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Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2

Q1. What are the five disciplines associated with the organisational learning? Ans. There are mainly five disciplines associated with the organisational learning. They are: o Systems thinking. o Team learning. o Shared vision. o Mental models. o Personal mastery.

Core Discipline

Systems Thinking

Team Learning

Shared Vision

Mental Methods

Personal Mastery

The five core disciplines in the organisation learning can be explained as follows: Systems thinking: This is an art which mainly focuses on relationship of many parts of the system. This helps to work with the system rather than against the system. It also helps to learn something about the systematic behaviours. This also helps you to find out some of the unique terminologies and tools that are applicable only in this field. Team learning: This happens when the people are working together in a group on something. The people can learn more when they are working in a team rather than individually since different people will have different ideas in the team. This can be improved by following different kind of conversations and an amount of honesty and mutual respect for others in the organisation. This can be very excellent when you are doing the things properly and you have the knowledge of specific tools. Shared vision: This will only happen when all the individuals in the organisation know the vision of the organisation and know what the company is doing. This needs the commitment of all the individuals to work towards achieving the goals. This will be excellent when one understands how the organisation is working overall and matching the personal goals with the organisational goals. Mental models: These associate with how the world works and these include the beliefs and assumptions. This totally involves the decisions we make at every stage of life. The decisions we take in life to some activities include the behaviours of others. This discipline helps us to test the deep assumptions and beliefs. Personal mastery: This involves the name you have to make in the lifetime. This helps you to achieve your personal goals by making use of the personal mastery in an honest way. There need to be willingness from the heart to make efforts and take risks. Winter Drive November 2011 Sikkim Manipal University 1

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Apart from the disciplines which are core to the organisational learning there are also some of the other disciplines which are helpful. They can be explained as follows: Corporate culture: This influences the environment in which we work every day. This includes the factors like policies, beliefs, activities and rituals that define the personality of the organisation. The culture of the company can increase or decrease the capacity to learn, encourage the creativity and so on. This can be well maintained by carefully maintaining the behaviours with everyone in the organisation. Corporate social responsibility: This explains how the business world affects the society around it. This concentrates on the responsibilities beyond the industry. This involves the effects of the firm on the neighbourhoods, public sector, educational institutions and families which are interlinked in the society. The social responsibility of the corporate mainly focuses on these interconnections. Dialogue: This is the discipline which plays an important role in the communication. This provides the tools and techniques, which is difficult to follow at first and becomes easy as it is practiced. Leadership: This mainly focuses on the roles of managers and leaders for the success of the change process in the organisation. This involves the movement of an organisation leadership from the traditional to the more flexible, self organising leadership. Sustainability: This mainly focuses on the sustainability of an organisation in regard to the resources of the organisation. If we continuously use the resources there may be depletion of resources. So the sustainability helps us to manage the human needs with the natural cycle. Work/life balance: It mainly concentrates on how to balance both the work and non work life. This requires the proper decision to be taken to set the priorities both for the work and non work lives

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Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Q2. Explain the Greiner's Growth Model of organizational growth in detail. ? Ans. Greiner's Growth Model describes various phases that organisations go through as they grow. All kinds of organisations from design shops to manufacturers, construction companies to professional service firms experience these phases. Each growth phase is made up of a period of stable growth that is followed by a "crisis" when there is a need for major organisational change if the company wants to continue growing.

Crisis here means positive turning point or transition. Originally, Larry E. Greiner proposed this model in 1972 with five phases of growth. Later on he added a sixth phase [12](Harvard Business Review, May 1998). All the six growth phases are described below: Phase 1: Growth through creativity This phase is characterised by the following: Technically or entrepreneurially oriented founders. Frequent and informal communication. Long hours and modest salaries. Reactive to marketplace feedback. Here, the entrepreneurs who have founded the firm will be busy in creating products and opening up markets. There wont be many staff, so informal communication is allowed. Rewards for long hours are through profit share or stock options. However, as more staffs join, production expands and capital is provided then there will be a need for formal communication. The leadership crisis As the company grows, new systems will be in demand such as manufacturing, accounting, personnel, etc. The founders usually are not experts who manage this new set of systems and cant motivate new employees. This is called Leadership Crisis and phase one ends with this crisis. At this time the company might bring the management that can manage in this new environment or may struggle as founders and try to maintain the old guard. Winter Drive November 2011 Sikkim Manipal University 3

