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Employee Motivation, Adjustment and Values as Correlates of Organizational Change

Anurakti Mathur

Amity Institute of Psychology and Allied Sciences, Amity University, Noida E-mail: [email protected]

Abstract

Change is inevitable in any organization. Every one fears the unknown before the change takes place, however after the change event there is a severe problems that the employees may face with regards to adjustment to the disturbances that the change has created. The present research sets out with an aim to understand the effect of organizational change on Employee Motivation, Adjustment and Values in an organization that has recently undergone massive organizational change. This research was conducted on a sample of 50 employees who are working in an organization which has experienced a major change in the recent past. Data was obtained through questionnaires devised for the purpose of this research keeping in mind the above mentioned variables. The findings show that the respondents have revealed the tendency to try and maintain moderate levels of motivation after the change. They also try to make the desired adjustments that are required in order to cope with the multiple roles in the organization. The values shift from achievement to personal survival ones to maintain ones existence in the organization and to function as a well-balanced individual. Keywords: Motivation, Values, Organizational Change

Introduction Changing organisations involves building a network of relationships between organisational entities that are defined and shaped (against various resistances) to contribute towards some particular goal of change (Law, 2000). Or, as Brunsson and Sahlin-Andersson (2000) suggest, the construction of entities so that they come to resemble some general or abstract concept of organisation – perhaps one that is perceived to be somehow more “complete”. In the context of recent public sector reform in a number of Western countries, much organisational change can be seen as representing attempts to reconstruct public sector organisations as more consistent with popular notions of “modern management” taken from the private sector.

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An operational definition of ‘organisational change’ While the phrase ‘organisational change’ is much used in management discourse it is a phrase, like the word ‘management’, that is rarely defined at a conceptual level. It is clearly not a unitary concept as organisational change can be implemented using a variety of instruments either in series or, as our data show, more often in parallel. Change may be further explained in terms of its various types that the researchers have divided it into. Planned versus emergent change Sometimes change is deliberate, a product of conscious reasoning and actions. This type of change is called planned change. In contrast, change sometimes unfolds in an apparently spontaneous and unplanned way. This type of change is known as emergent change. An important (arguably the central) message of recent high-quality management of change literature is that organisation-level change is not fixed or linear in nature but contains an important emergent element. Episodic versus continuous change Another distinction is between episodic and continuous change. Episodic change, according to Weick and Quinn (1999), is ‘infrequent, discontinuous and intentional’. Sometimes termed ‘radical’ or ‘second order’ change, episodic change often involves replacement of one strategy or programme with another. Continuous change, in contrast, is ‘ongoing, evolving and cumulative’ (Weick and Quinn, 1999). Also referred to as ‘first order’ or ‘incremental’ change, continuous change is characterised by people constantly adapting and editing ideas they acquire from different sources. At a collective level these continuous adjustments made simultaneously across units can create substantial change. The distinction between episodic and continuous change helps clarify thinking about an organisation’s future development and evolution in relation to its long-term goals. Few organisations are in a position to decide unilaterally that they will adopt an exclusively continuous change approach. They can, however, capitalise upon many of the principles of continuous change by engendering the flexibility to accommodate and experiment with everyday contingencies, breakdowns, exceptions, opportunities and unintended consequences that punctuate organisational life (Orlikowski, 1996). Developmental, transitional and transformational change Change can also be understood in relation to its extent and scope. Ackerman (1997) has distinguished between three types of change: developmental, transitional and transformational.

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1. Developmental change may be either planned or emergent; it is first order, or incremental. It is change that enhances or corrects existing aspects of an organisation, often focusing on the improvement of a skill or process. 2. Transitional change seeks to achieve a known desired state that is different from the existing one. It is episodic, planned and second order, or radical. The model of transitional change is the basis of much of the organizational change literature (see for example Kanter, 1983; Beckhard and Harris, 1987; Nadler and Tushman, 1989). It has its foundations in the work of Lewin (1951) who conceptualised change as a three-stage process involving: • unfreezing the existing organisational equilibrium • moving to a new position • refreezing in a new equilibrium position. 3. Transformational change is radical or second order in nature. It requires a shift in assumptions made by the organisation and its members. Transformation can result in an organisation that differs significantly in terms of structure, processes, culture and strategy. It may, therefore, result in the creation of an organisation that operates in developmental mode – one that continuously learns, adapts and improves. Systems thinking and change Many of the approaches to organisational change found in the literature give the impression that change is (or can be) a rational, controlled, and orderly process. In practice, however, organisational change is chaotic, often involving shifting goals, discontinuous activities, surprising events, and unexpected combinations of changes and outcomes (Cummings et al., 1985; Dawson, 1996). Accordingly, change can be understood in relation to the complex dynamic systems within which change takes place. Systems are described as closed or open. Closed systems are completely autonomous and independent of what is going on around them. Open systems exchange materials, energy and information with their environment. The systems of interest in managing change can all be characterised as open systems. In terms of understanding organisations, systems thinking suggest that issues, events, forces and incidents should not be viewed as isolated phenomena but seen as interconnected, interdependent components of a complex entity. Areas of Change Organizations typically respond to the challenges of new technologies, new competitors, new markets, and demands for greater performance with various programs, each designed to overcome obstacles and enhance business performance. Generally, these programs fall into one of the following categories:

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• Structural change.–These programs treat the organization as a set of functional parts— the “machine” model. During structural change, top management, aided by consultants, attempts to reconfigure these parts to achieve greater overall performance. Mergers, acquisitions, consolidations, and divestiture of operating units are all examples of attempts at structural change. • Cost cutting.–Programs such as these focuses on the elimination of nonessential activities or on other methods for squeezing costs out of operations. Activities and operations that get little scrutiny during profitable years draw the attention of cost cutters when times are tough. • Process change.–These programs focus on altering how things get done. Examples include reengineering a loan approval process, the company’s approach to handling customer warranty claims, or even how decisions are made. Process change typically aims to make processes faster, more effective, more reliable, and/or less costly. • Cultural change.–These programs focus on the “human” side of the organization, such as a company’s general approach to doing business or the relationship between its management and employees. A shift from command-and-control management to participative management is an example of cultural change. Two Different Approaches to Change While there are many types of change programs, two very different goals typically drive a change initiative: near-term economic improvement or an improvement in organizational capabilities. Harvard Business School professors Michael Beer and Nitin Nohria coined the terms “Theory E” and “Theory O” to describe these two basic goals. Theory E: An Economic Approach The explicit goal of Theory E change is to dramatically and rapidly increase shareholder value, as measured by improved cash flow and share price. Popular notions of employee participation and the “learning organization” take a back seat to this overarching goal. Financial crisis is usually the trigger for this approach to change. Driven to increase shareholder value, Theory E proponents rely heavily on mechanisms likely to increase short-term cash flow and share price: performance bonuses, headcount reductions, asset sales, and strategic reordering of business units. According to Theory E, all implicit contracts between the company and its employees, such as lifetime employment, are suspended during the change effort. Individuals and units whose activities fail to demonstrate tangible value creation The CEO and the executive team drive Theory E change from the top

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Theory O: An Organizational Capabilities Approach The goal of Theory O change is to develop an organizational culture that supports learning and a high performance employee base. Companies that follow this approach attempt to invigorate their cultures and capabilities through individual and organizational learning. And that requires high levels of employee participation, flatter organizational structure, and strong bonds between the organization and its people. Because employee commitment to change and improvement are vital for Theory O change to work, implicit contracts with employees are considered too important to break. The leaders of Theory O change are less interested in driving the success themselves than in encouraging participation within the ranks, and in fostering employee behaviors and attitudes that will sustain such change. Employee Psychological Dynamics during Organisational Change A debate exists over the reactions that individual employees have towards change. While there has been a long tradition of researchers who argue that employees tend to resist organisational change in general (e.g. Judson 1991; Odiorne 1981; Strebel 1996), Dent and Goldberg (1999) argue that the term ‘resistance’ should be removed from the literature as it does not reflect the complex interactions that occur during change. Piderit (2000) takes a more conciliatory view suggesting that the ambivalence that employees feel towards change does not always produce resistance, but generally produces confusion. Regardless of what term is used, there is a wealth of literature that shows that employee ambivalence to management change initiatives is often linked to dysfunctional conflict during organizational change and associated with negative outcomes such as job dissatisfaction and expressed grievances (Kirkman, Jones & Shapiro 2000). Employees who are expending their energy on these types of reactions to change have less energy for participating or contributing to that change. Therefore, identifying factors that moderate this change resistance would be beneficial to both the individuals involved in the change process and the organisation. Examining organisational behaviour, researchers have identified change as having the potential to elicit a broad range of emotion whether the transformation is a major restructure or minor re-organisation (Mossholder et al., 2000). Change can be perceived as a challenge or an opportunity and triggers positive emotions such as excitement, enthusiasm and creativity (Goleman, Boyatzis & McKee 2002). Change can also, however, be threatening and create negative emotions such as anger, fear, anxiety, cynicism, resentment, and withdrawal (French 2001). Clearly change poses significant challenges, both to those who implement and those who are affected by the change (O’Neill & Lenn 1995). Management theory, however, tends to focus on cognitive issues such as cognitive dissonance during change (Bacharach, Bamberger & Sonnenstuhl 1996). The result of this focus is consideration of solutions in dealing with attitudes to

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change, rather than emotional reactions (e.g. Brockner 1988; Brockner, Grover, Reed & DeWitt 1992). A small body of research that has examined the role of emotion during organisational change has largely focused on emotional responses such as stress (Terry & Jimmieson 2003), and behaviours such as withdrawal and low organisational commitment (Begley & Czajka 1993), thereby ignoring the emotive/cognitive processes that engender such outcomes (O’Neill & Lenn 1995). Work Motivation Work motivation may be defined as the internal or external force that compels an individual to perform optimally in the organization where he is employed. Work motivation has been found to be positively related to job satisfaction, performance and organizational commitment. The motives may be extrinsic or intrinsic in nature. Extrinsic motives are tangible or visible to others. They are distributed by other people. In the workplace extrinsic motives include pay, benefits, promotions etc. extrinsic motives also include the drive to avoid punishment, such as termination or being transferred. In each situation an external agent distributes these items. Furthermore, extrinsic rewards are usually contingency based. That is, the extrinsic motivator is contingent on improved performance, or performance that is superior to others in the same workplace. Extrinsic motivators are necessary to attract people into the organization and keep them on the job. They are also used to inspire workers to achieve at higher levels or to reach new goals, as additional payoffs are contingent on improved performance. They do not, however, explain every effort made by an individual employee. Intrinsic motives are internally generated. In other words, they are motivators that the person associates with the task or job itself. Intrinsic reward include feeling of responsibility, achievement, accomplishment, that something was learned from experience, feeling of being challenged or competitive, or that something was an engaging task or goal. Performing meaningful work has also been associated with intrinsic motivation. The two types of motivators are not completely distinct from one another. Many motivators have both extrinsic and intrinsic components. Cognitive Evaluation Theory suggests a more complicated relationship. This theory says that a task may be intrinsically motivating, but when an extrinsic motivator becomes associated with that task, the actual level of motivation may decrease. In other words, extrinsic motivation may actually undermine intrinsic motivation. But there is considerable research evidence that extrinsic reward may not detract from intrinsic motivation and at least for interesting, challenging tasks, extrinsic reward may increase the level of intrinsic motivation.

