Managing Change

Salini C. Babu

Roll No: 18, MBA-IB

School of Management Studies
CUSAT, Kochi-22
E-mail: shalinibabu@yahoo.com

Abstract: This paper provides a general introduction to ‘Managing change’

in an Organization; definition and phases in change process; resistance to
change; and IT & managing change. It is presented as a seminar report.

Keywords: Change, definition, phases, organizational change, resistance to

change, managing change and role of IT.

1.0 INTRODUCTION
Change management is one of the most keenly studied management disciplines today.
Keeping in mind the fact that the organizations, which embrace change, are likely to be
most successful one. For this reason, many firms and institutions are alert to the need of
continually monitoring their structure and procedures with a view of improving them. This
article focuses not only on the change but the whole process of change – starting from the
introduction to the consolidation of change. Definition of change: “As a society, we have
been moving from old to the new. And we are still in motion. Caught between eras, we
experience turbulence.” - JOHN NAISBETT. Change is inevitable in the life of an
organization. According to Stephen P. Robbins- change is concerned with making things
different. Things must be different because they change constantly. Change can be
defined as – when an organizational system is disturbed by some internal or external
force, change frequently occurs. Change as a process, is simply modification of the
structure or process of a system. It may be good or bad, the concept is descriptive only."

Outside environment of the organization is ever changing, even socially and politically we
are always on the move, looking for newer and better ways of doing things. The industrial
revolution & shareholders and other stakeholders demand in an organization today also
presses the organizations to move. Added to this, the globalization and inter-cultural
exchange had made us even more susceptible to change than ever before. We are
becoming increasingly expected to adopt new techniques, due to the fast additions &
changes in technology and even in management theories and practices. Competition and
changing management focus also makes it inevitable. The strategic emphasis on cost
cutting and being innovative and competitive makes it even more important to be open to
change rather to resist it. Accepting change whether it is structural, operational, functional,
role oriented, compensatory or strategic is important.

Change is difficult to define because each organization will face its own challenges and,
therefore, its own rationale for change. Equally, each organization has differing resources,
company culture and personal dynamics. The leaders of individual organizations have
varying aims. Among all differences, one point remains intact and that is change is the
only permanent thing that modern day organizations of varying businesses, sizes and
ethnicity have to adopt in order to survive and sustain.

1.1 Why Organizations change?

Organizations change because of several reasons some of which are external to the
company & others are internal to it. The External causes can be some of the following:

1. Government policies
2. Changes in the economy
3. Competition
4. Cost of raw materials
5. Pressure groups
6. Technology push
7. Scarcity of labor
8. Social pressures
9. Legal requirements, etc

Internal causes can be such as following:

1. Change in leadership
2. Implementation of new technology
3. Decline in profitability
4. Changes in employee profile
5. Union actions
6. Low morale etc.

The organizational changes that are commonly seen in today's modern world are
Downsizing, Introduction/ implementation of new technologies, Mergers & acquisitions &
technological changes.

2.0 CHANGE AGENTS

Change Agent - the individual or group who undertakes the task of introducing and
managing a change in an organization. To succeed, they must be perceived as
trustworthy, be experts with proven track records, be similar to those they are working
with. The change agent can be internal or external. A person who leads a change project
or business-wide initiative by defining, researching, planning, building business support
and carefully selecting volunteers to be part of a change team. Change Agents must have
the conviction to state the facts based on data, even if the consequences are associated
with unpleasantness.
• A change agent lives in the future, not the present.
• A change agent is fueled by passion, and inspires passion in others
• A change agent has a strong ability to self-motivate.
• A change agent must understand people.
Who in organizations is responsible for managing planned change activities? The answer
is Change Agents. The term change agent is used in broad sense because a change
agent can be managers or non-managers, employees of organization or an outside
consultant. Terms such as OD Consultant, OD practitioner and Change Agent are used
interchangeably. For major change efforts, top managers are increasingly turning to
temporary outside consultants with specialized knowledge in theory and methods of
change.

2.1 Classification of Change Agents

Change agents can be classified into:

1. External Change Agents: These are outside consultants who are temporary employed
in the organization to remain engaged only for the duration of the change process.

2. Internal Change Agents: These are individuals working for the organization who know
something about its problems and have experience of improving situation in the same
organization. These Internal Change Agents, when assigned a responsibility of intervening
in a system come from entirely different department or division of their organization.

The difference between the two is clearly shown in Table 1.

