Building Organisational Resilience

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Building Organisational Resilience

  1. 1. LEADING AND MANAGING PEOPLE IN CHAOS AND COMPLEXITY Building Organisational Resilience A model for building change readinessthrough appropriate organisational culture Atul Kuver th 25 February 2011 1© Atul Kuver 2011
  2. 2. EXECUTIVE SUMMARYThe purpose of this study was to develop a ’fit-for-purpose’ model (Figure I) to buildchange readiness through organisational culture. The model was established througha resource-based view of the organisational culture and practices that assist changereadiness, sustainable people management practices, and the capacity to implementchange to deal with business sustainability challenges. Figure I. Model to build change readiness through organisational culture.A Defence Business (ADB) is one of the world’s largest defence contractors. Itscustomers include armed forces of countries around the world, government agenciesand defence and aerospace prime contractors and the business has strong presencein the UK, USA and Australia. This report concerns one of ADB’s smaller operations(referred to as ‘Div A’) located in South Australia. ADB needs to address severalissues affecting Div A in delivering more sustainable business practices. Div A’s issues 2© Atul Kuver 2011
  3. 3. concern commercial and social sustainability. These issues require changes at ADBand Div A will be affected. The change readiness model developed and described inthis report is aimed at building Div A’s readiness for change through its culture. Themodel explores the gap between the preparation and action stages of the changeprocess to provide a framework with which to reduce this gap to a level wherecontinuous change is accepted.The report examines the concept of change readiness to establish links betweenchange readiness and organisational culture. The model treats the organisation, itsculture and the individual employees as an integrated and interconnected system. Ituses the concept of organisational resilience, and focuses on building changereadiness and organisational resilience through cultural resilience. 3© Atul Kuver 2011
  4. 4. Table of ContentsEXECUTIVE SUMMARY ............................................................................................... 21 INTRODUCTION ................................................................................................. 52 THE CONCEPT OF CHANGE READINESS .............................................................. 73 CHANGE CHALLENGES AT ADB ........................................................................... 8 3.1 Business Overview ...................................................................................... 8 3.2 Change Challenges to Deliver More Sustainable Business Practices ............. 8 3.3 The Issues.................................................................................................. 104 THE MODEL: BUILDING CHANGE READINESS THROUGH APPROPRIATEORGANISATIONAL CULTURE .................................................................................... 11 4.1 Structure, Components and Elements of the Model. ................................. 12 4.1.1 ‘Means – Ends’ Structure.................................................................... 13 4.2 Individual .................................................................................................. 14 4.2.1 Perception.......................................................................................... 14 4.2.2 Personal Valence ................................................................................ 15 4.2.3 Motivation ......................................................................................... 15 4.2.4 Self-Efficacy ........................................................................................ 16 4.2.5 Uncertainty ........................................................................................ 16 4.3 Culture ...................................................................................................... 17 4.3.1 Innovation, Risk-Taking, Learning Opportunities and Flexibility .......... 17 4.3.2 Resilience ........................................................................................... 18 4.3.3 Momentum ........................................................................................ 19 4.3.4 Change Valence and Change Efficacy.................................................. 19 4.4 Organisation .............................................................................................. 20 4.4.1 Information ........................................................................................ 21 4.4.2 Responsible Leadership ...................................................................... 215 FITNESS OF THE MODEL FOR USE BY ADB CHANGE AGENTS ............................ 246 CONCLUSION ................................................................................................... 25REFERENCES ............................................................................................................ 27 4© Atul Kuver 2011
