1. INTRODUCTION
Change is inevitable in the life of an organisation. In today’s business world, most of the
organisations are facing a dynamic and changing business environment. They should
either change or die, there is no third alternative. Organizations that learn and cope with
change will thrive and flourish and others who fail to do so will be wiped out. The major
forces which make the changes not only desirable but inevitable are technological,
economic, political, social, legal, international and labour market environments. Recent
surveys of some major organizations around the world have shown that all successful
organizations are continuously interacting with the environment and making changes in
the structural design or philosophy or policies or strategies as the need be.
According to BARNEY AND GRIFFIN, “the primary reason cited for organizational
problems is the failure by managers to properly anticipate or respond to forces for
change.”
Thus in a dynamic society surrounding today’s organizations, the question whether
change will occur is no longer relevant. Instead, the issue is how managers cope with the
inevitable barrage of changes that confront them daily in attempting to keep their
organizations viable and current. Otherwise the organizations will find it difficult or
impossible to survive.
MEANING OF CHANGE
In very simple words, we can say that change means the alteration of status quo or
making things different. “The term change refers to any alterations which occurs in the
overall work environment of an organisation.”
“When an organizational system is disturbed by some internal or external force, change
frequently occurs. Change, as a process, is simply modification of the structure or process
of a system. It may be good or bad, the concept is descriptive only.”
From the above definitions, we can conclude that change has the following
characteristics:
1. Change results from the pressure of both internal and external forces in the
organisation. It disturbs the existing equilibrium or status quo in the organisation.
2. The change in any part of the organisation affects the whole of the organization.

2. 3. Change will affect the various parts of the organizations in varying rates speed
and degrees of significance.
4. Change may affect people, structure, technology and other elements of the
organisation.
5. Change may be reactive or proactive. When change is brought about due to the
pressure of external forces, it is called reactive change. Proactive change is
initiated by the management on its own to increase organizational effectiveness.
FORCES FOR CHANGE
There are a number of factors both internal and external which affect organizational
functioning. Any change in these factors necessitates changes in an organisation. The
more important factors are as follows:
EXTERNAL FORCES
Every organization exists in some context; no organization is an island in itself. Each
must continually interact with other organizations and individuals- the consumers,
suppliers, unions, shareholders, government and many more. Each organization has goals
and responsibilities related to each other in the environment. The present day
environment is dynamic and will continue to be dynamic. Changes in social, political,
economic, technology, and legal environment force organizations to change themselves.
Such changes may result in organizational changes like major functions production
process, labour-management relations, nature of competitions, economic constraints,
organizational methods etc. In order to survive in the changing environment, organization
must change. How the change in various environmental, organizations, must change.
How the changes in various environmental factors necessitate change in the organization
may be seen in following context:-
1. Technology:
when there is a change in technology in the organizational
environment and other organizations adopt the new technology, the organizations
under focus become less cost effective and its competitive position weakens.
Therefore, it has to adopt new technology, its work structure is affected and a new
equilibrium has to be established.

3. 2. Marketing
conditions: Since every organization exports its outputs to the
environment, an organization has to face competition in the market. There may be
two types of forces which may affect the competitive position of an organization
–other organizations supplying the same products and, buyers who are not buying
the product. Any changes in these forces may require suitable changes in the in
the organization. For example, when Indian economy was liberalized, there were
many foreign organizations that entered the Indian market. This forced many
Indian organizations to realign themselves with the new situations. The result in
that there have been many cases of divesting the business and concentrating on
the core business, acquiring core business, and developing competitive
competence to face competitive threats. Similarly, there may be changes in buyers
in terms of their needs, liking –disliking and income disposal for a product. These
changes from the organizations to bring those products which meet buyer’s
requirement.
3. Social changes: Social changes reflect in terms of people’s aspirations, the needs,
and their ways of working. Social changes have taken place because of the several
forces like level of education, urbanization, feeling of autonomy, and international
impact due to new information sources. These social changes affect the behavior
of people in the organization. There, it is required to make adjustment in its
working so that it matches with people.
4. Political
and legal changes: Political and legal factors broadly define the
activities which an oganisation can undertake and the methods which will be
followed by it in accomplishing those activities. Any changes in these political
and legal factors may affect the organization operation.

4. INTERNAL FORCES
It is not only the changes in external factors, which may necessitate organizational
changes; any change in organization’s internal factors may also necessitate changes. Such
a change is required because of two reasons: changes in managerial personnel and
deficiency in existing organizational practices.
1. Changes in the managerial personnel: Besides environmental changes there is a
change in managerial personnel. Old managers are replaced by new mangers,
which necessitated because of retirement, promotion, transfer or dismissal. Each
new manager brings his own ideas and way of working in the organization. The
relationships, more in the organization. The relationships, more particularly
informal ones, changes because of changes in managerial personnel. Moreover,
attitude of the personnel change even though there is no changes in them. The
result in that an organization has to change accordingly.
2. Deficiency in Existing organization: Sometimes, changes are necessary because
of deficiency in the present organizational arrangement ad process. These
deficiencies may be in the form of unmanageable span of management, large
number of managerial levels, lack in co-ordination between various departments,
obstacles in communication, multiplicity of committees, lack of uniformity in
policy decisions, lack of cooperation between the line and staff, and so on. Beside
these internal factors, there are two more internal factors that give rise to
organizational changes.
3. Nature of the work force: The nature of work force has changed over a passage
of time. Different work values have been expressed by different generations.
Workers who are in the age group of 50 plus value loyalty to their employers.
Workers in their mid thirties to forties are loyal to themselves only. The youngest
generation of workers is loyal to their career.
The profile of the workforce is also changing fast. The new generation of workers
has better educational; they place greater emphasis on human values and
questions authority of managers. Their behavior has also become very complex