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2

Phase 2: Growth through direction This phase is characterised by the following: Functional organisation structure. Accounting systems. Formal and impersonal communication. Concentrate on directing the new, top managers. Growth continues in an environment that has formal communications, budgets and that focus on separate activities like marketing and production. As a financial reward, incentive schemes replace stock. However, the situation arises where the products and processes become abundant and there wont be enough hours in the day for one person to manage them all. It is not possible for that one person to know much about all these products or services as that of people in the lower hierarchy. Autonomy crisis As the company grows further, centralised management becomes inappropriate. Lower level managers gain better knowledge of the marketplace but wont be able to react quickly. The second revolution comes from a demand for greater independence. By this, the solution to the first phase becomes the crisis for the second phase. The solution to this crisis is to push decision-making responsibility to lower levels. Managers who fail to do this will see their companies being passed by quicker organisations. Phase 3: Growth through delegation This phase is characterised by the following: More responsibility in the place and field marketing managers Use of profit sharing and bonuses for incentives Managing of exclusion by top managers Activating management through acquisitions Infrequent communication from the top With middle-level managers given freedom to react fast to opportunities for new products in markets, the organisation continues to grow. The top level management just monitors and deals with the big issues like looking at merger or acquisition opportunities. Many businesses struggle at this stage because the managers whose directive approach solved the problems at the end of Phase one finds it difficult to give the responsibility for middle managers. Even then the middle-level managers struggle with their new roles as leaders. Control crisis Field operations will be broadened and inefficiencies come into the system. Top management loses power over planning, money, technology, and manpower. Narrow-mindedness in field operations symbolise this new revolution. Management must solve it by adopting and implementing special coordination techniques. Phase 4: Growth through coordination and monitoring This phase is characterised by the following: Merging of decentralised units into product groups. Establishing and reviewing formal planning procedures. Hiring staff at headquarters to initiate company-wide programs. Reviewing and distributing capital expenditures across the organisation. Measuring field operations through the criteria of Return-on-Capital. Centralising technical functions such as data processing. Winter Drive November 2011 Sikkim Manipal University 4

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Using stock options and profit sharing to encourage identity with the firm. Growth continues with the previously isolated business units re-organised into product groups or service practices. Investment finance is owed centrally and managed according to Return on Investment (ROI) and not just profits. Red tape crisis A lack of confidence starts between the line and the staff, and between the headquarters and the field. Systems begin to survive their usefulness and field managers begin to dislike formalised control by staff managers who do not understand the local markets. Staff personnel dislike the uncooperative line managers. The organisation becomes unmanageable and everyone starts disliking the bureaucratic system that has evolved. A new crisis will come into being. Phase 5: Growth through collaboration This phase is characterised by the following: Focusing on solving problems through team action. Forming teams for various departments. Reducing and reassigning headquarters staff to teams that consult field units. Developing a matrix organisation structure. Simplifying and combining formal systems. Holding conferences for key managers frequently. Utilising educational programs to train managers. Using real-time information systems in decision making. Equipping with economic rewards for team performance. Encouraging experiments in new practices. Growth crisis Here, Greiner guesses about the solution to this new crisis that comes from employees who turn saturated emotionally. They become exhausted both emotionally and physically by the intensity of teamwork and the heavy pressure for innovative solutions. He illustrates this with a European company that created a structure that allowed employees to include a reflective period in their daily activities. Phase 6: Growth through extra-organisational solutions Greiner's added this sixth phase recently and it suggests that growth may continue through merger, outsourcing, networks and other solutions involving other companies. Growth rates vary between and even within phases. The duration of each phase depends totally on the rate of growth of the market in which the organisation operates. The longer a phase lasts, the harder it will be to implement a transition. This is one of the useful models but not all businesses go through these crises in this order. =======================X=======================X=========================

Q3. Explain any two Process based change models. Ans. Winter Drive November 2011 Sikkim Manipal University 5