Advantages Disadvantages
External Agent • Credibility as an • Perceived as an
Expert outsider
• No negative • Lacks knowledge
history with the of organization
organization. and it’s way of life
• Objective outsider • Often has limited
• Wide experience availability of time.
and diverse
knowledge.
 Internal Agent • Credibility as an • Often not
insider perceived as an
• Knows the OD expert.
organization, • May have negative
people culture etc. organizational
• Personal history.
relationship • May have limited
• Availability is OD experience.
ensured all the
time. • May lack
objectivity.
Table 1. External and Internal change agents.

3.0 TYPES OF ORGANIZATIONAL CHANGE

Organizational Change is broadly classified into ‘Planned Change’ - change resulting from
a deliberate decision to alter the organization and ‘Unplanned Change’ - change that is
imposed on the organization and is often unforeseen. While the external environment
(competitive, regulatory, and so on) will continue to play a role in an organization's ability
to deliver goods and services, the internal environment within the organization will
increasingly inhibit it from delivering products required to meet the demands of the
marketplace unless it is able to adapt quickly. The major areas of changes in a company's
internal environment include:
Strategic: Sometimes in the course of normal business operation it is necessary for
management to adjust the firm's strategy to achieve the goals of the company, or even to
change the mission statement of the organization in response to demands of the external
environments. Adjusting a company's strategy may involve changing its fundamental
approach to doing business: the markets it will target, the kinds of products it will sell, how
they will be sold, its overall strategic orientation, the level of global activity, and its various
partnerships and other joint-business arrangements.

Structural: Organizations often find it necessary to redesign the structure of the company
due to influences from the external environment. Structural changes involve the hierarchy
of authority, goals, structural characteristics, administrative procedures, and management
systems. Almost all change in how an organization is managed falls under the category of
structural change. A structural change may be as simple as implementing a no-smoking
policy, or as involved as restructuring the company to meet the customer needs more
effectively.

Process-oriented: Organizations may need to reengineer processes to achieve optimum

workflow and productivity. Process-oriented change is often related to an organization's
production process or how the organization assembles products or delivers services. The
adoption of robotics in a manufacturing plant or of laser-scanning checkout systems at
supermarkets is examples of process-oriented changes.

People-centered: This type of change alters the attitudes, behaviors, skills, or

performance of employees in the company. Changing people-centered processes involves
communicating, motivating, leading, and interacting within groups. Changes include:
investment in training, socializing employees, changing norms to motivate a diverse
workforce, monitoring promotion and reward systems, and changing top management.
This focus may entail changing how problems are solved, the way employees learn new
skills, and even the very nature of how employees perceive themselves, their jobs, and the
organization. Some people-centered changes may involve only incremental changes or
small improvements in a process. For example, many organizations undergo leadership
training that teaches managers how to communicate more openly with employees. Other
programs may concentrate on team processes by teaching both managers and employees
to work together more effectively to solve problems.

Technological change: requires that organizations learn how to manage the innovation
process. Technological capabilities provide new products, change existing ones, and
create a core competence. Improving the reliability and quality of goods and services is an
important capability. Organizations may need to restructure to achieve the benefits of new
technology.

4.0 RESISTANCE TO CHANGE

People are generally resistant to change. The challenge of the unknown is often less
palatable than the comfort of the familiar. When the human constituents of the
organization are faced with adopting new ways of doing things, it is not surprising that they
can be uncooperative. It is said that 'Most People Resist Any Change That Doesn't Jingle
in Their Pockets'. Sources of resistance to change may be rational or emotional, but the
fact remains that resistance if not taken care at the early stage con cause major problems
to the organization as well as in the implementation of the change, as rightly quoted by
Maurer asserts, "resistance kills change".

Organizations evolve through periods of incremental or evolutionary changes. The major

work changes happening today are changes in organizational strategy, organizational
structure and design, technology and human resources. A change in organizational
strategy is an attempt to alter the organization's alignment with its environment. Because
of the rapid rate of all technological innovation, technological changes are becoming
increasingly important to many organizations. One major area of change involves
equipment, thus a change in work processes or work activities maybe necessary.

