What is organizational change?

Definition and meaning

Organizational Change looks both at the process in which a company or any

organization changes its operational methods, technologies, organizational structure,
whole structure, or strategies, as well as what effects these changes have on it.
Organizational change usually happens in response to – or as a result of – external
or internal pressures.

It is all about reviewing and modifying structures – specifically management

structures – and business processes.

Small commercial enterprises need to adapt to survive against larger competitors.

They also need to learn to thrive in that environment. Large rivals need to adapt
rapidly when a smaller, innovative competitor comes onto the scene.

To avoid falling behind, or to remain a step ahead of its rivals, a business must seek
out ways to operate more efficiently. It must also strive to operate more cost
effectively.
Ever since the advent of the Internet, the business environment today has been
changing at a considerably faster pace compared to forty years ago. Organizational
change is a requirement for any business that wants to survive and thrive.

Organizational change – embrace it!

Change is something that should be embraced rather than feared. Only with change
will businesses be able to lay the foundations for long-term success.

According to Cambridge Dictionary, organizational change is:

“A process in which a large company or organization changes its working methods or

aims, for example in order to develop and deal with new situations or markets.”
Many people would disagree with Cambridge Dictionary’s description. They say the
definition should not limit organizational change just to something that happens in
large companies.

Organizational change drivers

An organization’s change drivers include:

The economic climate

The term ‘economic climate’ means the state of the overall economy, i.e., economic
conditions.

If there is a recession, a company may have to lay off workers; this requires
restructuring.

A merger or takeover also means total reorganization and changes in corporate

culture.

Corporate culture or organizational culture is a group of internal values and

behaviors within an organization.

Consumer demand & behavior

People’s lifestyles and how they shop, work, and spend their leisure times are
forever changing. Since the advent of the Internet, these changes have been
occurring at significantly faster rates.
If you run a business today and hope that the pace of change will slow down, you will
be in for a huge disappointment. Without change, your company will lose its
competitive edge. It will also fail to meet the requirements of what most of us hope
will be a growing base of loyal customers.

New technologies
New hi-tech systems and devices have completely changed how commercial
enterprises do business and interact with other entities in the marketplace.
Business models such as virtual collaboration and outsourcing are only possible
today thanks to the Internet and ultra-high-speed communications.

Without technological change, our business leaders would still be dictating

correspondence to human beings, who would then type them out and arrange for
them to be distributed to the relevant people – wasting an incredible amount of time
and resources.

The competitive marketplace

If a new rival comes onto the scene with completely different commercial behaviors,
the other players may have to adapt, especially if that competitor is successful in
gaining market share.

Rules and regulations (government policy)

When companies are faced with new legislation or rules imposed by the relevant
regulatory authorities, they need to do two things: 1. Comply with them. 2. Adapt so
that they may continue to thrive.

Types of organizational change

What type of organizational change a company requires or is going through varies,
depending on the person’s point of view.

A manager in technology may see it in terms of systems, tools, software, hardware,

etc. The CEO will invariably perceive change in terms of structure and strategy.

The operations manager, on the other hand, will mainly see it in terms of processes,
etc.

In the majority of cases, the change is so complex and intricate that nobody can
define it fully from a specific standpoint.

Below are some of the common types of organizational change. Bear in mind that
there is some or significant overlap between them:

Mission and Strategy

This is all about the company’s aims and goals and how it plans to accomplish them.
Hardly any change in an organization is not related to its mission and strategy.

Mission and strategy affect every part of a business. Therefore, any change in this
area has a company-wide impact.

Policies and Legal Agreements

Changing policies and legal agreements may be highly unpopular with customers
and the workforce.
Any change in this area, even a minor one, may have a significant impact on a
company.

Organizational Structure
The term refers to the hierarchy within an organization, which defines each job and
department, their function, and where they report to.

When two commercial enterprises merge, or one takes over another, there are major
structural changes. Sometimes the change may be minor, such as when a new team
is established.

Processes
This term refers to a collection of linked tasks which find their end in the delivery of a
product or service to a consumer.

Processes and tasks are commonly altered during organizational change. In some
organizations, changing or upgrading processes is ongoing or occurs on a regular
basis.

Personnel
Personnel means staff or human resources, i.e., the employees. It includes hiring,
firing, training, roles, responsibilities, and other changes related to the workforce.

Culture
Culture refers to the pervasive beliefs, values, and attitudes that characterize a firm
and guide its practices.

Any change in these areas can have a profound impact on every aspect of the
organization.

It can have an impact on, for example, productivity, compliance, and innovation.

Products
This is all about changes to products, and everything related to encouraging
consumers to buy them. Marketing and sales are an essential focus for most
organizations.

Knowledge
Knowledge supports every product, process, initiative, project, and program. Change
here refers to the knowledge assets of the company.

Knowledge assets are the information or skills within an organization that make it
more competitive or valuable.

Technology
Today, virtually every commercial enterprise is a kind of tech company.
Sometimes, a company makes changes to its technology infrastructure, automation,
systems, hardware, software, etc.

Integration
Integration includes synchronizing IT (information technology) and business cultures
and objectives, aligning technology with company strategy and goals.

In a company, integration is a reflection of how people are absorbing IT as a function

of the organization.

Virtually every change requires integration. We must align everything in a company

so that they support, compliment, and add value to each other.

Integration is usually the most complex type of change. When carried out
successfully, the whole company is clearly much more valuable than the sum of its
parts.
Experts say that a fundamental aspect of introducing planned changes into any
environment is to gain insights into how well they will be received by employees and
customers and implemented by the management, and how accurately the economic
climate today and tomorrow is perceived and forecast. Integrating technology across
every component of the company and responding adequately to any new rules and
regulations are crucial.

The study of organizational change

The study of organizational change, because of its very nature, covers some
different disciplines, including psychology, management, economics, political
science, and sociology.

There is no all-encompassing theory of organizational change that all experts refer or

adhere to. Rather, it consists of several distinct theories that nobody so far has
integrated.
Shawn Grimsley writes in study.com.

“The study of organizational change is interdisciplinary in nature and draws from the
fields of psychology, sociology, political science, economics, and management.”

“You will not find a grand, unified theory of organizational change. Instead, you will
find distinct theories that have not really been integrated to date.”

Organizational change – failure

Perhaps this is why, in most cases, when people implement organizational change, it
usually fails.

The key conclusion of a study – ‘Where Change Management Fails‘ – by Robert Half
Management Resources, which included 300 senior managers at US companies
with at least 20 workers, was that organizational change usually fails.

The study found that in the majority of cases, the failure occurs in the executional
phase. This is due mainly to broken or inadequate communication.

Forty-six percent of respondents said that most change-management efforts

commonly failed at execution. However, only 10% claimed it occurred during the
strategy development stage.

When asked what was most important when leading their company through a major
organizational change, the respondents said:

• Communicating clearly and often: 65%

• Clearly outlining the goals: 16%
• Delegating effectively: 9%

Executive Director of Robert Half Management Resources, Tim Hird, explained:

“Whether major or incremental, many companies are initiating changes, from

transforming their business models to updating business systems and looking for
ways to enhance productivity. While change is never easy for a company, it’s even
harder for employees.”

6 Types of Organizational Change,

Explained
1. Strategic change
Organizations implement strategic changes to their business to achieve
goals, boost competitive advantage in the market, or respond to market
opportunities or threats. A strategic change includes making changes to the
business’s policies, structure, or processes. The upper management and
the Chief Executive Officer often bear the responsibility for strategic
change.

Here are three examples of strategic change in an organization:

• Updating your mission as you grow

When companies first launch, the initial focus is often on lead generation
and client aquisition. However, once the company has an established
customer base, the focus could shift to upselling. When the main mission
changes, the company’s mission also needs to evolve.

• Innovation

Strategic change through digital innovation refers to using skills and

resources to develop new ideas or improve existing offerings in order to
meet customers’ new and changing demands. Focusing on innovation
often requires investing heavily in research and development activities and
the latest technology.

• Restructuring

Restructuring leads organizations to reorganizing aspects of their company

to survive a massive blow or to maximize their already profitable business.
Restructuring can result in downsizing or upsizing the workforce. For
example, during COVID-19, the tourism and hospitality sectors were the
two of the worst-hit industries in terms of employee lay-offs and losses.

2. People-centric organizational change

While all changes affect people, people-centric types of organizational
change include instituting new parental leave policies or bringing in new
hires. When implementing a people-centric change, the leadership must
bear in mind that employees will naturally resist change.

A people‐centric change requires transparency, communication, effective

leadership, and an empathetic approach.

Note:Many change management models, such as the Kübler-Ross Change

Curve and Satir Change Model, focus specifically on managing emotional
reactions to change.
Here are three examples of strategic change in an organization:

• New hire onboarding

Bringing on new team members requires effective onboarding and training,

which affect both the new hires and the established employees. You need
to start with communicating the reason for hiring new people to the team.

Are they going to lighten the workload? Will they fill in the skills gaps? How
will they integrate with the current team?

Be ready to answer the above questions and have a solid plan to avoid
negative reactions. Get ahead of concerns like the extra time it will take to
train the new employees on existing tools.

• Changes to roles and responsibilities

Job descriptions can evolve over time. Changes to an employee’s

responsibilities may require additional training or upskilling and
restructuring of teams. Of course, shaking up routines is a delicate process.
It’s essential to have a strategy for change implementation and
communication.

People like purposeful change. Communicating the value of the change is

essential. If you are adding a responsibility to someone’s role, the
employee will be more likely to receive the news well if they understand the
reason behind it.

Consider the following options for announcing the new responsibility:

Option A: “Starting next month, the marketing team will be required to use
Oracle to create monthly reports on email marketing efforts.”

