Lecture 8 The Management of Organisational Change and Conflict

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Lecture 8The Management of Organisational
Change and Conflict
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Topics

• Nature of organisational change
• Key issues accelerating change (external and
  internal force)
• Areas of the organisation managers expect change
• Change management process
• Managing change
• Managing resistance to change
• Emotions accompanying change
• Overcoming resistance
• Leadership and successful change
• Managing conflict

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What is change? Why change?

• Change
• Any alteration of the status quo.
• Why change?

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Change and Organisational Life Cycle

• Life cycles
• Predictable stages of development organisations
  typically follow.
• Evolving through each stage requires
  organisational change to survive and grow,
  otherwise the organisation may cease to exist in
  an identifiable way.
• There are four life-cycle stages.

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Organisational Life Cycle
Entrepreneurial stage
Collectivity stage
Formalisation and control stage
Elaboration-of-structure stage
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Two change types

• Reactive change
• Change occurring when one takes action in
  response to perceived problems, threats,
  opportunities.
• Planned change
• Change involving actions based on a carefully
  thought-out process anticipating future
  difficulties, threats, opportunities.

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Key Issues Accelerating Change
competition
economy
technology
The organisation
Internal change factors
culture
jobs
politics
regulations
structure
employees
External change factors
technical development
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Areas for Change in an Organisation

• Changing structure
• Changing technology (ex automation,
  computerisation, E-commerce or E-business)
• Changing people (changing the quality and
  characteristics of employees)
• Changing Culture

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Areas for Change
Technology
Human Resources
Structure
Culture
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Areas for Change Structure

• Structural components
• Job definitions
• Job groupings
• Teams
• Delegation
• Reporting relationships

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Areas for Change Technology

• Technology may drive change/innovation by
• Requiring new work methods.
• Providing/removing competitive edge.

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Areas for Change People

• Human resources is the vehicle for changing
• knowledge, skills, perceptions behaviours
• needed for a job. It utilises
• Recruitment selection
• Training
• Performance appraisal
• Reward systems.

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Areas for Change Culture

• Major organisational changes often require
  concomitant changes to organisational culture.

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Change Management Process
Recognition of opportunity or problem
Prepare to overcome resistance
Line up powerful sponsors
Plan for reward visible progress
Develop and communicate a vision
Consolidate improvements facilitate further
change
Empower others to act out the vision
Monitor institutionalise change
Reading 8.4 covers detailed information on change
management process.
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Managing ChangeManaging Resistance To Change

• Why do employees resist change?
• Self-interest not fear change but fear loss
  (what are losses?)
• Security
• Competence do not know how to do with the new
  job
• Relationships afraid of the familiar contact
  with people like customers, co-workers or
  managers can disappear afraid of losing their
  sense of belonging to a team or group
• Sense of direction
• Territory
• It is important to understand employees fears of
  loss caused by change as it is a normal part of
  transition and leaders have to assist them
  overcome these fears.

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Why does individual resist change?

• Misunderstanding
• Lack of trust
• Differential assessment
• Ability to adjust
• Laziness

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What are emotions accompanying change?

• Disbelief
• Annoyance
• Avoidance
• Disappointment
• Blaming
• Given up
• Hostility and sabotage
• Acceptance
• Optimism

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Managing Resistance To Change

• Managing resistance to change
• Freeze cycle approach (Kurt Lewin 1947 )
• Unfreezing
• Initial awareness of need for change is
  developed
• Changing
• Focus on learning needed new behaviours
• Freezing
• Reinforcing new learned behaviours by positive
  results, feelings of achievement, and rewards
  from others.

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Managing Resistance To Change
THREE-STEP PROCESS
CHANGE
UNFREEZE
REFREEZE
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Managing Resistance To Change

• Overcoming resistance

Participation involvement
Education communication
METHODS (Kotter Schlesinger)
Facilitation support
Explicit implicit coercion
Negotiation agreement
Manipulation cooptation
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Managing Resistance To Change
Overcoming resistance to change
Force -Field Analysis (Kurt Lewin) a method
involving analysing the two types of forces,
driving forces and restraining forces, that
influence any proposed change, then assessing
how best to overcome resistance.
C H A N G E
Driving forces Factors pressuring for a
particular change
Restraining forces Factors pressuring against a
change
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Managing Resistance To Change

