Change and Personnel in the Organisation. Ways to Minimise Resistance

MTP Assignment by Alexander Komar, ID L0173SYSY0610, MFP, Group C

 

Change and Personnel in the Organisation.

Ways to Minimise Resistance.

 

 

 

2010

Modern era of globalisation has a significant impact on the way businesses are run today. Rapid development of transportation and communication technologies virtually eliminated geographical bounds, and not only did this expand markets, but also brought in new competitors with their often advantageous products and services. In their attempts to succeed in these open markets, companies face a lot of challenges, and they have to be in a constant process of transformation and adaptation to be able to cope with them. (Drucker, 2002) But changes lead to another problem – employees’ resistance.  The purpose of this work is to explore obvious and underline motives of resistance to change within the corporate structure and by individual employees, and also to analyse various approaches to this resistance reduction.

When we talk about change, we mean modifying something, varying it in some way. During their life organisations have to change strategies and objectives, their structure or culture. Often companies decide to modify products or services and processes employed. The latter often leads to, or influenced by, adjustment of technologies applied by the company. (Cole, 2000) The process of change also varies and depends on the particular organisation. Some businesses are very adaptable to any transformations. Others are less flexible. In these cases a process of change takes long time and is usually associated with various difficulties.

Ways of companies’ approach towards change are also different. There are organisations which employ changes reactively. This means that they are persuaded to adapt due to some external factors. Other organisations are proactively exploring every opportunity for transformation. The main role in such modifications belongs to internal factors.

So what are the factors that lead to organisational change? There are a few external causes for changes. Demand for new products or services, often caused by competitors or government policies, may lead businesses to adapting to these new customer preferences. This is one of the factors, which made biggest telecommunication enterprises of the USA, such as AT&T, turn towards developing the fourth generation networks. (web1) Another external reason for change can be caused by aggressive competitors’ campaigns or by an arrival of a new player on the market.

A factor which can have a really strong effect is a merger or an acquisition of a business, because it very often leads to cuts of employee numbers. (Kennedy, 2007)  A takeover of Abbey National bank by its Spanish counterpart Banco Santander caused reduction of Abby’s workforce by almost 30% from 23 000 to 16 000 personnel. (Web 2)

Other external factors include a failure of a main supplier to follow the company’s requirements, need to adapt to new situation in terms of trade, such as change in currency rates, tariffs and other financial elements). A lack of necessary number of qualified personnel, or appearance of new technology can also lead to change. And example of the latter is Apple iPhone (web3), which made a multi touch screen de facto an industry standard. Last but not least external change factor is a political factor. Taxation, laws and regulations play an important role in the business world and sometimes may lead companies to leave the entire market (Cole, 2000), as it nearly happened to Google in China in 2010 (Web 4).

Internal factors to change appear, as it was mentioned above, when the company proactively analyses its needs. It can be a transformation due to efforts towards cultural changes, revised objectives and strategy. Necessity to improve efficiency or quality of products. Need to be ready to respond to a possible appearance of a new technology, product or service, need to change regulations of dealing with suppliers as well as need to relocate personnel where it would be more efficient can become a challenge for a business (Cole, 2000).

Often companies decide outsource change implementation to a change agent, whose job is to do that in the most efficient way as well as to increase people’s ability to manage this change in the future (Kotter, 1996).

Approaches to change vary as well. Rosabeth Moss Kanter in her book ‘The Change Masters – Corporate Entrepreneurs at Work’ (cited by Cole, 2000) gives two approaches of companies towards transformation: integrative and segmentalist. In the first approach companies see change as an opportunity and are using new ideas with willingness. The segmentalist approach is focused on problem-solving. Organisation in this case is not a generic whole, but a set of segments, each of which has to deal with the change, if needed, within itself.

According to Kurt Lewin’s ‘force-field’ theory, every human grouping has some forces, directed towards changes and innovations, and at the same time those which keep this grouping together, providing stability and opposing those forces for transformation. Entire the organisation in this case is based on equilibrium between these forces, hence stronger pressure one applies in favour of change, more resistance they get. The author advices to be focusing on weakening those resisting forces, if one wishes to succeed in change implementation. (Burnes,2005)

A three stage approach tells that change can be implemented through three steps: unfreezing, changing and refreezing. The fist stage needs to demonstrate, that change is not only unavoidable but also desirable. The second step helps people to change their values, actions and attitude. The third step, refreezing, consolidates and reinforces changes through various supportive actions: encouragement, promotion, more consultation. (Cole, 2000)

