Andrea Jung CEO AVON

Organisational Change
Chapter 6 Leading Change
Copyright Barbara Senior, Organisational Change Lecturers Guide 2002
Introduction
Leadership is a familiar topic, and you may remember some concepts that you have studied on previous courses such as Managing Behaviour at Work
The chapter focuses on a particular application of. leadership which is the leadership of change. Leaders influence, and exert influence through, the informal subsystems of organisations. Inevitably, some material in the chapter reiterates some familiar theoretical concepts.
Ask yourself, What are the implications for change?
Objectives (1)
To: identify those characteristics which distinguish leadership from management;
discuss whether there is one best way of leading or whether leadership style and behaviour should vary according to the circumstances;
explain the possible relationship between organisational life-cycle theories and different leadership styles and behaviours;
Objectives (2)
To: assess the compatibility of different leadership approaches with different types of change situations; discuss the issue of resistance to change in terms of its implications for leading the processes of planning and implementing change.
Management and Leadership
Inter-personal roles Figurehead (rep., symbol) Leader (relational, motivator) LEADING Liaison (network-related) Informational roles Monitor (scanning) ADMINISTRATING Disseminator Spokesperson Decisional roles Entrepreneur (innovator) Disturbance handler (conflict resolution) FIXING Resource allocator Negotiator
Source: Mintzberg, H. (1973), The Nature of Managerial Work, Harper & Row.
Management and Leadership
Can someone be a manager but not a leader?
Can someone be a leader but not a manager?
Management
Management: takes place within a structured organisational setting and with prescribed roles; is directed towards the attainment of aims and objectives; is achieved through the efforts of other people; and...
uses formal systems and procedures.

Source: Mullins, L. Management and Organisational Behaviour, 5th edn., London, Financial Times, Prentice Hall Publishing. p.166.
Leadership
A leader shapes and shares a vision which gives pointers and direction to the work of others. Leadership involves unleashing energy, freeing, growing, and building. Leaders influence the direction of a group through:
structuring (framing) the situation. controlling group behaviour. personifying the group. helping the group achieve its goal and potential.
Leaders need willing co-operation of the followers.

Source: Coleman, J.C. (1969) quoted in Smith M. (1991) Analysing Organisational Behaviour,
Kotter on Management, Leadership

Creating agenda People Execution Planning, budgeting Organising & staffing Monitoring, controlling, rectifying Delivers on expectations Vision & direction Alligning and communicating Motivating & inspiring Innovation & change oriented
Outcomes
Approaches to Theorising Leadership

Two main approaches
One best way
Contingency
One best way - traits of leadership (i)

Intelligence * Having an extrovert personality Dominance * Masculinity Conservatism (Lord, De Vader & Allier, 1986)
One best way - traits of leadership (ii)

Drive * (achievement, ambition, energy, tenacity, initiative) Leadership motivation (personalised or socialised) Honesty and integrity Self-confidence * (including emotional stability) Cognitive ability (the ability to marshal and interpret a wide variety of information) Knowledge of the business (Kirkpatrick & Locke, 1991)
One best way - traits of leadership (iii)

Risk-taking * Assertiveness and decisiveness Achievement orientation Motivation Competitiveness (Dulewicz and Herbert 1996)
One best way - traits of leadership (iv)

Leadership traits relating in some ways to risk taking include: ability to cope with change and uncertainty creative thinking
drawing on intuition,
right brain thinking good use of tacit knowledge the intuitive-thinking type arts-based thinking imagination
able to handle messes or soft problems

One best way - traits of leadership (v)

Components of emotional intelligence self awareness self-regulation motivation empathy social skills (Goleman, 1998)
Attributes of hero leaders, change masters Kaleidoscope thinking Imagination Foresight
A Bad Way - unethical leadership
Narcissistic Controlling Manipulative Self-promoting
One Best Way ? - leader behaviour
Wright (1996) found that leader styles are typically a blend of the following 4 components. Is there an optimal mix? Concern for task (production-centred) Concern for people (person -centred) Directive leadership (autocratic) Participative leadership (democratic)
University of Michigan Studies
This style seemed to work best
Country Club Management
Team Management
The Managerial Grid
Organisation Man Management
Impoverished Management
AuthorityObedience
9,9 style is often best
One-best-way - transformational leaders
Transformational Leaders Make major changes to

