Resistance To Change Final Case (2)


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Resistance To Change Final Case (2)

  1. 1. UNIVERSITY OF LA VERNE La Verne, California Leadership Skills to Overcoming Resistance to Organizational Change A Case-Based Capstone Paper Submittedin Partial Fulfillment of the Requirements for the Degree Master of Science, Leadership and Management Majid Bakarman College of Business and Public ManagementDepartment of Business Management and Leadership May 2010
  2. 2. Copyright © 2010 Majid BakarmanAll Rights Reserved
  3. 3. Abstract Organizations have experienced plentiful organizational change failures overyears, in which the resistance to organizational changes was a major barrier. However,change agents did not handle the resistance well, because they were lack of certainleadership skills. The purpose of this case study was to examine where the resistancecame from, and evaluate to what level each element of the resistance impacted onorganizational changes at financial institutions in Saudi Arabia. Research questionsconsisted of 1) What are the reasons that lead resisters to resist an organizationalchange? 2) What kind of leadership qualities are the most effective approaches toovercome resistance? Using the surveys monkey for both employees and managers, theresearch invited 10 employees who identified the behaviors code and the reasonsbehind resistance to organizational change, and five managers who declared theirprospectives about resistance and what actions did they take when they encounteredresistance to organizational changes. The results of this study illustrated the mostimportant reasons of employees’ resisted organizational changes, and found out thatlack of certain leadership skills were the most challenges for managers who failed tomake organizational changes effectively. The research determined that managersshould have sufficient leadership skills to drive organizational changes successfully.
  4. 4. Acknowledgement I would like to thank all the professors who work in the MSLM program at Universityof La Verne, my classmates, friends, and previous colleagues who participated in thesurvey helped me achieve my goals and objectives in this study. I deeply appreciatedthem that devoted their valuable time and commitment to the research.
  5. 5. Dedication This is dedicated to supportive parents who inspired me to pursue my highereducation, my brothers and sisters who consistently encouraged me, my wife and threechildren who provided unlimited patience to see me through this effort. For allparticipants who responded to the survey contributed to design a successfulorganizational change.
  6. 6. Table of ContentsIntroduction ………………………………………………………………………………. 1Literature Review ……………………………………………...………………………… 3Case Study Methodology ……………………………………………………………….. 10Results ……………………………………………………………………………………. 16Discussion and Implementation Plan ………………………………………………….. 22References ………………………………………………………………………………. 29Appendices ………………………………………………………………………………. 31
  7. 7. List of FiguresFigure 1: Participated by Years of Experience ………….……………………… 11Figure 2: Participated by Age …………………….……………………………… 11Figure 3: Resistance as Negative Attitude ……...……….……………………… 12Figure 4: The Most Influential Reasons Why Employees Resist ….…….......... 12Figure 5: Resistance is Negative.…………………………………...…………… 20Figure 6: Involvement, Appreciation & Experience ……………...………..…… 21
  8. 8. List of TablesTable 1: Distinctions Between Management and Leadership …………….…… 6Table 2: Examples of Factors of Resistance …..…………..………..…………… 14Table 3: The Current Loan Process is Sufficient or Not …..………....…………… 14Table 4: Example of Open-ended questions ………..……………....…………… 15Table 5: Communication Behaviors..……………………..…………..…………… 16Table 6: Feeling Behaviors ……..………………………………………..……… 17Table 7: Incentive Behaviors ………………………………..……….………… 17Table 8:Conflict Behaviors ……………………………………..…….…………… 18Table 9: The Reasons to Resist Change………………………………………… 18Table 10: Behaviors managers observed employees resist changes…………… 19Table 11: The most important reasons why people resist the changes…………... 19Table 12: The actions managers took as leader to overcome resistors behaviors… 20
  9. 9. Overcoming Resistance to Change 1 CHAPTER 1 INTRODUCTION To be effective, leaders have to overcome resistance to changes in order toachieve organizational growth and development. Implementing organizational changessuccessfully at financial institutions in Saudi Arabia requires certain leadership skills toinstitutionalize the change efforts and to reduce resistance. When change initiativeswere introduced into the workplace with little positive impact on work performance andoperating efficiencies, it results in wasted time and money. Organizations are stillsuffering from resistance to organizational changes, which demonstrate the need forleaders to continue to develop their skills to deal with resistance in implementingchanges in the workplace (Atkinson, 2005). Changes in large institutions are often difficult when leaders are not able tomanage changes well. However, the need to make changes will not go away.Organizations need to develop an approach to overcome resistance and drive changesin an effective way. Generating leadership skills to encounter resistance and implementchange efforts successfully will contribute to a better performance, increasing motivationto its employees, and satisfaction from their clients (Atkinson, 2005). Research indicates that there is a major challenge in driving organizationalchanges, which is dealing with resistance that change agents encounter. It isextraordinary for any organizational change does not face any resistance. Recognizingand welcoming resistance as a healthy response and an opportunity to listen to differentperspectives is what allows leaders to successfully navigate the change process(Atkinson, 2005). Leadership skills are very essential to overcome resistance to organizationalchanges. Wise leaders can achieve the organizational changes by applying leadershipqualities today in the workplace to decrease resistance to organizational changes. As a
  10. 10. Overcoming Resistance to Change 2result, organizations improve its qualities and quantities, and win the market share(Geller, 2002). To identify the leadership skills and behaviors that can help to overcomeresistance to organizational change and two kinds of surveys were completed bymanagers and employees in the facilities department of a financial services organization.The survey was designed to identify the most important factors that were most effectivein addressing resistance when a change process was implemented. Two preciseresearch questions were addressed: (1) What are the reasons that lead resisters toresist an organizational change? (2) What leadership quality is the most effectiveapproach to overcome resistance to organizational changes? The result of this case study demonstrates the important factors and to whatdegree these factors influence employees to resist organization change. The mostcentral behavior employees asserted in this case was lack of perceived benefits in thechange process. Also the outcome of this case study shows what kind of leadershipskills managers would use when they face resistance from their employees. The resultsof this study show that leadership is essential to implement the organizational changewisely. The recommended action plan is to help managers implement organizationalchange efficiently by using different criteria of leadership skills.
