dr. roy philip conflict and change management night 1

DR. ROY PHILIP

Conflict and Change ManagementNight 1

Change is accelerating

Power shifting from sellers to buyers

The power of the Internet

Unlimited substitution over competition

Leadership and management domain is worldwide now

Knowledge age

New world

Rapidly Changing World

Allowing Too Much Complacency

Failing to Create Sufficiently Powerful Guiding Coalition

Understanding the Power of Vision

Undercommunicating the Vision by a Factor of 10 (or 100, or even 1,000)

Permitting Obstacles to Block the New Vision

Failure to Create Short-Term Wins

Declaring Victory Too Soon

Neglecting to Anchor Changes Firmly in the Corporate Culture

Why Firms Fail

Consequences of Errors

New Strategies aren’t implemented well

Acquisitions don’t achieve expected synergies

Reengineering takes too long and costs too much

Downsizing doesn’t get costs under control

Quality programs don’t deliver hoped-for-results

McGraw-Hill/Irwin ©2006 The McGraw-Hill Companies, Inc. All rights reserved.

Technological Change

• Faster and better communication•Faster and better transportation•More information networks connecting people globally

Forces driving the need for major change



International Economic

Integration


• Fewer tariffs (GATT)•Currencies linked via floating exchange rates•More global capital flows





Integration

Maturation of markets in developed countries



• Slower domestic growth•More aggressive exporters•More deregulation





Integration

Maturation of markets in developed countries

Fall of communist and

socialist regimes



• Slower domestic growth•More aggressive exporters•More deregulation

•More countries linked to the capitalist system•More privatization




The Globalization of Markets and Competition

More Hazards

• More competition• Increased speed

More Opportunities

• Bigger markets• Fewer barriers

More Large-scale change in organizations

To avoid hazards and/or capitalize on opportunities, firms must become stronger competitors. Typical transformation methods include:

• Reengineering Mergers and acquisitions

• Restructuring Strategic change• Quality programs Cultural change

Establishing a Sense of UrgencyEstablishing a Sense of Urgency

Creating the Guiding Coalition Creating the Guiding Coalition

Developing a Vision and StrategyDeveloping a Vision and Strategy

Communicating the Change Vision Communicating the Change Vision

Empowering Broad-based ActionEmpowering Broad-based Action

Generating Short-term WinsGenerating Short-term Wins

Consolidating Gains and Producing More Change

Consolidating Gains and Producing More Change

Anchoring New Approaches in the Culture

Anchoring New Approaches in the Culture

Kotter’s Eight-Stage Change Process

Management

The process of achieving organizational goals by engaging in the four major functions of planning, organizing,

leading, and controlling.

It characterizes the process of planning, leading, and directing all or part of an organization, through the deployment or manipulation

of resources

The process of achieving organizational goals by engaging in the four major functions of planning, organizing,

leading, and controlling.

It characterizes the process of planning, leading, and directing all or part of an organization, through the deployment or manipulation

of resources

Leadership

Leadership is the ability to influence others towards the achievement of goals

Leadership is the ability to influence others towards the achievement of goals

ManagementManagement LeadershipLeadership• Planning and budgeting• Organizing and staffing• Controlling and problem solving

• Establishing direction• Aligning people• Motivating and inspiring

Management vs. Leadership

• Produces a degree of predictability and order

and has the potential to consistently produce the

Short-term results expected by various stakeholders

(e.g. for customers, always being on time, for

Stock-holders, being on budget)

• Produces a degree of predictability and order

and has the potential to consistently produce the

Short-term results expected by various stakeholders

(e.g. for customers, always being on time, for

Stock-holders, being on budget)

• Produces change, often to a dramatic degree,

and has the potential to produce extremely

useful change ((e.g. new products that customers

want, new approaches to labor relations that help

make a firm more competitive)

• Produces change, often to a dramatic degree,

and has the potential to produce extremely

useful change ((e.g. new products that customers

want, new approaches to labor relations that help

make a firm more competitive)

Management aims to give consistency and order to organizations

Management aims to give consistency and order to organizations

Leadership seeks to provide constructive and adaptive change

Leadership seeks to provide constructive and adaptive change

Management is directed toward coordinating

activities in order to get the job done

Management is directed toward coordinating

activities in order to get the job done

Leadership is concerned with the process of

developing mutual purposes.