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According to David McClelland there are three major types work motivators need for achievement (n-ach), need for power (n power) and the need for affiliation (n aff). These set of needs are said to guide and direct employee motivation in the organizational setting. The Power Motive: Winter (1973) has defined social power as “the ability or capacity of a person to produce (consciously or unconsciously) intended effects on the behaviour and emotions of another person”. The goal of power motivation are to influence, control, cajole, persuade, lead, charm others and to enhance ones own reputation in the eyes of other people. People with strong power motivation derive satisfaction from achieving these goals. The leading advocate of the power motive was the psychologist, Alfred Adler. To explain the need for power- the need to manipulate others or drive for being in charge of others- Adler developed the concept of inferiority complex and compensation. He felt that every small child experiences a sense of inferiority. When this feeling of inferiority is combined with what he sensed as an innate need for superiority, the two rule all behaviour. The person’s lifestyle is characterized by striving for compensation for the feeling of inferiority, which are combined with the innate need for power. Power motivation varies in strength from person to person and situation to situation in the same person. It may be expressed in many ways; the manner of expression depends greatly on the person’s socioeconomic status, sex, level of maturity, and the degree to which the individual fears his or her own power motivation. There are five categories of power:

 Reward Power: This source of power is based on a person’s ability to control resources and reward others. In addition, the target of this power must value these rewards. If the managers offer their people what they think are rewards, but the people do not value them, then managers do not really have reward power. By the same token, the managers may not think that they are giving rewards to their people, but if they perceive this to be rewarding, the managers nevertheless have reward power. Also managers may not really have the rewards to dispense, but as long as people think they have it, they do indeed have reward power.

 Coercive Power: This source of power depends on fear. The person with coercive power has the ability to inflict punishment or aversive consequences on another person or, at least make threats that the other person believes will result in punishment or undesirable outcomes. Managers frequently have coercive power in that they can fire or demote people who work for them or dock their pay. A

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manager can also directly or indirectly threaten an employee with these punishing consequences.

 Legitimate Power: This power source, identified by French and Raven, stems from the internalized values of the other person that give the legitimate right to the agent to influence them. The others feel that they have the obligation to accept this power. It is closely aligned with both reward and coercive power because the person with legitimacy is also in a position to reward and punish. But unlike reward and coercive power it does not depend on the relationships with others rather on the position or role that the person holds. Managers generally have legitimate power because employees believe in the value of private property laws and in the hierarchy where higher positions have been designated to have power over lower positions. People can obtain legitimate power from accepted social structure or from being designated as the agent or representative of a powerful person or a group.

 Referent Power: This type of power comes from the desire on the part of the other person to identify with the agent wielding power. They want to identify with the powerful person, regardless of the outcome. The others grant the person power because he or she is attractive and has desirable resources or personal characteristics. Managers with referent power must be attractive to their people so that they will want to identify with them, regardless of whether the managers later have the ability to reward or punish or whether they have legitimacy. The manager who depends on referent power must be personally attractive to the subordinates.

Expert Power: This source of power is based on the extent to which others attribute knowledge and expertise to the power holder. Experts are perceived to have knowledge or understanding only in certain well defined areas. The target must perceive the agent to be credible, trustworthy, and relevant before expert power is granted. Staff specialists have expert power in their functional areas but not outside them. Expert power is highly selective, and, besides credibility the agent must also have trustworthiness and relevance. Managers and staff specialists, who seldom have the other sources of power available to them, often have to depend on their expertise as their only source of power. As organizations become increasingly technologically complex and specialized, the expert power of the organization members at all levels has become more and more important. This is formally recognized by some companies that deliberately include lower level staff members with expert power in top level decision making Research Objectives The research has been conducted with an objective of understanding the psychological after-effects of organisational change on the employees of that organisation. For this

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purpose few aspects of the human psyche such as motivation (extrinsic and intrinsic), adjustment(personal and professional), and values have been incorporated, though many other aspects have been left out due to the constraints faced by the researcher and in order to narrow down the scope of the study. Thus the research has been carried out keeping the following aims in mind:

 To study the level of professional adjustment of employees after a change event.

 To study the personal adjustments that the employees make to fit into their organisations after change has occurred.

 To study the level of motivation in employees after a change event with respect to need for power, affiliation and achievement.

 To study the job related value system in-place in the employees after the change process.

Review of Literature The present research is aimed to develop a theoretical understanding of psychological dynamics of the employee during the organisational change, informed by a perspective on employee work values, motivation and adjustment. This chapter provides a literature review that introduces the issue of employee’s psychological aspect during organisational change. The review draws primarily on the psychological literature focusing on aspects of the human psyche like motivation, values and adjustment. Research on Nature of Organisational Change The increasing pace of global, economic and technological development makes change an inevitable feature of organisational life (Cummings & Worley, 1997). Organisations are often ineffective at managing the psychological components of organisational change (Bennett & Durkin, 2000) and it has been noted that there is considerable room for improving the effectiveness of change efforts (Porras & Robertson, 1992). Kotter (1995) noted that as many as 90% of initiatives fail to achieve their strategic objectives mainly due to human factors such as change related responses, attitudes and behaviours. Organisations cannot achieve their strategic change objective until a critical mass of employees has successfully completed their individual transitions (St Amour, 2001). Armenakis, Harris and Mossholder (1993) argued that employee attitude towards organisational change affect not only the success of the change process but other important organisational outcomes such as job satisfaction, productivity, morale, absenteeism and turnover (Eby, Adams, Russell & Gaby, 2000). The costs involved with such consequences may be directly attributable to the distress that is created when an organisation’s employees encounter constant change (Mack, Nelson & Quick, 1998).

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Large scale organisational change is defined as change that encompasses the entire organisation, has occurred over a number of years, and involves fundamental modifications in ways of thinking about the business, the organisation, and how the organisation is managed (Nadler, 1988). This type of change has important and often underestimated psychological implications for the employees. The necessary adjustments can foster enthusiasm and opportunities for learning and growth or, alternatively, can lead to frustration and alienation (Thompson & Van de Ven, 2001). Judge, Thoresen and Welbourne (1999) argued that organisational change research has been dominated largely by macro systems oriented focus and that a limited number of studies of organisational have taken a micro level, psychological approach. Hence assessing the impact of organisational change on employee attitudes and behaviours is identified as an important research direction. Despite widespread research on why and how organisations change, what constitutes change is often taken for granted. Its definition is avoided. Studies based on individuals' rational choice imply that change flows from purposive actions in accordance with an objective, external reality whereas contextualism argues that change results from institutional pressures, isomorphism, and routines. But both depict change as the passage of an entity, whether an organisation or accounting practices, from one identifiable and unique status to another. Despite their differences over whether reality is independent, concrete and external, or socially constructed, both assume that actors (or researchers) can identify a reality to trace the scale and direction of changes. This reflects modernist beliefs that organisational space and time are unique and linear. Many organisations are implementing major changes in the way they do business in response to growing international competition, a significantly changing workforce, increasingly complex and changing work environments, and other pressures (Lawler, 1986, Manz, 1992). As an organisation strives to maintain their competitive edge they are reorganising, downsizing and implementing new technology. Ultimately, new and additional job demands are placed on individuals within these organisations. These changes are inevitable inn today’s work environment. Also inevitable is the fact that employees must adapt to these constantly changing environments in order to survive and prosper. Development of a body of knowledge about managing change is an important body of knowledge for both academics and for general managers (Beer, 1987). The need for adaptive workers has become increasingly important due to the fact that today’s organisations are characterised by changing, dynamic environments (Pulakos, Arad, Donovan, & Palmondon, 2000, Ilgen &Pulakos, 1999). In a recent article stressing the attributes graduates need to enter the workforce, adaptability to the changing work environment was at the top of the list (Gow & Mc Donald, 2000).

