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Chapter17.OrganizationalChangeandStressManagement.pptx

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Essentials of Organizational Behavior

Fifteenth Edition

Chapter 17

Organizational Change and Stress Management

Learning Objectives (1 of 2)

17.1 Contrast the forces for change and planned change.

17.2 Describe ways to overcome resistance to change.

17.3 Compare the four main approaches to managing organizational change.

17.4 Demonstrate three ways of facilitating change.

Learning Objectives (2 of 2)

17.5 Identify the potential environmental, organizational, and personal sources of stress at work as well as the role of individual and cultural differences.

17.6 Identify the physiological, psychological, and behavioral symptoms of stress at work.

17.7 Describe individual and organizational approaches to managing stress at work.

Forces for Change Learning Objective 17.1

Changing nature of the workforce

Technology

Economic shocks

Competition

Social trends

World politics

There are many forces that stimulate change, including the changing nature of the workforce, technology, economic shocks, competition, social trends, and world politics. All these things can drive change in a workplace.

The changing nature of the workforce is evident across industries. Technology is continually changing jobs and organizations. Economic shocks have a huge impact on organizations, leading to job loss, the death of organizations, and a long road to recovery. Competition precipitates change. Social trends do not remain static. Organizations must therefore continually adjust product and marketing strategies to be sensitive to changing social trends. And world politics also affect changes in organizations.

Reactionary versus Planned Change

Change: making things different

Planned change: change activities that are intentional and goal oriented

Change agents: people who act as catalysts and assume the responsibility for managing change activities

In this chapter, we address change as an intentional, goal-oriented activity.

Change is making things different from the way they were. Change activities that are intentional and goal oriented are planned changes. And change agents are people who act as catalysts and assume the responsibility for managing change activities.

Resistance to Change Learning Objective 17.2

People tend to resist change, even in the face of evidence of its benefits

Can be positive if it leads to open discussion and debate

Remember, not all change is good

Change agents need to carefully think through the implications

Whenever change is present, there is resistance to change. Individuals and groups become comfortable with things that are familiar, and change threatens the status quo. There are different ways that change is resisted by employees.

It is important to note that not all change is good. Speed can lead to bad decisions; sometimes those initiating change fail to realize the full magnitude of the effects or their true costs.

Change can be positive if it leads to open discussion and debate. But change agents need to carefully think through its implications.

Resistance to change does not just come from lower levels in the organization. Resistance does not necessarily surface in standardized ways. It can be overt, implicit, immediate, or deferred.

Sources of Resistance to Change (Exhibit 17-1)

There are many sources of resistance to change, as seen in this slide. It can take the form of individual resistance, such as fear of the unknown or security issues, or organizational resistance, such as threat to expertise, structural inertia, or limited focus of change.

Long Description:

The details are as follows:

Individual Sources:

Habit: To cope with life’s complexities, we rely on habits or programmed responses. But when confronted with change, this tendency to respond in our accustomed ways becomes a source of resistance.

Security: People with a high need for security are likely to resist change because it

threatens their feelings of safety.

Economic factors: Changes in job tasks or established work routines can arouse economic fears if people are concerned that they won’t be able to perform the new tasks or routines to their previous standards, especially when pay is closely tied to productivity.

Fear of the unknown: Change substitutes ambiguity and uncertainty for the unknown.

Selective information processing: Individuals are guilty of selectively processing information in order to keep their perceptions intact. They hear what they want to hear, and they ignore information that challenges the world they’ve created.

Organizational Sources:

Structural inertia: Organizations have built-in mechanisms—such as their selection processes and formalized regulations—to produce stability. When an organization is confronted with change, this structural inertia acts as a counterbalance to sustain stability.

Limited focus of change: Organizations consist of a number of interdependent subsystems. One can’t be changed without affecting the others. So limited changes in subsystems tend to be nullified by the larger system.

Group inertia: Even if individuals want to change their behavior, group norms may act as a constraint.

Threat to expertise: Changes in organizational patterns may threaten the expertise of specialized groups.

Threat to established power relationships: Any redistribution of decision-making authority can threaten long-established power relationships within the organization.

