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Change experience and employee reactions: developing capabilities for change

Inger G. Stensaker and Christine B. Meyer
Norwegian School of Economics and Business Administration, Bergen, Norway
Abstract
Purpose The purpose of this paper is to explore how experience with organizational change inuences employees reactions to change. While exposure to an increasingly frequent organizational change can lead to change fatigue and cynicism, it can also generate more positive reactions to change. The authors identify experience-based change capabilities and explore conditions for developing such capabilities. Design/methodology/approach The paper draws on qualitative interview data from two studies of reactions to planned change. The authors probe employees accounts of their reactions to change and show how they vary depending on employees level and type of experience. Findings The ndings suggest that experience provides opportunities for employees to develop their change capabilities, which leads to milder and more constructive reactions to subsequent change initiatives. However, negative experiences can lead to loyal behavior that is based on cynical attitudes. Research limitations/implications The ndings contribute by identifying experience-based capabilities among change recipients. The limitations of the study include the threat of self-selection as employees who remain in the organization may be more prone to loyal behavior. Practical implications When employees have extensive change experience, managers must adjust their way of thinking about change. Managers need to be alert to the prominence of more loyal behavior. They should also recognize their own role in generating positive process experience, which is a precondition for developing change capabilities at the employee level. Originality/value The study adds to the increasing focus on change recipient perspectives during change and shows how change capabilities can be developed among employees. Keywords Reactions to change, Change capabilities, Change experience, Organizational change, Change management, Employees attitudes Paper type Research paper

Personnel Review Vol. 41 No. 1, 2012 pp. 106-124 q Emerald Group Publishing Limited 0048-3486 DOI 10.1108/00483481211189974

Introduction The ability to manage complex and parallel changes (Pettigrew and Whipp, 1991) and the ability to predict and handle different responses to change among employees are key management challenges. An increasing pace of change is making employees more experienced with organizational change, yet little is known about how experience with change affects employees reactions to large-scale organizational change. A growing body of literature focuses on change recipients and the reactions to planned change by those who carry out organizational interventions initiated by others (Bartunek et al., 2006). However, although organizations frequently initiate new large-scale change projects, limited research exists regarding how reactions to change develop over time (Piderit, 2000) and the role that change experience plays. For instance, a key question is whether individuals with extensive change experience react similarly and follow the same patterns of reactions as those with little or no experience with organizational change.

In this study, we address the inuence of experience with previous organizational change on reactions to subsequent change initiatives. In particular, we are interested in examining whether individuals develop change capabilities or whether there is a link between exposure to repeated change processes and more negative outcomes. Previous literature has indicated that pursuing multiple change processes can create change fatigue (Abrahamson, 2000), cynicism (Reichers et al., 1997), or even burn-out (Lee and Ashforth, 1996). However, experience with multiple change processes can also provide an arena for learning, in which there is the potential to transfer experiences. The empirical evidence indicating that experience with change processes can lead to more positive reactions to change is limited (Thornhill and Saunders, 2003), and the ndings are inconclusive (Smollan, 2006). We examine the role of experience empirically based on inductive and comparative analyses of data from two studies which include a wide range of Scandinavian companies, some with change-experienced employees and others with employees who had less change experience. Our ndings suggest that there are indeed distinctive differences in general patterns of reactions among employees based on their level of experience with organizational change. Employees with limited change experience exhibit strong behavioral and emotional reactions, while employees with extensive change experience use less effort to resist change and show more loyal reactions to change. However, loyal behavior takes on two different forms, and only one of these provides opportunities for developing change capabilities. Illustrating and explaining different patterns of reactions as well as identifying potential change capabilities of employees who have extensive change experience constitute the main focus of our analyses. One of the main contributions of this study is the focus on change capabilities at the employee level. While there exists an extensive literature on change capabilities at the organizational level (Teece et al., 1997) and how rms can develop dynamic capabilities through learning and experience transfer (Zollo and Winter, 2002; Gavetti, 2005), few studies have focused on how capabilities for change are developed at the individual level. Studies that address change capabilities tend to focus primarily on managerial change capabilities (Lopez-Cabrales et al., 2006) while research on change capabilities at the change recipient level is virtually non-existent. This is unfortunate, given the increasing frequency of organizational change projects and hence the opportunities for learning from experience. This paper is organized as follows: rst, we present existing literature on reactions to change and discuss how learning from experience might inuence reactions to change. We then describe our methodological approach before the ndings are presented. In the ndings section, we rst briey present and describe reactions among employees with limited versus extensive change experience. Our primary focus however is to identify experience-based capabilities for change among change recipients and probe the conditions under which change capabilities are most likely developed. The paper concludes with implications and suggestions for future research. Theoretical background Reactions to change A large and fragmented body of research deals with how change recipients react and respond to change. According to Piderit (2000), reactions to change involve affective,

