8-1 Innovation and Change © 2006 by South-Western, a division of Thomson Learning. All rights reserved. Chapter 8.

8-1

Innovation and Change

© 2006 by South-Western, a division of Thomson Learning. All rights reserved.

Chapter 8

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Learning Objectives1. Define organizational change and explain the forces for

change.

2. Describe the sequence of four change activities that must be performed for change to be successful.

3. Explain the techniques managers can use to facilitate the initiation of change in organizations, including idea champions, new-venture teams, idea incubators, and open innovation.

4. Define the sources of resistance to change.

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Learning Objectives (contd.)

5. Explain force-field analysis and other implementation tactics that can overcome resistance to change.

6. Discuss the differences among technology, product, structure, and culture/people changes.

7. Explain the change processes – bottom up, top down, horizontal – associated with each type of change.

8. Define organizational development and large-group interventions.

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Two Types of Planned Change

Incremental Changebased on efforts to improve basic work and organizational processes.

Transformational Changeinvolves redesign and renewal of

the total organization.

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Ex. 8.1 Model of Change Sequence of Events

Environmental Forces

Internal Forces

ImplementChange

InitiateChange

Need forChange

Monitor global competition,customers, competitors,and other factors.

Consider plans, goals,company problems, andneeds.

Evaluate problems andopportunities, defineneeded changes intechnology, products,structure, and culture.

Facilitate search,creativity, ideachampions, skunkworks, and idea incubators.

Use force-fieldanalysis, tactics forovercomingresistance.

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Need for Change

Based on external or internal forces. Performance gap—a disparity between

existing and desired performance levels.

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Initiating Change -- Search The process of learning about current

developments inside or outside the organization that can be used to meet a perceived need for change

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Initiating Change -- Creativity The generation of novel ideas that may meet

perceived needs or offer opportunities for the organization.

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Idea Champion

A person who sees the need for and champions productive change within the organization.A person who sees the need for and champions productive change within the organization.

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Promoting Corporate Innovation

New-Venture Teams Skunkworks Idea Incubator

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Resistance to Change

Self-Interest: the fear of personal loss is perhaps the biggest obstacle to organizational change.

Lack of Understanding and Trust: do not understand the intended purpose of a change, or distrust the intentions.

Managers and employees often seem to prefer the status quo.

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Resistance to Change (contd.)

Uncertainty: the lack of information about future events.

Different Assessments and Goals: people who will be affected by innovation may assess the situation differently.

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Ex.8.4 Using Force-Field Analysis to Change from Traditional to Just-In-Time Inventory System

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Ex. 8.6 Types of Organizational Change

Technology Strategy

Structure

Products

Culture/People

SOURCE: Based on Harold J. Leavitt, “Applied Organizational Change in Industry: Structural, Technical, and Human Approaches,” in New Perspectives in Organization Research, ed. W. W. Cooper, H. J. Leavitt, and M. W. Shelly II (New York: Wiley, 1964), 55-74.

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Technology Change

Related to organization’s production process. Designed to enhance efficiency. Generally “Bottom-Up.”

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Tools for Changing People & Culture

Organizational development.

Training and development programs.

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Organizational Development

… is a planned, systematic process of change that uses behavioral science knowledge and techniques to improve an organization’s health and effectiveness through its ability to adapt to the environment, improve internal relationships, and increase learning and problem-solving capabilities.

… is a planned, systematic process of change that uses behavioral science knowledge and techniques to improve an organization’s health and effectiveness through its ability to adapt to the environment, improve internal relationships, and increase learning and problem-solving capabilities.

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Organizational Development (contd.)

Can help managers address: mergers/acquisitions. organizational decline/revitalization. conflict management.

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Achieving Behavioral and Attitudinal Change

Unfreezing: diagnosis stage. participants are made aware of problems in order

to increase their willingness to change their behavior.

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Achieving Behavioral and Attitudinal Change (contd.)

Changing: intervention stage. individuals experiment with new workplace

behavior.

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Achieving Behavioral and Attitudinal Change (contd.)

Re-freezing: reinforcement stage. individuals acquire a desired new skill or attitude

and are rewarded for it by the organization.