Amity School of Business

Amity School of Business

BBA, SEMESTER V

ORGANISATIONAL DEVELOPMENT AND CHANGE

(BBAHR-30502)
Module-2
(LEADING CHANGE)

Divya Goel 1
 Amity School of Business

Contents
• Need for change
• Types of change
• Impact of change
• Factors causing change
• Resistance to change
• Overcoming resistance to change strategies

2
 Amity School of Business

What is Change?
• Coping process of moving from a
unsatisfactory present state to a desired
state

3
 Amity School of Business

Reacting to Change

• Unplanned change
• Planned change

4
 Amity School of Business

TYPES OF CHANGE
The three types of change that occur most frequently in
organizations are:
1. Developmental
2. Transitional
3. Transformational

5
 Amity School of Business

Planned and Unplanned Organizational Changes

Organizational
Change

planned
plannedChanges
Changes Unplanned
•• Changes UnplannedChanges
Changes
Changesin inproducts
productsand
and •• Changing
Changingemployee
employee
services
services demographics
•• Changes demographics
Changesin inadministrative
administrative •• Performance
Performancegaps
gaps
systems
systems •• Governmental
•• Changes Governmentalregulations
regulations
Changesin inorganizational
organizational •• Economic
Economiccompetition
competitionin
inthe
the
size
sizeor
orstructure
structure global
•• Introduction globalarena
arena
Introductionofofnew
new
technologies
technologies
•• Advances
Advancesin ininformation
information
processing
processingandand
communication
communication
 Amity School of Business

Force Examples
Nature of the workforce More cultural diversity
Aging population
Many new entrants with inadequate skills

Technology Faster, cheaper, and more mobile computers

Economic shocks Rise and fall of stocks

2000–02 stock market collapse
Record low interest rates

Competition Global competitors

Mergers and consolidations
Growth of e-commerce
Social trends Rise in discount and “big box” retailers

World politics Iraq–U.S. war

Opening of markets in China
War on terrorism following 9/11/01
7
 Amity School of Business

Factors causing change

• Environmental
• Technological
• Legal
• Political
• Social
• Cultural

8
 Amity School of Business

Structure, Technology, and People as Targets of Organizational Change

Structure
Structure

Technology
Technology
Organizational
Organizational
Change
Change

People
People
 Amity School of Business

Resistance to Change
• Forms of Resistance to Change
– Overt and immediate
• Voicing complaints, engaging in job actions
– Implicit and deferred
• Loss of employee loyalty and motivation, increased errors or
mistakes, increased absenteeism
Two major factors determine the level of
resistance to organizational change :
• Degree of change.
• Impact on organization’s culture.
Amity School of Business

11
 Amity School of Business

The Life Cycle of Resistance to Change

The response to change tends to move through a life
cycle:
• Phase 1: Only a few people see the need for change and
take reform seriously. The resistance looks massive.
• Phase 2: Forces for and against change become
identifiable.

12
 Amity School of Business

• Phase 3: There is a direct conflict and showdown

between the forces for and against the change.
• Phase 4:If the supporters of the change are in power
after the decisive battles, they will see the remaining
resistance as stubborn and a nuisance. There is still a
possibility that the resisters will mobilize enough support
to shift the balance of power.
• Phase 5: The resisters to the change are as few and as
alienated as the advocates were in the first phase.

13
 Amity School of Business

Five Phases in Action

• Phase 1:In the 1970s the environmental
movement began to grow. The First Earth Day was
held in 1970.Widespread interest in environmental
concerns subsided during the 1980s. Some
political officials neglected environmental
concerns, and environmentalists were often
portrayed as extremists and radicals (even
antidevelopment). The forces for change were
small, but pressure for change persisted through
court actions, elected officials, and group actions.

14
 Amity School of Business

• Phase 2: Environmental supporters and opponents

became more identifiable in the 1980s. Secretary of
the Interior James Watt was perhaps the most vocal
and visible opponent of environmental concerns and
served as a “lightening rod” for pro-environmental
forces like the Sierra Club and the Wilderness
Society. As time passed, educational efforts by
environmental groups increasingly delivered their
message. The public now has information and
scientific data that enabled it to understand the
problem.
15
 Amity School of Business