Option B: “Oracle’s built-in analytics simplify the process of monitoring

email marketing efforts and running reports. Harnessing those analytics will
allow us to create detailed reports for clients and offer them more value.
Starting next month, the marketing team will be in charge of creating and
delivering reports to clients. ”

Which option do you think would be better received?

• Layoffs

If your company undergoes mass hiring or layoffs, forcing you to change

your internal operations and processes, the situation has to be dealt with by
keeping in mind its impact on both the laid-off and the remaining
employees’ morale.

Give your laid-off employees enough time to rehabilitate and move out of
the company without any financial or emotional turbulence.

On the other hand, the threat of layoffs might evoke fear and anxiety
among your remaining staff members, thereby affecting their morale and
productivity. Therefore, the leadership needs to be transparent with these
employees, communicate the reasons behind such drastic changes, and
answer any questions the employees might have regarding the change.

3. Structural change
Structural changes are changes made to the organization’s structure that
might stem from internal or external factors and typically affect how the
company is run. Structural changes include major shifts in the management
hierarchy, team organization, the responsibilities attributed to different
departments, the chain of command, job structure, and administrative
procedures.

Circumstances that lead to structural change include mergers and

acquisitions, job duplication, changes in the market, and process or policy
changes. These changes often overlap with people-centric changes as they
directly affect most, if not all, employees.

Here are three examples of strategic change in an organization:

• Mergers and acquisitions

Mergers and acquisitions are the most common cause of structural change.
For example, let’s say a company X decided to merge with a company Y.
As a part of that merger, duplicate departments are eliminated, employees
from both companies are reassigned to new positions, some employees
are terminated, new policies and procedures are created, and job functions
are realigned to fit the new company structure.

Eliminating role redundancies, redefining goals, clearly defining new roles

and responsibilities, and training on technology are all important parts of
managing change during mergers and acquisitions.

Lewin’s Change Management Model works well for mergers and

acquisitions because it focuses on creating a new status quo. It has three
steps: unfreeze, change, and refreeze.

After you unfreeze the current processes, you move on to change. This
step should be gradual. This is when the strategy is so crucial. Difficult
changes, such as eliminating redundancies, require continuous and open
communication. Encourage feedback and listen as much as you talk. Once
the changes are in place, you “refreeze” or solidify the change as the new
status quo.

• The creation of new teams or departments:

Structural change can also apply to smaller adjustments, such as creating

a new team. If you notice that a group of employees have a knack for
analytics, you might decide to create a separate team dedicated to
reporting.

However, the necessary shifting of personnel and duties could create some
tension. To streamline the process, justify the change with clear reasoning,
explain the benefits, and highlight the positives. It’s not about taking away
responsibilities – it’s about playing to each individual’s strengths.

• Changes to the company organizational chart:

Promotions and new roles call for updates to the organizational chart.
When moving people around, be sure to celebrate wins, like promotions,
and explain adjustments such as merged departments.

Structural changes influence how your company functions as a whole. It’s

never an easy transition, but solidifying the change as soon as possible can
help you avoid major issues down the line.

4. Technological change
The increasing market competition and constantly evolving technology lead
to technological change within organizations. Technology change often
involves introducing new software or system to improve business
processes. However, technology project goals are often improperly defined
and poorly communicated, which scares and frustrates your employees
and ultimately leads to resistance.

Technology change management is all about identifying new technology

and implementing a digital strategy for improved productivity and
profitability.

Here are two examples of technological change:

• Digital transformation

Digital transformation is defined as the integration of digital technology

across all business domains, resulting in fundamental changes to how a
business operates and delivers value to its customers. While technology is
the cornerstone of digital transformation, there is a human component of
change management that evolves along with your technology. This is why
change management must be the center of your digital transformation
vision.

Manage change with empathy and help your employees understand how it
can improve their work life. Also, it is important to allow your employees
appropriate timelines to adapt to not only the new technologies but also the
new agile, customer-centric, design-thinking mindset.

Furthermore, organizations must invest in digital technologies to manage

change initiatives. Leverage digital adoption platforms like Whatfix to
deliver effective employee upskilling and reskilling programs for your
employees.

A DAP helps you provide in-app guidance on different enterprise

applications through a variety of formats, such as step-by-step walk-
throughs, balloon tips, videos, and written guides. It also tracks the
progress of your change initiative and gather feedback from your team.

• Introduction of a new technology

Technology is designed to make our lives easier, but learning curves can
make technology-related changes tricky to implement. People generally
prefer to stick with what they know.
When introducing new technology, you must have a solid transition plan.
People want to know why the technology is necessary, what makes it better
than previous solutions, and how you will support them during the
transition.

For example, if you plan to switch from an outdated CRM to Salesforce,

start by justifying the change. Explain that Salesforce will allow the team to
manage leads while also engaging with current customers. Be sure to point
out key benefits, like keeping marketing, customer relations, and detailed
analytics all in one place.

You can build confidence in the change by explaining that the transition will
be supported by various change management tools that offer capabilities
such as in-app training, weekly check-ins, and an internal chat for handling
questions.

5. Unplanned change
Unplanned change is defined as a necessary action following unexpected
events. An unplanned change cannot be predicted but can be dealt with by
effective change management.

Here are two examples of unplanned change:

• Shift to remote work

Situations such as the unexpected mass shift of employees to remote work

due to the outbreak of virus requires efficient organizational change
management skills. Draft a well-defined change management strategy that
specifies the aim, goal, purpose, and direction you want the change to
follow. The strategy defines the features and characteristics of the change,
the timeframe, risks, limitations, and potential employee resistance.

Some essential strategies that companies can use to manage remote

employees during change include:

•
o Communicating more frequently and thoroughly to avoid
misunderstandings and assumptions.
o Having the tools and processes in place to boost virtual
employee engagement.
o Prioritizing learning and development to continuously upskill
employees on the latest technology via employee training
software.
 o Using change managers to help individual employees adapt to
the remote culture.
o Providing flexible working schedules for remote employees to
maintain a healthy work-life balance.
• Loss of critical personnel

An unplanned change can also take place if another company or a

competitor wooes away one of your most valued team members with an
exciting promotion, or higher salary. In the event of employee turnover in
critical roles, succession planning is the most effective way to minimize the
affect of such change.

A succession plan identifies critical positions, future staffing needs,

documenting and transferring key knowledge, and the people that could fill
these future roles within an organization – and helps develop action plans
accordingly.

6. Remedial change
Remedial changes are reactionary. This type of change occurs when a
problem is identified, and a solution needs to be implemented. As these
changes are designed to address an issue; they call for immediate action.

Reactionary change may not be ideal, but it’s inevitable. The benefit of the
remedial change is that judging its success is quick and simple with just
one question – was the problem solved or not?

Here are two examples of remedial change:

• Addressing customer communication issues

There is a huge difference between simply handling communication with

customers and having an effective communication strategy. If what you’re
doing isn’t working, you need to adapt quickly.

Gaming company Activision realized that each time they released a game,
customers had a lot of questions and feedback. Agents were prepared for a
surge of incoming calls, but Activision realized that their customers
preferred to go straight to social media. They had to change their process.

Activision used Salesforce to implement Marketing Cloud’s Social Studio.

Marketing Cloud automatically tracks relevant tweets and social media
conversations and uploads them to Service Cloud. Now, customers can
either be directed to self-service solutions or connected to a live agent.
“It’s an incredible change,” Tim Rondeau, Activision’s Senior Director of
Customer Care, told Salesforce. “We’re reducing costs and increasing
satisfaction at the same time.”

It’s easy to use stories like this one as a reason for a change, but don’t
forget to present answers to WIIFM and WDIMTM. If you were to announce
a similar change to your customer service team, you’d want to focus more
on how it affects them personally.

In this case, the WIIFM is that employees will spend less time on repetitive
questions. The WDIMTM is that they’ll need to be trained on Salesforce
Marketing Cloud.

• Providing more training for new hires

Highly inefficient processes often lead to remedial changes. You might

notice that new employees are struggling to learn internal tools and
software. As a result, they are running to established employees with
questions. Time is wasted, and everyone ends up frustrated.

In this case, the remedial change could include a combination of a user

onboarding program for application training, a company wiki or knowledge
base for basic company knowledge, and an onboarding handbook with
knowledge resources that promote self-guided learning.

Remedial changes begin with an issue and end with a solution.

It seems simple, but since these changes are reactionary, they can often
involve some trial and error. Quick action means you won’t have as much
time to plan or transition. The strategy comes into play through monitoring
the change. The remedial change is only successful if the identified
problem has been solved.

What Is Organisational Change?

(Benefits, Types And Reasons)
Organisational change is important for the growth or transformation
of a business. Change can be an exciting time for companies to
reevaluate their processes, improve corporate culture and maintain
long-term viability. Understanding why companies implement
change strategies can help you navigate fluctuating circumstances
in an organisation. In this article, we answer, 'What is organisational
change?', share some benefits of change for both organisations
and individuals, outline some common types of changes you can
expect in an organisation and explore some common reasons chan
What is organisational change?
The answer to 'What is organisational change?' can help you
understand the concept better. Organisational change is the
process through which a company undergoes any transformation
internally or externally. The change may occur after extensive
internal planning, or rather suddenly, because of unanticipated
external factors. It can cause major shifts in the structure, culture,
goals, operational processes, service offerings and technology
policies of a business.

The implications of organisational change may depend on the type

of change implemented, the extent of the transformation and
whether the change was slow or sudden. Depending on the nature
of the change, employees may display active or passive resistance
to it. Some changes may not affect the employees at all. How the
management executes the change may greatly impact how the
employees receive it. Whether the changes are sudden or take
place over a longer period of time, they can require the
management to adopt new policies and adjust to new differences
within the organisation.

