Towards a Conceptual Framework
In this module you have examined the different types of change management frameworks. Now read, Rethinking organizational change: Towards a conceptual frameworkfrom the required reading list. This study proposes a conceptual framework incorporating the macro environment (industry-level changes) with organization-level changes to help practitioners build a more balanced approach to change management.
With this approach, consider the macro environment of the Kingdom of Saudi Arabia.
Discuss the six models of managing change and which you think would work best in the KSA business environment and why?
Chapter 2: How to Lead Organizational
Change: Frameworks
Chapter Overview
• Chapter 2 differentiates between HOW to change
and WHAT to change. Change leaders must
understand both.
• This chapter focuses on HOW to create change
• Six process-oriented models of planned, purposeful
change are discussed
• The last of these is the Change Path Model: it is the
guiding framework used in this book
• These six models will give you language to articulate
models of how to bring about organizational change
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
2
Getting a Handle on the Change Challenge
Two distinct aspects in any change management
situation need to be addressed:
• WHAT needs to change
• HOW to bring about that change
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
3
Sigmoid Curve
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
4
Nature of Managed Organizational Change:
Lewin’s View
Unfreeze
Change
Refreeze
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
5
Kotter’s Eight-Stage Process
1. Establishing a sense of urgency
2. Creating a guiding coalition
3. Developing a vision and strategy
4. Communicate the change vision
5. Empower employees
6. Generate short-term wins
7. Consolidate gains and produce more change
8. Anchor the new approaches in the culture
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
6
Gentile’s Giving Voice to Values
• Clarification and articulation of one’s values
• Post decision-making analysis and
implementation plan
• The practice of speaking one’s values and
receiving feedback from peers
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
7
Duck’s Five-Stage Change Curve
• Stagnation
• Preparation
• Implementation
• Determination
• Fruition
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
8
Beckhard and Harris’ Change Process Model
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
9
The Change Path Model
Awakening
Chapter 4
Mobilization
Chapters 5 through 8
Acceleration
Chapter 9
Institutionalization
Chapter 10
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
10
Components of the Model
• Awakening: Why change? What data helps
to wake people up?
• Mobilization: Gap analysis—the desired
future state and the present state
• Acceleration: Getting there from here—
action planning and implementation
• Institutionalization: Monitoring, measuring
the change, and helping to make the change
stick
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
11
Toolkit Exercise 2.2
Interview a Manager
❖ Interview a manager who has been involved in implementing an
organizational change. Ask them to describe the change, what
they were trying to accomplish, and what happened?
❖ HOW did the managers work to make things happen? Who did
they involve? How did they persuade others? What resources did
they use?
❖ Describe WHAT was being changed. Why were these things
important?
❖ Which was more important to the change in the end: HOW things
were changed or WHAT was changed?
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
12
Summary
• We need to differentiate between WHAT needs to
change and HOW to change
• This chapter has focused on the HOW change is
accomplished, i.e., the process
• The HOW of change is all about managing the
process. This chapter gives us ways of thinking
about this process with particular attention to the
Change Path Model
Deszca, Ingols & Cawsey, Organizational Change: An Action-Oriented Toolkit, 4th ed.. © 2020 SAGE Pub.
13
SOUTH ASIAN JOURNAL OF MANAGEMENT
Rethinking Organizational Change:
Towards a Conceptual Framework
Arbind Samal* and Devjani Chatterjee**
In this paper, a systematic process of literature review has been followed to identify diverse
nomenclatures and common themes within the existing literature on organizational change.
The role of organizational readiness and employee resistance, along with their antecedents
are discussed in the study. Additionally, it is emphasized that while considering change initiatives,
organizations also need to carefully evaluate three parameters of change, i.e., ‘rate of occurrence’
of change, ‘the scale’ of change, and ‘the implementation’ process of change. In particular, the
paper proposes a conceptual model that features and extends upon the previous work on
trajectories of industry-level changes based on the ‘core assets’ and the ‘core activities’ of an
industry for instituting appropriate change strategies at the organization level. Such
categorization can help organizations identify and adopt the right change strategies within
their ecosystem while at the same time planning for change interventions in the real world
scenario.
Key Words: Change Implementation Process, Employee Resistance, Industry-level Change,
Organizational Change, Organizational Readiness
INTRODUCTION
A plethora of definitions and approaches to the concept of organizational change has
resulted in an ambiguity in the way the change management literature has evolved so
far (Chatterjee, 2014). The current paper attempts to identify and simplify the current
state of literature in change management vis-à-vis factors such as, resistance to change,
organizational readiness to change, change implementation process, and scale of
change. Further, it is argued that scholars and practitioners have applied content,
contextual, procedural, and criterion variable (Armenakis and Bedeian, 1999) while
assessing organizational change. However, studies addressing the nature of industrylevel changes (McGahan, 2004) concerning organizational change processes are limited
*
**
Doctoral Research Scholar, Human Resource & Organizational Behavior Area, Indian Institute of Management
Kashipur, Kundeshwari, Kashipur 244713, Uttarakhand, India. E-mail: arbind.fpm1701@iimkashipur.ac.in
Assistant Professor, Human Resource & Organizational Behavior Area, Indian Institute of Management
Kashipur, Kundeshwari, Kashipur 244713, Uttarakhand, India. E-mail: d.chatterjee@iimkashipur.ac.in
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RETHINKING ORGANIZATIONAL CHANGE: TOWARDS A CONCEPTUAL FRAMEWORK
in the change management context. Such changes in the business environment have
forced organizations to rethink on their existing strategies of doing business (Chakraborty
and Sur, 2015). We believe the current study is important and long overdue in the
present context, as the dynamics in which a business operates in the current scenario
have drastically changed post-liberalization, privatization and globalization.