organisational mission organisational structure political and cultural systems of the organisation
(Source: Bass, B.M. (1990) From transactional to transformational leadership: learning the vision. Organizational Dynamics, Winter, p.22)
One-best-way - transactional & transformational leaders
Transactional Leader Management by exception (active) * Contingent reward * Management by exception (passive) Laissez-faire Transformational Leader Charisma * Inspiration * Intellectual stimulation Individualised consideration
(Source: Bass, B.M. (1990) From transactional to transformational leadership: learning the vision. Organizational Dynamics, Winter, p.22)
Current state of expected subordinate effort
Heightened motivation to attain designed outcome (extra effort)
Normal expected subordinate performance

Subordinate performance beyond normal expectations
One-best-way - A third dimension of leadership behaviour
Andrea Jung, CEO of Avon Cosmetics

Contingency theories
These take account of the great variety of
situational influences on leader effectiveness

Tannenbaum and Schmidt Fiedler Hersey and Blanchard Path-goal
Quinn
Contingency Theory 1:
Tannenbaum and Schmidt

A continuum from boss centred to subordinate centred Appropriate position on the continuum depends on
Forces in the manager Forces in the subordinate Forces in the situation Nature of task/problem Organisational context
Jayne has little room to manoeuvre

Directive style of leadership Participative style of leadership
Jaynes room for manoeuvre
Jaynes preferences Subordinates preferences Task stucture Context
2. Fiedlers contingency theory of leadership

Fiedler believes leaders must be chosen to fit the situation
LeaderTask Member structure Relationships 1 2 3 4 5 6 7 8 Good Good Good Good Poor Poor Poor Poor Position Leadership power style
Structured High Structured Low Unstructured High Unstructured Low Structured High Structured Low Unstructured High unstructured low
Task-oriented style Recommended Person-oriented style Recommended Task-oriented style recommended
Contingency Theory 3: Hersey & Blanchards Situational Leadership
Leader: decreasing need for support and supervision
Situational Leadership (cont.) (Hersey and Blanchard)
Two Orientations
task behavior relationship behavior
Four Styles tell sell participate delegate
Situational Leadership (cont.) (Hersey and Blanchard)
Two Follower Readiness factors

ability (job knowledge, experience, and skills) willingness (psychological readinessconfidence, commitment, and motivation)
Four Levels of Follower Readiness unable, unwilling

unable, willing able, unwilling able and willing
Situational Leadership (cont.)

Effect of (Follower Readiness: Willingness and Ability)
Hi
Subordinates Willingness
Lo Subordinates Ability
Hi
Contingency Theory 4: Path-Goal Theory
Path-Goal: factors between effort & results

TEAM MEMBER CHARACTERISTICS
skill motivation locus of control Expectations that effort will bring desired rewards)
EFFORT
PERFORMANCE
job design
goal clarity
resources (tools, materials, information etc.)
time
NATURE OF TASK AND CONTEXT

Path-Goal Leadership Styles

1. Directive
Clarifies job duties, clarifies performance standards, ensures that procedures are followed
Same as task-oriented leadership 2. Supportive

Friendly, approachable, shows concern, respect Same as people-oriented leadership
3. Participative
Consults with employees, solicits suggestions Related to employee involvement practices
4. Achievement-oriented
Sets challenging goals, high confidence in employees, expects improvement Applies goal setting, positive self-fulfilling prophecy
Path-Goal Contingencies (summary)

Employee Contingencies
Skill/Experience Locus of Control
Directive Supportive Participative Achievement
low external
low external
high internal
high internal
Environmental Contingencies
Task Structure Team Dynamics
Directive
ambiguous neg. norms
Supportive
routine low cohesion
Participative Achievement
non-routine pos. norms ambiguous ?
Contingency Theory 5: Quinns Competing Values

The basic idea is that leadership styles should fit the overall organisational model. The organisational models are: The team: flexible but inward looking. Leader is a supporter, facilitator. The adhocracy: flexible and outward looking. Leader is an innovator, broker. The firm: stable but outward looking. Leader is task oriented, directive. The hierarchy: stable and inward looking. Leader is a monitor, co-ordinator.
Leadership in times of change
Leadership and the organisational life-cycle. (Greiner, 1972; Clarke & Pratt, 1985).
Leadership and the nature of change. (Dunphy & Stace, 1993).
Leadership and resistance to change. (Clarke, 1994).

