Organizational Behavior
managing change
Tomáš Ondráček
ondracek.t@mail.muni.cz
Faculty of Economics and Administration, Masaryk University
2023
Introduction
Introduction
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Introduction
questions
How changes occur?
How to analyze change?
a process perspective
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Process models
Process models
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Process models
Sources
open system theories
thinking about organizations (and parts of organizations) as
a system of interrelated components that are embedded in,
and strongly influenced by, a larger system
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Types of Process Theories
Types of Process Theories
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Types of Process Theories
Sources
Life cycle theories
Teleological theories
Dialectical theories
Evolutionary theories
Van de Ven and Poole (1995)
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Types of Process Theories
Process Theories of Organizational Development
and Change
(Van de Ven & Poole, 1995: 520)
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Types of Process Theories
A life-cycle model
A life-cycle model depicts the process of change in an entity
as progressing through a necessary sequence of stages.
An institutional, natural, or logical program prescribes
the specific contents of these stages.
motor:
A singular, discrete entity exists that undergoes change,
yet maintains its identity throughout the process.
The entity passes through stages distinguishable in form
or function.
A program, routine, rule, or code exists in nature, social
institutions, or logic that determines the stages of development
and governs progression through the stages.
(Van de Ven & Poole, 1995: 520–521, 525)
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Types of Process Theories
A teleological model
A teleological model views development as a cycle of goal
formulation, implementation, evaluation, and modification
of goals based on what was learned by the entity. This sequence
emerges through the purposeful social construction among
individuals within the entity.
motor:
An individual or group exists that acts as a singular, discrete
entity, which engages in reflexively monitored action to socially
construct and cognitively share a common end state or goal.
The entity may envision its end state of development before or
after actions it may take, and the goal may be set explicitly or
implicitly. However, the process of social construction or sense
making, decision making, and goal setting must be identifiable.
A set of requirements and constraints exists to attain the goal,
and the activities and developmental transitions undertaken by
the entity contribute to meeting these requirements and
constraints.
(Van de Ven & Poole, 1995: 520–521, 525)
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Types of Process Theories
A dialectical model
In dialectical models of development, conflicts emerge between
entities espousing opposing thesis and antithesis that collide to
produce a synthesis, which in time becomes the thesis
for the next cycle of a dialectical progression. Confrontation and
conflict between opposing entities generate this dialectical
cycle.
motor:
At least two entities exist (each with its own discrete identity)
that oppose or contradict one another.
The opposing entities must confront each other and engage
in a conflict or struggle through some physical or social venue,
in which the opposition plays itself out.
The outcome of the conflict must consist either of a new entity
that is different from the previous two, or (in degenerate cases)
the defeat of one entity by the other, or a stalemate among
the entities.
(Van de Ven & Poole, 1995: 520–521, 525)
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Types of Process Theories
An evolutionary model
An evolutionary model of development consists of a repetitive
sequence of variation, selection, and retention events among
entities in a designated population. Competition for scarce
environmental resources between entities inhabiting
a population generates this evolutionary cycle.
motor:
A population of entities exists in a commensalistic relationship
(i.e., in a physical or social venue with limited resources each
entity needs for its survival).
Identifiable mechanisms exist for variation, selection,
and retention of entities in the population.
Macropopulation characteristics set the parameters for microlevel
variation, selection, and retention mechanisms.
(Van de Ven & Poole, 1995: 520–521, 525)
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Types of Process Theories
Reactive sequences
subsequent events challenge rather than reinforce earlier events
the importance of working on support
(Hayes, 2014: 8–9)
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Self-reinforcing sequences
Self-reinforcing sequences
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Self-reinforcing sequences
Self-reinforcing sequences
Increasing returns
Psychological commitment to past decisions
Cognitive biases and interpretive frames
(Hayes, 2014: 8–9)
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Self-reinforcing sequences
Increasing returns
Set-up costs
Learning
Coordination
Betting on the right horse
(Arthur et al., 1994)
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Self-reinforcing sequences
Psychological commitment to past decisions
escalation of commitment
Gambler’s Fallacy
protection of self
conistency
naïve theory of chance
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Self-reinforcing sequences
Cognitive biases and interpretive frames
Confirmation bias
Framing effect
Default effect
...