• Phase 3:The Clean Air Act passed by Congress in

1990 represented the culmination of years of
confrontation between pro- and anti-environmental
forces. The bill was passed several months after
national and worldwide Earth Day events.
Corporations criticized for contributing to
environmental problems took out large newspaper
and television ads to explain how they were
reducing pollution and cleaning up the environment.
The “greening” of corporations became very
popular.
16
 Amity School of Business

• Phase 4: One example is the confrontation between

Greenpeace (an environmental group) and Shell Oil. The
Greenpeace group had been campaigning for weeks to block
the Royal Dutch/Shell group from disposing of the towering
Brent Spar oil-storage rig by sinking it deep in the Atlantic
Ocean. As a small helicopter sought to land Greenpeace
protesters on the rig’s deck, Shell blasted high-powered water
canons to fend off the aircraft. This was all captured on film and
shown on TV around the world. Four days after the incident,
Shell executives made a humiliating about-face; they agreed to
comply with Greenpeace requests and dispose of the Brent
Spar on land. The incident, like the Exxon Valdez oil spill, shows
how high profile cases can ignite worldwide public interest .

17
 Amity School of Business

• Phase 5: Much of the world now sees

environmentally responsible behavior as a
necessity. Near-zero automobile
emissions are moving closer to a reality.
Recycling has become a natural part of
everyday life for many people. But new
ways to be environmentally responsible
are still being sought.

18
 Amity School of Business

Why Individuals resist change?

• Fear of the unknown.

• Lack of good information.
• Fear for loss of security.
• No reason to change.
• Fear for loss of power.
• Lack of resources
• Habit
• Economic factors
• Selective information processing
19
 Amity School of Business

Why organizations resist change?

• Threat to established resource allocations.

• Threat to established power relationships.
• Threat to expertise.
• Group inertia.
• Structural inertia.
• Limited focus of change.

20
 Amity School of Business

OVERCOMING
RESISTANCE TO
CHANGE-STRATEGIES

21
 Amity School of Business

Problem of overcoming resistance to change

can be handled at two levels:
(i) At the individual level.
(ii) At the group level through group dynamics.
Both these attempts are complementary and
sometimes these efforts may be overlapping
because every individual is a member of some
group, both at the formal and at the informal
levels.

22
 Individual Level Amity School of Business

Overcoming Resistance to Change

Education and
Communication Participation

Negotiation Facilitation
and Support

Manipulation
Coercion
and Cooptation

Promote Positive Attitudes Toward Change

 Amity School of Business

METHODS FOR DEALING WITH RESISTANCE TO CHANGE

Approach Commonly used Advantages Disadvantage
Education and When there is lack Once persuaded, Can be time
Communication of information or people will often consuming if lots
inaccurate help with the of people are
information and implementation of involved.
analyses. the change.

Participation Where the People who Can be time

and initiators do not participate will be consuming it
involvement have all the committed to participants
information they implementing design
need to design the change, and nay in inappropriate
change, and relevant change.
where information
others have they have will be
considerable integrated into the
power to resist. change plan.
24
 Amity School of Business

Approach Commonly used Advantages Disadvantage

Facilitation and When people are No other approach Can be time
Support resisting because works as well with consuming,
of adjustment adjustment expensive and still
problems. problems. fail.
Negotiation and When someone or Sometimes it’s a Can be too
Agreement some group will relatively easy way expensive in many
clearly lose out in to avoid major cases if it alerts
a change and resistance. others of negotiate
when that group for competence.
has considerable
power to resist.
Manipulation Where other It can be a Can lead to future
and tactics will not relatively problems if people
Co-optation work or are too quick and feel manipulated.
expensive. inexpensive
solution
to resistance
problems. 25
 Amity School of Business

Approach Commonly used Advantages Disadvantage

Explicit and Where speed is It is speedy and Can be risky if it

implicit essential, and the can leaves people
coercion changes initiations overcome any mad
possess kind at the initiator.
considerable of resistance.
power.

26
 Amity School of Business

Methods to minimize resistance

Efforts to minimize any resistance should be
undertaken while it is still potential rather than real.
The different methods to minimize resistance are:
• Compulsion Threats and Bribery
• Persuasion, Rewards and Bargaining
• Security and Guarantees
• Understanding and Discussions
• Proper timings
• Flexibility and tentative approach

27
 Amity School of Business

• Involvement and Participation : are the most

powerful techniques management can use to
gain acceptance of change.The extent of
personal involvement can range from merely
being informed, to discussing problems and
voicing opinions and feelings to actually making
and implementing decision.

28
Amity School of Business

29