  11. 11. Overcoming Resistance to Change 3 CHAPTER TWO LITERATURE REVIEWResistance to Change Leaders understand resistance as having numerous components, which arerestraining, and do not support the change. People who resist change play it safe in thecurrent situation, and thus refuse to explore and try a new concept of change, as they donot see the benefits of it. Although resistance often comes from everywhere in theorganizational change process, resistance is in itself a subjective issue where managersobserve behaviors that do not support an organizational change (Ford & Ford, 2009).“One of the biggest mistakes change leaders can make is to assume that resistance iswithout merit. But resisters can shed valuable insights about how proposed changesmight be modified to increase the odds for success” (Michelman, 2007, p.3). Harvey (1995) declares that an organizational change that lacks resistance is notconsidered a change at all. There are rational reasons why individuals would support thechange process before they clearly understanding its implications. First, followers haveonly heard about the change, but nothing has been implemented due to ineffectivemanagers. Then, subordinates have no commitment to create or develop theorganization. Next, no one is willing to speak up when resistance is present. Fourth, allteam members’ perceptions are alike in terms of organizational change, and everyonesees it is an appropriate change. Therefore, resistance is a healthy response to a long-term organizational change which leads leaders to embrace resistance. “A majorproblem in driving change in organizations is dealing with and managing the resistanceyou will encounter. Whether the initiative is focused upon coaching a new leadershipculture, or promoting new behaviors in customer relationship management, the problemsencountered will be similar” (Atkinson, 2005, p.15).
  12. 12. Overcoming Resistance to Change 4 Michelman states that resisters who may have valuable insights in identifyingorganizational change may prevent implementation of such changes (2007). Carefullydiagnosing their mindful inquiries can multiply the chances for streamlined success. It isnot critical how well change is planned in efforts, but the most crucial difficulty is toignore change resisters in management positions. Resisters are one of numerouscomponents of the organization. It is particularly crucial to motivate them. Gullickson(2009) states that an exclusive development can generate changes and valuableprinciples when resistance arises from individuals that resist the change action plan. Organizations resist radical change with every organizational chart and standard operating procedure manual they can muster. Therefore, to execute a strategy, one must enable change, as well as overcome resistance to change. One model successfully used by a Fortune 100 company recognizes that the following three items are necessary for achieving radical change:  Dissatisfaction with an existing situation will create a need to change.  Clearly communicating a strategic vision will provide a goal for change.  Teaching and practicing the first change steps will lead to an execution orientation within the organization. (Lefebvre , 1997, p. 58).Sources of Resistance Many sources of resistance have an impact on an organizational change.Resistances consist of insufficient ownership, inadequate compensation, increasedtrouble, management’s commitment, insecurity, norm’s conflict, monotony, disorder,advantage, diverse experience, the unexpected, substantial change, collapse, andexceptional organizational structure. Each factor plays a different role in theorganizational change process. Wise leaders predict the circumstance that has moreinfluence than others do (Harvey, 1995). Resistance towards change encompasses behaviors that are acted out by change recipients in order to slow down or terminate an intended organizational change. Several researchers have reported that attempts to implement strategic changes sometimes are met with resistance from those affected by the change. (Lines, 2004, p. 197)
  13. 13. Overcoming Resistance to Change 5Organizations that operate in dynamic environments are highly competitive inovercoming considerable challenges to implement organizational changes.Consequently, managing organizational change is particularly crucial for anorganizational development. In the wisdom of change management, the resistance toorganizational change was the most crucial challenge for implementing it (Mabin,Forgeson, & Green, 2001). The reasons employees and even leaders resist change can vary. Some key issues: • Fear of risk; • Lack of clarity regarding purpose of change; • Fear of inadequate staffing to achieve goals targeted in change; • Fear of failure; and • Lack of will to change” (Merisalo ,2010, p.3). Curtis and White (2002) state several reasons for the most serious causes ofresistance to organizational change, which increase tension, fear of urgency, andconflicts with change agents. Changees tend to pay attention to their own goals,misunderstanding the need for organizational change, they are not confident about thefuture development. Organizations did not prepare well to create readiness of thechange. More than likely, there was insufficient communication and no system to monitorthe change process, and give inappropriate rewards to those who fully supported andfacilitated the needed changes.Organizational Change Bommer, Rich, and Rubin (2005) argued that transformational leadership is avital tool used to influence an effective organizational change effort, whichtransformational leaders used to motivate employees into becoming agents of theorganizational change. Increasing the organization’s performance will support on-goinginstitutionalized organizational change (Goodman, & Rousseau, 2005). Carter, Ulrich,and Goldsmith (2005) announce that each organizational change overcomes objection.