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Path Dependence
Path Dependence
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Path Dependence
Path dependence
preformation phase
path formation phase
lock-in phase
(Sydow, Schreyögg, & Koch, 2009)
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Models
Models
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Models
characterization
(key) elements
(causal) relationships
outputs
(Hayes, 2014: 124–125)
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Models
use
description
interpretation
guidence
decision making
(Hayes, 2014: 125)
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Models
component and holistic models
part, element, person
the whole, complex
(Hayes, 2014: 125)
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Models
good models
relevance
recognition
usefulness
(Hayes, 2014: 142)
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Open Systems Theories
Open Systems Theories
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Open Systems Theories
characterization
embedded within a larger system
able to avoid entropy
regulated by feedback
subject to equifinality
cyclical in their mode of functioning
equilibrium seeking
bounded
(Hayes, 2014: 132)
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Kotter’s Integrative Model of Organizational Dynamics
Kotter’s Integrative Model
of Organizational Dynamics
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Kotter’s Integrative Model of Organizational Dynamics
Kotter’s integrative model of organizational
dynamics
((Hayes, 2014: 133) adapted from (Kotter, 1980: 282))
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Kotter’s Integrative Model of Organizational Dynamics
Kotter’s integrative model of organizational
dynamics
short term
imediate
medium term
months
long term
years
((Hayes, 2014: 133) adapted from (Kotter, 1980: 282))
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The McKinsey 7S Model
The McKinsey 7S Model
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The McKinsey 7S Model
The McKinsey 7S model
(Waterman Jr, Peters, & Phillips, 1980: 18)
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Weisbord’s Six-Box Model
Weisbord’s Six-Box Model
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Weisbord’s Six-Box Model
Weisbord’s six-box model
(Weisbord, 1976: 432)
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The Burke-Litwin causal model
The Burke-Litwin causal model
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The Burke-Litwin causal model
The Burke-Litwin causal model
of organizational performance and change
(Burke & Litwin, 1992: 528)
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Selecting a diagnostic model
Selecting a diagnostic model
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Selecting a diagnostic model
component and holistic models
???
(Hayes, 2014: 133)
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Patching
Patching
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Patching
patching
patching
Patching is the strategic process by which corporate executives
routinely remap businesses to changing market opportunities. It can
take the form of adding, splitting, transferring, exiting, or combining
chunks of businesses.
(Eisenhardt & Brown, 1999)
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Patching
patching and reorganizing
structure
stable vs. temporary
strategy
first vs. emerging
(Eisenhardt & Brown, 1999)
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Patching
patching: further characteristics
changes
small
frequent
size
agil
efficient
infrastructure
modular
fine grained metrics and complete
consistent compensation
quick
(Eisenhardt & Brown, 1999)
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Patching
patching: further characteristics
reorganization and patching
reorganization patching
role of change defensive reaction proactive weapon
scale of change sweeping small, some moderate, a few large
frequency rare ongoing
formalization every change is unique
change process is routine
and follows standards patching moves
driver of change get business focus right get business focus and size right
precision
optimal restructuring
at specific point in time
roughly right realingments over time
metrics
collect fine-grained metrics
only for infrequent reorganizations
reguĺarly trasck extensive,
fine-grained metrics on modular business
compensation not relevant companywide parity
(Eisenhardt & Brown, 1999)
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Patching
patching: examples
Hewlett-Packard
small
frequent
3M
agil
efficient
Johnson & Johnson
modular
fine grained metrics and complete
consistent compensation
quick
(Eisenhardt & Brown, 1999)
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Patching
patching: principles
Do it fast.
Develop multiple options, then make a roughly right choice.
Take an organizational test-drive.
Get the general manager right.
Script the details.