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In today's turbulent, often chaotic, environment, commercial success depends on employees using their full talents. Yet in spite of the myriad of available theories and practices, managers often view motivation as something of a mystery. In part this is because individuals are motivated by different things and in different ways. In addition, these are times when delayering and the flattening of hierarchies can create insecurity and lower staff morale. Moreover, more staff than ever before are working part time or on limited-term contracts, and these, employees is often especially hard to motivate. Organisational Change and Employee Motivation Twyla Dell writes of motivating employees, "The heart of motivation is to give people what they really want most from work. The more you are able to provide what they want, the more you should expect what you really want, namely: productivity, quality, and service." (An Honest Day's Work (1988). In his research London (1983) found that a resilient workforce is better equipped to deal with the organisational change. He found that organisations which have resilient and thriving employees have a more motivated workforce that works towards the success of the organisational change. Also, findings support the fact that a motivated and positive employees is very less likely to be prone to turnover and absenteeism. Change can be perceived as a challenge or an opportunity and triggers positive emotions such as excitement, enthusiasm and creativity (Goleman, Boyatzis & McKee 2002). Change can also, however, is threatening and create negative emotions such as anger, fear, anxiety, cynicism, resentment, and withdrawal (French 2001). Clearly change poses significant challenges, both to those who implement and those who are affected by the change (O’Neill & Lenn 1995). Management theory, however, tends to focus on cognitive issues such as cognitive dissonance during change (Bacharach, Bamberger & Sonnenstuhl 1996). The result of this focus is consideration of solutions in dealing with attitudes to change, rather than emotional reactions (e.g. Brockner 1988; Brockner, Grover, Reed & DeWitt 1992). A small body of research that has examined the role of emotion during organisational change has largely focused on emotional responses such as stress (Terry & Jimmieson 2003), and behaviours such as withdrawal and low organisational commitment (Begley & Czajka 1993), thereby ignoring the emotive/cognitive processes that engender such outcomes (O’Neill & Lenn 1995). A research conducted by Chew Man Min and Petrovic-Lazarevic (2005) found that high spirited employees are better equipped to maintain harmonious working relationships with their colleagues and continue keeping high morale while facilitating the same for others in their team and the organisation as a whole. It is imperative that managers always maintain a pleasant workplace for the employees there by keeping them

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motivated as a dull, stressful and unmotivated organisational environment will bring harm to nay business. In any organisation, any change initiative which is not supported by the managers as employees become demotivated and low spirited and cannot sustain the humungous task of carrying out the change initiative on their own. In such organisations employees feel totally lost and direction less and often fear the change event as there is no one to motivate them or spur them on there by encouraging them to carry out the change. Thus motivation is of utmost importance in to build a sustainable competitive advantage and carry out change successfully. All employees are generally afraid of the change involved in any business and the impending effects that the change and the new organisational setting will have on their job process and job situation. The idea and concept behind the change and the new work process should be sold to the employees before the actual steps towards implementing the change in the organisation are taken. Managers need to emphasise the benefit that the change will bring for the employees and how it is not a threat but an enhancement to their jobs. Organisational Change and Adjustment: The impact of organisational change on employee adjustment has emerged as an important area of research due to high emotional and financial costs to employees and organisations when the change is not managed well. Terry et al. (1996) found that the application of Lazarus and Folkman’s (1984) cognitive phenomenological framework proved a useful approach. This model focuses on how individuals appraise the change event, their coping response and the extent to which access to personal and social coping resources determine their levels of adjustment to corporate change. The success of organisational change initiatives is often determined by employee attitudes towards the change (Almaraz, 2000; Beer, Eisenstadt, & Spector, 1990). In addition to their effect on the success of change initiative, employee attitudes towards a pending change can have wider impact in terms of job satisfaction, organisational commitment, morale, productivity and turnover intentions (Wanberg & Banas, 1997). Another study by Judge, Welbourne, et al (1999) shows that variables like job satisfaction, organisational commitment etc have a very positive correlation with how well an individual copes with change. Research by Wanberg and Banas (2000) found that employee attitudes towards change, acceptance of and opinion about change were positively related to job satisfaction. Also employees with lesser tendency to adapt to on- going change process has lower levels of job satisfaction, higher work related irritation and a higher intention to quit their organisation. According to McManus et al. (1995) and

