6.1: The Change Process
As John Lechleiter assumes the CEO’s post at Eli Lily, then he sent individual gifts to his every senior executive. In between 2010 & the end of 2016, he stands to a loose of dollar 10 billion of annual revenue as a patent of 3 of the key drugs that expire. No need to say that the organization had to do through several changes because it has picked up pace on drugs development. The mangers there are doing what they should do at that period- they are implementing changes!
Apart from the changes implementation the manager’s job is far easier. Then planning will become very simple as there will be no big difference in between today and tomorrow. The issue about effective design of the organization will be solved easily because there will be no uncertainties of tomorrow and hence there will be no need of redesigning. On the same way decision making will be simpler because every outcome that’s going to come will be similar to each other and hence future predicted decisions can be made. But the problem is this does not happen in real life. Organizations are subjected to changes of situation and mangers have to handle it properly. The organizations are subject to change because of the influence of both external & internal factors that forces the changes. Check Exhibit 6-1. How do the managers react to changes when they recognize them at an early stage? What do they do?
Two Basic Views of Changes
There 2 metaphors that can be used to explain this change process. 1st is a metaphor of a large ship which is crossing a silent sea. Here the ship is the organization. Here the ship’s Captain is fully confident about their destination because they have already made this trip before. Change occurs in form of a disastrous storm, which is distraction to the calm & predictable trip.
In this metaphor the changes is the distraction made by the storm in a already predicted trip that distracts the normal journey. The next metaphor is compared the ship with a little raft which is navigating a river with non interrupted water rapids. In the raft there are ½ dozen people who did not have worked before. These people have no idea about the river, no idea about their destination, and who have no idea about the circumstances that can come at the dark night. In this white water metaphor the changes are quiet expected and normal and management of these are not that difficult. The two metaphors are completely different approaches. Let us have a clear view of these metaphors used.
THE SILENT WATER METAPHOR
The silent water metaphor at first clearly describes the real situations faced by the managers. It is beautifully discussed in the Kurt Lewin’s 3 step changing process. Check Exhibit 6-2.
Acc, to Lewin, every successful changes can be easily planned & requires unfreezing with status quo, that is changing to new state & then refreezing for making the changes permanent. This is considered as a state of equilibrium. For moving away from this state, unfreezing is required. Unfreezing is the thought of preparation for the changes. This is to be done by the increasing of driving forces that are forces which pushes for changes and by decreasing restraining forces that are forces that can resist the changes or may ne by combining the 2 approaches.
As the freezing is completed the change which was to occur can become implemented. Though only by introducing the changes always does not mean that will hold. This new situation needed to be refrozened so that it is sustained over the time. Until this last stage is completed there is a huge chance where the employees can turn back to the state of equilibrium. Hence old ways of taking decisions and doing things stars again. The main objective of this refreezing is stabilizing the present new situation.
The 3 step process is such as it treats changes as a runaway from the firm’s present state of equilibrium. It is the calm water scenario where this occasional storm is the changing to have deal with disruptions. As this disruption is taken care, the ship runs with this new change caused after the storm. However this situation is not the one which managers in today’s world face often.
Susan Whiting is CEO of Nielsen Media Research, the organization which is best known for the television ratings that are used to the determine how much amount the advertisers have to pay for their TV commercials. Now the media research is not at same condition what it was used to be, due to the use of internet, technologies, i Pods, cell phones, digital videos, recorders & different other new technologies data collection have become more challenging. With the change in technologies the industry working also changes. This is what change is meant in the 2nd metaphor used that is the White- Water Rapid metaphor. It is also consistent that with the world that is increasingly dominated through the technologies.
Information & Ideas
To get an experience of what can be the difficulties and situations in managing the changes, just imagine that you are attending a university that has certain rules- Courses varies in length. You don’t have any idea about how long are the courses. The period may vary from 2 weeks to 17 weeks. Also the courses can end at any time without any prior information. Not only that the length of each class might does not have any particular duration, it can end at any time it wants to. The duration of the classes may vary from 29 minutes to 3 hours. Isn’t that challenging enough? The schedule of next class is declared by the instructor in each class so no scope of missing out. The examinations are declared openly and they will ask you to give test anytime they want. Now to succeed in such an environment you will have to make yourself prepared for all situations that might come. Students who always remain unprepared or rather remain structured & cannot handle changes will have to suffer a lot.
Today every manager are facing this same situation what a student in such an environment have to face. The stability of such calm water is not more applicable for today’s business. The distractions that a business has to face are not occasional and continuous process that will again return to the calm ambience after the distractions. Many managers cannot return to the calmness as the changes keep on going and ups and downs are a regular process. Susan Whiting is one such individual who have to face this on a regular basis.
Is this white water rapid an exaggeration? No it is not. This chaos and turmoil is not only faced in high industrial firms but also in small businesses. This is a common phenomenon phased by the companies these days. For instance, Electrolux, a Swedish home appliances company, people might think that home appliances companies remain stress free and are not subjected to sudden changes and chaos but this is not the actual case. Firstly they have the challenge to produce items with present technologies and not with old ones due to the increasing need of the customers. Again there is the threat from cheaper alternatives that are sold in the market.
Electrolux also gets intense completion in the USA market which is the market of its 40 % sales. As 80 % of the workers belong to Sweden, firms certainly have to face expectations on the basis of how they treats their employees. Straberg understood that his firm needs certain changes to survive & prosper in the market. He then shifted production to a lower-cost facility in Easter Europe and Asia. The company had interviews with 160000 of its customers to get a better view of the market and expectations. Considering the demands of the customers worldwide, a group of chief employees then conducted a meeting in Stockholm where they discussed about the changes of technologies that their products need at most. To make this new range of products, Straberg eliminated structural divisions in between departments. The designers and engineers then worked together for manufacturing new products with new ideas. To resist such white water rapid environment Electrolux had to make those changes.
In today’s world this environment is quiet common and mangers have to work more efficiently to overcome such continuously changing situations. Organizations have to be prepared about what is happening each and every moment and work according to that situation. If this is not followed properly the organization might have to face several risks. Managers are hence suggested to have good presence of mind to overcome such distractions and know what is necessary to do at that period of distraction. If this is not followed properly the firm is never going to survive & prosper in today’s competitive market.
Links of Previous Main Topic:-
- management and organizations a managers dilemma
- Understanding managements context constraints and challenges
- Managing in a global environment
- Managing diversity
- What is social responsibility
- Managing change and innovation
- The change process
Links of Next Fundamentals of Management Topics:-
- Managing resistance to change
- Contemporary issues in managing changes
- Stimulating innovations
- Case application 1 too big to change
- Case application 2 stress kills
- The summary of the chapter by learning outcomes
- Preparing for my career managing change and innovation
- Managers as decision makers
- Foundations of planning
- Strategic management
- Basic organizational design
- Adaptive organizational design