Reasons For Change Within An Organisation Management Essay

Reasons For Change Within An Organisation Management Essay Some changes are implemented as a result of problems within organisations, but many Changes come about as a result of organisations proactively seeking business benefits such as reducing costs or improving services. The Change Management process ensures that standardised methods and procedures are used to minimise the impact of changes on quality of service, and improve the day-to-day operations of the organisation. It is important that in implementing changes to an organization that the board of directors and management of the organisation assess risk to the continuity of the organization, resource requirements needed for the change and maintain a proper balance between the need for Change against the impact of the Change. It is particularly important that Change Management processes have high visibility and open channels of communication in order to promote smooth transitions when Changes take place. It is imperative to get employees to buy into the need for change and the changes themselves. It is very important that all employees be informed about the issue bringing on the need for change, the possible outcomes and the plan for solution. They must also understand their own roles in the process. This will help break down barriers to implementing the change. This study will appraise the implementation of the change process including resistance to change and practical management aspects. In this study we will use Chorus as real life example of the change process and its implementation. Chorus, a steel company operates in a fast changing environment. They had to respond to these changes to beat rivals and meet customers needs. Chorus needed the commitment and support of staff to make changes that shape the business in the longterm. Corus has three divisions, one of which is Corus Strip Products UK (CSP). CSP UK makes steel in strip form. CSP UK has put in place a major change programme called The Journey to overcome any barriers to change and secure a better future for the business. Reasons for change Organisations typically change in response to the external environment, as well as through the development of competitive strengths within the organisation. External environmental factors include: Social factors e.g. changes in demography and consumer buying patterns. Legal factors legal pressures that force organisations to change to comply with laws, e.g. by responding to environmental legislation. Economic factors relate to booms and slumps in general economic activity, changes in interest rates, inflation rates etc. Political factors relate to wider political changes for example, a government taking a particular line on privatisation/the role of the state in society. Technological factors relate to new developments in technology e.g. the development of new web based selling methods by companies. On top of the above SLEPT (Social, Legal, Economic, Political and Technological) factors a major influence on the organisation is what the competition is doing. A SLEPT analysis is an analysis of key changes in an organisations environment. It is sometimes referred to as scanning the environment. The management of change is a key aspect of the way in which an organisation responds to change in an appropriate way. The emphasis should be on managing the change rather than reacting to change. Other ways in which organisations change are by altering their culture, i.e; changing the typical patterns and behaviours within the organisation e.g. moving from a top-down organisation to a more democratic form. Becoming more customer or marketing focused as opposed to production oriented. Most organisations today are developing this customer focus. Altering the scope of their activities e.g. by taking on new activities or by operating in new geographical areas. For example, most large companies today have become global enterprises and they have often reduced the number of brands and products they offer in order to concentrate on power brands in global markets. Usually organizational change can be brought about by some major outside driving force, e.g., substantial cuts in funding, address major new markets/clients, need for dramatic increases in productivity/services, etc. Typically, organizations must undertake organization-wide change to evolve to a different level in their life cycle, e.g., going from a highly reactive, entrepreneurial organization to more stable and planned development. Transition to a new chief executive can provoke organization-wide change when his or her new and unique personality pervades the entire organization. According to Kurt Lewin good communication is an important part of the process of changing the organisation. This involves communicating the direction of change, the objectives, how the change will be carried out and who will be involved. Downloaded from The Times 100 Editi http://www.thetimes100.co.uk/downloads/theory/the_organisation_and_change.pdf Change in a Chorus was a planned process. It followed a clear structure. Chorus identified the barriers to its changes, created and applied a plan for change and a method for measuring its success. Internal drivers for change at Chorus UK were: à ¢Ã¢â€š ¬Ã‚ ¢ poor delivery à ¢Ã¢â€š ¬Ã‚ ¢ competitiveness à ¢Ã¢â€š ¬Ã‚ ¢ high wastage à ¢Ã¢â€š ¬Ã‚ ¢ low staff morale. External drivers were: à ¢Ã¢â€š ¬Ã‚ ¢ new rivals à ¢Ã¢â€š ¬Ã‚ ¢ changing customer needs à ¢Ã¢â€š ¬Ã‚ ¢ new technology à ¢Ã¢â€š ¬Ã‚ ¢ poor views of the steel sector. Barriers to change Different types of change require different approaches, but fundamentally managers of staff need to ensure that they support their team through the change. Individuals must also prepare themselves for change. Typically there are strong resistances to change. People are afraid of the unknown. Many people think things are already just fine and dont understand the need for change. Many are inherently cynical about change, particularly from reading about the notion of change as if its a mantra. Many doubt there are effective means to accomplish major organizational change. Often there are conflicting goals in the organization, e.g., to increase resources to accomplish the change yet concurrently cut costs to remain viable. Organization-wide change often goes against the very values held dear by members in the organization, that is, the change may go against how members believe things should be done. Thats why much of organizational-change literature discusses needed changes in the culture of the organization, including changes in members values and beliefs and in the way they enact these values and beliefs. Every organization has a distinct culture. Sometimes the culture is fragmented and difficult to understand, but most organizational cultures are very strong. Organizational culture influences and affects many aspects of employees personal and professional life. It affects what decisions are made, who gets promoted, how people dress and how the work force behaves. Culture binds people into a cohesive group. However, change can be perceived as a threat. Yet one thing is constant. People are resistant to change. We are all creatures of habit and will continue doing the things that we are doing unless those habits are reformed in some manner. Organizations can often be more resistant to change than an individual. They are made up of several individuals, each having his/her own resistance, therefore providing collective resistance. Change also requires utilization of limited resources. Costs can be prohibitive. The politics of an organization and threats to an individuals power or influen ce can often deter necessary change as well. Fullan, M. and Stiegelbauer, S. (1991). The New Meaning of Educational Change. New York: Teachers College Press. Excerpted from Leadership and Technology, published by the National School Boards Associations Institute for the Transfer of Technology to Education. Chorus identified from very early stages that change would challenge or threaten peoples abilities, experience, customs and practice. It identified the following barriers to its planed change: à ¢Ã¢â€š ¬Ã‚ ¢ an attitude of this is the way we do things around here à ¢Ã¢â€š ¬Ã‚ ¢ some staff saw change as a threat to their teams and roles à ¢Ã¢â€š ¬Ã‚ ¢ some of Corus past changes had led to job cuts. This caused insecurity and low morale à ¢Ã¢â€š ¬Ã‚ ¢ Corus gave rewards for long service rather than great service. This meant that staff who had been with Corus a long time gained greater rewards than new staff who were performing better. www.thetimes100.co.uk EDITION 15 Downloaded from The Times 100 Edition 15 | www.thetimes100.co.uk Overcoming barriers to change Brief Case Overcoming barriers Cummings and Worley (Organization Development and Change, 1995) describe a comprehensive, five-phase, general process for managing change, including: motivating change This phase includes creating a readiness for change in your client organization and developing approaches to overcome resistance to change. General guidelines for managing this phase include enlightening members of the organization about the need for change, expressing the current status of the organization and where it needs to be in the future, and developing realistic approaches about how change might be accomplished, creating vision Leaders in the organization must articulate a clear vision that describes what the change effort is striving to accomplish. Ideally, people in the organization have strong input to the creation of the vision and how it can be achieved. The vision should clearly depict how the achievement of the developing political support This phase of change management is often overlooked, yet it is the phase that often stops successful change from occurring. Politics in organizations is about power. Power is important among members of the organization when striving for the resources and influence necessary to successfully carry out their jobs. Power is also important when striving to maintain jobs and job security, http://www.authenticityconsulting.com managing the transition This phase occurs when the organization works to make the actual transition from the current state to the future state. In consultations, this phase usually is called implementation of the action plans. The plans can include a wide variety of interventions, or activities designed to make a change in the organization, for example, creating and/or modifying major structures and processes in the organization. These changes might require ongoing coaching, training and enforcement of new policies and procedures and sustaining momentum Often, the most difficult phase in managing change is this phase when