Change Management - Meaning and Important Concepts

A set-up where individuals from diverse backgrounds, different educational qualifications and varied interests come together to work towards a common goal is called an organization. The employees must work in close coordination with each other and try their level best to achieve the organization’s goals. It is essential to manage the employees well for them to feel indispensable for the organization. Organization management helps to extract the best out of each employee so that they accomplish the tasks within the given time frame. Organization management binds the employees together and gives them a sense of loyalty towards the organization.

What is Organization Management ?

• Organization management refers to the art of getting people together on a common platform to make them work towards a common predefined goal.
• Organization management enables the optimum use of resources through meticulous planning and control at the workplace.
• Organization management gives a sense of direction to the employees. The individuals are well aware of their roles and responsibilities and know what they are supposed to do in the organization.

An effective management ensures profitability for the organization. In a layman’s language organization management refers to efficient handling of the organization as well as its employees.

Need for Organization Management

• Organization management gives a sense of security and oneness to the employees.
• An effective management is required for better coordination among various departments.
• Employees accomplish tasks within the stipulated time frame as a result of effective organization management.
• Employees stay loyal towards their job and do not treat work as a burden.
• Effective organization management leads to a peaceful and positive ambience at the workplace.

Essential Features of Organization Management

1. Planning

   • Prepare an effective business plan. It is essential to decide on the future course of action to avoid confusions later on.
   • Plan out how you intend to do things.

2. Organizing

   • Organizing refers to the judicious use of resources to achieve the best out of the employees.
   • Prepare a monthly budget for smooth cash flow.

3. Staffing

   • Poor organization management leads to unhappy employees who eventually create problems for themselves as well as the organization.
   • Recruit the right talent for the organization.

4. Leading

   • The managers or superiors must set clear targets for the team members.
   • A leader must make sure his team members work in unison towards a common objective. He is the one who decides what would be right in a particular situation.

5. Control

   • The superiors must be aware of what is happening around them.
   • Hierarchies should be well defined for an effective management.
   • The reporting bosses must review the performance and progress of their subordinates and guide them whenever required.

6. Time Management

   • An effective time management helps the employees to do the right thing at the right time.
   • Managing time effectively always pays in the long run.

7. Motivation

• Motivation goes a long way in binding the employees together.
• Appreciating the employees for their good work or lucrative incentive schemes go a long way in motivating the employees and make them work for a longer span of time.

Kinds of Change and the Barriers to Changes

There are different kinds of change that an organization might undertake or be forced to undertake because of internal and external factors. The internal factors for change include reorganization and restructuring to meet the challenges of the future and also to act proactively to initiate change as a means of staying ahead of the competition. The external factors include change that is forced upon the organization because of falling revenues, changing market conditions and the need to adapt to the ever changing business landscape. Change can be organic which means that it evolves slowly and is like meandering up the gentle slope of a mountain. In this case, the organization and the management have enough time to prepare for change and reorient themselves accordingly. This is the kind of change that is adaptive meaning that firms have the opportunity to adapt themselves to the change.

Change can be radical which is rapid, sudden and uncertain. This is the kind of change that is disruptive and often forces organizations to reorient themselves without adequate notice and warning. It is better for organizations to anticipate change rather than be forced into accepting change that is rapid and sudden.

We have seen how managers at different levels resist change and how this resistance manifests itself. Apart from the ideological and personality issues, there is the very real possibility of change being resisted because the “visibility” of what comes next is not clear. For instance, many managers tend to resist change because the change initiators have not clearly spelt out the outcomes of the changes and the possible impacts that such changes have on the organization. This is the realm of the “known unknowns” and the “unknown unknowns” which arise because of ambiguity, complexity and uncertainty. Hence, the resistance to change can come about due to the lack of coherence in the vision and mission and because the change is not clearly communicated as well.

Finally, the rapidity with which change is introduced can upset the organization structures that are usually rigid and bureaucratic with bean counters at all levels resisting and actively thwarting change. Hence, it needs to be remembered that change initiators take into account all these factors when introducing changes. The possible approaches in dealing with these resistances would be discussed in the next section.

