Managing change and innovation:

INNOVATION:
Innovation is the creation of better or more effective products, processes, services, technologies, or ideas that are accepted by markets, governments, and society. Innovation differs from invention in that innovation refers to the use of a new idea or method, whereas invention refers more directly to the creation of the idea or method itself. Example of innovative company: Nike Inc. Among the most innovative companies Nike falls at the sixth position Innovation is at the heart of NIKE, Inc.'s business growth strategy. It focus is to create the world's most innovative products for consumers across the globe. This same philosophy and determination is driving change in how it approaches corporate responsibility in today's marketplace. To be the leading athletic brand in the world - today and into the future it has to deliver innovative new products and experiences in a more sustainable way keeping in view not only the demands and choices of the customer but also the availability of resources.

CHANGE:
Any alterations in the people, structure, or technology of an organization. Managing change is an integral part of every managers job.
Characteristics of Change Is constant yet varies in degree and direction.

Produces uncertainty yet is not completely unpredictable. Creates both threats and opportunities.

Forces for Change:

Change is an organizational reality. It is an integral part of every managers Job. The forces which constrain and compel managers to introduce change are of two types.
1. External forces: the term external forces refer to those forces outside the organization that

affect organization and force it to bring change.

Marketplace: the constantly changing demand of customer force organization to adapt change according to the consumer desires. For example Google restlessly improves its search engine and adds new features to compete with Yahoo!, ask.com. Governmental laws & regulations: The political and legal dimensions of the external environment include regulatory parameters within which an organization must operate. Political parties create or influence laws, and business owners must abide by these laws.

Tax policies, trade regulations, and minimum wage legislation are just a few examples of political and legal issues that may affect the way an organization operates.

Technology: The technological dimension of the external environment impacts the scientific processes used in changing inputs (resources, labor, money) to outputs (goods and services). The success of many organizations depends on how well they identify and respond to external technological changes. Labor markets: Organizations that need certain kinds of employees must change their human resource management activities to attract and retain skilled employees in the areas of greatest need. For instance, health care organizations facing severe nursing shortages have had to change the way they schedule work hours. Economic changes: economic uncertainties like interest rate, federal budget deficits and currency exchange rates create conditions that force organizations to change.

INTERNAL FORCES:

These forces tend to originate from the internal operations of the organization or from the impact of external changes. Strategy: A redefinition or modification of an organizations strategy often introduces a host of changes. Strategy refers to a plan of action designed to achieve a particular goal. For instance: If a company changes its marketing policy from increasing its sales to grab their customer interest to better quality product. Workforce: An organizations workforce is rarely static. Its composition changes in terms of age, education, ethnic background etc. Compensation and benefits systems and employing new and experienced work force is the need of every organization to compete with the changing environment. Equipment: Employees may have their jobs redesigned, need to undergo training, or be required to establish new interaction patterns within their work group. Employee attitudes: Job dissatisfaction may lead to increased absenteeism, more voluntary resignation and even labor strikes. Such events often lead to changes in management policies.

TWO VIEWS OF THE CHANGE PROCESS:

There are two different metaphors to describe change process.
1. The Calm water Metaphor

2. White-water metaphor

The Calm water Metaphor:

Calm water metaphor envisions the organization as a large ship making a predictable trip across a calm sea and experiencing an occasional STORM. Kurt Lewin explains this change process in three steps: 1. Unfreezing the status quo:

2. Changing to a new state 3. Refreezing to make the change permanent. Successful change can be planned & requires unfreezing the status quo, changing to new state & refreezing to make the change permanent. Introducing change doesnt ensure that the change will take the hold. The new situation needs to be refrozen so that it can be sustained over time.

White-Water Rapids Metaphor:

White-water rapids metaphor describes the organization as a small raft navigating a raging river with uninterrupted white-water rapids. This metaphor takes into consideration the fact that environments are both uncertain and dynamic. The lack of environmental stability and predictability requires that managers and organizations continually adapt (manage change actively) to survive. We have to be flexible& able to respond quickly to changing conditions. Example: consider attending a college with courses and duration vary in length and all exams are unannounced. To succeed in this type of environment youd have to incredibly flexible and able to respond quickly to changing conditions. Conclusion of Two Metaphors: Today, every organization is facing change and no one can resist it. Is no longer business as-usual. Too much is changing too fast for any organization or its managers to be complacent. The concept of calm waters environment isnt what most managers face today.

What is organizational change:

Organizational change is any alteration of people, structure, or technology .Initiating change involves identifying the type of change needed and putting the change in process.

Change agent: Organizational change always involves need someone to act as a catalyst and assume the responsibility for managing the change process. Types of Change Agents Managers: Non-Managers: Outside Consultants: internal entrepreneurs change specialists change implementation experts.

Disadvantage of having an outside consultant as a change agent:

As they have limited understanding of the organizations history, culture, operating procedures and people, they are likely to initiate more drastic change than insiders would because they dont have to live with it after the change has implemented.