leaders work to sustain the momentum of the implementation and adjustment of plans. Change efforts can encounter a wide variety of obstacles, for example, strong resistance from members of the organization, sudden departure of a key leader in the organization, or a dramatic reduction in sales. Strong, visible, ongoing support from top leadership is critically important to show overall credibility and accountabilities in the change effort. http://www.managementhelp.org/misc/reqs-for-successful-change.pdf In my opinion, the first step in implementing change is to get employees to buy in to the need for change and the changes themselves. It is very important that all employees be informed about the issue bringing on the need for change, the possible outcomes and the plan for solution. They must also understand their own roles in the process. This will help break down barriers to implementing the change. Once the changes have been implemented, over time they will become the new habits that bring desirable results. There is a relatively new and innovative process called appreciative inquiry (AI), which addresses change by using the organizations employees, customers and vendors to design the future of the organization. According to the article, Appreciative Inquiry: An Innovative Process for Organizational Change, from Employee Relations Today, Appreciative inquiry engages the entire organization in discovering the best of what has been and dreaming about the best of what might be. Forming transition teams of employees from all aspects of the business can also help to facilitate change and encourage employee involvement and buy-in. Some organizations gather input from surveys, but if that is the preferred method, it is imperative that the results are shared and discussed. Not doing so will destroy employee morale and trust. When seeking input, make sure the responses are communicated. Be honest in providing feedback to the employees. Address their concerns, and if the issues cant be resolved within the resources and constraints of the organization, simply explain the reasons. Willis Mushrush, business specialist MO SBTDC for University of Missouri Extensions Creating Quality newsletter Sept. 2003. Successful change must involve top management, including the board and chief executive. Usually theres a champion who initially instigates the change by being visionary, persuasive and consistent. A change agent role is usually responsible to translate the vision to a realistic plan and carry out the plan. Change is usually best carried out as a team-wide effort. Communications about the change should be frequent and with all organization members. To sustain change, the structures of the organization itself should be modified, including strategic plans, policies and procedures. This change in the structures of the organization typically involves an unfreezing, change and re-freezing process. The best approaches to address resistances is through increased and sustained communications and education. For example, the leader should meet with all managers and staff to explain reasons for the change, how it generally will be carried out and where others can go for additional information. A plan should be developed and communicated. Plans do change. Thats fine, but communicate that the plan has changed and why. Forums should be held for organization members to express their ideas for the plan. They should be able to express their concerns and frustrations as well. Corus has overcome these barriers by working with staff. Staff were also urged to take ownership of the new values. Workers are now more involved in choices and are recognised for doing well. Corus ensures that all staff know what is expected through a range of means. Workshops, newspapers, billboards, intranet, video and direct one-to-one talks spread the message. A programme with shock tactics was brought in to show staff the plants condition, identify weak points and urge staff to make changes. Measuring the outcomes of change Corus set targets to make sure that actions led to results. Steps were set so staff would know how well CSP UK was hitting targets. CSP UK has improved many aspects of its business by facing up to its internal weak points. This has helped it to grow. Key Performance Indicators have shown improvements in: à ¢Ã¢â€š ¬Ã‚ ¢ production à ¢Ã¢â€š ¬Ã‚ ¢ lower costs à ¢Ã¢â€š ¬Ã‚ ¢ less absence from work à ¢Ã¢â€š ¬Ã‚ ¢ quality and service for customers à ¢Ã¢â€š ¬Ã‚ ¢ Health and Safety targets à ¢Ã¢â€š ¬Ã‚ ¢ CO2 emissions à ¢Ã¢â€š ¬Ã‚ ¢ the impact on the local community. Conclusion To respond effectively to ever-changing demands, organizations must be prepared to change constantly. Managers must be able to recognize the need for change and identify and manage sources of resistance. The key to successful organizational change is to involve the employees in each step of the process. Change management at CSP UK meant bringing the issues out into the open. CSP UK tackled barriers to change by winning the support of its staff. Its effective plan for change has helped CSP UK to continue to make profit in spite of the recession. www.thetimes100.co.uk EDITION 15 Downloaded from The Times 100 Edition 15 | www.thetimes100.co.uk Honesty Professionalism Integrity Fairness Improvement Transparency Respect Excellence #506 from Innovative Leader Volume 9, Number 12 December 2000