Summary Organizational Change
Chapter 1 – Organizations and their changing environments
Watson: common factor of organizations are the goals which act as a glue holding together
the various systems used to produce things.
Organization’s environment = all those influences that may act to disturb organizational life
but are not directly part of it. According to Brooks: ‘a general concept which embraces the
totality of external environmental forces which may influence any aspect of organizational
activity’.
Daft: an organization:
1. is a social entity
2. has a purpose
3. has a boundary
4. patterns the activities of participants into a recognizable structure.
The concept of an organization is a system of interacting subsystems and components set
within wider systems and environments that provide inputs to the system and receive its
outputs.
Employee behaviour and job satisfaction are particularly relevant to the informal subsystem.
Stacey: organizations as complex systems emphasize the notion of unpredictability by
emphasizing the multitude of interactions in and between the individual, social, organizational
and environmental domains.
Open systems organizations transform inputs into outputs and the strategies employed are
influenced by both historical and contemporary environmental demands, opportunities and
constraints.
Value-oriented time (Goodman): organizations must find products and services that are
differentiated by purpose, form and the ‘added value’. Identifying potential customer
expectations and exceeding them. Production gets more responsive to customer demand.
Knowledge has become increasingly important will improve competitiveness.
Different constructions from companies about the environment arise from the following:
Characteristics and experiences of people filtering information from the environment
Organization culture
Organizational politics and structures
How the organization has developed in the past
How the business sector as a whole interprets the information
Environmental factors PESTLE: Political, Economic, Social, Technological, Legal and
Ecological.
,Political factors: government legislations, government ideology, international law, universal
rights, wars, local regulations, taxation, trades union activities.
Economic factors: competitors, suppliers, currency exchange rates, employment rates, wage
rates, government economic policies, other countries’ economic policies.
Socio-cultural factors: demographic trends, lifestyle changes, skills availability, attitudes to
work and employment, attitudes to minority groups, gender issues, willingness to move.
Technological factors: information technology, new production processes, computerization of
processes, changes in transport technology.
Political and economic environments are closely related since political decisions shape
economic fortunes and economic changes influence political decisions. Governments in
developed countries at least work to keep four key economic indicators in balance (Cook):
Increasing output of goods and services; economic growth
Healthy balance of payments
Low inflation
Low unemployment
Examples of how changes in the socio-cultural environment influence attitudes to work and
trigger changes are:
Expectations for continuous increases in the standard of living
Demographic changes such as the age composition of the workforce
Changes in family structures and the roles of men and women
The technologies that organizations use affect how they decide their structure for optimum
efficiency. They affect the knowledge and skills that employers want and which employees
need and lead to retraining and career change.
Indicative internal triggers for change:
Decisions to recognize or not recognize a union
A new CEO of other senior manager
Realization that operating structures are performing poorly
The redesign of jobs and working relationships among a work group
S&S state that change is influenced by:
1. Temporal environment = an environment that influences organizations in two ways, a
general way and a more specific way. General way goes through the cycles of industry-based
innovation and the more specific way goes through the life cycle of the organization itself.
2. PEST framework environment
3. Internal environment = formal and informal subsystems
4. History = what you are is determining what you can be/determines change
, Ansoff and McDonnel state that a firm’s performance is optimized when its aggressiveness
and responsiveness match its environments. They propose five levels of environmental
turbulence:
1. Predictable. A repetitive environment characterized by stability of markets; challenges
repeat themselves; change is slower than the organizations ability to respond; future is
expected to be the same as the past.
2. Forecastable by extrapolation. Complexity increases but managers can still extrapolate
from the past and forecast the future with confidence.
3. Predicatble threats and opportunities. Complexity increases further when the
organizations ability to respond becomes more problematic; future can still be
predicted
4. Partially predictable opportunities. Turbulence increases with the addition of global
and socio-political changes. The future is only partly predictable.
5. Unpredictable surprises. Turbulence increases further with unexpected events and
situations occurring more quickly than the organization can respond.
Two issues concerning turbulence: predictability and available time for change.
Stacey proposed three different kinds of change situations:
1. Closed change: able to say what happened, why it happened, and what the
consequences are. We are also able to explain that such a sequence of events and
actions will continue to affect the future course of the business. Closed change would
apply to the continuing operation of an existing business.
2. Contained change: able to say what probably happened, why it probably happened,
and what its probable consequences were. Future qualified by probability statements.
3. Open-ended change: far from certainty; what a team of managers does next to deal
with low profitability obviously depends upon the explanation of past failure they
subscribe to.
Chapter 2 – The nature of organizational change
It is important for organizations to strike a balance between both the forces for stability and
inertia and the forces for change.
