Change refers to a strategic change in an organization’s structures, systems, culture, managerial approach and technology.

Strategy is the direction and scope of an organization over the long term ideally which matches its resources to its changing

environment in particular its markets, customers or clients so as to meet stakeholders expectations.

Environmental, Cultural and Political Influences and their Implications for Change

Environmental, Cultural and Political Influences and their Implications for Change

Implementation and Impact of Change

Implementation and Impact of Change

1. Resistance from senior managers2. Dominant Culture3. Conflicts due to Transformational change4. Resistance due to organizational routines and ideological

objectionsORGANISATIONAL PREREQUISITES:1. Senior management commitment2. Equipping mangers for change 3. Documentation4. Maintaining Open communication 5. Training participants6. Shared awareness7. Assembling a body of KEY managers8. Facilitate necessary resources9. Acceptance

Role of HR strategies in implementing changeRole of HR strategies in implementing change

• Proper Planning• Designing and Management of Personnel

systems • Matching HRM to explicit business strategy• People as a strategic resource

WHAT DOES CHANGE MEAN?An organisational Change is defined as the adoption of a new idea or

behaviour by an organisation. It is a way of altering an existing organisation to increase organl effectiveness for achieving its objectives.. OC is structural in character and aims at bringing about the structural changes.

Response to change depends upon the employees perception about the change.

Theories of changeEvolutionary change- continuous cycle of change. Outcome can be radical or

gradual.Dialectic theory- organisational existence in pluralistic world of ambiguous &

contradictory forces that compete with one another.Life cycle theory- change process as a linear irreversible sequence of

prescribed stages which facilitate an orga. To move to the desired stage.

• Teleological theory- talks abt. The orgas. Interaction with the external n internal construct n its efforts to reach the goal. It’s a deliberate process of reaching the predetermined goal as the ultimate objective.

WHAT DOES CHANGE MEAN?

• Typically, the concept of organizational change is in regard to organization-wide change, as opposed to smaller changes such as adding a new person, modifying a program, etc.

• Examples of organization-wide change might include a change in mission, restructuring operations (e.g., restructuring to self-managed teams, layoffs, etc.), new technologies, mergers, major collaborations, "rightsizing", new programs such as Total Quality Management, re-engineering, etc.

• Some experts refer to organizational transformation. Often this term designates a fundamental and radical reorientation in the way the organization operates.

There are two types of change that challenge and impact organizations

� Internal—structured shifts or programs that are an ongoing phenomenon within an organization. These changes may be undertaken to avoid deterioration of current performance or to improve future performance of a process or system. In this sense they are controlled and managed from within the organization in an orderly, planned, and systematic way

� External—environmental changes that come from outside the organization, and the organization exercises little or no control over them. In business, this could mean shifting economic tides, new competitors, or radical technology developments. In government, it can mean changes in the world situation, the administration, legislation, budgetary issues, or management reform.

Managing Change: where they come from?`

• 1.Management as a control• 2.Management as shaping• CHANGE OUTCOMES• a) intended change outcomes• b) partially intended change outcomes• c) Unintended change outcomes

ROLE OF CHANGE MANAGERS

• 1) Change manager as Director• 2) Change manager as Navigator• Control is still seen. Intended outcome will be achieved.• Outcomes are partly emergent rather completely planned.• Cross functional teams- history of distrust etc. navigating the

process may not be intentional.

• 3) Change manager as Caretaker• A control process, but influenced by many forces. Despite

the Change agents intentions to initiate a process, ppl may think it as a failing one.

• In this case inexorable growth and the issue are outside the control of any manager. This is pessimistic image.

• 4) Change manager as Coach• Assumption is that change managers are able to intentionally

shape the organisation’s capabilities. Coach may rely upon building the right set of values, skills etc.

• 5) Change manager as Interpreter• Creates meaning for the others. Helps them to make sense. It

is in essence constitute a changed orga. Competing interests may be present.

• Change agents provide legitimate arguments.

• E.g. downsizing’s interpretation.

• 6) Change manager as Nurturer• This image assumes that even a small change may have

large significance and managers may not control the outcomes of such changes.

• They may nurture, facilitate organisational qualities to enable a positive self organising to occur.

• The future outcomes are nurtured/ shaped but the ability to produce the intended outcomes is restricted due to forces, chaotic forces.

• Specific outcomes and directions of change cannot be intentionally produced but they emerge and are shaped thru the qualities and capabilities of orga.