  5. 5. 1 INTRODUCTIONSocial, economic, political, or competitive factors are usually the initiators oforganisational change. Champoux (2011) suggests that modern organisations arechallenged with concurrent demands for change and stability. Organisations do notappear to have the option of reacting to the forces of change that originateexternally or from within. Linear models of cause and effect no longer seem to apply.Change management is also probably one of the most challenging issues formanagers in modern organisations. In most cases, there are usually two distinctgroups — those that want to proceed with change and those who feel they will beworse off after the change.This study has developed a model for building change readiness through appropriateorganisational culture. The notion of change readiness can be considered to be theextent to which individuals in an organisation hold a positive outlook about thenecessity for organisational change as well as the extent to which the change willbenefit themselves and the organisation (Jones et al. 2005).The model is established through a resource-based view of the organisational cultureand practices that assist change readiness, sustainable people managementpractices and the capacity to implement change to deal with business sustainabilitychallenges. The resource-based view of an organisation sees the organisation ashaving a unique set of resources and capabilities that gives rise to the concept ofcompetitive advantage.Organisational culture includes ‘values, norms, rites, rituals, ceremonies, heroes,and scoundrels in the organization’s history’ (Champoux 2011, p. 73). Thisdescription is an expansion of Schein’s (cited in Jones et al. 2005, p. 363) threedimensional view of organisational culture consisting of:  assumptions — the taken-for-granted beliefs about human nature and the organisational environment; 5© Atul Kuver 2011
  6. 6.  values — the shared beliefs and rules that regulate the attitudes and behaviours of employees;  artefacts — the visible language, behaviours and material symbols within the organisation.These three dimensions provide a framework to examine an organisation’s changereadiness impediments and assist in identifying areas where improvements may bemade. In particular, values are seen to be central to understanding organisationalculture (Ott, cited in Jones et al. 2005, p. 363) and values can therefore beconsidered to be a reliable depiction of organisational culture (Howard, cited inJones et al. 2005, p. 363).Resilience has been discussed in terms of the individual (Bolton 2004; Coutu 2002).Bolton (2004, p. 60) describes resilience as ‘the capability of people to withstandhardship and, in facing adversity, to continue leading functional and healthy lives’. Inaddition to individual or employee resilience, Bolton (2004) points out that resiliencecan also exist at the organisational level and makes reference to ‘resilientorganisations’ (p. 61). Organisational resilience as discussed by Bolton (2004) seemsto be the result of resilient individuals.The model presented here uses the concept of organisational resilience and focuseson building change readiness through cultural resilience. In other words, a culture ofresilience should exist if an organisation is to be change ready.The following framework will be used to discuss the significance of this model inbuilding organisational resilience.Section 2 examines the concept of change readiness to establish links betweenchange readiness and organisational culture. The change challenges at the company‘A Defence Business (ADB)’ is discussed in Section 3, to learn about the types ofchange events the model may be required to address. The model —‘Building change 6© Atul Kuver 2011
  7. 7. readiness through appropriate organisational culture’ is presented in Section 4.Section 5 illustrates the fitness of the model for ADB’s change agents followed by theconclusion to this report in Section 6.2 THE CONCEPT OF CHANGE READINESSArmenakis and Harris (2007, p. 132) define readiness as the ‘cognitive precursor ofthe behaviors of resistance to or support for organizational change’. They prefer theterm readiness instead of resistance because in their view the term readiness ‘fitsbetter with a positive approach to framing change’ (Armenakis & Harris 2007, p.132). They found that individuals who were in the ready for change (contemplation)stage and the actively changing (action) stage were more open to the introduction ofa new leadership development program and there was an increased likelihood thatthe participants would positively evaluate its content and delivery (Harris & Cole2007, cited in Armenakis & Harris 2007, p. 132).Armenakis and Harris (2007, p. 129) identified five key change beliefs that appear toprovide reasons for the change recipient to support change initiatives. The beliefsare: 1. discrepancy — the belief that change is needed and this is reflected in the gap between the organisation’s present state and the state it wants to adopt; 2. appropriateness — the belief that a specific change designed to address the discrepancy is the correct action; 3. efficacy — the belief that the change recipient and organisation will successfully implement the change; 4. principal support — that leaders and managers within the organisation are committed to the success of the change; and 5. valence — the belief that the change is beneficial to the change recipient.Research suggests that readiness improves when change recipients can recognisethe need for change, sense their ability to successfully implement change (self- 7© Atul Kuver 2011