What are the benefits of organisational change?

Implementing periodic changes within an organisation is an
effective way to ensure that the organisation can adapt to the
changing world and keep up with its competitors. As an employee,
adapting to changes in the workplace may feel uncomfortable at the
moment. But once you can overcome that challenge with a positive
attitude, you are likely to experience personal development and
become a valuable asset to the company. Here are some benefits
of organisational change for employees:
 more opportunity for skill growth
diversification of demographics and tasks
improved communication
increased opportunity for employee input and participation
more scope for innovation
opportunities for new roles and promotions
Here are some benefits of organisational change for a company:

new business opportunities

improved employee efficiency
better management styles
enhanced market relevance
better staff morale
more cohesive vision and values
higher functioning teams
improved processesge 5 types of organisational change
While there are many types of organisational changes, they mainly
come under these five categories:

1. Transformational
Changes that completely reshape business strategies and
processes and redefine a business are called transformational
changes. These are dramatic, large-scale changes that
fundamentally alter the organisation. They happen rarely and are
usually implemented when businesses pursue entirely different
products or markets, experience radical changes in technology, try
to revamp their business model because of extreme conditions or
keep up with rising supply demand.
Some common reasons for transformational change are leadership
change, unmatched competition, adverse market conditions,
business growth and decline in revenue. This type of change can
affect all sections of a company, from staff to management. Some
kinds of organisational changes brought about by transformational
change are:

Cultural change: It involves promoting new attitudes that better

express the company's core values or redefining its vision and
mission altogether. This transforms the work environment of the
organisation.
Structural change: This refers to changes in hierarchies and job
roles. Incorporating structural change may involve reorganising
departments, creating high-performing teams, adding employee
positions, revising job roles and assignments or promoting valuable
employees.
Personnel change: This happens when a company experiences
massive growth or downsizing. This involves mass hiring and
layoffs that significantly impact employee engagement and
retention.
Related: How To Be Flexible At Work: A Complete Guide

2. Transitional
In a transitional change, companies replace an existing procedure
with a new one for increased efficiency and performance. This may
involve switching from manual to automated production methods,
creating new products or services, implementing new technology
and updating long-held, outdated policies. Companies make these
changes periodically to remain competitive in their marketplace.

Transitional changes may happen during mergers and acquisitions,

policy changes and corporate restructuring. This type of change is
substantially disruptive, as it may impact relationships, job functions
 and culture and may involve substantial retraining. Transitional
changes usually result in the following kinds of organisational
changes:

Technology change: This comprises adopting new technology to

phase out old methods and keep up with technological
advancements. This may include automating jobs, introducing new
software platforms and designing new strategies for technological
processes.
Operational change: This might involve updating to a new process
or streamlining the existing process. Companies can implement
operational changes by introducing new technologies or products,
focusing on team building and improving employee communication.

Related: How To Keep A Positive Attitude: A Complete Guide

3. Developmental
This type of change involves the enhancement and correction of
existing systems without aiming for any radical changes. These are
slow, small-scale changes that focus on incremental improvement,
detecting deficiencies and building upon prior success. Some
examples of developmental changes can include updating payroll
procedures, improvement of existing billing and reporting methods
and refocusing marketing and advertising strategies. These minor
changes compound over time and produce positive returns for the
company, significantly increasing its market value.

Developmental changes are a sign that the company is committed

to improving itself to meet market demands and grow revenues.
These changes are easy to adapt to and happen most frequently.
Developmental change can be of the following types:

Anticipatory change: An organisation may take up this type of

change to better prepare for future shortcomings or opportunities.
 This is a strategy-oriented change, often involving prior data
analysis, surveys and customer outreach.
Remedial change: A company implements this type of change when
it identifies an unanticipated problem and executes a quick solution.
This can relate to a loss of talent, addressing customer
communication issues, introducing an employee training program or
creating a position to fix a recurring problem in the company.
Related: What Is Strategic Planning And How To Do It In 6 Steps

4. Proactive
Proactive changes are pre-planned changes that the company
undergoes to avoid a potential future threat or to capitalise on a
potential future opportunity. These are active attempts to alter the
workplace and its practices. This kind of change coordinates the
various parts of the system as a whole and addresses the
underlying forces creating symptoms.

Examples may include increasing production volume due to the

expected rise in customer demand or introducing employee benefit
schemes to improve employee retention. Any kind of
transformation, transition or development requires pre-meditation
and extensive planning. These are organised changes that are
economically feasible and allow the company ample time to
prepare.

5. Reactive
Reactive changes are unplanned transformations undertaken in
response to unexpected external factors when some threat or
opportunity has already occurred. Factors like a market crash or
boom, political shifts, war, disease outbreaks such as an epidemic
or pandemic, product or technological obsolescence, natural
disasters and accidents trigger reactive changes. These types of
changes cover a limited part of the system and only respond to
immediate symptoms.
This can involve scenarios such as controversy concerning the lack
of diversity in employee demographics or new business laws
implemented by the government. The only example of reactive
change is remedial change undertaken spontaneously to solve an
unforeseen problem. It is often chaotic and expensive and prompts
the company to act within a limited time.

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Some reasons for changes in organisations
Organisations transform and evolve because of either internal or
external factors or a combination of both. Here are some internal
and external reasons a company may undergo change:

Internal reasons
Companies may undergo organisational change because of issues
within the company, relating to staff, management, processes or
performance. Some of those reasons are:

change in leadership
change in vision and values
introduction of new technology
deficiency in the existing structure
poor employee performance
decline in revenue
need for variety or diversity in workplace demographics
high turn-over rate
company growth
 meeting a sudden crisis
organisational life cycle involving an expected sequence of
advancements
External reasons
Companies may undergo organisational change due to external
reasons. Some of those reasons are:

Nature of Organization

1. Structure of relationships :
Organization is a system of well-defined tasks and duties assigned to people along with
delegation of authority, responsibility and accountability. Delegation provides formal structure to
the organization. Constant interaction amongst individuals creates social relations helps and a
structure of informal organization.

2. Managerial function :
It is a function of management which integrates human and non-human (physical) resources for
achieving organizational goals. It is a function in itself and also helps in performing other
managerial functions. For planning, directing and staffing functions to be effectively performed, it
is necessary that they are effectively organized.

3. Ongoing process:
Organizing is a process which involves a series of steps, from determination of objectives to
accomplishment of objectives. It is a continuous process which requires management to
introduce changes (re-organization) in the way and organization works. Many organizations re-
structure their set-up every five to seven years.

4. Encourages teamwork :
Since the early times, people always lived in groups. With increase in size of these groups, it was
not possible for one person to accomplish the organizational task alone. The work, therefore, got
divided amongst people and each person co-ordinate his work with other. This required
organizations the group activities towards common goal. According to Louis A. Allen:
“Organization has enabled men to increase their teaches far beyond the dreams of the wealthiest
potentates of old by making effective use of a potent multiplier-meshing, power and mechanized
tools” Organization comes into existence when there are a number of persons in communication
and relationship to each other who are willing to contribute towards a common Endeavour.

5. Foundation of management :
Success of an institution depends upon its sound organization. Clear definition of jobs and their
division amongst members with clear identification of authority and res possibility is the
foundation of successful management. Unless there is clarity of who is responsible to whom, no
management can function effectively.

6. Goal-oriented:
Every organization is formed for some objective; profit or service. All organizational activities are
divided amongst members, departments are created. Work is co-ordinate and continuous
monition of activities is done to achieve the objective. The process of organization is, thus, a
goal-oriented process.

7. Adaptive to change:
Though organization structure provides stability to activities of members, it sis open to change.
Changes in the environment, internal or external, are incorporated into the organization structure.
This makes organization and ongoing process.

. history of the organization of work

history of the organization of work, history of the methods by which society
structures the activities and labour necessary to its survival. Work is essential in
providing the basic physical needs of food, clothing, and shelter. But work involves
more than the use of tools and techniques. Advances in technology, which will always
occur, help to extend the reach of the hand, expand muscle power, enlarge the
senses, and multiply the capacities of the mind. The story of work is still unfolding,
with great changes taking place throughout the world and in a more accelerated
fashion than ever before. The form and nature of the work process help determine
the character of a civilization; in turn, a society’s economic, political, and cultural
characteristics shape the form and nature of the work process as well as the role and
status of the worker within the society.

The world of work—comprising all interactions between workers and employers,

organizations, and the work environment—is marked by the constant adaptation to
changes in the technological, cultural, political, and economic environments. The
study of historical changes in the organization of work can perhaps lead to a better
understanding of the present problems—now on a worldwide scale—that accompany
ongoing technical, political, and economic changes. (See organizational analysis.)
Hence, this article employs both historical and current perspectives in order to
provide a basis for understanding work in today’s world and to consider possible
changes in the future.
Organization of work in preindustrial times
Prehistory
Organization of work may have begun before the evolution of Homo sapiens. Along
with tools, a more complex brain structure, and linguistic communication,
the division of labour (job specialization) may have been responsible for starting the
human conquest of nature and differentiating human beings from other animal
species.

In the earliest stages of human civilization, work was confined to simple tasks
involving the most basic of human needs: food, child care, and shelter. A division of
labour likely resulted when some individuals showed proficiency in particular tasks,
such as hunting animals or gathering plants for food. As a means of increasing the
food supply, prehistoric peoples could organize the work of foraging and hunting
and, later, agriculture. There could be no widespread geographic division of labour,
however, because populations were sparse and isolated. The uncertain availability of
food allowed little surplus for exchange, and there were few contacts with groups in
different places that might have specialized in obtaining different foods.
Age, sex, and class
The most obvious division of labour arose from differences in age and sex. The oldest
people in the tribe lacked strength and agility to hunt or forage far afield and so
performed more-sedentary tasks. The very youngest members of the tribe were
similarly employed and were taught simple food gathering. The sexual division of
labour was based largely upon physical differences, with men taking on tasks such as
hunting while women specialized in food gathering, child rearing, and cooking.

