Fundamentals of Changing an Organization
Thus far, the discussion in this “Organizing” section of the text has centered on the fundamentals of organizing; on authority, delegation, and responsibility; and on furnishing appropriate human resources for the organization. This chapter focuses on changing the organization.
Defining Changing an Organization
Changing an organization is the process of modifying an existing organization to increase organizational effectiveness—that is, the extent to which an organization accomplishes its objectives. These modifications can involve virtually any organizational segment, but they typically affect the lines of organizational authority, the levels of responsibility held by various organization members, and the established lines of organizational communication. Driven by new technology, expanding global opportunities, and the trend toward organizational streamlining, almost all modern organizations are changing in some way.2
The Importance of Change
Most managers agree that if an organization is to thrive, it must change continually in response to significant developments in the environment, such as changing customer needs, technological breakthroughs, and new government regulations. The study of organizational change is extremely important because managers at all organizational levels are faced throughout their careers with the task of changing their organizations. Managers who can determine appropriate changes and then implement such changes successfully enable their organizations to be more flexible and innovative.3 Because change is such a fundamental part of organizational existence, such managers are valuable to organizations of all kinds.4
Many managers consider change to be so critical to organizational success that they encourage employees to continually search for areas in which beneficial changes can be made. To take a classic example, General Motors has traditionally provided employees with a “think list” to encourage them to develop ideas for organizational change and to remind them that change is vital to the continued success of GM. The think list contains the following questions:5
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Can a machine be used to do a better or faster job?
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Can the fixture now in use be improved?
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Can handling of materials for the machine be improved?
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Can a special tool be used to combine the operations?
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Can the quality of the part being produced be improved by changing the sequence of the operation?
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Can the material used be cut or trimmed differently for greater economy or efficiency?
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Can the operation be made safer?
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Can paperwork regarding this job be eliminated?
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Can established procedures be simplified?
The recent changes at GM—brought about by its financial collapse, bankruptcy filing, and subsequent bailout by the U.S. government—demonstrate that organizations sometimes need to take radical steps to restructure, or “reengineer,” their operations in order to stay in business.6
Change Versus Stability
In addition to organizational change, some degree of stability is a prerequisite for long-term organizational success. Figure 11.1 presents a model developed by Hellriegel and Slocum that shows the relative importance of change and stability to organizational survival. Although these authors use the word adaptation in their model rather than change, the two terms are essentially synonymous.
Figure 11.1 Adaptation, stability, and organizational survival
The model stresses that organizational survival and growth are most probable when both stability and adaptation are high within the organization (number 3 on the model depicted in Figure 11.1). The organization without enough stability to complement change is at a definite disadvantage. When stability is low, the probability of organizational survival and growth declines. Change after change without regard for the essential role of stability typically results in confusion and employee stress.7