333.

Organisational change and interventions

Unit 1

Forces of Change
1. External Forces
External forces include the following factors:
i) Technology: It is a major external force that calls for
change. Computer technology and automation have made a
remarkable impact on the functioning of organisations in
recent times Technological advancement is thus a permanent
fixture in the business world and it continues to demand a
manager's attention as a pressure for change.
ii) Marketing Conditions: Marketing conditions are not static
in nature. They are in the process of rapid change as the
desires, needs, and expectations of the customers change
frequently. Moreover, there is tough competition between
suppliers and manufacturers in the market. New media of
advertisement and advertising are being used for influencing
buyers. All these factors put great pressure on modern
organisations to change their technologies and marketing
strategies. 
iii) Social Changes: Because of the spread of education,
knowledge explosion and government efforts, social changes
are taking place at a fast speed. The aim for social equality
has posed new challenges for management. The
management has to follow social norms in shaping its
marketing, employment, and other policies
iv) Political Forces: Political forces that lie outside and inside
the country have an important influence on large business
houses, particularly transnational corporations. The
interference of government in business has raised
tremendously in most countries.
Many laws have been passed to control the movements of
the corporate sector. The organisations have no control over
the political and legal forces, but they have to adapt to meet
the pressure of these forces.

v) Globalisation: In today's open market economy, the power

players are multinationals or transactional in every country
across the globe. This has undeniably raised the level of
competition for every concerned party. Now to survive and
remain afloat, an organisation will have to compete not only
with orders in its own country but also with the best ones
from the world.

vi) Changing Economic Conditions: The constantly changing

economy has been very challenging for organisations in
recent years. The worldwide recession in the 90s required
the laying of working in almost every organisation.

Though for a brief period in the late nineties, there was

some improvement in the economy, the recent years
are again experiencing a downward trend. All these
have forced organisations to change their ways of
functioning.
vii) Governmental Forces: Governmental regulations and
also the extent of intervention may influence the need for
change. The following governmental forces have been
described below which determine the need for
organizational change:
1. Deregulation: Deregulation is associated with
decentralization of power or economic interventions
at the state level or lessening of the governmental
intervention in the economy. For example, as an
outcome of deregulation few sectors/industries like
insurance, banking, petroleum and many others
which were previously under the direct control of the
government, are now being handed over to the
private players or companies.
2. Foreign Exchange: Foreign exchange rates directly
affect the international trade, as the variations in the
exchange rates influence the currency payment
structure. Issues or constraints with the foreign
exchange rate may compel the government in
moving ahead with the imposition of import
restrictions on selected items or deregulating the
economies for attracting the foreign exchange for
investment purposes.
3. Anti-Trust Laws: Anti-Trust laws are enforced by
most of the governments for restricting/curbing
unfair trade practices. For example, these restrictions
have been enforced in India by enacting an act
called Monopolies and Restrictive Trade Practices
(MRTP), 1971.

Internal Factors
Internal forces include the following
i) Changes in Managerial Personnel: Changes in
organisations are quite fast when executives at the top
change. No two executives have the same philosophy and
style. The new executive will follow his style and will like to
put into practice his ideas and philosophy.
This may lead to important changes in the organisation in
terms of organisation design, allocation of work to
individuals, a delegation of authority, installation of controls,
etc.

ii) Changes in Operative Personnel: The profile of the

workforce is changing fast. The new generations of workers
have better educational qualifications, place greater
emphasis on human values and question the authority of
managers. Their behaviour is very complex and leading them
to organisational goals is a challenge.

iii) Deficiencies in Existing Structure: Changes may be

needed to make up for deficiencies in the present
organisational setup. These deficiencies may be in the form
of the unmanageable span of management, a  larger number
of managerial levels, lack of coordination among various
departments, obstacles in communication, lack of uniformity
in policy decisions, and so on. 

iv) Changes in Employee Expectations: It can also trigger a

change in organisations. An organisation that hires a group of
young newcomers may be met with a set of expectations
very different from those represented by senior workers. The
workforce is more educated than ever before.

