MGMT5 © 2012 Cengage Learning Innovation and Change 7.

MGMT5

© 2012 Cengage Learning

Innovation and Change7

© 2012 Cengage Learning

1. explain why innovation matters to companies

2. discuss the different methods that managers can use to manage innovation in their organizations effectively

3. discuss why not changing can lead to organizational decline

4. discuss the different methods that managers can use to better manage change as it occurs

Organizational Innovation

1. explain why innovation matters to companies

2. discuss the different methods that managers can use to manage innovation in their organizations effectively

© 2012 Cengage Learning

Technology Cycles

• Begins with the birth of a new technology…

• …ends when that technology reaches limit and dies.

© 2012 Cengage Learning

S-Curves and Technological Innovation

© 2012 Cengage Learning

Innovation Streams: Technology Cycles over Time

© 2012 Cengage Learning

Emergence of Dominant Design

• There are winners and losers– technological lockout

• Signals a shift from design experimentation and competition to incremental change

© 2012 Cengage Learning

Managing Innovation

• During discontinuous change, companies must find a way to anticipate and survive technological changes.

• Companies must also manage incremental change and innovation.

© 2012 Cengage Learning

Components of Creative Work Environments

© 2012 Cengage Learning

Experiential Approach

Assumes that innovation is occurring within a highly uncertain environment; the key to

fast product innovation is to use innovation, flexible options, and hands-on experience.

•Design iteration•Product prototype•Testing•Milestones•Multifunctional teams

© 2012 Cengage Learning

Compression Approach

Assumes that innovation is a predictable process, that incremental innovation can be planned, and that compressing the time it

takes to complete steps can speed up innovation.

•Generational change•Supplier involvement•Shorten the time of individual steps•Overlapping steps

© 2012 Cengage Learning

Organizational Change

3. discuss why not changing can lead to organizational decline

4. discuss the different methods that managers can use to better manage change as it occurs

© 2012 Cengage Learning

The Risk of Not Changing

Organizational declines occurs when companies don’t anticipate, recognize, neutralize, or adapt to the internal and external pressures that threaten their

survival. •Blinded stage•Inaction stage•Faulty action stage•Crisis stage•Dissolution stage

© 2012 Cengage Learning

Forces

• Change forces– lead to differences in the form, quality, or

condition of an organization over time

• Resistance forces– caused by self-interest, misunderstanding, and

distrust

© 2012 Cengage Learning

Resistance to Change

• Self-interest

• Misunderstanding and distrust

• General intolerance for change

© 2012 Cengage Learning

Organizational Change Process

• Unfreezing

• Change intervention

• Refreezing

© 2012 Cengage Learning

Managing Resistance to Change

• Educate employees• Communication change-relate d

information• Have those affected by change

participate in planning and implementing

• Let employees discuss and agree on who will do what after change

• Coercion

© 2012 Cengage Learning

Mistakes Managers Make

• Not establishing a great enough sense of urgency• Not creating a powerful enough coalition• Lacking a vision• Undercommunicating the vision by a factor of 10• Not removing obstacles to the new vision• Not systematically planning for and creating

short-term wins• Declaring victory too soon• Not anchoring changes in the corporation’s

culture

© 2012 Cengage Learning

Change Tools and Techniques

Results-driven change• supplants emphasis on activity with focus

on quickly measuring and improving results

General Electric Workout• three-day meeting that generates

solutions to specific business problems

© 2012 Cengage Learning

© 2012 Cengage Learning

General Steps for Organizational Development Intervention

© 2012 Cengage Learning

Different Kinds of Organizational Development Interventions

<click screenshot for video>

REELTOREAL

Field of Dreams

1. When someone suggests an idea to you that you don’t completely understand, how open are you to considering it?

2. Which character is the most resistant to the idea of changing the farm into a ball field? Why?

3. Which characters demonstrate the most creativity and vision?

© 2012 Cengage Learning

<click screenshot for video>

REELTOREAL

Holden Outerwear

1. Identify the type of change that Holden’s leaders are managing on a daily basis.

2. What resistance has Holden encountered while introducing innovative garment designs? How was it able to overcome that resistance?

© 2012 Cengage Learning