Module- 1

Introduction to Change
 What is Change?

 According to Curtis W. Cook, Phillip L. Hunsaker and Robert E. Coffey

change is “ the coping process of moving from the present state to the
desired state that individuals, groups and organizations undertake in
response to dynamic internal and external factors.”

 An organization must develop adaptability to change otherwise it will

either be left behind or swept away by the forces of change.
 Features of Organizational Change

Some of the widely used features of organizational change are:

1. Organizational change process always invites disagreement and

contradictions.

2. Organizational change is an on-going and continuous process

3. Organizational change process is not always a smooth sailing (it

requires thorough study of different implications of change to the
organization).

4. Organizational change process succeeds through collaborative

inquiry and teamwork - it is a group activity; it cannot succeed merely
through planning and action by the top mgt.
 Nature of Organizational Change

 When change occurs in any part of the organization, it disturbs the old
equilibrium necessitating the development of a new equilibrium. The
type of new equilibrium depends on the degree of change and its
impact on the organization.

 Any change may affect the whole organization; some parts of the
organization may be affected more, others less; some parts are
affected directly, others indirectly.

 Organizational change is a continuous process. However, some

changes which are of minor type, may be absorbed by the existing
equilibrium; others, which are major ones may require special change
efforts.
 Need for Organizational Change
 Organizational change is basically organic adjustments, and it is
needed for different reasons as under:

 To set right the situation- Organizations often need to correct

situations, which they believe require some adjustment or change.
 For example, in a recessionary market an existing HR policy on
variable pay may seem to be incorrect when it is based on value of
total sales.

 To fix things that are needed- In order to correct poor performance

areas.
 For Example, disadvantages arising out of its location relative to its
market may require an organization to set a marketing office and
relocate some staff in order to rectify the situation.

 To Grab the opportunities to grow- New market opportunities may

motivate an organization to build new capabilities by expanding their
activities or through strategic alliance, identifying business partners.
 For Example, when Political pressure in the US mounted against
outsourcing to India, Infosys set up its units in Canada to get US-
outsourced jobs, and then routed these to their Indian Units.

 To Emerge as a different Entity- Often organizations change to

become more flexible. While adapting to new situations is
essential, flexibility in operation or functions may also be required
in special circumstances.

 For Example, developing strategic business units based on

product mix or type to make each product type an independent
profit centre.
 To give each product a competitive edge over Fuji Photo Film,
Kodak restructured the organization and formed 34 strategic
business units.
 Change Triggers
 Organizational change is necessary to enable organizations to remain
competitive, productive and profitable. The change process is
initiated from the top and then cascaded down through the workforce.
 Although there are many reasons for organizational change, some of
the common reasons are:

1. Business Development-driven Change- Potential areas of change

 Sales Development
 New Product Development
 New Market Development
 Organizational structure, systems and processes
 Tools, equipment, plant, supply chain, etc.
 In most organizations, business development-driven changes takes
place with the vision of the top corporate people.
 They initiate the change process to make their organizations
competitive.
2. Environment-driven Change- In a global economy, a recessionary
trend in one country may require us to prepare for a change.
 Thus, adapting to environmental changes is imperative for modern
organizations.
 Environment-driven changes requires an organization to review its
structure, relationships with stakeholders, organizational dependence
on the environment(buying and selling, i.e. Customers and suppliers),
compliance with changing government policies and programmes, etc.
 Changing tastes and preferences of customers compelled many Indian
Organizations to produce value-added products.
 For example, HLL’s brand extension strategy of Lifebuoy soap with
Lifebuoy Plus, Lifebuoy Gold and the addition of moisturizers is a good
example of customer-centric change in product mix.
 24*7 customer Helplines.
3. Culture-driven Change- Developing the desired culture enables
organizations to focus on their changing goals and objectives, which may
require that people re-examine their attitudes and perceptions about
customers and market situations, etc.
 Corporate culture also develops shared values and beliefs and addresses
the diversity issues, which become more important in cases of mergers
and acquisitions.

4. Process-driven Change- Organizations are often required to undergo

process redesign to optimize resource utilization and to achieve increased
levels of productivity and performance.
 Any technological change may succeed process redesign.

 Also, changing market requirements may require change in the way the
jobs are completed.
5. Competency-driven Change- Competency is an aggregate of the
knowledge, skills and abilities of the people, which together enable the
organization to remain competitive in the market.
 Competency mapping identifies the competency gap and organizations
can accordingly initiate training and development activities to reduce
the gap and extend support for org. change.

