In the spectrum of organizational change, which is the most radical type of change: automation, rationalization of procedures, business reengineering, or paradigm shifts?
The most general conception of change is simply difference or nonidentity. Change is so persistent in our lives that it almost defeats description and analysis. One can think of it in a very general way as alteration. But alteration in a thing raises subtle problems. One of the most perplexing is the problem of the consistency of change: how can one thing have incompatible properties and yet remain the same thing? Some have held that change is a consistent process, and rendered so by the existence of time. Others have held that the only way to make sense of change is as an inconsistency.
Seven phases of change:
Shock and Surprise - confrontation with unexpected situations. This can happen ‘by accident’ (e.g. losses in particular business units) or planned events (e.g. workshops for personal development and team performance improvement). These situations make people realize that their own patterns of doing things are not suitable for new conditions any more. Thus, their perceived own competence decreases.
Denial and Refusal - people activate values as support for their conviction that change is not necessary. Hence, they believe there is no need for change; their perceived competency increases again.
Rational Understanding - people realize the need for change. According to this insight, their perceived competence decreases again. People focus on finding short term solutions, thus they only cure symptoms. There is no willingness to change own patterns of behavior.
Emotional Acceptance - this phase, which is also called ‘crisis’ is the most important one. Only if management succeeds to create a willingness for changing values, beliefs, and behaviors, the organization will be able to exploit their real potentials. In the worst case, however, change processes will be stopped or slowed down here.
Exercising and Learning - the new acceptance of change creates a new willingness for learning. People start to try new behaviors and processes. They will experience success and failure during this phase. It is the change managers task to create some early wins (e.g. by starting with easier projects). This will lead to an increase in peoples perceived own competence.
Realization - people gather more information by learning and exercising. This knowledge has a feedback-effect. People understand which behavior is effective in which situation. This, in turn, opens up their minds for new experiences. These extended patterns of behavior increase organizational flexibility. Perceived competency has reached a higher level than prior to change.
Integration - people totally integrate their newly acquired patterns of thinking and acting. The new behaviors become routine.
Organization change is in regard to organizational-wide change, from smaller changes to big changes. Some called organizational change as organizational transformation, often this term designates a fundamental and radical reorientation in the way the organization operates. Organizational change occurs when a company makes a transition from its current state to some desired future state. Managing organizational change is the process of planning and implementing change in organizations in such a way as to minimize employee resistance and cost to the organization while simultaneously maximizing the effectiveness of the change effort. Organizational change initiatives often arise out of problems faced by a company. In some cases, however, companies change under the impetus of enlightened leaders who first recognize and then exploit new potentials dormant in the organization or its circumstances. Some observers, more soberly, label this a "performance gap" which able management is inspired to close. A manager trying to implement a change, no matter how small, should expect to encounter some resistance from within the organization. Resistance to change is normal; people cling to habits and to the status quo. To be sure, managerial actions can minimize or arouse resistance. People must be motivated to shake off old habits. This must take place in stages rather than abruptly so that "managed change" takes on the character of "natural change." In addition to normal inertia, organization change introduces anxieties about the future. If the future after the change comes to be perceived positively, resistance will be less. The world is rapidly changing into something too hard to easily predict, with a hundred opportunities and pitfalls passing by every moment. To add to this confusion, there are hundreds, if not thousands of techniques, solutions and methods that claim to help business improve productivity, quality and customer satisfaction. They are like new shoppers in a giant grocery store: They are hungry, but there are so many brands, sizes and varieties you don’t know what to buy.
Automation (Speeding up performance)
Automation plays an increasingly important role in the global economy and in daily experience. Engineers strive to combine automated devices with mathematical and organizational tools to create complex systems for a rapidly expanding range of applications and human activities. Automation is a step beyond mechanization. Whereas mechanization provided human operators with machinery to assist them with the muscular requirements of work, automation greatly reduces the need for human sensory and mental requirements as well. Processes and systems can also be automated. The most common forms of organizational change are automation and rationalization. These relatively slow-moving and slow-changing strategies present modest returns but little risk. Faster and more comprehensive change—such as reengineering and paradigm shifts—carries high rewards but offers substantial chances of failure. The most common form of IT-enabled organizational change is automation. The first applications of information technology involved assisting employees with performing their tasks more efficiently and effectively. Calculating paychecks and payroll registers, giving bank tellers instant access to customer deposit records, and developing a nationwide network of airline reservation terminals for airline reservation agents are all examples of early automation.
