1.8 Change and the Management of Change
1.8 Change and the Management of Change
Change Management Planning, Implementing, controlling, and reviewing the movement of an organization from its current state to a new one
Causes of Change
External
Incremental (Evolutionary)
• Occurs slowly over time (fuel-efficient cars)
Dramatic (Revolutionary)
• Can cause many problems especially if unexpected
• Might lead to total rethink of operation of organization o Business Process Re-Engineering
Business Process
Re-Engineering Fundamentally rethinking and redesigning the processes of a business to achieve a dramatic improvement in performance
Nature of Change Examples Strategies for Management
Globalization-Increasing interdependence for countries’ economies through free trade and multinational company investment • New opportunities to sell products in other countries
• Increased competition from products made more cheaply in other countries-often by multinationals • Use either pan-global marketing for localization strategies
• Achieve and try to maintain a competitive advantage
Technological Advances-Leading to new products and new processes • Products: new computer games, iPods and iPhones, hybrid-powered cars.
• Processes: robots in production; computer assisted design (CAD) in design offices and computer systems for stock control. • Staff retraining
• Purchase of new equipment
• Additions to product portfolio-Other products may be dropped
• Need for quicker product development which may require new organizational structures and teams
Nature of Change Examples Strategies for Management
Macro-Economic Change-
Fiscal Policy, Interest Rates, Business Cycle • Changes in consumers’ disposable incomes-and demand patterns that result from this
• Boom or recession conditions-need for extra capacity or rationalism • Need for flexible production systems (staff flexibility) to cope with demand changes
• Explain need for extra capacity or need to rationalize
• Deal with staff cutbacks
Change Management Planning, Implementing, controlling, and reviewing the movement of an organization from its current state to a new one
Causes of Change
External
Incremental (Evolutionary)
• Occurs slowly over time (fuel-efficient cars)
Dramatic (Revolutionary)
• Can cause many problems especially if unexpected
• Might lead to total rethink of operation of organization o Business Process Re-Engineering
Business Process
Re-Engineering Fundamentally rethinking and redesigning the processes of a business to achieve a dramatic improvement in performance
Nature of Change Examples Strategies for Management
Globalization-Increasing interdependence for countries’ economies through free trade and multinational company investment • New opportunities to sell products in other countries
• Increased competition from products made more cheaply in other countries-often by multinationals • Use either pan-global marketing for localization strategies
• Achieve and try to maintain a competitive advantage
Technological Advances-Leading to new products and new processes • Products: new computer games, iPods and iPhones, hybrid-powered cars.
• Processes: robots in production; computer assisted design (CAD) in design offices and computer systems for stock control. • Staff retraining
• Purchase of new equipment
• Additions to product portfolio-Other products may be dropped
• Need for quicker product development which may require new organizational structures and teams
Nature of Change Examples Strategies for Management
Macro-Economic Change-
Fiscal Policy, Interest Rates, Business Cycle • Changes in consumers’ disposable incomes-and demand patterns that result from this
• Boom or recession conditions-need for extra capacity or rationalism • Need for flexible production systems (staff flexibility) to cope with demand changes
• Explain need for extra capacity or need to rationalize
• Deal with staff cutbacks