Cracking The Code Of Change 191m1b

CRACKING THE CODE OF CHANGE By: MICHAEL BEER AND NITIN NOHRIA

GROUP : • DANIAL ZIKER • MUHAMMAD AHMED AHSAN • TABINDA RAFAT

What is organizational change? Company or organization going through a transformation. Organization change occurs when business strategies or major sections of an organization are altered. Also known as reorganization, restructuring and turnaround.

Why change fails ? 

Failure results from not having a new work environment well defined.

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Not updating the skills and attitudes of employees to take advantage of that new environment. Not adapting the structure of the organization to the new ways of working. Not revising incentives and rewards to emphasize new goals. Keeping the old cultural practices in place even when they impede the new ways of working.

Two Theories of change There are two theories of change: 1. Theory E 2. Theory O

THEORY 

Aims for a dramatic and rapid increase in shareholder value

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It is driven from the top of the organization and makes heavy use of outside consultants

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It relies heavily on cost cutting, downsizing, and asset sales to meet its objectives.

SCOTT PAPER FOLLOWING THEORY 1. 2. 3. 4. 5. 6.

Fired 11000 employees and sold off several businesses. The goals were set without input from lower levels. Dunlap outsourced many of Scott paper’s corporate functions. They had a common plan of action. Dunlap own compensation package was tightly linked to shareholders interest. The huge team of consultants was hired.

THEORY 

Aims to create higher performance by fostering a powerful culture and capable employees.

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It is characterized by high levels of employees participation and flatter organizational structure.

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It attempts to build bonds between the enterprise and its employees.

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This approach to change is a long-term proposition.

CHAMPION INTERNATIONAL FOLLOWING THEORY 1. 2. 3. 4. 5. 6.

Efforts were made to restructure corporate culture around a new vision called the Champion Way. Efforts were made to get employees emotionally committed. Employees were encourage to reexamine their work practices and behaviors. Top management encouraged experimentation. They had a skill based pay system. They relied less on consultants.

COMBINING THEORIES OF CHANGE

ASDA How ASDA resolved the conflicts of E and O along the six dimensions of change.

1. Explicitly confront the tension between E and O goals. For example: Norman started his tenure by stating, “ our no 1 objective is to secure value for our shareholders” and “ we need a culture built around common ideas …. And listening, learning and speed of response from the stores upwards.”

2. Set direction from the top and engage

people below. FOR EXAMPLE: Norman unilaterally set a new pricing strategy and shifted power from the headquarters to stores. His forthright “Tell Archie” program encouraged dialogue with all employees. He hired warm, accessible Allan Leighton to complement his own theory O leadership style and stregthened emotional commitment to the new ASDA.

3. Focus simultaneously on the hard and

soft sides of the organization. For example: Norman set out to win both hearts and minds. He boosted economic value through hard, structural changes, e.g., removing top layers of hierarchy and freezing all wages. He paid equal attention to the soft side by spending 75% of his early months as HR director creating a more egalitarian and transparent organization--- “a great place for everyone to work.”

4. Plan for spontaneity. For example: Norman encouraged experimentation, setting up three “risk free” stores where employees could fail without penalty. Managers experimented with store layout, product range, employee roles. A cross functional team redesigned ASDA’s entire retail organization—and produced significant innovations.

5. Let incentives reinforce change, not

drive it. For example: ASDA applied theory E incentives in an o- like way. It encouraged all employees to participate actively in changing ASDA. And it rewarded their commitment with stock ownership and variable pay based on corporate and store performance.

6. Use consultants as expert resources who empower employees. For example: In ASDA the engagement of consultants was cut short by Norman to prevent ASDA and its managers from becoming dependent on the consultants. For example, an expert in store organization was hired to the task force assigned to renew ASDA’s first few experimental stores, but later stores were renewed without his involvement.

How The Idea Is Applicable To Pakistan?? FOR EXAMPLE:

Pakistan Cricket Team

How the idea is implemented in personal life ? For example: PARENT CHILD RELATION

Hadiths That Will Change Your Life "This world is the prison of the believer and the paradise of the unbeliever." [Muslim] "The strong man is not the one who throws people in wrestling. The strong man is the one who has control of himself when he is angry.“ "If someone does not show mercy to people, Allah will not show mercy to him.“ "Anyone who shows the way to something good has the same reward as the person who does it." [Muslim]