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Code Of Change Final

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Business
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Grantham University
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Running head: CODE OF CHANGE 1
Code of Change
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CODE OF CHANGE 2
Code of Change
Companies seeking to initiate organizational change have the option of using either
theory E or theory O. While theory E positions change based on economic value anticipated from
the process, theory O considers change based on the organizational capability and internal
culture (Beer and Nohria, 2000). The privatization of British Telecom provided an avenue
through which theory E approaches to change are manifested. Following the sale of 50% of its
shares, the new chief executive officer restructured the organization in the hopes of turning
around its performance (Hallett, 2017). Drastic layoffs to cut on operational costs resulted in the
eradication of a majority of the middle management. In the end, more than 15000 managers were
relieved of their employment. This approach contributed to increased profitability for the
company through a reduced number of employees. The motivation of the remaining employees
through financial incentives further contributed to improved performance and profitability for the
company.
The application of theory O approaches to change is based on a softer consideration of
the plight of employees. It is anchored around the principle of developing employees through
training and continuous learning (Hayes, 2018). Consequently, the implementation of change
processes involves the collection of feedback from staff to consider their inputs and the negative
implications of the change in their work environment. The chief executive officer of Virgin, Mr.
Richard Branson, articulates the values of theory O in managing change within organizations. In
the company, organizational capabilities are enhanced through learning and training of
employees. The management considers the prospects of ‘learning by mistakes’ to be a significant
ingredient in attaining success (Abubakar, 2016). Organizations that adopt this theory of change
have higher risks of unprofitability during uncertain times because they are not flexible or open

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Running head: CODE OF CHANGE 1 Code of Change Student’s Name University CODE OF CHANGE 2 Code of Change Companies seeking to initiate organizational change have the option of using either theory E or theory O. While theory E positions change based on economic value anticipated from the process, theory O considers change based on the organizational capability and internal culture (Beer and Nohria, 2000). The privatization of British Telecom provided an avenue through which theory E approaches to change are manifested. Following the sale of 50% of its shares, the new chief executive officer restructured the organization in the hopes of turning around its performance (Hallett, 2017). Drastic layoffs to cut on operational costs resulted in the eradication of a majority of the middle management. In the end, more than 15000 managers were relieved of their employment. This approach contributed to increased profitability for the company through a reduced number of employees. The motivation of the remaining employees through financial incentives further contributed to improved performance and profitability for the company. The application of theory O approaches to change is based on ...
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