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Schneider and Bowen (1993), if an organisation is attempting to create a climate that values change, the importance of change may be evident in employee attitudes, relationships, job characteristics, availability and quality of resources and the context in which the organisation operates. Hence to improve employee adjustment during change, priority should be place on improving the organisational climate and developing aspects of it which act as resources that assist employees to engage in positive appraisal of change. Change for an individual is organisational usually means loss of power as responsibility and accountability are shifted. It can also mean that critical relationships and new patterns pf interactions are demanded. Additionally, there are potential losses in reward, particularly status and monetary rewards as power shifts, and losses in identity as the meaning people make of their work lives is threatened by changes in the organisation (Beer, 1987). Theory and past research suggests that change is traumatic for individuals within an organisation (Callan, Terry & Schweitzer, 1994, Burke, 1988). The degree of trauma will depend on the nature of change. In the psychological literature, there has been much discussion surrounding how trauma events shatter our fundamental schemas (Janoff-Bulman, 1992). A person’s ability to change and adapt will depend on how strong their beliefs (schemas) were prior to the change. In addition, how this cognitive process occurs in an individual will dictate how well they adapt to the change (Janoff-Bulman, 1992). In looking at change as a trauma, we can associate individual’s responses to organisation change in a similar fashion as our brethren scholars do in the field of psychology. (Carver, 1998). A debate exists over the reactions that individual employees have towards change. While there has been a long tradition of researchers who argue that employees tend to resist organisational change in general (e.g. Judson 1991; Odiorne 1981; Strebel 1996), Dent and Goldberg (1999) argue that the term ‘resistance’ should be removed from the literature as it does not reflect the complex interactions that occur during change. Piderit (2000) takes a more conciliatory view suggesting that the ambivalence that employees feel towards change does not always produce resistance, but generally produces confusion. Regardless of what term is used, there is a wealth of literature that shows that employee ambivalence to management change initiatives is often linked to dysfunctional conflict during organizational change and associated with negative outcomes such as job dissatisfaction and expressed grievances (Kirkman, Jones & Shapiro 2000). Employees who are expending their energy on these types of reactions to change have less energy for participating or contributing to that change. Therefore, identifying factors that moderate this change resistance would be beneficial to both the individuals involved in the change process and the organisation. Examining organisational behaviour, researchers have identified change as having the potential to elicit a broad range of

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emotion whether the transformation is a major restructure or minor re-organisation (Mossholder et al., 2000). Organisational Change and Dynamics of Employee Psychology According to previous researches, redundancy affects survivors’ emotions, attitudes and behaviours (Worrall et al., 1999). The emotions synonymous with grieving, such as anger, anxiety and fear have been noted alongside decreased motivation, trust in the management and levels of organisation commitment in subsequent jobs (Worrall et al., 1999). However, Reilly et al (Reilly et al., 1993) suggested the individual becomes more loyal to their own personal development rather than to the organisation itself. It perhaps explains the origin of the concept “manager- as- mercenary” that has begun to appear in literature (Worrall et al., 1999). It has been found that all forms of organisational change have reduced managers' sense of loyalty, motivation, morale and job security with the impact on morale and sense of job security having been more pronounced than on loyalty and motivation. There is strong evidence that the perceived impact of change generally is to cause the attrition of organisations’ skills and knowledge bases: this is somewhat paradoxical given the recent emphasis on knowledge management and ‘the learning organisation’ in current management discourse. Different forms of change have impacted on managers' perceptions of their organisation as a place to work. While 47 per cent of managers in ‘no change organisations’ have reported increased job fragmentation, this is much lower than in those organisations where there has been some form of change and substantially lower than in those organisations where redundancy without delayering has been used. Speed decision making in post-redundancy organisational settings has been adversely affected and we suggest that this has been brought about by an increase in managers’ role overload, an increase in spans of control and an increase in task fragmentation among surviving managers. These issues raise concern for the management of post-redundancy survivors in terms of rebuilding their commitment, re-establishing their perception that the organisation has some commitment to them, redeveloping their sense of job security and rekindling their sense of identification with the newly downsized and restructured organisation. The case study participant company is an international blue-chip manufacturing company based in the UK, with 35,000 employees around the world. This company has a very complex structure, containing four core businesses, each supported by an operational unit. Moreover, under the operational unit, there are seven operational subunits spread around the world; five of which are located in the UK. This case study focus on one of the subunits, involved with around 1500 full time employees and nearly 100 temporary contractors. Despite our being able to access more than one subunit in this manufacturing

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company, we take just one specific subunit as our research focus group in order to narrow down uncertain variables. Interviews were conducted in a semi-structured style, surrounding the restructuring event and its process when the company adopted the activity three years ago. Interviewees were chosen via the researcher’s point of contact, who was asked to provide a list form a range of functions, locations and viewpoints. The business is dominated by shop floor workers which, in general is labelled as a blue-collar group. In addition, the majority of people working on the shop floor are male, leading to a higher proportion of male interview participants. There are fifteen interviews involved at this stage and each interview lasted 1.5-2 hours. Interviews covered a wide range of employee discipline, from professional engineers to manufacturing shop floor, from human resources officers to plant leaders, from managers to trade union representatives. There are six themes summarised from this rich interview resources. These six characters of Survivor Syndrome play a close “cause and effect” relationship to each other. Hence, six characters can be treated as gear wheel shape with the same operating function Six Characters of the Survivor Syndrome Model

Numerous issues have been discussed and investigated concerning Survivor Syndrome. There are various psychological themes arising from the organisational change as shown by numerous research studies. In the last decade, more and more organisational restructuring is involved throughout business activities. A Research spotlight would seem

Survivor

Syndrome

Flexibility

Management

Morale Relationship

Trust

Communication

Survivor

Syndrome

Flexibility

Management

Morale Relationship

Trust

Communication

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too focus on the most efficient and practical strategy for the business model and the potential consequences of it. Perhaps we can explain it as a general global phenomenon, as management analysts relate it to the bottom line of organisational priorities (Neuman and Baron, 1997). Despite research in this area, researches mainly focus on solutions to overcome these effects. Moreover, research emphasise a need to change the career plans on the management level. Throughout the research literature, observations have been made upon those impacts in the form of individual features, for instance depression, unrest, upset, and low trust. Comparison of literature to this report will provide a comprehensive framework of survivor syndrome consisting of implicit and explicit psychological perspectives. Themes can be explained by a matrix system which composes two dimensions, attitudinal and behavioural. Certainly, some characters overlap between behavioural and attitudinal. In the attitudinal aspect, there are trust and redundancy/ Dismissal process themes; morale is classified in the behavioural aspect. Flexibility, communication and relationship are revealed in both attitudinal and behavioural aspects. Without doubt, it is very subjective and viewed on a personal basis to approach the categorising of six characters into two aspects. There can always be arguments on whether this character belongs to a certain aspect or not. Characters are classified relative to results from interview data. Attitudinal and Behavioural perspectives of Survivor Syndrome

