2. The trap of success
One of the paradoxes of organizational
life is that success often sets the stage for
failure
3. Prolonged
Prolonged
period of
period of
success
success
The trap of success
Source: Nadler & Shaw, 1995: 11
Outcomes
Success
Syndrome
Complacency
Arrogance
Learning
disabled
Decreased
customer focus
Increased Cost
Environmental
Disturbance
Poor external
alignment
Declining
performance
Less innovation
Codification
Internal focus
Death spiral
Do
more of
the
same
Denial
&
rationalisation
4. The trap of success
Most organisations, at some point, will be
faced with the need to transform themselves
in order to survive
Even organizations that invest heavily in
continuous improvement can become
victims of strategic drift.
While they change, they may not change fast
enough to keep up with the pace of change
in their environment.
4
5. Effective change strategies
• Beer, a leading US consultant and professor at
Harvard Business School, refers to two well tried
change strategies (Economic and OD) but argues that
the most effective strategy is a third way that
combines the best of both.
5
6. Economic strategies
• Focus on the drive for economic value through tough, topdown, results driven action.
• They involve the imposition of technical solutions to
problems that undermine organizational effectiveness.
• Solutions/interventions include:
Restructuring
Reengineering
Drives for efficiencies
layoffs
6
7. Organization Development (OD)
strategies
• Focus on creating the capabilities required to sustain
competitive advantage and high performance.
• These capabilities include:
Coordination and team work
Commitment and trust
Competencies (technical and leadership)
Open communications
The capacity for constructive conflict
Learning
7
8. Beer’s third way –
a combined Economic/OD strategy
Change strategies that are capable of delivering sustained
high performance require:
1.
The development of a vision that offers a compelling
and balanced business and OD direction
2.
The management of key stakeholders to buy time to
develop organizational capabilities
3.
The adoption of a socio-technical approach that
involves the development of down-the-line managers.
8
9. Top management are often reluctant to adopt a
combined strategy
Economic strategies tend to be favoured when the top team have
a mind set dominated by:
• Shareholder interests
• The assumption that the organization’s technical
(rather than social) systems determine performance
• The assumption that there is little to be gained from
dialogue with employees.
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3rd Edition, John Hayes, Palgrave, 2010
9
10. The main differences between economic, OD
and combined strategies
1.
2.
3.
4.
5.
Leadership
Focus
Process
Reward systems
Use of consultants
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3rd Edition, John Hayes, Palgrave, 2010
10
11. Shaping implementation strategies
Implementation strategies need to be internally
consistent and compatible with key situational
variables
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3rd Edition, John Hayes, Palgrave, 2010
11
12. Impact of situational variables
Directive
Collaborative
Urgent requirement for change.
Non-urgent requirement for change.
Desired end state clearly specified from
the start.
Little resistance anticipated
What needs to be done to resolve problem or
exploit opportunity not clear from the start.
Great resistance anticipated
Change managers have access to all the
information they need
Change managers need information from
other stakeholders
Others have high trust in change
managers.
Others have low trust in change managers.
Implementation is not dependant on the Implementation is highly dependant on the
commitment of others.
commitment of others.
12
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3rd Edition, John Hayes, Palgrave, 2010
13. Summary
1. Three approaches to implementation
• Economic (drive) strategies
• OD (development) strategies
• Combined drive and develop strategies
1. The strategies favoured by CEOs
2. Situational variables that need to be considered
when shaping implementation strategies
THE THEORY & PRACTICE OF CHANGE MANAGEMENT 3rd Edition, John Hayes, Palgrave, 2010
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