Despite growing interest and recent developments in the area of organizational
change, evidence suggests that almost 70% of all change measures fail in the
organizational change management context (Cartwright and Schoenberg, 2006). Past
studies suggest change readiness among the organizational members as crucial for
accepting and adopting change within the organization (Armenakis and Bedian, 1999).
Consequently, the recipient’s reaction to change will determine the change’s potential
success (Oreg, Vakola, and Armenakis, 2011). Managing change within the
organization requires a solution for complex situations and problems, which, in turn,
results from a cognitive process. In the organizational context, employees react to
change initiatives with caution while relying on leaders for legitimacy gains and
establishing cues that alleviate concerns associated with a proposed change (Prasad
and Sayeed, 2006; and Jacob, 2014). Furthermore, past studies indicate that culture
and value system within employees and organizations shape such a cognitive process,
although the topic has received limited attention from scholars and practitioners so
far. Within the organizational change management context, failures of many change
initiatives are attributed to resistance among the employees (Piderit, 2000). To that
end, identifying the sources of resistance within the organization may provide a hint
to managers and change agents for initiating and implementing a successful change
program (Pardo and Martínez, 2003).
Organizational development scholars in the area of change management have
conceived and developed various frameworks for managing organizational change
based on contextual variables. Their findings suggest three important aspects that
govern change. First, the rate of occurrence of change (Todnem, 2005). Second, change
can be triggered by both intrinsic and extrinsic factors in any of its diverse forms
which apply to most organizations (Balogun and Hailey, 2008; and Carnall, 2014) and
lastly, the scale of change to be implemented (Dunphy and Stace, 1993). Organizations
today operate in a much more unpredictable and uncertain business environment, as
such, there is a need for firms to understand and align their strategic goals and
innovation process based on respective industry characteristics (McGahan and Porter,
1997). In this study, we extend upon the work of McGahan (2004) to propose a
theoretical framework of organizational change management process vis-a-vis changes
occurring within the industry based on the latter’s underlying core assets (e.g.,
organization’s resources, knowledge and brand capital) and core activities (traditional
modes which have garnered profit for the firm).
Through our paper, we make three contributions to existing literature on
organizational change management. First, we carefully analyze the existing literature
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on organizational change to simplify complex nomenclatures and develop unambiguous
themes common to the organizational change management process. Second, we provide
a paradigm for carrying out a systematic literature review process (Denyer and Tranfield,
2009) grounded in methodological and theoretical rigor. Such a methodology ensures
that a large number of papers are selected and analyzed without omitting significant
contributions from practitioners and scholars. Last, we answer the call for studies on
new contextual variables in the organizational change management domain by proposing
a framework of process fit between industry-level change and appropriate organizational
level change leading to firm’s long term growth and success. In summary, we posit that
existing literature on organizational change management continues to be responsive
to the need of industry and organizations by providing theoretical as well as actionable
insights for both scholars and practitioners. The remainder of the paper is structured
as follows. In the next section, the review methodology is discussed, followed by a
summary literature review for basing our conceptual model. The paper concludes
with a discussion and managerial implications of the study. Future scope of the study
is also presented at the end of the paper.
METHODOLOGY
For the review purposes, we have adapted and modified Denyer and Tranfield (2009)
methodology of literature review to identify relevant literature on change published
post the liberalization, privatization, and globalization era, i.e., from 1992 till 2017.
Additionally, we have also included few papers beyond the stated time frame so that
major individual contributions are highlighted and thereby ensuring that our review
remains exhaustive and meaningful (see Figure 1). The entire process of review was
carried out in four phases for selection and further analysis of papers to bring out the
common themes that address our research question.
REVIEW METHOD
Phase-I
The first phase required the formulation of research objectives and questions. Since
the area of change management within the organizational context is quite broad, we
have focused on particular themes relevant to change in organization and industry
level only.
Phase-II
Following the works of Wong, Skipworth, Godsell, and Achimugu (2012), articles for
review were identified from reputed journals under peer-reviewed category. Relevant
papers published in the English language only were searched using Library resources,
EBSCO and J-Gate search engines that yielded a significant number of papers. It
should be noted that several papers appeared in more than one search engine. A
number of keywords were identified to obtain the most relevant research papers based
on a three-level keyword formulation.
