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ORGANIZATIONAL CHANGE
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AND DEVELOPMENT
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Organizational Change

In todays business world, most of the organizations are facing a

dynamic & changing environment. They should either change or die,
there is no third alternative. Organizations that learn & cope with
change will flourish&others who fail to do so will be wiped out.

Features:

Changes results from the pressure of both internal & external forces in
the organization.

Change can occur in any part of the organization.

Change affects people & structure of the organization.
Change may be reactive or proactive.
Factors:

1. External Factors
a. TECHNOLOGICAL CHANGES
b. SOCIAL CHANGES
c. POLITICAL CHANGES
d. CHANGE IN MARKETING CONDITIONS
2. Internal Factors
a. NATURE OF THE WORK FORCE
b. CHANGE IN MANAGEMENT
c. PESONNEL DEFICIENCIES IN EXISTING MANAGEMENT STRUCTURE

Challenges:

Extent of planning

Degree of change

Degree of learning

Target of change

Organization Structure
Resistance to change:

Extent of planning

Degree of change

Degree of learning

Target of change

Organization Structure
Overcoming Resistance:

INDIVIDUAL LEVEL :
EFFORT AT THE INDIVIDUAL LEVEL PARTICPATION & INVOLVEMENT
EFFECTIVE COMMUNICATION LEADERSHIP FACILITATION & SUPPORT

GROUP LEVEL :
EFFORTS AT GROUP LEVEL MANAGEMENT SHOULD CONSIDER THE&
NOT THE INDIVIDUAL AS THE BASIC UNIT OF CHANGE

Planned Change
Once managers and an organization commit to planned change, they
need to create a logical step-by step approach in order to accomplish
the objectives.
Planned change requires managers to follow an eight-step process for
successful implementations

Process:

Recognize the need for change. Recognition of the need for change
may occur at the top management level or in peripheral parts of the
organization. The change may be due to either internal or external forces.
Develop the goals of the change. Remember that before any action is
taken, it is necessary to determine why the change is necessary. Both
problems and opportunities must be evaluated. Then it is important to define
the needed changes in terms of products, technology, structure, and culture.
Select a change agent. The change agent is the person who takes
leadership responsibility to implement planned change. The change agent
must be alert to things that need revamping, open to good ideas, and
supportive of the implementation of those ideas into actual practice.
Diagnose the current climate. In this step, the change agent sets about
gathering data about the climate of the organization in order to help
employees prepare for change. Preparing people for change requires direct
and forceful feedback about the negatives of the present situation, as
compared to the desired future state, and sensitizing people to the forces of
change that exist in their environment.
Select an implementation method. This step requires a decision on the
best way to bring about the change. Managers can make themselves more
sensitive to pressures for change by using networks of people and
organizations

with

different

perspectives

and

views,

visiting

other

organizations exposed to new ideas, and using external standards of

performance, such as competitor's progress.
Develop a plan. This step involves actually putting together the plan, or
the what information. This phase also determines the when, where, and
how of the plan. The plan is like a road map. It notes specific events and
activities that must be timed and integrated to produce the change. It also
delegates responsibility for each of the goals and objectives.
Implement the plan. After all the questions have been answered, the
plan is put into operation. Once a change has begun, initial excitement can
dissipate in the face of everyday problems. Managers can maintain the
momentum

for

change

by

providing

resources,

developing

new

competencies and skills, reinforcing new behaviors, and building a support

system for those initiating the change.
Follow the plan and evaluate it. During this step, managers must
compare the actual results to the goals established in Step 4. It is important
to determine whether the goals were met; a complete follow-up and
evaluation of the results aids this determination. Change should produce
positive results and not be undertaken for its own sake.
Keep in mind that a comprehensive model of planned change includes a set
of activities that managers must engage in to manage the change process
effectively. They must recognize the need for change, motivate change,
create a vision, develop political support, manage the transition, and sustain
momentum during the change.
Organization Growth & Change Implications
Organizational

growth,

means

different

things

to

different

organizations. Indeed, there are many parameters a company can

select to measure its growth. The most meaningful yardstick is one

that shows progress with respect to an organization's stated goals.
The ultimate goal of most companies is profit, so net profit, revenue,
and other financial data are often utilized as "bottom-line" indications
of growth.
Others may use sales figures, number of employees, physical expansion, or
other criteria to judge organizational growth.