Hewlett-PACKARD CHANGE STORY* In 2001 HP AND COMPAQ’S merger was proposed.

• Walter Hewitt-son of founder of HP opposed the merger. And filed a lawsuit.• The Dutch Bank-a stakeholder voted yes for the merger.

• On March 19,2002, the merger was approved.

PRE-MERGER STORY:*In 1999 PC Division faced growing competition from Dell and Sun

Microsystems.*HP was losing market share, sales force needed better coordination etc.

*The CEO wanted to change the HP culture.*To achieve this, it was decided :-

*to work with ad agencies and head of HR to create a set of rules from the garbage, that outlined what HP culture would become.

*Customer defines a job well done.*Invent different ways of working.• Restructuring the company.

•

Contd.

POST MERGER*During the merger there was a lawsuit that led to opposition.*The integration of two cultures led to strained relations between the two

groups. Staff questioned the merits of mergers.*The transition was made bit easier by adding 65000 new personnel to the

HP community.*CEO embarked on a series of technological symposiums and coffee talks

with HP engineers.*Although many employees were not convinced of the HP’s riskiest move

and became the victims of the job cuts.*To win over 1,47,000 employees worldwide CEO used methods like

management by walking around style within the organization.*Unfortunately the HP faced severe competition from Dell and IBM and in

Feb,2005 the CEO was sacked.

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SOME MISTAKES…IN NUTSHELL

*Although the CEO could win the confidence of Dutch bank, she was aware that change involves different interests that need to be identified and managed.

*Customer pressures made the CEO to go for front end and back end sections.

*At HP the merger established a new culture.*CEO faced resistance at both the family level and at the staff level.*The CEO employed two styles: a) to get the merger formalized and

b)sell it to staff.*The change was not properly diagnosed by the CEO. She was under

the pressure to change but not very clear as to what to change.

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SOME LESSONS….?*Different interests need to be recognized and addressed during the

change.*these interests are likely to provoke different reactions.*organisational politics and lobbying are common aspects and they

need to be managed.*negotiations and persuasions are the key communication skills.* Communications should touch the concerned people.*communicating change often entails providing vision of the future.*pressures to change often come from both inside and outside.*restructuring is a common organisational change when confronted

with problems.*any organisational change involves paying attention to

organisational culture.

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KODAK’S CHANGE STORY

• After more than a century of producing traditional film cameras, Kodak announced in September 2003 that it would cut this line of production.

• In western countries, this involves the complete move away from traditional products within the film industry by the end of 2004 and a full scale launch of digital technology.

• This move is slated to generate $ 16 billion revenue by 2006 and $20 billion by 2010.

• CEO David A. Carp announced that Kodak is more competitive, growing profitably, have balanced earning stream and lower cost structure.

• Implementing this change would require Kodak to cut their dividend and to raise capital for new technology purchase.

• This strategy helped in saving $800 million and $1 billion by 2007.

• Kodak needed to make 2 physical changes to the organization-a. there would be a reduction in the Kodak facilities worldwide by consolidating current operations and divesting unnecessary assets.

• B. Kodak intended to reduce employment worldwide with up to 15,000 jobs to cut by 2007.

• Investor Reactions:• The announcement in 2003 took many external experts by

surprise and their reactions were not supportive particularly to the news that their dividends would be cut.

They were aware of the promises to increase the company’s revenue which was not realized.

It was feared that this would become another half-hearted transition as with the $1 billion launch into APS cameras in 1996 ended in failure.

They also pointed out to the risk of moving in this direction as there were rival like HP, Canon Inc., and Seiko Epson Corp. which were already ahead in digital technologies.

But CEO’s response was firm. Staff reactions For many of the Kodak’s employees future looked bleak. They were concerned about loosing their jobs in the light of

proposed 20% worldwide cutbacks. Downsizing is not new in Kodak. From 1997 to 2003 the co.

reduced the workforce by 30,000.

• One union representative explained that the stress on workers in Kodak has been worsened than necessary because management has not reassured that they have got any long term future.

Some lessons: Organisational change involves handling reaction

of both internal and external stakeholders. Communication strategies need to be designed for

internal and external groups Reactions to change are likely to be influenced by

the success of previous changes and the extent to which there has been delivery on past promises.

Change invokes risk and uncertainty The consequences of change cannot always be

predicted Managers of change need to address the question

for staff” how will I be affected?”