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Process based change models focus on the actual steps as, how of organisational change process. All the models in this category deal with the sequences of steps that are used to bring about changes in an organisation and interventions related to it. Some of the process based models are: o Lewins Model of Change. o Planning Model. o Model of the Change Management Process. o Integrative Model for Planned Change. o Scheins Model of Change. o Action Research Model. a) Lewins model of change This is one of the early models of planned change. It states that organisational change moves from one static state through a progressional shift to another static state. In this model, change affects three levels-individual level, structure and systems level, organisational climate. This model consists of the following three steps to provide a basis for change at all the levels in the organisation: 1. Unfreeze: This step involves creating the right situation for the change to occur. By refusing change, people connect to a sense of identity to their environment. In this step, the alternatives though are beneficial, will initially cause discomfort. The challenge here is to move people from this 'frozen' state to 'unfrozen' state. 2. Changing/transition: This transition is considered as a journey at this level and at the psychological level it is considered a period of confusion. At this stage, people will be aware that the old ways will be challenged, but there wont be a clear understanding of the new ways which will replace them. As roles change, a reduced state of efficiency is created, where goals are significantly lowered. The final goal of this stage is to get people to the 'unfrozen' state and keep them there. 3. Refreeze: The goal here is to achieve refreeze, re-establish stability and comfort level of people. It takes people from low productivity in the transitional stage to a productive state. UNFREEZE

REFREEZE

TRANSITION / CHANGE

b) Planning model This model was initially proposed by [5]Lippit et al. (1958) but later modified by Kolb and Frohman (1970). This model proposes seven-steps for change. This plan states that there should be free sharing of information between the organisation and the change agent. This information must be further translated into action.

Exploration Winter Drive November 2011 Sikkim Manipal University Entry

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2

This model goes through series of steps. In the first step, organisation and change agents together explore the need for and the areas that require change. They enter into it. This will be followed by diagnosing of specific goals towards improvement. Changes cannot be made without handling resistance so reasons for resistance will be identified and worked out and then planning will be done for specific improvement. This plan will be put into action which is next step and followed by evaluation and termination of the system or to begin another. Model of the change management process Galpin (1996) proposed this model and states that a successful organisational change effort should target two levels-the strategic level and the grassroots level. Strategic level refers to up-front, initial effort involving executives, senior managers, few employees, and consultants who provide an outside view. Grassroots level drives changes deeply and stresses on implementation at the local levels. This model involves nine stages: 1. Establishing the need for change. 2. Developing a vision of change. 3. Diagnosing the current situation. 4. Generating change recommendations. 5. Detailing recommendations. 6. Testing of pilot. 7. Preparing recommendations for roll out. 8. Rolling out changes. 9. Measuring, reinforcing, and refining changes. Winter Drive November 2011 Sikkim Manipal University 7

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


All these stages showcase creating and implementation of changes in the organisation. Integrative model for planned change Bullock and Batten (1985) proposed this model to describe both temporal states and change processes involved in change. It is based on the principle that organisation exist in different states at different times. This model involves four Exploration Phase

Planning Phase

Action Phase

Integration Phase Scheins model of change Schein (1987) extended Lewins basic model and included newer concepts. This model has been explained next: Unfreezing: According to Schein, unfreezing is a process for creating enthusiasm and readiness for change. Cognitive restructuring/ redefinition: It is a process by which an enthusiastic learner can learn something new that is related to his thought processes, feelings, values, and attitudes. Defensive identification with a role model: When a learner is motivated to change, that person realises that a concept may be interpreted in different ways than ones own. So one can adopt new perspective that facilitates change. A very good example for this is brainwashing. Action research model This model is proposed by [9]Cummings and Huse (1989). It is assumed that planned change is a cyclical process. This model proposes that organisations need to undertake research initially to have adequate information that guides in their future action. This model involves eight steps and they are as follows: 1. Identifying the problem. 2. Consulting an expert. 3. Gathering data and diagnosing at preliminary level. 4. Collecting feedback. 5. Diagnosing the problem jointly. 6. Planning of action jointly. 7. Action. 8. Gathering of data after action. =======================X=======================X========================= Q4. Describe managing change during turbulent times and setting clear expectations. Ans. Winter Drive November 2011 Sikkim Manipal University 8