  8. 8. efficacy) and they are given the opportunity to participate in the change process(Cunningham et al. 2002, p. 377). Reshaping capabilities then become an importantfeature of an organisation’s ability to change and hence complements changereadiness. According to Beckard and Harris (cited in Jones et al. 2005, p. 367),change readiness concerns the motivation and willingness of participants andreshaping capabilities include the knowledge, skills, and abilities of the entireorganisation for successful change implementation.3 CHANGE CHALLENGES AT ADB3.1 Business OverviewA Defence Business (ADB) is one of the world’s largest defence contractors. Itscustomers include armed forces of countries around the world, government agenciesand defence and aerospace prime contractors. The business operates severalcountries including the UK, USA and Australia. The business has well establishedcustomer relationships by offering product through-life capability and long-termpartnerships with its customers. Project management and engineering are ADB’score competencies.3.2 Change Challenges to Deliver More Sustainable Business PracticesOver the past two decades, the defence industry has consolidated. This has resultedin fewer, larger defence organisations. The fifty largest defence businesses of theearly 1980s had now become the country’s top five defence contractors (Guay2007).In Australia, defence businesses focus on one customer — the Commonwealth ofAustralia. Major defence contractors with operations in Australia include Boeing,Raytheon, Lockheed-Martin, BAE Systems, Thales, and Australian SubmarineCorporation. Generally, the Australian operations are significantly smaller than those 8© Atul Kuver 2011
  9. 9. in the US or the UK. Smaller Australian defence subcontractors are often closelyaligned with the larger organisations to maintain sustainable businesses.While ADB is a major defence prime contractor, this report concerns one of itssmaller operations located in South Australia. This division of ADB (to be referred toas Div A) has approximately 200 employees at one of its South Australian sites.Building change readiness through appropriate culture will be focussed on this site.Div A is the result of an acquisition by ADB over a decade ago. Some culturalremnants from the previous business still exist but overall ADB has been verysuccessful in integrating Div A after acquisition.Smaller divisions within large corporations can be particularly vulnerable to change.These divisions are at risk of being labelled ‘out-posts’. The core competencies ofsuch a division need to be visible and highlighted. A small division sometimes needsto be run as an entirely different business to keep the division competitive. Div A,while allowed significant autonomy, is still bound by processes, procedures andpolicies of the global business. Many of these requirements were originally designedwith larger sections of the business in mind.The consolidation of business divisions has had a significant impact on Div A. Inrecent years, the division has undergone changes due to further acquisitions. Thesmall size of Div A means that it has had to cope with integration into other divisions.While Div A has seemed to cope well through these changes, there are signs that theon-going changes have had some negative effects on the division. Several managershave been transferred or their positions made redundant. Uncertainty due to theconstant changes seems to be on the rise. The diversion of the Commonwealth’sdefence budgets to the on-going operations in Iraq and Afghanistan and theperceived lack of work have made many employees nervous. The processes andpolicies that worked well for larger projects now seem rigid when applied to smallerones. This adds another level of cost to bids. Competitors who do not have the 9© Atul Kuver 2011
  10. 10. additional cost burden —mostly smaller more agile organisations — are able to out-bid ADB.ADB has responded. Project management procedures have been revised to allow‘tailoring’ of project processes. However, a major problem is that these changes arenot universal. While project procedures may have changed, other systems remainrigid — for example Configuration Management (CM) and Quality Assurance (QA).Both CM and QA are essential in maintaining product integrity and traceability so thereluctance in making any changes to these seems justifiable.3.3 The IssuesADB needs to address several issues towards delivering more sustainable businesspractices. Sustainability in this context is defined as the achievement of long termand integrated commercial, environmental and social outcomes. Div A’s issues areprimarily commercial and social. For,  commercial sustainability: o change procedures to allow Div A to become more competitive; o develop project agility; o maintain and recruit talent;  social sustainability: o improve employee morale; o maintain talent; o address uncertainty;These issues require changes at ADB. Div A in particular will be affected. The changereadiness model developed and described in this report is aimed at building Div A’sreadiness for change through its culture. The culture at Div A seems resilient andable to cope well with change. This model provides a framework to improve thiscapability and as a result improve the Div A’s readiness for change. 10© Atul Kuver 2011
