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Topic 1: Identify change requirements/opportunities © State of New South Wales, Department of Education and Training, 2008 Version 1 Contents Introduction 1 Identify areas for change 4 Monitor trends in the external environment 7 Identify major operational change requirements 9 Consult specialists and experts 13 Review and prioritise change requirements 15 References/More resources 17

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Topic 1: Identify change requirements/opportunities

© State of New South Wales, Department of Education and Training, 2008 Version 1

Contents

Introduction 1

Identify areas for change 4

Monitor trends in the external environment 7

Identify major operational change requirements 9

Consult specialists and experts 13

Review and prioritise change requirements 15

References/More resources 17

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Introduction

The opposing forces of change

Organisational change can be gladly accepted by members, totally opposed or

anything in between…

In its extreme, imagine a fierce tug of war about to be contested in front of you. The

damp grass is slippery; people are ‘digging in’ so they can haul the other team across

the line. As you circle the contestants you can see their names printed on the back of

their tee shirts: on one side you can see Emotional Blocks, Cultural Blocks, Cognitive

Blocks, Perceptual Blocks and finally Environmental Blocks (all from the one family,

‘The Blocks’) and on the other side (again from the one family) there are the Social

Forces, Economic Forces, Technological Forces, Market Forces and finally

Political/Legal Forces. The contest starts. It’s a hot day and the perspiration starts to

trickle down their contorted faces, falling from their chins onto the ground. Many are

getting short of breath but hanging in there. Some planning and training has preceded

this battle. Not everyone is involved at the same level; some have a lot to lose while

others are almost unaffected. Look around you while the tug of war is proceeding. Most

of the other people at this event are spectators who may have a preference, either way

they are entertained and some cheering out loud or perhaps silently for ‘their team’.

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Successful change is not common. The Centre of Corporate Change at the University

of NSW found that over 70% of long-term change efforts in Australia fail. The waste of

resources is horrifying; particularly when one thinks that they could be put into making

business more efficient, translating to lower prices for us, more jobs, higher pay and/or

greater leisure time. Their figures relate to significant attempted changes in commercial

organisations where significant resources have been applied to make the change

successful. One reason for the high failure rate is that organisations are not simple and

people have varying perspectives about what the organisation is to them. Essentially

we think ‘in our own world’, with little understanding of how others view it. One thing is

for sure though: a change will not be successful unless you get the support of others

who are affected by it.

Bolman and Deal (1997:26) depict organisational complexity in relation to change:

At home you flip the switch and the light goes on. In organisations, you flip the switch and nothing happens, or nothing happens until long after you leave the room. Maybe the switch eventually causes a toilet to flush in a building 10 miles away, but you are still in the dark, and so is the surprised user of the toilet. Neither of you realise the causality of the events and the event chain comes back to haunt you. You will not understand what’s going on — and you won’t know what to do about it — until you learn to see the system.

On page 27 they quote Oshry (1995) in describing organisational life:

When we are at the top of the organisation we lose track of what it is like to be in the middle or at the bottom. We do not see that system dynamics are producing a ‘dance of blind reflex’. In this ‘dance’, for example, top managers feel overwhelmed by complexity, responsibility and overload. They are chronically disappointed in middle management’s lack of initiative and creativity. Middle managers, meanwhile, feel torn up by conflicting signals and pressures. Top managers tell them to take risks then punish them for making mistakes. Their subordinates and bosses tug them in opposite directions, and they feel confused and weak. Workers feel vulnerable, unappreciated and opposed: ‘They give us lousy jobs with lousy pay, they order us around all the time but never tell us what’s really going on, and then they wonder why we don’t love our work’. If you do not see the dance, says Oshry, you continue to play your part blindly, unaware of any other option.

About this topic

This topic introduces sources and processes for identifying areas for change, or

change needs. Usually organisational change needs are primarily driven by external

sources, for example, customer demand for non face-to-face delivery, funding

changes, Training Package changes, strategic alliances etc) although in organisations

such as TAFE NSW change forces appear to arise from within the organisation, for

example marketing policy, processes, systems etc. This topic will help you to set the

scene for change; providing a rational basis as to why the people in an organisation

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should change. It also encourages you to be proactive (rather than reactive) to change

needs.