Workforce and morale has gradually changed throughout time, it is an obscure, indistinct and abstract change. Within the interview data we have gathered, it is possible to give a rough picture of this change. Some research studies have suggested that business downsizing often fails because broad-based personnel reductions inadvertently cause dramatic changes in the deep-seated, informal organisational structure when only

Attitudinal Behavioural

1. Flexibility 2. Communication 3. Trust 4. Relationship 5. Morale 6. Management

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incremental changes were intended (Fisher and White, 2000). Usually there are more impacts on informal structure by business downsizing than a restructuring programme, as it does not necessarily involve redundancy. During a redundancy selection process, serious tension was noted in the workplace. In the article “Aggression in the Workplace”, Neuman and Baron (1997) indicates that the American workplace has been challenged by intense global competition, rapid technological advances, volatile markets, and shrinking profit margins. Our case study company is UK based and also faces the same challenges as describe above. There was a redundancy decision responding to those changes. Increased stress and aggression behaviours are especially evident at the workplace during processes of change. Our interview data shows there is even verbal abuse in some cases, during a redundancy selection process, similar to Buss’s (1961) workplace aggression category of active and direct verbal abuse. In our interview there were also some instances of bullying in different groups, found during the integration of two workforces, new incoming staff would be bulled at the new plant by the old staff. Within the workforce, there were instances where younger people bully older more experienced staff. Young staff would believe older stuff would think old staff would receive a larger pay off once they stand for voluntary severance; in contrast, themselves who would not benefit from the voluntary scheme. An intermediate supervisor gave the observation:

…younger people thought it should be the older people gone, why don’t they just go… if they only have two more years to go, why don’t they just go now and save the jobs..…(15, 18: 7658-7659) These are rare cases during a redundancy event, but can seriously contribute to the development of tension in the workplace. Some interview data shows a lack of harmony since redundancy took place and shows no signs of recovery. There is an interesting phenomenon revealed at the workplace, absence, which dropped during the period when redundancy decisions were made. An intermediate management described: … after we have got rid of everybody…and everybody understood what was in the matrix, what we involved in it, then absence just went down…and it is now just starting to go back again because people think, well, we know what is going on, we know we are going to be safe now…(15, 21:7723-7725)

So absence reduced because of fear of job fears. This is not necessarily a positive finding as attendance motivated by fear, may manifest as lack of trust and loyalty later. Despite the event finishing and everybody returning to their jobs, there remained background comments and views. Most issues discussed would be whether they think the company chose the correct candidate to leave; if the whole process was done “fairly”; or if anyone

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had special treatment. In fact, not only shop floor staff has doubts about some issues, some management level staff also had suspicions. One concern is how to rebuild job security, as literature suggests survivor syndrome is caused by a lack of such a factor (Sahdev, 2004). How much can be learned from the private sector? Golembiewski, Proehl and Sink (1982) found that public sector interventions displayed a pattern of results very similar to private sector programmes (84% positive in public sector versus 89% positive in private sector organisations). Robertson and Seneviratne (1995) studied organisational outcomes in terms of work setting, individual behaviour and organisational performance, and concluded that there were no overall significant differences between public and private sectors regarding the amount of change induced by the 47 planned change interventions they studied. These findings should be interpreted with care. Change in public sector organisations, and particularly in those populated by influential professional groups, is beset by complexity of a different order from that in more hierarchical organisations. Success is likely to depend as much on the quality of implementation, on the sensitivity to different points of view and on the degree of support from influential organisation members as on the soundness of the principles of the change approach adopted. Much of the evidence from the manufacturing sector demonstrates that top management involvement is critical to success; however, in translating these findings to the health care setting we must remember the importance of opinion-formers within the professions who may not see themselves as top management. The scale of change is another important consideration when drawing lessons from other sectors. Small, focused interventions may have an equal potential for success in most contexts while more ambitious change initiatives are challenged, diverted and deflected by the inherent complexity, traditions and power dynamics of public sector organisations. Methodology Research Design: The present research is a descriptive research. This is because the aim here is to describe an already existing phenomenon, that is, the impact that the process of organisational change has on the psychological aspect of the employees within that organisation. As descriptive research merely aims to explain the phenomenon that is already there, it has been used in the present research so that the relationship that exists between organisational change and the psychological aspects (viz. work motivation, adjustment and values) may be explored, explained and understood.

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Sampling: Sample size is 50. In the suggested sample size all the respondents are selected from the companies where an organisational change of a very drastic and apparent nature has occurred in the recent past. The organisation is a well-known entity and a Public Sector Undertaking. It employs people from very diverse backgrounds which have indeed helped in enhancing the nature of the research. All the respondents are working at the middle management level in the selected organisation. Both male and female respondents have been included in the sample. A large sample size has been taken so that appropriate statistical tools may be used and conclusive inferences may be drawn Sampling Techniques: Purposive Sampling was used as sampling technique. Due to the nature of the research done and the high level of cooperation that is needed from the selected organisation for the success of the data collection procedure it is feasible to have a convenience and purposive sampling. So that only those respondents who have willingly agreed to participate and cooperate in the research are selected in the sample. Tools for Data Collection: The questionnaires being used have been developed by the researcher for the exclusive purpose of being used in the present research. These questionnaires have been developed keeping in mind a very specific aim and will enable the researcher to address the research questions directly. These tools have closed ended questions so that the findings that are obtained are more quantitative in nature and can yield more concrete and reliable results. The quantification of findings also makes it easier to carry out the appropriate statistical tools. Work Motivation Questionnaire – This questionnaire, developed by the researcher, measures the level of work motivation in the employees of an organisation, which has recently undergone a change process. Work motivation may be defined as the internal or external driving force that compels an individual to perform well in an organisation.