5. and leading them towards organizational goals is a challenge for the managers.
The employee turnover is also very high which again put strain on the
management.
4. To avoid developing inertia: In many cases, organizational changes take place
just to avoid developing inertia or inflexibility. Conscious manager take into
account this view of organization that organization should be dynamic because
any single method is not the best tool of management every time. Thus, changes
are incorporated so that the personnel develop liking for change and there is no
unnecessary resistance when major change in the organization are brought about.
TYPES OF CHANGE
The various types of changes are:
1. INDIVIDUAL LEVEL CHANGE
Individual level changes may take place due to changes in job assignment,
transfer of an employee to a different location or the changes in the maturity level
of a person which occurs over a passage of time. The general opinion is that
change at the individual will not have the significant implications for the
organization. But this is not correct because individual level changes will have
impact on the group which in turn will influence the whole organization.
Therefore, a manager should never treat the employees in isolation but he must
understand that the individual level change will have repercussions beyond the
individual.
2. GROUP LEVEL CHANGE
Management must consider group factors while implementing any change,
because most of the organizational changes have their major effects at the group
level. The groups in the organization can be formal groups or informal groups.
Formal groups can always resist change for example; the trade unions can very
strongly resist the changes proposed by the management. Informal groups can
pose a major barrier to change because of the inherent strength they contain.
Changes at the group level can affect the work flows, job design, social
organization, influence and status systems and communication patterns.

6. The groups, particularly the informal groups have a lot of influence on the
individual members of the group. As such by effective implementing change at
the group level, resistance at the individual level can be frequently overcome.
3. ORGANISATIONAL LEVEL CHANGE
The organizational change involves major programmes which affect both the
individuals and the groups. Decisions regarding such changes are made by the
senior management. These changes occur over long periods of time and require
considerable planning for implementation. A few different types of organization
level changes are:
i.
Strategic change. Strategic change is the change in the very basic
objectives or mission of the organization. A simple objective may have to
be changed to multiple objectives. For example, a lot of Indian companies
are being modified to accommodate various aspects of global culture
brought in by the multinational or transnational corporations.
ii.
Structural change. Organizational structure is the pattern of relationships
among various positions and among various position holders. Structural
change involves changing the internal structure of the organization. This
change may be in the whole set of relationships, work assignments and
authority structure. Change in organization structure is required because
old relationships and interactions no longer remain valid and useful in the
changed circumstances.
iii.
Process oriented change. These changes relate to the recent technological
developments, information processing and automation. This will involve
replacing or retraining personnel, heavy capital equipment investment and
operational changes. All this will affect the organizational culture and as a
result the behaviour pattern of the individuals.
iv.
People oriented change. People oriented changes are directed towards
performance improvement, group cohesion, dedication, and loyalty to the
organizations as well as developing a sense of self-actualisation among

7. members. This can be made possible by closer interaction with employees
and by special behavioural training and modification sessions.
To conclude, we can say that changes at any level affect the other levels. The strength of
the effect will depend on the level or source of change.
MANAGING PLANNED CHANGE
A planned change is a change by the organization; it does not happen by itself. It is
affected by the organization with the purpose of achieving something that might
otherwise by unattainable or attainable with great difficulty. Through planned change, an
organization can achieve its goals rapidly. The basic reasons for planned change are:

To improve the means for satisfying economic needs of members

To increase profitability

To promote human work for human beings

To contribute to individual satisfaction and social well being
The planned change process may comprise, basically the three following steps:
1. Planning for change
2. Assessing change forces
3. Implementing the change
PLANNING FOR CHANGE
The first step in the process of change is to identify the need for change and the area of
changes as to whether it is a strategic change, process oriented change or employee
oriented change. This need for change can be identified either through internal or external
factors. Once this need is identified the following general steps can be taken:
i.
Develop new goals and objectives. The manager must identify as to what new
outcomes they wish to achieve. This may be modification of previous goals due to
changed internal and external environment or it may be a new set of goals and
objectives.
ii.
Select an agent of change. The next step is that the management must decide as
to who will initiate and oversee this change. One of the existing managers may be

8. assigned this duty or even sometimes specialists and consultants can brought in
from outside to suggest the various methods to bring in the change and monitor
the change process.
iii.
Diagnose the problem. The person who is appointed as the agent of the change
will then gather all relevant data regarding the area of problem or the problem
where the change is needed. This data should be critically analysed to pinpoint the
key issues. Then the solutions can be focused on those key issues.
iv.
Select Methodology. The next important step is to select a methodology for
change; employee’s emotion must be taken into consideration when devising such
methodology.
v.
Develop a plan. After devising the methodology, the next step will be to put
together a plan as to what is to be done. For example, if the management wants to
change the promotion policy, it must decide as to what type of employees will be
affected by it, whether to change the policy for all the departments at once or to
try it on a few selected departments first.
vi.
Strategy for the implementation of the plan. In this stage, the management
must decide on the ‘when’, ‘where’ and ‘how’ of the plan. This includes the right
time of putting the plan to work, how the plan will be communicated to the
employees in order to have the least resistance and how the implementation will
be monitored.
ASSESSING CHANGE FORCES
The planned change does not come automatically, rather there are many forces in
individuals, groups and organization which resist such change. The change process will
never be successful unless the cooperation of employees is ensured. Therefore, the
management will have to create an environment in which change will be amicably
accepted by people. If the management can overcome the resistance, change process will
succeed.
In a group process, there are always some forces who favour the change and some forces
that are against the change. Thus, an equilibrium is established is maintained. Kurtlewin
calls in the “field of forces”. Lewin assumes that in every situation there are both driving
and restraining forces which influence any change that may occur.