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RETHINKING ORGANIZATIONAL CHANGE: TOWARDS A CONCEPTUAL FRAMEWORK
Research planning
Inclusion criteria
Research
objectives
• Published in peer rated
journal
• A 3-level keyword search
item
Formulation of research question
Selection of article published in peer
reviewed journal
Locating studies and evaluation
Data analysis and comprehensive review
Results and
recommended actions
Phase-IV
Phase-III
Phase-II
Phase-I
Figure 1: Methodology
• Excludes articles without
the specified search terms in
either abstract, title or
keyword
• Excludes
articles
unpublished
Exclusion criteria 2:
Preliminary screening
• Excludes articles not
relevant to organizational or
industry change
Final screening
• Ambiguity in definitions and
nomenclature in change
management process
Developing Schemes
• Inadequate process fit
between industry and
organizational level change
Industry
change
Organizational
change
Readiness
to change
Exclusion criteria 1:
Resistance
to change
Three parameters
of change
Core Assets
Research Gap
Conclusion
Source: Adapted and modified from Denyer and Tranfield (2009)
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SOUTH ASIAN JOURNAL OF MANAGEMENT
Figure 2: 3-Level Keyword Formulation
Level I
Level II
Level III
Source: Authors’ Analysis
Different keywords within each level were attached to ‘OR’ connector whereas
‘AND’ connector was used to link different levels while conducting the search process.
Employing such a broad search string enables maximum possible access to related
papers on a certain topic. The keywords used for searching papers included many
topic words but not restricted to; organizational change, culture and change, planned
change, emergent change, resistance to change, industry lifecycle, industry change,
organizational innovation, radical change and incremental change (see Figure 2). To
make the present effort manageable specific time frame was chosen for searching
relevant literature on change in the organization and industry context. Preliminary
screening led to the retention of 381 papers out of which 89 relevant papers pertaining
to our research context were retained for further analysis.
Phase-III
Systematic and comprehensive analysis of the selected papers were carried out to
develop the most relevant research themes on change in our research context.
Additionally, the literature on industry-level changes was also searched from Harvard
Business Review to supplement our search criterion. The final review was carried out
based on 64 papers and 3 selected books on organization innovation and change.
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Phase-IV
Based on the analysis in Phase-III, research gap, suggestions and concluding remarks
are presented at the end of the paper.
LITERATURE REVIEW
EVOLUTION OF CHANGE MANAGEMENT MODELS
Over time, there has been a proliferation of investigations into organizational change;
and so, design and execution of programs for large-scale transformation is often
considered central to organizational performance. The changes that underscore
economic, geopolitical, technological and socio-cultural environments in which
organizations operate are increasingly considered an essential characteristic of
organizational survival (Mahato, 2015). Labels such as readiness to change, resistance to
change, rate of change, and scale of change have all been evoked within the organization
change management context. According to Rieley and Clarkson (2001), constant
change often lead to ineffective organizations. People need to perform routine tasks
for specialization and for improving productivity (Luecke, 2003). However, for
organizations to succeed, people must be able to handle change (Burnes, 2015). Lewin
(1946) proposed one of the earliest models of the change management process. He
distinguished the change process into three steps, i.e., unfreezing, change, and
refreezing. Subsequent models developed by researchers were an extension of this
basic model, highlighting different contextual issues. For e.g., Greiner (1978) suggested
seven steps for implementing change within the organization while emphasizing the
importance of organizational history and the context of organizational maturity for
implementing change. Bullock and Batten (1985) emphasized interpersonal relations
among the organization’s members during change implementation. Similarly, Nadler
and Tushman (1997) underlined the psychological dimension of change.
Armenakis and Bedian (1999) identified four themes that highlight the change
process; (i) content issue; (ii) process issue; (iii) criterion issue; and (iv) contextual
issue. Content issues include factors such as organizational structure, strategic
orientation, and performance incentive system, which defines the relationship of the
firm with the external environment, whereas contextual issues focus on conditions
and elements that operate within the organization’s internal and external environments.
In the organizational context, internal factors are related to the degree of specialization
of the company’s previous experience with change, whereas external factors include
government rules and regulation and competition operating within the business
environment. Process issues are related to actions undertaken during the
implementation of an intended change. These issues highlight not only the change
process but also the organizational member’s reaction to such change.
Finally, criterion variables are referred to as the outcomes of change implemented
within organizations. Furthermore, Damanpour (1991) advocated that successful
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change may involve a fit and congruence among the content, context, and procedural
variables, thus highlighting the issue of resistance to change. Shaw (2003) proposed
the complex-responsive model that lay thrust on managers who are managing and
initiating change in the organization. Finally, Cameron and Green (2015) draw our
attention to the importance of developing employee ability for achieving goals,
encouraging feedback, and information flow as key elements for managing change in
an organization. In sum, our examination of change literature confirms that the
literature on organizational change has so far focused on content, context, and process
issues while evaluating on ‘why’ and ‘how’ organizations change, and there is a need
to explore new dimensions that impact organizational change vis-à-vis industry level
changes. Some of the prominent change models with their respective themes are
enumerated in Table 1.
Table 1: Prominent Change Management Themes
S. No.
Year
Author/Model
Theme
1.
1946
Lewin
Ignored factors like politics and power. Thrust is on top-down
approach for planned approach to change.
2.
1978
Greiner
Focused on organizational identity and age of enterprise for
implementing change.
3.
1985
Bullock and
Batten
Focused on the role of interpersonal relations among the
members of the organization during change implementation
4.
1991
Damanpour
Resistance to change based on contextual factors.
5.
1992
Burke and Litwin Studies strategic orientation, organization structure, and
organization-environment fit that define an organization’s
overall character, mission, and direction, as well as underlie
its long-term success.
