7 Innovation and Change Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. LEARNING OUTCOMES 1 Explain why innovation matters to companies 2 Discuss the different methods that managers can use to effectively manage innovation in their organizations 3 Discuss why not changing can lead to organizational decline 4 Discuss the different methods that managers can use to better manage change as it occurs Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 2 • Video Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 3 Why Innovation Matters • Innovation streams: Patterns of innovation over time that can create sustainable competitive advantage • Begins with technological discontinuity • Followed by discontinuous change • Pursued by dominant design • Leads to incremental change Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 4 Methods to Effectively Manage Innovation • Managing sources of innovation • Formation of creative work environments • Creative work environments: Workplace cultures in which workers perceive that new ideas are welcomed, valued, and encouraged • Creation of flow experiences • Flow: Psychological state of effortlessness • People become completely absorbed in what they are doing and time seems to pass quickly Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 5 Exhibit 7.3 Components of Creative Work Environments Source: T. M. Amabile, R. Conti, H. Coon, J. Lazenby, and M. Herron, “Assessing the Work Environment for Creativity,” Academy of Management Journal 39 (1996): 1154–1184. Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 6 Managing Change • Change forces: Produce differences in the form, quality, or condition of an organization over time • Resistance forces: Support the existing conditions in organizations • Resistance to change: Results from self-interest, misunderstanding and distrust, and a general intolerance for change Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 7 Managing Change • Managing organizational change is a basic process of: • Unfreezing: Getting the people affected by change to believe that change is needed • Change intervention: Process used to get workers and managers to change their behaviors and work practices • Refreezing: Supporting and reinforcing new changes so that they stick Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 8 Managing Change • Methods to manage resistance to change • • • • • • Education Communication Participation Negotiation Top-management support Coercion Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 9 Managing Change • What not to do when leading change • Not establishing a great enough sense of urgency • Not creating a powerful enough coalition • Lack of a vision • Under communicating the vision by a factor of ten Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 10 Managing Change • Not removing obstacles to the new vision • Not systematically planning for and creating short-term wins • Declaring victory too soon • Not anchoring changes in the corporation’s culture Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 11 Managing Change • Change tools and techniques • Results-driven change: Created quickly by focusing on the measurement and improvement of results • General Electric workout: Three-day meeting in which managers and employees generate and act on solutions to specific business problems • Organizational development: Philosophy and collection of planned change interventions • Designed to improve an organization’s longterm health and performance Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 12 SUMMARY • Organizational innovation is the successful implementation of creative ideas • To manage innovation, the sources of innovation should be first managed • Organizational decline occurs when companies don’t anticipate or adapt to the pressures that threaten their survival • Change is a function of the forces that promote change and the opposing forces that slow or resist change Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 13 KEY TERMS • • • • • • • • Milestones Multifunctional teams Generational change Change forces Resistance forces Resistance to change Unfreezing Organizational innovation • • • • • Change intervention Refreezing Coercion Results-driven change Organizational development • Change agent • Creative work environments Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 14 Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. MGMT8 | CH3 15
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