Strategic Management

Chapter 13

Managing Change and Innovation

What forces create the need for change?

External forces:o Marketplaceo Governmental Laws and Regulationso Technologyo Labour marketso Economic changes

Internal Forces:o Strategyo Workforceo Equipmento Employee Attitudes

Is change Episodic or Ongoing?

Calm waters suggests that change is episodic and can be planned and managed using

o Lewin’s 2 Step Change Model Unfreezing Changing Refreezing

White water rapids metaphor suggests that change is ongoing therefore

o Planning and managing must also be ongoing

How do managers manage organisational change?

Types of organisation change include:o Structural Change

Could be changes to structural component or structural design

o Technological Changes Could be changes to

Equipment Tools Operating methods

o Automationo Computerisation

o People Change Organisational development is used to change

people’s Attitudes Expectations Perceptions Behaviours

Change agents may be needed to act as a catalyst and to manage the change process

o May be a manager or non-managero May be internal or external

Resistance to change comes from o Fear of uncertaintyo Habito Concern over personal loss o Belief that change is not the organisation’s best interest

Managers can manage resistance by:o Educating and Communicationo Participationo Facilitation and Supporto Negotiationo Manipulationo Selecting people who accept changeo Coercion

Manages can understand the driving and resisting forces by using a Force-Field Analysis

What current issues are managers facing?

Changing organisational culture is difficulto Therefore conditions have to be favourable before

managers can implement change Managing downsizings means managers need to consider taking

actions to make the adjustments as painless as possible Handling employee stress (which the organisation often creates)

o Stress involves excessive pressure coming from Extraordinary demands, constraints,

opportunitieso There are ways for managers to reduce job-related

stress and to offer help for personal stress Make change happen successfully by

o Making the organisation ready for changeo Being a change leadero Increasing the role of others in implementing the

change

How can managers manage innovation?

Innovation and creativity are not the same.o Creativity: combining ideas in a unique war or making

unusual associations between ideas.o Innovation: turning the outcomes of the creative

process into useful products or work methods Input – Process – Output Perspective of Innovation Factors that affect innovation

o Structural variables: organic type structure Plentiful resources Frequent inter-unit communication Minimal time pressures Support for creative work from

Work Sources Non-work sources

o Cultural variables: Accept ambiguity Tolerate the impractical Keep controls to a minimum Tolerate risks and conflicts Focus on goals Monitor the environment Provide Positive Feedback

o Human Resource Variables: Training and development High job security Creative people (idea champions)

What are the change challenges in relation to sustainability?

Sustainability is a powerful force for change Creative destruction: the process of transformation that

accompanies radical innovation Sustainability-driven innovation: incorporates the added

variables of environmental and social impactso Social and environmental entrepreneurs will play an

important role To achieve sustainability is the profound challenge for the future

governments, financial institutions and businesses