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cognitive, behavioral components; however, research on reactions to change seldom covers all three components. Some studies focus on employee attitudes towards change (Lines, 2004) while other studies predominantly map feelings (Perlman and Takacs, 1990), thoughts about change (Armenakis et al., 1993), or behavioral intentions. Studies that examine what employees actually do in terms of behavior tend to focus on resistance to change (Guth and MacMillan, 1986). Indeed, employee resistance has been documented as the most frequent problem encountered by management when implementing change (Bovey and Hede, 2001). It is often argued that resistance and reluctance to adapt to change are common reactions of humans in an organizational environment (Worrall et al., 2004) because change brings uncertainty and perceptions of uncertainty are detrimental to well-being (Elrod and Tippett, 2002). The emphasis within this literature has predominantly been on explaining reasons for resistance and ways of handling resistance (see for instance Guth and MacMillan, 1986). An important point made through the literature is that resistance must be handled differently depending on its underlying reason. While the research on resistance provides valuable insight and direction for managers who struggle with resistance, an overemphasis on negative reactions risks self-fullling prophecies. One recent study indicates that constructive input (voice) from employees was wrongfully perceived by management as resistance (Bryant, 2006). Studies on resistance have furthermore neglected to address how experience with change might inuence the level of resistance. Another stream of change studies has focused on developing typologies and categories of reactions to change (Mishra and Spreitzer, 1998; Bourantas and Nicandrou, 1998; Hirschman, 1970; Stensaker et al., 2002; Chreim, 2006). The categories of reactions typically differ along two dimensions: (1) active or passive reactions; and (2) constructive (likely to lead to implementation of change) or destructive (not likely to lead to implementation of change). For instance, Stensaker et al. (2002) present six categories of reactions: (1) taking charge means to take active initiative to push implementation of change further; (2) loyally implementing change means to make the suggested changes while also attending to daily operations; (3) BOHICA (Bend over, here it comes again) refers to distancing oneself from the change and doing a minimum of the suggested changes; (4) paralysis means not attending to change and not being able to attend to daily operations; (5) exiting the organization refers to voluntarily leaving the organization; and (6) sabotaging the change initiative, which is to actively resist change for instance by making fun of the change initiative, or the people who support or try to implement change. While these studies serve to extend more general categorizations such as exit, voice and loyalty, they do not specically address different dimensions of reactions (Chreim,

2006) is a notable exception), hence they fail to sufciently incorporate more ambiguous responses to change (Piderit, 2000). In addition, the categories appear rather static and have seldom been applied to understand or explain how reactions might shift over time or vary across different change efforts. Finally most of these studies which map different behavioral or attitudinal reactions have been tied to specic types of change: downsizing (Mishra and Spreitzer, 1998), acquisitions (Bourantas and Nicandrou, 1998), or change that was perceived as excessive (Stensaker et al., 2002), while a more general applicability has not been attempted. In summary, the literature on reactions to change has predominantly been concerned with identifying and explaining negative reactions to change that act as barriers to change implementation. Less is known about more supportive reactions among employees and differences in patterns of reactions over time. Below we discuss how experience might affect reactions. How experience affects reactions There is increasing evidence that employees react to change with cynicism. Organizational change cynicism has been dened as a complex attitude that includes cognitive, affective and behavioral aspects resulting in increased beliefs of unfairness, feeling of distrust and related actions about and against organizations (Bommer et al., 2005, p. 736). While some argue that cynicism is linked to personality disposition, Wanous et al. (2000) argue it is a learned response. Past failures in organizational change have been found to breed cynicism; this includes failure to keep people informed, not caring about employees and failure to try to understand employees point of view (Reichers et al., 1997; Wanous et al., 2000). On a similar note, research on survivors of change suggests that survivors often display less commitment and loyalty to the organization (Ebadan and Winstanley, 1997). Thornhill and Saunders (2003) found that those who felt negative about change were likely to be cynical about how they had been treated by management. An interesting nding from their study is that a number of employees reported positive affective reactions to change. These employees were more likely to feel they had been listened to and treated with dignity and respect. Overall, these studies suggest that as employees gain experience with change they draw on their previous experience to interpret subsequent changes (Randall and Procter, 2008). Employees learn from experience and can potentially develop change capabilities in two ways, either by: (1) transferring specic skills or knowledge; or (2) by process-based learning, which means absorbing and applying new knowledge more efciently (Schilling et al., 2003). We approach our study of experience-based capabilities in two steps. First we map the patterns of categories of reactions that are most common among experienced versus inexperienced change recipients. Similar to Chreim (2006) we focus on general experience with large-scale organizational change rather than a specic change situation. By experience we refer to more than one previous encounter with different types of large-scale change, for example mergers, acquisitions, restructuring or downsizing. We rst apply the categories developed by Stensaker et al. (2002) to identify different reactions. As many of the experienced change recipients were found to react with loyal behavior, but for different reasons, we develop this reaction further.

