Transformation & strategic change

1. STRATEGIC
CHANGES
ORGANIZATION TRANSFORMATION
&

2. ORGANIZATIONAL TRANSFORMATION
Radical changes in structure, culture,
and processes to stay competitive
OT involves:
Overhauling structures, processes,
and cultures.
Addressing market disruptions,
technological advancements, and
competitive pressures.
Making organizations f lexible and responsive
to changing external conditions.
S u c c e s s Example : Cummins Inc
restructured and focused on green
technology
Failure Example : GM and Chrysler ’ s
bankruptcy despite efforts

3. TYPES OF CHANGES

4. Incremental:
Participative Evolution-
Collaborative, slow-paced
adjustments for minor
environmental changes.
Forced Evolution-Slow
adjustments without cultural
support.
Transformational:
Charismatic Transformation-
Radical, fast- paced change
with cultural support, led by
visionary leaders.
Dictatorial Transformation-
Authoritative and immediate
restructuring during crises,
STRATEGIES FOR CHANGE

5. CHALLENGES
High Risks
and
Uncertainty
External
Leadershi
p
Uncertai
n
Outcome
s

6. ROLE OF ODPRACTITIONERS
IN TRANSFORMATION
OD
practitioners
must assess the
change situation
to select the most
effective strategy.
Directive
approaches
( necessary in
crises) should be
combined with
participative
methods to
ensure long-term
success.
OD practitioners
focus on improving
leadership,
communication, and
d e c i s i o n - making
during transformation.
STRATEGIC ANALYSIS BALANCING METHODS BEHAVIORAL SKILLS

7. CORPORATE
CULTURE
Corporate Culture refers to the shared values, beliefs, and
behaviors in an organization that shape how employees
work and interact. I t evolves over time and is influenced
by the
organization' s leadership and history

8. WHY IS CORPORATE CULTURE IMPORTANT?
Improves organizational
effectiveness creates a positive
work environment
I t can be a company ' s strength or
weakness
STRATEGY AND CULTURE FIT
When strategy and culture f it well, they
reinforce each other and help in achieving
success

9. CORE CHARACTERISTICS OF CULTURE
Individual Autonomy
Support
Open
Communication
Innovation
Sensitivity to Needs
Risk Behavior

10. SHARING THE
VISION

11. STRONG VS. WEAK CULTURES
Number of Members
Sharing Values- extent
to which
organizational values are
shared among
members
Member Commitment to
Values- how intensely the
members
( employees) commit to
those values

12. The Strategy-Culture
Matrix
Understanding the relationship between strategy and culture is
essential for effective strategic change.
Four basic alternatives:
a.Manage the Change (Manageable Risk)
b.Reinforce the Culture (Negligible Risk)
c.Manage Around the Culture (Manageable Risk)
d.Change Strategy to Fit Culture (Unacceptable Risk)

13. Manage the Change
(Manageable Risk)
Reinforce the
Culture (Negligible
Risk)
Manage Around
the Culture
(Manageable Risk)
Change Strategy
to Fit the
Culture
(Unacceptable
Risk)
Share the vision –
align changes with
goals and mission.
Reshuffle power –
promote key
people to lead
change.
Reinforce the new
value system –
align rewards with
new direction.
Forge a vision
aligned with shared
values.
Reinforce and
solidify existing
culture.
Organizations can
use levers like
reshuffling
leadership, budget
allocations, or
reorganizing teams
to facilitate change.
This method
minimizes
resistance while
achieving desired
results.
Question the
necessity of
change. Avoid
cultural resistance
when change is not
critical.

14. Strategic change requires alignment between
strategy, structure, and human resource systems
with the environment.
Organizations consist of three interrelated
systems:
1.Technical System: Mission, strategy, and structure
for operational effectiveness.
2.Political System: Allocation of power and resources
(e.g., rewards, budgets).
3.Cultural System: Shared values, beliefs, and
goals. Change Process:
-- Develop a strategic vision aligning all systems.
-- Separate and intervene in each system
individually.
-- Reconnect systems to achieve the desired
organizational state
STRATEGIC CHANGE MANAGEMENT

15. CHANGING THE CORPORATE
CULTURE
Why Change Culture?
1. Values don’t align with the
environment. 2. Competitive, fast-
changing industry.
3. Mediocre or declining performance.
4.Growing into a very large
firm.
5.Small but growing rapidly.
Challenges of Cultural Change:
Entrenched beliefs and resistance based on
past success.
Cultural clashes in mergers/takeovers
(e.g., Chrysler-Mercedes).
Solution:
Develop an innovative culture that
aligns employees' needs, the firm's
history, and market demands.
OD strategies can help overcome
resistance to foster adaptability.

16. Thank
You!