6.
1995
Kotter
Themes based on procedural changes and implementing
change.
7.
1997
Nadler and
Tushman
Underlined the psychological dimension of change
8.
1997
Sastry
Considered factors like strategic orientation, inertia
(resistance), perceived performance by top managers and
pressure for change.
9.
1999
Armenakis,
Harris and Field
Model describes multi-phase steps for change agents to follow
for implementation.
10.
2003
Shaw
Model lays thrust on complex- responsive approach for change
initiation with emphasis on change agents.
11.
2015
Cameron and
Green
Model emphasized on flow of information and employee
feedback system.
12.
2017
Hughes
Underlined the importance of agency and change
Source: Authors’ Analysis
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ORGANIZATIONAL READINESS TO CHANGE
Change cannot be implemented in an organization if employees are unwilling to support
and participate in change initiatives. Armenakis, Harris, and Mossholder (1993) defined
readiness as “organizational members’ beliefs, attitudes, and intentions with respect
to the extent to which changes are needed and the organization’s capacity to successfully
make those changes. It is the cognitive precursor to the behaviors of either resistance
to, or support for a change effort”. Although this definition of organizational readiness
is widely used in change literature, it does not take into account the variation in the
organization’s levels of change readiness. Therefore, a more holistic approach implicating
different levels such as at the individual, group or organization level is essential for
understanding and implementing change readiness within the organization. Ignoring
the dynamics operating within different levels of change readiness may lead to
ineffective change implementation (Vakola, 2013). Individual-level readiness involves
harnessing the malleable traits based on psychological predisposition such as personality,
self-efficacy, and positive affectivity of individuals in the organization (Markus and
Kunda, 1986; Oreg, Vakola and Armenakis, 2011). Organizations should, therefore,
attempt to identify and nurture individuals through strategic human resource
management practices such as employee development, training, and appropriate
selection of change agents that harbor positive affect towards change initiatives.
Group level readiness is related to the collective perception of members of the
organization related to (1) the need for change; (2) organizational readiness to change;
(3) ability of the group to deal with change; and (4) perceived group benefits. For
example, King and Anderson (1995) identified group cohesiveness, social norms, team
solidarity, rejection of outsiders, and conflict as a source of group resistance. In sum,
change interventions at the group level should emphasize the creation and sustenance
of positive affect among the group members while embracing organizational change
initiatives. Lastly, at the organizational level, readiness to change refers to the existing
systems, structure, process, leadership commitment, and culture that either foster or
disrupt change initiatives.
Organizations need to be in a state of readiness to undertake a proposed change
(Jones, Jimmieson and Griffiths, 2005). To that end, a change recipient’s perception of
organizational readiness will determine his or her attitude towards change (Eby, Adams,
Russell and Gaby, 2000) and, consequently, determine the course of organization
development. Although very important, this construct has not received due importance
from researchers and practitioners (Armenakis, Harris and Mossholder, 1993). Change
readiness should, therefore, be incorporated at individual, group and firm’s strategic
levels because by creating an ongoing change readiness at all the three levels,
organizations can gain flexibility and adaptability essential for managing change
initiatives.
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RESISTANCE TO CHANGE
Resistance serves as the key impediment while implementing change within
organizations (Haslam and Pennington, 2010). The traditional person-centric approach
demonizes employees who resist change (Giangreco and Peccei, 2005). Practitioners
and organization development scholars traditionally view Resistance to Change (RTC)
from the individualistic lens, i.e., resistance lies within the self of the individual.
These include factors such as fear, aggression, mistrust, personality uncertainty, and
conflict (Dent and Goldberg, 1999). In this spirit, organization development practitioners
view resistance as pathological in nature, something the change agents need to
overcome while implementing change measures (Voronov and Woodworth, 2012). In
the organizational context, resistance to change (RTC) occurs at three levels, i.e., at
the organization, group, and individual level (George, Jones, and Sharbrough, 2005).
Resistance at the organizational level is related to conflict and power, improper
functional orientation, and incompatible organizational culture (George, Jones, and
Sharbrough, 2005). Group-level resistance mostly occurs due to incompatible group
norms and groupthink (Singh, Saeed, and Bertsch, 2012). Finally, resistance at the
individual level occurs mostly because of selective perception among employees,
propensity for uncertainty avoidance, and, at times out of habit (Ansoff and McDonnell,
1990).
Current literature on organizational change focuses on content-related variables
such as communication and employee involvement in studying RTC (Bhattacherjee
and Hikmet, 2007; and Georgalis, Samaratunge, Kimberley, and Lu, 2015). However,
little research has gone into understanding the source of RTC. To that end, Shimoni
(2017) identified four approaches for dealing with resistance to change: (1)traditional
approach; (2) social context approach; (3) social construction approach; and (4) habitus
oriented approach. The traditional approach to RTC advocates focus on individual
factors to mitigate resistance to change. In that sense, Schein (1999) advocated change
agents to treat the recipients sensitively and build trust among the followers.