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The second step of our study involves identifying potential change capabilities. We base our understanding of employee change capabilities on the dictionary denition of capabilities as: the qualities, abilities or features that can be used or developed in the context of organizational change. Methodology Studying more general patterns of reactions required a need to incorporate various types of change and different organizational contexts. We therefore chose to rst conduct a multiple case study, which was later followed by an additional comparative case study. The two studies were consecutively designed to supply insights on change recipient reactions to change and how employees contribute (or not) to an organizations capacity to implement a multitude of planned changes. Although the design follows a replication logic, insights gained in the rst study contributed in focusing the subsequent study, both in terms of target organizations and the questions that were asked (Langley, 2009). The complete data set consists of 50 interviews at various organizational levels in ten Scandinavian companies. Sampling and interview questions were informed by a pilot study. The organizations and data collected are illustrated in Table I. A pilot study was rst conducted in an executive MBA program. A total of 30 topand middle managers worked in focus groups of four or ve participants. Their task was to describe and discuss, based on their personal experience with large-scale change, how they and others in their organization reacted to frequent organizational change. Insights from the pilot study lead us to believe that employee experience could be important for understanding reactions to change. We therefore attempted to select organizations which to various degrees had pursued frequent large-scale planned change. In our rst study, organizations within the nancial service industry were targeted. Since deregulation in the middle of 1980s it has been undergoing major changes with technological innovations, substantial downsizing, and a large number of mergers and acquisitions with following organizational restructuring. Four banking institutions (targeting change experienced employees) and four insurance companies (targeting less experienced employees) were sampled. We interviewed 22 organizational members at various levels in 2004/2005 asking both about reactions and different ways of managing change. An additional eight interviews were conducted in 2006 within two of the banks probing further employee reactions to change. A total of 30 interviews were thereby conducted in the rst study. In the second study we targeted other industries that had gone through dramatic changes within the last decade in order to compare reactions among change experienced employees across industries. 20 change recipients were interviewed: ten in a pharmaceutical company and ten in a postal services company. All interviews were semi-structured and lasted approximately 90 minutes. We used an interview guide that was based on the review of theory and the pilot study. Like previous research based on a series of studies, we attempted to develop cumulative insights which is facilitated by similar research questions (Lozeau et al., 2002), while at the same time taking advantage of the possibility to adjust the focus in the interviews as new insights emerged. The interviews were tape recorded and transcribed in full length with the exception of two interviews where respondents were reluctant to be recorded.

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Pilot Study A wide range of companies from various industries;, e.g. Oil and energy, telecommunications, health care, nancial services Focus group study of middle managers who participated in an executive MBA program Pharmaceutical industry: AstraZeneca Postal services industry: Posten

Study 1

Study 2

Total

Industry and rms

Type of study/data

Financial Services Sector. Four banks and four insurance companies: DnBNor, Handelsbanken, Sparebanken Vest, Nordea, TrygVesta, Vital Gjensidige, Storebrand In-depth interviews and analyses of how organizations can develop a capacity for change based on change management practices and reactions to change

2004 30 11 15

2004-2006 4 26

In-depth interviews and comparative analyses of reactions to change and the role of change experience in organizations that have been through mergers, restructuring and downsizing 2007 0 20 2 ( accounts from 18 experienced) 18

4 46 (30 pilot) 13 ( 18) 33

Timing Top managers Total number of change recipients Less experienced change recipients Experienced change recipients