The earliest human groupings offer no evidence of a division of labour based

upon class. The challenges of providing food made it necessary for the whole group
to contribute, so there could be no leisure class or even a class of full-time specialists
producing articles not directly related to the food supply. There were, however, part-
time specialists; a person who excelled at fashioning flint tools and weapons could
produce enough to trade any surplus for food.

Communal organization
Throughout human history, work has often required organization. Capture of game
and fish required varying degrees of cooperation among members of the group.
Communal activity of this type had important social implications. Food had to be
equitably distributed, and a leader was needed to organize and direct the group.
Because the basic social group was the family tribe, kin relationships—from the tribal
chief down—formed the basis for the “managerial hierarchy.” Bones of large animals
killed by hunters have been found in sites of the Upper Paleolithic Period (about
40,000 BCE to about 10,000 BCE), indicating a high degree of organization in hunting
at this early stage of the human race. Shortly thereafter men began using dogs to
assist with hunting.
Pottery
A more complex organization of work came with the development of pottery. While
some sort of clay adequate for making passable pottery can be found nearly
everywhere, the best potter’s clay is not universally distributed. Thus, people in some
locations were able to make pottery products that could be traded elsewhere. Skilled
workmanship and specialized tools aided production, perhaps further encouraging
specialization. There is no conclusive evidence that the earliest potters spent their
full time at that task or that pottery making was carried on by women in its earliest
stages (before introduction of the potter’s wheel). There is reason to believe,
however, that in prehistoric times some organization of the work existed. In some
societies, for instance, the gathering of the clay and firing materials may have been
the work of the men, while the women may have fashioned and decorated the pots.
Textiles
The same type of specialization might also have been involved in the making
of textiles. Early protective garments were derived from animal skins. The
development of agriculture reduced the supply of available skins and required a
substitute material for clothing. To make textiles, yarn had to be spun; the earliest
apparatus for this work consisted of a spindle and a distaff (a forked stick holding the
unspun fibres).
Agriculture
The assignment of tasks in primitive agricultural societies may have involved a
division of work along sexual lines, with the fields entrusted to the women while the
men hunted (although men would have helped with the more physically demanding
tasks such as clearing land). Because crop cultivation began as a part-time means
of supplementing the food source, there was little likelihood of full-time
specialization in primitive agriculture. Yet even in its earliest stages agriculture was
significant to the organization of work, for it provided a slight surplus that could be
used to support human society’s first real specialists: makers of metal tools and
weapons.
Metallurgy
Although the origins of metallurgy are as yet unclear, the development and use
of copper tools and weapons created a new organization of work in which some
persons devoted their full time to mining, smelting, and forging (see Bronze Age).
Although deposits of flint for stone tools and weapons were fairly widely and evenly
distributed, copper ores were not. Some of the earlier copper artifacts and remains of
early copper mines have been found in areas where climate and topography most
likely prevented agricultural development. Geography thus made it difficult for the
earliest miners and metalworkers to cultivate crops. Besides, the techniques of
prospecting, mining, smelting, casting, and forging were probably so demanding of
physical strength and mental concentration as to preclude the metallurgist from
farming or hunting activities.

Because copper ores are generally located in mountainous regions, the metal had to
be transported to its lowland users. The specializations of mining and metalworking
could evolve only after cultivation efforts created yields that could exceed subsistence
levels. Thus, metalworkers and their families were supported by the surplus
foodstuffs of farmers. Not surprisingly, metallurgy developed first near the farming
valleys of the great river systems of the Nile, Tigris-Euphrates, and Indus, all of
which provided a high yield of foodstuffs per acre. If metalworkers pursued their
occupations full-time, then it is likely that other craft specialties developed in a
similar manner. The combination of agricultural surpluses with copper and bronze
tools provided the basis for development of the great irrigation civilizations of
the Middle East. There the organization of work developed along lines that remained
unchanged for the next 5,000 years, until the beginnings of mechanization
and industrialization in the 18th century.
The ancient world
In his seminal book Oriental Despotism (1957), historian and political scientist Karl
Wittfogel presented a general theory of the development of ancient civilizations. He
found examples of large-scale systematic organization of work, the emergence of
social classes, and widespread specialization. Wittfogel believed that the
development of irrigation projects in such areas as Mesopotamia and Egypt led to the
use of mass labour, to an organizational hierarchy for coordinating and directing
these activities, and to government control for ensuring proper distribution of the
water. (See hydraulic civilization.) Though tribal societies had some form of
government, this was usually personal in nature, exercised by a patriarch over a
tribal group related by various degrees of kinship. Now, for the first time, an
impersonal government as a distinct and permanent institution was established.

Irrigation increased the food supply, allowing larger numbers of people to

agglomerate into towns and cities. Because farmers were vulnerable to attack, armies
were needed; this created the development of an officer class. Town specialization of
labour brought the emergence of potters, weavers, metalworkers, scribes, lawyers,
and physicians, while the new surpluses also created the basis for commerce. The
more complex economy created a need for record keeping, so writing—of which the
first examples come from the bookkeeping records of the storehouses in ancient
Mesopotamia—was born.

Wittfogel’s theory has been modified by scholars who point to urban civilizations that
lacked large-scale irrigation works. In their view, several factors, including
geographic features, natural-resource distribution, climate, kinds of crops and
animals raised, and relations with neighbouring peoples, entered into the response to
the environment. (The work of these scholars represents a “systems” approach to
defining the origins of organized societies.)

Social classes
In any case, by the time written history began, distinct economic and social
classes were in existence, with members of each class occupying a certain place in the
organization of work. At the apex of the social pyramid stood the ruler (often
worshiped as a divinity in Mesopotamia and Egypt) and the nobles (probably grown
out of a warrior group that had subjugated its neighbours). Closely aligned with them
were the priests; possessing knowledge of writing and mathematics, the priests
served as government officials, organizing and directing the economy and overseeing
clerks and scribes. The traders and merchants, who distributed and exchanged goods
produced by others, were below the noble-priest class in the social pyramid. A sizable
group of artisans and craftsmen, producing specialized goods, belonged to the lower
economic classes. Even lower in the social hierarchy were the peasants, and at the
bottom of the social scale were the slaves, most likely originating as war captives or
ruined debtors. The social structure in Classical Greece and Rome followed these
lines. For relatively short periods of time, some democracies did away with the ruling
group, substituting a class of free landholders and providing a citizen army of
warriors, but the basic economic organization remained unchanged.

Certain characteristics of the ancient organization of work emerged from the social
stratification described above. Chief among these was the hereditary nature of
occupations and status. At certain times and places—in the later Roman Empire, for
example—heredity of occupation was enforced by law, but tradition was usually
sufficient to maintain the system. The social structure remained remarkably stable
and was reinforced by the organizations of workers engaged in the same occupation.
These groups—some voluntary and some required by law—can be viewed
as prototypes of the medieval guilds.
Agriculture
The family farm
The basic agricultural work unit in the ancient world was the family. Even in certain
regions where the state owned the land, farms were allocated by family.
Furthermore, when large farming estates were formed during the Roman Empire,
the structure of rural society was little affected, because the owners commonly left
cultivation of their land to peasants who became their tenants.

Work within the family farm unit often was divided along sexual lines: the men
commonly bore chief responsibility for such seasonal tasks as plowing, sowing,
tilling, and harvesting, while the women cared for children, prepared food, and made
clothing. If slaves were available, their work was similarly divided. During planting
and harvesting seasons, the entire family performed fieldwork, with sons and
daughters entering into an apprenticeship under their parents. Technology also
influenced work organization. The usual draft team in antiquity—a pair of oxen—
required two operators: a driver for the team and a guide for the plow.
Estates
In the large estates, or latifundia, of the Roman Empire, the complex organization of
work resulted in the creation of a hierarchy of supervisors. The Greek
historian Xenophon (5th–4th century BCE) and the Roman statesman Marcus
Porcius Cato (3rd–2nd century BCE) wrote handbooks for the management of such
estates. Cato also outlined the work organization for a medium-sized farm. For an
estate of 150 acres (60 hectares) with olive trees, he recommended one overseer, a
housekeeper, five farmhands, three carders, a donkey driver, a swineherd, and a
shepherd. To these 13 permanent labourers, Cato recommended the hiring of extra
hands for the harvest period.
On the larger latifundia that developed from about the 2nd century BCE, the owner
was usually nonresident, often because he had many scattered estates. Direction of
the affairs of each was left in the hands of a bailiff under whose command slaves,
numbering in the hundreds or even in the thousands, were divided into gangs
charged with specific duties.
Crop specialization
Ancient agricultural work was also characterized by specialization in crops: vineyards
and olive groves were concentrated in Greece and Italy, while cereals
were cultivated in the richer soils of Sicily, North Africa, and Asia. Wine and oil
required craftsmen to produce amphorae for storage and conveyance, as well as
tradesmen and small sailing vessels for transport.
Crafts
Economic growth, sophistication of taste, and enlarged markets ultimately
brought mass production of a sort, with large workshops dedicated to the production
of a single item. These workshops, however, never achieved the size of even a small
modern factory; a building in which a dozen persons worked was considered a large
factory, though a few workshops were larger.