  14. 14. Overcoming Resistance to Change 6The more individuals are forced to organization change, they more resistance will existin buy-in process. All changes encounter resistance. Employees often resist changewhile unconsciously they are changing. Resistance while processing an additionalchange would virtually disappear. Jones (2010) reported that resistance toorganizational change decreases an organization’s competency and diminishes itsopportunity to sustain. As a result, inactivity is established in the entire organization,among team members, and at every level. The representative of change does not onlyembrace responsibility for the relationship with individuals, but he also generates thestrategy of change implementation (Ford, & Ford 2008).Leadership Strategy Leaders hold people accountable for accomplishing proactive process activities that contribute to eventual group and organizational success in productivity, quality, and/or safety. Moreover when people see some improvement in the process, they feel rewarded for their efforts and would develop a sense of personal responsibility for continued contributions and never- ending improvement. Thus, by focusing on the process, leaders help people perceive the power they have over the frequent, intrinsic consequences of their jobs. (Geller, 2002, p. 32) Leadership strategies are more effective than management strategies are while dealing with organizational change. (See Table 1)Table (1)Distinctions Between Management and Leadership (source: Geller, 2002, p.47) Managers Leaders Hold people accountable Build responsibility Focus on outcomes Focus on process Focus on extrinsic consequences Focus on intrinsic consequences Give more corrective feedback Give more supportive feedback Train only Educate first Use unconditional directives Use conditional directives Speak first, then listen Listen first, then speak Answer questions Ask questions Promote compliance Promote ownership Limit mindful choice Facilitate mindful choice Mandate rules and policies Set expectations Manage what’s measured Facilitate intangibles Fall victim to stereotypes Treat people as individuals Direct Direct, support, coach, or delegate
  15. 15. Overcoming Resistance to Change 7 Miner (2005) claims that resistance arises from subordinates behaviors towardthe organizational change, and such behaviors are decreased by the leaders’charismatic behavioral responses. Windall (2007) mentions that a wise leader wouldreward an earlier achievement, take chances to create a desired acceptance of thechangers for a recent revision even though organizational change is the better plan toimprove efficiency. When determining how to influence employees and reduceresistance to change, managers should consider the relationship they have with targetedemployees (Furst, & Cable, 2008). As a consequence, individuals will welcome anyvariety of change and participate in this plan effectively. Leaders need to have the abilityto bring individuals to their side in order to implement an organizational changeeffectively (Knippenberg & Hogg, 2003). Ashkanasy, and Kavanagh (2006) found thatthe most crucial competencies of leadership to operate in organizational change areclarifying the change vision, communicate, and implement transparency in to theoperation process. The smartest strategy to conquer resistance is to invite changees in to decisionsand solutions making that will be delivered to and affect their work. Providing systematicprocedure (Lee & Krayer, 2003), “Resistance continues only when leaders do not knowhow to handle people who are experiencing change. Resistance is the leader’schallenge, not the employees’ challenge”. Schein (2004) announces that managers oftenface subordinates resistance to change without adequate consideration which oftenresults in being plans delayed overtime. Conflicts come from lack of readiness to changeand insufficient understanding about the vision. Leaders have to achieve understandingand acceptance from every level in the organization through communication to supportorganizational change, so that the change can be accomplished in a desired time frame.Huang, and Huang (2009) articulates that how “the strength or the direction, the
  16. 16. Overcoming Resistance to Change 8relationship between resistance to change and change outcome are meaningful andeven causal” (p.111). Purpose of this Case Study The purpose of this case study is to examine where resistance came from andanalyze to what degree each factor is influenced by organizational changes. The goal ofthis research is to create a program to assist the internal and external change agents toimplement organizational changes effectively by applying leadership skills to overcomeresistance. The literature reviewed can provide a broad understanding of the reasons ofresistance to organizational changes, which can well prepare leaders to establish theframework to overcome the resistance. Communication system is carefully developed inorder to engage the buy in from followers. Characteristics such as persuasive, inspiring,constructive will be import to core competencies for a change agent (Kotter & Cohen,2002).Research Questions Research Question 1: What are the reasons that lead resisters to resist anorganizational change? Kotter and Schlesinger (2008) report that “To predict what form their resistancemight take, managers need to be aware of the four most common reasons people resistchange. These are a desire not to lose something of value, a misunderstanding of thechange and its implications, a belief that the change does not make sense for theorganization, and a low tolerance for change” (p.132). Answers to this case researchquestion are important to help managers diagnose where resistance comes from, so itcan give the change agent a clear image of why individuals resist organizational change.Therefore, genuine leaders could determine how to deal with resisters for the reason
  17. 17. Overcoming Resistance to Change 9that they recognize the sources of resistance and where impediment comes from andset up an adequate strategy to deal with it effectively. Research Question 2: What kind of leadership qualities are the most effectiveapproach to overcome resistance? Answering this question will assist agents to understand adequate leadershipqualities that enable them to lead resisters to understand why they resist. According toStrebel (1996) “Without such leadership, employees will remain skeptical of the vision forchange and distrustful of management, and management wills likewise he frustrated andstymied by employees resistance” (p.92). This research question is vital for the reasonthat it generates the valuable impact of leadership qualities for overcoming resistanceand implements organizational change successfully at financial corporations.