4.1 Why Resistance to Change?

Most people don't like change because they don't like being changed. When change
comes into view, fear and resistance to change follow – often despite its obvious benefits.
People fight against change because they:
• fear to lose something they value, or
• don't understand the change and its implications, or
• don't think that the change makes sense, or
• find it difficult to cope with either the level or pace of the change.3
Resistance emerges when there s a threat to something the individual values. The threat
may be real or it may be just a perception. It may arise from a genuine understanding of
the change or from misunderstanding, or even almost total ignorance about it.
The internal forces are mainly related to the organization's internal environment but some
internal forces might be reflections of external ones. All organizations will experience
change at one time or another. Obviously, expanding the boundaries of exchange and
cultural contact creates both opportunity and risk. The challenges for managers are to
adapt properly the culture and the strategy of their organizations to its current
environment. Determined managers follow up with plans for process improvement.
Managers look for enthusiasm, acceptance and commitment, but it gets something less.
Hence, communication breaks down, implementation plans miss their mark and results fall
short. This happens often enough that we have to ask why and how we can avoid these
failures. A change might threaten the self-interests of some managers within the
organization, potentially diminishing their power or influence. Managers so affected may
fight the change. To close those gaps managers should know how to face and overcome
resistance to change. Although there are no certain solutions, several techniques at least
have the potential to decrease or even eliminate this resistance. Participation is often the
effective technique for overcoming resistance to change. Employees who participate in
planning and implementing a change are better able to understand the reasons for the
change. Uncertainty is reduced, and self-interests and social relationships are less
threatened. Having had an opportunity to express their ideas and to understand the
perspectives of others, employees are more likely to accept the changes more gracefully.
Educating employees about the need for and the expected results of an impending change
may reduce their resistance. And if open communication is established and maintained
during the change process, uncertainty can be minimized.
Several facilitation procedures, which include making only necessary changes,
announcing those changes well in advance, and allowing time for people to adjust to new
ways of doing things, can help reduce resistance to change.
By approaching these phases systematically and creating explicit links between
employees' commitment and the company's necessary change outcomes, managers
dramatically improve the probability of attaining demanding targets.

In order to survive, organizations must adapt to fit their changing circumstances.

Organizational change may be necessary to maintain a competitive edge or adapt to
changing economic factors. Unfortunately, change within an organization is not always a
smooth process. Impediments to change exist at all levels, from the individual all the way
up to the organization as a whole. It is the responsibility of top managers to recognize the
source of this resistance and work to remedy it before it hampers the growth of the
organization (George & Jones, 2008).

Individual resistance to change is the easiest for managers to identify. Individuals often
feel threatened by organizational change because the fear the change will negatively
impact them. Individuals are naturally more concerned with their current circumstances
than that of the organization. They often fail to recognize the positive impact that change
will have on the organization. Finally, individuals tend to develop work habits that may be
impacted by the proposed organizational change. Bad habits are hard to break, but they
must be in order for the organization to advance. The insecurity that individuals feel
regarding organizational change can manifest itself in increased absenteeism and
employee churn. In extreme cases, individuals may take steps to prevent the change from
occurring (George & Jones, 2008).

Groups within an organization tend to develop shared behaviors that may be resistant to
change. Organizational change may alter the dynamics of the group culture and disrupt its
normal operation. A tightly knit group may have an overdeveloped sense of cohesiveness
that encourages organizational inertia. This cohesiveness may result in individuals actively
manipulating information in order to promote an anti-change mentality within the group.
Individual members of a group may begin to realize the inaccuracy of their opinions, but
the group cohesion will prevent them from acting on these realizations (George & Jones,
2008).

Finally, the organization as a whole may resist change. Organizational change may lead to
a change in the organization’s power structure. The resulting power struggle between
those losing power and those gaining it will result in organizational stagnation. Similarly,
the proposed change may assist one group in achieving their goals while resulting in
another group’s goals becoming more difficult. Large organizations with a divisional
structure may falter as divisions fail to recognize the benefit of change to the entire
organization. Organizations with strict organizational reporting or tall hierarchies tend to
resist change as individuals within the organization are not encouraged to find their own
solutions. Finally, change that cuts against the grain of the organization’s existing culture
or values will find little acceptance from those entrenched in it (George & Jones, 2008).

5.0 RESPONSE TO CHANGE

The first step towards managing change is to know the reasons why do people resist
change. Some of them can be- they Dislike of change: Discomfort with uncertainty;
Perceived negative effect on interests; Attachment to the established culture/ways of doing
things; Perceived bleach of psychological contract; Lack of conviction that change is
needed; Lack of clarity as to what is expected; Belief that the specific change being
proposed is inappropriate; Belief that timing is wrong.

Excessive change; Cumulative effect of other changes in ones' life; Perceived clash with
ethics; Reaction to the experience of previous changes; Disagreement with the way the
change is being managed, etc. in order to overcome the resistance few of the tactics can
be used such as Education and communication; Participation and involvement; Facilitation
and support; Negotiation and agreement; Manipulation and cooperation; Explicit and
implicit coercion etc. According to Scott & Jaffe, resistance is a phase that ends as
individuals begin to separate from the past & become more confident of their capacity to
play a role in the future that they face…the best strategy is to Use Participation to Reduce
Resistance to Change. Once people are convinced that change is necessary, and that the
change vision is the right one, its time to move forward with implementation and
consolidation of change. Response to change is as shown in the figure1.
 Introducing change

Resistance to change
Factors (Psychological,
social, personality)

Modifications &
Alterations

Gradual Acceptance to
change

Acceptance to change

Figure 1.