Activity

Research

Develop a story of 150-250 words about a change (or attempted change) in an organisation. It can be within or external to your organisation. You can change the names to protect people’s privacy (including yourself) and we’ll agree that the stories can (but not necessarily) be fictional and ‘bear no resemblance to persons, living or dead’. This ‘story’ will provide a valuable starting point for discussion as to how the theory of managing change relates to your personal experience. A suggested structure for the story is to briefly describe: 1. The need, 2. The solution, 3. The change program/implementation process, 4. The outcomes (for individuals and the organisation).

We’ll refer to your and your colleague’s stories throughout this unit and you can add to/modify your story over time as you develop your understanding of organisational change. You can also use a case study provided in this resource (under the ‘Case study’ section) as an example of a change project.

Group discussion

Discuss the following points with other learners or colleagues in relation to your stories.

1. What was the reason for the change? Was it clear?

2. What were the objective(s) of the change? (Were any objectives set?)

3. What was the process of implementing the change, including techniques for responding to resistance to change? Was resistance acknowledged or ignored?

4. How was the change process managed, if at all?

Portfolio

Document a case study which illustrates each of the key aspects of a change project as listed in the above questions.

WebsitesChange Management Learning CentreFamiliarise with trends and issues in change management at this site which includes tutorials and articles online. Full print publications need to be purchased.

Leading and Managing ChangeThis site provides some basic information on the principles for managing and leading change. There is written text, hyperlinks to articles and other websites. MERLOT

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Identify areas for change

This sub-topic will assist you to determine the alignment of your particular work section

with the overall strategic direction of the organisation.

The strategic direction

Organisations should have a strategic plan that provides the overall direction of the

organisation. One of the defining and critical features of an organisation is that the

efforts of all its sections, teams and individuals align towards the overall goals. This

gives it its strength. Plans should contain goals or objectives that should be achieved

within a defined period of time. For example an educational institution may have a plan

to start delivering specific courses in an overseas country within a two-year period.

Normally these plans are documented after a lengthy internal process which involves a

close look at trends in the environment in which the business operates and how the

strengths of the organisation may be used to exploit these trends.

Strategic plans are not necessarily documented for a range of reasons. If an

organisation is small the plans may only exist in the mind of the owner. There are many

reasons to not plan. These include a bad experience where plans could not be followed

because of circumstance that the organisation found itself in, so plans are not

attempted again. The environment in which an organisation operates may be rapidly

changing (eg during the global financial crisis) so planning is conceptually difficult and

fraught with unknowns. For some organisations strategic plans may not exist anywhere

(even in the mind of the owner) and the organisation is just drifting along as it always

has. You don’t have to be an Einstein to work out that an organisation that does not

plan could end up in trouble!

The strategic plan should be used to develop plans throughout the levels of an

organisation and these should support the achievement of goals in the strategic plan.

Each department should have a plan and each section within the department, right

down to plans for individuals. All these plans, and the goals within them, are aligned.

That’s the theory.

Organisations may have plans but they often do not make them available to employees

and shareholders because this would put them too much in the ‘public domain’ and

competitors, once alerted, could prevent the plan from being successfully implemented.

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Through the opening up (deregulation) of education to the private sector TAFE now

finds itself in a competitive environment, requiring change to past practices. For

example, suppose that the members of your teaching section are not confident they

can identify the current needs of local industry. It would be worthwhile changing the

systems in the section to find out the needs, for example allocate a part of the year (not

at a peak time, maybe in weeks 7 to 9 of semester two) to communicate with local

industry, through perhaps a local Chamber of Business meeting.

Activity

Workplace

If you don’t have a copy of the Business Line plan that relates to your work area or section, contact the Business Line Manager and ask for a copy.

What are the main points (objectives and milestones) within the plan?

If you think that your section is not currently aligned with the plan identify the gap/s. This could become a basis of a change project, ie select one area in the section that is not aligned with one goal of the plan. (Later on you’ll be shown how to write a SMART goal for this potential change project.)

Note that there is a hierarchy of plans: the Business Line plan should support the achievement of the Institute strategic plan/directions, which supports the TAFE NSW strategic plan/directions and that supports the achievement of the DET corporate plan. (This chain extends further to State Government and then Federal Government plans.)