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Due to an unhealthy economy, all of us are working in turbulent times and organisations are under deep pressure, and reacting with aggressive thriftiness measures such as reducing, restructuring, rescheduling, and merging with competitors or strategic alliances. They are also closing unprofitable facilities, moving managers to open work environment from private offices. Effective working is very important when few employees are present in an organisation, it is seen that in the current world only the strongest organisation survives for a longer period. During the turbulent times the leaders focus on managing a balance between cost cutting and supporting the employees to serve in a better way to the organisation. The enterprises that emerge from considerable organisational changes are stronger and more competitive and are more focused on the effectiveness of the employee this is done by increasing productivity through teamwork and collaboration, rising organisational innovation, enforcing responsibility at all levels, making the workplace to attract, inspire and to retain talent and to accommodate the needs of multigenerational workforce. Economic and world events brought unexpected changes inflation, productivity challenges, technology shifts, and global competition all hit the business world at about the same time and made the classical planning methods suddenly outdated. During this time many organisations followed Peter duckers suggestions that helped employees managing during turbulent times and managing the complex work. In the times of disorganised changes maintaining productivity is a fundamental necessity of managers, and it is done for four key resources they are capital, crucial physical assets, time, and knowledge. For example, Siemens organisation has successfully beaten their competition by significantly increasing their productivity of capital or resources. Another effective method of managing in turbulent times is strategic assignment of critical resources. The managers need to be smart about selecting areas of potential results and allocating resources consequently. In chaotic times, there is a natural tendency to use resources to solve current problems, but the top priority should be given to the areas of potential opportunities. Drucker suggested managers to avoid working on problems that were important in the past and that was not expected to be beneficial in the future. An exit strategy is essential to be developed so that resources are allocated to areas with the highest probability of future achievements and success for the organisation. For example, the organisation GE followed a critical activity called work out program and was successful. This activity was designed to eliminate work that did not meet the strategic needs of the organisation. This activity was suggested by Drucker in the past. Stimulating innovation during managing change is a critical managerial competence essential in turbulent times. The most challenging task for managers is to respond effectively to the task that cannot be planned in advance to the time. This circumstance is more complicated, when its function is in global business environment. The leaders or the managers should be prepared to lead this environment of multidimensional changes and organise their organisations to function effectively during the transformations of their organisational culture. Setting clear expectations To manage the change in the organisation effectively setting clear expectation or goals are necessary with in the organisation. The organisation should provide clarity about the most critical Winter Drive November 2011 Sikkim Manipal University 9

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


elements of the change by explicitly bringing out the implications and expectations for the employees. Reducing uncertainty increases morale and decreases distracting emotions of the employees. To Select and postpone the nonessential projects, and to recognise the importance of making symbolic changes and to increase or decrease the unrestricted responsibilities in order to accomplish the heavy lifting associated with major change. It is important to focus on employees to do the work that is required and it is essential for the organisation to be clear about the employees needs and to ensure that the needs of the employees are satisfied. The managers set their expectations and follow them. The managers or the leaders should: Demonstrate strong ethics. Ensure confidentiality in the organisation. Show empathy for the emotional and personal effects of change and be available and listen to the employees concerns. Ensure the communication of key event and activities, that is to provide details on who, what, when, and where as known. Programme regular updates for all team members in the organisation. Communicate the decisions and justify and to recognise that individual have various communication needs. Manage the change and undertake the obstacles to bring effective change in the organisation. Focus on delivering value in running and changing the business. Stick to fated timelines and processes and act according to the agreements. =======================X=======================X=========================

Q5. What are the skills and ability required for the role of change agent? Ans. Winter Drive November 2011 Sikkim Manipal University 10