Although this has its advantages, employees with higher

education demand more from employers. The new
generation workforce nowadays is not only career-minded.
Rather they are more concerned with their family and career
balance issues, thus often favouring flexitime or
opportunities to work at their own pace.

v) Changes in Work Climate: Changes in the work climate in

an organisation also stimulate change. A workforce that
seems unmotivated, lethargic, and dissatisfied is a symptom
that must be addressed. This kind of symptom is common in
organisations that have experienced layoffs.

Employees who have escaped a lay-off may grieve for those

who have lost their jobs and may find it challenging to
continue to be productive. They may worry that they will be
laid-off as well and may feel insecure in their jobs.

TYPES OF CAHNGES

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.
2. 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.
3. Happened Change
This kind of change is unpredictable in nature and is usually
takes place due to the impact of the external factors.
Happened change is profound and can be traumatic as it’s
consequences are unknown and out of direct control. This
kind of a change happens when an organization reaches the
plateau stage in its life cycle and gets victimized by the
environmental pressures or demands. For example, currency
devaluation may adversely affect the business of those
organizations who have to depend upon importing of raw
materials largely. In certain cases, some political, as well as
social changes, are unpredictable and uncontrollable.
4. Reactive Change
Changes which take place in response to an event or a chain
of various events can be termed as Reactive Change. Most of
the organizations indulge in reactive change. This kind of
change usually occurs when there is an increase or decrease
in the demand for company’s products or services. It can also
be a response to a problematic situation or a crisis which an
organization may be faced with.
For example, due to the advancements in technology or
growing technological changes, an organization may be
forced to invest more in technology to stay ahead to face the
stiff competition. Recreation can also be regarded as a
reactive change, which involves the entire organization and
occurs during the stage when an organization is undergoing a
serious crisis.
5. Anticipatory Change
If a change is implemented with prior anticipation of the
happening of an event or a chain of events, it is called as
anticipatory change.
Organizations may either tune in or reorient themselves as
an anticipatory measure to face the environmental
pressures.
 Tuning in essentially involves implementing

incremental changes which mean dealing with the

subsystems individually or just with the part of a
system.
 Reorientation essentially involves changing the

organization from the existing state to a desired

futuristic state as an anticipatory measure and then
dealing with the entire process of transition.
6. Planned Change
Planned change is also regarded as the developmental
change which is implemented with the objective of improving
the present ways of operation and to achieve the pre-defined
goals. Planned change is calculated and is not threatening as
in this the future state is being chosen consciously. The
introduction of employee welfare measures, changes in the
incentive system, introduction of new products and
technologies, organizational restructuring, team building,
enhancing employee communication as well as technical
expertise fall under the category of Planned Change.
7. Directional Change
Directional change may become a necessity due to the
increasing competitive pressures or due to rapid changes in
the governmental control or policies, which may include
changes in the import/export policies, pricing structure and
taxation policies, etc.
Directional change can also become imperative when an
organization lacks the capability of implementing/executing
the current strategy effectively or during the circumstances
when a strategic change is required.
8. Fundamental Change
Fundamental Change essentially involves the redefinition of
organizational vision/mission. This may be required during
extremely volatile circumstances like volatility in the business
environment, failure of the leadership, a decline in
productivity as well as the overall turnover or problems with
the morale of the employee.
9. Total Change
A Total Change involves change in the organizational vision
and striking a harmonious alignment with the organizational
strategy, employee morale and commitment as well as with
the business performance.
Total Change becomes a requirement during those
circumstances when an organization is faced with many
criticalities such as long-term business failure, incongruence
between the employee and organizational values, failure of
leaders/management in anticipating the realities of business
environment or the growing competitive pressures and
concentration of power in the hands of few. A new
organizational vision along with major strategic changes as
well as complete organizational surgery can be the only
solution at this point of time.
10. Operational Change
This kind of change becomes a requirement or the need
when an organization is faced with competitive pressures as
a result of which the focus is laid more on quality
improvement or improvement in the delivery of services for
an edge over the competitors. Similarly, changes in the
customer’s buying patterns or demands or the internal
dynamics of an organization equally necessitate the
implementation of operational change.
Operational change as the name implies means introducing
changes in the existing operations for realizing the intended
goals. This may include bringing in changes in the current
technology, improving/re-engineering the existing work
processes, improving the distribution framework or the
product delivery, better quality management and improving
the coordination at an inter-departmental level.
11. Transformational Change (Notes)
12. Revolutionary Change (Notes)
13. Recreation Change (Notes)
Importance of Change in an Organisation
Companies often undergo organizational change to continue
to grow and ensure success. Change can foster the successful
adoption and use of new processes within a business, which
can increase its efficiency. Here are some other reasons why
change can be important to an organization:
1. Remaining relevant:
The process of change can help businesses remain
relevant in industries that also change frequently. This
can also encourage a healthy relationship between an
organization and its consumers.
2. Encouraging innovation:
The process of change can encourage innovation by
allowing a team the chance to test new ideas. This can
lead to new developments in strategies and products
3. Developing Skills
The process of change can help give employees and the
teams on which they work ideas on which skills to
develop. These skills can lead to other changes that
ensure a company has the ability to evolve.
4. Creating New Opportunities
The process of change can encourage the creation of
new opportunities. This can include new markets,
unique target demographics and collaborations with
other companies.
 5. Improving Staff Morale:
The process of change can also lead to the improvement
of staff morale. Changes in an organization can lead to
higher efficiency and can help staff members avoid
burnout from repetition.