  18. 18. Overcoming Resistance to Change 10 CHAPTER 3 CASE STUDY METHODOLOGYOverview The purpose of this study was to examine and analyze sources of resistance andcreate an instrumental tool of leadership skills to help change agents achieveorganizational changes effectively at a financial institution. Data were gathered fromemployees in a major bank in Saudi Arabia, which was set up in 1977, and its capitalwas worth Saudi Riyal (SAR) 4500 millions. The organization is composed of aheadquarters, two local offices, and 45 branches nationwide. It is a large organizationwith 816 employees. However, the facility department consisted of 20 employees, whichis the heart beating of the bank. A major change at the facilities department would affectthe whole organization.Participants This study was conducted with two surveys, which included a managers’ surveyand an employees’ survey. There were five managers who participated in the managers’survey, and ten employees at the facilities department who completed the employees’survey.Selection Criteria Participants were selected using several criteria:All participants in either managers’ survey or employees’ survey had experienced atleast one organizational change at the facility department (See figure 1).
  19. 19. Overcoming Resistance to Change 11 Figure 1: Participants’ Years of Experience Seven out of 15 participants were in the range from 28 to 32 years old, anotherfive participants were between 23 and 27 years old, two of the rest were over 33 yearsold, and only one participant was younger than 22 years old (See figure 2).Figure 2: Participants’ Age The managers who participated in the survey of the study were selected toarticulate whether the resistance negative attitude or not to affect organizational changesat facility department with various perspectives (See figure 3).
  20. 20. Overcoming Resistance to Change 12 Figure3: Resistance as Negative Attitude. The Managers who participated in the survey were selected to identify theresistance behaviors that they had observed from employees. The employees whoparticipated in the survey of the study were selected to explain the factors that causedresistance when a new change applied (See figure 4).Figure 4: The Most Influential Reasons why Employees Resist Change.
  21. 21. Overcoming Resistance to Change 13Survey Instrument All participants were asked to take the survey using the survey monkey online bysending the link to their emails. The bank’s permission was given to the researcher todistribute surveys via a letter of approval signed by the Human Resources Office (SeeAppendix A).The participants were given an informed consent attached to their emails.Their personal identities were not disclosed, and their responses were used for thepurpose of this study only (See Appendix B). The research was conducted by quantitative methodology, which included twoseparate surveys on Survey Monkey for different participants working on differentpositions separately. It was the preferred method of data collection for the abroadparticipants, because it was easy to manage, and data could be collected quicklythrough emails. The researcher created 10 questions in each survey that designed tocollect information either from managers or from employees (See Appendix C and D).Each survey had three sections :The first section was covered the demographicsquestions; the second section was asked three questions about perceptions oforganizational change the in the workplace process; the third section addressed fourquestions about the reasons of resistance to organizational changes, included oneopen-end question in the employees’ survey and four open-end questions in themanagers’ survey to allow participants to add their insight in terms of organizationalchanges. The scale used to measure the responses was 1 =Strongly Disagree,2=Disagree, 3 = Neither Disagree, Agree 4= Agree, or 5= Strongly Disagree, todemonstrate their opinion toward resistance to organization change (Fields, 2002). Inaddition, rating scale was used that to explain the degree each factor had influencedresisters to resist organizational changes. For example, rating of “1” means thatbehavior/element had no impact on why the change was not successful and a rating of
  22. 22. Overcoming Resistance to Change 14“5” means that the behavior/element had a strong impact on the failure of the changesbeing made to the loan process. Use ratings of “2”, “3”, and “4” to evaluate your perceptions between “not at all”and “very much so” (Harvey, 1995, p.66).(see Table2)Table 2: Examples of factors that cause resistance Example of resources of resistance to organization changesLack owner ship for the changes to loan processLack of BenefitsIncreased of burden (it was “more work”)Lack of communication from senior leaders One of the common questions in each survey, either in managers’ survey oremployees’ survey part, was about whether the current loan process is sufficient andneeds no improvement to evaluate the loan process contributions to reach theorganization’s goal (See Table 2).Table 3: The current loan process is sufficient and needs no improvement Managers EmployeesAnswer Options N % N %Strongly Disagree 2 20% 2 20%Disagree 6 60% 6 60%Neither Disagree nor Agree 2 20% 0 0%Agree 0 0% 1 10%Strongly Agree 0 0% 1 10%Totals 5 100% 10 100% The final portion of each survey, either in managers’ survey or employees’survey, was included an open-ended questions to allow the participants add their
  23. 23. Overcoming Resistance to Change 15valuable perceptions, for the reason that the internal culture of the financial organizationis played a crucial function to resist organizational changes. (See Table 3)Table 4:Open-ended questions.Example of the open-ended questionsWhat are the reasons that lead resisters to resist change? (Employees survey)What actions did you take as the leader to address those actions/behaviors? (Managerssurvey)