Instead of the Business Line plan informing a section it could be that the reverse takes place; the section identifies a deficiency in the plan (perhaps due to a change in the operating environment) and requests a change to the Business Line plan to cater for the emerging need.

Case study

For your identified case study of a change project (or a case study provided to you) was there any reference to the alignment of the change project to the organisation’s plan?

Portfolio

Gather the key organisational planning documents which your section/team aligns to. Note the organisational goals and the corresponding activities that address each goal, as well as gaps where improvements and/or initiatives need to be developed.

List ideas for emerging needs and possible projects requiring change management processes to be implemented. Include your comments about any feedback from your team, manager and other colleagues on ideas for projects.

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Websites

Council of Australian Governments (COAG)The COAG website provides current information on national policy reforms impacting priorities for all Australian Governments.

Hierarchy of Tasmanian emergency management plansThis PDF gives an example of a hierarchy of plans for the Tasmanian SES.

NSW DET – Strategic Directions (DET portal login required.)Source the current strategic plans for NSW DET and TAFE NSW at this site for NSW Department of Education & Training, TAFE Policy, Strategy & Review Directorate Telephone (02) 9244-5011 Fax (02) 9244-5182.

NSW DET School Planning PolicyA slide show overview of planning for NSW state schools, provided by the Office of Schools for the Priority Schools Programs.

NSW Government State PlanReleased in 2006 this plan sets out priorities for Government action over the next 10 years.

Organisational planning and performance integration in a TAFE context Denise Bell (2008) This paper draws on a research project which developed a change management strategy to assist two TAFE institutes in addressing and improving their planning culture.

Skilling Australia for the futureFor the big picture; this policy document was released by the new federal government in 2007.

Wikipedia – Strategic planningA concise explanation of organisational strategic planning processes and elements.

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Monitor trends in the external environment

This sub-topic will help you to determine the sensitivity of your particular section to the

needs of the market and forces in the environment in which the organisation operates.

Typically, if the target market is requiring a certain course to be run then the

organisation should respond accordingly.

It was mentioned in the previous sub-topic that organisations, in making their strategic

plans, take into account what is happening in the environment in which they operate.

This will be done for the organisation as a whole so it may not take into account some

of the trends in the operating environment of particular sections of the organisation.

The organisation relies on you to feed back the results of this process known as

environmental scanning or ‘market intelligence’.

This will require you to be aware of everyday affairs via the media and discussions both

inside and outside work. Being alert to factors in (what is called) the external

environment of the organisation will help us do business better. The external

environment is not just the natural environment but also includes competitors,

demographic changes and technological changes that have an impact on our

customers, hence on what we offer to our target markets. If we are aware of changes

we can anticipate changes in the needs of our customers before they tell us; we can be

proactive and even ahead of our competitors.

The external environment refers to factors that have the potential to change (heighten

or reduce) the needs of our target market, some of which are:

consumer driven, eg a greater awareness of the green house effect; skills shortages

ecological, eg a need to preserve a natural environment

economic, eg global financial crisis; utilisation of cheaper offshore labour and other incentives (globalisation)

ethical, eg a greater accountability of company directors

legal, eg changes to regulations for hotels

political, eg a change in government

social, eg binge drinking

technological, eg increasing mobile devices for communication and work; digitisation of services and products.

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Activity

WorkplaceSelect at least two factors in the above list and identify a trend that has the potential to change what you are offering to your target market (you are not constrained by the above points).

Case studyDiscuss your case studies of change projects with colleagues. What external forces were driving the changes?

Portfolio

Review and add to your list of possible change projects. Identify specific external forces which you need to research further.

Websites

Insights From Strategic and Change Management Projects in Registered Training Organisations This publication provides a snapshot of a sample of eleven of the thirty Reframing the Future strategic and change management projects undertaken in 2007.

Research Reports – John Mitchell and AssociatesReports on VET practice in the context of global change and competition, including opportunities for innovation and organisational strategies for RTOs to develop in line with global trends.