Growth Cycle:

Factors for change:

Technology
Customer Needs

 Economy
Growth Opportunities
Work Process
Product Innovation

Coping with change in Order to Grow:

Joint Venture
Alliances
Subcontracting
Licensing
Divestment
New Markets
New Product Development
Outside Financing

Challenges
Dramatic or Incremental
Dilution of Hands-On Capability

 Complexity of Tasks
Accretion of Numbers
Relation to Members & Environment Change
Transformational effect
Healthy Communication
HR Practices

KURT LEWIN THREE PHASES CHANGE THEORY

Kurt Lewin proposed a three stage theory of change commonly referred to
as Unfreeze, Change, Freeze (or Refreeze). It is possible to take these
stages to quite complicated levels.
A lot has changed since the theory was originally presented in 1947, but the
Kurt Lewin model is still extremely relevant. Many other more modern
change models are actually based on the Kurt Lewin model.
stages. Unfreezing, Change, Freezing. Let's look at each of these.

Stage 1: Unfreezing

So,

three

The Unfreezing stage is probably one of the more important stages to

understand in the world of change we live in today. This stage is about
getting ready to change. It involves getting to a point of understanding that
change is necessary, and getting ready to move away from our current
comfort zone.
This first stage is about preparing ourselves, or others, before the change
(and ideally creating a situation in which we want the change).
Unfreezing and getting motivated for the change is all about weighing up the
'pro's' and 'con's' and deciding if the 'pro's' outnumber the 'con's' before you
take any action. This is the basis of what Kurt Lewin called the Force Field
Analysis.
Force Field Analysis is a fancy way of saying that there are lots of different
factors (forces) for and against making change that we need to be aware of
(analysis). If the factors for change outweigh the factors against change
we'll make the change. If not, then there's low motivation to change - and if
we feel pushed to change we're likely to get grumpy and dig in our heels.
This first 'Unfreezing' stage involves moving ourselves, or a department, or
an entire business towards motivation for change. The Kurt Lewin Force Field
Analysis is a useful way to understand this process and there are plenty of
ideas of how this can be done.

Stage 2: Change - or Transition

Kurt Lewin was aware that change is not an event, but rather a process. He
called that process a transition. Transition is the inner movement or journey
we make in reaction to a change. This second stage occurs as we make the
changes that are needed.
People are 'unfrozen' and moving towards a new way of being.

That said this stage is often the hardest as people are unsure or even fearful.
Imagine bungey jumping or parachuting. You may have convinced yourself
that there is a great benefit for you to make the jump, but now you find
yourself on the edge looking down. Scary stuff! But when you do it you may
learn a lot about yourself.
This is not an easy time as people are learning about the changes and need
to be given time to understand and work with them. Support is really
important here and can be in the form of training, coaching, and expecting
mistakes as part of the process.
Using role models and allowing people to develop their own solutions also
help to make the changes. It's also really useful to keep communicating a
clear picture of the desired change and the benefits to people so they don't
lose sight of where they are heading.

Stage 3: Freezing (or Refreezing)

Kurt Lewin refers to this stage as freezing although a lot of people refer to it
as 'refreezing'. This stage is about establishing stability once the changes
have been made. The changes are accepted and become the new norm.
People form new relationships and become comfortable with their routines.
This can take time.
It's often at this point that people laugh and tell me that practically there is
never time for this 'freezing' stage. And it's just this that's drawn criticism to
the Kurt Lewin model.
In todays world of change the next new change could happen in weeks or
less. There is just no time to settle into comfortable routines. This rigidity of
freezing does not fit with modern thinking about change being a continuous,
sometimes chaotic process in which great flexibility is demanded.

So popular thought has moved away from the concept of freezing. Instead,
we should think about this final stage as being more flexible, something like
a milkshake or soft serv icecream, in the current favourite flavour, rather
than a rigid frozen block. This way 'Unfreezing' for the next change might be
easier.

