Causes of, and pressures for, change

Classify change on two dimensions — it makes the analysis far sharper.

• Internal change — a new CEO, a restructure, new technology, growth, a shift in objectives.
• External change — competitors, the economy, legislation, technology, social attitudes. The firm did not choose it; it must respond.

• Incremental change — small, continuous, absorbable (Kaizen is incremental change made into a system). Low resistance, low risk — but too slow if the environment shifts suddenly.
• Disruptive change — large, fast, transformational: a new business model, a technology that makes the old one obsolete. High risk and high resistance — but sometimes the only survival route.

The examinable judgement: the pace of change inside the firm must at least match the pace of change outside it. A firm making incremental improvements to a product the market is abandoning is optimising its way into oblivion. That is strategic drift (3.10.4), and incrementalism is how it happens.

Lewin's force field analysis

Lewin models change as a battle between driving forces pushing for it and restraining forces holding it back. Score each force (say 1–5) and compare the totals.

Your turn — total driving force

Your turn — total restraining force

Your turn — net force

What a net force of +1 tells you

Lewin's key insight — and it is the mark-winner: there are two ways to raise the net force, and they are not equivalent.

• Add driving force (more pressure, more incentives, tougher targets). This works, but it raises the tension in the system: push harder against resistance and you often increase the resistance.
• Remove restraining force (consult the union, guarantee no compulsory redundancies, fund the retraining, communicate honestly). This is almost always more effective and more durable, because it changes people's willingness rather than overpowering it.

Suppose genuine consultation and a no-compulsory-redundancy guarantee cut fear of job loss from 5 to 3 and union opposition from 4 to 1. The restraining total falls to 3 + 1 + 3 + 2 = 9.

Your turn — net force after consultation

The lesson of the force field

Kotter and Schlesinger: why people resist

Four reasons for resistance:

• Parochial self-interest — people fear losing something they value: status, pay, power, or the job itself. This is rational, not stupid.
• Misunderstanding and lack of trust — they do not understand the change, or they do not believe what management says about it (usually because of what happened last time).
• Different assessments — they have looked at the same facts and genuinely think the change is wrong. Sometimes they are right, and management's job is to listen.
• Low tolerance for change — fear of not being able to cope with the new skills demanded.

Six ways of overcoming it — running from the gentlest to the most brutal:

1. Education and communication — slow, but builds lasting support.
2. Participation and involvement — powerful: people rarely resist what they helped design.
3. Facilitation and support — training, counselling, time.
4. Negotiation and agreement — buy off the resistance (a redundancy package). Costly, and it invites others to demand the same.
5. Manipulation and co-optation — put a leading opponent on the project board. Fast and cheap; if it is discovered, trust is destroyed permanently.
6. Explicit and implicit coercion — "do it or leave". Fast, and it works — at the price of morale, trust and future co-operation.

The method must fit the reason. Communication cures misunderstanding but does nothing for parochial self-interest — you cannot explain away a genuine loss of status. Speed matters too: in a genuine crisis coercion may be the only option, but the firm pays for it for years afterwards.

Match each of Kotter and Schlesinger's reasons for resistance to its meaning

Tap an item on the left, then its partner on the right.

Match the cure to the cause

The value of a flexible organisation

Some firms absorb change far more easily than others. Flexibility is designed in:

• Restructuring and delayering — flatter hierarchies, shorter chains of command, faster decisions.
• Flexible employment contracts — part-time, temporary, zero-hours, annualised hours. They let the firm flex capacity with demand and cut fixed costs — but they push insecurity onto employees, damage engagement and loyalty, and are the hard-HRM route.
• Organic vs mechanistic structures — a mechanistic structure is tall, centralised and rule-based: efficient and consistent in a stable environment, but rigid. An organic structure is flat, decentralised and fluid: it adapts fast and innovates, but it is harder to control and can be inconsistent. Turbulent environments demand organic structures.
• Knowledge and information management — capturing what the organisation knows so that it survives the departure of individuals, and reaches the people who need it.

Your turn — the saving from delayering

What does the £648,000 really cost?

Organisational culture: Handy's four types

Culture is "the way we do things around here" — the shared values, beliefs and norms that determine what people actually do when nobody is watching. It is invisible, powerful, and the single hardest thing in a business to change.

• Power culture — control radiates from one central figure or small group. Decisions are fast; the firm rises and falls with the judgement of one person. Common in founder-led firms.
• Role culture — authority comes from your position, not your personality. Clear job descriptions, procedures and hierarchy. Efficient, consistent and fair in a stable environment — slow and rigid when the environment changes. The classic bureaucracy.
• Task culture — power comes from expertise. Teams form around problems and dissolve when solved. Flexible, creative, well suited to project work and innovation — but harder to control and expensive to resource.
• Person culture — the organisation exists to serve the individuals within it (a barristers' chambers, a partnership of consultants). Highly skilled individuals; very hard to direct strategically.

Which of Handy's cultures?

Tap a feature, then tap the culture it describes.

Hofstede's national cultures — and changing culture

Hofstede showed that national culture systematically shapes what works inside an organisation. His dimensions include:

• Power distance — how far a society accepts unequal power. High power distance → a directive, hierarchical style is expected; a flat, consultative structure may read as weak leadership.
• Individualism vs collectivism — is the individual or the group the unit of achievement? Individual performance-related pay can fail badly in a collectivist culture.
• Uncertainty avoidance — tolerance of ambiguity and risk. High avoidance → detailed rules, resistance to disruptive change.
• Masculinity vs femininity · Long-term vs short-term orientation · Indulgence vs restraint.

Why change the culture? Because a culture built for the old strategy will silently strangle the new one. A firm moving from a stable role culture to a fast-innovating task culture must change the culture, or the new strategy will simply be absorbed and neutralised.

Why it is so hard: culture is unwritten — you cannot amend it by memo. It is embodied in long-serving people, in the behaviours that got them promoted, and in what the organisation actually rewards. It takes years. The classic mistake is announcing a new set of values while continuing to promote and pay for the old behaviours — at which point employees, entirely correctly, ignore the announcement. Culture follows incentives, not slogans.

Culture crosses borders badly

Thinking like an examiner

• Lewin: attack the restraining forces. It is more effective and more durable than piling on driving force — and the model's scores are subjective, so say so.
• Kotter and Schlesinger: match the cure to the cause. Communication cannot solve a rational fear of redundancy.
• Resistance is often information. "Different assessments" means the resisters may simply be right. A board that treats all resistance as an obstacle loses its best early-warning system.
• Culture eats strategy. Any strategy that requires people to behave differently will fail unless the culture — and the incentives underneath it — change too.
• The pace of internal change must match the pace of external change. That is the whole argument for the organic, flexible organisation.

The big ideas to know

Press Finish to see your score.