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Table I. Data collection

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In identifying different reactions we draw primarily on the interview data from change recipients (middle management and employees). In order to determine their level of experience, we asked the respondents in both studies to rst describe which large-scale changes had been pursued in their organization within the past 10-15 years, and if and how these changes had affected their own work situation. Based on this, we were able to divide our respondents into experienced versus inexperienced change recipients. We also checked for tenure and potential experience respondents may have from previous employment in other organizations. Employees that had experienced more than one large-scale change process and had experience with different types of change processes were categorized as change experienced. As Table I shows, our nal material consisted of 33 accounts from experienced change recipients and 31 accounts of reactions from inexperienced change recipients. In the rst study, we allowed the respondents to speak freely about their own and their colleagues reactions to change; then we categorized their reactions using the typology developed by Stensaker et al. (2002). For example, statements that were in the rst round of coding categorized as loyal reactions included:
People are very loyal its a positive kind of loyalty and people are very good at adjusting (loyal reaction; later labelled acceptance). You just have to keep at it and do what you are supposed to be doing (loyal reaction; later labeled acceptance). . . .others distance themselves a bit and say that this is not our responsibility. We deal with whatever is decided you become more distanced. You provide your input into a black box and then you are informed about the decision (loyal reaction, later labelled compliance). I nd myself increasingly doing my job without thinking. This can be good in a way. I dont have time for gossiping in the hallways, which rarely brings anything good. In a way I just ignore thoughts about how things will go (loyal reaction, later labelled compliance).

In the second study, like Saunders and Thornhill (2003), we focused our data collection further using cards that were labeled with different reactions (and denitions) and asked respondents to pick the cards that best t their own and their colleagues reactions to two different changes (one early and one recent). While drawing on existing categories of reactions facilitates comparison of reactions across change initiatives and over time, one limitation of these categories is that they were developed based on explanations of ways of handling excessive changes. The categories may therefore be more negatively framed than in a more neutral change setting. We therefore also included blank cards allowing respondents to develop additional categories if necessary and to place these within the gure of different reactions. The compliant reaction emerged as a new category. As they identied reactions, respondents were also asked to elaborate and reect on if and why experience made them react differently. In the analysis, we rst compared typical reactions described by change recipients with limited versus extensive change experience. The strongest evidence of different reactions to change appeared to be based on retrospective accounts by respondents who compared current reactions to change with previous reactions. This is conducive with other studies of employee accounts of change where retrospective views have been found valuable for understanding how employees view and respond to subsequent changes (Chreim, 2006, p. 319).

Our preliminary analyses showed that many of the experienced change recipients reacted loyally to organizational change. However, the reasons for their loyal behavior appeared to differ and the second study indicated that there might be additional constructive but passive categories. We therefore distinguished between loyal employees by applying more ne-tuned categories of reactions which include all three dimensions of reactions: feelings, thoughts and actions (Piderit, 2000). Two new categories were employed during analysis: acceptance (dened as positive cognition, behavior, emotions) and compliance (dened as positive behavior, but negative cognition and emotion) (Chreim, 2006). Separating the loyal reactions into these two categories allowed us to probe differences in employees experiences. Our interest in employee level capabilities emerged in this process. The study was not designed with specic questions tied to employee capabilities, but rather initially focused on organizational capacity and capabilities. We therefore proceeded inductively to tease out the capabilities that our respondents appeared to describe while elaborating and reecting on their own reactions. For this analysis, the change-experienced employees who had described accepting reactions were the primary focus. Returning to the interview protocols and performing a wider search in these particular interviews allowed us to probe the underlying mechanisms that resulted in accepting loyal reactions. This step lead us to see that accepting reactions were tied to descriptions of becoming used to change, an improved understanding of the need for change, and reporting of less uncertainty and ambiguity during change. Our next step involved linking these statements and reections to the underlying capabilities that are needed to, e.g. increase the understanding of change. Through this process, the rst-order descriptions by the informants (becoming used to change etc.) were grouped into three change capabilities, which were labeled based on what our informants appeared to be describing. The capabilities (coping with uncertainty; maintaining control; increasing own market value) are presented in the second part of the ndings, where we rst describe each capability, then provide empirical evidence and nally link our ndings to existing research. Typical reactions by change experienced employees In this section, we rst describe how change recipients with limited versus extensive change experience react to change. Our analysis suggests that change experienced employees react with more loyal behavior. However loyal behavior can be a result of either change capabilities or cynicism. In the second part of our ndings we elaborate on the capabilities that are developed and examine the conditions under which change experience generates capabilities rather than cynicism. From active resistance to more passive and loyal reactions Our analyses suggest that the reactions to change differ based on the level of experience employees have with large-scale changes. In our studies, employees with limited change experience exhibited strong emotional reactions, whereas employees with extensive change experience were not frustrated by the uncertainty and insecurity of change.
I was here for the rst large downsizing processes in Sparebanken NOR in 1992. There were much stronger reactions and more insecurity because no one had experience with such processes (Union rep, DnBNor).

