10/19/17

Managing Change and

Innovation
BA 101 – Introduction to Management
Louie Lee

Balance BA 101 Schedule

• 2nd Long Exam: November 8 and 10

• Case Presentations: November 29-December 15

• Paper Deadline: December 18

• (PANA Finals: November 11)

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What is organizational change?

A change across the organization that impacts one

or more dimensions of its functioning, such as
staffing, structuring work allocation or turnouts

What is organizational change?

Marissa Mayer becomes Yahoo’s

new CEO
Mayer’s transition has improved Yahoo’s
business from almost every angle.
Stocks have increased and quarterly
earnings have improved. But, more
importantly, employees are embracing
their new leader. Under Mayer’s
leadership, employees who had
previously left Yahoo were coming back,
and she has said Yahoo’s workplace
standing and employee belief in the
company has improved.

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What is organizational change?

Marissa Mayer becomes Yahoo’s

new CEO
What she got right: Mayer placed a lot
of energy on managing talent in the
company and getting employees
excited about working at Yahoo. In
2013, she said there had been at least
560 employee-focused initiatives
implemented to bolster morale,
including a new program designed to
encourage employees to test products.
As a new leader, Mayer understood the
need to make sure her employees were
happy and felt valued.

Forces for organizational change

• External Forces • Internal Forces

– Marketplace – Changes in
organizational
– Governmental strategy
laws and
regulations – Workforce
changes
– Technology
– New equipment
– Labor market
– Employee
– Economic attitudes
changes

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Types of organizational change (within organization)

• Structural
– Changing the organization’s
structure or its structural
components
• Technological
– Adopting new equipment or
operating methods that
displace old skills and require
new ones
• Automation: replacing
certain tasks done by
people with machines
• Computerization
• People
– Changing attitudes,
expectations,
perceptions, and
behaviors of the
workforce
– Techniques or
programs to change
people and the nature
and quality of
interpersonal work
relationships.

Types of organizational change (according to purpose)

• Growth /expansion
– As an organization grows , jobs tend to
expand in scope as well as number; structures
are more complex
• “To win”
– Competition driven; establish
market/competitive advantage;
• Continuous learning
– Continuously adapting new ways of thinking
and doing things involving entire organization
from top down and vise versa

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Types of organizational change (according to timing)

• Gradual
– Change that occurs slowly over a prolonged
period at a steady rate or with minor
fluctuations in intensity
• Radical
– from a stable period to a sudden, dramatic
change done in a single stoke resulting in
marked effects
• Crises
– Change that has a roller coaster pattern;
radical action in response to a crises is
followed by a marked fall off / clam until the
next crises

Responses to change

LEAD RESIST
FOLLOW

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Responses to change

Managers are expected

to be catalysts of change

Or people who are

responsible for the
changing process

Lewin’s Change Model

• Unfreezing
– Creates the motivation to change
– Activities such as data presentation that allow
members to understand WHY change has to
happen

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Lewin’s Change Model

• Changing
– Provides new information, new behavioral
models or new ways of looking at things
– Activities that introduce the change in as clear
matters as possible to the members

Lewin’s Change Model

• Refreezing
– Helps employees integrate the changed
behavior or attitude into their normal way of
doing things
– Activities that embed change into members’
operations

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Lewin’s Change Model

• Driving Forces • Restraining Forces

– Forces that direct – Forces that hinder
behavior away movement from
from the status the existing
quo equilibrium

Kotter’s Eight Steps for Organizational Change

Step Description

1) Establish a sense of Unfreeze the organization by creating

urgency a compelling reason for why change is
needed
2) Create the guiding Create a cross-functional, cross-level
coalition group of people with enough power
to lead the change

3) Develop a vision Create a vision and strategic plan to

and strategy guide the change process

4) Communicate the Create and implement a

change-vision communication strategy that
consistently communicates the new
vision and strategic plan

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Kotter’s Eight Steps for Organizational Change

Step Description
5) Empower broad- Eliminate barriers to change, use
based action target elements of change to
transform the organization
6) Generate short-term Plan for and create short-term “wins”
wins or improvements

7) Consolidate gains The guiding coalition uses credibility

and produce more from short-terms wins to create
change. Additional people are
change brought into the change process as
change cascades throughout the
organization
8) Anchor new Reinforce the changes by highlighting
approaches in the connections between new behaviors
and processes and organizational
culture
success

Kotter’s & Lewin’s Theories

1. Establish a sense of urgency

2. Create the guiding coalition
3. Develop a vision and UNFREEZING
strategy
4. Communicate the change
5. Empower broad-based
action CHANGING
6. Generate short-term wins
7. Consolidate gains and
produce more change
8. Anchor new approaches in REFREEZING
the culture

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Resistance to Change

• Resistance to change appears to be a natural and

positive state
• Forms of Resistance to Change:
– Overt and Immediate
• Voicing complaints, engaging in job actions
– Implicit and Deferred
• Loss of employee loyalty and motivation, increased
errors or mistakes, increased absenteeism
• Deferred resistance clouds the link between source
and reaction

Resistance to Change

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Overcoming Resistance to Change

Approach Commonly Used in Advantages Drawbacks

Situations Where:

Education and There is a lack of Once persuaded, Can be very time

Communication information or people will often consuming if lots
inaccurate help with of people are
information & implementation involved
analysis of change

Participation and The initiators do People who Can be very time

Involvement not have all the participate will consuming if
information they be committed to participators
need to design the design an
the change & implementation inappropriate
others have of change change
considerable
power to resist

Overcoming Resistance to Change

Approach Commonly Used in Advantages Drawbacks

Situations Where:

Facilitation and People are No other Can be very time

Support resisting because approach works consuming,
of adjustment as well with expensive and
problems adjustment still fail
problems

Negotiation and Someone or Sometimes it is a Can be too

Agreement some group will relatively easy expensive in may
clearly lose out in way to avoid cases if it alerts
a change and major change other to
where that group negotiate for
has considerable compliance
power to resist

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Overcoming Resistance to Change

Approach Commonly Used in Advantages Drawbacks

Situations Where:

Manipulation and Other tactics will It can be Can lead to

Co-optation not work or are relatively quick future problems
too expensive and inexpensive if people feel
manipulated

Explicit and Implicit Speed is It is speedy and Can be very risky

Coercion essential and can overcome ad leave people
where the any kind of mad at the
change initiators resistance initiators
possess
considerable
power

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