  11. 11. 4 THE MODEL: BUILDING CHANGE READINESS THROUGH APPROPRIATE ORGANISATIONAL CULTURECoolican and Jackson (cited in Igo & Skitmore 2005, p. 123) believe thatorganisational culture today provides a framework that can be used to ‘implementand operationalize business strategies’. At the same time, organisational culture isacknowledged as being difficult to change (Bresnen & Marshall, cited in Igo &Skitmore 2005, p. 123).The change readiness model proposed by Armenakis and Harris (2007) intended tooffer change agents with the perspective of actions required to plan a programme toshape the five key beliefs which would then encourage change recipients topositively accept the change. This intention distinguishes their model from themodel presented here.The change readiness model described here explores the gap between thepreparation and action stages of the change process to provide a framework withwhich to reduce this gap to a level where continuous change is possible. This modelshould not be too dependent on external trigger and it should include continuouslyimproving change readiness within the organisation’s culture. This is done byemphasising that effective organisational change can be driven through appropriateorganisational culture and that the fundamental source of culture is the individualswho make up the organisation.In this model, low change readiness means the organisational culture permits orresponds to change with difficulty. High change readiness means the culture copeswell with change with minimum disruption to everyday operations. The aim of themodel shown in Figure 1 is to illustrate the development of change readinessthrough its culture. The structure, components and elements of the model will nowbe discussed. 11© Atul Kuver 2011
  12. 12. Figure 1. Illustration of the model to build change readiness through appropriate organisationalculture.4.1 Structure, Components and Elements of the Model.The model treats the organisation, its culture and the individual employees as anintegrated and interconnected system. It is difficult to view these three componentsas independent and unconnected. In this model, the Organisation is shown as thestructure within which Culture and Individuals are embedded. While it may bepossible to argue that the three components can be separated while keeping firmlinks between them, the separated model may not clearly represent the inter-dependent nature of the three parts. The assertion in this model is thatorganisational change is fundamentally supported from an individual level. Culturethen provides the momentum and resilience needed for heightened changereadiness. 12© Atul Kuver 2011
  13. 13. The following terms will be used to describe the model:  elements —the basic building blocks and desired outcomes. Elements are embedded within the models components;  components — the model has three components: Organisation, Culture and Individual; and  structure — represents the overall model framework and refers to the arrangement of the components, elements and their associated inter- dependencies.4.1.1 ‘Means – Ends’ StructureThe illustrated model shown in Figure 1 is based on a ‘means – ends’ structure. The‘means’ are the concepts and frameworks that should be considered as ways ofbuilding change readiness. Means are shown on the left half of the illustration. The‘ends’ are the expected outcomes. Ends are shown on the right half of theillustration. All means and ends are elements within the model. The individual oremployee is located in the centre of the illustration. This is in line with thephilosophy used to develop this model – that the individual is at the crux of theorganisation. 13© Atul Kuver 2011
  14. 14. 4.2 IndividualIn this model, five key elements for change readiness development in individuals areconsidered. The key elements are:  Perception  Motivation  Personal Valence  Uncertainty  Self-efficacyAlthough Figure 1 shows these as separate elements within the structure of theIndividual, in reality these elements may be interconnected and stimulating oneelement may affect others. In order to make sense of the impact of the elements, itis simpler to view each in isolation. This method provides a framework that can thenbe used to create associations and linkages based on the organisation’s uniquecircumstances.4.2.1 PerceptionAccording to Eby (2000, p. 420), the perceptions of employees about whether theorganisation is ready for change is an important aspect in recognising sources ofresistance to change. Perception then becomes an important element in two ways —first, as a driver of change readiness and secondly as a predictor of change readiness.While perception may be improved through information and leadership to improvechange readiness, using it as a predictor of change readiness is more difficult. Eby(2000, p. 422) proposes that perceptions of change readiness are dependent on an‘individual’s unique interpretation of the organisation’s context’. This makesperception a subjective concept as there is no standard against which it can bemeasured. 14© Atul Kuver 2011
  15. 15. In this model, the primary purpose of the perception element is its use as a driver toincrease the individual’s change readiness.4.2.2 Personal ValencePersonal valence is the belief that the change is beneficial to the employee. Whenthe individual goes through the process of establishing personal valence, he or sheencounters decisional balance. Decisional balance refers to the expected risks ofchange versus the likely benefits of change (Cunningham et al. 2002). Theindividual’s perceptions of the benefits of change compared to the risks of failing tochange start the process of readiness for change (Cunningham et al. 2002).Armenakis and Harris (2007) emphasised the impact of change recipient involvementand participation on enhancing personal valence. Participation allows individual toseek solutions to difficulties they face and improves efficacy by allowing them toselect those changes they feel they can accomplish (Armenakis & Harris 2007, p.130). While participation seems simple in concept, it may in fact prove to be difficultin practice. Leaders must also take into account the inter-dependent and complexnature of an individual employee. Individual-to-individual, individual-to-culture, andindividual-to-organisation relationships and dependencies are not always clear intoday’s complex business environment.4.2.3 MotivationGottschalg and Zollo (2007, p. 420) suggest that individuals’ motivation to behave incertain ways are determined by the extent to which the behaviour assists them inmeeting their goals and the relevance of each goal to the individual. They use athree-category taxonomy to capture the primary differences between the meansthrough which organisations can encourage motivation. The three categories are:  extrinsic motivation —is driven by the objective of achieving extrinsic work related rewards such as money, power and recognition; 15© Atul Kuver 2011
  16. 16.  hedonic intrinsic motivation — is driven through engagement in ‘enjoyable, self-determined and performance competence-enhancing behaviour’; and  normative intrinsic motivation — is driven through engagement in behaviour compliant with organisation norms and values. (Gottschalg & Zollo 2007, p. 420)The model illustrates that while extrinsic and hedonic intrinsic motivation may beencouraged from an organisational level, normative intrinsic motivation is moreclosely related to organisational culture.4.2.4 Self-EfficacyAn individual’s perceived ability to successfully manage the change —self-efficacy —has the effect of mediating individual readiness (Prochaska et al. 1997, cited inCunningham et al. 2002, p. 378) and organisational change (Armenakis et al. 1993,cited in Cunningham et al. 2002, p. 378). Confidence in one’s ability to cope withchange is more likely to contribute positively to organisational change. Change maybe resisted if individuals perceive that the process exceeds their ability to cope(Armenakis et al. 1993, cited in Cunningham et al. 2002, p. 379). In Cunningham etal.’s (2002) study, workers with an active approach to work issues were moreconfident in their coping ability regarding job change and demonstrated a higherreadiness for organisational change.4.2.5 UncertaintyMilliken (cited in Bordia et al. 2004, p. 508) defines uncertainty as ‘an individual’sinability to predict something accurately’. Uncertainty evolves due to lack of orambiguous and contradictory information (Berger & Calabrese, Putnam & Sorensoncited in Bordia et al. 2004, p. 508). Bordia et al. (2005, p. 508) characterisesuncertainty as an ‘aversive state’ that encourages responses which try and manageor reduce it. During organisational change, uncertainty is also one of the most 16© Atul Kuver 2011
  17. 17. commonly reported psychological states (Bordia et al 2005, p. 509). Perceivedresistance to change may just be an individual’s efforts to try and minimiseuncertainty.4.3 CultureChampoux (2011, p. 74) outlines seven key elements that describe organisationalculture. These elements are:  levels — culture has different degrees of visibility with core values being the least visible;  pervasiveness — culture is widely dispersed;  implicitness — veteran employees will often take core cultural values for granted;  imprinting — culture is deeply rooted in the organisations history;  political — culture is connected to systems of power;  plurality — subcultures also exist;  interdependency — culture is interconnected with other parts of the organisation;One of the characteristics of this model is that Culture is represented as a ‘buffer’between the Organisation and the Individual. The resilience element is embeddedwithin this buffer region. While it could be argued that an organisation exerts directand uninterrupted influence over the individual, the ‘culture as a buffer’ stanceseems reasonable as a general representation of modern organisations.4.3.1 Innovation, Risk-Taking, Learning Opportunities and FlexibilityWeiner (2009, p. 4) recognised the broader contextual conditions that affect changereadiness. Four elements — innovation, risk-taking, learning opportunities andflexibility make up the means through which organisational culture can heighten itschange readiness. These elements have been chosen as the primary means ofbuilding change readiness because different levels of each element normally exist 17© Atul Kuver 2011
  18. 18. within many organisations. It is usually difficult to find a hard boundary separatingeach of these elements and in many cases dependencies will exist betweenelements.Jones et al. (2005, p. 365) identified that: 1. Employee perceptions that their organisation is dominant in human relations values and open systems values are more likely to possess positive views about organisational change — Flexibility; 2. Innovation and dynamic nature of open systems culture suggests that employees who perceive their organisational culture to be an open system are likely to hold positive views on change — Innovation/Flexibility; 3. Training and development of human resources may relate to an individual’s confidence and improve their ability to take on new challenges — Learning Opportunities;Studies that investigate the direct relationship between risk-taking and changereadiness seemed to be lacking. Nonetheless, risk-taking seems to be an importantelement when considered together with innovation, flexibility and learning. Pursuingnew ideas is usually closely associate with risk (in many cases significant risk). At thesame time it is important to differentiate risk-taking from recklessness. The modelproposes that managed risk-taking could result in an innovative and dynamic culture.4.3.2 ResilienceCoutu (2002, p. 48) observed that resilience theories overlap in three ways.Individuals who are resilient possess a firm acceptance of reality, a profound beliefthat life is meaningful and are able to improvise. Coutu suggests that people mayrecover from hardship with just one or two of these characteristics, but trueresilience is only possible when all three characteristics exist and that these qualitieshold true for organisations (Coutu 2002, p. 48). 18© Atul Kuver 2011
  19. 19. This model embeds the resilience element within organisational culture. This hasbeen done for three reasons: 1. Individual resilience in a large group is not always obvious. 2. Resilience is a subjective concept. It is not possible to create a measure of resilience and then compare individuals because there is no set standard against which resilience can be measured. 3. Culture can be treated as a single entity. While sub-cultures still exist, it is easier to gauge the aggregate resilience then to attempt qualification of individual resistance.4.3.3 MomentumJansen (2000, p. 54) presents three conceptualisations of momentum. The threeviews are: 1. strategic persistence —the ability to maintain a prior course of action; 2. the ability of a leader to create or control momentum; and 3. momentum as a dynamic force, the presence or absence of which determines the outcome of a change effort.In this model, concepts (1) and (3) are of greater significance. Persistence andmomentum are good indicators of resilience.4.3.4 Change Valence and Change EfficacyCultural change valence and change efficacy are extensions of personal valence andself-efficacy discussed for the individual. The concepts are the same as that for theindividual, except that valence and efficacy now apply at the organisation culturelevel. Cultural change valence is the cultural or aggregate belief that the change isbeneficial. Change efficacy at the cultural level means that the organisation’s cultureis at a point where it considers that it has the ability to successfully manage thechange. 19© Atul Kuver 2011
  20. 20. It could be argued that valence and efficacy are concepts that can only apply toindividuals rather than aggregates. This argument is sound. However, this modelsees organisational culture as a single entity (although there may be sub-cultures).Therefore, while the two concepts may seem abstract when compared with theconcepts of reliance and momentum, they can still assist in understanding thecomplex nature of organisational change readiness.To increase or heighten change readiness, the organisation’s culture should aim tobe more resilient, and increase momentum, change valence and change efficacy. Themodel suggests that these results may be achieved by developing or sustaining theculture in the areas of innovation, risk-taking and learning opportunities. In addition,the organisation must also demonstrate flexibility. These can be considered to bethe input parameters needed to develop the appropriate culture.4.4 OrganisationThe resource-based view sees the organisation as having a unique set of resourcesand capabilities that gives rise to the concept of competitive advantage. According toTeese and Pisano (cited in Jones et al. 2005), leading organisations in