ADMINISTRATION OF ORGANISZATIONAL CHANGES - 103408 chapter I 1 Introduction to administration of organizational changes
LEARNING OUTCOMES At the end of this chapter you will be able to understand and have knowledge about The definition of organization, organizational change. Forces of change internal forces, external forces. Resistance to change. Need for organizational change. Organizational change management (OCM). Strategies for change management. 2
WHAT IS AN ORGANISATION Organisation is defined as two or more individuals who are interacting with each other with a structured set up and working in as interdepandent way to achieve some common objective. Or An Organisation is a social group which distributes work for a collective goal. Or The arrangement of human and physical resources based upon the need to control and integrate the activities of individuals and groups. 3
WHAT IS ORGANIZATIONAL CHANGE? Organizational change is defined simply as: Changes in organizational behaviors and employee attitudes to move from a current state to a desired future state based upon external stimuli triggering the event. Changes in the external environment effect changes in a company s strategy, which drives technology, business processes, and organization 4
FORCES OF CHANGE Forces for change are two types Internal External 5
INTERNAL FORCES Change in size of organisation: Change in the organisation s size leads to change in the internal structure and complexity of the operations in organisation. Performance Gap: When a gap between a set target and actual result is identified. Organisation face the forces of change to reduce gap. 6
Employee needs and values: With changing needs and value of the employee, organisations change their policies. For example Financial incentives, challenging assignment. Change in top management: Change in top management and consequent change in the ideas to run the organisation also leads to change in the system, structure and process. 7
EXTERNAL FORCES Technology: Rate of technological change is greater today than job performes at all levels in organisation. Business Scenario: Rapid changes in the business scenario with increasing competition and the global economy, the need and demands are also changing among the customers, suppliers and stakeholders. 8
Environmental factor: Factors such as economics, political and demographic factors plays a major role in organisation policies and strategy. For example government taxation policy. 9
RESISTANCE TO CHANGE There are two types of resistance Individual Organisational 10
RESISTANCE TO CHANGE Individual resistance: Resist to change due to the fear of losing jobs, obsolescence of skills, change in the social relationship. For example technological change individual may lose job. Organisational resistance to change: Change may bring some potential threat to the organisational power to some people. Therefore organisation try to resist change. 11
NEED OF ORGANIZATIONAL CHANGE MANAGEMENT (OCM) The process of change management deals with the mechanisms of human transitions, the way personnel within an organization relate to change in their lives, and why some change efforts are successful while others fail. Successful change management and successful business management require effective integration and alignment of system and structure to support an effective culture. It requires attention to all major elements that impact organizational performance. 12
STRATEGIES FOR CHANGE MANAGEMENT There are four basic strategies adopted to manage change. Empirical Rational Normative-Re-educative Power-Coercive Enviromental-Adaptive 13
STRATEGIES FOR CHANGE MANAGEMENT Empirical Rational: People are rational and will follow their self-interest once a change is revealed to them. Change is based on the communication of information and their proferring of incentives. Normative-Re-Educative: People are social beings and adhere to cultural norms and values. Change is based on redifining and reinterpreting existing norms and values and developing people s commitments to new ones. 14
STRATEGIES FOR CHANGE MANAGEMENT Power-Coercive: People complaint and generally do what they are told or can be made to do. Change is based on the exercise of authority and the imposition of sanctions. Enviromental- Adaptive: People oppose loss and disruption, but they adapt readily to new circumstances. Change is based on building a new organisation and gradually transfering people from the old one to the new one. 15
Thank You 16