9. Driving forces are those forces which affect a situation by pushing in a particular
direction. These forces tend to initiate the change and keep it going.
Restraining forces act to restrain or decrease the driving forces.
Equilibrium is reached when sum of the driving forces equals the sum of the restraining
forces as shown in the following figure:
Force Field Analysis
Current state: Forces
maintaining a status quo
Desired state
Restraining /
Pushing forces
pulling forces
After Kurt Lew in
There may be three types of situations, as both driving and restraining forces are
operating:
i.
If the driving forces far out weight the restraining forces, management can
push driving forces and overpower restraining forces.
ii.
If restraining forces are stronger than driving forces, management either
gives up the change programme or it can pursue it by concentrating on
driving forces and changing restraining forces into driving ones or
immobilizing them.
iii.
If driving and restraining forces are fairly equal, management can push up
driving forces and at the same time can convert or immobilize restraining
forces.

10. Thus, to make the people accept the changes, the management must push driving forces
and convert or immobilize the restraining forces.
IMPLEMENTING CHANGE
Once the management is able to establish favourable conditions, the right timing and
right channels of communication have been established the plan will be put into action. It
may be in the form of simple announcement or it may require briefing sessions or in
house seminars so as to gain acceptance of all the members and specify those who are
going to be directly affected by the change.
After the plan has been implemented there should be evaluation of the plan which
comprises of comparing actual results to the objectives. Feedback will confirm if these
goals are being met so that if there is any deviation between the goals and actual
performance, corrective actions can be taken.
CHANGE PROCESS
Any organizational change whether introduced through a new structural design or new
technology or new training programme, basically attempts make employees change their
behaviour. Unless the behavioural patterns of the members change the change will have a
little impact on the effectiveness of the organization. Behavioural changes are not
expected to be brought about overnight. These are the most difficult and marathon
exercises.
A commonly accepted model for bringing about changes in people was suggested by
KURT LEWIN in terms of three phase’s process:1. Unfreezing
2. Changing
3. Refreezing
1. Unfreezing
Unfreezing means that old ideas and attitudes are set aside to give place to new ideas. It
refers to making people aware that the present behaviour is inappropriate, irrelevant,
inadequate and hence unsuitable for changing demands of the present situation.

11. According to EDGAR SCHIEN the following four elements are necessary during this
unfreezing phase:•
The physical removal of the individuals, being changed from their accustomed
routines, sources of information and social relationships.
•
The undermining and destruction of social support.
•
Demeaning and humiliating experience to help individuals, being changed, to see
their old attitudes or behaviour as unworthy and think to be motivated to change.
•
The consistent linking of reward with willingness to change and of punishment
with willingness to change.
Unfreezing thus involves discarding the orthodox and conventional methods
and introducing dynamic behaviour, most appropriate to the situation. People are
made to accept new alternatives.
2. Changing
Unlike unfreezing changing is not uprooting of the old ideas, rather the old ideas are
gradually replaced by the new ideas and practices. In changing phase new learning
occurs. The necessary requirement is that various alternatives of behaviour must be made
available in order to fill the vacuum created by unfreezing phase. During the phase of
changing, individuals learn to behave in new ways, the individuals are provided with
alternatives out of which choose the best one.
KELMAN explains changing phase in terms of the following elements: Compliance: - it occurs when individuals are forced to change either by reward or
by punishment.
 Internalisation: - it occurs when individuals are forced to encounter a situation and
calls for new behaviour.
 Identification: - it occurs when individuals recognize one among various models
provided in the environment that is most suitable to their personality.
3. Refreezing
Refreezing is on the job practice. The old ideas are totally discarded and new ideas are
totally accepted. Refreezing reinforced attitudes, skills and knowledge. He practices and

12. experiments with the new method of behaviour and sees that it effectively blends with his
other behavioural attitudes.
FERSTER and SKINNER have in this connection introduced the main reinforcement
schedules namely- Continuous and Intermittent reinforcements. Under continuous
reinforcement individuals learn the new behaviour within no time. And intermittent
reinforcement on the other hand, consumes a long time but it is has the greatest advantage
of ensuring a long lasting change.
CHANGE AGENTS
Change agents are the persons who initiate change and
manage change in the
organizations. They are specialized in theory and practice of managing changes. The
change agent may be a member of organization or an outsider such as a consultant. An
internal agent very well knows the organization and have ability, knowledge and
experience of directing people for changes. But, internal agent is removed from regular
duties to concentrate on the transition. However, external agents view the organization
from the system point of view and is much affected by the organization norms. Top
managers also prefer hiring specialized consultant change agents as they can offer more
objective prospective than insiders. External experts are, however, not well aware of the
desires and attributes of the employees, therefore, the changes suggested by them are
generally resisted by the employees.
Change agents have five set of powers as support of managers is essential but not enough.
Following are the powers,
1. High status given by the members of the client organization, based on their
perception that the change agent is similar to them in behaviour, language etc.
2. Trust based on his consistent handling of information and maintaining proper role
in the organization.
3. Expertise in the practice of organizational change.
4. Credibility based on experience with previous clients.