The earliest specialized craftsmen were probably itinerant, gravitating to wherever

their services were in demand. As market centres developed, however, craftsmen had
less of a need to travel, because their products could be traded in these centres.
Eventually, market development and economic growth increased the number of
specialized crafts, fostered the organization of guildlike groups, and contributed to a
geographic division of labour, with members of one craft located in a special quarter
of a city or in one area of a country. In the pottery industry, specialization was carried
even further, with shaping, firing, and decoration sometimes done in separate
establishments and with workshops specializing in cooking pots, jars, goblets, and
funerary urns.

Slaves were put to work in a variety of areas, including the crafts workshops. The
chief examples of large-scale production by slaves were in mining and metallurgy, in
which the conditions of labour were harsh and the organization of work was highly
structured. In the silver mines at Laurium, in ancient Greece, the master miner
commanded three gangs of labourers. The strongest workers handled picks at the ore
face, weaker men or boys carried ore from the mine, and women and old
men sifted the ore-bearing rock. The miners worked 10-hour shifts (followed by 10
hours of rest) in dark and narrow passages with smoky lamps that made the air
almost unbreathable. Aboveground, the master smelter supervised the workshops, in
which the strongest men worked the mortar and the weakest the hand mill.
Metallurgical working of the ore was carried out by small units, because the small
leather bellows limited the size of the furnace. Metallurgy thus remained essentially a
handicraft.

After weapons and tools, the chief use of metal was for ornamentation. The
metalworker was more artisan, or even artist, than industrial worker, and in the
trade there were patternmakers, smelters, turners, metal chasers, gilders, and
specialized goldsmiths and silversmiths.
Large-scale building
The monumental public-works projects of the ancient world demonstrate a
remarkable degree of human organization in the absence of power and machinery.
The Great Pyramid at Giza, built about 2500 BCE, before the Egyptians knew the
pulley or had wheeled vehicles, covers 13 acres (5.3 hectares) and contains the
staggering total of 2,300,000 colossal blocks of granite and limestone weighing an
average of 5,000 pounds (2,300 kilograms) each. There exists no complete historical
or archaeological record of the exact methods of quarrying, transportation, and
construction of the pyramids, and what evidence remains is often contradictory.
Obviously, the need to organize the work on a systematic and rational basis was
superbly met. It is estimated that some 100,000 workers were involved over 20 years
in building the Great Pyramid, and the logistic problem alone, housing and feeding
this large army of workers, required a high degree of administrative skill.

The master builder, who planned and directed the erection of the pyramids and other
great structures, occupied a high position in society. Ancestor of the modern
architect and engineer, he was a trusted court noble and adviser to the ruler. He
directed a host of subordinates, superintendents, and foremen, each with his scribes
and recorders.

Although some slaves were employed in building the pyramids, most of the builders
were peasants, drafted as a form of service tax (corvée) owed the state and employed
when the Nile was flooding their fields. Workers were not regarded as expendable;
overseers and foremen took pride in reporting on their safety and welfare. In a record
of a quarrying expedition to the desert, the leader boasted that he had not lost a man
or a mule. The labourers were organized into gangs: skilled workers cut granite for
the columns, architraves, doorjambs, lintels, and casing blocks; masons and other
craftsmen dressed, polished, and laid the blocks and probably erected ramps to drag
the stones into place.

The Greeks and Romans used advanced organizational techniques in the building of
monuments. The Roman road network, aqueducts, public buildings, public baths,
harbours, docks, and lighthouses demanded exceptional skill in organizing materials
and workmen, implying in turn a rational division of labour among craftsmen.

Medieval farming and craft work

The organization of work and division of labour, which might be said to have reached
a peak during the Roman Empire, declined as the empire disintegrated. The social
and political fragmentation and economic decay of the late empire reduced most of
western Europe to small-scale, self-sufficient economic units. As this happened,
the market for specialized production disappeared until trade and town life revived
in the form of the new feudal society. The growth of interregional commerce
stimulated demand for specialized crafts that would serve growing markets.

Important technological innovations in agriculture, power, transportation,

metallurgy, and machines created new forms of specialization. The emergence of the
new burgher (middle) class, with rapidly growing wealth and breadth of enterprise,
provided the basis for a more rational management of production. These social forces
hastened the rise of industrialization.
Class structure
Social divisions, or class structure, in the medieval world reflected a division of
labour. The noble class essentially contributed to the organization of work. Because
they controlled the land, basic to production in this agrarian society, the nobles alone
possessed the wealth to purchase the products of artisans, to buy goods brought from
a distance, to acquire the weapons and armour made by metallurgists, and to
construct castles and fortresses. The lords also decided, in accordance with prevailing
custom, how the farmwork should be organized.

The clergy were both consumers and producers whose primary responsibility was the
spiritual care of their parishioners. The monasteries were self-sufficient agrarian
units that often produced a surplus for trade; indeed, the monks experimented in
improving farming techniques and in producing special cheeses and wines that were
sold outside the monastery. Finally, the great churches required specialists in stained
glass, bell founding, stonemasonry, wood carving, and other trades.

The bulk of the population comprised farmers of varying legal and social status. Most
were serfs bound to the plots of ground their ancestors had tilled and provided
services or goods to the lord of the manor, who extended protection in return. A few
inhabitants of the manor were tenant farmers, or sharecroppers, who rented land in
return for payments of a share of the produce. Fewer still were free farm labourers
who worked for wages. Slavery had all but disappeared. Because the manor was
practically self-sufficient, peasants of whatever status performed a variety of tasks
connected with their agricultural occupation.
Agricultural production
Four interrelated factors determined the work organization of medieval agriculture:
the economic self-sufficiency of the manor, the development of mixed agriculture
based on crops and livestock, such technological improvements as the heavy
wheeled plow and rigid horse collar, and the system of land tenure and division of
holdings. Each peasant household produced nearly everything it needed. Exceptions
included the use of a feudal mill or winepress for which the peasants paid not
in money but with a percentage of the crop being processed.

While stock raising and crop production had been separate enterprises in antiquity,
the two were combined during the Middle Ages in northwestern Europe. Livestock
was raised for use as draft animals and for food, and, because the yield of the
grainfields did not greatly exceed human requirements, stock was pastured on poor
land or harvested fields. Thus, a certain amount of land was reserved for pasturage,
and some villager, usually an older member of the community, became a herdsman.

Communal organization was favoured by the land-tenure arrangements and by the

way in which arable land was divided among villagers. In order to assure an equitable
apportionment, the land was divided into large fields. Each peasant held strips in
each field, meaning that the work of plowing, planting, and harvesting had to be done
in common and at the same time.
The wheeled plow, gradually introduced over several centuries, further reinforced
communal work organization. Earlier plows had merely scratched the surface of the
soil. The new plow was equipped with a heavy knife (colter) to dig under the surface,
thereby making strip fields possible. Yet because the new plow required a team of
eight oxen—more than any single peasant owned—plowing (and indeed all heavy
work on the manor) was pooled. Such a system allowed little room for individual
initiative; everyone followed established routines, with the pace of the work set by
the ox team.

The craft guilds

In contrast to the land-bound serfs, townspeople of the Middle Ages were free. Some
engaged in commerce and formed groups known as merchant guilds. The majority,
however, were small merchant-craftsmen, organized in craft guilds as masters (of
highest accomplishment and status), journeymen (at a middle level),
and apprentices (beginners). The medieval master was typically many things at once:
a skilled workman himself; a foreman, supervising journeymen and apprentices; an
employer; a buyer of raw or semifinished materials; and a seller of finished products.
Because medieval craftsmen employed simple hand tools, a workman’s own skill
determined the quantity and quality of his output. Apprentices and journeymen
underwent long periods of learning under the guidance of a more experienced
workman. When he could produce a “masterpiece” that met the approval of
the guild masters, the craftsman would gain full admission into the guild.

Craft guilds were organized through regulations. By controlling conditions of

entrance into a craft, guilds limited the labour supply. By defining wages, hours,
tools, and techniques, they regulated both working conditions and the production
process. Quality standards and prices were also set. Monopolistic in nature, the
guilds, either singly or in combination, sought complete control over their own local
markets. In order to attain and protect their monopoly, the guilds acquired a political
voice and in some locations achieved the right to elect a number of their own
members to the town council. In some towns, such as Liège, Utrecht, and Cologne,
guilds achieved complete political control. The 32 craft guilds in Liège, for example,
so dominated the town after 1384 that they named the town council and governors
and required all important civic decisions to be approved by a majority vote of their
membership.

Craft guilds reached their peak prosperity in the 14th century. Specialties had
become so differentiated that larger towns typically had more than 100 guilds. In
northern Europe, for example, at the beginning of the period, carpenters built houses
and made furniture. In time, furniture making became a new craft, that of joinery,
and the joiners broke from the carpenters to establish their own guilds. The wood-
carvers and turners (who specialized in furniture turned on a lathe) founded guilds
also. Those who painted and gilded furniture and wood carvings were also
represented by a separate guild.

This era of intense specialization was marked by a countermovement toward

amalgamation of different crafts—a tendency that reflected the growth of
the market and the desire of enterprising masters to expand their trading abilities.
This came at the expense of the handicraft function. As craft
differentiation proliferated, numerous crafts wound up producing the same or
similar articles. This stimulated competitive forces among craftsmen who needed to
assure themselves of raw materials and a market. Because of this, masters were
tempted to employ members of other crafts, and conflicts inevitably arose.

The same widening of the market led to differentiation of classes within a craft. As
the trading function grew more important, those who remained craftsmen fell into a
condition of dependence upon the traders. Eventually, merchant guilds—originally
representatives of traders only—absorbed the craft guilds.

