Summary: Process Improvement and change

Chapter 1: Changing organizations in our complex world.

Organizational change = planned alterations of organizational components (like vision, strategy, culture etc.) to improve the effectiveness of the organization.

If employees get the vision of the organization and understand the direction and perspective of where the organization is going and why, they are more likely to embrace their future role.

Environmental forces driving change today:

Globalization means that marketing, research and development, production and other parts of an organization can be moved around the world or outsourced.

PESTE factors: Describe the context of an organization

-Political

-Economic

-Social

-Technological

-Environmental

Three macro changes facing us today Leading to globalization of markets

-Digitization of information

-Integration of nation states and the opening of international markets

-The geographic dispersion of the value chain.

Four types of organizational change

1. Episoxic and discontinuous (planned) vs. continued ( emergent and self-organizing, constant, kaizen = continuous improvement)

2. Programmatic / planned vs. Respons to external events

1.Tuning:

-Small, minor changes

-Ongoing basis to improve efficiency / effectieveness

-Quality improvement programs from middle-management

2.Adapting:

-Minor changes

-Respons to external stimuli – response to observed

-Middle management respons to changes in environment

3.Redirecting or reorienting

-Major strategic changes

-Result from planned programs

-Provide new perspectives and directions in a significant way

4.Overhauling or re-creation

-Dramatic shift

-Reaction to major external events

-Often crisis situation forces the change

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Redirecting and overhauling have angreater impact on the individuals and are more challenging and time consuming.

Participants in organizational change

-Change implementers:

  • The ones making changes happen

-Change initiators / champions

  • Pushed or encouraged
  • Frame the vision for the change
  • Provide resources and support for the initiative.
  • They get things moving, take action and seeking the initiate to make things better.

-Change recipients

  • Receiving the end of change

-Change facilitators

  • Won’t be responsible for implementing the change, but they will assist initiators and implementers in the change through their contacts and consultative assistance.

 One person might of course play multiple roles. The person who leads the change is the change leader / agent.

Requirements for succesful change (4p’s)

-Planning

-Persuasion

-Passion

-Perseverance

Chapter 2: Frameworks for leading the process of organizational change “how” to lead organizational change.

There are two distinct aspects of organizational change that must be adressed:

  1. Managers must decide both How (process) to lead organizational change
  2. Decide What (Content) to change in an organization.

The Sigmoid curve outlines where one should begin changing and where it becomes obvious that one needs to change. The time to introduce change is when the system is growing, and where the line is almost declining.

6 models of organizational change.

  1. Stage Theory of change: Lewin
  1. Unfreeze

-Focus on beliefs and assumption of people engaged in the process who do not have the same ideas

  1. Change
  2. Refreeze

-Once the change has been completed these systems, structures, beliefs and habits can refreeze in their new form.

Concerns regarding this model

-Simplicity: It suggests that change is linear

-Need for change needs more attention

-Change is not seen as a continuous improvement process

  1. Stage model of organizational change: Kotter

 Structured eight stage process:

  1. Establish a sense of urgency:
  2. Create a guiding coalition
  3. Develop a vision and strategy
  4. Communicate the change vision
  5. Empower employees
  6. Generate short-term wins
  7. Consolidate gains and produce more change
  8. Anchor new approaches
  1. Giving Voice to Values: Gentile

Focusses on the ethical implications of organizational change.

GVV takes people through a learning process that prepares them to expect values conflicts and provides the tools to intervene when they perceive wrong doing.

  1. Clarification and articulation of one’s values
  2. Five widly shared values are: Honesty, respect, responsibility, fairness and compassion
  3. Post-decision-making analysis and implementation plan
  4. Stakeholder analysis
  5. Research how stakeholders might respond to change
  6. What levers can you use to persuade stakeholders to join
  7. The practive of speaking one’s values and receiving feedback
  8. Making your values more clear by practicing
  1. Emotional transitions through change: Duck

 Captures the people and their emotional responses to the change process

Ducks’s five-stage change curve:

  1. Stagnation: People have to wake up from external or internal change pressures.
  2. Preparation: Dramatic announcement and planning of change from an internal person.
  3. Implementation: Designing new organization structures, plans and descriptions. And changing people’s mindset and habits
  4. Determination: People start realizing that change is real and their work will change.
  5. Fruition: Hard work pays off and the organization seems new.
  1. Managing the change process: Beckhard and Harris

Has a strong focus on process

  1. Describe the desired future state and current state  Results in a gap analysis.
  2. Describe how the organization will reach this desired state
  3. Manage the transition
  1. The change path model: Cawsey-Deszca-Ingols

Combines process and instructions (more detailed than Beckhard)

Change path:

  1. Awakening:
  1. Leaders need to scan internal and external environment
  1. Mobilization
  1. Determiniation of what specifically needs to change
  2. Vision for change and gap analysis is further developed
  3. Engange people in change process
  1. Acceleration:
  1. Action planning and implementation
  1. Instituationalization:
  1. Succesful conclusion of the transition to the desired new state

The six models have more similarities than differences:

  1. Each is a process model  Describe HOW change should happen.
  2. Lewin and Duck are Descriptive, Kotter, Gentile and Beckhard are presciptive, while the change path combines both
  3. Lewin is system level, Kotter, Beckhard and the change path are organizational level and Gentile and Duck are both
  4. Models describe the same processess but highlight different aspects.