Rationalization (Streamlining of operating procedures)
A deeper form of organizational change—one that follows quickly from early automation—is rationalization of procedures. Automation frequently reveals new bottlenecks in production and makes the existing arrangement of procedures and structures painfully cumbersome. Rationalization of procedures is the streamlining of standard operating procedures. For example, the Victoria Country Fire Authority’s new emergency management system described in the chapter-opening case is effective not only because it uses computer technology but also because its design enables the organization to operate more efficiently. The procedures of the Victoria Country Fire Authority (CFA), or any organization, must be rationally structured to achieve this result. CFA had to have standard identification codes for emergency equipment, fire brigades, and localities and standard rules for routing brigades and equipment to the appropriate emergency location. Without a certain amount of rationalization in the CFA’s organization, its computer technology would have been useless.
Reengineering (Radical design of business processes)
A more powerful type of organizational change is business process reengineering, in which business processes are analyzed, simplified, and redesigned. Using information technology, organizations can rethink and streamline their business processes to improve speed, service, and quality. Business reengineering reorganizes work flows, combining steps to cut waste and eliminating repetitive, paper-intensive tasks (sometimes the new design eliminates jobs as well). It is much more ambitious than rationalization of procedures, requiring a new vision of how the process is to be organized. A widely cited example of business reengineering is Ford Motor Company’s invoiceless processing, which reduced headcount in Ford’s North American Accounts Payable organization of 500 people by 75 percent. Accounts payable clerks used to spend most of their time resolving discrepancies between purchase orders, receiving documents, and invoices. Ford reengineered its accounts payable process so that the purchasing department enters a purchase order into an online database that can be checked by the receiving department when the ordered items arrive. If the received goods match the purchase order, the system automatically generates a check for accounts payable to send to the vendor. There is no need for vendors to send invoices (Hammer and Champy, 1993). Rationalizing procedures and redesigning business processes are limited to specific parts of a business. New information systems can ultimately affect the design of the entire organization by transforming how the organization carries out its business or even the nature of the business. For instance, the long-haul trucking and transportation firm Schneider National used new information systems to change its business model. Schneider created a new business managing the logistics for other companies. Baxter International’s stockless inventory system transformed Baxter into a working partner with hospitals and into a manager of its customers’ supplies. This more radical form of business change is called a paradigm shift. A paradigm shift involves rethinking the nature of the business and the nature of the organization. Reengineering is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, speed, and service. BPR combines a strategy of promoting business innovation with a strategy of making major improvements to business processes so that a company can become a much stronger and more successful competitor in the marketplace. Re-engineering is the basis for many recent developments in management. The cross-functional team, for example, has become popular because of the desire to re-engineer separate functional tasks into complete cross-functional processes. Also, many recent management information systems developments aim to integrate a wide number of business functions. Enterprise resource planning, supply chain management, knowledge management systems, groupware and collaborative systems, Human Resource Management Systems and customer relationship management systems all owe a debt to re-engineering theory. Business process reengineering (BPR) began as a private sector technique to help organizations fundamentally rethink how they do their work in order to dramatically improve customer service, cut operational costs, and become world-class competitors. A key stimulus for reengineering has been the continuing development and deployment of sophisticated information systems and networks. Leading organizations are becoming bolder in using this technology to support innovative business processes, rather than refining current ways of doing work Business process reengineering is one approach for redesigning the way work is done to better support the organization's mission and reduce costs. Reengineering starts with a high-level assessment of the organization's mission, strategic goals, and customer needs.
Paradigm Shift (Radical reconceptualization)
Paradigm shifts and reengineering often fail because extensive organizational change is so difficult to orchestrate. Why, then, do so many corporations contemplate such radical change? Because the rewards are equally high. In many instances firms seeking paradigm shifts and pursuing reengineering strategies achieve stunning, order-of-magnitude increases in their returns on investment. Some of these success stories, and some failure stories, are included throughout this book.