Global Financial Crisis and Organizational Change

Resistance to change is inevitable as there are many parties who stand to lose from change and apart from the status quoists there are vested interests who would oppose change. The changes that the organizations and the companies introduced in the wake of the global financial crisis were systemic and fundamental in nature and hence there would be many reasons for people and employees in these organizations to resist change. The primary reason why the people would resist change is that because of job losses and the associated risks of layoffs and restricting, they stand to lose and hence there is a strong element of resistance that enters the discussion. Since the organizations in Australia undertook drastic changes to the way they worked, the people working in these organizations have every reason to resist the changes because they are at the losing end of the changes and hence have a stake in resisting change. This goes for the majority of people who were affected by the downturn and whose jobs and careers were at stake because of the global financial crisis.

The other reason for people or organizations to resist change is that the global financial crisis was systemic in nature and hence called for fundamental changes in which the system operated. This meant that the people or organizations at the receiving end of these changes had to bear very drastic changes in the way they operated and hence those who gain by following the status quo had every reason to resist the change. This was especially the case with organizations that underwent restricting and cost cutting where though there were no drastic job losses, many of the perks and benefits for the employees were cut leading to widespread dissatisfaction and discontent with the kind of changes that were being proposed. Hence, this is the second most important reason for people or organizations to resist changes in the wake of the downturn caused by the global financial crisis.

The third reason why organizations resisted the changes in the aftermath of the global financial crisis is that many of the changes introduced led to regulatory and legal changes in the way organizations operated and hence there was every chance that these organizations had to implement rules and regulations that would curb excessive risk taking and speculation. Given the enormous benefits that these methods of risk taking and speculation bring to the people and organizations concerned, it is indeed the case that they would not be willing to forego these benefits. Hence, this is a very important reason for people and organizations to resist the changes introduced in the aftermath of the global financial crisis.

In conclusion, change is something that is constant but given the inherent tendency of the bureaucratic structures in organizations to resist change, there is always an element of resistance to change. Particularly when the changes are drastic as seen in the case of the global financial crisis, there tends to be steadfast opposition to change by the organizations and hence this is a fact of life that the change makers and the change agents have to factor in their strategies.

Role of Innovation in Change Management

We have seen how various factors contribute to the propagation of change within an organization. For instance, change can be catalyzed through change agents and can be driven from the top as well as from the bottom. In this article, we will look at the crucial role of innovation in driving change. For quite some time now, it has been known that companies need to innovate constantly if they are to stay ahead of the pack in terms of competitiveness. Innovation can take many forms and some of them are discontinuous innovation, continuous innovation and dynamically continuous innovation. We shall discuss what each mean in the next paragraph. Suffice to say that unless companies innovate they cannot move up the value chain and unless they move up the value chain, they cannot remain competitive. So, to make changes to the organizational processes and its strategy, companies need to innovate constantly. Innovation can produce sudden and dramatic changes to the way business is done and the way consumers experience changes to the products and services made by the companies.

This is the discontinuous innovation which is sudden and has a huge impact on the way the company goes about its business. On the other hand, innovation can be gradual and incremental which is the continuous innovation way which means that the company introduces refinements to its products so that consumers adjust and adapt in steps. Finally, there is the dynamically continuous innovation which affects the way in which the company adapts to changing market conditions and changes in consumer behavior trends to make a positive impact on the consumer psyche.

The point here is that no matter what kind of innovation the company adopts, the prerequisite for change management is innovation and without innovation, a company cannot expect its internal and external environment to be to its advantage. For instance, if Apple comes out with its new iPhone and disrupts the way in which consumers perceive a phone, it is discontinuous innovation. If Apple modifies its iPhone in a dynamic manner according to the changing customer preferences, it is dynamically continuous innovation. If it releases its iPhone after minor tweaks, then it is continuous innovation. For Apple to make a mark in the customer experience, it has to keep changing continuously and hence has to innovate constantly to keep abreast of the consumer trends and the competition.

An example of a company that constantly strives to be the best when it concerns change and innovation is 3M Corporation. This company is known for its world class innovation teams which drive change throughout the company and keep its consumers happy and its competitors on their toes. The way in which 3M drives innovation to produce change is indeed exemplary and worthy of emulation. Hence, innovation should be the mantra for companies wishing to change their internal environments and in the process change the way they project themselves in the external marketplace.

In conclusion, we are living in times where the rapid turnover of ideas and products in the marketplace has reached a stage where it is no longer enough to be best in the class. Instead, the pursuit of excellence and the search for excellence are the hallmarks of a truly successful and world class company and hence all companies must undertake efforts to drive innovation and change within and without.