Unit overview & introduction Topic 1: Managing change as a process "Who-Wants-Change-Crowd-Change-Management-Blue" by Alan O'Rourke is licensed under CC BY 2.0 MMH356 Change Management T2, 2021 Today you will explore: 1. Home page welcome 2. Welcome – start here video and text 3. Introductory unit information • Unit teaching team • Seminars • Textbook • Assessment 4. Topic 1: Managing change as a process • Chapters 1, 2 & 3 MMH356 Topic 1 2 MMH356 Topic 1 3 Who we are: T2, 2021 MMH356 Unit Team Unit Chair, lecturer (Burwood), tutor Dr Andrea Howell Email: andrea.howell@deakin.edu.au Lecturer (Waterfront), tutor Ms Kerry Langton Email: Kerry.Langton@deakin.edu.au Guest Lecturer, on-line tutor Mr Mike Bengough Email: mike.bengough@deakin.edu.au MMH356 Topic 1 Seminars: •Three on campus seminars (Burwood); one on campus seminar (Waterfront); one on-line seminar: •On-campus students • Burwood: • 3pm LB2.101 • 4pm LB2.101 • 5pm LB2.308 • Waterfront • 9am D4.203 •Cloud students • 7-8pm (Tuesday) MMH356 Topic 1 5 BB Collaborate online seminars Day and time: Tue 7-8pm; Link: ‘Cloud Classrooms’ via Content tab MMH356 Topic 1 Requirement: Headset with microphone Pre-read each topic case study Recordings: Available afterwards to all students Prescribed textbook John Hayes 2018 The Theory and Practice of Change Management 5th edn Palgrave Macmillan Houndmills, Basingstoke, Hampshire Hard and e-copy purchase options: • Deakin Bookshop (hardcopy) http://dusabookshop.com.au • Other online sources (check delivery time) • VitalSource (eBook) – https://www.vitalsource.com/enau/products/the-theory-and-practice-of-change-managementjohn-hayes-v9781352001327 MMH356 Topic 1 7 Assessment Assignments: 60 marks 1. VLOGS: 20 marks, due 8.00 pm 23rd August 2021 (after the intra-semester break in Week 6). 2. Group Report: 40 marks, due 8.00 pm 24th September 2021 (end of Week 10). Late submission: 5% deduction p/day, up to 5 days late On-line examination: 40 marks • Short answer theory questions • Case study application questions MMH356 Topic 1 8 Lecture slides and recordings All lecture ppts are available on the Sunday before the scheduled class time of Monday 1-3pm. They are located here (same place each week): MMH356 Topic 1 9 Weeks, topics, chapters 1. Unit overview & introduction; Managing change as a process (Chs 1, 2 & 3) 2. Recognising the need and change agency (Chs 4, 5) 3. Conducting diagnosis (Chs 7, 8) 4. Leading change (Ch 9) 5. Managing politics & stakeholders (Ch 10) 6. Communicating change (Ch 13) MMH356 Topic 1 7. Motivating others & minimising resistance (Ch 14) 8. Planning for change (Chs 16, 17) 9. Creating & selecting interventions (Chs 18, 27) 10. Implementing & reviewing change (Ch 28, 29); Sustaining change (Chs 30) 11. Unit overview, revision & exam preparation 10 Topic 1: Managing change as a process Learning outcomes In this week's lecture we focus on the stages and sequences of the process of change: A process perspective • patterns of change (Ch 3) • exogenous and endogenous factors (Reading from Liguori) • theories (typologies) of change process (Ch 1) • pace, sequence and linearity (Ch 1, Liguori) • Lewin's model of change (Ch 2) • Hayes's 5 key steps and 2 ongoing issues for change management (Ch 2) MMH356 Topic 1 11 What is change management? Before we continue, what are the key messages in this video: Read the introduction to Chapter 1: 1. 2. 3. What is the biggest problem with change? What typically accompanies change? How is change best managed? 12 Industry/practitioner perspective: • CMI • • • • Industry body Practitioner interviews Student discount CMBoK (Change Management Body of Knowledge) • For change to be effective it needs to be aligned with the organisational goals and with employee goals: • If you liken change to your body, you need: • • • • • • https://www.changemanagementinstitute.com/cmbok Brain (rational thought) Heart (emotional thought) Gut (intuition, experience, instinct) Hand (direction) Leg (movement, activity, implementation) • And most often there is too much focus on the brain. MMH356 Topic 1 13 Why study the process of change? • Let’s start from the beginning: • Early contributors to organisational theory viewed change as something that could be planned (adaptation to organisational life-cycle or ongoing “fit” with the environment). • But later theories acknowledged change is problematic because of aspects such as: • • • • Resource dependency Institutional influences Ecological populations of organisations Organisation evolution caused by punctuated equilibriums • Organisations need to adapt but successful change can be driven or constrained by exogenous and/or endogenous factors: Source: https://www.researchgate.net/figure/Thepunctuated-equilibrium-model-based-on-Gersick1988_fig6_282979703 • Exogenous factors: technology, market and institutional pressures • Endogenous factors: leadership, capabilities, culture and power • So, what helps us understand the rates, modes and pathways of the change process? MMH356 Topic 1 14 Hayes’s process approach to change STATE (content) focuses on “what” it