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Slide 14.

Managing Change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.2

Outcomes
• Identify the types of change and key drivers
• Understand who and what are the resistors of
change and how resistance can be overcome
• Explain and assess change processes
– management of organisational routines
– political and symbolic processes
– other change tactics
• Determine different styles of change
management and their impact

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.3

Exhibit 14.1 Key elements in managing strategic change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.4

Strategic Change Management


“There is nothing more difficult to
take in hand, more perilous to
conduct, or more uncertain in its
success than to take the lead in
the introduction of a new order of
things”
Machiavelli

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.5

Causes and Dynamics of Strategic


Change
Causes (Tichy Dynamics (Kanter,
1983) Stein & Jick
• Environment 1992)
• Business • Environment
Relationships • Life cycle
• Technology differences
• People • Political power
changes in the
organisation
Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.6

Environment

Values Resources

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.7

Environment

Pressures for Opportunities


discontinuous for continuous
change improvement

STRATEGIC
EFFECTIVENESS

Ability to Efficiency and


manage effectiveness
change of existing
effectively strategies

Values Resources
Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.8

Power and Politics


• Relative power of organisation
• Political activity
– Legitimate or illegitimate
– Vertical or lateral
– Internal or external
• Bases of power
– reward and coercive power
– legitimate
– personal
– expert
– information
– visible/invisible - ability to prevent decisions, control issues,
ensure certain issues are ignored

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.9

CULTURAL WEB

Stories

Rituals and
Routines Symbols

Paradigm

Power
Controls

Organisation

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.10

Force Field Analysis

Forces for change Forces resisting


change
Equilibrium

Driving forces Restraining forces

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.11

Change resistance grid


Extent to which employees are

High change

Source: Adapted from Witte (1990)


satisfied with the status quo

Satisfied resistant
organisation
Resistors Undecided
Dissatisfied

Undecided Supporters
Low change
resistant
organisation

Distrust Trust

Extent to which employees


trust the organisation

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.12

Nature of Change
Proactive
Planned
MANAGEMENT ROLE

Tuning
transformational

Adaptation Forced
Reactive

transformational

Incremental Transformational
Change Change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.13

Overcoming Resistance
• Education and communication
• Participation and involvement
• Facilitation and support
• Negotiation and agreement
• Manipulation and co-option
• Explicit and implicit coercion
Kotter & Schlesinger (1979)

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Prescriptive Approaches to
Slide 14.14

Change
• Unfreezing • Changing Identity of
– readiness to acquire or learn Organisation
new behaviour – Response to environment
• Change •Coordination & Transition
– Trying out new ideas - 5 Phases of organisational
growth
– Altered power structures
• Control over organisational
– Change champion politics
• Refreezing (participation,
involvement & commitment Kanter Stein and Jick
– New behaviour patterns are
accepted 1992
– Supportive
– Rewards
Lewin 1947

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Emergent Approaches to
Slide 14.15

Change
Five Factors Theory
(Continuous) • Environmental Assessment
• Leading change
Learning Theory • Linking strategic and operational
– Team learning change
• Strategic human resource
– Sharing views/vision management
– Exploring/ changing • Coherence
• Consistency
ritual & beliefs
• Consonance
– Skills development • Competitive advantage
• Feasibility
– Systems
Pettigrew & Whipp 1991
management
Senge 1990

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.16

Internal change
implementation
 Gain support of key decisions makers and facilitators
 Change attitudes among employees who deal with customers
 Obtain employees’ commitment to making the strategic plan work by
• involving them in the ownership of the plan
• rewarding them on the plans’ attainment
 Train staff - develop new skills that will contribute to the effective
implementation of plans

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.17

Exhibit 14.2 Types of change


Source: Adapted from J. Balogun and V. Hope Hailey, Exploring Strategic Change, 2nd Edn, Prentice Hall, Pearson Education Ltd, 1999

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.18

Exhibit 14.3 Contextual features of strategic change programmes

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.19

Exhibit 14.4 A forcefield analysis

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.20

Exhibit 14.5 Styles of managing strategic change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.21

Exhibit 14.6 Organisational rituals and culture change

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.22

Exhibit 14.7 Political mechanisms in organisations

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008
Slide 14.23

Exhibit 14.8 Turnaround: revenue generation and cost reduction steps

Johnson, Scholes and Whittington, Exploring Corporate Strategy, 8th Edition, © Pearson Education Limited 2008