Overcoming Resistance to Change

Communication

Participation

Building support and commitment

Developing positive relationships

Implementing changes fairly

Manipulation and cooptation

Selecting people who accept change

Coercion

When managers face resistance to change, there are some useful tactics they can utilize to help people overcome it. These tactics include communication, getting people to participate in the process, and building support and commitment. It can also include developing positive relationships and being sure to implement the change fairly by applying a consistent and fair process, using manipulation and co-optation to spin the message in order to gain cooperation, or selecting people from the beginning who are more willing to accept change. Finally, a manager can resort to coercion, using direct threats and force to make people change. This is rarely a good option.

Approaches to Managing Organizational Change Learning Objective 17.3

Lewin’s Three-Step Model of Change

Kotter’s Eight-Step Model of the Change Process

Action Research

Organizational Development

There are four main approaches to managing organizational change. They are Lewin’s three-step model of change, Kotter’s eight-step model of the change process, action research, and organizational development.

Lewin’s Three-Step Change Model (Exhibit 17-2)

Lewin offers a three-step model to help facilitate the change process. He sets forth that change efforts need to “unfreeze” individual resistance and group conformity to help them move forward, and then you need to refreeze the changes by balancing driving and restraining forces. This will help to move people through the change process and solidify the desired behaviors/outcomes moving forward.

Unfreezing the Status Quo (Exhibit 17-3)

In the unfreezing stage, Lewin identifies driving and restraining forces. Driving forces are those that direct behavior away from the status quo. Restraining forces are those that hinder movement from the existing equilibrium.

Lewin’s model has been criticized for several reasons. Lewin assumes that change happens sequentially, in order, always progressing. The model implies a sense of perfect agency for managers where they know where they are, where the people in the organization are, and where they are going. Organizations are so fluid that it may be impossible to do this in real life. And others have mentioned that the “freezing” language is somewhat problematic.

Kotter’s Eight-Step Plan for Implementing Change (Exhibit 17-4)

Kotter also offers a model to look at change that builds on the initial ideas of Lewin. He sets forth the following eight sequential steps to overcome the problems he identified in a more detailed guide.

Establish a sense of urgency.

Form a coalition.

Create a new vision.

Communicate the vision.

Empower others by removing barriers.

Create and reward short-term “wins.”

Consolidate, reassess, and adjust.

Reinforce the changes.

Long Description:

The eight steps are as follows:

Establish a sense of urgency by creating a compelling reason for why change is needed.

Form a coalition with enough power to lead the change.

Create a new vision to direct the change and strategies for achieving the vision.

Communicate the vision throughout the organization.

Empower others to act on the vision by removing barriers to change and encouraging risk taking and creative problem solving.

Plan for, create, and reward short-term “wins” that move the organization toward the new vision.

Consolidate improvements, reassess changes, and make necessary adjustments in the new programs.

Reinforce the changes by demonstrating the relationship between new behaviors and organizational success.

Action Research

Action research: change process based on the systematic collection of data and the selection of a change action based on what the analyzed data indicate

Five steps:

Diagnosis

Analysis

Feedback

Action

Evaluation

Action research is a change process based on the systematic collection of data and the selection of a change action based on what the analyzed data indicate.

The five steps in the process are diagnosis, analysis, feedback, action, and evaluation.

Action research provides at least two specific benefits. First, it’s problem-focused. The change agent objectively looks for problems, and the type of problem determines the type of change action. A second benefit of action research is the lowering of resistance. Because action research engages employees so thoroughly in the process, it reduces resistance to change.

Organizational Development

Organizational development: a collection of change methods that try to improve organizational effectiveness and employee well-being

Organizational development is an area of study that is set up to determine what an organization needs to improve its effectiveness and employee well-being. Some organizational development values include respect for people, trust and support, power equalization, confrontation, and participation.

OD Interventions

Sensitivity Training

Change behavior through unstructured group interaction

Survey Feedback

Gathering data and acting on it

Process Consultation

Using outside consultants

Team Building

Increase trust and openness

Intergroup Development

Change attitudes, stereotypes, and perceptions

Appreciative Inquiry

Discovering what the organization does right

There are six commonly used organizational development techniques.

Sensitivity training tries to change behavior through unstructured group interaction.

The second technique is the survey feedback approach where the organization will use a questionnaire to identify discrepancies among member perceptions and then follow up with discussions and plans for improvement.

Process consultation is the third technique. This method involves a consultant who gives clients some insight into what is happening in the organization and helps to identify a process for improvement.

The fourth technique is engaging in team-building tools to increase trust and openness through increased interactions.

Intergroup development is an organizational development tool that attempts to change the attitudes, stereotypes, and perceptions that groups may have of each other.