Approach called ‘Action Research’ actively involves employees and is problem, not solution, oriented. It diagnoses the problem, collects data about it and analyses this information. Employees’ feedback is given on a regular basis and solutions are tested and implemented. At the last step evaluations and learning are taking place. (Burnes, 2005)

Organisational change can be a challenge and threat to managers and non managerial personnel; hence therefore it will inevitably lead to some degree of resistance among the company’s employees. Rosabeth Moss Kanter (1984) calls it ‘roadblocks of innovation’. (cited by Cole, 2000)

Reasons for resistance vary. Mitchell Lee Marks (2003) suggests that its roots are in people’s mental models, which prevent them from accepting the change as well as realising potential benefits to the organisation and themselves. He says that it is difficult to change old habits, especially if they previously worked well. Some organisations may still employ people who created older practices, and these people, if felt criticised, may do their best in attempts to defend status quo, spending a lot of energy on that, rather than on contributing to implementing the new order.

If a company introduces a new process and the employee have to learn them, some members of staff may feel uncertain, whether they can meet new demands. This can lead to developing of negative attitude, resisting new methods. (Robbins and Cenzo, 2008)

One more reason, why resistance occurs, is a fear of personal loss. Level of resistance in this case will be directly proportionate to individuals’ investment in the current system. They may be concerned about loss of position or money, friendship or authority, or any other perks, values, benefits. Since more senior employees invested more in the old order, they are going to be more resistant. (Robbins and Cenzo, 2008).

Lee Mark argues that real reasons for employees fighting for keeping status quo have not been researched in an appropriate level. In his book ‘Changing Back Up The Hill’ (2003) he analyses changes happening due to companies being merged or acquired. He states that such feeling as anger, sadness, grief, loss, fear, anxiety, and disenchantment are very likely to develop among the employees and they have to be dealt with regardless because they are the cause of resistance. Lee Mark’s framework of employee adaptation uses the three step approach to illustrate how employees can overcome these feelings.

Lee Mark (2003) demonstrates how employees have to pass three steps from current reality, when they experience anger, stress and fear after realising that change is going to take place; through the neutral zone, where they experience powerful emotions, chaos and apathy; to new reality, which is described as the beginning of a new step for employees. Those, who reached this last step, feel engaged and grounded, excited about new situation. However, not everybody are able to do that, and among those people who stuck in the neutral zone resistance grows.

Robbins and Cenzo (2008) illustrate six approaches to reducing resistance to change. And the first one is communicative. They recommend using this approach, when resistance occurs due to wrong information. Other authors (Lee Marks, 2003, Hammer and Champy, 2001) argue that communication and education are the most important techniques and should be applied at all times when change is implemented in order to reduce resistance.  Advantage of this is approach is in clarifying change objectives and possible misinterpretation of information. Yet, this communicative approach may be not very successful, if those implementing change do not have enough support and credibility.

The second technique, Robbins and Cenzo (2008) talk about is participation. Employing this method can be beneficial, when there are expert in the resisting group, who can contribute not only towards the best solution, but also towards overall decrease of resistance. However, this approach has its cons as well. Participation can require more time. Outcome can also be less beneficial, than it is expected.

Facilitation and support – these techniques are included in the communicational approach by Lee Mark (2003). He recommends the communicational approach to be applied every time change is implemented. Yet, as a separate method of reducing resistance to change it can be used, when sense of fear, grief and anger is very strong among the resisting employees. Advantage of this approach is in possibility to ease negative perception of change through providing resisting staff with compensational. It can be increased pay for additional duties, which can be added to existing job roles due to eliminating other roles during organisational change. Yet, this solution can appear too costly and still with no success guarantee (Robbins and Cenzo, 2008).

When resisting group has a high level of power, a negotiation approach can be applied. Trade unions are such powerful groups, and they can be very influential in western countries. During negotiation a company can ‘purchase’ co-operation. This solution can be very expensive. For example, British Airways ‘bought’ the union’s commitment, having to increase standard pay by two percent as well as to pay at least five hundred pounds to each employee represented by the Unite trade union (Web5). This kind of tactics can also stimulate other groups to join those more powerful ones in their demand for the additional gain (Robbins and Cenzo, 2008).

Manipulation and coercion are demonstrated by Robbins and Cenzo (2008) as separate techniques. However, they can be employed under similar circumstances – when a company, implementing the change, is in need of support by and endorsement of powerful groups. Both of these techniques can gain support relatively easily and are not costly. Yet both of them have a potential of a change agent to lose his or her credibility. The latter one can also be illegal.