• Driving forces are factors pressuring for a
  particular change
• Restraining forces are factors pressuring against
  a change
• The status quo is a condition of equilibrium
  between the two forces
• Change occurs by increasing driving or reducing
  restraining forces that is reducing resistance to
  change

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Restraining forces against change
Driving forces for change
Deteriorating company-union relations
Good union relations
Stringent work rules
Foreign competition
Current benefit costs
Recent losses
Cheaper outside sources
Current pay costs
Union desire to save jobs
Employee absenteeism levels
Company reluctance to save jobs
Company desire for flexibility in layoff
decisions
Force-field analysis of the forces maintaining
high cost level at Xerox plant (p.587)
Desired low Cost level
Current high Cost level
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Change the culture fit

• Culture issue is the first issue needed to
  address before tackling any needed organisational
  change
• Ex James McNerney, previous employee of GE, took
  over as CEO of 3M and brought with him managerial
  approaches from GE.

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• Evidences show that successful culture change
• needs turnaround time for seven to ten
  years---need patient.
• The corporate CEOs were outsiders
• CEOs did started their jobs by trying to create
  an atmosphere of perceived crisis

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Ongoing challenge of making change successfully

• Change process do not always work the way they
  should, instead an organisation needs to embrace
  change, be ready for change all the time (be a
  change-capable organisation)
• Managers need to act as change agents (change
  leaders) and build an effective change agent team
• Get all organisational members involved-encourage
  employees to be change agents

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Leadership and Change

• People change being led, not from being told
• Visionary leadership is needed
• An energised leader will do more focus the
  efforts of his or her employees
• Understanding and articulating a vision of where
  the group is going
• Sharing that vision
• Creating an environment where employees feel a
  sense of making the vision come true (ex setting
  a plan of action)
• Creating incentives for change and rewards

Refer to Skills and competencies of a change
leader to know the Roles, responsibilities,
skills and competencies of a change leader.
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What is conflict?

• Conflict is the perceived difference between two
  or more parties resulting in mutual opposition.

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Conflicts between individuals and organisations

• Choices facing employees in conflict
• Leave organisation or work to climb into upper
  management
• Use defence mechanisms to defend their
  self-concepts
• Psychologically disassociate (lose interest in
  their work)
• Concentrate on material rewards
• Find allies resist (e.g. strike)

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Causes of conflict

• Communication factors
• Structural factors
• Size
• Participation
• Linestaff distinctions
• Reward systems
• Resource interdependence
• Task interdependence
• Power

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Causes of conflict (cont.)

• Personal behaviour factors
• Communication styles
• Workforce diversity
• Differences in goals
• Reward structures
• Differences in perceptions
• Increased demand for specialists

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Benefits losses from conflict

• BENEFITS LOSSES
• Productive task focus Energy diversion
• Cohesion satisfaction Distorted
  judgment
• Power feedback Loser effects
• Goal attainment Poor coordination

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Relationship between change and conflicts

• Types of intergroup conflict
• Functional
• Dysfunctional
• Changing views on conflict
• Traditional viewconflict is destructive
  unnecessary
• Modern viewconflict is inevitable, may produce
  better organisational performance
• Stimulating conflict
• Build group diversity, communicate to provoke
  change, encourage competition

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Managing intergroup conflict

• Changing situational factors leading to a problem
  (e.g. increase resources, redesign rewards)
• Appeal to superordinate goals (e.g. survival or
  beating competitors)
• Use interpersonal conflict-handling model.

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• Different styles of interpersonal conflict
  management and circumstances where each may be
  appropriate
• Forcing (formal authority, power use).
• Collaborating (combination of assertiveness and
  co-operation).
• Competing (reaction to non-competitive
  behaviour).
• Compromising (intermediate amounts of
  assertiveness and co-operation).
• Avoiding (neutrality).
• Accommodating (giving in to anothers wishes).

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Conflict-resolution techniques
Soure Robbins et al. 2006.
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Methods of resolving dysfunctional intergroup
conflict
Problem solving
Intergroup training
Expansion of resources
Intergroup conflict resolution
Confrontation negotiation
Smoothing
Bureaucratic authority
Limited communication
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Activities

• Case study Fremantle port, p.600
• Case study Which theory is that? Managerial
  dilemmas, textbook p.586.