Chapter 2 The Nature of Change
The chapter: Discusses a number of frameworks for categorising change. Explains why, in order to be effective, it is necessary to understand the differences between various types of change. 2
Emphasise the complex nature of organisational change; Describe and discuss the multi-dimensional nature of organisational change; Analyse change situations in order to choose appropriate methods of managing and implementing change; Recognise that there are limitations to the ‘common-sense’ approach to managing change that assumes that change can be planned as a logical. Step by step, sequence of activities. This because of cultural, political and leadership dynamics. 3
Background: A definition of strategy
the direction and scope of an organisation over the long term which achieves advantage for the organisation through its configuration of resources within a changing environment to meet the needs of markets and to fulfill stakeholder expectations. Source: Johnson, G. & Scholes, K. (1993) Exploring Corporate Strategy, London, Prentice Hall, p. 10.
Ansoff & McDonnel (1990) (recap) – Level 1. Predictable – Level 2. Forecastable by extrapolation – Level 3. Predictable threats & opportunities – Level 4. Partially predictable opportunities – Level 5. Unpredictable surprises Strebel (1996) – Weak forces – Moderate forces – Strong forces Stacey (1996) (recap) – Close to certainty – Far from certainty 5
Varieties of change (overview)
Grundy (1993) – Smooth incremental – Bumpy incremental – Discontinuous Tushman et al (1986) – Converging (fine-tuning) – Converging (incremental) – Discontinuous or frame-breaking Dunphy & Stace (1993) – Fine tuning – Incremental adjustment – Modular transformation – Corporate transformation 6
Varieties of change (Grundy)
Smooth incremental – evolves slowly, in a systematic and predictable way. Bumpy incremental – periods of relative quiet interrupted by sudden bursts in the rate of change (e.g. re-organisations). Discontinuous – ‘divergent breakpoint’, changes involving crisis, breakthrough, response to high turbulence.
Major Types of Change (Grundy)
Rate of change
Smooth incremental Bumpy incremental
Source: Grundy, T. (1993) Implementing Strategic Change, Kogan Page, p. 25
Varieties of change (Tushman et al)
Converging (fine-tuning) - trying to do better what is already being done well. Converging (incremental adaptation) - small changes in response to small shifts in the environment. Discontinuous or frame-breaking – major, rapid (spread over 18-24 months) and revolutionary changes in strategy, structure, people & processes in order to meet radically new or different circumstances. Also termed ‘upheaval.’ Most organisations follow a pattern of convergence/upheaval cycles. This pattern can apply at all levels (department, unit, corporation). 9
Pressures for Frame-breaking Change
Industry discontinuities, e.g. sharp changes in the legal, political or technological conditions which shift the basis of competition Product life-cycle shifts, i.e. strategic change to fit the next stage of the cycle Internal dynamics, e.g. new management team, with different strategy preferences
Examples of Frame-breaking Change
Change of mission or core values Power shifts, resource reallocation Total reorganization New workflow procedures New CEO coming from outside
Scale of change (1) (Dunphy & Stace)
1. Fine Tuning.
At departmental level. Making re-alignments to ensure that there is a match between strategy, structure, people and processes.
2. Incremental Adjustment.
Bit by bit changes to match the changing environment. Minor modifications to strategies or structures….. 12...