(Eisenhardt & Brown, 1999)
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Patching
patching: blocks
"missing the hill"
"Snow White and the Seven Dwarfs"
(Eisenhardt & Brown, 1999)
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Gartner Hype Cycle
Gartner Hype Cycle
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Gartner Hype Cycle
Gartner Hype Cycle
(Gartner, 2020)
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Gartner Hype Cycle
core activities
recognizing and starting
diagnosing and formulating
planning
implementing and reviewing
sustaining
leading and managing
learning
(Hayes, 2014: 436)
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Due Diligence
Due Diligence
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Due Diligence
range and complexity of issues
an industry and competitor analysis
a product and market analysis
an assessment of the target’s management talent
an analysis of management fit
an assessment of potential synergies and technical issues
a review of the terms and conditions of employment
an assessment of the compatibility of pension funds and so on
(Hayes, 2014: 438)
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Due Diligence
fragmentation of the data collection
external help
strategic fit
practical implementation
(Hayes, 2014: 438)
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Due Diligence
access to information and resources
obstacles
insufficiency
ignorance
time
(Hayes, 2014: 438)
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Psychological Issues
Psychological Issues
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Psychological Issues
mindset
leader
team
shareholders
stakeholders
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Psychological Issues
communication planning
to maximize the likelihood of successful communication
to coordinate the communication of ‘secrets’
to coordinate internal and external messages
to provide a contingency plan
(Hayes, 2014: 443)
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Psychological Issues
managing stakeholders
Aligning and coordinating
Promoting trust and procedural justice
Responding to pressure to deliver quick wins
socioemotional support
(Hayes, 2014: 446–448)
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Problems and Obstacles
Problems and Obstacles
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Problems and Obstacles
types of problems I/II
practical
theoretical
procedural
evaluation
moral
personal
non-personal ...
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Problems and Obstacles
types of problems II/II
well-defined vs. unknown or insufficiently defined
routine vs. unexpected
real generic
generic for an institution
real unique
first of many
konvergent
divergent ...
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Change Management Indicator Model
Change Management Indicator
Model
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Change Management Indicator Model
Change Management Indicator Model
(SARA32, 2020)
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Change Management Indicator Model
COVID
What about routines?
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Change Management Indicator Model
COVID: Routines
(Young, 2020)
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Change Management Indicator Model
questions
How to implement change?
How to review change?
How to make change stick?
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Two Main Approaches
Two Main Approaches
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Two Main Approaches blueprint changes
blueprint changes
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Two Main Approaches blueprint changes
blueprint changes
a clear action plan
↓
a vision
implementation
rolling plan
monitoring the effect of interventions
taking corrective action (learning)
the validity: a matter of course
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Two Main Approaches emergent changes
emergent changes
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Two Main Approaches emergent changes
emergent changes
generally defined goals
a general direction of change
↓
a vision
implementation
an open approach
adaptations and revisions
double-loop learning
challenging assumptions to support the change plan
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Monitoring
Monitoring
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Monitoring
Hypotheses
cause and effect
(Kaplan, Kaplan, Norton, Norton, & Davenport, 2004)
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Monitoring
Hypotheses
undestandable
clear
measurable
(Kaplan et al., 2004)
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Monitoring
Monitoring: Questions
Are interventions being implemented as intended?
Are interventions producing the desired effect?
Is the change plan still valid?
(Hayes, 2014: 452–453)
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Monitoring
Problems
the braking factors
founding
deviations and deflections
external factors
(Van de Ven & Poole, 1995: 520)
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Measuring
Measuring
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Measuring
performance
balance scorecards
Financial measures
Customer-related measures
Internal business process measures:
Innovation and learning
(Kaplan, Kaplan, Norton, & Norton, 1996)
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Responses
Responses
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Responses
Change Management Indicator Model
(Hayes & Hyde, 2016: 2)
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Sustainability
Sustainability
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Sustainability
Definitions
static
dynamic
(Van de Ven & Poole, 1995: 520–521, 525)
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Sustainability
Issues
perception
implementation
timing, sequencing, and pacing
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Sustainability
Problems
Those who initiated the change move on
Accountability for development becomes diffused
Knowledge and experience of new practices is lost through turnover
Old habits are imported with recruits from less dynamic
organizations
The issues and pressures that triggered the change initiative are no
longer visible
New managers want to drive their own agenda
Powerful stakeholders are using counter-implementation tactics to
block progress
Pump-priming funds run out
Other priorities come on stream, diverting attention and resources
Staff at all levels suffer initiative fatigue and enthusiasm for change
falters.
((Buchanan, Fitzgerald, & Ketley, 2007) via (Hayes, 2014: 474))
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Eisenhardt, K. M., & Brown, S. L. (1999). Patching. Restitching business portfolios in dynamic markets. Harvard
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https://www.gartner.com/en/research/methodologies/gartner-hype-cycle
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animals-funny-stick-with-me-change-is-happening
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