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Managing Organizational Change - CRF online

Managing Organizational ChangeBy Michael W. Durant, CCE, CPAThe increased pace of Change that many of us have encountered over the past ten yearshas been dramatic. During the late 1980s, many of us were grappling with issues that wehad never encountered. The accelerated use of leverage as a means of increasingshareholder wealth left the balance sheet of some of America s finest organizations indisarray. Many of our largest customers, that for years represented minimal risk andrequired a minimum amount of time to manage, consumed most of our energy. By the endof 1993, many of these organizations had either resolved their financial troubles inbankruptcy court or no longer as we began to think the external environment would settle down and ourprofessional lives would return to a normal pace, many of our organizations initiatedefforts to improve operating efficiency to become more competitive in the has heated up across the board. To succeed, the organization of the futuremust serve customers better, create new advantages and survive in bitterly contestedmarkets.

The second stage of the change process consist of incorporating new behaviors into organizational processes. Behavior and ideas that are embedded in the corporate culture

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Transcription of Managing Organizational Change - CRF online

1 Managing Organizational ChangeBy Michael W. Durant, CCE, CPAThe increased pace of Change that many of us have encountered over the past ten yearshas been dramatic. During the late 1980s, many of us were grappling with issues that wehad never encountered. The accelerated use of leverage as a means of increasingshareholder wealth left the balance sheet of some of America s finest organizations indisarray. Many of our largest customers, that for years represented minimal risk andrequired a minimum amount of time to manage, consumed most of our energy. By the endof 1993, many of these organizations had either resolved their financial troubles inbankruptcy court or no longer as we began to think the external environment would settle down and ourprofessional lives would return to a normal pace, many of our organizations initiatedefforts to improve operating efficiency to become more competitive in the has heated up across the board. To succeed, the organization of the futuremust serve customers better, create new advantages and survive in bitterly contestedmarkets.

2 To stay competitive, companies must do away with work and processes thatdon t add hypercompetition has invalidated the basic assumptions of sustainable are few companies that have escaped this shift in competitiveness. Entry barriers,which once exerted a stabilizing force on competition, have fallen in the face of the rapidchanges of the information age. These forces have challenged our capacity to cope withorganizational White WaterThings are not going to settle down. Many things we used to take for granted areprobably gone forever. We cannot predict with any certainty what tomorrow will be like,except to say that it will be different than Vaill has captured the essence of the problem of a continuously changing context ina compelling image - permanent white water. In the past, many of us believed that byusing the means that were under our control we could pretty much accomplish anythingwe set out to do. Sure, from time to time there would be temporary disruptions.

3 But thedisruptions were only temporary, and things always settled back down. The mental imagegenerated by these thoughts is that of a canoe trip on a calm, still , Vaill explains, in today s environment, we never get out of the rapids. As soonas we digest one Change , another one comes along. Usually there are many changesoccurring simultaneously. We have limited control over the environment, but to navigatethe rapids we must exercise skill. The permanent white water image has a strong visualappeal, conveying as it does a sense of energy and providing a visual sense of navigatingon an unpredictable wild the VisionVision and leadership drive successful Change . As the Change agent, first you must create avision of the future that is capable of focusing the group s energy. The vision shouldcontrast what is with what can be and it must be comprehensive enough to directattention at how to bridge the gap to the must become a core Organizational value using customer feedback, internallydeveloped Organizational improvements and other external feedback.

4 Change initiativesshould also be linked to efforts to improve overall performance and from senior management at the earliest stages of the Change process isrequired. Managing Change effectively requires an understanding of the variables at play,and adequate time must be allowed for Stages of ChangeTo thrive in the chaotic world we live in, we must embrace strategies that have beendeveloped to successfully manage Change . The theory and practice of organizationalchange contains elements of both behaviorist and cognitive learning theories. Aninvestigation into Change within an Organizational setting reveals a three-stage process ofunfreezing, Change and is the first stage of the Change process and consist of unlearning past Change process begins when the organization experiences is experienced in the form of cognitive dissonance. Cognitive dissonanceis a concept taken from the field of psychology that refers to incompatibility betweentwo or more attitudes or between behavior and attitudes.