Chapter 4: Building and energizing the need for change

Responsibility diffision: Happens when multiple people are involved and everyone stands by, assuming someone else will act.

External Data

-Published research or trade papers (concrete)

-Comments collected from customers and suppliers (less tangible)

Perspective of stakeholders

-External; suppliers, government, customers, alliances

-Internal; supervisors, employees, IT, finance, HR

 Rule of thumb: Talk with stakeholders three times more you think and listen four times more as you think you should.

Internal Data

-Hard data; custoemr satisfaction, cycle time, service profitability

-Soft data; Found by walking around through the company. How people act.

Develop an assessment of the need for change

  1. What do you see as the need for change and the important dimensions and issues that underpin it?
  2. Have you investigated the perspective of internal and external stakeholders?
  3. Can the different perspectives be integrate in ways that offer the possibility for a collabortative solution?
  4. Have you developed and communcated the message concerning the need for change in ways that have the potential to move the organization to a higher state of readiness for and willingness to change?

Eight dimensions related to readiness:

  1. Trustworthy leadership
  2. Trusting followers
  3. Capable champions
  4. Involved middle management
  5. Innovative culture
  6. Accountable culture
  7. Effective communications
  8. Systems thinking

Once change leaders understand the need for change, they can take different approaches to heighten / increase the awareness of the need throughout the organization by:

  1. Make the organization aware that it is in or near a crisis that needs to be solved.
  2. Identify a transformational leader based on higher-order values
  3. Find a transformational leader to champion the change
  4. Take the tie to identify common or shared goals and work out ways to achieve them.
  5. Use information and education to raise awareness of the need for change.

Readying an organization for change (Armenkin et al.):

  1. The need for change is identified in terms of the gap between the current state and the desired state.
  2. People believe that the proposed change is the right change to make
  3. The confidence of organizational members has been bolstered so that they believe they can accomplish the change.
  4. The change has the support of key individuals the organizational members look to.
  5. The “what’s in it for me” question has been addressed.

Groupthinking can be a hugh problem in readiness for change and should be avoided by:

-Have the leader play an impartial role, soliciting information and input before expressing an opinion.

-Actively seek dissenting views. Role of devil’s advocate, challenging the majority’s opionion.

-Actively perue the discussion and analysis of the costs, benefits and risks of diverse alternatives

-Ensure an open climate for discussion and decision making

-Allow time for reflection

 Developing a well-grounded awareness of the need for change is a critical first step for change leaders when helping organizations overcome members to change.

A vision for change clarifies the road ahead and specifics the purpose of the change and provides guidance and direction for action. Creating a vision is central in making the gap analysis ( visualizing desired state).

Vison is closely connected to the mission of the organization (its fundamental purpose or reason for existence) and informs the core philosophy and values of the organization.

Jick outlines three methods for creating vision:

  1. Leader-developed

 Leader creates vision and communicates it with others

  1. Leader-senior team-developed

 Members of the senior team create the vision

  1. Bottom-up visioning

 Employee-centric approach (=time consuming)

According to Todd Jick good visions are:

-Clear, consistent and easily understood

-Memorable and challenging

-Implementable and tangible

-Stable but flexible

-Excellence centered

According to Lipton, an vision should contain the following to be effective:

  1. The mission or purpose
  2. The strategy for achieving the mission
  3. The elements of the organizational culture that seemed necessary to achieving the mission and supporting the strategy.

Corporate vision (Long term) and Change vision (short term)

Chapter 5: Navigating change through formal structures and systems

An organizational’sformal structure is defined by how tasks are formally divided, grouped, and coordinated. Formal structures are designed to support the strategic direction of the firm by enhancing order, efficiency, effectiveness and accountability.

Formal systems:

-Planning systems

-Control systems

-Performance management

-Reward system

-Information system

 They provide the formal instrastructure that operationalizes the organizational structure

Differentiation: The degree to which tasks are subdivided into separated jobs or tasks.

Integration: The coordination of the various tasks or jobs into a department or group.  Extent to which activities are combined into processes and systems.

Chain of command: Defines how individuals or units within an organizational report to one another up and down the organizational ladder.

Span of control: The number of individuals report to a manager  the ratio of workers to managers in an organization.