Nonetheless, the traditional approach to RTC has its fair share of shortcomings as
well. Viewing individuals as resisters in the starting point may not be a rational approach
as anxiety and apprehension on the part of change recipients may jeopardize the
implementation of the planned change initiative (Waddell and Sohal, 1998). Secondly,
such an approach may lead to enhanced fear and anxiety while creating further
resistance (Boyd and Bright, 2007).
Often running parallel and alternative to the traditional approach is the social
context approach in which more and more researchers are looking at resistance not
from an individual angle but from the contextual viewpoint in which the change
occurs. Following this direction, Organization Development (OD) practitioners of
the social context approach started considering the role of culture and structure for
studying resistance to change (Burnes, 2015). Additionally, advocates of the social
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context approach argue that employees who do not fit the desired organizational
culture or structure should be replaced (French and Bell, 1973; and Burnes, 2015).
OD scholars and practitioners of both traditional, as well as social context approach,
view personal and social context separately. Indeed, most empirical studies on resistance
have barely focused on the interplay between social context and individuals in
predicting employees’ behavior during organizational changes (Oreg, 2006; and Oreg
and Goldenberg, 2015).
The social construction approach advocates that organizations in today’s global
context need to adopt a more balancing approach between structure and culture so
that change initiatives and its implementation can be more effective while minimizing
resistance to change (Senge, 1997). Furthermore, the social construction approach
advocates that potential resistance among individuals lies in the individual’s
psychological disposition, which can be moderated by managers and thus act as a key
to balancing individual and social context of resistance to change. Finally, the last
approach to resistance to change is identified as the habitus approach. Bourdieu (1989)
defined habitus as a “set of social dispositions, both internal and external, that generate
social agents’ thought and behavior.” Members acquire these social dispositions through
socialization, ingrained within the family, gender group, and working organization.
These social dispositions often influence employee thoughts and behavior, including
resisting behaviors (Kitchin and David Howe, 2013; and Sieweke, 2014). The habitus
approach to RTC thus provides a theoretical framework to understand the fact that
people devise and improvise on strategies based on their social disposition but within
the structural opportunities and constraints.
THREE PARAMETERS FOR CLASSIFYING CHANGE
Moran and Brightman (2000) defined organizational change as “continuous renewal
of an organization’s strategic direction, structure, and capabilities to meet the everchanging dynamics and needs of external and internal customers.” Similarly, Burnes
(2004) explained that the change is an omnipresent element in any organization’s life
that operates at both operational and strategic levels. Thus, it can be construed that
organizational change and organizational strategy go hand in hand (Rieley and
Clarkson, 2001). While change is unpredictable, it can take any form characterized
by ad hoc situation, reactivity, and discontinuity, thereby plunging a firm into a state
of prolonged crisis (Nelson, 2003). Although extant literature on the change
management approach is exhaustive in nature, the field lacks empirical evidence for
supporting different theories suggested therein (Guimaraes and Armstrong, 1998). In
this section, we have identified change characterized by ‘rate of occurrence,’ its
‘implementation process,’ and ‘scale of change’ as the main parameters of change. It
should be noted that processes such as Total Quality Management (TQM) embrace
several of these characteristics (Pettinger, 2004), however in this paper we have
restricted our review to the three parameters of change proposed by Senior (2002) to
converge on an appropriate proposal, rather than getting more scattered and ambiguous.
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Change Characterized by its Rate of Occurrence
Past literature suggests incremental and radical change as the two main categories of
organizational change (see Table 2). However, such a classification seems to be overly
simplistic. Moreover, definitions of these concepts tend to vary (Higgs and Rowland,
2005). For e.g., Burnes (2004) identified incremental change as “those occurring in
individual parts or level of an organization that deals increasingly and separately with
one problem and one objective at a time.” In addition to defining the incremental
change, he further created a distinction between incremental and continuous change.
The former is associated with departmental and functional changes, whereas the latter
is related to organizational-wide changes. Combining the above two categories will create
difficulties while differentiating between departmental and organization-wide changes.
Adding to the ever-increasing terminology and confusion, Senior (2002) further classified
incremental change between smooth and bumpy incremental change. Smooth incremental
change is associated with a slow predictable path of change, whereas bumpy incremental
change is identified with a short period of stability interspersed between a period of
relative acceleration in change activities. Such a form of change is also termed as
punctuated equilibrium change (Burnes, 2004; and Balogun and Hailey, 2008).
As far as discontinuous change is concerned, Grundy (1994) defines discontinuous
change as “change which is noted by shifts in strategy, structure or culture, or in all
three.” In the same line, Luecke (2003) termed discontinuous change as similar to
radical change while classifying such changes as an onetime event that takes place
through organization-wide changes and often followed up by long periods of relative
stability. In a nutshell, our understanding of change characteristics suggests that there
is no one single recipe for managing change. Organizations such as Toyota and Google
continue to improve and sustain growth well into the future and that too ahead of
everyone else by relying on a combination of continuous incremental changes and
periodic radical innovations, in a nutshell, creating a transversal process that factors
in both type of change.
Change Characterized through the Implementation Process
There are many approaches to how change is brought about in an organization.
According to Bamford and Forrester (2003), planned and emergent approaches to
change dominate the current state of literature in the organizational change context.