13. 5. Dissatisfied constitutions who see the change agents as the best opportunity to
change the organization to meet their needs.
CHANGE OPTIONS
There are four subject matters which a change agent can change.
Structure
Structure is defined as how the tasks are formally divided, grouped and co-ordinated. For
inastance, change in plant layout or new technique can only succeed when the structure is
changed according to change in environment. He may also change responsibility,
authority, functions, performance according to the need of the change. He might also
redesign jobs or work schedule.
Technology
The introduction of new equipment and work process is technological change.
Automation or computerization is the common technological change. Major
technological changes involve introduction of new tools and equipment, automation,
computerization.
People
This involves changing attitudes and behaviour of members thorugh communication,
decision making and problem solving. They help individuals to work more efficiently and
effectively together. The changes may only be possible in case the members are positive.
In case there is lack of agreement, stress and tension occurs with the employees.
Physical Setting
It involves change in interior design, equipment placement, plant layout, tool placement.
These changes are helpful in organizational development. Physical setting considers flow
process, information flow and outcome. The smoothness of flow increases the
effectiveness of changes.

14. The basic objective of change agents is to increase effectiveness, performance and
satisfaction.
ACTION RESEARCH
An organizational change based on research contributing towards betterment of the
sponsoring organization. In this, generally the agent is an outside person, involved in total
process from diagnosis to evaluation. This person contracts with the sponsoring to engage
in research. Action research consists of five steps as explained below:
Diagnosis
The agent gathers information about problem, anxiety and required problems by asking
questions, interviews, review of records and listening to employees. It helps to find what
actually the problem is.
Analysis
The gathered information is analysed. The consistency and pattern of problem is studied.
Feedback
The agent shares with the employees what has been done in steps one and two. Thus,
employees will be actually involved in change programme. In participation of employees
the change agent develops action plan for bringing the required change.
Action
Plans decided in the previous step are set in motion. Required action is taken to correct
the problems identified.
Evaluation
In this step the agent evaluates the effectiveness of action plans. Using initial data as
benchmark any subsequent changes can be compared and evaluated.

15. Action research is a problem focus based method. The agent decides the action on the
basis of the identified problem.
HUMAN REACTION TO CHANGE
There is a very close relationship between change and human attitudes. Every individual
reacts to the change according to their individual attitude. Human reaction to change does
not depend upon logic. Generally, depends upon how a change will affect ones needs and
satisfaction in the organization. Attitudes are very important in determining the resistance
to change.
The reaction to change any occur in any of the following forms,
ACCEPTANCE
Acceptance of the change depends on the perception of the employees towards the
change. So, all the changes are not necessarily restricted. If an employee perceives that
the change will affect his/her favorably, then he/she will accept the change. For example
if workers have to stand before a machine throughout the shift, they will like the
introduction of new machine which will allow them to sit while working.
RESISTANCE
All the changes are not necessarily resisted. Resistance to change arises due to deferring
perception, personalities and needs. If the employee perceives the change is unfavorable
to them, they resist to the change. Individual generally feel comfortable in the
environment that they are habituated to. So, when the change arises, the thought of
moving from the environment they are accustomed to become a source of resistance.
Human resistance to change may be in any of following forms,
1.
Hostility or Aggression.
Hostility or aggression is the immediate reaction if an individual to change.
Hostility can be expressed verbally, but the combined form of hostility and
aggression is of a more intense character and can also take physical forms.

16. 2.
The individual may develop lack of interest towards has work. If individual do
not like the change it may result to spoilage of materials, idling of time and
decline in performance. This will alternately decrease this efficiency in work.
3.
Employee remains absent in their work as well slow performance in their work.
4.
Employee find themselves uncomfortable, shaky and tensed on the job.
Resistance develops anxiety and tension in the employee.
5.
Strikes are usual symptoms of the group resistance.
INDIFFERENCE
In some cases changes in the organization or environment fails to bring the reaction of
the employee. There are two reaction to change, acceptance & resistance, but in some
cases there is no reaction. This is because sometimes employee fails to realize the impact
of change or some people feel that they will not be affected by the change. In both these
cases there is no reaction to the change, so they will remain indifferent to change.
FORCED ACCEPTANCE
Employee or the people may resist to the change in initial state but if he changes force are
stronger the resistance force, then they have to accept the change. This is known as
forced acceptance of the change. This is known as forced acceptance of the change.
KEITH DAVIS absorbed that “People develop an established set of relations with their
environment. They learn how to deal with each other, how to perform their job and what
to expect next. Equilibrium exists, individuals are adjusted when change comes along,
and it requires individuals to make new adjustments, as the employee seeks a new
equilibrium. When employees are unable to make adequate adjustment to change which
occur, the organization is a state of imbalance or disequilibrium. Managements general
human relations objective regarding change is to restore and maintain the group
equilibrium and personal adjustment which change upsets.”
CAUSES OF RESISTANCE TO CHANGE
The main reasons for resistance to change are both individual and organization. The
research document of individual and organizational behavior has found that organization