Finally, appreciative inquiry seeks to identify the unique qualities and special strengths of an organization, which are used to build on to improve performance through a process. This process includes discovery (identifying the strengths of the organization), dreaming (speculating on the future of the organization), designing (finding a common vision), and destiny (deciding how to fulfill the dream).

Facilitating Change Learning Objective 17.4

Paradox theory: the key paradox in management is that there is no final optimal status for an organization

Some scholars have focused on a more proactive approach – how organizations can embrace change by transforming their cultures. Three approaches are managing paradox, stimulating innovation, and creating a learning organization.

Paradox theory states the key paradox in management is that there is no final optimal status for an organization.

There is some evidence that managers who think holistically and recognize the importance of balancing paradoxical factors are more effective, especially in generating adaptive and creative behaviors in those they are managing.

Stimulating a Culture of Innovation

Innovation: a new idea applied to initiating or improving a product, process, or service

Sources of innovation:

Organic structure

Contingent rewards

Slack resources

High interunit communication

Context and innovation

Innovation is a specialized kind of change applied to the beginning or improvement of a product, process, or service. Innovations can range from small incremental improvements to radical breakthroughs. Organizations can seek innovation through changing structure, creating a culture of creativity, or hiring an innovative workforce.

Organic structures positively influence innovation by facilitating flexibility, adaptation, and cross-fertilization that make the adoption of innovation easier. Contingent rewards also positively influence innovation. Having an abundance of resources allows an organization to afford to purchase innovations, institute them, and absorb failures. Finally, interunit communication is high in innovative organizations.

The more a country is characterized by strong social norms and low tolerance for any deviation from the norm, innovation tends to be stifled more often. Cultural diversity at the local level also has an impact. Having close interpersonal relationships with those from different culture backgrounds sparks innovation.

Idea Champions

Idea champions: actively and enthusiastically promote an idea, build support, overcome resistance, and ensure that innovation is implemented

Have high self-confidence, persistence, energy, and acceptance of risk

Use inspiration and vision to gain commitment

Have decision-making discretion

For innovation to occur there needs to be an idea champion who actively promotes the innovation.

An idea champion is someone who actively and enthusiastically promotes an idea, builds support, overcomes resistance, and ensures that innovation is implemented. A manager must have high energy and be willing to accept risk. They must use inspiration and vision to gain commitment and have the authority to make decisions.

Effective managers alter their organization’s championing strategies to reflect cultural values. In a collectivist culture, a cross-functional approach might be more effective, for example. Similarly, in high power-distance cultures, idea champions might work closely with superiors to get approval for innovative activity before work begins.

Creating a Learning Organization

Learning organization: an organization that has developed the continuous capacity to adapt and change

Managing learning:

Establish a strategy

Redesign the organization’s structure

Reshape the organization’s culture

Organizations proactively manage change by becoming a learning organization. A learning organization has developed the continuous capacity to adapt and change.

To make their organizations learning organizations, managers can establish a strategy, redesign the organization’s structure, and reshape the organization’s culture.

Characteristics of a Learning Organization (Exhibit 17-5)

A learning organization has five basic characteristics – one in which people put aside their old ways of thinking, learn to be open with each other, understand how their organization really works, form a vision everyone can agree on, and work together to achieve that vision.

Long Description:

The characteristics are listed below:

There exists a shared vision that everyone agrees on.

People discard their old ways of thinking and the standard routines they use for solving problems or doing their jobs.

Members think of all organizational processes, activities, functions, and interactions with the environment as part of a system of interrelationships.

People openly communicate with each other (across vertical and horizontal boundaries) without fear of criticism or punishment.

People sublimate their personal self-interest and fragmented departmental interests to work together to achieve the organization’s shared vision.

Stress at Work Learning Objective 17.5

Stress: a dynamic condition in which an individual is confronted with an opportunity, demand, or resource related to what is desired and for which the outcome is perceived to be both uncertain and important

Strain: a psychological and physical unpleasant response due to an appraisal of the stressor

When change occurs, stress is found throughout the organization. Stress is defined as a dynamic condition in which an individual is confronted with an opportunity, demand, or resource related to what he or she desires and for which the outcome is perceived to be both uncertain and important.

Strain is a psychological and physical unpleasant response due to an appraisal of the stressor.

Work is a Top Source of Stress (Exhibit 17-6)

Work is a major source of stress in most people’s lives.