These approaches, however, are unlikely to result in an elimination of resistance to change, when used separately. Most authors recommend using a combined approach. John Kotter (1996) in his approach to change stresses that resistance can be minimised with active engagement of all the employees in the process of change, empowering them and keeping them informed of reasons of change as well as of every step implemented. However, Peter Senge (2003) argues that empowering people without genuine believe in common goal would just create even more stress in the organisation. Kotter states that in order to avoid or minimise resistance it is even more important for executives and managers to be fully convinced with and trust the necessity of innovation, because it is their behaviour that creates the entire atmosphere of successful change.

Hammer and Champy (2001) also insist on a complex approach to getting people accept that radical change is inevitable, based on communicative and educative techniques. They stress importance of clear formulating of transformation as well as impossibility of staying at the current position. Information has to be communicated as a number of powerful arguments to convince members of staff to co-operate and contribute.

Hammer and Champy recommend applying their method in two major steps. The first one is meant to eliminate all possibilities for employees to doubt about the change importance. This is where the current situation of the company is clearly explained, and the reasons for transformation and impossibility to stay at the same position are emphasised. It is absolutely crucial for elimination of resistance that members of personnel are absolutely convinced about necessity of change. If they have any doubts about it, it is very likely that this change will not be fully tolerated and will also experience further obstructions.

At the second stage employees must be presented a measurable and achievable target, to which they should aim. This target is expressed in two documents, which are called case for action and vision statement.

Case for action must be short, logical persuasive. It has to contain a strong compelling argument with supporting evidence, and at the same time should not mention any cost of talking actions.  However, it is important to avoid exaggeration as well (Hammer & Champy, 2001).

The second document – vision statement – explains the new way the company going to operate as well as results, which are going to be achieved. This document contains qualitative and quantitative statements, and can be reused as many times as possible before change takes place to remind about objectives of transformation. Vision statement can be short, but it must be powerful. The authors describe this document as consisting of three major elements, which are focus on operational processes, measurable goals and indications of basic competitive advantages the organisation is going to obtain due to this change.

These messages have to be represented only by senior executives with high credibility, because for the personnel it is not easy to accept them. Hammer and Champy also stress that high level of diplomacy should also be employed.

Change is an inevitable phenomenon in the modern business world and everybody (Drucker, 2002) accepted that there is no reason to try to avoid it. However, different organisations approach change either in a proactive or in a passive way, hence this is influenced either by external or internal factors. According to Kurt Lewin’s theory, any forces would initiate resistance in order to remain in status quo. That happens with change as well, therefore, according to Lewin, not is it necessary to increase pressure, but to decrease resistance in order to move the line of equilibrium. In order to do that reasons for this resistance should be analysed first.

The main reasons for not accepting the change are uncertainty, concern over personal loss and belief that the change is not going to be beneficial for the company (Robbins & Cenzo, 2008). Solutions have to be carefully chosen for each particular situation. As it was described above, the main methods of dealing with employee resistance to change are communicative, participation, support, negotiation, manipulation and coercion. Some of them are applied more often, than others. Lee Marks (2003) as well as Hammer and Champy (2001) insist that the best way is to use a complex approach, which consists of some of these methods, and I would strongly agree with them, since stronger points of one technique will minimise disadvantages of the others. However, since change and resistance to it are very sensitive aspects, with any method employed, approach should be very careful and diplomatic.

(2594 words)

References.

Burnes, B. (2005) Managing Change. 4^th ed. Harlow: Prentice Hall. pp 260-285

Cole, G. (2000) Management. Theory and Practice. 5^th ed. London: Letts Educational. pp 192-207

Drucker, P. (2002) Management Challenges for the 21^st Century. Oxford: Elsevier. pp 25-35

Hammer, M. & Champy, J. (2001) Reengineering the Corporation. A Manifesto for Business   Revolution. London: Nicholas Brealey. pp. 34-53

Kennedy, C. (2007) Guide to the Management Gurus. 5^th ed. London: Random House Business Books.

Kotter, J. (1996) Leading change. Boston: Harvard Business School Press. pp. 33-159

Lee Marks, M. (2003) Changing Back Up the Hill. Hoboken, New Jersey: Jossey Bass. pp 131-261

Robbins, S. & Cenzo, D. (2008) Fundamentals of Management.6^th ed. Essential Concepts and Applications. Harlo: Pearson Education. pp. 230- 257

Senge, P. (2003) The Fifth Discipline. London: Nicholas Brealey Publishing. pp. 65-69

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