Topic 9

TOPIC 10

Innovation and Change

• This Lesson focuses on the rapid change confronting modern
organizations and how technology is a key factor to this change and
the need for continues organizational learning.
At the end of the lesson, you should be able to:
• Explain the concept of change
• Explain the dilemma of organizational change
• Explain the change process
• Explain the impact of technology on organizational change
• Explain the concept of organizational learning and change
The Concept of Change

• The twenty-first century is a period of unprecedented change in

organizational restructuring, reengineering, downsizing, and other
assorted changes (Hodge et al., 2003).
• Even during the robust economy of the late 1990s, many large
companies were shedding jobs at an incredible pace. The economic
slowdown in 2000-2001 has hastened the pace.
Change is simply the alteration of the status
quo
• In a technical sense it occurs continuously; no moment is exactly like
the one that preceded it.
• For practical purposes, however, we are interested in significant,
planned changes to the organizational formation processes, changes
to structure or design, changes to coordination mechanisms, changes
to people and roles in the organization, changes to culture, or
basically changes to any of the aspects of organizations (Hodge et al.,
2003) .
The Dilemma of Organizational Change
• Organizations face a dilemma with respect to planned change. On the
one hand, organizations desire to experience change in order to
remain competitive, to adopt more effective and efficient means of
operation, and to remain in harmony with their environments.
A key concern is for the organization to meet the needs for change and
responsiveness while maintaining enough stability to prevent disruption of
operations .
• Therefore, the organization must find its place along the following
continua:
• Stability ……………………………………………… …………Rapid change
• Predictability……………………………………………………Unpredictability
• Staleness…………………………………………………………Innovation
• Familiarity…………………………………………………………Unfamiliarity
• Boredom……………………………………………………………Energy
• Certainty……………………………………………………………Uncertainty
• Atrophy………………………………………………………………New strenght
The change processes
• The process of changing an organization may be a complex and
drawn-out affair that involves many people, large amounts of
organizational resources, and lots of time.
The following are the 12 steps in planned organizational change process
(Hodge et al., 2003):

• 1.Scanning environmental and internal conditions

• 2.Recognizing the gap between current conditions and desired conditions
• 3.Crystallizing perceptions and assessment
• 4.Planning and analysis
• 5.Determining change goals
• 6.Determining change tactics and program
• 7.Unfreezing behaviors
• 8.Evaluating change plan
• 9.Adjusting or modifying plan
• 10.Implementing plan
• 11.Following up
• 12.Refreezing behaviors and attitudes
Planned incremental change
• This is change that is evolutionary rather than revolutionary (Hodge et
al., 2003). For example, suppose an organization decides to institute a
new human resources system. A human resources system involves
many facets of organizational life including recruiting, training,
performance evaluation, compensation, promotions and benefits.
Radical Change
• Sometimes referred to as frame breaking change, is brought about by
major changes in the business strategy. Changing strategy typically
requires a change in structure, people, and organizational processes.
• Researchers suggest that organizations often go through long periods
of stability and then face a brief period of fundamental change in the
industry that requires the organization to undergo radical frame
breaking change (Hodge et al., 2003).
Unplanned change
• This is change that just happens or emerges. Strategy and practice in
the organization emerge in the course of business as a stream of
actions and decisions (Hodge et al., 2003).
• As so far noted, organizations are dynamic and changing entities. The
environments in which they are embedded are also constantly
changing
Types of organizational change
• The following six sections identify and briefly describe discrete
aspects of an organization that can be changed. Though viewed as
discrete parts of the organization, it is important to take note that
change in one area often demands change in other areas.
Goals and Strategy
• Most types of planned organizational change involve some
modification of organizational goals and strategy (Hodge et al., 2003).
Some planned changes may emerge from lower levels of the
organization in response to local problems or conditions.
• Although these changes may not be motivated by changing corporate-
level goals or strategy, they are most likely to be driven by local
department or work unit goals.
People
• One of the more pervasive forms of change that has affected
organizations around the world has been downsizing. Although there
are typically structural aspects to downsizing (the elimination of layers
of bureaucracy, merging of departments or divisions, etc.), the most
obvious aspect of downsizing is that the organization eliminates
people.
Technology and organizational change
• There is an attempt to increase productivity and flexibility in
manufacturing whereby many firms are changing their technologies.
Process mapping
• This is an attempt to change the technology by streamlining the
process. It involves describing the sequences of operations, tasks,
machines, tools, people, and supplies involved in completing a
process (Hodge et al., 2003)
Organizational learning and change
• Most approaches to organizational change attempt to fix or change
portions of the organization.
• Even attempts to change the culture may only modify components of
the organization –changing values, beliefs, and expectations (Hodge
et al., 2003). It is true that some of these changes can be quite radical
and may result in more efficient and effective organization.
 Several organizational authorities agree on five attributes
of constitutes organizational learning
• First, a learning organization develops systematic approaches to problem
solving, developing an understanding of what works and what does not
work, learning from experience, and learning from the best practices of
others.
• Second, in a learning organization people must override past mental
models. Third, people in the learning organization must develop mastery,
including developing skills to be open with others.