Challenges in Change Management

1. Lack of Communication
A failure to communicate intended changes can break you.
Speculation and rumors will sweep your organization, and a
lack of trust will make it difficult for staff to embrace change,
especially when they’re uninformed on what’s required from
them.

Employees need to know what’s going on, because

uncertainty will disrupt your workforce. It’s preferable for
them to understand planned updates, otherwise they’ll be
less aligned with your objectives and feel disconnected.

Keep employees up-to-speed, whether you coordinate

regular meetings or set up brainstorming sessions.
Communication should be two-way, because staff can help
your change procedures with valuable ideas.

2. Resistance
People naturally resist change, because we grow accustomed
to the security offered by our current circumstances.

When we get too comfortable in the present, there’s no

room for future growth. Resistance needs to be addressed on
a psychological level, to remove behavioral barriers that
restrict our evolution.

Major changes throw the cat among the pigeons, threatening

familiarity as staff need to learn new procedures.

By supporting your staff with reassurance, alongside offering

new training, this gives employees the time they need to
adapt to organizational change management. This will ease a
transition into the future, where it’s crucial you can
empathise with staff and reassure them.

3. Lack of Proper Planning

Without step-by-step planning, change in an organization is
likely to fall apart or cause more problems than benefits.
You need to understand exactly what changes will take place
and how those changes will occur.
For example, if you're transitioning to a new content
management system, you'll need to know if the new system
is compatible with the old system. You also need to know
how you will transition the old information to the new
system and if there will be limited access during the
transition. And you have to assign roles to individuals who
are responsible for the change so all duties are covered. The
timeline for the change is also a key component. You need
to plan for downtime or difficulties in completing regular
work tasks while the change occurs.
4. Lack of Consensus
If you fail to get everyone on board with corporate changes,
you are likely to face barriers during the process. The
decision to implement changes should come from the top
level of the organization. All management level staff needs
to be on board and able to deal with the changes or you may
face dissent within the staff.
In many cases, you may not have everyone on board right
from the beginning. Showing managers how the changes will
affect the company and the steps for implementing the
changes can help get them on board if they initially have
reservations.
5. Adopting New Technology
Technology has become the linchpin on which many
businesses grow and thrive but it does have its challenges.
One challenge is integrating new technology with your
existing platforms in a way that doesn’t cause huge logistical
issues. Another challenge is getting your staff up to date on
how to use the new technology. Your employees are the
“end user” when it comes to implementing a new system at
the workplace.
If they don’t believe that new technology will make their
jobs easier, they will question why you are making the
changes. Communicating the specific ways in which the
technology will streamline work processes is an effective
way of overcoming this barrier.
6. Low Employee Morale
In many instances, employees dislike change unless it is one
that they have requested or lobbied for, which means that
obtaining buy-in is a major barrier to change. For example,
let’s say you are changing your organizational structure from
a flat structure in which all employees are encouraged to
give feedback and help make decisions to a top-down
structure in which all power and decision-making is in your
hands. You can expect that employee morale will take a big
hit as your staff members realizes they are losing the power
to have a real say in how things are done.
Low morale becomes a barrier to your organizational change
because your staff is likely to resist the changes. That
resistance will make it difficult for you to facilitate a smooth
transition and may impact productivity and efficiency as
well. When employees are unhappy with your decisions,
they are far less likely to implement those decisions in a
manner that helps your company achieve success.