Analysing and managing resistance to change. (Strebel, 1996; Beer, Eisenstat & Spector, 1990; Kotter, 1995).
Can one leader take the organisation through all its phases?
Styles will likely need to change as the organisation develops through the various phases. Some contingency theorists would say that it is theoretically possible for one leader to take the organisation through various phases.. Others (e.g. Fiedler) would say it is not possible.
Leadership and the Organisational Life Cycle (i) : Greiner, Clarke

.
Evolutionary Phase Appropriate Top of Organisation Management Style 1. Creativity Individualistic, entrepreneurial 2. Direction Directive, strong 3. Delegation 4. Coordination 5. Elaboration Delegation, gives autonomy Watchdog Participative, team oriented
Leadership and the Organisational Life Cycle (ii) : Clarke & Pratt
.
Evolutionary Phase Appropriate Top of Organisation Management Style 1. New business Champion 2. Exploitable market 3. Mature 4. Danger of decline Tank commander Housekeeper Lemon squeezer
Environmental conditions & types of change
- a recap of Chapter 2
ENVIRONMENTAL FORCES FOR CHANGE
Ansoff and McDonnell (1990) Predictable Forecastable by extrapolation Moderate Close to certainty Predictable threats and opportunities Partially predictable opportunities Modular transformation Corporate transformation Converging (incremental) Incremental adjustment Bumpy incremental Strong Far from certainty Unpredictable surprises Contained Strebel (1996) Weak Stacey (1996) Tushman et al. (1988)
TYPES OF CHANGE
Dunphy & Stace (1993)
Grundy (1993)
Stacey (1996)
Close to certainty
Converging (fine-tuning)
Fine-tuning
Smooth incremental
Closed
Discontinuous or framebreaking
Discontinuous Open-ended
Dunphy & Stace Change Matrix

.
Type of Change Enacted (following environmental forces for change)
Style of Change Mgt. Collaborative Consultative Directive Coercive
Fine Increm. Modular Tuning adjustment transform
Corporate transform
Type 1 Participative Type 2 Evolution Charismatic Transformation Type 3 Forced Evolution Type 4 Dictatorial Transformation
Forces for and against change

Leading change will inevitably also be concerned with overcoming resistance to change
Driving forces for change

external forces (e.g. constraints from suppliers, customer needs) internal forces (e.g. org growth, office politics, restructuring)
Driving forces against change

Individual resistance organisational resistance
Resistance to Change
The most likely response to a change proposal is a series of outraged objections, some relevant (for no proposer of change can have thought out all the implications), some irrelevant (just waiting for an opportunity to surface and using this one).
(Pugh, D. (1993) Understanding and Managing Change, in Mabey C, and Mayon-White, B. (eds.) Managing change, second edition, PCP).
Individuals reactions to change

+ Positives
Enthusiasm Opportunity Challenge Excitement New skills New knowledge Reward Fulfilment Survival New start Creates options Learning experience Motivation
- Negatives Fear Anxiety Shock Distrust Anger Stress Resentment Confusion Uncertainty Demotivation Depression Loss of self-esteem Loss of identity
- Negatives
Loss of peer group Letting go Saying goodbye Distraction Family disruption Insomnia Conflict Politics Stubbornness Critical reactions Mutiny Disown/Block Misunderstanding
Reasons for Adverse Reactions to Change

Loss of job Reduction of career prospects Down grading of work Effects in pay Loss of status - empires Reduction in responsibility or job interest Need to learn new skills New and unknown bosses New and known (!) bosses Break up of established work groups Transfer to new, unknown (known!) locations or departments
Underlying Reasons Why Individuals Resist Change

Perceived lack of new skills, loss of old Loss of power base
Fear of the Unknown
Loss of rewards
Dislike of uncertainty ambiguity
How People Resist Change Individual responses to threats and unknown dangers
rigidity doing more of the same but harder greater inadequacy aggression aggressive rigidity
Threat to Group Norm Inertia Structural Existing Group Built-in Power Bases Inertia
Sources of Organisational Resistance
Threat to Existing Resource Allocations
Entrenched interests
Cultural, mindset inertia
Why Organisations Resist Change
Organisations are coalitions of interest groups in tension
balance (ultra-stability, equilibrium) of forces hammered out over a period
Change
upsets this balance
Lewins Force-Field Theory of Change
Organisational change occurs when: forces for change strengthen restraining forces lessen, or both processes occur simultaneously
Steps in Force Field Analysis