Managing change effectively requires moving the organization from its current state to a future desired state at minimal cost to the organization. Key steps in that process are:
1. Understanding the current state of the organization. This involves identifying problems the company faces, assigning a level of importance to each one, and assessing the kinds of changes needed to solve the problems.
2. Competently envisioning and laying out the desired future state of the organization. This involves picturing the ideal situation for the company after the change is implemented, conveying this vision clearly to everyone involved in the change effort, and designing a means of transition to the new state. An important part of the transition should be maintaining some sort of stability; some things—such as the company's overall mission or key personnel—should remain constant in the midst of turmoil to help reduce people's anxiety.
3. Implementing the change in an orderly manner. This involves managing the transition effectively. It might be helpful to draw up a plan, allocate resources, and appoint a key person to take charge of the change process. The company's leaders should try to generate enthusiasm for the change by sharing their goals and vision and acting as role models. In some cases, it may be useful to try for small victories first in order to pave the way for later successes.
Change is natural, of course. Proactive management of change to optimize future adaptability is invariably a more creative way of dealing with the dynamisms of industrial transformation than letting them happen willy-nilly. That process will succeed better with the help of the the company's human resources than without.
Changes are inevitable. Changes can be fearsome, but you will have to deal with it sooner or later. But why wait sooner when you can deal it now. Go out with your comfort zones, explore new things before it will overrun you and caught you off guard.
“It's not that some people have willpower and some don't. It's that some people are ready to change and others are not.” James Gordon, M.D.
http://plato.stanford.edu/entries/change/
http://definitions.uslegal.com/m/managing-organizational-change/
http://www.themanager.org/strategy/change_phases.htm
http://www.organizedchange.com/decide.htm
http://managementhelp.org/mgmnt/orgchnge.htm
http://www.ebusinessclassonline.com/management%20information%20systems/ch14/chpt14-1fulltext.htm
_________________
-=♥yhang♥=-
The most general conception of change is simply difference or nonidentity. Change is so persistent in our lives that it almost defeats description and analysis. One can think of it in a very general way as alteration. But alteration in a thing raises subtle problems. One of the most perplexing is the problem of the consistency of change: how can one thing have incompatible properties and yet remain the same thing? Some have held that change is a consistent process, and rendered so by the existence of time. Others have held that the only way to make sense of change is as an inconsistency.
Seven phases of change:
Shock and Surprise - confrontation with unexpected situations. This can happen ‘by accident’ (e.g. losses in particular business units) or planned events (e.g. workshops for personal development and team performance improvement). These situations make people realize that their own patterns of doing things are not suitable for new conditions any more. Thus, their perceived own competence decreases.
Denial and Refusal - people activate values as support for their conviction that change is not necessary. Hence, they believe there is no need for change; their perceived competency increases again.
Rational Understanding - people realize the need for change. According to this insight, their perceived competence decreases again. People focus on finding short term solutions, thus they only cure symptoms. There is no willingness to change own patterns of behavior.
Emotional Acceptance - this phase, which is also called ‘crisis’ is the most important one. Only if management succeeds to create a willingness for changing values, beliefs, and behaviors, the organization will be able to exploit their real potentials. In the worst case, however, change processes will be stopped or slowed down here.
Exercising and Learning - the new acceptance of change creates a new willingness for learning. People start to try new behaviors and processes. They will experience success and failure during this phase. It is the change managers task to create some early wins (e.g. by starting with easier projects). This will lead to an increase in peoples perceived own competence.
Realization - people gather more information by learning and exercising. This knowledge has a feedback-effect. People understand which behavior is effective in which situation. This, in turn, opens up their minds for new experiences. These extended patterns of behavior increase organizational flexibility. Perceived competency has reached a higher level than prior to change.
Integration - people totally integrate their newly acquired patterns of thinking and acting. The new behaviors become routine.