STEPS IN THE CHANGE MANAGEMENT PROCESS

Define your objective(s)

The first step in the change management process is to define
what you want to achieve in the end. Having a crystal-clear
objective requires an understanding of where your
organization currently lies and where you want it to be.

Your change management process is dead on arrival if your

objective contradicts your company’s vision. Your
organization may evolve but staying true to its vision will help
you retain your identity and originality.

2. Get your management team to buy-in

Single-handedly diving into the change management process
is a no-no. You cannot implement change all by yourself,
even with all the knowledge and technical know-how. You
need the support of your management team to set the ball
rolling.
Start by presenting the problems that the change you seek
will solve in your organization. By doing this, you make it
about the organization and not yourself.

3. Appoint your change management process champions

Although everyone’s support in your organization is
invaluable, you need some key players that will lead the
change management process in different areas. Think of
them as your managers—they will help you coordinate
activities at micro-levels. Have a heart-to-heart discussion
with your change champions about the project and outline
their responsibilities.

4. Communicate your vision to the entire team

The next step is to get everyone in your organization to buy-
in. Mandating everyone to buy into the change plan simply
because you are the boss is not the best approach. You will
get the best results when they buy-in because they share
your vision.

Share your vision passionately. Be open to contributions as

team members might have valuable input that you did not
think of earlier.

5. Get rid of roadblocks

Now that you have gotten everyone on the same page as
you, you need to ensure that there are no roadblocks in your
way; otherwise, your team will not function optimally.

 What old procedures or systems need to make way

for new ones?
  Do you need to acquire new tools to execute the
system you are putting in place?
 Do your team members need to be trained on new
skills to perform tasks in the new system?
 Do you need to reassign responsibilities and duties to
team members?

6. Break your goal into milestones

If your change goal is big, achieving it all at once may seem
impossible. Save yourself the trouble of feeling discouraged
by setting small milestones. You and your team will get a
sense of accomplishment for your successes at the
milestones.

Milestones also help with accountability.

7. Gun for early wins

Nothing gets people pumped up more than early wins;
employees are encouraged to work harder, seeing that their
efforts are paying off. The reverse is the case when their early
efforts look like a waste of time.

Be intentional about early wins by setting targets that are

more achievable than others. Engage with team members
who play vital roles in achieving those targets to get their
maximum inputs.

8. Track your progress

Change management involves a lot of planning, coordinating,
controlling, and evaluating. These factors have to be in sync
to achieve your objective.
Keep track of how things are unfolding. Are you taking too
long to achieve your milestones? If that is the case, what is
causing the delay? Are there still roadblocks in your
organization?

There is a tendency for your zeal and your team members’ to

wear off after a few weeks or months. Hold regular meetings
with your team to keep them motivated.

9. Improve continuously
Change is a continuous process. Do not become complacent
after you have achieved your objective. Review your current
business processes continuously for improvement. By doing
this, you will identify roadblocks that may arise from the new
system you implemented.

Incorporate the change you have achieved in your

organizational culture for uniformity and consistency across
the entire organization.

Manager as Change Agent

 Manger is well versed with the organisation culture,
behaviour, attitudes and potentials of its employees and
supervisors. He always acts in the interests of the
organisation. It is, therefore, beneficial to use the talent and
services of the manager as change agent.

Manager can introduce the change in the organisation

effectively because he does so as his duty and responsibility.
As is said earlier that change involves change in attitudes,
behaviour, ethos, beliefs etc. of the people which are the
personal traits and human resource manager is an expert in
understanding them. He prepares the foundation for change
and prepares himself to face any reaction and criticism and
makes efforts to satisfy all intelligently. He knows his
employees well and can seek their cooperation to carry out
with his plans to implement change.