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Change-experienced employees did not show the same emotional reactions, and in terms of behavioral reactions, they described loyal implementation of the changes.
Earlier I experienced some resistance, people working against you, especially in the hallways and behind your back. They tried to make sure that you didnt succeed [with changes]. But theres none of that now . . . (Employee, DnBNor)

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This [more recent change] was a much more positive . . . people were very positive (Employee, AztraZeneca).

As shown in Figure 1, our data suggest that when individuals have experienced a number of previous change processes, their behavior appears more supportive of the change initiative and through their loyal behavior they contribute to successful implementation of change. While intuitively positive, the loyal reactions were not always coupled with positive cognitions and feelings about change. Some employees reacted with loyal behavior based on positive thoughts and feelings, while others loyally implemented change in spite of negative thoughts and feelings. This was by some described as the best way to react. This second group of loyal employees had become cynical towards change. In order to distinguish between these two types of reactions, we draw on Chreim (2006) who distinguishes between acceptance and compliance, which both incorporate loyal behavior. We elaborate on each of these below. Experience leading to acceptance As they gained experience with organizational change, one group of employees appeared to become prepared for and receptive to change while only a limited effort was used to resist change. They had become used to change and developed ways of handling continuous change processes in the organization. Below we describe how accepting employees drew on their previous experience to facilitate their personal transition and implementation of change. Mere experience with large-scale change processes caused employees to be accustomed to change and the sense of familiarity affected individual reactions to change.

Figure 1. How change experience inuences reactions

I think we have become better at changing. Those of us that have worked here a while have lived with changes for a long time and we react to change in a different way now as compared with the beginning. Previously, even a small adjustment was perceived as a crisis by us. Now, there needs to be a lot more going on in order to create a crisis (Employee, DnBNor)

Change experience

As individuals became used to change, they perceived change as less threatening. The uncertainty that is often described as problematic during change was reduced. There were still a number of unknown factors, but accepting employees had faith that they would pull through. The quote below indicates that although the types of changes that were introduced varied, there was something that was perceived as similar across the different types of change initiatives.
It [having change experience] is positive because change is easier to handle if you have been through it before, even if the changes are different (Employee, Posten).

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Experience also inuenced employees understanding of the need for change. Employees with limited change experience struggled to understand why they needed to make changes. In contrast, accepting employees seldom asked why changes were being made. Instead, they focused on grasping what the newest changes were about. In addition, employees learned how to handle change. Several employees described that they had begun to view change as the normal situation and as a part of the contextual or external conditions with which they have limited inuence:
Today the reaction is more, okay, now there will be changes. I do my job as usual until someone tells me that this concerns my department. So I guess there is some kind of protection mechanism that works as long as no one has said anything (Union rep, DnBNor).

Accepting employees focused instead on those factors that they felt were within their realm of control, which included daily operations and business as usual.
. . . business has to continue. Regular tasks have to be performed. Maybe thats what makes you function as well as you do, because you dont have time to think about other things . . . You dont have time to worry . . . (Employee, AstraZeneca).

Another important issue had to do with attending to ones own professional situation. Accepting employees took measures to make sure that they were t for the future in terms of their job competency and their job performance. Accepting employees describe a greater set of career alternatives and also explain how to go about evaluating different options, for instance by contacting headhunters or others in the industry, or by showing and selling their competencies to the management. Finally, accepting employees pointed out the importance of positive previous experiences with change for developing change capabilities. The quotes below suggest that positive process experience provides a sense of security and trust in management:
Our people have gotten used to change. There have been transfers, downsizing, and these have been handled in a good way. Thats very important. Experience with change then shows that its not the end of the world. Its easier to accept that change is taking place (Union rep, Nordea). Employees were repositioned within the rm. This provides a great sense of security/safety. Experiences with good ways of handling such things [as downsizing] make us trust our managers (Employee, Vesta).

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Experience leading to compliance and cynicism A second group of employees behaved loyally while expressing negative thoughts and feelings about change. Some explained that they viewed this as the least conspicuous behavior, as it created the least attention and commotion. Hence loyal behavior was sometimes based on cynicism.
The dumbest thing you can do is to resist change. The best thing for yourself, colleagues and everyone, and the company is to comply with the changes (Employee, AstraZeneca).

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Compliant employees distanced themselves from the changes and the organization exemplied by statements such as if they dont need me, I dont need them. Some employees also appeared to increasingly focus on themselves. Unlike the group of accepting employees, they did not focus on developing professional capabilities, but rather on how changes would affect their own personal situation.
Once that process [downsizing] started, it was not smart to do like some people who called in sick or cried and criticized and were negative. Talk positive. Try to nd out why changes are being made. I wanted to stay in the organization. . .and I was cynical about getting information from the union representatives . . . (Employee, Posten).