Organization change is in regard to organizational-wide change, from smaller changes to big changes. Some called organizational change as organizational transformation, often this term designates a fundamental and radical reorientation in the way the organization operates. Organizational change occurs when a company makes a transition from its current state to some desired future state. Managing organizational change is the process of planning and implementing change in organizations in such a way as to minimize employee resistance and cost to the organization while simultaneously maximizing the effectiveness of the change effort. Organizational change initiatives often arise out of problems faced by a company. In some cases, however, companies change under the impetus of enlightened leaders who first recognize and then exploit new potentials dormant in the organization or its circumstances. Some observers, more soberly, label this a "performance gap" which able management is inspired to close. A manager trying to implement a change, no matter how small, should expect to encounter some resistance from within the organization. Resistance to change is normal; people cling to habits and to the status quo. To be sure, managerial actions can minimize or arouse resistance. People must be motivated to shake off old habits. This must take place in stages rather than abruptly so that "managed change" takes on the character of "natural change." In addition to normal inertia, organization change introduces anxieties about the future. If the future after the change comes to be perceived positively, resistance will be less. The world is rapidly changing into something too hard to easily predict, with a hundred opportunities and pitfalls passing by every moment. To add to this confusion, there are hundreds, if not thousands of techniques, solutions and methods that claim to help business improve productivity, quality and customer satisfaction. They are like new shoppers in a giant grocery store: They are hungry, but there are so many brands, sizes and varieties you don’t know what to buy.
Automation (Speeding up performance)
Automation plays an increasingly important role in the global economy and in daily experience. Engineers strive to combine automated devices with mathematical and organizational tools to create complex systems for a rapidly expanding range of applications and human activities. Automation is a step beyond mechanization. Whereas mechanization provided human operators with machinery to assist them with the muscular requirements of work, automation greatly reduces the need for human sensory and mental requirements as well. Processes and systems can also be automated. The most common forms of organizational change are automation and rationalization. These relatively slow-moving and slow-changing strategies present modest returns but little risk. Faster and more comprehensive change—such as reengineering and paradigm shifts—carries high rewards but offers substantial chances of failure. The most common form of IT-enabled organizational change is automation. The first applications of information technology involved assisting employees with performing their tasks more efficiently and effectively. Calculating paychecks and payroll registers, giving bank tellers instant access to customer deposit records, and developing a nationwide network of airline reservation terminals for airline reservation agents are all examples of early automation.
Rationalization (Streamlining of operating procedures)
A deeper form of organizational change—one that follows quickly from early automation—is rationalization of procedures. Automation frequently reveals new bottlenecks in production and makes the existing arrangement of procedures and structures painfully cumbersome. Rationalization of procedures is the streamlining of standard operating procedures. For example, the Victoria Country Fire Authority’s new emergency management system described in the chapter-opening case is effective not only because it uses computer technology but also because its design enables the organization to operate more efficiently. The procedures of the Victoria Country Fire Authority (CFA), or any organization, must be rationally structured to achieve this result. CFA had to have standard identification codes for emergency equipment, fire brigades, and localities and standard rules for routing brigades and equipment to the appropriate emergency location. Without a certain amount of rationalization in the CFA’s organization, its computer technology would have been useless.