17. groups and individuals resist change. Resistance to change provides a degree of stability
and predictability to behavior, as it does not allow immediate change. If there was no
resistance to change the organization will take on characteristics of chaotic randomness.
There may be reasons for resistance to change for analytical purpose, lets us categories
the causes into the following.
1. Individual Resistance.
2. Group Resistance.
3. Organizational Resistance.
INDIVIDUAL RESISTANCE
Individual arise due to differing perceptions, personalities and needs. Some of these
reasons appear to be rational and emotional. These reasons are listed below,
ECONOMIC FACTORS
The economic reasons for the resistance to change may be the following:
i.
In organization when the development or change on technology takes place,
employee resists the change. Employee may fear that the change will lead to
technological unemployment. Generally, new technology is associated with
education of labor intake and therefore they resist the change. For example the
introduction of computer in an organization means that employee will have to
learn the certain package to work efficiently. They may not be liked by some
employees and they develop negative attitude towards computer and resist them.
ii.
In organization where pay is tied to productivity individuals usually resists change
as they fear that they will not be able to perform new task effectively, thus
causing a decline in productivity and a decrease in their income.
iii.
Workers may fear that they will be demoted if they do not acquire the skills
required for the new jobs.
iv.
Workers resist the changes which lead to high standards which in turn may reduce
the opportunities for bonus or incentive pay.

18. Habit
All human being are creatures of habit. Individual generally feel comfortable in the
environment that they are habituated to. The modern life is very complex and no one
likes to consider the full range of option for the hundreds of decision which has to be
made everyday. Instead we rely on habit or programmed responses. When confronted
with change, the thought if moving away from the environment they are accustomed to
become a source of resistance.
Insecurity
Safety and security are high priority for every individual. One of the major reasons for
resistance to change is uncertainty about the impact of change, especially on the job
security. When employees feel that the security of the job is threatened by change, they
resist it. The fear unknown always has a major impact on the decision of the individual.
Lack of Communication
If the workers are given an opportunity to participate in the process of change, the
resistance is likely to be less. But if the change is not properly communicated that to in an
acceptable manner to the employees, it is likely to cause resistance.
Extent of Change
If there is a minor change and the change involves only the routine operations the
resistance will be minimum or no resistance. But incase of major changes like reshuffling
of staff will lead to major visible resistance. Similarly the process of change is slow, the
resistance will be less as compared to rapid or sudden change.
PSYCHOLOGICAL FACTORS

19. One of the major reasons for resistance can be emotional turmoil that a change may cause
especially if the past experiences with the change have not been positive. The
psychological reasons for the resistance to change are:
1.
Workers may have the fear that the new job will bring boredom and monotony as
a result of specialization brought by the new technology.
2.
Change in technology brings new method of doing the job and it must be learnt
and adopt the new ideas of doing the job. To learn these ideas they need work
hard and they do not want to take the trouble in learning new things.
3.
The workers may be incapable of understanding the implications of new ideas and
method.
4.
Workers may not like criticism implied in a change that the present method is
inadequate and unsuitable.
5.
New changes may lead to reduction of the personal pride of the workers because
they fear that new work changes will do away with the need for much manual
work.
SOCIAL FACTORS
Every individual have social needs like friends, belongingness, etc. In organization, while
working employee develop social relationship with the other employees. They become
members of certain informal group. The change will bring a fear in mind of people
because generally people dislike with for new adjustment, breaking present social
relationship reduce social relationship, feeling of outside interference in the form change
agent etc.
GROUP RESISTANCE
While working in an organization the employee form informal group in the organization.
The most organizational change has impact in informal group in the organization.
Breaking up a close knit work group or changing social relationship can provoke a great
deal of resistance. The main reason why the groups resist change is that they fear that
their cohesiveness or existence is threatened by it. This is particularly true in case of

20. group which are very cohesive where people have a strong case of belongingness to
group and where member consider the group as superior to the other groups.
ORGANISATIONAL RESISTANCE
Organizational resistance means that the change is resisted at the level of the
organizational itself. Some organizations are so designed that they resist new ideas, this is
specifically true in case of organizations which are conservative in nature. Government
agencies want to continue doing what they have been doing for a number of years even
though there is need for the change in their services. Majority of the business firms are
also resistant to changes. The major reasons for organizational resistance are:
1. Threat to Power. Top management generally considers change as a threat to
their power and influence in the organization due to which the change will be
resisted by them. The introduction of participative decision making or selfmanaged work teams is the kind of change which is often seen as threatening by
the middle and top level management.
2. Group inertia. Sometimes, the individuals resist change because the group to
which they belong resists it. The degree and force of resistance will depend upon
how loyal one is to the group and how effectively the group resists the change.
3. Organizational structure. Change is often resisted by the bureaucratic
structures where jobs are narrowly defined, lines of authority clearly spelled and
flow of i9nformation is stressed from top to bottom. Moreover, organizations are
made up of a number of interdependent subsystems, one system cannot be
changed without affecting the others.
4.
Threat to specialization. Change in organization may threaten the expertise of
specialized groups. For example, giving computer training to all the employees in
the organization and giving personal computers was perceived as a threat by the
experts in computer department of the organization.
5. Resource constraints. Organizations need adequate financial resource for
training change agents and for offering rewards to those who support change. An
organization who does not have resources for implementing the change resists it.