Centralization vs. Decentralization: How and where decision making is distributed in an organizational structure

Formal vs. Informal: The degree to which organizational charts exist, are codified and are followed.

Mechanistic organizations: Rely on formal hierarchies with centralized decision making and a clear division of labor. Work is specialized and routine.fits better with cost strategies.

Organic organization: Are more flexible, have fewer rule, procedures and there is less reliance on the hierarchy of authority for centralized decision making. Jobs are less specialized. Fits better innovation

Organizational effectiveness can be reached if there is a fit between the information-processing requirements of an organization and the structural design choices of this informational-processing capacity.

Information processing capacity of structural design choices

-Vertical: Rules, Policies, Hierarhical, vertical communication

-Horizontal: Direct contact, Formal teams, Managerial linking roles.

7 types of relations that will help overcome boundaries impair information flow:

  1. Direct contact
  2. Use of individuals in liaison roles (responsibility for communication) in groups
  3. Multidepartment task forces
  4. Formal teams
  5. Integrating roles
  6. Managerial linking roles
  7. Structures with dual-authority relationships

Gaps versus overlap dilemma (Bolman and Deal). If tasks are not clearly assigned they can easily fall through the organizational cracks. But, if managers overlap assignments they may create conflict, wasted effort and redundancies.

 Structural decisions should follow strategic decisions because the structure will then be there to support the strategy.

The formal approval process does more than ensure that the decision making concerning change is thorough and reasoned. If the process is viewed as legitimate by others in the organization, its decisions will lend legitimacy to what changes are pursued and enhance acceptance.

Howell and Higgins identified to use system awareness to advance change:

-Strategies based on creeping commitment

  • Employee surveys
  • Benchmark data
  • Pilot programs

 Clarify the need for change and reduce resistance

-Strategies based on Coalition building

  • Identify key user groups
  • Move decision in a favourable direction
  • Support from key coalition members to get formal approval

Renegade method: It is often easier to gain forgiveness than permission to do something in organizations. (Peter Grant’s Just do it’ approach)

The effective use of the formal commitment, performance management and reward systems can play useful roles in gaining acceptance and commitment. The way that systems and processes are deployed will influence the perception of change.

There is a greater need for flexibility and adaptiveness, which can be achieved by

-Processes to promote trust

-Communication

-Cross functional teams

-Flattened structure

-Transparency in leadership

-Collaborative relationships

Chapter 6: Navigating Organizational politics and culture

Power can be used strategically to influence organizations toward healthier ends. Capacity to influence others to accept one’s ideas or plans.

Hardy’s dimensions of power:

  1. Resource power: The access to valued resources in an organization
  2. Process power: The control over formal decision-making arenas and agendas
  3. Meaning power: The ability to define the meaning of things

The culture of a group can be defined as six sub-parts:

  1. A pattern of shared basic assumptions
  2. That was learned by a group
  3. As it solved its problems of external adaption and internal integration
  4. That has worked well enough to be considered valid
  5. Therefore to be taught to new members
  6. As the correct way to perceive, think and feel in relation to those problems.

To analyse a culture, there are three levels (Schein):

  1. The visible aspect or artifacts of the organization
  2. The organization’s espoused beliefs, values and strategy.
  3. Most change agents start change at this level of culture.
  4. Basic underlying assumptions that have becomeso ingrained and so much a part of a group’s thinking and perspective on the world that they are not questioned.
  5. Are extreme difficult to change

A change agent needs to analyse a culture at three levels:

  1. Observe the artifacts: Ex. How people are dressed and interact.
  2. Read documents and talk to people to learn espoused beliefs and values: Ex. What does the organization say about itself on the internet
  3. Observe and ask people about underlying assumptions: Ex. What is the nature of human being?

Power tactics: Strategies and tactics deployed to influence others to accept one’s ideas or plans.

The change equation: The more people see the benefits of a change or the more they are dissatisfied with current situation, the more they are willing to change. People need to perceive both positive impact of the change on organizational and individual level.

Useful tools in helping change leaders to understand forces against change

  1. Force field analysis: identifying and analysing the driving and restraining forces in an organization.
  2. Stakeholder analysis: A process of identifying the key individuals or groups in the organization who can influence the proposed change. making stakeholder map to show all people and positions.

Cross and Prusak clarify organizational members as:

-Central connectors: People who link with one another

-Boundary spanners: People who connect the formal and informal networks to other parts of the organization.

-Information brokers: People who link various subgroups.

-Peripheral specialists: People who have specialized expertise in the network.

Moving each stakeholder on a change continuum:

Awareness of the issue  Interest  Desire for action  Take action

Flip-flop changes: Forces are weak and change events are not very important, but the situation could change only to reverse itself easily. (For example if people have shifting preferences).

Change occurs when:

Perceived benefits of change > Perceived cost of change

OR

Dissatisfaction X Benefits X Succes > Cost