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Identify major operational change requirements

In the previous sub-topic we identified changes, external to the organisation, in the

many areas of the environment in which an organisation operates. These forces, even

for many large organisations are out of their control. Another major category of forces

that impact the need for change in an organisation comes from within. This is

particularly applicable to a very large organisation such as TAFE NSW which is so

large that often people’s jobs become totally divorced from outside forces and

employees’ jobs are driven from within.

On 27 November 2007 TAFE NSW released ‘TAFE NSW: Doing Business in the 21st

Century-Proposals for consultation’. The document presented a new vision for TAFE

NSW and emphasised five reform commitments to offer greater service diversity and

flexibility for learners, employers and customers and to ensure TAFE services better

meet the needs of industry and the community. These were:

strengthening locally customised services

building a new relationship with industry and enterprises

implementing personalised services

investing in TAFE NSW staff

investing in TAFE technologies.

Current information about TAFE business reforms and the original source for the above

‘TAFE NSW: Doing Business in the 21st Century’ can be sourced at NSW DET–

Strategic Directions – TAFE NSW.

You may be able to identify areas where your team may be able to contribute to one or

more of the above five objectives and this may be a change in the status quo. Of

course, if every section chooses a different focus for its efforts the energy of

contributors may be distributed over too many priorities and none are achieved in the

end. That is why sections must take their lead from their managers, and these are

guided by managers above them and so on. Managers may decide to make an attack

on one of the above five areas first, since they may believe that that area is critical to

success at this time.

Apart from major business reform proposals a change requirement may also be

identified as a result of a difference between the actual performance of the organisation

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and the expected performance. For example, you may be aware that TAFE has new

funding agreements where each Institute of TAFE must agree to $/ASH* targets for

three years and there are penalties if targets are not met. If an Institute can lift student

numbers the ASH targets are easier to meet, so a change project could be to lift

enrolments in each section to enable $/ASH targets to be met.

* ASH = annual student hours. $/ASH is the cost of delivering one student hour of tuition. The term ASH

has replaced the acronym ASCH (actual student contact hours). This change has (presumably) arisen

from the introduction of flexible delivery, where students and teachers do not have to be in face to face

contact in a class room for delivery to be taking place.

A business opportunity may arise from a number of sources and there are some ‘idea

stimulators’ listed below.

Idea stimulators for identifying change requirements/opportunities

Opportunities Threats

Market developments Political effects

Competitors' vulnerabilities Legislative effects

Industry or lifestyle trends Environmental effects

Technology development and innovation IT developments

Global influences Competitor intentions — various

New markets, vertical, horizontal Market demand

Niche target markets New technologies, services, ideas

Geographical, export, import Vital contracts and partners

Tactics: eg surprise, major contracts Sustaining internal capabilities

Business and product development Obstacles faced

Information and research Insurmountable weaknesses

Partnerships, agencies, distribution Loss of key staff

Volumes, production, economies Sustainable financial backing

Seasonal, weather, fashion influences Economy — home, abroad

Here’s an example of how the above points may help you to identify change

requirements. If you consider the threat ‘obstacles faced’ you may think why you may

not be able to lift your enrolments to the level of a local private college competitor. The

obstacle in this case is the fact that customers tend to prefer to enrol with that

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competitor rather than with you. That might stimulate you to investigate why customers

have a preference for the competitor, and you might consider offering a similar (or

slightly improved) package which, of course, would have to be communicated to the

target market in a timely fashion.

The previous sub-topic (external business environment considerations) is one way of

identifying business opportunities. A second way is to complete a SWOT Analysis. You

need to identify the internal strengths and weaknesses of your section, as well as

opportunities and threats that are being presented outside.

S = Strengths of your business (internal eg particular skills the organisation may have)

W = Weaknesses (internal eg lack of particular skills)

O = Opportunities (external; may have been identified in the previous sub-topic)

T = Threats (external; may have been identified in the previous sub-topic)

The last internal source of change arises from management decisions. Often decisions

are made remote from sections that are affected and this breaks one of the most

important ‘rules’ in making successful change — to involve those affected by the

change in the process. For example a decision could be made remote from the section

to stop running a particular course, or to change the way it is delivered. One solution is

a concerted effort by decision makers to involve stakeholders in discussions and to try

to appease their needs. Of course this is much easier said than done as it would

require cultural/attitudinal changes and this probably cannot be achieved in less than

about five years. Following are two links to articles related to the strength of culture and

its inertia in an organisation.

Service Culture Change

It takes more time than you think; It also takes much longer than you think; It is never orderly and precise; It will involve every senior leader in ways that can be awkward.

Access this slide show at: Customer Focus Initiative

Source: Progressive Insights, Inc.

Corruption harms us all

This article (Sydney Morning Herald Editorial, Editorial,17/12/2008) describes how difficult organisational culture is to change. It reinforces that if there is a move to change any aspect of culture in an organisation, it will be slow and difficult. Access this article online.

Source: The Sydney Morning Herald

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Activity

Workplace

What are the major performance targets for your section and how are you performing against them? Examples of targets include budgets, ASH targets, Unit completion rates, qualification completions, job outcomes, levels of qualifications, core and non-core funding, industry involvement, community involvement, staff development, customer satisfaction surveys etc.

Analysis

What change scenarios arise from trying to meet these targets? For example, ASH targets may not be achieved, giving rise to a change in the way courses are promoted. If you are not used to having to promote courses this will require recognition of a change situation, requiring planning and overcoming resistance to the change.

Discussions

Discuss with your manager and team members the changes (in relation to performance targets) that need to be made in your section.

Case study

What cultural issues within the organisation are evident in the case study?

Portfolio

Record your research, analysis and discussion outcomes on changes for meeting performance targets.

Websites

Marketing TeacherThis site provides SWOT analysis examples for well known organisations.

MindTools – SWOT AnalysisSWAT analysis explained.

Upskilling NSWThe Independent Pricing and Regulatory Tribunal of NSW has reviewed the state’s skill base and identified the future challenges for our vocational education and training (VET) system over the next 20 years. IPART 2006.

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Consult specialists and experts

We’ve considered internal drivers (such as performance measurement and internal

management decisions) in terms of their ability to generate ideas for change. In this

sub-topic all other sources are tapped to obtain ideas for change.

There are people outside the immediate section who could help to identify change

priorities. For example the local Chamber of Commerce members may be able to let

you know their training and education needs. People have ‘networks’ in their

organisation and these include informal and formal connections with a range of

industries and organisations.

Peak bodies in the VET industry host workshops, conferences and showcases, and

these can be used to gather ideas and feedback. Stakeholders include local individuals

(eg school leavers), local community groups, industries and other RTOs. For example

one source of ideas is the annual TAFE Quality Awards. Often the projects are ‘ahead

of their time’ and it takes a long time for the information and ideas to disseminate

throughout the organisation, but if you actively seek out and implement new or

emerging practices the ‘time to market’ will be drastically reduced.

There are two important sources of change ideas that have not yet been discussed:

customers and employees in our own section. If an organisation is to prosper it should

be ‘market driven’ so ask customers for their ideas and let them give feedback

anonymously. Not every idea will be practical or financially viable but you may get

some realistic ones. One of the problems associated with seeking feedback from

customers is that it can be ‘hard to take’ (the truth often hurts) and it can also be

unjustified as they cannot see the whole picture. Nevertheless it may pay off in the long

run if you can accept customer feedback objectively. In addition to local information

gathering from direct customers you could conduct formal surveys; what are the

customers saying generally? For example, how do they like our enrolment process and

do they have ideas for improving it?

Employees have ideas but may rarely discuss them. They will have other life

experiences to base their ideas on and they are often quite realistic since they know a

lot about the organisation’s ‘system’. The key to tapping into this resource is to develop

trust between manager and subordinate and the ideas will flow more freely; if staff

know they can talk without fear everyone will benefit.

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Activity

List at least two ideas for change from any of the sources identified above. For example what does customer feedback reveal about changes you may have to make?

Portfolio

Gather or describe the feedback and consultation mechanisms you have used to generate ideas and feedback about change needs.

Record your analysis of all your thinking, discussion and research so far about change needs in terms of:

organisational and local business objectives (strategic planning)

external trends and influences impacting your business needs

specific operational changes, eg required by management decisions, and other views from your manager

consultation and feedback, eg through tapping into industry networks, specialists, customers and colleagues.