Long Description:

The details are as follows:

Nation’s future: 63%

Money: 62%

Work: 61%

Political climate: 57%

Crime; Example: Violence: 51%.

Stressors

Challenge Stress: associated with workload, pressure to complete tasks, and time urgency

Can be positive

Hindrance Stress: comes from obstacles to achieving goals

Mostly negative

Usually stress is associated with demands and resources

Allostasis: working to change behavior and attitudes to find stability

There are different types of stress. Challenge stress is stress associated with workload, pressure to get work done, and time constraints. Hindrance stressors are those things that keep you from reaching your goals, such as uncooperative employees or red tape. This can cause more stress than challenge stress often does.

Stress is typically associated with demands (responsibilities, pressures, obligations, and uncertainties individuals face in the workplace) and resources (things within an individual’s control that he can use to resolve the demands).

While early research tended to emphasize such a homeostatic, or balanced equilibrium, perspective, it has now become clear that no single ideal state exists. Instead, it’s more accurate to talk about allostatic models, in which demands shift, resources shift, and systems of addressing imbalances shift. Through allostasis, we work to find stability by changing our behaviors and attitudes.

A Model of Stress (Exhibit 17-7) Learning Objective 17.6

What causes stress?

Environmental factors influence stress levels. Uncertainty is the biggest reason people have trouble coping with organizational changes. Organizational factors are categorized around task, role, and interpersonal demands.

Individual variables include perception, job experience, social support, and personality traits.

Research suggests that the job conditions that cause stress show some differences across cultures. One study revealed that whereas U.S. employees were stressed by a lack of control, Chinese employees were stressed by job evaluation and a lack of training. Personality effects on stress are different across cultures.

Stress shows itself in a number of ways, such as high blood pressure, ulcers, irritability, difficulty making routine decisions, changes in appetite, accident proneness, and the like. These symptoms fall under three general categories: physiological, psychological, and behavioral symptoms.

Long Description:

The details of the model are as follows:

In this model, a flow is shown between the potential sources, individual differences, and cultural differences that lead to experienced stress and its various consequences.

There are three types of potential sources: environmental, organizational, and personal. Under each of these are various factors as listed below:

Environmental factors: Economic uncertainty, political uncertainty, and technological change.

Organizational factors: Task demands, role demands, and interpersonal demands.

Personal factors: Family problems and economic problems.

The factors under individual differences are listed below:

Perception

Job experience

Social support

Personality traits.

The resultant consequences include physiological, psychological, and behavioral symptoms.

Physiological symptoms include: Immediate effects, illness, and chronic health conditions.

Psychological symptoms include: Anxiety, lower emotional well-being, and lower job satisfaction.

Behavioral symptoms include conditions like: lower job performance, higher absenteeism, and higher turnover.

Managing Stress Learning Objective 17.7

Organizational

Selection, placement & training

Goal-setting

Job redesign

Employee involvement

Organizational communication

Employee sabbaticals

Wellness programs

Individual

Time management

Physical exercise

Relaxation techniques

Social support network

Stress needs to be managed and maintained at a healthy level. Individuals often manage stress through time management techniques, physical exercise, relaxation techniques, or expanding their social support network. Organizations can also help employees manage stress by providing training, realistic goal setting, re-designing jobs, offering employee sabbaticals, and establishing a wellness program.

Implications for Managers

You are a change agent in your organization. The decisions you make and your role-modeling will help shape the organization’s change culture.

Management policies and practices will determine the degree to which the organization learns and adapts to changing environmental factors.

Some stress is good.

You can help alleviate harmful workplace stress for your employees by accurately matching workloads to employees, providing employees with stress-coping resources, and responding to their concerns.

You can identify extreme stress when performance declines, turnover increases, health-related absenteeism increases, and engagement declines. Stay alert for early indicators and be proactive.

Change is inevitable, especially in today’s market, so it is critical for managers to have the skill set to deal with it, as it impacts every aspect of organizational behavior.

If an organization is to remain competitive, it must learn to operate in a changing environment. Managers must take on the role of change agents and be the champions for innovation.

Discussion Questions

Discuss a change initiative placing it within the context of Lewin’s three-step model. Identify the driving forces and the restraining forces.

Discuss your stressors at work. Identify the stressors by category (environmental, organizational, and personal). What are some of the individual approaches to managing stress that you might use?

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