is that needs to be, or is being changed.. PROCESS focuses on the “how” of change (pace, sequence of activities, and linearity) MMH356 Topic 1 15 Differing views of the “how” Change is generally acknowledged as involving a number of events, decisions and actions, connected in a sequence… but some theories place more emphasis on the order of the stages in the change process than others: 1. Teleological theories (purposeful & adaptive/learning is a driver) 2. Dialectical theories (conflicting goals/power shifts) 3. Life cycle theories (sequence builds to final outcome) 4. Evolutionary theories (continuous cycle/fit and resources are drivers) MMH356 Topic 1 16 Differing views of the “how What makes these theories different from each other is the degree to which they present change as: ❖ following a necessary sequence of stages, and ❖ the extent to which the direction of change is pre-determined or constructed MMH356 Topic 1 17 Pre-determined: change involves adaptation in predictable ways Life-cycle Evolution suggests a staged approach, ie start-up, growth, maturity, decline involves a slow stream of small changes (gradual & continuous) but each change follows from the previous change For example, the Bottled Water Production industry is currently in the mature stage of its life cycle. The industry is not focused on developing new products, instead companies are focused on product branding. (Source: IBISWorld, 2019). Constructed pathway: the steps can be changed (constructed) at the will of those involved in the process (human agency) Dialectical is driven by Teleological is action conflicting goals between different interest groups and that conflict can produce “a synthesis out of the ashes of the conflict engagements” (Pettigrew, et al, 2006). research, the outcomes of which drive what people have learned to make changes https://www.thecreativeeducator.com/v07/articles/Embracing_Ac tion_Research Taxi v ride-sharing services Varian, scientific equipment manufacturer 19 or COVID Liguori’s view of the change process • Pace of change (speed and comprehensiveness of change) • Evolutionary when changes occurs slowly and gradually • Revolutionary when change happens swiftly and affects all parts of the organisation simultaneously • Sequence (existence of key structural elements and the order with which they change) • Change can be all encompassing or selectively occur in some parts of the organisation • Change can move from key elements to the peripheral (high importance for the need to change) but sequence is still unknown • Linearity (the unfolding of the process of change) • Organisations are made up of an archetype - a set of structures and systems that reflects a single interpretive scheme, made up of ideas, beliefs and values. • Four options exist: 1. Reorientation or a shift from one archetype to another; 2. Inertia, old archetype is retained; 3. discontinued excursion meaning a temporary adoption of the new archetype but final return to the old; and 4. Unresolved excursion which is working between both archetypes. MMH356 Topic 1 20 Bringing Hayes and Liguori together Example 1.1: Car importer responds to imposed change (pp. 6-7) The manufacturer of an inexpensive range of cars informed an importer that it had decided to widen its market by repositioning its brand to include more expensive and better quality cars (strategy to beat competition). The importer formulates a change strategy but is met with strong resistance. The approach was re-worked but was again met with disinterest. A third change strategy was finally implemented but then environmental forces impacted both the manufacturer and the importer, which required a further re-think of both their strategies. What is the pace of change? What is the sequence? What archetype was adopted? MMH356 Topic 1 21 Sequencing: reactive sequences Change involves a number of events, decisions and actions, connected in a sequence…The change sequence can be of a reactive or self-reinforcing nature which will affect the outcome. For example, goal conflicts (dialectical theories) may give rise to negative reactive sequences which challenge the direction of change: • Example: British Air cabin crew dispute • A proposal to cut costs by reducing the number of cabin crew (mgt focus) was resisted (staff resistance). • Actions and reactions, including strikes, suspensions and dismissals, continued for 18 months. • Example: Qantas Airways dispute 2010-12 • A proposal to cut costs by outsourcing jobs overseas (mgt focus) was strongly resisted by staff & unions • Actions and reactions included strikes, and a lockdown by management which grounded the entire Qantas fleet. MMH356 Topic 1 22 MMH356 Topic 1 23 Sequencing: self-reinforcing When a decision or action produces positive feedback that reinforces earlier events and supports the direction of change. This promotes moving in the same direction. "RAAF History" by Tim Swinson | http://timswinson.com is licensed under CC BY 2.0 Three driving forces of self-reinforcing sequences: 1. increasing returns 2. psychological commitment to past decisions 3. cognitive biases MMH356 Topic 1 24 1. Increasing returns A particular technology which is first to market or widely adopted by early users (e.g. the QUERTY keyboard) may generate increasing returns and achieve a decisive advantage over competing technologies (e.g. the Dvorak keyboard) even if it’s not the most efficient Four conditions promote increasing returns: Set-up costs; learning; coordination and adoptive expectations DANGER: sticking with a “winning” formula too long and failure to respond to new opportunities and threats as they emerge (read Nokia example) MMH356 Topic 1 25 2. Psychological commitment to past decisions Escalation of commitment encouraged by: 1. Leader’s need to demonstrate competence and justify an earlier decision. 