Change management

The global business environment is changing faster than ever. We are living in an era where businesses constantly need to reshape their ideas merely to survive. But to achieve sustained success it is not sufficient merely to manage existing operations better, businesses need to do things radically different to secure an advantage over their competitors. Thus, in the future, we shall need to focus …not on restructuring the organisation but on transforming it. (Carnall, 2003, p14)

The literature that has been reviewed intimates the learning organisation is an organisation able to keep up with the changing business environment. In transforming an organisation to a learning organisation, a change process is necessary, so that the disciplines of a learning organisation can be developed (Henderson, 1997). In order for organisations to become learning organisations, their leaders need to be the forerunners of this change process. Before embarking on developing a learning organisation, leaders need to “recognise the need for change and to persuade other key people in the organisation to understand the seriousness for the need for change” (Viljoen & Klopper, 2001, p52). The need for change has to affect both the head (cognitive) and the heart (emotions) of organisation members – they should see the benefits of the change as well as be touched by it (Kets De Vries, 2001). There should also be an awareness of the process of change, how change is resisted and how to overcome the resistance to change at an individual and organisational level so that “by applying the insights derived from individual change to the domain of organisational transformation, we can induce, facilitate, and even speed up organisational change” (Kets De Vries, 2001).

Various models of the change process exist, namely the incremental model, where “change takes place through successive limited and negotiated shifts” (Coldwell, Williamson &

Cameron, 2007, p124); the punctuated equilibrium model where organisations experience “short periods of radical change followed by long periods of stability” (Coldwell et al, 2007, p124);

and the continuous transformation model that suggests that organisations need to be in a continuous state of change and have the capacity to regularly and fundamentally change in order

to survive (Coldwell et al, 2007). Senge’s model appears to be a continuous transformation model and he suggests that the “learning disciplines flourish more readily in organisations undergoing organic change compared with those undergoing driven change” (Senge et al, 1994, p121). However, Senge has also stated that there is no one-size-fits-all approach to developing a learning organisation as “everyone’s needs are different” (Senge et al, 1994, p15) and in introducing the five disciplines, “it’s difficult to practice all five disciplines…at once” (Senge et al, 1994, p77) and so a serial progression is recommended, starting with systems thinking. A study conducted by Coldwell et al (2007, p133) has, however, suggested that forced change, rather than organic change, using the punctuated-equilibrium change model, may “increase the perceived awareness of the importance of these disciplines in generating effective work outcomes”.

The model that is used to introduce the learning disciplines to an organisation is not as important as the type of approach that is taken – a human-centred approach is essential, with less focus on the technical aspects of change (Lee et al, 2000). Table 4.5 summarises such a human-centred approach to organisational change that can be used with the corresponding steps of the individual change process which may be experienced during each stage. These stages may not necessarily correspond as indicated, but do give an indication of what can be expected at the different stages. The introduction of a learning discipline is suggested for each stage, starting with systems thinking (as suggested by Senge et al, 1994), so as to build a learning organisation throughout the change process.

Table 4.5: The change process at an organisational, individual and learning discipline level

Stage Organisational change Individual change Learning discipline to be introduced

1 Awareness of change process Concern Systems thinking

2 Creating a shared mindset Confrontation Building shared vision

3 Changing behaviour Clarification Mental models

4 Building competencies, practices, attitudes Crystallization Personal mastery

5 Improving business performance Change Team learning

Adapted from Kets De Vries (2001).

In stage 1 when organisation members become aware of the change process, at an individual level they may experience concern. It would be worthwhile to introduce the discipline of systems thinking during this stage so as to provide organisation members with the reasons for the change, relating the change to the inter-relatedness of the system. For example, a rationale

similar to the quotation by Carnall (2003) at the beginning of this section could be used to assist in allaying members’ concerns.

During stage 2 it is important for the organisation to create a shared mindset so as to overcome initial concern by devising a picture of the future. Developing a shared mindset assists organisation members to confront the change that is to take place. The discipline of building shared vision can be aptly introduced at this stage so that all organisation members participate in creating the future of the organisation they desire, encouraging buy-in to the change.

Stage 3 is a stage where self-examination and reflection takes place – the organisation looks at how to change its culture and practices, and individuals clarify the changes that are required of them. In order for these changes to be made, it is necessary for organisation members to examine their mental models and hidden assumptions so that they can embrace the changes they need to make, ensuring that they will not resort to old ways of doing things, that do not have a place in the learning organisation.