Force Field Analysis

Force field analysis is a management technique developed by Kurt Lewin, a
pioneer in the field of social sciences, for diagnosing situations. It will be
useful when looking at the variables involved in planning and implementing a
change program and will undoubtedly be of use in team building projects,
when attempting to overcome resistance to change.
Lewin assumes that in any situation there are both driving and restraining
forces that influence any change that may occur.

Driving Forces
Driving forces are those forces affecting a situation that are pushing in a
particular direction; they tend to initiate a change and keep it going. In terms
of improving productivity in a work group, pressure from a supervisor,
incentive earnings, and competition may be examples of driving forces.

Restraining Forces
Restraining forces are forces acting to restrain or decrease the driving forces.
Apathy, hostility, and poor maintenance of equipment may be examples of
restraining forces against increased production. Equilibrium is reached when
the sum of the driving forces equals the sum of the restraining forces. In our

example, equilibrium represents the present level of productivity, as shown

below.

Equilibrium
This equilibrium, or present level of productivity, can be raised or lowered by
changes in the relationship between the driving and the restraining forces.
For illustration, consider the dilemma of the new manager who takes over a
work group in which productivity is high but whose predecessor drained the
human resources.
The former manager had upset the equilibrium by increasing the driving
forces (that is, being autocratic and keeping continual pressure on
subordinates) and thus achieving increases in output in the short run.

By doing this, however, new restraining forces developed, such as increased

hostility and antagonism, and at the time of the former manager's departure
the restraining forces were beginning to increase and the results manifested
themselves in turnover, absenteeism, and other restraining forces, which
lowered productivity shortly after the new manager arrived. Now a new
equilibrium at a significantly lower productivity is faced by the new manager.
Now just assume that our new manager decides not to increase the driving
forces but to reduce the restraining forces. The manager may do this by
taking time away from the usual production operation and engaging in
problem solving and training and development.
In the short run, output will tend to be lowered still further. However, if
commitment to objectives and technical know-how of the group are
increased in the long run, they may become new driving forces, and that,
along with the elimination of the hostility and the apathy that were
restraining forces, will now tend to move the balance to a higher level of
output.
Managers are often in a position in which they must consider not only output
but also intervening variables and not only short-term but also long-term
goals. It can be seen that force field analysis provides framework that is
useful in diagnosing these interrelationships.

The Change Cycle Model

Change has always been a necessary aspect of life and work, and our world
is changing more rapidly than ever. It is likely that you will have to cope with
a variety of changes in the near future. Your success and fulfillment - your
emotional, mental, spiritual and physical well-being - depend on how well
you adapt to change.
People react, respond and adjust to change in a sequence of six predictable
stages. The Change Cycle model identifies the thoughts, feelings and
behaviors associated with each stage of change. There is no better map to
assist you in navigating through the changes in your life.

Stage 1 Loss to Safety.

In Stage 1 you admit to yourself that regardless of whether or not you
perceive the change to be good or 'bad" there will be a sense of loss of what
"was."
Stage 2 Doubt to Reality.
In this stage, you doubt the facts, doubt your doubts and struggle to find
information about the change that you believe is valid. Resentment,
skepticism and blame cloud your thinking.
Stage 3 Discomfort to Motivation.

You will recognize Stage 3 by the discomfort it brings. The change and all it
means has now become clear and starts to settle in. Frustration and lethargy
rule until possibility takes over.
The Danger Zone.
The Danger Zone represents the pivotal place where you make the choice
either to move on to Stage 4 and discover the possibilities the change has
presented or to choose fear and return to Stage 1.
Stage 4 Discovery to Perspective.
Stage 4 represents the "light at the end of the tunnel." Perspective,
anticipation, and a willingness to make decisions give a new sense of control
and hope. You are optimistic about a good outcome because you have
choices.
Stage 5 Understanding.
In Stage 5, you understand the change and are more confident, think
pragmatically, and your behavior is much more productive. Good thing.

Stage 6 Integration.
By this time, you have regained your ability and willingness to be flexible.
You have insight into the ramifications, consequences and rewards of the
change

--

past,

present,

and

future.

In change the key individual is the leader; the key group is the
staff; the key process is teamwork; the key feeling is ownership. The
two basic types of organizational change are :

Participative
Directive

Participative: Participative change is bottom up change made by

educating the staff members and letting them share in the ownership of the
change. This type of change seems to work best with a staff that is relatively
high in ability and willingness. Participative change tends to be long lasting
and to have the strongest support of the staff after all, it's their idea. The
major disadvantage is that it is slow to occur.