This questionnaire is based on the theory of work motivation put forth by McClelland (1953). According to this theory there are three basic needs or motives that govern an individual’s level of work motivation these needs are need for power, need for achievement and the need for affiliation. The questionnaire seeks to measure these aspects using 17 questions which are to be rated to a 5 point, Likert type scale. The respondent is merely required to tick the most applicable option i.e. strongly agree, agree, neutral, disagree and strongly disagree, in the response matrix provided adjacent to the questions. For scoring the rating given by the respondents to all the components were summed up category wise. The range of scores is, 6 to 30 for achievement, 6 to 30 for affiliation and 5 to 25 for power. After obtaining the separate scores for each of the sub categories, a

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grand total was done which reflected the overall work motivation of the individual respondent. The total score ranges from 17 to 85. Work Value Questionnaire – The researcher developed a questionnaire to assess and measure the work values of an individual employed in an organisation which has recently undergone drastic organisational change. Work values of an employee define the aspects of the outcome of the job that the individual desires the most. It is what a person wants from his job and is his reason for working apart from the payment of course. The sub scales that have been included in this questionnaire are a result of extensive research and study of secondary data available on the topic. The value categories that have been included are achievement, altruism, autonomy, comfort safety and status. Each of these values form an integral part of the value system of an employee in an organisation and are measured through 20 questions which are to be rated from 1 to 5 depending on what the respondents think of each statement. The response categories to choose from are strongly agree, agree, neutral, disagree and strongly disagree.

The scoring is done as per the weight provided to each of the response categories i.e. 1 for strongly disagree, 2 for disagree, 3 for neutral, 4 for agree and 5 for strongly agree. The scores may range from 2 to 10 for achievement, 6 to 30 for comfort, 4 to 20 for status, 3 to 15 for altruism, 2 to 10 for safety and 3 to 15 for autonomy. The total score may range from 20 to 100 and reflects and gives a view of total value preference of the respondents.

Work Adjustment Questionnaire – The Work Adjustment Questionnaire, also developed by the researcher with an aim of assessing the level of adjustments made by the respondents in order to come to term with the change that their organisation has undergone. Here one can measure both the personal and professional adjustments that have been made by the employees.

This questionnaire assesses an individual in three domains of organisational adjustment viz. work attitude, professional skills and work related social skills. As evident by the thorough research of the available secondary data these sub scales will provide a comprehensive picture of the adjustment pattern of an individual. The questionnaire has 18 questions in all and each sub category has 6 questions each.

The scoring of the questionnaire is done on the basis of degree of agreement of a respondent with the presented statements. The response categories here are totally agree, agree, neutral, disagree, totally disagree and earn the respondent 5, 4, 3, 2, and 1 score respectively. In all the sub categories score ranges from 6 to 30 while the total scores may be from 18 to 90.

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Procedure: The said research was conducted with an aim to assess the psychological correlates of organisational change on the employees of the organisation which has undergone an evident organisational change in the recent past. The psychological aspects under study were work motivation, values and the level of adjustment. The first step was to gain some basic knowledge about the topic understudy and look into the work already done in this field in the past. For this purpose journals and articles on the internet were thoroughly researched. And magazines and newsletters also came in handy when the theoretical foundations were being laid. This formed a base on which the research could be built upon and helped develop a strong theoretical backup for the study. The next step was to select the company which had undergone drastic organisational make over for the purpose of studying it and making it a part of the research. The respondents were selected from the company on the basis of their willingness to participate in the research. The selected respondents were then contacted at a time of their convenience and the questionnaires were administered on them one by one individually. Those who could not be contacted personally were emailed the questionnaires with the relevant instructions. The respondents then mailed back the filled up questionnaires to the researcher. The information provided by the respondents in the questionnaires was tabulated and scored as per the specifications. This has resulted in a set of raw data which has formed the basis of the development of the research and the subsequent findings after proper statistical techniques were administered on them. The questionnaires and their respective tabulated scores have been presented in the appendices. Statistical Analysis:

 The data obtained after scoring each of the questionnaires was processed and analysed with the help of the SPSS software.

 Various tools of descriptive statistics like mean and standard deviation were used. Pearson’s coefficient of correlation among the various dimensions was also calculated to find out the statistically significant trends.

 The analysed data was then used to draw meaningful inferences and authenticate the findings.

Discussion The research displayed above was carried out keeping the following aims in mind; to study the level of professional adjustment of employees after a change event, to study the personal adjustments that the employees make to fit into their organisations after change has occurred, to study the level of motivation in employees after a change event with respect to need for power, affiliation and achievement, and to study the job related value system in-place in the employees after the change process.

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For this purpose a sample of 50 employees was selected from an organization that had undergone very drastic organizational change in the recent past. These respondents were then assessed on the three psychological dimensions viz. adjustment, motivation and values, using three questionnaires developed by the researcher specifically for this purpose. The results obtained through the questionnaires and the in-depth analysis thereof has revealed significant findings. One of the major findings to have emerged from the analysis of the data is that the respondents have shown a tendency to give mostly neutral responses as the means calculated for the data hover close to the range of 2.5 to 3.5. This range of responses lies in the “disagree” to the “agree” categories with a very heavy inclination towards the neutral response region. The tendency of the respondents to give more neutral replies may be attributed to the fact that they wanted to avoid being too judgmental about their organization and the change event. Moreover they may be hesitant in sharing their experiences which they had at psychological level during the change event. The true feelings may also be hidden by the employees as they would not want to talk about their organization in a negative light in front of a stranger. Another factor that may add to it is social desirability or the feeling that the respondents should give the response that is “expected” from them rather than the true thing that they feel in order to maintain a certain image about themselves in front of others. It may also be called a face activity. They want to project a persona which cannot be questioned and seems “good” to others. The results presented above suggest that the respondents have given such responses that on may say that they do not really care about autonomy and safety when it comes to organizational values. This is to say that these dimensions are not contributing significantly to the work value structure of the respondents. These two values are of relatively low importance to them. This unique finding may be attributed to that fact that the company chosen for the study is a Government of India Undertaking. This is a public sector undertaking a more relaxed and almost complacent atmosphere. People don’t fear an entity being merged into them. Work safety in terms getting regular promotions and salary and not fearing that they would be fired is not important to them as being in a government enterprise the jobs are very secure and the respondents don’t need to fear these aspects as they are governed by a pre-determined set of rules regulations and norms set aside by the government of India and not by the performance or the commitment towards the job. Same is the case of the autonomy dimension because in a government organization employees do not have a lot of autonomy and they work by the rules set in the book. Autonomy is not important as a value as people here are used to working in a hierarchical