Dunphy and Stace – Organizational approaches to change, based on characteristics:
Chapter 1 – Organizations and their changing environments
Watson: common factor of organizations are the goals which act as a glue holding together
the various systems used to produce things.
Organization’s environment = all those influences that may act to disturb organizational life
but are not directly part of it. According to Brooks: ‘a general concept which embraces the
totality of external environmental forces which may influence any aspect of organizational
activity’.
Daft: an organization:
1. is a social entity
2. has a purpose
3. has a boundary
4. patterns the activities of participants into a recognizable structure.
The concept of an organization is a system of interacting subsystems and components set
within wider systems and environments that provide inputs to the system and receive its
outputs.
Employee behaviour and job satisfaction are particularly relevant to the informal subsystem.
Stacey: organizations as complex systems emphasize the notion of unpredictability by
emphasizing the multitude of interactions in and between the individual, social, organizational
and environmental domains.
Open systems organizations transform inputs into outputs and the strategies employed are
influenced by both historical and contemporary environmental demands, opportunities and
constraints.
Value-oriented time (Goodman): organizations must find products and services that are
differentiated by purpose, form and the ‘added value’. Identifying potential customer
expectations and exceeding them. Production gets more responsive to customer demand.
Knowledge has become increasingly important will improve competitiveness.
Different constructions from companies about the environment arise from the following:
Characteristics and experiences of people filtering information from the environment
Organization culture
Organizational politics and structures
How the organization has developed in the past
How the business sector as a whole interprets the information
Environmental factors PESTLE: Political, Economic, Social, Technological, Legal and
Ecological.
,Political factors: government legislations, government ideology, international law, universal
rights, wars, local regulations, taxation, trades union activities.
Economic factors: competitors, suppliers, currency exchange rates, employment rates, wage
rates, government economic policies, other countries’ economic policies.
Socio-cultural factors: demographic trends, lifestyle changes, skills availability, attitudes to
work and employment, attitudes to minority groups, gender issues, willingness to move.
Technological factors: information technology, new production processes, computerization of
processes, changes in transport technology.
Political and economic environments are closely related since political decisions shape
economic fortunes and economic changes influence political decisions. Governments in
developed countries at least work to keep four key economic indicators in balance (Cook):
Increasing output of goods and services; economic growth
Healthy balance of payments
Low inflation
Low unemployment
Examples of how changes in the socio-cultural environment influence attitudes to work and
trigger changes are:
Expectations for continuous increases in the standard of living
Demographic changes such as the age composition of the workforce
Changes in family structures and the roles of men and women
The technologies that organizations use affect how they decide their structure for optimum
efficiency. They affect the knowledge and skills that employers want and which employees
need and lead to retraining and career change.
Indicative internal triggers for change:
Decisions to recognize or not recognize a union
A new CEO of other senior manager
Realization that operating structures are performing poorly
The redesign of jobs and working relationships among a work group
S&S state that change is influenced by:
1. Temporal environment = an environment that influences organizations in two ways, a
general way and a more specific way. General way goes through the cycles of industry-based
innovation and the more specific way goes through the life cycle of the organization itself.
2. PEST framework environment
3. Internal environment = formal and informal subsystems
4. History = what you are is determining what you can be/determines change
, Ansoff and McDonnel state that a firm’s performance is optimized when its aggressiveness
and responsiveness match its environments. They propose five levels of environmental
turbulence:
1. Predictable. A repetitive environment characterized by stability of markets; challenges
repeat themselves; change is slower than the organizations ability to respond; future is
expected to be the same as the past.
2. Forecastable by extrapolation. Complexity increases but managers can still extrapolate
from the past and forecast the future with confidence.
3. Predicatble threats and opportunities. Complexity increases further when the
organizations ability to respond becomes more problematic; future can still be
predicted
4. Partially predictable opportunities. Turbulence increases with the addition of global
and socio-political changes. The future is only partly predictable.
5. Unpredictable surprises. Turbulence increases further with unexpected events and
situations occurring more quickly than the organization can respond.
Two issues concerning turbulence: predictability and available time for change.
Stacey proposed three different kinds of change situations:
1. Closed change: able to say what happened, why it happened, and what the
consequences are. We are also able to explain that such a sequence of events and
actions will continue to affect the future course of the business. Closed change would
apply to the continuing operation of an existing business.
2. Contained change: able to say what probably happened, why it probably happened,
and what its probable consequences were. Future qualified by probability statements.
3. Open-ended change: far from certainty; what a team of managers does next to deal
with low profitability obviously depends upon the explanation of past failure they
subscribe to.
Chapter 2 – The nature of organizational change
It is important for organizations to strike a balance between both the forces for stability and
inertia and the forces for change.
Dunphy and Stace – Organizational approaches to change, based on characteristics:
