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Organizations must embrace change in order to thrive in the modern world. Organizational Change occurs when a company's strategies and major segments are adjusted, and the company begins to do things differently. Change is required for enterprises to satisfy the current demands of their clientele and so obtain a competitive advantage over competing firms (Robbins, S and Judge, A. 2017, 579). All organizations are operating in a changing environment. The size or market share of a corporation does not protect it against change. Many elements influence organizational change. Some of these factors include competition, the nature of the workforce, economic shocks, technology, social trends, and world politics. Change may also be planned or not. When it is planned, there is a deliberate effort by change agents within an organization to effect a difference. When not planned, it is due to shifts in environmental forces that affect a business like changes in regulations. This section is an analysis of the Organizational Change phenomena giving the relevant example in each case.
Forces That Drive Change in Organizations
Organizations change due to various factors that necessitate the change. The elements can be internal or external. Internal factors are within the control of the company while external factors are caused by a shift in the environmental forces that have an impact on it. Identifying and understanding the forces that drive change can be beneficial to firms as they can be able to adapt to change faster and therefore have a competitive edge over their rivals in the market.
One of the significant drivers of change in the modern world is technology. Technology is being used in nearly all areas of operation of an organization. Some of these areas include customer service, production, communication, and marketing. Technology has improved efficiency in businesses, which has, in turn, led to improvements in productivity. A notable example is when organizations use social media to market. According to Social Media Examiner, 97% of marketers are using social media to market with 80% of the respondents indicating that after the social media campaign traffic on their websites increased (DeMers, J. 2014, n.p). Any company that does not use technology and is still stuck in the archaic way of doing things is bound to lose out on growth and profitability.
Change can also be as a result of a changing workforce. The workforce in a company is continuously changing, employees retire, and new ones are hired. New employees will come up with new ways of doing things. An example is a change brought about by the hiring of a new C.E.O. There are also modern trends in employment that have brought about change. Outsourcing and increased diversification have made the workplace more multicultural (Robbins, S and Judge, A. 2017, 579). Companies have had to adjust to this new trends in the employment market.
Competition is also vital in change. Companies that are quick to adapt to change are more likely to grow in the modern world. When Android Operating System was launched, Nokia the leader in mobile manufacturing did not use it while its competitors like Samsung switched to the android system. Due to this fact, Nokia lost its position as a leader in the mobile phone industry. The other factor that drives change is social trends and variations in the customers’ tastes and preferences. Economic shocks can also lead to change. Mergers and Acquisitions can be as a result of companies trying to survive economic depressions.
Types of Organizational Change - Planned and Unplanned Change
Planned Change involves a deliberate move by an organization to change. It is intentional and intended to meet specific goals and objectives of the business (Robbins, S and Judge, A. 2017, 580). Planned Change aims to improve productivity through a variation in the business strategy and employee behavior. In most organizations, there is an agent that is responsible for implementing change. One of the advantages of Planned Change is that there is low resistance from employees. This is because employee engagement can be used to explain the change. Research has shown that a majority of changes fail to achieve its goals is due to internal resistance by employees (Robbins, S and Judge, A. 2017, 580). One of the areas where Planned Change has been impactful is in the implementation of new technologies. Any new technology brings uncertainties in the workplace. Employees are afraid of being made redundant by new technology, and they also resist the new ways of doing things. Planned change can be used to ease employees into their new roles and breaking down uncertainties.
Unplanned Changes are mostly rapid and occur outside the sphere of influence of an organization. An example is the housing bubble burst that happened in the last decade that led to a financial crisis. Many financial institutions had to restructure, to guarantee survival. Major U.S companies like the Lehmann Brothers declared bankruptcy and did not survive the economic shock. Companies that can readily adapt to unplanned changes are the ones that are likely to survive and grow.
One of the ways that companies can undergo planned change is through mergers and acquisitions. One of the biggest international business deals of 2016 was between Bayer and Monsanto. Bayer, a German pharmaceutical giant, announced an agreement to buy Monsanto, an American agricultural chemicals company. The main reason for this merger was to expand Bayer’s market share by breaking into the North American market. The deal was to be valued at 66 Billion Dollars, and Bayer was to buy the stocks of Monsanto. The merger is expected to lead to changes in the organizational culture of Monsanto due to the influence of their new owners. The technological transfer is also expected, and this will cause changes in the operations and production of Monsanto. This merger is a perfect example of a Planned Change since it has been initiated by both companies with the objectives of the change laid out. The goal is to take advantage of the synergies that will be created by the merger to improve productivity.
Organizational Behaviour- Work-Related Attitudes and Personalities
Employees and managerial attitude towards organizational change are critical. The success or failure of any change effort will be determined by how well employees react to the change effort. Reactions to any change effort will range from resistance to compliance to enthusiastic support to the proposed organizational change. Another important factor in change management in any organization is the personalities of the managers and employees. Employees’ self-perception, emotions, and behavior can influence his or her attitude towards change (Robbins, S and Judge, A. 2017, 581). For successful implementation of change, the right attitude and personality traits must be enshrined in the organizational culture.
Factors That Can Cause Employees to Resist Change
Resistance to change stems from factors including habits, security and the fear of the unknown, and group inertia (Katsaros, K., 2014, 37). Employees form behavioral patterns that are meant to help them cope with life's uncertainties. Habits are preprogrammed responses that employees tend to use in their daily routines. When faced with change, employees are most likely to respond to the habits that they have formed. This reliance on habits leads to resistance to change.
A lack of sense of security can also contribute to employees resisting change. Individuals who require feeling secure in the workplace can resist change due to the fear of the unknown (D'Agostino, R, and Delaney, R. 2015, 8). There is security in the norm, and when the status quo is threatened, the employees will resist change. Group norms also hinder change in the workplace. An individual may be willing to accept change in their capacity, but group norms can inhibit the initiative. Resistance to change will be because of personal and group inhibition in an organization. For change to occur the management must promote the right kind of attitude in the workplace. The management itself should have the right type of attitude, and then it will trickle down to the lower level staff.
Ideal Personality Traits That Are Best Suited To Dealing with Change
Qualitative measures and traits. Organizational change can invoke employees’ emotions as they try to make sense of the outcome of change. Managers need to have several necessary characteristics to effect change in an organization. They need to be innovative, idea champions, and ambassadors.
Innovativeness is a trait that enables an organization to generate good ideas that will contribute to the attainment of their goals and objectives. Innovative managers will encourage experimentation in the entity, reward successes, and note failures, and learn from their mistakes (Katsaros, K. 2014, 39). Innovative managers will come up with great ideas and also encourage their employees to do the same. They are alive to the fact that failures and errors are part and parcel of the learning curve.
Idea champions will drive the idea in the organization. They enthusiastically promote new change ideas in the corporation and ensure that they overcome any resistance in the business (Katsaros, K. 2014, 39). They also oversee the implementation of the new ideas. Idea champions are well versed in the changing concept, and they use communication to bring other employees on board to it. Ambassadors also are engaged in promoting the change idea in the organization. They are aligned with the concept and speak positively of the change idea. Managers who are ambassadors will work closely with the entity to come up with modes of implementing change. For a manager to be a good ambassador, they should firmly believe in the change idea.
Employees also need to have the right attitude towards change. One of the personality traits that can encourage change is the independent thought. Individuals tend to behave in a manner that conforms with the behavior of the group (Katsaros, K. 2014, 40). Employees have been known to be afraid to stand out from the crowd. Therefore, they will be influenced by the group mentality in most cases. An employee who is independent of the group will most likely be willing to change compared to an employee who conforms to the will of the group.
Just like managers, innovative employees are also likely to accept change. An employee who comes up with a new idea is already accustomed to change. This kind of trait should be encouraged in the organization. Lastly, self-efficacy and locus of control is a personality that inspires change. Self-efficacy is concerned with the perception that an individual has of themselves. They have the right skills to effect change and generate the required results. Locus of control refers to the belief that the individual has the consequences of their actions within the control (Katsaros, K. 2014, 40). Employees with high levels of self-efficacy and locus of control are more likely to adapt to change. The organization should continuously train their staff to improve their confidence levels with regards to change.
Quantitative measures of traits that support change in an organization. Quantitative analysis of personality traits involves the measurement of a combination of notable characters to develop models that can be used to predict the outcome of change based on employees' personality traits. The measurement will give a clear picture of traits effect on employee behavior. One of the tests used to measure personality traits is the Minnesota Multiphasic Personality Inventory. This test uses a scale to measure the personality of an individual. The projective test will give a quantitative analysis of employees’ personality traits. This will enable the organization to know how their employees will react to change.
One of the areas that the projective tests have been successfully applied is in the hiring of new staff. An organization would want to have the right kind of employees that can align with the organizational goal. One of the goals being ready for organizational change. Personality tests have been shown to have a positive relationship with job performance. Research shows that when used for hiring, this tools can enable the organization to employ the right kind of staff. Some of the major companies that use personality tests are ExxonMobil, Chevron, KPMG, and Citigroup among others. These companies are leaders in their industries and have been able to attract the right kind of employees into their organization.
Organizational Behaviour - Stress
The organizational change affects employees and managers differently. Some employees will welcome the change while others will become anxious and be stressed by the change. Employees and managers will be stressed if they feel that the change will affect their role in the organization (Robbins, S and Judge, A. 2017, 579). They may not know how they will fit into the new organization structure. If the organizational change is not well planned and handled, the stress levels will be high which will lead to reduced productivity.
Causes of Stress in Organizational Change
Stress can occur before, during, and after Organizational Change. Different factors can lead to stress in the process of Organizational Change. Some of the elements include anxiety due to a loss of sense of security, sense of competence, loss of relationships, lack of understanding on direction, loss of territory, and stress from the thoughts that they may lose their jobs. The uncertainty of the outcome of the change process will make both the managers and the employees anxious. Anxiety caused by the above factors will sap the energy off of the employees and managers. This will inhibit creativity and reduce the overall productivity. Different employees cope with anxiety, uniquely. It is prudent for the organization to reduce stress through proper communication.
Another factor that can contribute to stress is the feeling of anger and betrayal. Employees and managers feel there is a reciprocal obligation between them and the organization. They believe that the employer owes them due to the services they provide. When employees feel the entity has betrayed them during organizational change, they will be demotivated. This can lead to stress and eventually reduce the level of productivity.
Organizational change can also cause employees to feel helpless and vulnerable. If employees are not involved in the change process, they can feel overworked, dumb, and hurt. This will lead to the employees seeming helpless and vulnerable to the changes. This will occur mainly where there is restructuring or employment of new technologies in the workplace. When employees believe they cannot be able to match the changes - by either having skills that fit the change or control over the process; anxiety and stress will kick in.
Uncertainty and ambiguity in the change process will cause stress among the employees. This will occur before, during, and after the process. Doubt will be a factor of lack of enough information on the change process. Managers and employees can be uncertain of what the change process entails and the eventual outcome of the change. They can be unsure of their job security or their role within the organization after the change, and this will lead to stress.
Stress moderators are skills and resources that are used to reduce the impact of stress during Organizational Change. One of the methods through which the organization can minimize the effect of stress during change is through Organizational Support (Robbins, S and Judge, A. 2017, 603). Organizational Support refers to the perception that employees have on how the organization values them. During Organizational Change, employees will form opinions of how well the employer has treated them. If the entity has supported the employees throughout the process, the stress levels would be low, and productivity would not be significantly affected. The vice-versa is also expected.
Guide on How to Manage Stress during Organizational Change
Management of stress can be done at the individual level and the organizational level. At the personal level, the employee can take specific steps to reduce their stress levels. The strategies to use at the individual level include time management techniques, increased physical exercise, relaxation training, and creating an expanded social network. At the organization levels, specific stress factors can be changed and modified. The stress factors that are within the control of the management can be improved and made to suit the goal of reducing stress in the workplace (Robbins, S and Judge, A. 2017, 603). Some of the strategies that can be used include better employee selection and placement process, job restructuring, employee involvement in the change process, better communication mechanisms, and setting up of an employee wellness program (Robbins, S and Judge, A. 2017, 603).
An individual can use problem and emotional strategies to enable them to cope with stress. These strategies will allow the individual to have a sense of control over their work environment. Time management strategy will allow the employee to work efficiently. Value-focused time management can create a sense of balance in the workplace. Employees feel motivated when they are contributing to the overall goal of the company. Physical exercise and relaxation can also reduce the stress levels in employees. Exercise will improve the sense of wellbeing of employees. It can also minimize the health issues that are stress-related. When the employees' bodies feel better, then the mind is even relaxed. A relaxed mind will enable the employee to be productive. Employees also need to be in the best shape of mind to fully comprehend the change that is occurring in the organization. Employees can also use social support to cope with stress brought about by the change. Social support will include family, friends, and colleagues. An employee can cultivate a social network that will come in handy when dealing with stress. A social network will create a sense of belonging, the feeling of self-worth, and security.
The organization has an important role to play in the management of stress resulting from Organizational Change. When hiring, the institution needs to recruit employees that can quickly adapt to change. Tests should be conducted to ensure that the entity employs the right caliber of employees. The organization should also involve the employees in the process of change. When employees are included, they feel valued. They even better understand the change process. Therefore, it is easier for them to cope with the changes. Communication is also vital when implementing the change process. Effective communication will ensure that the change process is successful. Employees need to know the details of the change process to warm up to it. The organization should also ensure that there are support structures during the change. Wellness programs are designed to give employees the right kind of support, and they can be useful in reducing stress in the organization.
All organizations change. The success of change will significantly depend on how managers and employees internalize the change and respond to it. Institutions should ensure that they have the right kind of mechanisms to support any change they want to implement.
D'Agostino, R, and Delaney, R., 2015, The Challenges of Integrating New Technology into an Organization. La Salle University
DeMers, J., 2014, The Top 10 Benefits of Social Media Marketing. Available at https://www.forbes.com
Katsaros, K., 2014, ‘Exploring employees' perceptions, job-related attitudes, and characteristics during a planned organizational change,' Int. Journal of Business Science and Applied Management, Volume 9, Issue 1, PP 37-50
Robbins, S.P., Judge, T.A, 2017, Organizational Behavior 17th Edition, New York; Pearson, PP 579-603
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