  24. 24. Overcoming Resistance to Change 16 CHAPTER 4 CASE STUDY RESULTS This case study examined the factors of resistance to organizational changesfrom both employees and managers perceptions. Results for Research Question 1:What are the reasons that lead resisters to resist an organizational change? Thisquestion was answered by ten employees who participated through survey monkey.Individuals explained where the sources of resistance came from and to what degreeeach factor had impacted organizational changes in the facilities department. Thesources of resistance were raised from diverse behaviors, including communicationbehaviors, feeling behaviors, incentive behaviors, and conflict behaviors. The communication behaviors were explained and rated by employees on threefactors, which included: 1) chaos –too much change happened at the same time with anaverage rating of 3.89, 2) lack of communication from senior leaders who have mostknowledge about the change itself, employees who participates in the survey rated thisvaluable aspect 3.76, and 3) lack of ownership for the changes to the loan process withan average rating of 3.30. Therefore, there is a relationship between resistance toorganizational change and communication behaviors are very significant from theparticipants perceptions (See Table 5).Table 5: Communication BehaviorsCommunication Behaviors Rating Average 1- Chaos – too much work 3.89 2- Lack of communication 3.67 3- Lack of ownership 3.30 The second behavioral factor was feeling, which includes superiority, insecurity,and loneliness. Participants rated superiority as the most important factor that influencedfeeling toward resistance to change with an average rate 3.44. Insecurity from
  25. 25. Overcoming Resistance to Change 17organizational changes was rated as 2.89 in average, and loneliness was rated as 2.88(See Table 6).Table 6: Feeling BehaviorsFeeling Behaviors Rating Average 1- Superiority 3.44 2- Insecurity 2.89 3- Loneliness 2.88 The third catgory was incentive behaviors, which included lack of benefits, lack ofrecognition, and boredom. Lack of benefits was the most important factor that leademployees to resist organizational changes with average rate 4.38. Lack of recognitionwas rated at average 3.56, where employees did not feel appreciated for the effort theymade. As a result, they resisted any sort of change in the loan process. Employees gaveboredom an average rating of 4.00, where it played an important role in the changeefforts, because there was no motivation to learn new things (See Table 7).Table 7: Incentive BehaviorsCommunication Behaviors Rating Average 1- Lack of benefits 4.38 2- Lack of recognition 3.56 3- Boredom 4.00 The fourth catgory was about conflict behaviors, which included lack of clearorganization structure, lack of time to prepare and process the change, normsincongruence, and new knowledge required. Employees had rated the lack oforganizational structure with averege rate 3.44 that indicated to the relationship betweentop management was not effective to facilitate the change efforts. It was hard to makechanges in overnight for the reason that it would create confilcts and the change wouldnot be successful. Sudden was average rating of 3.76 in the survey. Participants rated
  26. 26. Overcoming Resistance to Change 18norms incongruence with an average rating of 3.4 in terms of its influence on change.Employess mentioned that new knowledge required to deal with a new change to avoidconflicts and misunderstanding. It was rated at average 4.11 (See Table 8).Table 8: Conflict BehaviorsConflict Behaviors Rating Ave 1- Lack of clear organizational 3.44 structure 3.67 2- Sudden 3.40 3- Norms incongruence 4.11 4- New knowledge required Managers also articulated the factors of resistance based on open- enededquestions. The most significant factor was explained by mangers was that employeesthought that they would not get any benefit from that change, which represented 40% ofthe respondents. The second factor was that employees did not pay attention to themain goal, which covered 40% of the respondents. The third factor was declared thatemployees felt inconvenience to make change, which was rated at 10% (See Table 9).Table 9: The reasons people resist changeFactors of resistance % 1- Lack of benefits 40% 2- Inattention to objectives 40% 3- Inconvenience 20% Managers were asked about the behaviors they observed from employees duringthe change.The behavior managers observed on their employees complained about anew procedure, which represented 40%. Postponement was a behavior that managersnoticed the employees performed against a new change. Managers also stated thatemployees just thought about their own ego (See Table 10).
  27. 27. Overcoming Resistance to Change 19Table 10: Behaviors managers observed employees resist changes in the loan process.Behaviors of resistance % 1- Complaining 45% 2- Postponed 33% 3- Focusing on their Own ego 22% Employees were asked open–ended questions to articulate unique reasons thatled resistors to resist organizational changes. The result of this question as the following:The first reason was that no benefits employees got from that change. The secondreason was communication system across the hierarchy between managers andemployees. The third one was incompetent employees hired in the facilities department.The last one was lack of leadership skills necessary to implement changes (See Table11).Table 11: The most important reasons people resist the changes.Behaviors of resistance % 1- Lack of benefits 38.5% 2- Lack of communication 23.1% 3- Unqualified hire 15.4% 4- Lack of leadership 15.4% 5- Fear of losing 7.7% Managers were asked to explain if the resistance to changes the process wasnegative. Sixty percent of the respondents declared that they strongly agreed that theresistance from employees against the change was negative. Twenty percent of theparticipants either disagreed or agreed that the resistance was negative (See Figure 5).
  28. 28. Overcoming Resistance to Change 20Figure 5: Resistance from employess to change the loan process Results for Research Question 2: What kind of leadership qualities was the mosteffective approach to overcome resistance? For Research Question 2, only managersresponded to the last 4 questions on the survey in order to answered this researchquestion. The managers who participated in the survey articulated that 60% of them didnot feel appreciated for the effort they have contributed to implement the change indiscussions and decision making in the loan change process. Moreover, 60% of themanagers declared that the earlier change did not contribute to high performance. Onthe contrary, 20% of the managers that participated in the survey stated that earlierchanges led to high performance effectively. Most of the managers who answered thesurvey did not involve to the discussions and decision-making level in the loan changeprocess (See Figure 6).
