Unit Five

Organizational change and Development

5.1 Introducing Change Management

5.1.1 Definition.
Change in itself is the movement from the old way of doing things to a new way. Change
may entail installing new equipment, restructuring the organization, implementing a new
performance appraisal system anything that alters existing relationships or activities.
Although change is almost everywhere this particular unit will focus on the
organizational change.
Change is becoming a fact of life. In globalize era change (dynamism) is becoming a
natural. Obviously, organizational changes occur as a result of life cycle of the
organization. I.e. Organization could pass through different life cycle which demands
different managerial approaches, might demand structural and technological change or
else change occur unexpected due to both internal and external forces that causes change.
Management is charged with the responsibility for maintaining a dynamic equilibrium by
diagnosing situations and designing adjustments that are most appropriate for coping with
current conditions. A dynamic equilibrium for an organization would include the
following:
 Enough stability to facilitate achievement of current goals
 Enough continuity to ensure orderly change in either ends or means
 Enough adaptability to react appropriately to external opportunities and demands
as well as changing internal conditions
 Enough innovativeness to allow the organization to be proactive (initiate changes)
when conditions warrant.
5.1.2 Forces for Change
More and more organizations today face dynamic and changing environment. Especially
in globalize era things/ situations can’t stay longer as stable. The question is what forces
causes change in the organization?

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The need for organizational change becomes apparent when managers sense that an
organization’s activities, goals, or values are deficient in some way. The forces
necessitating organizational change can be found both inside and outside the
organizations. If managers are to take a comprehensive view of innovation and
adaptation, they must be aware of both types of forces and be able to account for both in
their actions. Thus, the forces for change in the organization could be classified in to:
A Internal Forces for Change
As the name implies these are forces with in the organization that will result in change.
These factors include:
 Changes in the composition or personal goals of employees- individual
preference and test change due to several reasons, which could be the
greatest cause for change.
 Change in the job technology (more computers and automation, TQM
programs)- due to the advancement of the technologies a lot of new ways,
means and methods , equipments , facilities, strategies and application of
various IT has drastically changed the way the job used to be done.
 Organizational structure change- due the reasons explained in the
previous unit organizational re-structure is evident in most organizations.
 Organizational climate change (change in organizational culture)
 Change in the organizational goals (when the priorities / emphases of
goals changes)
B External Forces For Change
These are forces out side the organization but results in organizational change. These
forces include:
 Changes in the economic or market conditions (security market changes,
interest rate fluctuations, foreign currency fluctuation, inflations, decline in
demand for a company product etc …)
 Change in product or manufacturing technology. Technology is changing jobs
and organization for instance, the substitution of computer control for direct
supervision will result in wider span of control for managers and flatter
organization.

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 Changes in the legal or political situation- For instance a new consumer
protection law that affects current products or practices. For instance, in Ethiopia
there is less organized effort to protect the consumers’ rights…
 Changes in the resource availability- such as an increase in cost or sudden
unavailability of a major input, such as oil.
 Competition for scare resource, expanded market share and influence in the
global market is becoming the major reasons for change in the current era.
5.1.3 Managing Planned Change
Depending on the nature of the organization and leadership to be reactive or proactive,
how change is introduced in the organization varies. Thus, a change could be externally
imposed or deliberately introduced for the good of an organization. What is management
of planned change and what is involved in the planned change, what strategies are
available to introduce planned change?
External forces may impose change on an organization. Ideally, however, the
organization will not only respond to change but will also anticipate it, prepare for it
through planning, and incorporate it in the organizations strategy. Thus, a planned change
is change activities that are intentional and goal oriented. The introduction of planned
change, first it seeks to improve the ability of the organization to adapt to changes in its
environments; second, it seeks to change employee behavior.

If an organization is to survive, it must respond to changes in its environment. When

competitors introduce new products or services, government agencies enact new laws,
important source of supply go out of business, or similar environmental changes take
place. Therefore, the organization needs to adapt. Efforts to stimulate innovation,
empower employees, and introduce work teams are examples of planned change
activities directed at responding to changes in the environment. Since an organization’s
success or failure is essentially due to the things that its employees do or fail to do,
planned change also is concerned with changing the behavior of individuals and groups
with in the organization.
It also helps to think of planned change in terms of order of magnitude. First order
change is linear and continuous. It implies no fundamental shifts in the assumptions that

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organizational members hold about the world and how the organization can improve its
functioning. In contrast, second order change is a multidimensional multilevel,
discontinuous radical change involving reframing of assumptions about the organization
and the world in which it operates.
Who in organizations are responsible for managing change activities? The answer is
change agents people who act as catalysts and assume the responsibility for managing
change activities. Change agents can be managers or non- manager employees of the
organization or outside consultants.
5.1.3.1 Models of Planned Change
Models are simplified versions of the realties. They represent the theoretical framework
in a reality in a systematic manner. Planned organization change requires a systematic
process of movement from one condition to another. Kurt lewin suggested that efforts to
bring about planned change in organizations should approach change as a multistage
process. (Griffin, 2007: 513 – 515). In light of the above leading statement, this
particular unit will present one widely known model of planned change as follows:
Lewin’s process model
Lewin’s model of planned change is made up of three steps unfreezing, change and
refreezing. Unfreezing is the process by which people become aware of the need for
change. If people are satisfied with current practices and procedures, they may have little
or no interests in making changes. The key factor in unfreezing is making employees
understand the importance of a change and how their jobs will be affected by it. Creating
in employees the awareness of the need for change is the responsibility of the leadership
in the organization.
Once the real desire for the change is created, the next move should be devising the
strategy to introduce the intended change. Depending on the nature of change among
other variables different techniques or procedures could be used to introduce the change.
Once the intended change is introduced the new behavior should be permanent. This
needs a lot of works. Refreezing makes new behaviors relatively permanent and reduce
resistant to further change. Examples of refreezing techniques include repeating newly
learned skills in a training session and role playing to teach how the new skill can be used

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in real life work situation. Refreezing is necessary because without it, the old ways of
doing things might soon reassert themselves while new ways are forgotten.
5.1.4 Resistance to Change
Change is inevitable; so is resistance to change. Paradoxically, organizations both
promote and resist change. Resistance may come from the organization or individuals or
both. The discussion of each will be presented as follows:
I. Organizational Sources Of Resistance
According to (Griffin, 2007) the following are identified as organizational source of
resistance:
 Over determination/ structural inertia- organizations have several ways
designed to maintain stability. In other words, the structure of the
organization produces resistance to change because it is the way designed
to maintain stability. People who have already assumed the boxes might
fight against not to lose the position.
 Narrow focus of change- this is when any effort to force change in the
tasks of individuals or groups failed to properly to take into account the
interdependencies among organizational elements such as people,
structure, tasks and the information system.
 Group inertia – when an employee attempts to change his or her work
behavior, the group may resist by refusing to change other behaviors that
are necessary to complement to the individuals changed behavior. In other
words, group norms may act as a brake on individual attempts at behavior
change.
 Threatened expertise – A change in the organization may threaten the
specialized expertise that individuals and groups have developed over the
years. This is where the change is resided by the organization expertise for
it might replace other in their place.
 Threatened power – any redistribution of decision making authority such
as with reengineering or team based management may threaten an
individuals power relationships with others.

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 Resource allocation – groups that are satisfied with current resource
allocation methods may resist any change they believe will threaten future
allocations.
II. Individuals Sources of Resistance
Individual sources of resistance to change are rooted in basic human characteristics such
as needs and perceptions. Some of the individual sources of resistance:
 Habit – People usually prefer to accept what they are accustomed with in
stead of learning an entirely new set of steps makes the job more difficult.
 Security – Some employees like the comfort and security of doing things
the same old way. People who believe their security is threatened by a
change are ready to resist change.
 Economic factors – the resistance become severe when employees feel
change will make their jobs obsolete or reduce their unfamiliar.
 Fear of the unknown – some people fear anything unfamiliar.
 Lack of awareness – comes as a result of lack of proper and adequate
information about the change.
 Social factors – people may resist change for fear of what others will
think.
5.2 Organizational Development (OD)
 Organization development is the process of planned change and improvement of
organizations through the application of knowledge of the behavioral sciences.
Yet, OD is not an easily defined single concept. Rather, it is a term used to
encompass a collection of planned change intervention built on humanistic-
democratic values that seek to improve organizational effectiveness and employee
well- being.
 Organizational Development (OD) is an attempt by the members of an
organization, with the help of a consultant, to achieve the fullest potential of the
organization as well as to correct any problems or shortcomings existing within it.
Change could result in every area of the organization— formal structure, informal
relationships, goals and objectives, communication patterns, decision-making
processes, relationship to the environment— as needed for optimum performance.

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In other words, when the organizational development effort begins, all phases of
the organization are subject to review. Based upon the findings of the review, a
program of change can be developed and implemented
The OD paradigm values human and organizational growth, collaborative and
participative process, and spirit of inquiry. The underlying values in most OD efforts
are:
 Respect for people- Individuals are perceived as being responsible,
conscientious, and caring. They should be treated with dignity and respect.
 Trust and support -aimed at inculcating trust, authenticity, openness and a
supportive climate.
 Power equalization- Effective organizations deemphasize hierarchical authority
and control. OD is aimed at empowering people in the organization.
 Participation- The more those people who will be affected by a change are
involved in the decisions surrounding that change, the more they will be
committed to implementing these decisions. In general, OD strongly suggests
collaborative process of problem diagnosis. I.e. all the members of the
organization who will be influenced by the problem should actively take a part in
the diagnosis phase, which possibly extended to search for the problems.
5.2.1 Processes of OD
The following are some of the brief steps in the process of OD
a. Diagnosis phase- at this stage the consultant should take a part in
diagnosis of the chronic problem and should assist the management.
b. Develop action plan or program- at this stage a change intervention
mechanism (strategy) will be developed and change agents actively take a
part in developing action programs.
c. Implementing phase- apply the suitable change strategies identified.
d. Evaluating the implemented change- mind you the ultimate purpose of
OD is to create an ongoing capacity of an organization to solve problems
stressing collaboration and cooperation.

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5.2.2 Managing Successful Organization Change and Development
So far, a lot has been discussed concerning what is changes; how change could be
initiated; why change is resisted; how planned change could be introduced and
implemented in an organization and related issues. Yet, this section will present what to
be considered for a change to be successful. Thus, what should be considered for
managing change successful? Here are some points:
 Take a Holistic view- organization subsystems are interrelated and interdependent,
therefore it is better to consider holistic view instead of a limited view of an organization.
That is to mean, a holistic view with respect to organization change encompasses the
culture and dominant coalition as well as the people, tasks, structure, and information
subsystem.
Start small- to be successful it is usually advised that, systemized change in large
organization should start small. A change could start with one team, usually executive
team. The team can evaluate the change, make appropriate adjustments along the way,
and most importantly, show that the new system works and gets desired results.
Significant changes started small with one or two parallel teams, and then spread as other
recognized the benefits of the change. When others see the benefits, they automatically
drop their inherent resistance and join in. They can voluntarily join and be committed to
the success of the change efforts.
Secure top management support- The support of top management is essential to the
success of any change.
Encourage participation- Problems related to resistance, control and power can be
overcome by broad participation in planning the change. Allowing people a voice in
designing the change may give them a sense of power and control over their own
destinies, which may help to win their support during implementation.
Foster open communication- Open communication is an important factor in managing
resistance to change and overcoming information and control problems during
transitions. Employees typically recognize the uncertainties and ambiguities that arise
during a transition and seek information on the change and their place in the new system.
Reward contributions- Employees who contribute to the change in any need to be
rewarded. Those who quickly grasp new work assignments, work harder to cover what

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otherwise might not get done during the transition, or help others adjust to changes desire
special credit. From behavioral perspective, individuals need to benefit in some way if
they are to willingly help change something that eliminates the old, comfortable way of
doing the job.
Consider international issue- Nowadays the world is becoming a global village due to
advance in information technology and globalization. Especially for multinational
organization it is advisable to consider international environment influence. Besides, to
consider successful international practices, experience as a benchmark could possibly
positively support the organization to implement change successfully. To sum up, in the
current dynamic environment, managers must anticipate the need for change and satisfy it
with more responsive and proactive systems.