global marketswill need to show timely responsiveness to efficiently manage and re-deploy thesecapabilities. Turner and Crawford (cited in Jones et al. 2005) further distinguishbetween operational capabilities and reshaping capabilities. Operational capabilitiesare those required to sustain everyday performance and these capabilities do nottypically help in managing change effectively. On the other hand, reshapingcapability consists of three key elements. These are (Jones et al. 2005, p. 367):  engagement — involves employees participation to encourage motivation and dedication to the goals and plans of the organisation;  development — improving resources and business systems to achieve the organisation’s goals; and  performance management — proactive management of factors that drive organisational performance to ensure that it achieves the intended change. 20© Atul Kuver 2011
  21. 21. 4.4.1 InformationAccording to Jimmieson et al. (2004), minimising feelings of uncertainty andassociated threats is a significant challenge faced by managers during organisationalchange. During periods of change, individuals within the organisation needinformation to help them develop a sense of situational awareness andunderstanding (Sutton & Kahn, cited in Jimmieson et al. 2004, p.12). Jimmieson et al.(2004) asserts that timely and accurate information about the changes and changeprocess may reduce uncertainty and that information may be made availablethrough either formal or informal channels (p.12).The model considers uncertainty as a characteristic of the individual and places theuncertainty element at its core. The information made available therefore mustpermeate the organisational culture and reach the individual with minimumfiltration. It then becomes important that the culture is such that it maximises thefree flow of information to the individual. Uncertainty has already been discussed inSection 4.2.5.4.4.2 Responsible LeadershipHiggs and Rowland (2010) assert that the role of leaders in the change process has asignificant impact on the success of change. In this model, leadership is viewed as adistributed function — a process that exists at many levels of the organisation andnot a function of position alone (Higgs & Rowland 2005). Higgs and Rowland (2005)classified leadership behaviour and mindsets during organisational change into threebroad categories, namely, shaping, framing change, and creating capacity.ShapingThis is a leader-centric approach to change implementation.Framing ChangeHere the leader creates a framework that lets others contribute to the changeprocess and displays a high level of trust in those who contribute to the change. 21© Atul Kuver 2011
  22. 22. Creating CapacityThe leader focuses on building individual and organisational capability andencourages growth and learning.The leadership characteristics for each leadership category and the impact of theleader’s behaviour are shown in Table 1.The behaviour of leaders can also influence the perception of organisational culture(Block, cited in Igo & Skitmore 2005, p. 123). The different practices develop fromthe basic assumptions leaders make when implementing changes needed for theorganisation’s long-term survival (Igo & Skitmore 2005, p. 123). Once adopted, theseassumptions are embedded into the organisation’s culture (Gordon, cited in Igo &Skitmore 2005, p.123).Leadership Key Leadership Characteristics Impact Category  negative impact  is eager to be the ‘mover and shaker’; on change  sets the pace which others follow; and success;  expects others to follow the leader’s Shaping  ‘heroic’ models actions. mitigate against (Higgs and Rowland 2010) sustainable performance.  creates a framework that lets other contribute to the change process;  displays a high level of trust in those who contribute to the change;  positively related Framing  works with others to build vision and to change success; Change direction;  promotes the reasons for change and explains why it is not desirable to return to older practices;  focuses on building individual and organisational capability;  positively related Creating  encourages growth and learning; to change success; Capacity  develops the necessary change implementation skills in people;  provides feedback; and 22© Atul Kuver 2011
  23. 23.  provides training;Table 1. Leadership characteristics for each leadership category and the impact of the leader’sbehaviour. 23© Atul Kuver 2011
  24. 24. 5 FITNESS OF THE MODEL FOR USE BY ADB CHANGE AGENTS Possible Change Issue Attention EventAllow Div A to Changes to  Informationbecome more procedures results in Organisation  Responsiblecompetitive new or unfamiliar leadership practices.  Innovation Culture  Risk-taking  Flexibility  Perception Individual  Self-efficacy  UncertaintyDevelop project Retraining of project Organisation  Informationagility managers and  Learning engineers. opportunities Culture  Innovation  Flexibility  Motivation Individual  Personal valance  Self-efficacyMaintain and Re-deploy  Recognition ofrecruit talent employees to other excellence Organisation sites.  Responsible leadership  Learning opportunities Culture  Risk-taking  Flexibility  Motivation  Personal valance Individual  Uncertainty  Self-efficacyImprove Additional training  Informationemployee and implementation  Responsiblemorale and of processes that Organisation leadershipaddress allow greater  Recognition ofuncertainty transparency excellence  Learning Culture opportunities  Innovation  Perception Individual  Motivation 24© Atul Kuver 2011