  29. 29. Overcoming Resistance to Change 21.Figure 6: Involvement, Appreciation and Experience The last question in the managers’ survey asked about what kind of leadershipmanagers would initiate with their subordinates to resolve resistance. The mostfrequently stated behavior was to encourage the employees to do the job moreeffectively in order to facilitate the success of the change process. Others announcedthat the best ways to overcome resistance from subordintes were persuasion andinfluence them to perform effectively (See Table 12).Table 12: The actions mangers took as leader to overcome resistors behaviorsLeadership skills % 1- Power 43.3% 2- Encouragement 24.7% 3- Persuasion 17.6% 4- Influence 14.4%
  30. 30. Overcoming Resistance to Change 22 CHAPTER 5 DISCUSSION AND IMPLEMENTATION PLAN Many organizational change efforts failed at financial institutions because ofnumerous resistances that occur for different reasons. These results are important,because the participants explained the reasons for resistance to organizational changes,which organizations can adopt to overcome resistance effectively. The most importantreasons for employees to resist organizational changes were found to be functionalexpectations, communication, incentives, feelings, and conflict behaviors. The resultsalso clarified that managers considered resistances as negative actions towardorganizational changes, so that they often avoided or ignored the individuals whoengaged in these actions. The results also make it evident that employees who resistorganizational changes have not benn involved in the decision making process. Theseresults illustrate the need for more effective leadership skills to overcome resistances toorganizational changes in the financial institute in Saudi Arabia. According to Kotter (1996), a useful purpose of an organizational change wouldnot be understood if the communicators are not delivering the vision of theorganizational change clearly to their subordinates. Direction and simple communicationare effective more than complicated and indirect communication. Communicatingthrough behaviors about a new approach is more effective to influence the resisters.Listening to the changes is considered a wise communication strategy because theemployees are providing valuable feedback, which assume the change is a wrongcourse. Participants who participated in this case study declared that communicationbehaviors were taking a major function in the change process. The employees whoparticipated in the survey clarified the reasons of resistance to the change are caused bylack of communication, lack of ownership, and lack of institutionalization of the changes.
  31. 31. Overcoming Resistance to Change 23 One of the most critical aspects to resist organizational changes is pay off.Examining the level of pay off to the employees has a great impact on theimplementation. The more the organization generates an appropriate pay off policy, theless the employees resist the organizational change. Employees would not contributeeffectively to the change unless they see the benefits for themselves (Harvey, 1995).The majority of the participants either in the employee or manager’s survey emphasizedon incentive behaviors led to successful organizational changes. Identifying resistance behaviors to organizational changes is an indispensableprocess and an opportunity to improve the organizational change, because employeeswould provide the leader with a new perception from the blind side that the changercannot recognize it in the implementation. As a result, the leader will lead to createsuccessful change effort (Atchinson, 2005).The majority of the managers whoparticipated in this case study announced that resistance to organizational change wasconsidered as negative behavior from their employees. The most important resource to overcome resistance and drive the organizationalchange successfully is empowerment. It takes place when subordinates feel that theirsustainability is in their own hands, they understand the importance of a task;understand the purpose of organizational change, and are willing to reach theorganization goals. If changees do not feel empowered, they are not motivated tocollaborate in the change process (Harvey, 1995). The majority of the participants feltlack of involvement in the decision making process, they did not feel recognized andappreciated to their effort, which kept them away from the organizational commitment. Lencioni (2002) mentioned that an efficient path to make certain that a group ofchangees are focusing their attention on the outcomes of organizational change is toemphasize their benefits to the success of the organizational change. Once changeeshave a common sense about their supervisor values other than focusing on the
  32. 32. Overcoming Resistance to Change 24organizational change successfully, they will act the same way as supervisor did tofollow the informal norms. A wise leader pays attention to the organizational result, andempowers subordinates to the right direction. The employees who participated in thiscase study demonstrated that the lack of clear statement of benefits played a significantrole in the organizational change to overcome resistance. Moreover, managers whoparticipated in the study declared that inattention to objectives is a major resistancebehavior that led resisters to resist the organizational change. Resistance to organizational change occurs when employees lack ownership forthe change as well as if employees do not understand the purpose of the change. Forinstance, employees are more likely to accept change that they themselves haveacknowledged and planned. Any major organizational change that is imposed will beperformed negatively and result in resistance. The best way to identify ownership is toallow changees participate in the change’s decision (Harvey 1995). The employees who participated in the survey indicated that lack of ownership isone of the most significant reasons why changees did not implement the organizationalchange effectively. Recommended Action Plan The result of this case study shows that the reasons why employees do notperform effectively in the loan process development in the facilities department in thefinancial institution. Managers or change agents need to practice leadership skills toenable individuals to contribute to improving and developing the loan process of thebank in order to provide customers with better qualified services. The following stepsthat will assist managers and change agents to implement the loan processdevelopment effectively in facilities department