In the same line, Lewin (1946) conceived one of the first models of the organizational
change management process. For any change to happen, Lewin advocated that an
organization has to undergo three stages: unfreeze the status quo, implementing the
change, and refreezing the new status quo. Following this framework, many researchers
advanced Lewin’s Model into other change models with a more practical context
while holding on to the planned approach to change management. Those who advocate
for the emergent approach view change as dynamic in nature and assumptions (planned
approach) that organizations function under stable conditions and in a planned fashion
is inherently flawed (Bamford and Forrester, 2003).
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Table 2: Change Based on Rate of Occurrence
What is the
Change
Change Order/
Characteristic
Process of
Change
Examples of
Change
Remarks
Incremental
change
Continuous change: Change occurs Optimization, Designed to increase
Incremental change through a series reengineering, organization capacity
encompassing whole of step that is Modifications without incurring
organization.
continuous in to
existing significant change in
nature and no product line.
operating structures or
(Grundy,
– Smooth incremental
step prevailing for
process. The goal is to
1994; Burnes, change: Change is
a longer time
maximize stability to
2004; Senior, brought about in slow
duration
the nature of the
2002)
and predictable manner.
improvements being
– Bumpy incremental
made
in
the
change: Period of
organization.
peacefulness marked by
acceleration pace of
change
Tr a n s f o r m a t i o n a l Requires
or
Radical/
a New platform, Radical
change:
A
subsystem
of
New
strategy,
discontinuous
change
Discontinuous
fundamental
radical change involving shift from current Enterprise 2.0, often requires a long
Change
change in vision, mission belief, structure, modifications term vision and time
(Grundy,
and factors intrinsic to system
and leading to new period and the
1994; Luecke, self regardless of
practices. Often product line outcome is often
2003)
structure.
leading
to and market for creation of new
market, business and
massive changes organization.
customer for the
in
the
organization.
organization.
Source: Authors’ Findings through Literature Review
Proponents of the emergent approach suggest uncertainty within the internal and
external environment as important contextual variables that need to be considered
while planning change implementation strategies. Therefore, the backers of the
emergent approach consider them to be more practical than the planned approach.
However, the emergent approach to change has been criticized by scholars for lacking
diversity of technique (Wilson, 1992) and also for their skepticism to the planned
approach to change (Dawson, 1994). Since no two organizations are the same, situational
variables will decide on the structure and the performance of an organization (Dunphy
and Stace, 1993). Advocates of contingency approach argue that organizations should
consider implementing distinct change management strategies to obtain ‘optimal fit’ with
their corresponding business environment in which they operate. They further argue that
“planned and emergent approaches to change are not the only spectrum of change events”,
rather organizations should devise a contingent strategy tailor-made for itself instead of
choosing an approach that is “one best way for all.” Having said that, contingency theory
has been increasingly criticized as it assumes that organization and change agents do not
have control over situational and structural variables (Burnes, 1996).
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Lastly, change characterized by the psychological nature and interrelationship
between the members in a department marks the evolution of project change
management models (see Table 3). These models are related to introducing changes
in an organization through projects, which means a temporary undertaking aimed at
creating a unique product or service. Such projects are marked by a beginning and an
end, interspaced with few systematic steps in the middle. Theoretically, such projects
involve fewer steps, less workload, and are easier to introduce in an organization. The
focus of this approach is to build an atmosphere of trust, relationship, and knowledge
sharing among the members of the department in which the change project is being
implemented (Highsmith, 2009; and Kerzner, 2017). The essences of managing change
in projects lie in managers’ leadership skills, which focuses not just on employee
competencies but also on employee relationships that promote an atmosphere of
knowledge sharing and problem-solving attitude necessary for change implementation.
Some of the prominent types of change are enumerated below.
Table 3: Change Characterized Through Implementation
Type of Change
Burnes Dunphy and
(1996) Stacy(1993)
Senior Kotter Lewin Kerzner Highsmith
(2002) (1995) (1946) (2004)
(2009)
Planned
Emergent
Contingent choice
Project management
Source: Authors’ Analysis
Change Characterized By Scale
According to Amis, Slack, and Hinings (2004), the scale of change refers to the
“degree of change required to reach a specific and desired outcome”. In the same
line, Oldham (2009) defined large scale change as “holistic alteration to processes and
behavior across organizational systems to obtain a significant level of desired output.”
For such a scale of change to succeed, organizations need strong leadership as well as
the collaboration of all stakeholders in the change implementation process (Boyd, 2009;
and Margolis, DeWalt, Simon, Horowitz, Scoville, Kahn and Miles, 2010). Additionally,
for implementing large scale changes, Stock (1993) suggested a holistic strategy, keeping
in mind the alignment between specific departmental/unit cultures with overall needs
and culture of the organization. Dunphy and Stace (1993) classified large scale corporate
change into four different categories: fine-tuning, incremental adjustment, modular
transformation, and corporate transformation. Fine-tuning or convergent change refers
to on-going organizational change that aims to assimilate an organization’s strategy with
its people, processes and structure (Nelson, 2003). This type of change helps in developing
managers and specialists at the departmental or unit level of the organization and also
helps increase volume, reduce cost, and improve quality.