Leadership is concerned with the process of

developing mutual purposes.


Management vs. Leadership -1

Management relies more on a one-way authority relationship

Management relies more on a one-way authority relationship

Leadership relies more on a multidirectional influence

relationship

Leadership relies more on a multidirectional influence

relationship

Managers are people who do things right

Managers are people who do things right

Leaders are people who do theright things

Leaders are people who do theright things


Management vs. Leadership -2

ADAPTING

DIAGNOSIS

COMMUNICATING


Three Competencies of Leadership

The Need forManagement Skills

ManagerialSkills and

Life Success

ManagerialSkills and

Hiring

ManagerialSkills in theNew Work

Environment

Need for Management Skills

Knowing How to Learn

Reading

Writing

Mathematics

Listening

Oral Communication

Problem Solving

Creative Thinking

Self-Confidence

Motivational Goal Setting

Personal and Career Development

Interpersonal Skills

Negotiation

Teamwork

Organizational Effectiveness

Leadership

16 Basic Skills Employees Need

Demand forManagerial

Skills

Entrepreneurship

Downsizing andDelayering

Job Enrichmentand Empowerment

Self-ManagedWork Teams

Hiring for theSecond Job

Growth inManagement Positions

Managerial Skills in the New Work Environment

Conceptual

Conceptual

Conceptual

Human

Human

Human

Technical

Technical

Technical

Top-Level Managers

Middle-LevelManagers

First-Level Managers

Managerial Skills

21

Time

Activity

• industry evolution• diffusion of innovation

tipping points

FAST

SLOW

SLOW

Rate of Change is not Constant

22

Degree of change

time

Discontinuous change

Continuous and Discontinuous Change

23

The gradualist paradigm posits that an organization:

changes and develops though a continuous process of incremental adjustment,

these adjustments (changes) accumulate over time to ensure that the organisation is always aligned with its external environment.

Gradualist Paradigm

24

While a process of continuous gradual adjustment might be the ideal, evidence suggests that most organisations experience change as a discontinuous process often referred to as a pattern of punctuated equilibrium.

Degree of change

time

Discontinuous change

Long periods of equilibrium during which there is little change

Punctuated by short periods of radical (discontinuous) change

Punctuated Equilibrium

25

Intensity of change

time

Continuous and discontinuous change can be viewed from the perspective of the intensity of change

26

Intensity of change

Continuous change involves a stream of low intensity changes that (according to the gradualist paradigm) can accumulate to

transform the organization.

27

Intensity of change

Discontinuous change involves ‘doing things differently or doing different things’Incremental change

involves ‘doing things better’

Dropouts Dropouts Dropouts

Punctuated equilibrium involves long periods of low intensity incremental changes punctuated by

short bursts of high intensity discontinuous change

28

This is the dominant pattern of change because a number of factors act to limit the degree of change that occurs in the periods of low intensity

change

equilibrium : periods of low intensity change

Punctuated equilibrium is the dominant pattern of change

Many people are reluctant to change because:

FEAR (they prefer the status quo to an uncertain future; they anticipate that the cost of changing might outweigh

the benefits)

29

Why is it so hard to change?

30

• Persistent deep structures are the fundamental choices that determine an organization’s pattern of activity.

Football analogyThe rules of the game represent deep structures – taken for granted and difficult to change.

The game-in-play describes activity in periods of equilibrium when the coach and players can make changes that will affect team performance but not the rules of the game.


31

• Tight and loose coupling

Football analogy

It would be difficult for one team to modify the rules. A football club is tightly coupled with the other clubs that play in the same

league

Forces for inertia are strongest when a group, department or organisation is part of a network of tightly coupled mutual

dependencies


• Pressure to deliver short term results

This pressure:

directs managers’ attention towards improving internal alignment in order to increase efficiency.

diverts their attention away from external alignment.

