Organizational Change

Why is change management a topic in organizational behavior? Organizations need to be able to adapt to different market conditions and customer needs and it seems as though those kinds of changes are happening every day. When an organization isn’t flexible, another business will swoop in and take those customers and those profits away. But change management is definitely a behavior. Organizations don’t have to change—people have to change. And that’s what change management is all about.

“Organizational change” pertains to the altering of structures, strategies, procedures or cultures of organizations (Quattrone and Hopper, 2001). The term encompasses both the process by which this happens (i.e., “how”) and the content of what is being altered (i.e., “what”). By definition, change implies a shift in the organization from one state to another. This shift may be deliberate, with the aim of gaining or losing specific features of the organization to attain a defined goal, or it may be less deliberate, perhaps occurring as a consequence of developments outside the control of the organization. Moreover, during the change process, additional parts of the organization may be unintentionally affected, particularly when change is experienced as excessive (Stensaker et al., 2001). Such unintended repercussions of organizational change may be both positive and negative (Jian, 2007), and may be more likely when a large number of transactions are required to implement the change decision and many specialized problem- solving capabilities are invoked (Casa and Lodge, 2015). Thus, organizational change can be experienced both as an opportunity to gain and as a risk of losing and may involve redesign of tasks and responsibilities that alter existing work content and –environment in various foreseen and unforeseen ways. Organizational change has repeatedly been associated with adverse effects on employee health (Oreg et al., 2011). Large-scale organizational changes, such as company restructuring, downsizing and outsourcing have been linked to mental health complaints and long-term sick leave (Kivimäki et al., 2001; Bamberger et al., 2012). Clarifying the repercussions of organizational change for workplaces and employees is an essential first step to preventing adverse health effects of and facilitating healthy, successful change. Prior meta-analytic studies have shown a wide range of psychological and social work factors, such as leadership, role conflict and ambiguity, job demands, control and job insecurity to predict employee well-being, health and sick leave (Viswesvaran et al., 1999; Stansfeld and Candy, 2006; Nahrgang et al., 2011; Lang et al., 2012; Schyns and Schilling, 2013; Virtanen et al., 2013; Schmidt  et  al.,  2014; Theorell et al., 2015), as well as the change process and end-result (Schuler and Jackson, 2001; Hoag et al., 2002).

Managers at an organization need to recognize problems as they occur and adjust their processes accordingly to solve for them. Good change management skills make this an easier process. Managers carrying out any of the P-O-L-C functions often find themselves faced with the need to manage organizational change effectively. Oftentimes, the planning process reveals the need for a new or improved strategy, which is then reflected in changes to tactical and operational plans. Creating a new organizational design (the organizing function) or altering the existing design entails changes that may affect from a single employee up to the entire organization, depending on the scope of the changes. Effective decision making, a Leadership task, takes into account the change-management implications of decisions, planning for the need to manage the implementation of decisions. Finally, any updates to controlling systems and processes will potentially involve changes to employees’ assigned tasks and performance assessments, which will require astute change management skills to implement. In short, change management is an important leadership skill that spans the entire range of P-O-L-C functions.

Most leaders are responsible for some degree of change management. In addition, as indicated in the introduction, organizational development (OD) is a specialized field that focuses on how to design and manage change. An OD consultant is someone who has expertise in change management processes. An internal consultant is someone who works as an employee of an organization and focuses on how to create change from within that organization. An external consultant is an OD specialist hired to provide outside expertise for a short period of time, usually for a major change effort. Leaders are more effective in managing change if they understand the common practices for managing change as well as the perspectives and practices used by OD specialists.

Change is the one of the most important and difficult problem with which organizations is dealing. The ability to change rapidly, efficiently, and almost continually is a major dilemma for organizations in today‟s rapidly changing environment.

License

Icon for the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License

Organizational Behavior by Icfai Business School is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License, except where otherwise noted.