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Incremental adjustment involves specific alterations in the ongoing management
practices and existing organizational strategies for change. However, this approach is
not analogous to large scale or radical change. On the other hand, modular
transformation can be radical and is generally identified with major shifts in one or
several departments or divisions at the same time but not on the whole organization
(Senior, 2002). Finally, corporate transformations are characterized by significant
corporate-wide modifications in the business strategy (Dunphy and Stace, 1993).
Examples of such a change include reorganization, restructuring, reformed policies,
mission, and vision (Burke and Litwin, 1992). In particular, scale of change interspersed
with the right management style such as directive, collaborative, coercive, or
consultative will help organizations to create an optimal fit for required corporate
performance. On the contrary, small scale changes involve minor and less significant
changes taking place within the organization. Such changes are relatively easier to
implement, and does not require significant leadership capabilities as in the case of
large scale changes (Boga and Ensari, 2009). Finally, as Berwick and Nolan (1998)
suggested, small scale changes are a better approach for organizations when it comes
to evaluating, modifying and implementing quality improvement projects on a pilot
basis.
INDUSTRY ANALYSIS: THE FOUR TRAJECTORIES OF CHANGE
Traditionally, strategy theorists and change practitioners have used firms as the unit
of analysis to ascertain and embrace change measures in the organization (Ansoff,
1968). Nevertheless, with the introduction of industry-level concepts of change, the
level of analysis tends to revert from the organization level to industry level (McGee
and Thomas, 1986). No same innovation or change strategy works for all organizations
in an industry. However, by analyzing change occurring within the industry, enterprises
can reasonably ascertain which strategies will eventually succeed or fail.
According to McGahan (2004), the threat to obsolescence is derived from two
main threads: industry core activities and industry core assets. While core activities
include traditional business modes that have garnered profit for the firms, core assets
include the organization’s resources, knowledge, and brand capital. Threats to core
activities arise when traditional profit-making activities/modes become irrelevant to
supply chain partners and customers. For e.g., in the auto industry, traditional sales
channel through dealership models are less valued today as customers have more
access to information through data available online. Whereas any threat to core assets
may lead to dilution of core competencies, that once made an organization unique
and successful. For example, in the pharmaceutical industry, the development of new
drugs and patent expirations are threatening blockbuster drugs, which were once
generating the most value for established pharmaceutical firms. Based upon these two
threats, an industry may face one or more of the four types of change trajectories.
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These trajectories include radical change, creative change, intermediating change,
and progressive change. From the organizational standpoint, it is important that firms
co-align their strategic actions with the business environment that reflect the nature
of industry-level changes for better firm performance.
In light of our summary review and understanding of organizational change literature
so far, we extend the model of McGahan (2004) of the industry change process to
propose a theoretical framework on strategies that organizations need to follow in
order to deal with industry-level changes (see Figure 3). According to McGahan
(2004), an industry is identified on the trajectory of creative change when its core
assets are threatened, but core activities remain stable. Innovation under creative
change occurs in fit and starts. For example, the motion picture industry falls under
the trajectory of such industry change. Overall, the customer and supplier relationships
are stable, but there is constant turnover of assets. At the organizational level, companies
that fall under the purview of such industry change trajectory may follow incremental
change (Burnes, 2004), which can be either smooth or bumpy (Grundy, 1994)
depending upon specific industry characteristics.
On the other hand, when industry core assets and core activities undergo threat of
obsolescence, in such a case, an industry can be construed as following a path of
radical change. This concept is close to the concept of disruptive change. An industry
experiencing disruptive change is entirely transformed but not overnight. Organizations
under the purview of such industry change may adopt a ‘prospector’ innovation strategy
(Miles, Snow, Meyer, and Coleman, 1978), implying that firms engage in the
identification and exploration of new product and market opportunities. For e.g., many
typewriter makers attempted to shift to personal computer manufacturing business
while responding to emerging trends and demands of the users, thus transforming one
whole industry (Paju and Haigh, 2016). However, the good news about disruptive
change is that, firms tend to remain profitable for a long time.
The other two trajectories: intermediating and progressive change have received
scant attention in management literature so far. Intermediating change occurs when
core activities are threatened, but core assets remain stable. Such type of change in
an industry is the most difficult one to manage for companies. Organizations facing
intermediating change in the industry must find unconventional and radical ways to
extract value from their core assets or resources and leverage them against threats
from competitors. A typical example of intermediating change includes an automobile
dealership and investment brokerage business. At the organizational level, firms
following such trajectories of industry change may opt for a radical change initially,
followed by incremental changes to maintain the fragile relationship among its core
activities. This type of strategy or innovation is similar to the ‘analyzer’ category of
Miles, Snow, Meyer, and Coleman (1978) typology as the emphasis is initially on
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RETHINKING ORGANIZATIONAL CHANGE: TOWARDS A CONCEPTUAL FRAMEWORK
flexibility to tap new opportunities and later bring stability while responding to
competitors and changes in the external environment (Parnell and Wright, 1993).
Lastly, progressive change follows a trajectory of relative stability since both the core
assets as well as the core activities are not threatened. Most industry elements do not
have an incentive to change and, therefore, do not change the status quo. Companies
under this trajectory of industry change focus on building resources and capabilities on
an incremental basis. In other words, under progressive change trajectory, organizations
follow an incremental change strategy that is generally smooth in nature. Companies
may adopt a ‘defender’ strategy (Miles, Snow, Meyer, and Coleman, 1978) while dealing
with such industry-level changes as the business environment is relatively stable, and
focus on operational control for achieving maximum efficiency. Examples of such industry
include commercial airline industry, long haul trucking and online auction industry.