1. Define problem (current state) and target situation (target state). 2. List forces working for and against the desired changes. 3. Rate the strength of each force. 4. Draw diagram (length of line denotes strength of the force). 5. Indicate how important each force is. 6. How to strengthen each important supporting force? 7. How to weaken each important resisting force? 8. Identify resources needed. 9. Make action plan: timings, milestones, responsibilities.
Assessing resistance to change Strebel

Look for closed attitudes. Look for an entrenched culture. Look for rigid structures and systems. Look for counterproductive change dynamics. Assess the overall resistance to change by:
examining to what extent the various forces of resistance are correlated with one another. describing the resistance threshold in terms of power and resources needed to deal with the resistance.
Responding to resistance to change
Strebels
contrasting change
paths
Beer,
Eisenstat and Spectors six steps to effective change & Schlesinger
Kotter
Possible Change Paths - Strebel

.
Resistance level Closed to change Can be opened to change Open to change Change force Proactive Reactive Rapid Downsizing & restructuring
Radical Org releadership allignment Top down experimentation Bottom-up experimentation Weak
Process re- Autonomous engineering restructuring Goal cascading Rapid adaptation
Moderate
Strong
Beer et als six steps to effective change

Mobilise commitment to change through joint diagnosis of business problems. Develop a shared vision of how to organise and manage for competitiveness. Foster consensus for the new vision, competence to enact it, and cohesion to move it along. Spread revitalisation to all departments without pushing it from the top. Institutionalise revitalisation through formal policies, systems and structures. Monitor and adjust strategies in response to problems in the process.
Source: Beer, M., Eisenstat, R.A. and Spector, B. (1993) Why change programs dont produce change, IN Mabey, C. and Mayon-White, B. (eds) Managing Change, London, P.C.P. Copyright Barbara Senior, Organisational Change Lecturers Guide 2002
Possible ways of dealing with resistance (Kotter & Schlesinger)

education & communication participation & involvement facilitation & support negotiation & agreement manipulation & co-optation explicit and implicit coercion
E (Economic) vs O (organisational capability) approaches to change

Economic Shareholder oriented Money incentives Layoffs Downsizing Restructuring Organisational Capability Softer Culture change Emphasis on individual & organisational learning

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Organisational Change

Chapter 6 Leading Change

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Ask yourself, What are the implications for change?

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Management and Leadership

Management and Leadership

Can someone be a manager but not a leader?

Can someone be a leader but not a manager?

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

uses formal systems and procedures.

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Leaders need willing co-operation of the followers.

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Kotter on Management, Leadership

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Approaches to Theorising Leadership

One best way

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One best way - traits of leadership (i)

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One best way - traits of leadership (ii)

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One best way - traits of leadership (iii)

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One best way - traits of leadership (iv)

able to handle messes or soft problems

One best way - traits of leadership (v)

A Bad Way - unethical leadership

Narcissistic Controlling Manipulative Self-promoting

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One Best Way ? - leader behaviour

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

University of Michigan Studies

This style seemed to work best

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Country Club Management

The Managerial Grid

Organisation Man Management

9,9 style is often best

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One-best-way - transformational leaders

Transformational Leaders Make major changes to

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

One-best-way - transactional & transformational leaders

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Current state of expected subordinate effort

Heightened motivation to attain designed outcome (extra effort)

Normal expected subordinate performance

Subordinate performance beyond normal expectations

One-best-way - A third dimension of leadership behaviour

Andrea Jung, CEO of Avon Cosmetics

Tannenbaum and Schmidt Fiedler Hersey and Blanchard Path-goal

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

Jayne has little room to manoeuvre

Jaynes room for manoeuvre

Jaynes preferences Subordinates preferences Task stucture Context

Copyright Barbara Senior, Organisational Change Lecturers Guide 2002

2. Fiedlers contingency theory of leadership

Task-oriented style Recommended Person-oriented style Recommended Task-oriented style recommended