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and closed system where they have no or little say. Over the years they have gotten used to this style of working and don’t miss any autonomy. It is the case with both the merged organizations. It may also be said that these employees may become averse to autonomy and may actually resist it so as to avoid any direct responsibility of work on their heads. Thus apart from the two values of safety and autonomy the other values which are achievement, comfort, status, altruism, are very important in the respondents’ value structure and play a major role in the employees expectation from the job and their adjustment thereof after the change has been implemented i.e. old organizations have merged to formed a new organisation. These values have been given more weight by the respondents as far as their post organizational merger values systems are concerned. An understanding of the value system of the employees will enable us to help him adapt to an organization which has changed so drastically. Adaptation may be eased by focusing on the values that are more important for him and especially help him cope in those areas so that he feels at ease and blends well in the new organization. Paying more attention to the areas that respondent’s value will bring out the best in them. The data obtained also suggests dimensions like work attitude, professional skills and work related social behaviour are positive determinants of work adjustment. This goes to say that in order to adjust well to the new organization and function properly in it post change, one needs to develop the right kind of professional skills in order to do well in the new scenario and enhance performance in a new role that has been assigned to him in the new organizational entity. This is necessary as organizational change may define new roles and responsibilities for every one and development of new skills is imperative for meeting performance standards. Another important factor in adjustment to the new work atmosphere in the organization is the work attitude. The employees need to maintain a positive attitude towards the change and new things that have come with it like a new structure and jobs. With the right kind of attitude an employee would be able to appraise the change better and thus would be better equipped to deal with it. Attitude also determines how one perceives the change and how much effort one makes to adapt to it. Only people who are able to see the changes that are happening in a good and bright light are able to adapt to them and adjust to them and not merely try to live with it. At work every one forms deep social bonds with the coworkers. Everyone has a relationship. Meaningful and symbiotic relationships between coworkers ensures smooth running of the organistaion. When mergers happen lot of people who are totally unrelated and unknown come together and are made to work in cooperation with each other. This may prove to be a tough task as people need to foster relations that are

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beneficial for the organizational development. Developing good personal relationships with coworkers is very important for the individual’s adjustment to organizational change. No individual can perform well in an organistion if there is friction in the relationships with the other employees. In an organisation adjustment need to be made at two levels professional and personal the first two dimensions i.e. work attitudes and professional skills are indicative of professional adjustment while the present dimension which is work related social behaviour depicts the personal adjustments that are made by the employees in order to adjust to the new and changed organization. This adjustment is not to be made with the organization and it non-human policies and procedures but it is to be made with living breathing individuals who respond back and are tougher to deal with as they have their own set of values, beliefs and attitudes. Work motivation is measured by three variables as per the three factor theory given by David McClelland. These variables are need for power, need for achievement and need for affiliation. These are the three are the major motivational forces that operate in the organizational setting. During merger a lot of people fear that the power they had before would be lost due to the new equations that have been formed in the organization due to the change in hierarchies and roles that has been brought about. Power motive is the most important motive as it determines the proper function of both formal and informal organization. In the study it has been found that the respondents feel that if the need for power in the changed organization is satisfied. It is all the more important in a government sector enterprise as the power there is determined by the position that a person holds, but with change these positions are altered and new rules of power are made. Need for affiliation is another dimension which will improve work motivation and is highly correlated with it. This need is closely related to the work related social behaviour dimension of the work adjustment scale. This is to imply that an individual who has the high motive to form close and meaningful personal relationships in the organizations are highly motivated and also well-adjusted in their organizations. These two dimensions provide a comprehensive picture of role that relationship among employees play in making sure that the change is well adapted to at least at a personal level. It may also be inferred that personal relationships and adaptation to the same are more important to better implementation of organsiational change as a whole. This is because a personally satisfied and content person would be more likely to better adapted, professionally. Such a person is also highly motivated to understand the change process better and work for its success as he is actually happy and content at heart. And a person who is at peace with himself is also better equipped to handle any professional ups and downs.

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The most important and significant findings of the research are that the employee adjustment and values are negatively correlated which means that both of them move in the opposite direction. This is to say that one will increase if the other decreases and vice versa. This may be due to the fact that an employee who has a higher sense of his values and sticks by them all through may be at times be seen like a rigid person who in not likely to adjust well in the organization according to the organizational change. Therefore it is imperative that an individual’s work values change with the changing organizational scenario, in order for him to work well within the changed organization. Any rigidity is never appreciated in the organizational setup and would lead to major adaptation problems and may even cause stress for the employee. For the employer such a situation may translate into attrition or absenteeism. The dimensions of motivation and adjustment are highly, positively correlated. This implies that an increase in one dimension will lead to an increase in the other and a decrease will lead to a decrease. It may thus be inferred that the employees who are highly motivated with respect to the organizational change are also likely to be better adjusted to the organizational change. High motivation in employees will prompt them to make more adjustment towards the changed organization. Also better adjustment will lead to happy employees who are again highly motivated. So this works like a cycle where high motivation prompts better adjustment and good adjustment leads to high motivation in the employees. Limitations Though the researcher has made all the possible efforts to develop a comprehensive report encompassing all the aspects of the concepts under study; However due to certain constraints like time and money the report has certain limitations, which are as follows:

 The scope of the study could be broadened and the psychological dynamics of change can be better understood if other dimensions related to the human psyche are incorporated. This will enable a deeper understanding of the human psychology and organizational change.

 The present study has been conducted on only one organization due to time constraints and research feasibility. But it would be better to involve more organizations in the research so that a comparative analysis may be done and more interesting findings and be deduced.

 A larger sample size of the organization would have provided a more comprehensive picture of the organization as a whole. This would have made the findings more conclusive and the euthenticity and replicability of the report would have been enhanced. Also the correlations among different dimensions would come out to be better.

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 The present research is only quantitative in nature; however including some qualitative data about each of the respondents would have given a deeper insight into the psyche of the respondents and thus given more detailed and descriptive findings.

 An equal number of respondents form both the merged and the merging organization would have facilitated comparison and more deductive findings.

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