Figure 3: Trajectories of Industry Change
Core Activities
Threatened
Not Threatened
Threatened
Creative Change
Everything is up in the air. Drastic The industry is constantly redeveloping
changes are implemented
assets and resources.
Industry Type: Travel industry, makers Industry Type: Motion picture industry,
of landline telephone handset.
investment banking
Organizational Change Process: Organizational Change Process:
Radical/ discontinuous change
Incremental change can be both smooth
and bumpy
Intermediating Change
Not Threatened
Core Assets
Radical Change
Progressive Change
Relationships are fragile. e.g., Supply Companies implement incremental
chain management.
change after feedback
Industry Type: Automobile dealership
Industry Type: Commercial airline,
Online auction
Organizational Change Process:
Radical change in the beginning, Organizational Change Process:
Smooth incremental change
followed by incremental change.
Source: Adapted and modified from McGahan (2004)
As discussed and can be inferred from the preceding sections, it is evident that
each firm’s strategy is idiosyncratic which researchers need to identify in order to map
the linkages between strategic choices and process fit between organization and its
constituent variables. In sum, we propose that one can meaningfully add the context
of industry level changes while forming new change implementation models within an
organization, in other words by analyzing the trajectory of industry change, organizations
can map their internal change initiatives and create actionable insights specifically
tailor made for handling contingent situations owing to industry level changes.
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DISCUSSION AND CONCLUSION
Successful organizations manage change efficiently. The question here is not whether
organizations need to change, but rather how fast and resilient organizations are while
managing such change. Thus, change has become one of the most interesting topics
of research for both academicians as well as change practitioners. So far, the nature of
change research has been quite broad; however, there is a need for funnelling and
exploring new context submerged in the literature of organizational change. In our
study, we have proposed a conceptual framework incorporating the macro environment
(industry-level changes) with organization-level changes that not only adds a new
meaningful context to the existing literature on change but also help practitioners
build a more balanced approach to change management. In particular, we posit that
organizations stand to benefit more by considering strategies and changes that reflect
changes at the macro-level (industry level). Leaders and change agents need to perform
the boundary spanning role for inculcating change strategies within firms that
acknowledge the new trends and pace of innovation in the industry. Such a proactive
approach on the part of management will help organizations adopt change better and
with greater assurance while dealing with competitors in the industry.
The findings and suggestions in the study are also useful for small scale units in the
Micro, Small and Medium Enterprise (MSME) segment. Small firms lack resources
and stand at a greater risk of failure, especially in the industries which exhibit radical
changes. Entrepreneurs in MSME units need to be vigilant and respond with innovative
strategies that reflect a balance between organizational and industry level changes for
surviving in the long run. For example, large firms with greater resources generally
lead with innovations that drastically change an industry’s operating landscape
(Freixanet, Rialp and Churakova, 2020). Other firms, including small scale units,
may adopt a mimetic and normative strategy for instituting the newfound innovation
and trajectory of the industry level change while managing their businesses (Zhang
and Hu, 2017). Similarly, if the rate of change within the industry is high, firms may
resort to an continuous incremental organizational change strategy to match the
industry’s competitors. Similarly, in case of large scale change within the industry,
firms may resort to a combination of radical change at the beginning, followed by
incremental change strategy for coping with such changes in the industry. In sum, the
proposed theoretical model of organizational change strategies reflecting the industry’s
trajectory of change acts as a vital cog for managing organizational change within all
sorts of firms, irrespective of their size and position in the industry.
LIMITATIONS AND FUTURE SCOPE OF THE STUDY
In our paper, we have highlighted the importance of organizational change strategies
that underscores the need to imbibe industry-level changes post the era of liberalization,
privatization, and globalization. While the paper’s thrust was to unravel new contexts
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for organizational change management, it is also important to understand factors that
inhibit organizational change at the macro level. Currently, our understanding of
constraints that operate at the industry level is rather narrow. Studies in the future
could relate factors that impede organizational readiness to change at the industry
level. In the same thread, we believe organizations can tap into the informal network
within the organizations to seek novel ways of mitigating resistance towards change
initiatives. Future researchers can examine the importance of adding the industry life
cycle to the present context of industry change and its impact on organizational change
to ascertain and validate the findings of this study.
Similarly, inter and intra-firm linkages within the industry may also affect the
trajectories of industry change as well as organizational change management strategies.
Future studies can undertake research that reflects organizational change strategies
by implicating the pros and cons of inter organizational linkages through cooperation
and collaboration. Lastly, most of the studies in the organizational change management
domain have been undertaken within the large firm context. Thus researchers would
do well to undertake empirical studies that reflect firm-level change management
strategies vis-a-vis industry-level changes within the small firms context. In sum, we
believe that the present study adds a new meaningful context to the existing change
management literature while we hope to have piqued the interest of strategy and
HRM scholars for refining the study’s findings.
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RETHINKING ORGANIZATIONAL CHANGE: TOWARDS A CONCEPTUAL FRAMEWORK
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