21. 6. Sunk cost. The change is generally resisted by the top management because it
often leads to the problem of sunk costs. The heavy capital which already
invested in the fixed assets or the amount which has already been spent on the
training of the employees will go waste if the change is introduced.
OVERCOMING RESISTANCE TO CHANGE
Problem of overcoming resistance to change can be handled at two levels:1. At the individual level.
2. At the group level through group dynamics.
EFFORTS AT THE INDIVIDUAL LEVEL
The management can use the following strategies to overcome resistance by the people
and to introduce changes successfully:
1. Participation and Involvement
Individual will find it difficult to resist the change which they participated. Prior to
making a change, all those persons who are going to the affected by the change, can
be brought into the decision making process. Their doubts and objectives should be
removed to win their cooperation. Getting opinions out in the open, so that they are
looked at and evaluated is an important trust building task. This involvement of the
workers can overcome resistance, obtain personal commitment and increase the
quality of the change decisions. But this method may lead to a lot of time
consumption as well as it may be a potential for poor solutions.
2. Effective Communication
Inaccurate information can be a reason for the resistance to change. An appropriate
communication program can help in overcoming this resistance. Workers can give
necessary education about the change, its process and its working through training
class, meeting and conferences. The reasons about change must be communicated
very clearly and without ambiguity. Communication can help dissipate some fear of
unknown elements. Management should also see that there is a two way
communication between the management and workers so that the so former comes to

22. know about the reactions of the latter directly without delay. All this will help
persuade employees about the necessity of change and once persuaded they may
actively want to have the change.
3. Facilitation and support
Change agents can offer facilitation and supportive efforts to overcome resistance.
Facilitative support means removing physical barriers in implementing change by
providing appropriate training, tools, machinery etc.
Supportive efforts include listening, providing guidance, allowing time off after a
difficult period and providing emotional support. Emotional support is provided by
showing personal concern to the employees during periods of stress and strain.
The drawback of this method is that it is time consuming and expensive and its
implementation offers no assurance of success.
4. Leadership
Leadership plays an important role in overcoming resistance to change. A capable
leader can reinforce a climate of psychological support for change.
The greater me prestige and credibility of the person who is acting as a change agent,
the greater will be the influence upon the employees who are involved in the change
process. A strong and effective leader can exert emotional pressure on his
subordinates to bring about the desired change. Most of the times, there is no
resistance from the subordinates and if they resist, the leader tries to overcome
resistance by leadership process.
5. Negotiation and Agreement
Negotiation and Agreement technique is used when costs and benefits must be
balanced for the benefit of all concerned parties. If people or groups are losing
something significant in the change and if they have enough power to resist strongly.
Negotiation before implementation can make the change go much more smoothly,
even if at the later stages if some problems arise, the negotiated agreement can be
referred to.

23. 6. Manipulation and Cooptation
This method is used in the situation, where other methods are not working or are not
available. Managers can resort to manipulation of information, resources and favours
to overcome resistance. Or they can resort to cooptation which means to co-opt an
individual, perhaps a key person with in a group, by giving him a desirable role in
designing or carrying out the change process. This technique has some doubtful ethics
and it may also backfire in some cases.
7. Coercion
Managers may resort to coercion if all other methods fail or for some reason are
inappropriate. Coercion may be in form of explicit or implicit threats involving loss
of jobs, lack of promotion and the like. Managers sometimes dismiss or transfer
employees who stand in the way of change. Coercion can seriously affect employee’s
attitudes and have adverse consequences in the long run.
8. Timing of Change
Timing of introduction of change can have a considerable impact on the resistance.
The right time will meet less resistance. Therefore, management must be very careful
in choosing the time when the organizational climate is highly favourable to change.
An example of right time is immediately after a major improvement in working
conditions.
EFFORTS AT THE GROUP LEVEL
A group is a cluster of persons related in some way by common interests over a period of
time. Members of the group interact with each other and develop group cohesiveness
among themselves. That is why although change can be obtained individually; it is more
meaningful if it is done through group. Therefore, management should consider the group
and not the individual as the basic unit of change. Group dynamics offer some basic help
in the regard.
Darwin Cartwright has identified the following characteristics of group as a means of
overcoming resistance to change:

24. •
If both the change agent and the people target for change belong to the
same group, the role of group is more effective.
•
If the people have more cohesiveness and strong belonging to the group,
change is easier to achieve.
•
The more attractive the group is to the numbers, the greater is the
influence of the group to accept or resist a change.
•
Group can exert pressure on those factors of the members which are
responsible for the group being attractive to the members. Normally
attitudes, values and behaviour are more common factors determining the
group attractiveness.
•
The degree of prestige of a group, as interpreted by the members will
determine the degree of influence the group has over its members.
•
If any attempt is made to change any individual or some individuals who
deviates the group norms there is likelihood of the change attempt being
resisted by the group.
Thus, the management should consider the group as the basic unit of change. Group
interactions should be encouraged; it should be provided full information by the
management. The management should also explain the rationale of change and try to
convince that the interests of the group members would not be adversely affected. Group
dynamics also help in providing various training programmers for accepting and
implementing change.
The Obstacles to Innovation
There are a number of obstacles to realizing and profiting from innovation to the fullest.
Among these are; the tendency to fight over recognition for one’s individual innovations,
the development and guarding of “industrial voodoo”, the risk that time and energy will
be spent on innovations that are not relevant to the company’s central purpose, and the
risk that an innovation will be over- or underestimated in a way that will result in
mismanagement and cause a financial loss or a lost opportunity.
Fighting Over Recognition
Wilbur and Orville Wright locked up their airplane for 5 or 6 years while they tried to
lock up commercial contracts. They did not allow anyone to see it. They soaked up
information from others but did not share their detailed drawings. Some feel that this may