Reengineering (Radical design of business processes)
A more powerful type of organizational change is business process reengineering, in which business processes are analyzed, simplified, and redesigned. Using information technology, organizations can rethink and streamline their business processes to improve speed, service, and quality. Business reengineering reorganizes work flows, combining steps to cut waste and eliminating repetitive, paper-intensive tasks (sometimes the new design eliminates jobs as well). It is much more ambitious than rationalization of procedures, requiring a new vision of how the process is to be organized. A widely cited example of business reengineering is Ford Motor Company’s invoiceless processing, which reduced headcount in Ford’s North American Accounts Payable organization of 500 people by 75 percent. Accounts payable clerks used to spend most of their time resolving discrepancies between purchase orders, receiving documents, and invoices. Ford reengineered its accounts payable process so that the purchasing department enters a purchase order into an online database that can be checked by the receiving department when the ordered items arrive. If the received goods match the purchase order, the system automatically generates a check for accounts payable to send to the vendor. There is no need for vendors to send invoices (Hammer and Champy, 1993). Rationalizing procedures and redesigning business processes are limited to specific parts of a business. New information systems can ultimately affect the design of the entire organization by transforming how the organization carries out its business or even the nature of the business. For instance, the long-haul trucking and transportation firm Schneider National used new information systems to change its business model. Schneider created a new business managing the logistics for other companies. Baxter International’s stockless inventory system transformed Baxter into a working partner with hospitals and into a manager of its customers’ supplies. This more radical form of business change is called a paradigm shift. A paradigm shift involves rethinking the nature of the business and the nature of the organization. Reengineering is a fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in cost, quality, speed, and service. BPR combines a strategy of promoting business innovation with a strategy of making major improvements to business processes so that a company can become a much stronger and more successful competitor in the marketplace. Re-engineering is the basis for many recent developments in management. The cross-functional team, for example, has become popular because of the desire to re-engineer separate functional tasks into complete cross-functional processes. Also, many recent management information systems developments aim to integrate a wide number of business functions. Enterprise resource planning, supply chain management, knowledge management systems, groupware and collaborative systems, Human Resource Management Systems and customer relationship management systems all owe a debt to re-engineering theory. Business process reengineering (BPR) began as a private sector technique to help organizations fundamentally rethink how they do their work in order to dramatically improve customer service, cut operational costs, and become world-class competitors. A key stimulus for reengineering has been the continuing development and deployment of sophisticated information systems and networks. Leading organizations are becoming bolder in using this technology to support innovative business processes, rather than refining current ways of doing work Business process reengineering is one approach for redesigning the way work is done to better support the organization's mission and reduce costs. Reengineering starts with a high-level assessment of the organization's mission, strategic goals, and customer needs.
Paradigm Shift (Radical reconceptualization)
Paradigm shifts and reengineering often fail because extensive organizational change is so difficult to orchestrate. Why, then, do so many corporations contemplate such radical change? Because the rewards are equally high. In many instances firms seeking paradigm shifts and pursuing reengineering strategies achieve stunning, order-of-magnitude increases in their returns on investment. Some of these success stories, and some failure stories, are included throughout this book.
Managing change effectively requires moving the organization from its current state to a future desired state at minimal cost to the organization. Key steps in that process are:
1. Understanding the current state of the organization. This involves identifying problems the company faces, assigning a level of importance to each one, and assessing the kinds of changes needed to solve the problems.
2. Competently envisioning and laying out the desired future state of the organization. This involves picturing the ideal situation for the company after the change is implemented, conveying this vision clearly to everyone involved in the change effort, and designing a means of transition to the new state. An important part of the transition should be maintaining some sort of stability; some things—such as the company's overall mission or key personnel—should remain constant in the midst of turmoil to help reduce people's anxiety.
3. Implementing the change in an orderly manner. This involves managing the transition effectively. It might be helpful to draw up a plan, allocate resources, and appoint a key person to take charge of the change process. The company's leaders should try to generate enthusiasm for the change by sharing their goals and vision and acting as role models. In some cases, it may be useful to try for small victories first in order to pave the way for later successes.
Change is natural, of course. Proactive management of change to optimize future adaptability is invariably a more creative way of dealing with the dynamisms of industrial transformation than letting them happen willy-nilly. That process will succeed better with the help of the the company's human resources than without.
Changes are inevitable. Changes can be fearsome, but you will have to deal with it sooner or later. But why wait sooner when you can deal it now. Go out with your comfort zones, explore new things before it will overrun you and caught you off guard.
“It's not that some people have willpower and some don't. It's that some people are ready to change and others are not.” James Gordon, M.D.
http://plato.stanford.edu/entries/change/
http://definitions.uslegal.com/m/managing-organizational-change/
http://www.themanager.org/strategy/change_phases.htm
http://www.organizedchange.com/decide.htm
http://managementhelp.org/mgmnt/orgchnge.htm
http://www.ebusinessclassonline.com/management%20information%20systems/ch14/chpt14-1fulltext.htm
_________________
-=♥yhang♥=-