5 Inconsistencies from the desiredstate are uncomfortable and we try to reduce the dissonance and thus the may be caused by external pressures or convincing data from within theorganization. An external example might occur due to pressure applied to seniormanagement by shareholders to increase the return on their investment. Dissonance maybe generated by internal benchmarking research that reveals areas in the organization thatrequire attention. If the factors creating the dissonance are relatively important thepressure to correct the imbalance will be a potential problem surfaces an information search begins to determine what actionis required to resolve the issue. If a problem exists, creative solutions are for unlearning develops when existing systems are challenged. Unfreezinginvolves dismantling past second stage of the Change process consist of incorporating new behaviors intoorganizational processes. Behavior and ideas that are embedded in the corporate culturemust be replaced.

6 Redirecting people s attention is an essential part of Change . Thedevelopment of skills to enable people to do things differently is required. Training mustbe provided to insure that employees understand their roles in making Change and people must be aligned to support Change . Skills and competencies toenable people to do things differently must be developed. Employees must understandthe dynamics of the Change process and also the functional requirements of the rules and policies that reinforce the desired ways of operating must be created anddocumented. Old customs and norms that reinforce the old ways of doing things must bereplaced with norms that reinforce the new ways. For example, if the organization isdeveloping teams and moving away from functional departments, then team work acrossdepartmental boundaries should be emphasized. Rewards should be specific to the changegoals that have been is the final stage of the Change process.

7 It is comprised of reinforcing andmeasuring behavior Change . After the training requirements are defined, the rewardsystem, reporting relationships and other systems can be designed to reinforce the the Change process requires certain behaviors from employees, then performanceappraisals, promotions and bonuses should be based on the desired performanceoutcomes. Creating objective measures for performance will demonstrate yourcommitment to the Change Phases of ChangeOrganizational Change has an element of loss inherent in the process, and it is a loss that isoften deeply felt by employees. The Kubler - Ross Grief Model addresses the emotionalissues associated with Change . The four emotional states experienced throughout thechange process may be expressed by employees in behaviors that are obstacles to theprocess of Change . By understanding the emotions employees often encounter duringchange, you will be better prepared to facilitate the Change - Ross Grief ModelStage 1 DenialStage 2 ResistanceStage 3 ExplorationStage 4 CommitmentThe first emotional state experienced during Change is denial.

8 For example, employeesencountering a Change initiative might be saying to themselves, I can t believe this ishappening to us. Unresolved fears about the Change initiative need to be addressed duringthis phase. Fear and mistrust need to be replaced by acceptance. To be an effective changeagent, you should encourage acceptance to Change by initiating trust-building second emotional state is resistance to the Change process. It is common foremployees to begin to resist the Change initiative. During this phase, employees attemptto slow down or derail the Change initiative. You must be able to spot resistance when itoccurs and formulate sound strategies for overcoming is a natural reaction to Change , and it can take many forms. The easiest form ofresistance to recognize is those who loudly indicate their dissatisfaction with the changestaking place in the organization. Soliciting feedback from these individuals lets you knowwhere they stand, so that you can overcome their often resist Change through denial.

9 These individuals refuse to acknowledgethat a problem exists. For example, competition might force a business to organize workaround processes to improve operating efficiencies. Functional departments involved inthese processes would be combined. Employees might not see a need for this Change . Thereasons for Change must be fully explained so that employees understand why it isnecessary to embrace the common resistance is exhibited by individuals who willingly embrace the Change ,but when they realize that it takes additional time and effort, they begin to undermine thechange process. It is best to slow down and allow people to absorb Change graduallybefore forging employees use confusion to postpone Change . After explaining the changesrepeatedly, employees ask the same questions over and over again. They may truly beconfused or they may be using confusion as a form of resistance to avoid most dangerous form of resistance is referred to as malicious compliance.

10 Employeesenthusiastically support Change , but covertly undermine the effort. For example, duringpresentations, the questions are polite and employees seem accepting. As you moveforward they act as though they are implementing the new program. Months later youfind out nothing has we respond to resistance is very important. Forcing compliance may increaseresistance. Those affected by the Change probably know a lot about what is required toimplement something new, and their input is important to the Change process. The degreeto which employees will support your new initiatives depends on how many of theirrecommendations are used. Compromise can accelerate the Change third emotional state encountered is exploration. If employees are unable to stop thechanges from occurring, they begin to explore their new roles. Both individual roles aswell as the overall role of the group are specifically defined in this stage. During theexploring stage, it is important that unresolved issues that continue to surface beaddressed.


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