Chapter 16: Organizational Change, Development
and Innovation 04/13/2014
The Concept of Organizational Change
Changes that are implemented & managed that is crucial to cust
and members
Why Organizations Change
Pressure to change: External & Internal sources
External envt:
oIncreased competitiveness of biz by global economy,
deregulation & adv technology biz becomes leaner and
meaner
oRemove layers of middle managers, develop +atter
structures that are more responsive to competitive dd
oMerger, acquisitions and joint ventures with foreign firm
Internal envt:
oLow productivity, conflict, strikes, sabotage, high
absenteeism and turnover signal that change is
necessary
oEmployee opinion
oInternal forces for change occur in response to org changes
that are designed to deal with the external envt mergers
and acquisitions to bolster competitiveness have been
followed by cultural conflict, which further stimulates
changes that were not anticipated at time of merger
1. When threat is perceived, org “unfreeze”, scan the envt for
solutions and use the threat as a motivator for change
2. Org can be paralyzed by threat, behave rigidly & exhibit extreme
inertia
Change:
o1. Entails investment of resources
o2. Requires modi0cation of routines & processes
oIf either missing inertia!
Int & ext envt will be dynamic
oOrg should differ in the amount of change they display
oOrg in dynamic envt show more change to be effective
than those on stable envt
oOrg can exhibit too much change or too little
oCompany in constant +ux fails to establish regular patterns
of OB necessary for effectiveness employees become
cynical abt mgmt.
oStudy shows: most CEO saw org as poor at executing
change
What Org Can Change
7 Factors:
1. Goals & Strategies
org freq change their goals & strategies
expansion, intro new products, pursue new market
2. Technology
vary from minor to major
intro of online portal access for employees fairly minor
assembly line to +ex manufacturing major
3. Job Design
include more variety, autonomy, identity, signiticance, feedback
4. Structure
modi0ed from function to product form (vice versa)
formalization, centralization, tallness, spans of control,
networking with other firm can be manipulated
modi0cation in rules, policies, procedures
5. Processes
basic process can be changed
6. Culture
main reason reported for the failure of organizational change
programs is the failure to change an organizational culture
organization culture provides org’s competitive advantage &
long-term effectiveness, changing it is considered fundamental
aspect of org change
7. People
actual content of membership can be changed through revised
hiring processes
ointro new blood / take adv of the diverse labour pool
existing membership changed in terms of skills & attitudes by
various training & dev methods
Things to note:
1. Change in one area calls for change in others
failure to recognize this systematic change can lead to severe