The craft guilds also suffered a breakdown in structure. Because the masters sought
to retain the profits of the growing market for themselves, they made it increasingly
difficult for journeymen to enter their class, preferring instead to employ them
as wage workers. Apprentices similarly had little hope of rising to mastership. Thus,
the master-journeyman-apprentice relationship gave way to an employer-employee
arrangement, with the master performing the functions of merchant while his
employees did craftwork. Conditions for development of the early industrial system
rose out of the disintegration of this craft-guild system. The excluded journeymen
eventually became a class of free labourers who practiced their craft for wages
outside the town walls—and outside the limitations of the guild regulations.
Medieval industry
The putting-out system
Certain industries that were small at the outset of the Middle Ages grew to be quite
large in scale, and this growth influenced changes in the organization of work. The
most important of these was the wool-cloth industry.

For reasons of cost and availability, wool was the basic clothing material in western
Europe until the beginning of modern times. Linen and silk were too costly for any
large-scale use, and cotton was grown only in small volumes. The production
of cloth from wool involved several time-consuming steps: cleaning and carding
(straightening curled and knotted fibres sheared from the sheep), spinning the fibres
into thread, weaving the thread into cloth, shearing off knots and roughness, and
dyeing. All these processes could be carried on within a single peasant household, for
they required only simple apparatus and rudimentary skills. Typically, children
carded the wool, women operated the spinning wheel, and men worked the loom
shuttles.

The cloth produced by such crude tools and relatively unskilled workers was rough
but serviceable. Those above the peasant class, however, desired the more
comfortable and attractive clothing that was produced by skilled craftsmen. The
resulting demand for better textiles caused the industry to outgrow the peasant
household means of production. A new organization of work, called the putting-out
system, was instituted in which a merchant clothier bought raw wool, “put it out” to
be carded, spun, and woven into cloth, and then carried the cloth through the
finishing processes with the help of skilled craftsmen. Because the spinners and
weavers remained peasants, they also earned part of their living from the plots on
which their cottages stood, meaning that agriculture and industry were pursued as
something of an integrated enterprise. The man could work in the field while his wife
spun, and in winter the man helped with textile production. At harvest time every
hand was out in the fields, leaving the spinning wheels and looms temporarily idle.

The putting-out system differed from peasant household production in that the
merchant clothier, or entrepreneur, bought the raw wool and owned the product
through all stages of its preparation (the cottage workers still owned their own
spinning wheels, looms, and other tools). Thus, the peasant farmer came to work on
materials that did not belong to him. On the other hand, the work was performed at
home (known as the cottage system or domestic system) rather than in a factory, and
work proceeded at the worker’s pace. The merchant simply organized the work by
arranging the order and sequence of the various technical processes—he did not
supervise the workers’ actual performance. Nevertheless, the merchant clothier who
began putting out cloth came to control the entire production process. This
represented a step toward the industrial capitalism that emerged in the 19th century.
Advances in technology
Growth in the scale of commerce during the Middle Ages was coupled with advances
in technology. Both these phenomena helped transform the nature of work. Of
central importance were the applications of wind power and waterpower; these
marked the beginning of the replacement of human labour by machine power.
Starting in the late 10th century, waterwheels, long used for grinding grain, were
applied to many industrial processes that included tanning, olive pressing, sawing
wood, polishing armour, pulverizing stone, and operating blast-furnace bellows. The
first horizontal-axle windmill appeared in western Europe in 1185, and within a short
time windmills could be found from northern England to the Middle East.

The mechanization of the process of fulling (i.e., shrinking and thickening) of cloth
illustrates ways that technology changed the nature of work. Up to the 13th century,
fulling had been accomplished by trampling the cloth or beating it with a fuller’s bat.
The fulling mill invented during the Middle Ages was a twofold innovation: first, two
wooden hammers replaced human feet; and second, the hammers were raised and
dropped by the power of a water mill. Only one man needed to keep the cloth moving
properly in the trough, which was filled with water and fuller’s earth. The
mechanization of fulling also caused the cloth industry to relocate along streams,
often away from the established urban textile centres.

Perhaps the best example of specialization of labour in the Middle Ages is to be found
in the large-scale metal-mining industry in central Europe, as described by the
German scientist Georgius Agricola in De re metallica (1556), the leading textbook
for miners and metallurgists for nearly two centuries. In addition to
the Bergmeister (“master miner”), the chief mine administrator, there was
a hierarchy of clerical and technical personnel and a series of craftsmen and
mechanics specializing in different phases of the mining operation: miners,
shovelers, windlass operators, carriers, sorters, washers, and smelters. The mines
operated five days a week on a 24-hour basis, with the workday divided into three
seven-hour shifts and the remaining three hours used for changing
shifts. Animal power was used wherever possible, with teams of eight horses hitched
in pairs to turn windlasses and raise buckets of ore or drain water from the mine.
Agricola’s illustrations show many types of pumps for mine drainage: crank-
operated, treadmill-operated, and waterpower-operated. There were also suction
pumps of varying degrees of complexity. All were operated by specialized mechanics.

The bellows for mine ventilation were operated either by human and animal power
or by waterpower. Other mining processes were less mechanized and were carried on
much as they had been in antiquity. Ores brought to the surface were taken to a
sorting table on which women, boys, and old men separated the pieces by hand,
putting the good ores into wooden tubs to be carried to the furnaces for smelting.

Monumental construction
The mechanization that was changing the organization of work throughout
the medieval period was little apparent in the construction of castles, cathedrals, and
town walls. Technologies that involved in the lifting of weights, for instance, had
made little progress during the Middle Ages, and, because the freemasons declined to
handle large blocks of stone, the Romanesque and Gothic structures were built with
smaller stone blocks, nevertheless achieving grandeur in scale. The organization
of labour differed greatly from that employed in antiquity. These great monuments
were built by free labourers such as carpenters, glaziers, roofers, bell founders, and
many other craftsmen in addition to the stonemasons.

Much can be learned about the nature of medieval construction by studying the
records of these projects as well as the monuments that were built. For a long time it
was believed that medieval craftsmen, especially those engaged in the building of
cathedrals, were humble, self-effacing artisans who laboured piously and
anonymously for the glory of God and for their own salvation. Scholars have
dispelled this myth. Medieval builders often left their names or signatures upon their
work, and surviving records show names, wages, and occasionally protests over
wages. There was a high degree of individualism. The artisans were by no means
anonymous: historians have uncovered more than 25,000 names of those who
worked on medieval churches. It has since been concluded that the medieval
craftsmen were relatively free and unfettered when compared to their counterparts
in antiquity.

Directing the guild craftsmen was the master mason, who functioned as architect,
administrative official, building contractor, and technical supervisor. He designed
the molds, or patterns, used to cut the stones for the intricate designs of doors,
windows, arches, and vaults. He also designed the building itself, usually copying its
elements from earlier structures upon which he had worked, either as a master or
during his apprenticeship. He sketched his plans out on parchment. As
administrator, he kept the accounts, hired and fired the workers, and was responsible
for procurement of materials. As technical supervisor, he was constantly present to
make spot decisions and plans. In the largest projects he was assisted by
undermasters.
From the 16th to the 18th century
The proliferation of industry during the early modern period (immediately preceding
the Industrial Revolution) arose from four factors: (1) the growth of wealth, derived
partly from the influx of precious metals from the New World but also from
developments in commerce, banking, and the very concept of money, (2) the growth
of markets, (3) the introduction of new products, and (4) the development of new
technologies. These helped increase the scale of manufacturing industries
throughout Europe, which in turn prompted changes in the organization of work.

The growth in the size of the market was caused only partially by the geographic
explorations of the preceding era and subsequent colonization. Most of the new
demand for goods stemmed from the emergence of the new middle class
(or bourgeoisie)—a phenomenon that raised the standard of living for an enormous
population group and stimulated demand for quality goods. The markets also
benefited from the demise of small medieval feudalities, which eventually gave way
to larger political units—the royal kingdoms. When economic influence extended
over a larger jurisdiction, it tended to eliminate many of the local restrictions on
trade and commerce established by the previous smaller political units. Many new
products—including spices from Asia and sugarcane from the New World—were also
introduced into Europe, either directly, by the explorers, or indirectly, through
expanded trade with distant points. Increased demand paralleled the growing
affluence and new manners of European society. Handicraft production no
longer sufficed as a means of rising to the pinnacle of society, and, as a result, the
power and influence of the guilds declined.
Genesis of the factory system
Over time the nature of technological change shifted from the introduction of new
mechanical contrivances to developments in the application of power (primarily
water and wind) to old devices and—even more significantly—to the organization of
work that would allow production on a larger scale. This represented the start of
the factory system. The organization of commerce also changed rapidly. New
instruments in the fields of banking, insurance, and export marketing offered an
efficient means of making capital available for investment in industrial enterprises.

In Britain the development of commercial concentration—and hence of industrial

scale—was mainly the work of large companies or corporate bodies such as woolen
manufacturers, ironmasters, and hatmakers. Government encouragement was given
by means of special legislation, especially grants of monopolistic charters. In France,
however, the practice of mercantilism, a government-directed policy aimed at
increasing national wealth and power, meant that the government itself took an
active part in developing industries that were state owned and operated—among
them the Gobelins tapestry works and other manufacturers of furniture, porcelain, or
luxury items.

Although the state-run factories in France represented at least two of the essentials
of factory production—the gathering of large groups of workers in one place and the
imposition of disciplinary rules—they did not change the organization of work.
Because they produced small quantities of luxury goods, they operated as large
handicraft operations. Furthermore, despite their size, the French Royal
Manufactories did not possess the third prime element of a true factory system:
mechanization. The great historical change in the organization of work came in 18th-
century Britain with the onset of the Industrial Revolution, largely as the result of the
new technology of power-driven machinery.
Organizational Knowledge
What is Organizational Knowledge
Organizational knowledge is all the knowledge contained within an organization that
provides business value. Organizational knowledge resources include things like
product knowledge, intellectual property, customer communications, employee
handbooks, manuals, and lessons of success and failure. It is a living type of
information that is created, used, and shared by people (human capital). There are 4
main types of organizational knowledge: tacit, explicit, individual, and/or collective.