  33. 33. Overcoming Resistance to Change 25Communication for Buy-In Creating a competency communication is a crucial aspect for managers. Utilizingcommunication can increase the urgency of improving the current loan process, becausecompetitors are growing quickly in financial service industry. In addition, acknowledgingtalented employees who are willing to implement a new loan process to ensure thequality of work at facilities department. A successful communication strategy willminimize the gap between managers and employees to maintain their positive workingrelationships and give employees’ opportunities to share their thoughts about thestrengths and weaknesses of the current loan process. Good communication will allowmanagers to deliver effectively the task to employees, which is to get the bank’s targetednumber of loans each month. A wise communication strategy will help managers to discover the needs of theemployees, which are to improve their ability and train them in new skills in order to helpupdate loan process from being manually to systematically. In other words, throughcommunication leaders can identify the specific of training programs that meet facilitiesdepartment employees’ need to improve their work skills. It will also assist managers tocollect and select effective incentives from salaries, promotions, and bounces tomotivate employees to perform a new loan process, which delivers better service tocustomers. Communication between managers and employees is the key tounderstanding the main needs of our customers to get their satisfaction, as result ofwhich clients will remain loyal to the bank. However, customers will transfer to ourcompetitors when communication went to a wrong way, which will cause the bank todownsize and cuts jobs. Communication systems will allow facilities department’semployees to get an interest rate from treasury department more accessible, so thatthey are able to respond to customers fast. Communication will facilitate the how
  34. 34. Overcoming Resistance to Change 26approval of complicated loan issues between top level managers and employees torespond to a client in less time possible. A clear communication from managers will articulate to the employees whatpercentages should the productivity increased. Communicators could use most effectivemethods that are group meetings with managers from different levels and employeesfrom facilities department each month; memos to seek feedback, informal one to onetalk to deliver the goals setting of department.Institutionalization the of Organizational Change Establishing a new loan process to the employees and managers should plan tocreate a new loan process and explain how, when and why should implement the newloan process in order to ensure that employees would understand and support itstrongly. The factors of Institutionalizations that will allow the new loan process takeplace, as result will be implemented successfully. Planning and preparation is the first step to maintain origination rules in order toanalyze worker efficiency. Managers should be willing to listen to their employees’perspective in terms of the current loan process and what they think about a new loanprocess , also participating and involving the subordinates in the decision is to identifywhat is the new change would be and how the change is will be implemented. Timing isa significant factor to improve daily work task which will result in great attitude job.Therefore, when the timing of change is effective, then the employees would accomplishtheir mission in timely manner. Moreover, Mangers should articulate that loan changeprocess in clear, simple language to gain the consensus prior to implement a newprocedure in the work place.Participation and Involvement in the Decision Making The main function of the leaders in building mutual decision making is toanticipate employees’ needs in the implementation of the new loan process. Employees
  35. 35. Overcoming Resistance to Change 27will not embrace the new concept of change the current loan process unless theyparticipate in the decision of a new loan process the most effective plan leaders shouldconsider is to expand employees’ support to develop a new procedure in order to fulfillcustomers. Sharing information about customers’ satisfaction is to demonstrate toemployees the effectiveness of the current loan process. As result of that developingloan process is a smart preparation that would keep employees contribute efficiently to anew loan process. Managers or change’s agent involve the individuals who are reluctant to someaspect of the plan and implementation of the loan change process, they can often expectemployees who do not want to implement a new loan process. As result of that, listeningcarefully to employees who refuse to contribute to improve loan process and, if possible,implement their recommendations.Reward System Creating a wise reward system is the motivational key to increase employees’ownership at facilities department. Articulating the most significant advantages thatemployees would gain by implementing a new loan process is to give them a clearpicture to evaluate the situation. Reward system includes different aspects that arepayoff, recognition, and promotion. Employees should be considered as an important characteristic that willcontribute in the loan change process by the changers. Employees want to perform theirjob in a way they can receive their interests. Employees are willing to supporting the newloan process if they believe that they can get benefit from it. Substantially, rewards must be shaped to individuals carefully to fit their desires.Employees have different value some of whom, prefer recognition, favor payoff, otherschallenge, others honor, others occupation security and so on.
  36. 36. Overcoming Resistance to Change 28The relation between employees contribution efforts and loan change process must beprepared clear to individuals in order to encourage them implement the task effectively.Creating a short term program can reward employees who contribute effectively in thenew loan process in order to expend their loyalty
  37. 37. Overcoming Resistance to Change 29 ReferencesAtkinson, P. (2005). Managing resistance to change. Management Services, 49(1), 14- 19. Retrieved from Business Source Premier database.Bommer, W., Rich, G., & Rubin, R. (2005). Changing attitudes about change: The effects of transformational leadership on employee cynicism about organizational change. Journal of Organizational Behavior, 26(4), 733-353.Bryson, J. M. (1995). Strategic planning for public and nonprofit organizations. San Francisco, CA: Jossey-Bass.Carter, L. U., lrichby, D., & Goldsmith, M. (2005). Best practices in leadership development and organization change. San Francisco, CA: John Wiley & Sons, Inc.Fields,D.L. (2002). Taking the measure of work: A guide to validated scales for organizational research and diagnosis. Thousand Oaks, CA: Sage Publications.Furst, S., & Cable, D. (2008). Employee resistance to organizational change: Managerial influence tactics and leader-member exchange. Journal of Applied Psychology, 93(2), 453-462. Retrieved from Business Source Premier database.Geller, E. (2002). Leadership to overcome resistance to change: It takes more than consequence control. Journal of Organizational Behavior Management, 22(3), 29-49.Goodman, Paul S., Rousseau, & Denise M. (2005). Organizational change that produce results: The linkage approach. Academy of Management Executive, Vol. 18(3), 7-19.Gullickson, B. (2009). Working with resistance. Strategic Finance, 90(8), 9-10. Retrieved from Business Source Premier database.Harvey, T. R. (1995). Checklist of change. Lancaster, PA: Technomic Publishing Inc.Huang, C, & Huang, I. (2009). Resistance to change: The effects of organizational intervention and characteristic leadership. Review of Business Research, 9(1), 110-114.Jeffrey D. F., & Laurie W. F. 2009. Decoding resistance to change. Harvard Business Review 87, no. 4: 99-103. Retrieved from Business Source Premier database.Jones, G. R. (2010). Organizational theory, design, and change (6th ed.). Upper Saddle River, NJ: Pearson Education.Kotter, J. P., & Cohen D. S. (2002). The heart of change. Boston, MA: Harvard Business School Press.