25. have caused companies that otherwise would have been interested in the new invention to
be distrustful of it.
The Wright Brothers’ rival Glen Curtis in Hammondsport, New York; meanwhile,
developed another airplane called the June Bug. Curtis was the first to sell an airplane to
another person, the first to fly from one city to another, and the first to obtain a pilot’s
license. Curtis believed in open, shared access to innovation. He collaborated with others
to solve problems and make improvements to his airplane, and was much more
commercially successful, although much less known by history.
The Wright brothers sued Curtis for violating their patent, and it became an ugly personal
feud. Many historians feel that Orville Wright’s insistence on enforcing his patent, and
forcing both companies to devote their time to court battles rather than concentrating on
innovation and on their businesses may have put the United States behind in military
positioning for World War I.
The US Government finally paid off both companies to quit suing one another and get on
with building airplanes to help with the war effort. Had the legal wrangling continued, the
United States would not have had an air force during World War I, and things might have
turned out very different.
This is an example that approximates what happens in many companies to a greater or
lesser extent. People guard their own innovations and ideas carefully, fearing that sharing
them will rob them of the recognition for their creativity and hard work. There is a risk
that people will take their best ideas to a competing company where they feel they will be
recognized and compensated, or to start their own business in competition with yours.
They cause untold damage in terms of lost opportunities and time and energy spent
fighting with co-workers rather than collaborating.
“Industrial Voodoo”
A closely related phenomenon to overt fights over ownership of a particular innovation is
“Industrial Voodoo” or those small secrets that any experienced worker tends to acquire.
These are tools and methods that are not in any procedure manual that improve
productivity and are used to improve individual performance.
The Wall Street Journal recently ran a story on a manufacturing plant that was trying to
find out the “secrets” of a machinist who could retool a machine in half the time that
other workers were taking to do the same job.
The machinist refused to share his secret. He felt that if his methods became common
knowledge and standard practice in the company, it would remove his own competitive
edge over other machinists, raise the company’s expectations for performance, and “have
us running all day long” without any added compensation.
Experienced workers tend to collect knowledge about how to do their job better and
faster than everyone else, and they may or may not share this information with other
workers. The ethical question about this “industrial voodoo” is this: is this knowledge
(acquired through the workers’ own intelligence, innovation, experience and sweat)
owned by the worker or by the company that is paying them for their time? (The LEGAL

26. answer to this question, in the United States, is that the company owns this knowledge.
The ethical and practical questions remain.)
Irrelevant Innovations
One of the problems with allowing the time and space to think out of the box is that
sometimes workers come up with innovations that are of questionable relevance to their
jobs and to the bottom line of the company.
One IT manager was irritated by innovation. The software developers working for him
were continually coming up with “cool” things that were flashy or interesting from an
academic point of view, but didn’t significantly contribute to the company’s products or
services. “I don’t want to be paying people to be inventing better paper airplanes on
company time. We have a hard enough time meeting the deadlines we have. I wish they
would put their energy into the task at hand.”
The developers were exercising some very natural urges to experiment with technology
and supplement their training, the problem was that they were obviously out of step with
their manager’s priorities and deadlines, and his views on how company time and
equipment should be used.
Booms and Busts
Even successful innovations cause incredible booms and busts. People under- or overestimate the importance and potential profits of innovations. Electricity, the railroad, the
telephone, the fax machine, the 8 track tape, and the Internet are all examples of the
chaos that new innovations can cause for people who work with and/or invest in them.
The larger an innovation is, (that is, the greater potential gain) the more difficult it can be
to manage. More people get involved, more money is staked, and more is put at risk.
A Framework for Innovation
In order to capitalize on the innovative capacities within your company, you have to
provide some basic elements that foster it in your organization. The way that you provide
these elements can be formal or informal, and adapted to the size and nature of your
company, but they must be present in some form to truly encourage and leverage
innovation. They are direction and alignment between the goals of the individuals and the
company, a safe environment to take risks and share ideas, and a compensation system
that recognizes and rewards innovation and its close cousin, collaboration.
Direction and Alignment
The best place to start is to ensure that everyone in your company has a “line of sight”
from their individual job to their department’s goals to the company’s mission. There are
so many people in the workplace that simply follow the directions of their superiors
without any idea of how their work will be used. Understanding the larger picture of how
the products of their work will be used gives people a perspective to think creatively.
They may come up with better ways of meeting their work requirements, or moving
beyond them.

27. In the “Industrial Voodoo” section, there is a clear example of opposition rather than
alignment. The machinist felt that his goals were different (even opposed!) to the
company’s goals. This is an intolerable situation brought about, probably, from years of
history that told the machinist he couldn’t trust the company and that “anything he said
would be used against him” for the company’s profit but not his own.
A correction in that case would involve time and trust built up on both sides. We’ll talk
about this example in more detail when we talk about compensation.
A Safe Environment
Innovation involves risk. There is the risk that the idea will fail. There is also the risk of
having one’s ideas “stolen,”
The free marketplace has some checks and balances that help manage risk – the stock
market spreads the risk among many stockholders, who make decisions based on their
knowledge and experience (or that of their brokers.) Bankruptcy laws and corporate
entities in the United States are set up to have various levels of risk protection – an
entrepreneur who starts a business based on an innovation that turns out to be a flop has
some protection from being financially ruined for life. The penalties for failure are
mitigated somewhat so that this person may eventually go on to improve his idea and
become a raging success.
Your company can provide similar checks and balances to make sure ideas have venues
to be aired, evaluated for risk, and implemented in a responsible way that compensates
the individual for his contribution but doesn’t punish too harshly for an idea that doesn’t
work out for whatever reason. Having a Research and Development board that receives
ideas from employees can be similar to the patent or copyright function. This board can
also launch individual special projects to further explore or implement ideas. The
originator of the idea should be involved in this process whenever possible to ensure
continuity and morale. The board should include a variety of members, including legal,
accounting, marketing and other skills to ensure that the idea aligns well with the
company’s direction.
For innovations to be truly exploited, they need to be shared. Great developments by lone
inventors, such as Thomas Edison, are largely of the past- most truly great inventions of
today are the result of collaborations. Ideas are usually just starting points. They need to
be refined, augmented, and merged with other ideas.
Having common goals with co-workers, aligned with the goals of the company, goes a
long way in this regard. It’s also important to have an environment as free of cliques,
back-stabbing and idea stealing as possible. As a manager, it is important to be alert to
these types of behaviors that are hostile to collaboration and to have (and enforce!)
disciplinary procedures for any type of harassment or unethical behavior.
Like the Wright Brothers, many people hide their ideas to avoid having them stolen or
criticized. Much time and energy is wasted defending the intellectual property of various
employees. This can be avoided.
Many companies focus solely on individual achievement, to the detriment of other
qualities essential to innovation and teamwork. You can resolve this, somewhat, by