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


The change agents design and implement the changes to help the organisation to respond to the demands of the dynamic economy. According to [3]Sims the new economic environment gives tremendous demands to the change agents. Change agents play an important role to assist change implementation. They educate, guide, coach and facilitate the employees and management who are a part of change process. They play a helpful role for the organisation in bringing the change and in achieving the objectives of the change. According to Balogun and Hope Hailey the roles of the change agent include external facilitation, leadership and good entrustment. Hutton suggests that the role of the change agent is to support top management to bring about determined transformation of the organisation. According to Hutton the transformation process: Helps the employees to think different about the work. Change the norms of the organisation that includes the usual work practices. Change the organisations systems and procedures to improve and achieve the objectives of the change. According to Spence there are four fundamental and crucial roles of the change agent. They are: Observer The change agents have to observe the environment, processes, attitudes and behaviour of the employees with in the organisation before implementing the change process. The first and the most important task of the change agent is the observation. Diagnostician The judgement based opinions are ineffective. Therefore the change agent should analyse the information that they have gathered and should have the idea about the change process. Thus the diagnostic process should be based on sufficient information available. Strategist The change agent is a policy maker and a planner. The change agent should be strategist in taking many decisions. The action of the strategist is to identify the problem on addition to it the strategist should emphasis the fact that there are many ways of handling a particular problem. Stimulator Spence suggests that it is good to stimulate others instead of taking actions alone and this makes the role of the change agent to achieve many objectives of the change process. The advantages are identified below: Encouraging the individuals to participate and that in turn helps the change agent. Avoiding the change agent from going wrong in any areas. Making the change agent to act as both advisor and assessor or evaluator. Increasing the confidence level of the employees. A change agent should: Be a good sensor of the business environment. Function vertically and horizontally. Have good leadership skills in all the levels. Be a manager as a catalyst. Perform with shorter time-frame perspective. Be a good balancer in work and personal life. Have a good knowledge of information. For an effective change agents need to be an expertise in the following area. They are: Strategy formulation. Human resource management. Marketing and sales. Winter Drive November 2011 Sikkim Manipal University 11

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Negotiation or conflict resolution. The change agents are required to follow the steps to achieve successful management of change in an organisation. Freeze Change Providing Support to sustain in embedded change

Implementing Change

Managing Transition Incremental Changes for Improvement

Communicating Effectively Developing Awareness or Winning Confidence

Challenging the Status Quo Stirring the environment of psychological discomfort

Developing Visionary Leadership Creaitng Shared Vision

Predicting and Managing Resistance Mobilising Commitment

Developing Process of Change of Culture Generally the most important contribution made by the change agent role is to maintain the organisations present performance and make the future performance effective that includes: Winter Drive November 2011 Sikkim Manipal University 12

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


Enabling the employees to work effectively to plan, implement and to experience change. Managing the future change and increase the employees ability. According to Dave Ulrich the successful change agents had the ability to: Diagnose a problem that is to understand the organisation and the business drivers and should recognise performance issues, analyse the results of impact on short and long term business. Build the relationships with a client that is to form partnerships with common responsibility for the outcome of the change since the faith is very essential as the risk is very high. For an effective change the client and the change agent should have a high level of trust on each other because of the high risk. For Example, the management consultant Ric Reichard uses an easy method to discuss the issues Trust = (perceived competence + relationship)/RISK. Understand and motivate the workforce and the idea of change should be expressed. Set a leadership agenda that is to define the ongoing role for leaders, such as reinforcement of necessary behaviours, this makes the hr employee to closely understand the history and competencies of the leadership team and have a firmness to insist on the achievement of the scheme. Solve the problem that is the change agent must recognise the issues and must be concerned about the employees involved in the issue and must resolve the problem effectively. Implement the plans to achieve change goals that is successful organisational change on the significant level is attributed to the right strategy and suitable change in organisation culture. Here culture change depends on supportive employee polices, systems and processes. From the above competencies, the skills required for the effectiveness of change agent are to: Communicate effectively in all the directions. Know well about the organisation, business, products, services and work processes. Keep a business perspective in both macro and micro, that is to have a vision on how mangers manage. Plan effectively and possess project management skills. Managing resistance and risk. Managing conflict. It is noticeable that the above features are the combination of personal attributes and skill sets that is required for the change agent to be effective.

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Q6. Describe in detail transformation through McKinseys plan. Ans. Winter Drive November 2011 Sikkim Manipal University 13

Master of Business Administration-MBA Semester 4 Assignment - MU0018 Change Management - Set 2


The McKinseys Plan gives the ten ways of transformation for an organisation. I. II. III. IV. V. VI. VII. VIII. IX. X. Organise mainly the processes not the task. Minimise the subdivision of processes. Give in charge of the change process to the senior persons. Link the objectives to the customer satisfaction. Focus mainly on the teams rather than the individuals. Focus on combining both the managerial and non managerial activities as much as possible. Focus more on the development of competencies among all the individuals. Inform and train the people without the delay. Increase the supplier and customer contact with all the individuals in the organisation. Reward the skill development and team performance rather than the individual performance alone.

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