  38. 38. Overcoming Resistance to Change 30Kotter, J. P., & Schlesinger, L. (2008). Choosing strategies for change. Harvard Business Review, 86(7/8), 130-139. Retrieved from Business Source Premier database.Lee, W. W., & Kraye, K. J. (2003). Organizing change: An inclusive, systemic approach to maintain productivity. Thousand Oaks, CA: Pfeiffer Co.Lefebvre, J. (1997). The battle for change. Mortgage Banking, 57(4), 58-58. Retrieved from Business Source Premier database.Lines, R. (2004). Influence of participation in strategic change: resistance, organizational commitment and change goal achievement. Journal of Change Management, 4(3), 193-215. DOI:10.1080/1469701042000221696.Mabin, V. J., Forgeson, S., & Green, L. (2001). Harnessing resistance: Using the theory of constraints to assist change management. Journal of European Industrial Training, Vol. 25(2), 168.Merisalo ,L.J. (2010). The challenges of change. Health Care Registration: The Newsletter for Health Care Registration Professionals, 19(4), 3-5. Retrieved from Business Source Premier database.Michelman , P. (2007). Overcoming resistance to change. Harvard Management Update, 12(7), 3-4. Retrieved from Business Source Premier database.Rubin, R., Munz, D., & Bommer, W. (2005). Leading from within: The effects of emotion recognition and personality on transformational leadership behavior. Academy of Management Journal, 48(5), 845-858.Strebel, P. (1996). Why do employees resist change?. Harvard Business Review, 74(3), 86-92. Retrieved from Business Source Premier database.Swindall, C. (2007). Engaged leadership building a culture to overcome employee disengagement. San Francisco, CA: John Wiley & Sons, Inc.
  39. 39. Overcoming Resistance to Change 31APPENDICES
  40. 40. Overcoming Resistance to Change 32Appendix (A)
  41. 41. Overcoming Resistance to Change 33 Appendix (B) CONSENT TO PARTICIPATE IN RESEARCH Leadership Skills to Overcome Resistance for Organizational Changes FOR MANAGERS AND EMPLOYEESYou are being asked to participate in a case study research conducted by MajidBakarman, from the Master’s in Leadership and Management Program at the Universityof La Verne as part of a culminating research project. You were selected as a possibleparticipant in this study because your experience in organizational change match meresearch criteria. PURPOSE OF THE STUDYThis study is designed to develop appropriate leadership skills to assist change’s agentsto implement organizational changes successfully. PROCEDURESLeadership skills overcome resistance to changeIf you decide to participate in this study, we will ask you to do the following things:Answer a brief survey consisting of10 questions in three categories. The categories are: Demographics (such as your age, experience, and how often you have been involvedin an organizational change) Questions related to your expectations of how organizational changes would behandled. POTENTIAL RISKS AND DISCOMFORTSThere is a slight risk of a breach of your confidentiality but every effort will be made tomaintain your identity and responses as confidential. PAYMENT FOR PARTICIPATIONThere is no payment for participation. CONFIDENTIALITYAny information that is obtained in connection with this study and that can be identifiedwith you will remain confidential and will be disclosed only with your permission or asrequired by law. Confidentiality will be maintained by means of Confidentiality will bemaintained by not publishing any identified information with any survey data. Completedsurveys will be kept away from the organization and will not be accessible to anyoneexcept Majid Bakarman.
  42. 42. Overcoming Resistance to Change 34 PARTICIPATION AND WITHDRAWALYou can choose whether to be in this study or not. If you volunteer to be in this study,you may withdraw at any time without consequences of any kind. You may also refuseto answer any questions you don’t want to answer and still remain in the study. IDENTIFICATION OF INVESTIGATORSIf you have any questions or concerns about the research, please feel free to contactMajid Bakarman, 347 755 0333, or my faculty sponsor,Dr. Deborah Olson, 909-593-3511 ext. 4579, RIGHTS OF RESEARCH PARTICIPANTSYou may withdraw your consent at any time and discontinue participation withoutpenalty. You are not waiving any legal claims, rights or remedies because of yourparticipation in this research study. If you have questions regarding your rights as aresearch participant, contact Fred Yaffe, PhD, Director of Institutional Research Board at909-593-3511, extension 4996 or (University of La Verne, 1950Third Street, La Verne, CA 91750).By completing the survey, I am giving my consent to participate in this research.
  43. 43. Overcoming Resistance to Change 35Appendix(C)
  44. 44. Overcoming Resistance to Change 36
  45. 45. Overcoming Resistance to Change 37Appendix (D)
  46. 46. Overcoming Resistance to Change 38
  47. 47. Overcoming Resistance to Change 39