32

structure

technology systems

people

All three factors (fear of change, persistent deep structures and the pressure to deliver short term results) combine to inhibit change and promote strategic drift.

The organization does not change fast enough or in the ways that will ensure that it remains aligned with its external environment.


33

Eventually this misalignment with the external environment reaches a

point where major change (radical transformation) is precipitated.

The trigger for discontinuous change

34

Romanelli and Tushman examined the life histories of 25

minicomputer producers and found a pattern of discontinuous,

episodic change

changes in strategy, structure and power-distribution were clustered in time - the pattern of change predicted by the punctuated equilibrium model

changes were not spread over relatively long periods of time as predicted by the gradualist paradigm.

Evidence supporting the theory of punctuated equilibrium

35

Improvisation that leads to a continuous modification of existing work practices

Continuously adaptive organizations experience the kind of continuous change described by

the gradualist paradigm

This requires organizations to engage in repeated patterns of:

Learning and new insights which facilitate changes in the way the organization responds to problems and opportunities

Translation that involves the editing and imitation of ideas as they travel through the organization

36

But the evidence suggests that most organisations, if they survive long enough, will experience change as a pattern of punctuated equilibrium

There are three exceptions:

37

1. The small minority of “learning organizations” that do manage to

continuously adapt through ongoing processes of improvisation and learning

2. Companies operating in niche markets or in slow moving sectors where they

have not yet encountered the kind of environmental change that requires them

to transform their deep structures.

3. Organizations that are able to continue functioning without transforming

themselves because they have sufficient ‘fat’ to absorb the inefficiencies

associated with misalignment.

38

Combining notions of continuous and discontinuous change

with the way an organisation responds to change (proactive

or reactive) provides a useful typology for classifying types

of change

A Typology of Change

39

-

Proactive(Anticipatory)

Reactive

Incremental(doing things better)

Transformational/discontinuous(doing things differently or doing different things)

1. Fine Tuning

Citibank

2. AdaptationOther banks reaction

to Citibank’s move

3. Re-orientation

Nestle – 1980s

4. Re-creation

Asda – 1990s

A Typology of Change

40

1. Focus for change effort

2. Locus for change: who will manage the process?

3. Sequence of steps in the change process

4. Role of change agent

Implications of these different types of change for change management practice

41

With incremental change the aim is to improve the alignment between existing organizational components in order to ‘do things better’

TaskStructure Culture

People

With discontinuous/transformational change the aim is to seek a new configuration of organizational components that are aligned to external circumstances. The outcome may be that the firm ‘does things differently’ or ‘does different things’

TaskStructure Culture

People

OUTPUTSrequired by external

stakeholders

INPUTSrequired to support the transformed business

1. Focus for change efforts

42

Discontinuous change is more intense than

incremental change, and reactive change tends

to be more intense than anticipatory change

Most intense

Least intense

Re-creation

Re-orientation

Adaptation

Tuning

The intensity of change (indicated by the stress, dislocation and trauma associate with

change) affects the point in the organization where the leadership for change is located.

2. Locus for change

43

Low intensity change

High intensity change

Executive led change

Change through delegation(Project managers and external consultants)

Change through normal management processes

2. Locus for change - Example

44

Change typically involves a three step process that follows the sequence:

UNFREEZE

MOVE

REFREEZE

1. Unfreezing the restraining forces that maintain the status quo

2. Moving the organisation to a new state

3. Refreezing to consolidate the change

3. Sequence of change

45

FREEZE

REBALANCE

UNFREEZE

Freezing in order to take stock, identify patterns and highlight what is happening

Rebalancing – reinterpreting history, identifying and amplifying best practice and re-sequencing patterns

Unfreezing to enable patterns of activity to resume with fewer blockages.

3. Sequence of change - Example

46

With discontinuous/transformational change the role of the change agent is to be the

prime mover who initiates and manages a process of planned change

With rapid continuous change the role of the change agent is to help others make

sense of the change dynamics already under way

4. Role of Change Agent

Lewin’s Model

UNFREEZECHANGE

REFREEZE

dr. roy philip conflict and change management night 1

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