Directive: Directive change is top down change imposed on the staff from
the leader or other higher external force. For example, the leader, without
warning, may say to the staff, All expenditures, without exception, will be
cleared through me until further notice. This type of change works best with
a staff that is relatively low on the ability and willingness subdimensions.
Exceptions may be in emergency situations where rapid change is needed.
For directive change to be effective, the leader must have sufficient position
power (coercive, connection, reward and legitimate power) to enforce the
change. A disadvantage of this type of change is that it requires the
presence of the leader to maintain it and often results in dissension among
the staff.
Before the leader begins to make any changes, he should be aware that
there will probably be a resistance to the change, especially if the staff's
perception of its current state is good. The larger the staff, the greater the
difficulty in bringing about the change. There are various reasons for
resistance to change, but the most common is that change is disruptive to
the established patterns of operation. A great deal of security is obtained
when an individual learns the rules of operating in a particular structured
system. When the rules change and personal security is reduced, fear
develops. An extra effort is required on the part of the individual to learn the
new rules.

The staff members may have strong vested interests in the current method
of staff operation. Quite often, changes are perceived as being made just for
the sake of change. Staffs, like individuals experiencing traumatic life
changes (terminal illness, etc.), go through the stages of
(1) denial that the change is necessary
(2) turmoil or anger
(3) bargaining
(4) depression
(5) acceptance.
Each of these stages results in a degradation of productivity.
To overcome resistance to change, the leader should consider the
following:

Recognize that the peer group will provide the major influence on willingness
to change. Involvement of the members of staff sections in planning
(participative change) and implementing the developmental plan will help
insure that staff members can see the vision and the payoffs for changing as
well as providing ownership in the change.

Change must be slow, incremental, sequential and progressive (previous

exceptions have been mentioned.)

The changes should appear positive and produce some immediately

recognizable payoff.

The changes should appear positive and produce some immediately

recognizable payoff.

Provide rewards and incentives for successes during the change period.

Maintain a healthy leadership climate.

Abandon a particular change that is not working after a reasonable amount

of time.
Organizational renewal refers to a continuous, knowledge-oriented process
as opposed to episodic change. Organizational renewal should encompass a
continuous process because of the changes that organizations face on a daily
basis, and many of those changes have the potential for major strategic and
tactical impact on an organizations operations. Such a continuous process
adds a stability factor even in the midst of episodic renewal. As depicted in
Figure 1, the triggers or root causes of changes may be internal and/or
external, and organizational leaders may have limited or no control over
some changes once they occur. However, awareness of a potential change
(or being the innovator who causes the change) would help mitigate the
extent to which there is leadership control or a lack of control.
Renewal is driven by a variety of forces. That process usually unfolds within
the context of a model we call the Renewal Cycle. This cycle spells out a
simple

four-step

explanation

The process starts with two axes.

The horizontal axis details the focus of change

internal or external. When companies increase their
focus on internal changes, they often cant focus as
well

on

external

concerns,

such

as

customer

satisfaction. Vice versa, when focus is trained

outside in the search for new markets, internal
processes tend to get lost in the shuffle.

of

change.

Meanwhile, the vertical axis relates to the size of change. An

organization with large-scale change taking place would be at the top;

one with no changes would be at the bottom.

The

axes

combine

to

create

four

quadrants,

which

we

have

named Gaming, Framing, Claiming, andTaming. Most of the time will be

spent in the fourth quadrant, Tamingthats where improvements are made
to the bottom-line, cost cutting, and performance improvement. Thats also
where most of the money is madethus people are usually loathe to move
out of it.

It usually takes something out-of-the-ordinary to force renewal. We like to call

this the catalytic event. In practice, the catalytic event is usually
traumatic, or at least threatening. A takeover, a new competitor, an
economic slowdown, even the death of a CEOall change your universe so
sharply that you cant go back to the old way no matter what. But having
been forced to make the leap, the company will then move through the
remaining three quadrants in a logical sequence, ultimately settling in a new
Taming environmentuntil the cycle starts again.