Websites

Australian Flexible Learning FrameworkUnder ‘Business activities’ and ‘Resources’ you can find examples of innovative projects in e-learning and case studies showing how projects address national and state VET priority areas.

Reframing the futureExamples of VET projects (up to 2008) which address training system reforms through professional development and change management practices.

TAFE NSW Quality AwardsDescriptions of past projects entered to the awards and information about entering is provided at this site. DET Portal log in is required.

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Review and prioritise change requirements

The previous sub-topics have given rise to a number of ideas for change designed to

improve the organisation. Now it is time to make a decision which is said to be ‘the

essence of a manager’s role’. Since the organisation will incur costs associated with

the implementation of the idea, the selection is crucial since a wrong selection will

mean not only the loss of direct costs of implementation but also the cost of the

additional revenue from the lost opportunity that could have been successful (known as

‘opportunity cost’.)

Presumably you have a number of practical ideas that could be implemented.

Unfortunately organisations do not have unlimited resources and time to pursue all of

the opportunities presented to them (in this case an opportunity = a change

opportunity) so managers need to prioritize the opportunities. Priorities are determined

by criteria. For example if a person needs a new car and is very safety conscious they

will have, as essential criteria when selecting the car, four (or more) air bags. Other

criteria may include the fuel economy if they do a lot of driving although this may be

secondary to their air bag criteria.

Of course you need to consider not just how the idea will help to achieve your team’s

goals but also the risk in each opportunity. If a change opportunity contributes a lot to

the section goals but it is highly risky then it may not be chosen over a moderate

contribution to goals if it is expected to have a low risk. For example, if two ideas have

been proposed to increase student numbers:

1. implement a new course that appears to meet a need of the target market arising from a trend in the external environment

2. do a mail out to graduates to offer an enrolment to a current course.

While both address a goal to increase ASH by 20% in the next calendar year, the first

is considered riskier because authority to run the course may not arrive in time, so the

second is selected on the basis of risk management.

Now it’s time to review the change opportunities you have identified so far and place

them in priority order in terms of:

1. their ability to achieve section goals

2. their level of risk (which could include the resistance to the change).

Tip: In prioritising change needs talk to not only your immediate manager but also the

person who does the business plan for your discipline, eg the Business Development

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Manager, to determine what areas are of most concern. Obtain permission from your

immediate manager to do this as they may take exception to your talking to their boss!

Also obtain a copy of the Business Plan for your section as a source of ideas. The plan

is a document that should coordinate the efforts of the many sections of the

organisation that impact one another, so efforts are not scattered over too many

change scenarios.

Note that the prioritising of change ideas is dealt with further in the next topic so it is

recommended that you prioritise ideas based on ‘gut feeling’ at this stage, although you

will undoubtedly have some idea of why you have placed the ideas in the order you did,

and the people you talk to will also (presumably) be able to give you reasons why

particular changes are important.

Remember to keep your analysis and decisions objective, as ultimately you may need

to justify to your team why some ideas are prioritised over others.

Activity

Portfolio

List in priority order at least three ideas for change. Write your justification for why they are placed in that order.

Website

Mind Tools – Decision Making TechniquesThere are a number of decision making techniques shown at this site.

Learning guide 1: Identify change requirements/opportunities Version 1 16© NSW DET 2008

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ReferencesBolman, L and Deal, T (1997) Reframing Organisations Jossey Bass San Francisco

Hubbard, G, Rice, J and Beamish, P (2008) Strategic Management Pearson Ed Aust

3rd Ed. ISBN 978 07339 8675 8

Oshry, B (1995) Seeing Systems: Unlocking the Mysteries of Organisational Life

Berrett-Koehler San Francisco

More resourcesInnovation & Business Skills Australia (IBSA)Order resources for learners and facilitators on topics related to VET organisational innovation, leadership and business skills at the IBSA website. Relevant resources include:

New Leadership for Innovative Organisations: Models, Ideas & Challenges

Ideas for practitioners: a professional development guide to growth and change in the VET sector

Innovation and Entrepreneurship in VET: a professional development guide for the Australian vocational education and training sector

Learning guide 1: Identify change requirements/opportunities Version 1 17© NSW DET 2008