6.0 STEPS TO MANAGE CHANGE

Managing change effectively requires moving the organization from its current state to a
future desired state at minimal cost to the organization. Bateman and Zeithaml identified
three steps for managers to follow in implementing organizational change:

1. Diagnose the current state of the organization. This involves identifying problems the
company faces, assigning a level of importance to each one, and assessing the kinds
of changes needed to solve the problems.
2. Design the desired future state of the organization. This involves picturing the ideal
situation for the company after the change is implemented, conveying this vision
clearly to everyone involved in the change effort, and designing a means of transition
to the new state. An important part of the transition should be maintaining some sort
of stability; some things—such as the company's over-all mission or key personnel—
should re-main constant in the midst of turmoil to help reduce people's anxiety.
3. Implement the change. This involves managing the transition effectively. It might be
helpful to draw up a plan, allocate resources, and appoint a key person to take charge
of the change process. The company's leaders should try to generate enthusiasm for
the change by sharing their goals and vision and acting as role models. In some
cases, it may be useful to try for small victories first in order to pave the way for later
successes.
"Successfully changing an enterprise requires wisdom, prescience, energy, persistence,
communication, education, training, resources, patience, timing, and the right incentives,”
John S. McCallum wrote in the Ivey Business Journal. "Successfully leading and
managing change is and will continue to be a front-burner responsibility for executives.
Prospects are grim for enterprises that either cannot or will not change. Indeed, no
industry member is quite as welcome as the one that steadfastly refuses to keep up."

Seven Steps to Change

 STEP 1: Joint identification of business problems and their solutions.
It gives a Clear definition of the business problem. Problem identification answers the
question “Why must we do this?” It gives a motivation and commitment to change.
 STEP 2: Develop a shared vision of how to organize and manage for
competitiveness.
This is to develop a clear vision of an altered and improved future; how the change
will improve the business and how those improvements will benefit employees.
Be sure that people see vision as in their personal best interest.
 STEP 3: Identify the Leadership
Be sure that there is a visible leader and sponsor of change and Articulate their
conviction in the form of a credible and compelling vision
 STEP 4: Focus on Results, Not on Activities
Concentrate on things that will contribute directly and tangibly to bottom line
improvement.
 STEP 5: Start Change at the Periphery, then let it Spread to other units.
Changing an entire organization at once is much more difficult and less likely to
succeed.
 STEP 6: Institutionalize Success through Formal Policies, Systems, and Structures
Getting an organization to change requires risk-taking and effort by many people.
Policies that describe how work is to be done, through information systems

 STEP 7: Monitor and Adjust Strategies in response to Problems.

Unanticipated problems crop up as people move forward. Be flexible

7.0 CHANGE MANAGEMENT: AN IT SERVICE MANAGEMENT DISCIPLINE

Change Management is an IT Service Management discipline. The objective of Change
Management in this context is to ensure that standardized methods and procedures are
used for efficient and prompt handling of all changes to controlled IT infrastructure, in
order to minimize the number and impact of any related incidents upon service. Changes
in the IT infrastructure may arise reactively in response to problems or externally imposed
requirements, e.g. legislative changes, or proactively from seeking improved efficiency and
effectiveness or to enable or reflect business initiatives, or from programs, projects or
service improvement initiatives. Change Management can ensure standardized methods,
processes and procedures are used for all changes, facilitate efficient and prompt handling
of all changes, and maintain the proper balance between the need for change and the
potential detrimental impact of changes. Change management is responsible for managing
change process involving:
• Hardware
• Communications equipment and software
• System software
• All documentation and procedures associated with the running, support and
maintenance of live systems.

The goal of the Change Management process is to ensure that standardized methods and
procedures are used for efficient and prompt handling of all changes, in order to minimize
the impact of change-related incidents upon service quality, and consequently improve the
day-to-day operations of the organization.

8.0 CONCLUSION

Today change is the essential of survival and a way of carrying out your business. Every
business firm whether big or small has to change with time or it will perish. This change
along with it brings insecurities and pain that forces human beings or individuals to come
out of their comfort zones to zone of uncomfortable debate and this leads to resistance to
change. How effectively and efficiently the top management and leadership within the
organization address these issues and how well are they prepare to handle the resistance
will decide the faith of the organization and its success in implementing change. The
importance of good communication system and the role it plays in make change process
smooth and less painful can not be undermined.

9.0 REFERENCES
1. Management Information Systems- Kenneth C. Laudon & Jane P.
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