Tacit Knowledge
Abilities that are difficult to communicate or teach are known as tacit knowledge.
Often referred to as implicit knowledge or wisdom, it’s considered mostly
inaccessible. For example, “natural salespeople” have innate skills that can be
difficult to transfer to others. Because it’s difficult for competitors to duplicate, tacit
knowledge is essential to competitive advantage.

Explicit Knowledge
All knowledge that isn’t tacit or implicit, explicit knowledge is captured in documents
and other media, through oral or written language, or in any other tangible manner. It
can be expressed in words (or numbers) and is easily stored and shared by writing it
down and putting it into things like databases or manuals. Structural knowledge is
often explicit. Information contained in encyclopedias and textbooks are good
examples.

Individual Knowledge
Learning and knowledge in any organization begins with its individuals. Individual
knowledge includes the skills, learning, personal abilities, and communication
preferences that influence how a person prioritizes, seeks information, and otherwise
performs work tasks. An organization’s knowledge sharing culture determines how
effective individual efforts can be, particularly in employee motivation.

Collective Knowledge
The way in which knowledge is gathered, distributed, and shared amongst members
of an organization. It encompasses the rules, procedures, and processes which
guide how people communicate with each other and collaboratively use knowledge
for problem-solving.
Knowledge Organization
How an organization categorizes its knowledge assets. The importance of
knowledge organization is most evident in smarter workforces that are equipped to
make quick, informed decisions that benefit the organization. Activities in knowledge
organization include classifying, mapping, indexing, and categorizing knowledge for
easy storage, navigation, and retrieval. It is essential that knowledge is prepared in
such a way that it can be easily identified, understood, and accessed by users.
Organizational knowledge management is tied to organizational goals. It is the
orderly management of an organization’s knowledge assets for the purpose of
creating value and meeting strategic requirements. Good knowledge management
provides the right tools, culture, and structures to enhance employee learning and
productivity.
An organization’s accumulated intellectual resources in the form of ideas,
information, understanding, memory, capabilities, and cognitive and technical skills.

Organizational Knowledge Base

An organizational knowledge base is much more than a library of information. It is a
centralized repository that facilitates storage, organization, and sharing of
information. Used internally, it allows employees to collaborate and distribute all
company knowledge and information. Used externally, it provides customers with
a self-service resource where they can learn about products and services,
troubleshoot problems, and get answers to frequently asked questions.

Knowledge Sharing
Organizational knowledge sharing is an activity through which knowledge is
exchanged among people. It is supported by a knowledge management system that
contains the 4 types of organizational knowledge users can access to answer
questions and solve problems. A part of the way teams collaborate, knowledge
sharing can be defined as “people working smarter together.” Encouraging
organizational knowledge sharing helps produce greater business outcomes.

Organizational Knowledge Best Practices

Processes or methodologies that have proven to work well and produce good
results. Modern best practices in organizational knowledge sharing include educating
users on the benefits of other people’s experience, encouraging open and frequent
communication, and using a state-of-the-art knowledge sharing platform.
Organizational identity
Organizational identity is a field of study in organizational theory, that seeks the answer to the
question: "who are we as an organization?"[1][2] The concept was first defined by Albert
and Whetten (1985) and later updated and clarified by Whetten (2006),
According to Whetten (2006) the attributes of an organizational identity are central, enduring, and
distinctive/distinguishing (CED).

• Central attributes are ones that have changed the history of the company; if these attribute
were missing, the history of the organization would have been different.
• Enduring attributes are ones deeply ingrained in the organization, often explicitly
considered sacrosanct or embedded in the organizational history.
• Distinguishing attributes are ones used by the organization to separate itself from other
similar organizations, but can also set minimum standards and norms for that type of
organization.
An attribute of a company must satisfy all three of these requirements in order to be considered
an organizational identity.
Organizational identity often attempts to apply sociological and psychological concepts and
theories about identity to organizations.[3] As a research topic, organizational identity is related to
but clearly separate from organizational culture and organizational image (Hatch and Schultz,
1997).[4] It assumes a larger perspective than work identity (the identity individuals assume when
in a work-related context) and organizational behavior (the study of human behavior in
organizational settings).

Public Perceptions of Organizational

Organizational identity is formed by top leaders' establishment of the core values and beliefs that
guide and drive the organization's behavior. An organization's top leaders must be able to
answer the question "Who are we?" as an organization because it affects how they interpret
issues, identify threats, craft strategy, communicate about the organization, and resolve
conflicts.[5] Public perceptions are often swayed via media attention, while once a member of the
organization, an employee may have a completely different perception. Organizations use four
identity-building actions when identifying and discussing: storytelling, use of analogies, procuring
social evaluations and establishing alliances.

Managing Organizational Identity

According to the work of Albert and Whetten, the task of managing organizational identity is often
neglected until an organization reaches a point where it is unavoidable. This may happen in
situations when an organization has experienced significant growth, downsizing, or fostered
multiple identities that have become irreconcilable. When addressing this question, an
organization must undertake the task of identifying which of their aspects truly define themselves
and how they should react to those characterizations. This may result in various actions such as
setting an agenda to change an identity that has become negative, building on an identity to
promote growth or influence in a community, or deciding which aspects to preserve while making
budget cuts.[1]

Identity Change and Instability

Organizational identity is sometimes viewed as a social construction under constant creation
through interactions [7] between combinations of internal and external actors.[8][3] This view sees
organizational identity as unstable and changeable rather than enduring. [7][8] Identity instability is
theorized to be beneficial in allowing organizations to adapt to changing operating
environments.[7][8]
Gioia et al. theorize that the basic components of identity endure, but their meanings are
reinterpreted over time.[7] Internal actors can influence organizational identity through
reinterpretation of or disagreement with the stated or official identity. [8] Powerful members may try
to stabilize or officialize organizational identity, resulting in a tension between members with
different views of the organization. This tension may be expressed as identity instability. [8]
External factors can also cause change or contribute to identity instability. External perceptions
of the organization’s identity may contribute to change or instability when those perceptions
conflict with internal views of the organization’s identity.[7] Critical questions about the
organization from external actors[8] or critical evaluations of the organization[6][7] may also
contribute to identity change.
There are multitudes of external factors that may influence an organizations identity. For
example, a city with oppressive civil rights laws is likely to affect the diversity of an organizations
identity within its jurisdiction accordingly and vice versa. Factors such as competition also play a
major role in the identity an organization may assume. This is observable in the way that
companies often point out distinct characteristic in their products when compared to others that
may be almost entirely the same. For example, a burger chain may point out its antibiotic free
meat compared to its competitors.
Albert and Whetten theorized that certain parts of an organization's life cycle are important for
the formation or reformation of an organization's identity, such as the initial founding of the
organization, removal of an important element of the organization, completion of the
organization’s main goal, rapid growth or decline, mergers, or splits. [3]
Identity change can be used intentionally to guide organizational change.[7] For example, rather
than seeking to answer the question: "who are we as an organization?" an organization may ask
"is this who we want to be [as an organization]?"[7] Albert and Whetten identified three main paths
organizational identity may take over time:[3]

• Organizations may have a stable identity for the entire life of the organization.
• Organizations may make a permanent change in their identity at some point in the life of the
organization.
• Organizations may change their identity and then revert to their original identity.
Changes in an organizations identity often take years to manifest into observable results. This
can be attributed to many factors such as deeply rooted cultures in an organization and strong
leaders that are resistant to change. While an organization can quickly change its mission
statements and marketing techniques in the short term, altering the actual cultural interworking of
an organization to correlate with these new goals and images is usually much more of a long-
term project. It requires members to buy in to the organizations new goals and desired direction,
and for members who are unwilling to conform to either gradually retire or be pushed out of the
organization.

Managing Multiple identities

Much like individuals, organizations can often have multiple identities. This exists when there are
more than one conceptualization of what is central, distinctive, and enduring to an organization.
Multiple organizational identities may or may not be consciously held by organizational leaders
and can be holographic or ideographic.[1][9] Holographic being an identity that is universally
accepted throughout an organization, and ideographic being an identity that is assumed only in
one department or sub-group of an organization. The existence of multiple identities in an
organization can provide benefits such as increased flexibility when reacting to complex
environmental factors and greater appeal to multiple internal stake holders, or become negative
when identities conflict and cause inaction or inconsistencies. When addressing the task of
managing multiple identities there are two strategic concepts organizational managers should
address:[9]

• Identity Plurality- The multiplicity of identities within an organization.

• Identity synergy- How well multiple identities complement each other.
When addressing the plurality of identities in an organization a manager may evaluate the
significance and impact each identity has on an organization. If certain identities are not seen as
essential, they may be left unattended with intention of essentially letting go of the identity in
order to consolidate the ones that are more important in order to create a lower plurality of
identities. However, if each identity is seen as essential and necessary for adapting to different
environmental factors and stakeholders, managers may emphasize the need to attain a high
plurality of identities. When undertaking this task, managers must evaluate the amount of
resources and funding they have and what is practical to take on in terms of funding their
organizational approaches to obtaining and fostering their identities. [9]
When addressing the synergy of identities in an organization, managers must determine how
much interaction between differing identities is desirable and feasible. If it is essential for two
identities to cooperate with each other for the well being of an organization, a manager may seek
to create a high amount of synergy between the two. If two identities are not seen as essential or
productive when interacting with each other, a manager may seek to departmentalize each
identity within an organization to limit the amount of synergy between the two in order to reduce
conflict.[9]

Communication Management of Organizational Identity

Organizational Identity is to not simply be an organization that provides commodities and
services or to take stands on the salient issues of the day, but to do these things with a certain
distinctiveness that allows the organization to create and legitimize itself, its particular "profile,"
and its advantageous position [1].[10] Any number of companies can offer the same product to the
consumer, but it is the objective of communication to illustrate why one specific company should
have more sales, growth, and development than the others.