28. including references to people’s interactive behaviors on performance reviews. Some
companies even have co-workers participate in the performance review process by rating
their teammates.
Resources and Equipment
Most companies have programs for education and training of their employees. Beyond
that, many companies provide resources and equipment for employees to innovate
without impacting their “real jobs.”
At Conoco, for example, developers were allowed to use the mainframe computers
during lunch times or during a 6-hour window on Sunday to run their own projects and
experiments. Groups of developers would bring ideas that they would like to try out or
experiment with, some which may have dubious practical value to the company but all of
which were great learning opportunities. Many of the “lunchtime programs” were later
implemented into production and did provide great value to the company.
Many other companies have a portion of a server where employees can build their own
web pages, or try new things, without impacting business critical systems. These
companies are building a “sandbox” for their employees to play in, and putting up wellmarked, well-understood “fences around the sandbox” to ensure that innovative, creative
play stays in its time and place, and is clearly separated from “regular business.”
Although many irrelevant innovations rise from this use of resources, the constraints on
their use ensure that the impact on your bottom line is minimal. Our IT manager’s
concern in the above example with software developers coming up with “cool” tricks
would be mitigated by these limits.
Providing resources, and putting careful restraints on the conditions of their use, can be
an inexpensive way for companies to encourage innovation.
A Compensation System
This is the final, and perhaps most important ingredient in managing innovation as a
company. It is important to reward innovators for their contributions, and to reward
people who collaborate as well as individual performers.
So many compensation systems are dependent solely on the easiest metrics to measurepersonal performance metrics based on the company’s current structure (or whatever it
was last year when the budget was drawn up!)
The inherent problem is that when someone creates something new, it may challenge the
way the company measures and compensates employees.
Profit sharing programs are an outstanding means of rewarding individuals for improving
the company’s standing. The down side is that everyone generally gets an equal
proportion that doesn’t recognize their individual contributions that year. A person who
makes a revolutionary contribution will be rewarded the same as his co-worker who
performed adequately.

29. Bonuses based on performance evaluations that emphasize innovation and collaboration
are a more specific option. Just be sure that the criteria are laid out beforehand and are as
fair and objective as possible.
Even if you have no control over financial compensation, there are generally other things,
like time off with pay, and recognition programs that can be utilized to reward innovators
and collaborators.
CONCLUSION
To conclude we can say that change may be forced on an organization or an organization
may change in response to the environment or an internal need. Whatever the case
changes must be properly planned and members should be properly prepared to accept
these changes enthusiastically, because the real world is turbulent, requiring
organizations and their member to undergo dynamic change if they are to perform at
competitive levels.
I’ll conclude with an example of a situation using these principles successfully. In this
situation, John Williams had just accepted a position as a data center manager.
Entering the job, he found that morale was low, inspections had been failed, and there
was an atmosphere of distrust. John had some barriers because it was a civil service
situation and he did not control the salaries of the individuals working for him. After
evaluating the situation, he called a meeting and announced that everyone would be
cross-training everyone else, and all procedures would be documented.
This was met with significant resistance, as you can imagine. Each employee had his or
her own small innovations – “cheat sheets,” informal procedures, and other “industrial
voodoo” that they guarded jealously. They each felt that his or her own job security was
dependent on their exclusive knowledge of some essential part of the data center. John
explained that participation in the cross training was mandatory, and failure to
successfully teach one’s job to one’s teammates would result in termination.
He also indicated that once the cross-training was completed, employees would rotate
getting a week off with pay every six weeks, rotating alphabetically through the sixmember team. The caveat to that was that the employee “on leave” would have to be near
a phone in case his teammates needed assistance, and could be in the office within one
hour.
Everyone was much more enthusiastic, given this motivation. People became helpful to
one another, they supported and helped one another, systems were documented, trained
and explained. The staff working was very careful not to disturb the team member on

30. leave because they knew they would have their turn soon and wanted the same
consideration.
The data center passed the next inspection with improving ratings, and the following one
with nearly perfect ratings.
The team had truly accomplished something, and had accomplished it together. They
were successful, and success breeds success!
By creating common goals, an atmosphere of collaboration, and a compensation system
that recognizes and rewards innovation, your company can mitigate the risks and
maximize the rewards of innovations from within the ranks.