Module 2

CHANGE PERSPECTIVES
Module Outline
• Different perspectives related to change; changes as a Strategic Management
tool
• Change for internal re-organization; impact of change on Human Resources
Planning
• Global perspectives related to change; quality consciousness as an emerging
catalyst for change
• Determinants of Change, Types of change
Perspectives On Change
• Development Change
• The improvement of a skill, method or condition that for some reason does
not measure up to current expectation
• to do better' or do more of' what already exists.
• Incremental change
• Transformational change
Types
• Strategic Change
• Structural change
• Process oriented change
• Cultural change
 Integrated Strategic Change
(ISC)
• Strategic Analysis
• Strategic Choice
• Designing the Strategic Change Plan
• Implementing the Strategic Change Plan

19-6
 The Integrated Strategic
Change Process

Strategy Strategy
S1 Strategic S2
Change
Plan

Organization Organization
O1 Implementation O2

Strategic Analysis Strategic Choice

19-7
 ISC Application Stages
Strategic Analysis
◦ Assess the readiness for change and top management’s
ability to carry out change
◦ Diagnose the Current Strategic Orientation
Strategic Choice
◦ Top management determines the content of the
strategic change
Designing the Strategic Change Plan
◦ Development of a comprehensive agenda to achieve the
change
Implementing the Strategic Change Plan

19-8
Reorganization
• A reorganization is a significant and disruptive overhaul of a troubled
business intended to restore it to profitability.
• It may include shutting down or selling divisions, replacing
management, cutting budgets, and laying off workers.
• Reorganization can include a change in the structure or ownership of
a company through a merger or consolidation, spinoff acquisition,
transfer, recapitalization, a change in name, or a change in
management.
• This part of a reorganization is known as restructuring.
 Mergers and Acquisitions
Merger - the integration of two previously
independent organizations into a completely new
organization

Acquisition - the purchase of one organization by

another for integration into the acquiring
organization.

Distinct from strategies for collaboration, such as

alliances and networks, because at least one of
the organizations ceases to exist.
19-10
Merger and Acquisition Rationale

• Diversification
• Vertical integration
• Gaining access to global markets,
technology, or other resources
• Achieving operational efficiencies,
improved innovation, or resource sharing

19-11
Determinants of Change
1. Environmental
2. Structural
3. Management Orientation
Environmental
• the organization must have to focus on the needs and wants of the
customer.
• Change in product line
• change in services
• development of a new product
• target the customer at some other market place
• in terms of better quality
Structural
• the typical consideration for an organization is that its structure of
must be compatible with the strategy of the organization
• lose in the sense of autonomy
• tight in the sense of setting-up of high performance goals
Management Orientation
• Successful organizations are those where entrepreneurship and risk-
taking is encouraged at divisional level and innovation being rewarded
at multiple tiers of hierarchy
• instead of satisficing, action that ensures goal attainment is
encouraged.
• Sticking to one's knitting ­to original area of organization instead of
being led by different attractive alternatives.
• Stress upon single value ­this is minimizing cost and satisfying the
unique need of the customer
Quality consciousness as an emerging catalyst for
change
• quality is the “totality of characteristics of an entity that bear upon its
ability to satisfy stated and implied needs,”
• The term “quality consciousness” was first used, from what I can find,
in a 1947 keynote by C.R. Sheaffer to the first convention of the
American Society for Quality Control (ASQC).
• Quality consciousness can be summed up by the “3 A’s”
– Awareness, Alignment, and Attention.
• Quality consciousness implies awareness of yourself and the
environment around you (including what constitutes quality and high
performance for people, processes and products – most importantly,
YOU).
• Quality improvement will reduce rework, improve efficiency, promote
the continuous improvement activities in an organization, many
employees are aware of the quality improvement will indeed increase
business income, make enterprises bigger and stronger, so as to
create more jobs,