• Communication is both the problem in organizations success and growth, as well as the
solution when used effectively and efficiently.
• The ideal image of proper communication the public's perception, what is mainstream and
with the times.
• Today image is everything and how you communicate that publicly could lead to potential
beneficial or catastrophic events for organizations.

Ashforth and Mael's approach to Organizational

According to Ashforth and Mael, identity is communicated by intrinsic factors such as the
formation of identity, its relation to organizational culture and its projected image. [11] However,
identity never remains stagnant. It is undergoing constant adjustments, and is negotiated through
the narrative told by the company. This phenomenon is known as Narrative Design. Just as
narratives build organizational identity, identity itself is the basis of narratives and goes deep into
its conception. This is the new way to the self-opinion. These stories communicate the distinctive
values and attributes of the organization in a more or less subtle way. It is only when we
considered the notion of identity as a narrative that we can observe references to the history and
traditions of the organization. This narrative can also transform the internal organizational culture.
Depending on the narrative chosen by the organization, the management style of the company
will inspire different beliefs and social values.[12] By telling their stories themselves, organizations
have the power to control narrative storytelling. It is they who have the power to minimize their
present and past mistakes, which have had an impact on the public's perception of the
companies image.

Organizational Change
Why Do Organizations Change?
Organizational change is the movement of an organization from one state of affairs to
another. Organizational change can take many forms. It may involve a change in a company’s
structure, strategy, policies, procedures, technology, or culture. The change may be planned
years in advance or may be forced upon an organization because of a shift in the
environment. Organizational change can be radical and alter the way an organization
operates, or it may be incremental and slowly change the way things are done. In any case,
regardless of the type, change involves letting go of the old ways in which work is done and
adjusting to the new ways. Therefore, fundamentally, it is a process that involves effective
people management.

Organizational change is often a response to changes in the environment. For

example, both the United States Department of Labor and Organization for
Economic Co-operation and Development (OECD) estimate that the age of the
workforce is on the rise (Lerman & Schmidt, 2006). What does this mean for
companies? Organizations may realize that as the workforce gets older the types
of benefits they prefer may change. Work arrangements such as flexible work
hours and job sharing may become more popular as employees remain in the
workforce even after retirement. As the workforce rapidly ages, it also becomes
possible that employees who are unhappy with their current work situation will
choose to retire, resulting in a sudden loss of valuable knowledge and expertise
on the part of organizations. Therefore, organizations will have to devise
strategies to retain these employees and plan for their retirement. Finally, a
critical issue is finding ways of dealing with age-related stereotypes, which act
as barriers in the retention of these employees.

Technology
Sometimes change is motivated by rapid developments in technology. Moore’s
law (a prediction by Gordon Moore, cofounder of Intel Corporation) dictates
that the overall complexity of computer circuits will double every 18 months
with no increase in cost (Moore’s Law, 2008). Such change is motivating
corporations to rapidly change their technology. Sometimes technology
produces such profound developments that companies struggle to adapt. A
recent example is from the music industry. When CDs were first introduced in
the 1980s, they were substantially more appealing than the traditional LPs.
Record companies were easily able to double the prices, even though producing
CDs cost a fraction of what it cost to produce LPs. For decades, record
producing companies benefited from this status quo. Yet when peer-to-peer file
sharing through software such as Napster and Kazaa threatened the core of their
business, companies in the music industry found themselves completely
unprepared for such disruptive technological changes. Their first response was
to sue the users of file-sharing software, sometimes even underage kids. They
also kept looking for a technology that would make it impossible to copy a CD
or DVD, which has yet to emerge. Until Apple Inc.’s iTunes came up with a
new way to sell music online, it was doubtful that consumers would ever be
willing to pay for music that was otherwise available for free (albeit illegally
so). Only time will tell if the industry will be able to adapt itself to the changes
forced upon it (Lasica, 2005).

Globalization
Globalization is another threat and opportunity for organizations, depending on
their ability to adapt to it. Organizations are finding that it is often cheaper to
produce goods and deliver services in some countries compared to others. This
led many companies to utilize manufacturing facilities overseas, with China as a
popular destination. For a while, knowledge work was thought to be safe from
outsourcing, but now we are also seeing many service operations moved to
places with cheaper wages. For example, many companies have outsourced
software development to India, with Indian companies such as Wipro Ltd. and
Infosys Technologies Ltd. emerging as global giants. Given these changes,
understanding how to manage a global workforce is a necessity. Many
companies realize that outsourcing forces them to operate in an institutional
environment that is radically different from what they are used to at home.
Dealing with employee stress resulting from jobs being moved overseas,
retraining the workforce, and learning to compete with a global workforce on a
global scale are changes companies are trying to come to grips with.

Market Conditions
Changes in the market conditions may also create changes as companies
struggle to adjust. For example, as of this writing, the airline industry in the
United States is undergoing serious changes. Demand for air travel was affected
after the September 11 terrorist attacks. Also, the widespread use of the Internet
to book plane travels made it possible to compare airline prices much more
efficiently and easily, encouraging airlines to compete primarily based on cost.
This strategy seems to have backfired when coupled with the dramatic increases
in the cost of fuel. As a result, airlines are cutting back on amenities that were
taken for granted for decades, such as the price of a ticket including meals,
beverages, and checking luggage. Some airlines, such as Delta Air Lines Inc.
and Northwest Airlines Inc., have merged to deal with this climate, and talks
involving other mergers in this industry continue.

How does a change in the environment create change within an organization?

Note that environmental change does not automatically change how business is
done. Whether or not the organization changes in response to environmental
challenges and threats depends on the decision makers’ reactions to what is
happening in the environment.
Poor Performance
Change is more likely to happen if the company is performing poorly and if
there is a perceived threat from the environment. In fact, poorly performing
companies often find it easier to change compared to successful companies.
Why? High performance actually leads to overconfidence and inertia. As a
result, successful companies often keep doing what made them a success in the
first place. When it comes to the relationship between company performance
and organizational change, the saying “nothing fails like success” may be
fitting. For example, Polaroid Corporation was the number one producer of
instant films and cameras in 1994. The company filed for bankruptcy in less
than a decade, unable to adapt to the rapid advances in the 1-hour photo
development and digital photography technologies. Successful companies that
manage to change have special practices in place to keep the organization open
to changes. As a case in point, Nokia finds that it is important to periodically
change the perspective of key decision makers. For this purpose, they rotate
heads of businesses to different posts to give them a fresh perspective. In
addition to the success of a business, change in a company’s upper level
management is a motivator for change at the organization level. Research shows
that long-tenured CEOs are unlikely to change their formula for success.
Instead, new CEOs and new top management teams create change in a
company’s culture and structure (Barnett & Carroll, 1995; Boeker, 1997;
Deutschman, 2005).

Resistance to Change
Changing an organization is often essential for a company to remain
competitive. Failure to change may influence the ability of a company to
survive. Yet, employees do not always welcome changes in methods. According
to a 2007 survey conducted by the Society for Human Resource Management
(SHRM), resistance to change is one of the top two reasons why change efforts
fail. In fact, reactions to organizational change may range from resistance to
compliance to being an enthusiastic supporter of the change, with the latter
being the exception rather than the norm (Change management, 2007; Huy,
1999).
 Reactions to change may take many forms.

Active resistance is the most negative reaction to a proposed change attempt.

Those who engage in active resistance may sabotage the change effort and be
outspoken objectors to the new procedures. In contrast, passive
resistance involves being disturbed by changes without necessarily voicing
these opinions. Instead, passive resisters may quietly dislike the change, feel
stressed and unhappy, and even look for an alternative job without necessarily
bringing their point to the attention of decision makers. Compliance, on the
other hand, involves going along with proposed changes with little enthusiasm.
Finally, those who show enthusiastic support are defenders of the new way and
actually encourage others around them to give support to the change effort as
well.

Any change attempt will have to overcome the resistance on the part of people
to be successful. Otherwise, the result will be loss of time and energy as well as
an inability on the part of the organization to adapt to the changes in the
environment and make its operations more efficient. Resistance to change also
has negative consequences for the people in question. Research shows that
when people negatively react to organizational change, they experience negative
emotions, use sick time more often, and are more likely to voluntarily leave the
company (Fugate, Kinicki, & Prussia, 2008).

The following is a dramatic example of how resistance to change may prevent

improving the status quo. Have you ever wondered why the letters on keyboards
are laid out the way they are? The QWERTY keyboard, named after the first six
letters in the top row, was actually engineered to slow us down. The first
prototypes of the typewriter keyboard would jam if the keys right next to each
other were hit at the same time. Therefore, it was important for manufacturers to
slow typers down. They achieved this by putting the most commonly used
letters to the left-hand side, and scattering the most frequently used letters all
over the keyboard. Later, the issue of letters being stuck was resolved. In fact,
an alternative to the QWERTY named the Dvorak keyboard provides a much
more efficient design and allows individuals to double traditional typing speeds.
Yet the shift never occurred. The reasons? Large numbers of people resisted the
change. Teachers and typists resisted, because they would lose their specialized
knowledge. Manufacturers resisted because of costs inherent in making the
switch and the initial inefficiencies in the learning curve (Diamond, 2005). In
short, the best idea does not necessarily win, and changing people requires
understanding why they resist.