During stage 4, the organisation goes about changing and building competencies and practices and at that time individuals experience crystallization where they work through the changes they need to make and increase their self-knowledge. As such, this stage is well timed with introducing and supporting the discipline of personal mastery.

Stage 5 is where individuals accept the change and internalise changes they need to make, and business performance improves. By introducing the discipline of team learning, the organisation can further improve performance by sharing information and learning together.

As with all change processes, resistance to change is likely to be experienced, such as fear of the unknown, fear of lacking the skills to change, a perceived loss of freedom and the loss of alliances or friends (Kets De Vries, 2001). Other barriers (resistors) that further complicate a change process include a commitment to the status quo (the current way of being and doing things); structural barriers in the organisation that hinder the flow of information and its evaluation; political barriers with their underlying power relations, contributing to conflict and mistrust; behavioural barriers related to the mental models that people hold; and time constraints owing to demands on time to meet workload and the time required for a change process (Dess &

Picken, 2000).

The economic environment can also pose a barrier to change, especially in a small organisation – to prevent the possibility of having to re-enter the labour market, employees may build “a position of irreplaceability” (Macri, Tagliaventi & Bertolotti, 2002, p304) where they resist delegation, hold onto information and oppose participating in the transference of skills.

Organisational learning is required to develop a learning organisation (as discussed in Chapter Three) and in a stable organisation, where profit levels and market share are consistent, learning may only be localised and not across the organisation as there is no perceived need to learn and change to a learning organisation (Macri et al, 2002). The question then comes to mind, for a small organisation, what is the “right” economic environment to develop into a learning organisation? In difficult or stable economic times, there are likely to be resistors to change, contributing to the inertia experienced by small organisations to become learning ones. How this and other barriers to change can be overcome will now be explored.

Resistance to change can be overcome by, in addition to developing systems thinking, building support and systems that allow for change and using successes of the past to build a new vision for the future (Kets De Vries, 2001). These endeavours require the input of all organisation members to ensure that the change is sustained (Kets De Vries, 2001).

In order to challenge the status quo, leaders can create a sense of urgency by, for example, creating a convincing picture of the risks of not changing (Dess & Picken, 2000). Another way to overcome the status quo is through facilitating constructive dissent where, for example, employees are given the opportunity to openly question a leader’s perspective without fear of reprisal (Dess & Picken, 2000). However, this may be challenging in a small organisation that is owner-manager led, for reasons previously discussed. Risk-taking can be encouraged and when failures occur, these can be used as opportunities to learn (Dess & Picken, 2000). One again, within a small organisation, where mistakes may impact the bottom-line in a way that the organisation cannot absorb, risk-taking may be a strategy that needs to be carefully considered and planned for (Smit & Watkins, 2012). A strategy to overcome resistance to change that is likely to be successful in small organisations is to get everyone involved in the change, by encouraging ideas and rewarding efforts (Dess & Picken, 2000).

As there appears to be no ‘right (economic) time’ for a small organisation to engage in a change process to become a learning organisation, the impetus seems to be on the leader and his/her ability to motivate and communicate the change as being desirable and necessary (Macri et al, 2002). Macri et al (2002) highlight that the leader also needs to be aware of the emotional

intelligence of employees so as to gauge employees’ ability to change. The leader can use this information to guide them through the change process. Employees may also perceive it to be their role to resist change, as a type of self-fulfilling prophecy. This behaviour reiterates the importance of involving employees in the change process so as to minimise employees acting on their perceived role of resistor. A summary of barriers and strategies to overcome these is provided in Table 4.6.

Table 4.6: Barriers (resistors) to change and strategies to overcome these

Barrier to change Strategies to overcome barriers

Commitment to the status quo - Fear of the unknown

- Fear of lacking skills for change - Loss of freedom

Build support and systems for change

Create a sense of urgency

Facilitate constructive dissent

Encourage risk-taking

As a vessel that has undergone a process of changing the way things are done on board enters into new and unknown waters, the inclination may be for its crew to resort to previous ways of doing things. This is a natural response when one enters into unfamiliar territory – the tendency is to do things the way one has in the past, as new ways are not yet etched on one’s psyche. The process of change and its implementation needs to be sustained to overcome this obstacle. This sustained process applies to any vessel and in the context of a learning organisation, a sustained process will ensure that the learning disciplines continue to develop. The next section will describe how to develop the learning disciplines and will raise issues which may arise in developing a learning organisation.