Types of Organisational Change
Different types of organisational change are given as follows:
1) Happened Change: This change is unpredictable and takes place naturally due to external factors. It is traumatic or profound for it is out of direct control and produces a future state that is largely unknown. This type of change occurs when an organisation reaches a plateau in its lifecycle and falls prey to unwieldy demands from the environment.
2) Reactive Change: It occurs when forces to change make it important for a change to be implemented. New scientific and technological discoveries, new strategic moves made by competitors, and performance problems are common reasons for reactive change.
3) Anticipatory Change: Change that is carried out in expectation of an event or a series of events is called anticipatory changes. Failing to anticipate future events can have destructive results for organisations. Their anticipation of change may tune in or re-orient themselves to future demands.
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4) Planned Change: It occurs when leaders in the organisation recognise the need for a major change and proactively organise a plan to accomplish the change. Planned change happens with the successful implementation of a plan for re-organisation, strategic plan, or other implementation of a change of this extent. It is based on a well-done and proactive plan and usually does not occur in a highly organised fashion.
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5) Strategic Change: Strategic change is the change in the very basic objectives or mission of the organisation. A simple objective may have to be changed to numerous objectives. For example, a lot of Indian companies are being modified to accommodate different aspects of global cultures brought in by multinational or transnational corporations.
6) Process-Oriented Change: These changes relate to the recent technological developments, information processing, and automation. This will involve re-training or replacing personnel, heavy capital equipment investment and operational changes. All this will affect the organisational culture and as a result the behaviour pattern of the people.
7) People-Oriented Change: People-oriented changes are directed towards performance improvement, group cohesion, dedication and loyalty to the organisation as well as developing a sense of self-actualisation among members. This can be made possible by closer interaction with employees and by modification sessions and special behavioural training.
8) Operational Change: This is necessitated when an organisation needs to improve the quality of its products or services due to external competition, customers changing requirements and demands or internal organisational dynamics. The organisation’s goals remain the same, intended change focuses on how to improve existing operations to perform them better. Operational changes include bringing in re-engineering the work processes, new technology, quality management, better delivery and distribution of products, and improving interdepartmental coordination.
9) Directional Change: A change in direction may become imperative for an organisation due to severe competition or regulatory shifts in government policy and control (e.g., on pricing, import, and export restrictions). Directional change is also critical when the organisation is developing a new strategy of incapable of executing effectively its current strategy.
10) Fundamental Change: Fundamental change entails a re-definition of the current purpose or mission of the organisation. It may be necessitated by drastic changes in the business environment, the failure of the current corporate leadership, problems with employee low turnover or morale.
11) Total Change: For a total change, the organisation is constrained to develop a new vision, and a strong link between its strategy, employees, and business performance. The organisation has to achieve a turnaround.
Total change is essential to extricate the organisation from the rot that has set in due to long-term failure of a business, employee-organisation value incongruence, and power concentrated in the hands of a few people who could be furthering their own personal interests at the cost of the organisation.
12) Transformational Change: This change occurs after the transition period. Transformational change may involve both transitional and developmental change. When companies are faced with the emergence of radically different technologies, significant changes in supply and demand, unexpected competition, and lack of revenue, developmental or transitional change may not offer the organisation the solution they need to stay competitive. Instead of methodically implementing new processes, the company may be forced to drastically transform themselves.
13) Structural Change: Structural change involves changing the internal structure of the organisation. This change may be in the whole set of work assignments, relationships, and authority structures.
14) Recreational Change: The word recreation is derived from the Latin word recreate, which means “to create anew, to become refreshed”. It is the refreshment of strength or spirit, reinvigoration or rebirth. Recreation is basically a “renewing” experience a refreshing change from work and the daily routine.
15) Evolutionary Change: Incremental change is an ongoing process of evolution over time, during which many small changes occur routinely. Over time the cumulative effect of many little changes may be to change the organisation. It is directed at the micro-level and focused on units/sub-units/components within an organisation. These changes are brought in gradually and are usually adaptive in nature.
16) Revolutionary Change: Revolutionary change is rapid, dramatic, and broadly focused. Revolutionary change involves a bold attempt to fastly find new ways to be effective. It is likely to result in a radical shift in ways of doing things, new goals, and a new structure of the organisation.
Process of Organisational Change
Organisational change is a complex process that involves various stages. These stages must follow a certain sequence. The sequences of stages in which the change process must take place are shown in the figure.
1) Problem Recognition: In the problem recognition stage, the management acknowledges that a problem exists in the organisation. The data gathering processes in the organisation highlight the problems in the organisation, which affect its productivity and thus make the management aware that a problem exists.
Employee turnover, absenteeism, union disputes, employee grievances, high cost of production, role conflicts, and declining profits are some examples of problems that affect the productivity of organisations.
2) Identifying the Causes of Problems: In this stage, management must find out the root cause of the problems identified in the problem recognition stage. For example, if declining profitability is identified as the major problem facing the organisation, it could be attributed to reasons such as a decline in employee productivity, increase in the production of waste in the manufacturing stages, reduction in orders from clients, etc.
3) Implementing the Change: After holding discussions with employees and analysing the feedback gathered through questionnaires, the management will be able to identify the underlying causes of organisational problems. The management must then design a change plan to improve the situation and solve the problems.
To convince employees to participate in the change process, management should have a clear vision of the outcomes of the plan and how it would benefit the organisation and its employees in the long term
A change plan can succeed only:
- i) If the employees are motivated enough to participate voluntarily in the change process.
- ii) If all the concerns of various employee groups are addressed and there is no resistance to change efforts.
- iii) If reinforcement of the change continues even after the change process has formally ended.
4) Generating Motivation for Change: Three strategies to motivate employees to embrace change:
- i) Management should constantly make employees realise the shortcomings in the existing system so that the resulting dissatisfaction will make them welcome the change initiatives in the organisation management should ensure that the change programme does not worsen the situation or fall short of the employees’ expectations.
- ii) Employees should be given a role to play in the change process. Participation promotes a sense of ownership among the employees towards the change process and encourages them to contribute to its success.
- iii) Employees who successfully adopt the desired behaviour should be rewarded. This is an effective way of encouraging employees to welcome change.
5) Managing the Transition State: The change process disturbs the status quo of an organisation. For example, when an organisation adopts an informal culture, job profiles and reporting relationships change and the old rules and procedures are no longer applicable.
Employees will be in a confused state during the change from the existing system to the new system. They may not know what their new roles are what skills are required to perform their new roles, whom they should report to, what the new performance criteria are and so on.
Since change has to be implemented throughout the organisation, one person (for example, a transition manager) should be placed in charge of the entire change process to coordinate the change efforts of various departments and units within the organisation.
6) Supporting the Change: To implement change successfully, management must obtain the cooperation and support of various employee groups. This can be achieved through negotiation, co-optation and compromise. Failure to obtain the support of employee groups may result in resistance to the change programme.
Some of the influential employees in an organisation should be assigned the task of implementing change. Such employees have the power to influence and educate other employees about the benefits of change and motivate them to accept the change. Thus, they play a key role in facilitating the process of change in the organisation.
7) Evaluating the Change: After its implementation, the changes must be evaluated to check ether the new system has been able to solve the problems identified in the old system and whether the desired future state has been attained. If the new system fails to solve the problems, or discrepancies are found between the new system and the expected state, something has clearly gone wrong with the change process.
In such a case, all the stages of the change process from the problem diagnosis to the evaluation stage must be repeated once again. Sometimes, the change process may solve the existing problems, but also create new problems. Management must act quickly to address these problems to enable organisations to benefit from the change process.