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The Nature
of Change
LEARNING OUTCOMES
By the end of this topic, you should be able to:
1.
2.
3.
4.
5.
X INTRODUCTION
This topic provides a basic understanding of organisational change, which refers
to the modification of the existing organisation to enhance its effectiveness and
efficiency. It introduces the basic concepts of organisational change and describes
the various forms of change, the sources of change (internal and external) and the
focus of change (people, structure and technology).
In todays complex business environment, the magnitude, speed and impact of
change on organisations are increasing. Organisations are confronted almost
daily with the need for change. Over the last few decades, many new products
and services have been introduced into the market; local markets have become
global markets; protected industries have been opened up to competition; and
public institutions have either been privatised or found themselves adopting
more market-oriented practices. In other words, change has become both
pervasive and prevalent.
TOPIC 1
1.1
MAGNITUDE OF CHANGE
The nature and pace of change can vary substantially from one organisation to
another. Change experienced by organisations can be distinguished by their scale
and importance. Generally, the change continuum ranges from incremental
changes which involve fine-tuning the organisation to quantum changes which
require the transformation of the organisation (Burnes, 2004). The incremental
perspective views change as being a process whereby individual organisational
subunits deal with changes incrementally and separately with one problem and
one goal at a time. On the other hand, the quantum or transformation
perspective, sees change as radical and unpredictable due to the complex
environment in which the organisation is operating. Figure 1.1 presents the
change spectrum where change ranges from small-scale and incremental to largescale and transformational.
TOPIC 1
Table 1.1 presents the differences between incremental change and quantum
change.
Table 1.1: Incremental vs Quantum Change
Incremental Change
Quantum Change
x Small scale.
x Large scale.
x Operational changes.
x Strategic changes.
Examples:
x Downsizing.
ACTIVITY 1.1
Describe the changes made in your work organisation. Then, identify
whether they are incremental changes or quantum/tranformational
changes.
1.2
TOPIC 1
Changes can be triggered either by internal or external events. Internal forces for
change are those factors originating from the organisation that give rise to
changes (Paton & McCalman, 2008). There are a large number of such factors.
Some examples are:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
Organisational growth;
(l)
External forces for change are generated from the outside environment. External
changes that organisations are currently facing include (Paton & McCalman,
2008) the following:
(a)
Government Legislation
These are governmental interventions in terms of changes and
implementation of government laws and regulations for example,
strengthening health-related legislation, new systems of handling foreign
workers, emission control legislation, carbon free policy, new tax laws and
tightening international trade.
TOPIC 1
(b)
(c)
Globalisation
The integrated internationalisation of markets has changed the way modern
corporations do business nowadays. Jobs, knowledge and capital can now
be channeled across borders with far greater speed. The worldwide
availability of the Internet and supply-chain logistics enable companies to
locate and work with multiple partners to serve any market anywhere, thus
venturing into a global market instead of national markets. Business
organisations must change to keep up with global developments to position
themselves for sustainable competitive advantage.
(d)
(e)
(f)
(g)
TOPIC 1
The manner in which a trigger or driver for change impacts upon a situation, to a
certain extent, depends on its source, nature and magnitude. Internally generated
change is likely to be managed far more proactively and effectively due to prior
knowledge and understanding. Table 1.2 highlights the differences between
internally and externally generated change.
Table 1.2: Differences between Internal and External Sources of Change
Internally Generated Change
x Proactive stance;
x Reactive response;
x Positive feelings;
x Negative feelings;
x Greater certainty;
x Greater uncertainty;
x Greater control;
x Reduced control;
SELF-CHECK 1.1
Give and explain two examples of internal sources of change and two
examples of external sources of change in your work organisation.
TOPIC 1
ACTIVITY 1.2
We experience change throughout our lives. List three significant triggers
of change, identify their sources and rank your feeling of control in
coping with each change.
Trigger
Source
(Internal/External)
Ranking
(5 High Level of Control;
1 Low Level of Control)
1.
2.
3.
1.3
People Change
Emphasises the improvement of job performance by changing certain
aspects of organisation members such as their work attitudes and work
behaviour. Managers may attempt to make this kind of change when
human resources are shown to be the major cause of organisational
ineffectiveness.
(b)
Structural Change
Helps increase organisational effectiveness by changing organisational
controls which influence organisation members in performing their jobs.
Managers may choose to make structural changes within an organisation if
they believe that the present structure impedes organisational effectiveness
and efficiency.
(c)
TOPIC 1
Technological Change
Focuses on modifying the level of technology in both the management and
production systems. Managers can change the technology used to convert
input into output to increase production efficiency. Today, technological
changes usually involve the introduction of new machinery, equipment,
tools or methods. For instance, the evolution in ICT has given birth to
online businesses.
What It Involves
x People factors are the competencies and all other characteristics
of human resources within the organisation.
x Changes in employee attitudes, expectations, perceptions, skills
or behaviour.
x Examples:
Training given to employees to learn new computer skills.
Stress management programmes to enhance employees
welfare.
Structure
TOPIC 1
Technology
10 X
TOPIC 1
ACTIVITY 1.3
Identify what areas need to be changed at your workplace. Then, classify
whether the change is people, structural or technological change. Explain
your answer.
1.4
(b)
(c)
(d)
(e)
(f)
(g)
TOPIC 1
W 11
SELF-CHECK 1.2
Describe how each of the following factors has impact on your
organisation:
(a)
The Internet;
(b)
(c)
1.5
(b)
(c)
(d)
(e)
(f)
(g)
12 X
TOPIC 1
(b)
(c)
Organisational learning;
(d)
(e)
Competitiveness;
(f)
High-performing organisations;
(g)
(h)
Ultimate survival.
SELF-CHECK 1.3
Why is change important for your organisation? Give an example to
support your answer.
Organisations come in all shapes and sizes and offer a wide variety of
products and services, but also face a host of challenges. Perhaps the only
factor common to all organisations is change.
TOPIC 1
W 13
Forces in the external environment are the major cause for change in
organisations.
People change
Incremental change
Quantum/Transformational change
Structural change
Organisational change
Technological change
Burnes, B. (2004). Managing change (4th ed.). Harlow, England: Prentice Hall
Financial Times.
Certo, S. C., & Certo, S. T. (2009). Modern management: Concepts and skills (11th
ed.). Upper Saddle River, NJ: Merrill Prentice Hall.
Paton, R. A., & McCalman, J. (2008). Change management: A guide to effective
implementation (3rd ed.). London: Sage Publications.
Robbins, S. P., & Coulter, M. (2009). Management (10th ed.). Upper Saddle River,
NJ: Merrill Prentice Hall.