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Causes of change

Organisations and their changing environments- Fleming and Sum (?)

The forces that operate to bring about change in organisation can be thought of as winds which are many and varied- from small summer breezes that merely disturb a few paper to might howling gales which cause devastation to structures and operations causing consequent reorientation of purpose and rebuilding. Sometimes however, the winds die down to give periods of relative calm, periods of relative organisational stability.

Environmental triggers of change

Nadler and Tushman (1988) summarised an organisation’s environment as: ‘All factors, including institutions, groups, individuals, events and so on, that are outside the organisation being analysed, but have a potential impact on that organisation.

The impact of PEST

Some analysts have found it useful to group different environmental factors into categories under the mnemonics PEST (Johnson and Scholes, 1999) and STEP (Goodman, 1995), both of which refer to political, economic, technological and socio-cultural factors that influence organisations, their strategies, structures and means of operating, including human resource practises.

Triggers for change from the technological environment

* Information technology
* The Internet
* New production processes (machines instead of humans, or working side by side) * Computerisation of processes
* Changes in transport technology

Triggers for change from the political environment

* Government legislation
* Government ideology
* International law
* Universal rights
* Wars
* Local regulations
* Taxation
* Trade union activities

Triggers for change from the economic environment

* Competitors
* Suppliers
* Currency exchange rates
* Employment rates
* Wage rates
* Government economic policies
* Other countries’ economic policies
* Lending policies of financial institutions
* Change from public to private ownership.

Triggers for change from the socio-cultural environment

* Demographic trends (customers and employees)
* Lifestyle changes
* Skills availability
* Attitudes to work and employment
* Attitudes to minority groups
* Gender issues
* Willingness and ability to move
* Concern for the environment
* Business ethics

Internal triggers for change

* An organisation becoming unionised or de-unionised
* A new chief executive or other senior managers
* A revision of administrative structures
* The redesign of a group of jobs
* The redesign of a factory or office layout
* The purchase of new IT equipment
* A new marketing strategy
* A cut in overtime working
* Staff redundancies
* Strengthening of specific departments such as research and development

A quick glance through the internal trigger list will show that almost all of them can be conceptualised as changes in response to influences external to the organisation. It is therefore, difficult in reality to separate completely internal from external triggers for change.

Organisational responses to change

Sadler (1989) said there are at least 3 types of environment, which make up the total operating environment:

1. Temporal environment- Historical developments bringing in changes over time. These range from those activities that are mainly industry focused to those which rely more on knowledge and brainpower- Handy (1994) calls this ‘focused intelligence’, the ability to acquire and apply knowledge and know-how. This can affect the firm in two ways: i) more generally, through the cycles of industry-based innovation, which moves firms through major series of developments. ii) More specifically, through the life cycle of the organisation itself- its particular history built up from the founder days through periods of expansion and decline

2. External environment- this involves the usage...
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