Several of the compliant employees described that based on previous change processes they had learned not to trust management. This was particularly the case when changes involved downsizing.
If changes involve downsizing then you just sit by your PC and work as best as you can and try to move very quietly about. But when no one makes resistance, it is possible to get situations where Swedish systems that simply dont work in Norway are implemented (Employee, Vesta).

In summary, while both acceptance and compliance are loyal reactions that support change implementation, the consequences of each reaction are quite different. In the short-term, compliant reactions imply that change moves slower because employees tend to distance themselves from the changes and do only what is expected of them in terms of changes. Also there will be a lack of constructive input. This might not seem so bad when compared with active resistance which appears to be more common among inexperienced change recipients. In the long-term however, submissive and passive reactions to change are likely to negatively affect employee commitment and motivation, as well as reduce the quality assurance employees apply through their contribution and input to organizational change processes. In addition, compliant reactions based on bad process experience will not likely contribute in developing change capabilities. Experience-based capabilities for change The ndings we presented in the previous section indicate that experience tends to generate loyal reactions to change, but loyal behavior can be tied both to change capabilities and cynicism. Below, we develop theory on the change capabilities that positive process experience can generate at the employee level. We refer to these as change capabilities because they allow individuals to pursue the changes in an efcient manner, while attending to daily operations. Accepting employees appear to have developed three capabilities for handling continuous large-scale change processes:

(1) coping with uncertainty; (2) maintaining control; and (3) increasing their own market value (see Figure 2). Employees who have been through a series of changes become used to change and recognize the process by which change was implemented. As illustrated in the quote below, this familiarity, when linked to positive experiences, reduces some of the uncertainty related to change and makes employees more prone to cope with the uncertainties of organizational change.
You get used to changes going on all of the time. This makes it much easier to make changes, and they are quicker . . . The process takes less time because people approach the situation more quickly with experience. It has to do with uncertainty (Middle Manager, Posten). You just have to accept it [change] in a way for your own sake and to be able to have an okay worklife. Its too exhausting to be frustrated all of the time. When you have that experience you just dont get as frustrated (laughs) (Union rep., Storebrand Bank).

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Experience-based coping does not require reection by the individual and as such it is similar to in-deliberate learning. Mere experience provides a sense of familiarity and employees, deliberately or not, draw on their previous process experience in a number of ways: they are more prepared for their own reactions; they are more aware of their career alternatives because they have previously identied a range of alternatives; they are less frightened and frustrated by uncertain outcomes. In short, they know more about the process and recognize procedures and activities that have been initiated. Hence, although the future remains uncertain, the process is familiar. This indicates that experience with different types of large-scale change can contribute to general process knowledge resembling what Schilling et al. (2003) referred to as process-based learning, as opposed to learning specic skills or knowledge about one type of change. Although getting used to change does not require any deliberation, recognizing process similarities requires an ability to abstract across change initiatives. Well-known and

Figure 2. Experience-based change capabilities among employees

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positively framed memories of change procedures and routines reduces the uncertainty and ambiguity and allows employees to spend less time guring out what is going on and they quickly orient themselves about the latest planned change initiative and how this might affect them. Change capabilities among accepting employees also involved ways of dealing with fast-paced changes, such as viewing change as an external condition and focusing on business as usual.
Today change has become a part of everyday work-life, so I focus on operations and business as usual. You cant affect everything that comes along anyway (Employee, DnBNor). [Experience with change] has a positive effect. You have been through it before and it worked out ne. You didnt think it would [work out well], but then you end up enjoying your new work (Employee, Posten).

Change always involves some level of uncertainty, which can reduce an individuals sense of control (Eilam and Shamir, 2005). Our ndings suggest that accepting employees not only reduce uncertainty by looking for similarities across change process, but also nd ways to maintain or take control.
Employees have become much better at reasoning about their options and choices . . . Previously they would become paralyzed. . .That doesnt happen any more . . . Of course each individual reacts differently, but our employees are more aware of making explicit decisions themselves. . .Many of them have witnessed colleagues who have actually gotten a better life after changing jobs (Union rep. DnBNor). A merger is an external thing even if it is also internally steered. For our organization this becomes an external condition that we have to deal with. We dont have to communicate the rationale behind the change. Its more about getting to work, because there it is not something we can ght against. The decision has been made and it cannot be reversed. This can create positive energy (HR Manager, DnBNor).

By viewing change as an external condition, as the quote above indicates, employees dene change as beyond their realm of control hence organizational change will no longer lead to perceptions of lost control. Employees are focusing on things that they perceive are within their realm of control, such as business as usual. This in turn increases the likelihood that they will succeed in reaching their goals. Externalizing change thereby allows employees to maintain a sense of self-efcacy (Bandura, 1997). Having mastered a previous change, makes these employees feel more in control. Interestingly several respondents referred to the experiences of previous colleagues who had been subject to downsizing. They described that as they had seen relevant others pull through and prosper in their new job, they gained increased faith in their own ability to do so. Recall that in the Scandinavian context, most employees have not traditionally been exposed to frequent job shifts to the same extent as many other western countries. Finally, accepting employees develop capabilities on how to upgrade their professional competencies. Because of frequent organizational changes they become extremely aware of their own competencies and the ways in which these can be used in this or any other organization.
You perhaps get in touch with other employers, check the market. Then possibilities open up. If you have been through this before, it is easier to handle . . . you know what to do. Your reactions become more constructive for yourself (Employee, AstraZeneca).

Our most change willing employees are the ones who have experienced change experienced being in a number of different positions and it has to do with competencies. Being condent about your level of competence condent that it can be used in a number of different places (Union rep., DnBNor).

Change experience

Some employees use organizational change initiatives as a deliberate way of upgrading their own competencies, either by making use of professional advice or accepting offers for executive programs. The reasons for focusing on their own professional competences may be tied to the previous point about taking control over those things that are within employees realm of control. However, it may also reect a more individualized focus in organizations, where employees strive to take care of themselves, as the organization no longer can provide any long-term guarantees. This is also conducive with the union representatives perspective, as illustrated in the second quote below.
Yes you get used to changes. But the rst question you ask yourself is always if this will affect me? You become egotistical (Employee, Vesta). Our ambition is to provide possibilities for career development and security. But security is not employment from age 20 to 67, but the possibility to develop and become attractive on the general job market (Union rep, Nordea).

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Some researchers question the demand on employees to be exible and argue that the relationship between managers and employees has been altered and that employees are now expected to work longer hours, accept greater responsibility, be more exible and to tolerate continual change and ambiguity which can negatively affect employees sense of worker dignity (Cartwright and Holmes, 2006). Likewise, the literature on downsizing and organizational commitment suggests that several rounds of downsizing have changed how employees perceive their commitment to organizations and that the bond between employee and organization has declined (Naus et al., 2007). Hence, while the tendency to focus on own competencies is positive for the organization, it is important to bear in mind that this could be a reection of a perceived need to upgrade competencies in order to be attractive for this (and other) organizations in the future and a focus on ones own market value, perhaps at the expense of organizational needs. Learning to lay low and keep quite Compliant employees developed experience-based capabilities for handling change as well. Our data on compliant and cynical reactions suggests that employees with bad process experience had learned to distance themselves, lay low and keep quiet. Although these capabilities do not fall within our denition of change capabilities as they fail to contribute in driving the change forward, it is important to understand these reactions. Our ndings suggest that bad process experience is an important explanatory factor.
Organizational history is very important. How did you handle downsizing in the previous process? If poorly, then any new change process is doomed to fail . . . . This [previous experience] is the basis for whether or not employees will want to be a part of future change processes (Union rep, DnBNor).

Previous studies on reactions to change have argued that in some cases, employees have learned that loyal and passive reactions pay off (Bryant and Wolfram Cox, 2004). There is evidence that not saying the wrong things becomes important as those people who

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speak up are punished, while those who remain quiet benet from the changes (Bryant and Wolfram Cox, 2004, p. 585). Morrison and Milliken (2000, p. 706) argue: employees often feel compelled to remain silent in the face of concerns or problems. We did not nd evidence of specic benets that were provided for those who kept quiet in the organizations we studied, but our data do suggest that with experience, fewer people were willing to voice disagreement. The management in one organization expressed a concern about the lack of input and enthusiasm for change among some employees and therefore launched a project aiming to energize and activate employees. In summary, employees with positive change experience appear to have developed change capabilities that make them more exible and change willing. This is particularly interesting in the Scandinavian work context, which tends to be characterized by lower mobility (particularly Norway and Sweden) than many of its European and North-American counter-parts. In Scandinavia there is also a propensity to voice disagreement due to the low power-distance between management and employees, which appears to be reduced as employees become more experienced. Our analyses suggest that change capabilities can be developed among employees provided the processes are well-managed. Poorly managed change processes on the other hand result in learning how to distance oneself from the organization. Managements role in developing employee capabilities for change We have argued that experienced employees react more loyally to change, but there is also a risk of more passive reactions. Management needs be aware of common reactions when employees have been through a multitude of planned changes over time. Change-experienced employees emphasize the procedures through which changes are made (how change is implemented) and activate memories about how previous processes were managed. Management plays a pivotal role in generating positive change process experiences. Previous research has argued that experience-based reactions depend on relational aspects such as how managers treat employees during change (Thornhill and Saunders, 2003). Our ndings support this, but in addition, our respondents point out the importance of structural aspects, such as planning and organizing the process. Managers who had experience with continuous and multiple changes had developed routines and procedures which created predictability for employees.
Change experience allows you to capitalize on the structural capital in the organization, which means that you dont need so much trial and error. You have a good idea of how this is going down, but then it has to be adjusted to the situation at hand. So it wont be exactly the same, and you have to be careful not to think to that two situations are identical. But you have a structure and a way of thinking that will help you (Top manager, DnBNor).

