Textbook Notes - Chapter 16

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University of Toronto Scarborough
Management (MGH)
Joanna Heathcote

MGTB27 01 Week 13 Chapter 16 Organizational Change, Development, and Innovation (pg. 529 559) - Best Buy implemented period changes in strategy and culture to foster growth and innovation The Concept of Organizational Change - Common experience indicates that organizations are far from static and that change is not neither good or bad but rather how change is implemented and managed that is important Why Organizations Must Change - There are two basic sources that pressure organizations to change: external & internal sources - Environmental changes must be matched with organizational changes if the organization is to remain effective (e.g. The turntable market virtually disappeared due to CD players) - The external environment can also increase the competitiveness of business brought on by a more global economy, deregulation, and advanced technology (organizations are forced to be competitive by being leaner and meaner) - Internal factors such as low productivity, conflict, strikes, sabotage, high absenteeism and turnover signal that change within an organization is necessary - Often times, internal forces for change occur in response to organizational changes designed to deal with the external environment (e.g. after merger & acquisition, culture clashconflict) - When thre,9L8507.0L;0-9K047J,3L],9L439K02,:31700]08.,39K003;L7432039147 solutions then use the threat as a motivator for change - Some organizations may be paralyzed by the threat, behave rigidly, and exhibit inactivity - Change almost always needs investment of resources such as: money, management time, modifications of routines and processes (if these prerequisites are missing, inactivity occurs) - %K00J700470[903941.K,3J0;,7L080503L3J43K4Z3,2L.,347J,3L],9L438 environment is (e.g. if in a dynamic environment, need more change to be effective) - If organization exhibit too much change or too little change, this is can be ineffective What Organizations Can Change - Choice of what needs to be changed within an organization depends on a well-informed analysis of the internal and external forces. Factors that can be changed include: o Goals and strategies Changing goals and the strategies they use to reach these goals E.g. expansion, introducing new products and pursuit of new markets o Technology Technological change can vary from minor (e.g. introducing online portal) to major (e.g. moving from a rigid assembly line to flexible manufacturing) o Job design Redesigning jobs to offer more or less variety, autonomy, identity, feedback... o Structure Organizations can be modified by tallness, span of control, networking, centralization, formalization, and changing from functional to product form o Processes Basic processes of how work is accomplished may be changed E.g. some stages in a project can be done concurrently rather than sequentially o Culture Changing an organizational culture is critical since one of the main reason of reported failure of organizational change is failure to change the culture www.notesolution.comMGTB27 02 Week 13 Consider to be a fundamental aspect of organizational change since it provides an organization with a competitive advantage and long-term effectiveness o People Membership of an organization can be changed in two senses: N Revise the hiring process to take advantage of diverse labour pool N Introduce training and development methods to existing members - A change in one area often calls for changes in others and failure to recognize this can lead to severe problems (e.g. a company wants to expand so they may have to consider major structural changes and decentralization of decision-making power) - Changes in goals, strategies, technology, structure, process, job design, and culture require organizations to give serious attention to people changes (those who are affected by change) The Change Process - Psychologist Kurt Lewin suggest that the sequence or process of changing an organization involves three basic stages unfreezing, changing, and refreezing - Unfreezing o Unfreezing is recognizing that some current state of affairs is unsatisfactory o E.g. recognizing present structure, task design, or technology is ineffective o Crises are likely to stimulate unfreezing (e.g. dramatic drop in sales, big lawsuit) o Unfreezing can also occur without crisis where employee attitude surveys, customer surveys, and accounting data can be used to anticipate a crisis before it is reached - Change o Change is the implementation of a program or plan to move the organization or its members to a more satisfactory state o Change efforts can range from minor (e.g. simple skills training; only a few members are affected) to a major (e.g. extensive job enrichment, radical restructuring) o Research showed that those who were more strongly identified with the organization showed interest in the details of the change process while those who identified less strongly were more concerned with the outcomes of the change - Refreezing o Refreezing is the condition that exists when newly developed behaviours, attitudes, or structures become an enduring part of the organization o Effectiveness of change can be examined and desirability to extend change discussed o Refreezing is a relative and temporary state of affairs o %K070K,8-0032:.K0-,90,-4:90ZL388L25O0240O41.K,3J0,55OL3J941L728 that are hyper-turbulent (constantly changing, unpredictable), to achieve a seamless 2475KL3J7,9K079K,3,8905-like process change, organizational learning is used The Learning Organization - Organizational learning is the process through which an organization acquires, develops, and transfers knowledge throughout the organization - There are two methods of organizational learning: o Knowledge acquisition acquisition, distribution, and interpretation of knowledge that already exist but which is external to the organization o Knowledge development- development of new knowledge that occurs in an organization through dialogue and experience - Organizational learning occurs when organizational members interact and share experience & knowledge, & through the distribution of new knowledge & info throughout the organization www.notesolution.com
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