  25. 25.  Personal valance  Uncertainty  Self EfficacyTable 2. Application of the model to the issues faced by ADB in relation to Div A.Table 2 shows several issues that need to be addressed at Div A. Dealing with theseissues would require change. Possible change events corresponding to each issue arealso given in Table 2. Column 3 shows the elements that would require the changeagent’s attention. The use of the word ‘attention’ is a deliberate attempt to avoidthe word ‘application’. Application implies that the model may be normative, whichit is not. Its purpose is to allow the change agent to use the organisational culture tobuild or improve change readiness. The arrow traversing the Culture component inFigure 1 should be taken as building change readiness through organisationalculture.6 CONCLUSIONThe purpose of this study was to develop a ’fit-for-purpose’ model to build changereadiness through organisational culture. The model has been developed through aresource-based view of the organisational culture and practices that facilitate changereadiness, sustainable people management practices and the capacity to implementchange to deal with business sustainability challenges. The report has examined theconcept of change readiness to establish links between change readiness andorganisational culture. The change challenges at ADB were presented to learn aboutthe types of change events the model may be required to address.This model provides a framework to improve Div A’s change readiness through itsculture and to build organisational resilience. It is important to note that the modelis not intended to be applied as a process for changing organisational culture. Themodel does not actively seek to change the fundamentals of the established culture;change readiness is developed through positive utilisation of organisational culture. 25© Atul Kuver 2011
  26. 26. 26© Atul Kuver 2011
  27. 27. REFERENCESArmenakis, A, & Harris, S 2009, Reflections: our Journey in Organizational ChangeResearch and Practice, Journal of Change Management, 9, 2, pp. 127-142.Bolton, D 2004, ‘Change, coping and context in the resilient organisation’, Mt ElizaBusiness Review, vol. 7, no. 1, pp. 57-66.Bordia, P, Hobman, E, Jones, E, Gallois, C & Callan, VJ 2004a, ‘Uncertainty DuringOrganizational Change: Types, Consequences, and Management Strategies’, Journalof Business and Psychology, vol. 18, no. 4, pp.507-532Champoux, JE 2011, Organizational Behaviour: Integrating Individuals, Groups andOrganizations, 4th Edn, Routledge, London and New YorkCoutu, DL 2002, ‘How Resilience Works’, Harvard Business Review, May, pp.46-55Cunningham, C, Woodward, C, Shannon, H, MacIntosh, J, Lendrum, B, Rosenbloom,D, & Brown, J 2002, Readiness for organizational change: A longitudinal study ofworkplace, psychological and behavioural correlates, Journal of Occupational &Organizational Psychology, 75, 4, p. 377.Eby, LT, Adams, DM, Russell, JT & Gaby, SH 2000, ‘Perceptions of OrganisationalReadiness for Change: Factors related to Employees’ Reactions to theImplementation of Team Base Selling’, Human Relations, vol. 53, no. 3, pp.419-442.Gottschalg, O & Zollo, M 2007, ‘Interest Alignment and Competitive Advantage’,Academy of Management Review, vol. 32, no. 2, pp. 418-437.Guay, T. R. 2007, ‘Globalization and its Implications for the Defense Industrial Base’,www.strategicstudiesinstitute.army.mil/pdffiles/PUB756.pdf [accessed 20 February2011] 27© Atul Kuver 2011
  28. 28. Higgs, M, & Rowland, D 2005, All Changes Great and Small: Exploring Approaches toChange and its Leadership, Journal of Change Management, 5, 2, pp. 121-151.Higgs, M, & Rowland, D 2010, Emperors with clothes on: The role of self-awarenessin developing effective change leadership, Journal of Change Management, 10, 4,pp. 369-385.Igo, T, & Skitmore, M 2006, Diagnosing the organizational culture of an Australianengineering consultancy using the competing values framework, ConstructionInnovation (Sage Publications, Ltd. ), 6, 2, pp. 121-139.Jansen, KJ 2000, ‘The Emerging Dynamics of Change: Resistance, Readiness, andMomentum’, Human Resource Planning, vol. 23, no. 2, pp53-55.Jimmieson, NL, Terry, DJ & Callan, VJ 2004, ‘A Longitudinal Study of EmployeeAdaptation to Organizational Change: The Role of Change-Related Information andChange-Related Self-Efficacy’, Journal of Occupational Health Psychology, vol. 9,no.1, pp.11-27Jones, Renae A., Nerina L. Jimmieson, and Andrew Griffiths. "The Impact ofOrganizational Culture and Reshaping Capabilities on Change ImplementationSuccess: The Mediating Role of Readiness for Change." Journal of ManagementStudies 42, no. 2 (March 2005): 361-386.Weiner, B 2009, A theory of organizational readiness for change, ImplementationScience, 4, 1, p. 67. 28© Atul Kuver 2011

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