2. Response to a perceived pressure for consistency. DANGER: can be difficult to change course (read FIReControl example) MMH356 Topic 1 26 3. Cognitive biases and interpretive frames When change leaders become so committed that they only pay attention to information that supports their own position. Cognitive bias may be reinforced if: 1. 2. Leader(s) have a history of past successes Members of leadership team suppress dissent and impede reality testing (groupthink) DANGER: goals and visions can be unfit for purpose (read Direct Banking example) MMH356 Topic 1 27 Models of change: Lewin 1. Three step process 2. Force-field Waddell et al. 2017 p. 36 MMH356 Topic 1 Hayes 2018 p. 21 28 Models of change: Lewin MMH356 Topic 1 29 5 key steps + 2 ongoing issues in the change process 1. Recognising the need for change & starting the change process 2. Diagnosis of what needs to be changed including vision of a preferred future state 3. Planning how to intervene in order to achieve the desired change 4. Implementing plans & reviewing progress 5. Sustaining the change 6. Implementation issues: Leadership, stakeholders, communication, motivation/resistance 7. Learning issues MMH356 Topic 1 30 Step 1: Recognising the need for change and starting the change process (Ch 4) • recognise that external events or internal circumstances require or create opportunities for change • recognise the need for change by paying sufficient attention to what is happening in the wider environment • challenge accepted ways of thinking • involve a number of people in the formulation of the change agenda • translate the need/opportunity into a desire for change • decide who will manage the change • build effective relationships between change agents and those affected by the change MMH356 Topic 1 31 Step 2: Diagnosing what needs to be changed (Ch 7) 1. Review present state • identify required changes by diagnosing the cause of a problem or clarifying opportunities • establish a baseline so that it is clear what is changing • help define the future direction 2. Identify future state MMH356 Topic 1 32 Diagnosing what needs to be changed 3. Vision of a more desirable future state • Shared • focus attention and action, and • mobilise energy and effort • People • motivated to achieve goals to which they are committed • more committed when goals are clear and realistic • Problems • those leading the change have a vested interest in a particular outcome, or • lock on to their first vision and lock out considering better alternatives MMH356 Topic 1 33 Step 3: Planning and preparing for change (Chs 16, 17, 18, 27) Pay attention to: 1. overall change strategy 2. type and sequence of interventions 3. details that have to be managed • • when the end state can be specified when the end state cannot be specified 4. people issues 5. long-term implications of planning decisions MMH356 Topic 1 34 Step 4: Implementing change and reviewing progress (Chs 28, 29) Change plans often not implemented as intended because leaders give insufficient attention to: • Competing goals • Communicating all aspects of the change • Motivating individuals and groups to support the change • Reviewing the change and monitoring progress • Fragmentation and the lack of coordination MMH356 Topic 1 35 Step 5: Sustaining change (Ch 30) Sustained change is one where: • ‘new ways of working and improved outcomes become the norm’ and • ‘the thinking and attitudes behind them are fundamentally altered and the systems surrounding them are transformed in support’ (The NHS Modernisation Agency 2002, p. 12) Sustainability can be affected by: 1. the change strategy 2. leader behaviour post implementation 3. churn MMH356 Topic 1 36 Managing the implementation and people issues (Chs 9–12) Eg: 1. The way leaders relate to the intended recipients of change 2. Internal politics and the power of stakeholders to affect outcomes 3. Communication 4. Motivation and commitment Those leading a change need to give constant attention to shaping the political dynamics of change and motivating constructive behaviour. MMH356 Topic 1 37 References 1. Waddell, D, Creed, A, Cummings, T & Worley 2018 Organisational Change: Development and Transformation 7e, Cengage Learning, South Melbourne Australia 2. Liguori (2012). MMH356 Topic 1 38 
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