6. Innovation-driven Change- Use of innovation as a tool for

organizational change is often misconstrued as a new product
development, or simple research and development work.
 Microsoft, GE, Ford motor company all think that Innovation is central
to the success of any organizations and make customers happy and
keep competitors at bay.
THE STORY OF EAGLE
 https://www.youtube.com/watch?v=h8_T40WKSs
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 WHAT IS ORGANIZATIONAL DEVELOPMENT
 Organizational Development is unique organizational
improvement strategy that emerged in the late 1950s.

 OD is an educational strategy which focuses on whole culture of

the organization in order to bring about planned change.

 It seeks to change beliefs, values, attitudes and structures – infact,

the entire culture of the organization, so that organization may
better adapt to technology and live with pace of change.

 OD activities in an organization set the premises for bringing the

desired organizational change.

 According to Christopher G. Worley and Tom G. Cummings, “

OD is a wide application of behavioral science knowledge to the
planned development and reinforcement of organizational
strategies, structures and processes for improving an
organization’s effectiveness.”
 According to Bennis (1969), organization development primarily
rests on three basic premises.
 To revitalize and rebuild the organization, keeping pace with the
changes.
 To create the desired climate in the organizations changing the
existing systems of beliefs and values.
 To introduce the new social awareness to the people working with
the organizations.

 According to American Society for Training and Development

(ASTD), has identified one widely accepted definition developed by
Beckhard:
 “An effort (a) planned, (b) organization-wide, (c) managed from the
top, to (d) increase organization effectiveness and health through (e)
planned intervention in the organization’ processes, using
behavioural science knowledge.”
 Various types of OD Interventions are undertaken depending on
the pattern of organizational change.

 These interventions can be classified into the person-centred

approach, the structural approach and the relationship approach.

 The person-centered approach requires the development of

both social competence and general intellectual competence and
the ability of members of the organization to innovate.

 The structural approach requires integration of segregated

work sequences and the decentralization of decision making.

 The relationship approach requires team development, role

negotiations and transparent feedback methods.
 CHARACTERISTICS OF OD
 OD is a planned organization change – it identifies problems,
diagnoses and develops strategies for improvement. In this process
of change, OD programmes make use of values, attitudes, culture
and team development.

 OD is a planned intervention – an OD intervention programme is

well-structured, as the intervention strategy is developed after duly
examining present working norms, values and possible areas of
conflict, considering various alternatives for better results. Some
areas of intervention are planning, team development, org. Structure,
values, culture, etc.

 OD involves commitment from the top – OD is a top-down

approach but requires mutual trust and collaborative relationships
with all cross sections of people in the organization.

 OD makes use of social philosophy as norms of change – OD

uses behavioral science knowledge and ensures that the process
change takes place in humane and democratic manner.
 EVOLUTION OF OD
 Lewin is widely recognized as the father of OD.
 Group Dynamics and the action research concepts of Lewin form the
basis of OD.
 OD draws inputs from social psychology, sociology, psychology and
anthropology.
 We can understand OD from three different stems:

a) Laboratory Stem – has its origin at the National Training Laboratories

and the Research Centre for Group Dynamics of the MIT, under the
leadership of Kurt Lewin in 1946.
 The process started with the research and training for community
leaders, where they were brought together to discuss problems.
 Their discussions led to two conclusions:

1) That feedback in group interaction could be a rich learning experience.

2) That this experience could apparently lead to an organizational
change through group building.
b) Survey Research Feedback Stem – this stem emerged from the use
of attitude surveys to study group dynamics in 1945 at MIT
 It was a two-year study covering 8000 nonsupervisory employees of
Detroit Edison.
 The scope of the study was to collect data on perceptive attitudes of
non-supervisory employees towards their supervisor, promotion
opportunities and work satisfaction.

c) Socio-Technical Stem – Tavistock Institute suggested the open socio-

technical system which does not consider human and technical
dimensions of work in isolation but focuses on the interaction and
inter-relatedness of the two.

 During 1950s and 1960s, the focus of OD was more on the social
dimensions of organizations and on the humanistic values to promote
openness, trust and collaboration.

 In 1970s, it was influenced by the organizational theory and the human

side of technology, with emphasis on structural change, employee
involvement and work design.
 In the 1980s, OD became a theory and many new concepts and
opinions were integrated with it. The emphasis now was on the
techniques for reward systems, career planning and
development and employee assistance programmes.

 With a mgt-centric OD approach, by 1990s it became an applied

discipline with action research.

 Today, OD is considered as the tool to achieve organizational

transformation.