stabilize
Change
Disengage
Consultant’s
Services

McShane/Von Glinow OB4e

Slide 17-19

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Appreciative Inquiry at Canadian Tire

Canadian Tire relied on appreciative inquiry by asking staff to
describe events that have made the retailer successful. The
company’s core values were then rebuilt around those positive
experiences. Store employees were also involved in an
appreciative inquiry exercise to reinforce these values.

McShane/Von Glinow OB4e

Slide 17-20

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Appreciative Inquiry Approach

 Directs participants’ attention away from problems and
towards the group’s potential and positive elements.
 Reframes relationships around the positive rather than
being problem oriented

McShane/Von Glinow OB4e

Slide 17-21

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Four-D Model of Appreciative Inquiry
Discovery

Discovery

Dreaming
Dreaming

Designing
Designing

Delivering
Delivering

Discovering
Discovering
the
the best
best of
of
“what
“what is
is

Forming
Forming
ideas
ideas about
about
“what
“what might
might
be”

be”

Engaging
Engaging in
in
dialogue
dialogue
about
about “what
“what
should
should be”
be”

Developing
Developing
objectives
objectives
about
about “what
“what
will
will be”
be”

McShane/Von Glinow OB4e

Slide 17-22

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Parallel Learning Structure Approach
• Highly participative social structures
• Members representative across the formal
hierarchy
• Sufficiently free from firm’s constraints
• Develop solutions for organizational change
which are then applied back into the larger
organization

McShane/Von Glinow OB4e

Slide 17-23

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.


Parallel Learning Structures
Parallel
Structure

McShane/Von Glinow OB4e

Organization

Slide 17-24

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.

Cross-Cultural and Ethical Concerns
• Cross-Cultural Concerns
– Linear and open conflict assumptions different
from values in some cultures

• Ethical Concerns
– Privacy rights of individuals
– Management power
– Individuals’ self-esteem
– Consultant’s role

McShane/Von Glinow OB4e

Slide 17-25

© 2008 The McGraw-Hill Companies, Inc. All rights reserved.