Although new change projects involved ambiguous and uncertain outcomes, the routines through which the changes were implemented had several similar features. This reduced uncertainty about the process and provided a sense of security and trust between employees and manager supporting and facilitating the development of employee-based capabilities for change. Conclusions and implications We have examined how experience inuences employee reactions to change. Our ndings suggest that some employees develop capabilities to cope with fast-paced

change initiatives. However, the picture is not one-sidedly positive. While one group of employees effectively implemented change by drawing on experience-based capabilities, another group of employees implemented change in a passive manner without any enthusiasm, because their experience suggested that this was the least conspicuous way to react. Our ndings make three contributions to the existing literature. First, our study supports and extends recent studies indicating that experience is an important factor for understanding reactions to change (Thornhill and Saunders, 2003; Bryant, 2006). Previous literature has focused predominantly on explaining reactions based on personality factors, the type of change (e.g. alliances), or characteristics of the change process. Our ndings suggest that experienced employees do not actively resist change, but instead show loyal reactions. Hence the literature on negative reactions to change can only provide limited insight to reactions among change-experienced employees. Second, our ndings indicate that not only the level of experience but also the type of experience matters for employee reactions. These ndings contribute in explaining the opposing effects of experience found in recent literature on experience and reactions. Thornhill and Saunders (2003) reported that experience had both negative and positive inuences on change reactions and that change experienced employees felt both more secure and became more resigned. Our study shows similar ndings in that employees can both develop capabilities for change and cynicism towards change. We extend current insights by providing additional explanations for this dual picture. Our ndings point to the important role management plays in terms of planning and organizing the change process and hence providing a familiar structure on the activities that take place during implementation of change. Third, our study identies change capabilities that are developed at the employee level. Previous literature has emphasized dynamic capabilities at the rm level as well as managerial capabilities for change. Our study shows that positive experience with change can contribute to the development of change capabilities also at the employee level, by generating an ability to cope with the uncertainties of change, maintaining control and increasing ones own market value. Managers play an important role in facilitating the development of employee change capabilities. There are some limitations to our ndings. First, there is the issue of self-selection in our data set. Employees who remain in the organization after many fast-paced changes may be those who are prone to loyal behavior. We attempted to reduce this limitation by including employees who had exited the organizations we studied as well. However, our studies mainly consisted of survivors of multiple change processes. Second, there is also a risk that employees respond what they believe is politically correct. One way in which we attempted to handle this was to probe employees about other peoples reactions as well as their own reactions. The variety in the responses suggests that employees are not only reiterating what they believe management wants to hear. Third, in focusing on general change process experience rather than a specic type of change, there is a risk of undermining effects based on specics about the change contents, such as whether the changes involved structural or cultural changes or both, or specics about the change process, such as whether hard or soft levers were used to implement change. Finally, the cultural context of our studies may have inuenced our ndings. All of our studies took place in Scandinavia, in a national context based on long traditions of work-place democracy, a relatively stable workforce, and power

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balance between employer and employee. On the other hand, one might therefore have expected much more active employee reactions, regardless of the level of experience. The ndings we have presented have implications for change managers, as they will need to adjust their change management approach depending employees level and type of change experience. Particularly in organizations with a long track record of change, management should be wary of relying on traditional techniques for mapping and reducing resistance, as reactions will likely be more passive than active. While the literature has emphasized the importance of analyzing change content in order to inform about process and understand reactions, the change capabilities we have uncovered seem to be tied to changes in general and not to any particular kind of change initiative. As suggested by Chreim (2006) it appears that process capabilities can be applied across a variety of changes. Future studies are needed in order to test the extent to which these capabilities can be applied across a wide set of change initiatives and across various organizational and cultural contexts.
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