Mullins L.J. Management and organisational behaviour, Seventh edition
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influence of non-managerial staff, and a threat to the power in their own positions.
Where a group of people have, over a period of time, established what they perceive
as their ‘territorial rights’, they are likely to resist change.
As we have seen, people tend to be resistant to change. It is important, therefore, for
management to understand the reasons for, and nature of, resistance and to adopt a
clearly defined strategy for the initiation of change.
97
The successful management of
change is an increasingly important managerial responsibility. New ideas and innova-
tions should not be perceived as threats by members of the organisation. The efforts
made by management to maintain the balance of the socio-technical system will influ-
ence people’s attitudes, the behaviour of individuals and groups, and thereby the level
of organisational performance and effectiveness.
The successful management of change is clearly essential for continued economic
performance and competitiveness. Stewart is among those writers who point out how
changes in technology and in domestic government policies have had a radical impact
on managers in many companies and in public service organisations.
One of the most difficult problems for managers is rapid change. How British managers react to
change will have an important influence on Britain’s economic future. This is true for managers
in the public service as well as for those in industry and commerce. The tempo of change has
speeded up; hence the demands made on managers to plan for, and adjust to, change are
greater. All change requires both abilities.
98
The importance of managing workplace change is also emphasised, for example, in a
recent ESRC publication.
Workplaces are dynamic and they always have been. Those who like to view the past as a time of
static business organisations are mistaken although of course the pace of change increases and
declines and is not always the same. Modernisation has become an awful word in the corrosive
language of public discourse. But any enterprise that has ever wanted to survive and prosper has
always needed to restructure and innovate. The fundamental question is where the balance lies
in the crucial relationship in what is an interactive process between continuity and change.
99
Christensen and Overdorf suggest a framework to help managers understand what types
of change the organisation is capable and incapable of handling. They identify three
factors that affect organisational responses to different types of change and what an
organisation can and cannot do:
■ resources – access to abundant, high quality resources increases an organisation’s
chances of coping with change;
■ processes – the patterns of interaction, co-ordination, communication and decision-
making employees use to transform resources into products and services. Processes
may be formal and explicitly defined and documented, or informal and routines or
ways of working that evolve over time;
■ values – the standards by which employees set priorities that enable them to judge
whether an order is attractive, whether a customer is more or less important,
whether an idea for a new product is attractive or marginal.
The factors that define an organisation’s capabilities and disabilities evolve over time –
they start in resources, then to move to visible, articulated processes and values, and
finally migrate to culture. Christensen and Overdorf maintain that when an organisa-
tion faces the same sort of problem that its processes and values were designed to
address, managing can be straightforward. However, when the problem facing the
CHAPTER 22 ORGANISATION DEVELOPMENT (CULTURE, CONFLICT AND CHANGE)
915
THE MANAGEMENT OF ORGANISATIONAL CHANGE
Organisational
responses to
disruptive
change
organisation is fundamentally different these same factors constitute disabilities, espe-
cially when the organisation’s capabilities have come to reside in processes and values.
There are three possible ways in which managers can develop new capabilities to cope
with change:
■ create new organisational structures within corporate boundaries in which new
processes can be developed;
■ spin out an independent organisation from the existing organisation and develop
new processes and values;
■ acquire a different organisation whose processes and values match closely the new
requirements.
100
Many books and articles refer to the steps or actions to be taken to secure successful
and sustainable change.
101
For example, Kotter and Cohn list the following eight steps
for successful large-scale change.
1 Create a sense of urgency among relevant people, whatever the nature or size of
the organisation.
2 Build a guiding team with the credibility, skills, connections, reputations and
formal authority to provide change leadership.
3 Create visions which are sensible, clear and uplifting, and sets of strategies.
4 Communicate the vision and strategy in order to induce understanding and
commitment.
5 Empower action and remove obstacles that stop people acting on the vision.
6 Produce short-term wins that help to provide credibility, resources and momentum
to the overall effort.
7 Don’t let up but maintain the momentum, consolidate early changes and create
wave after wave of change.
8 Make change stick by nurturing a new culture, and developing group norms of
behaviour and shared values.
102
The effective management of change must be based on a clear understanding of
human behaviour at work. Most people are not detached from their work but experi-
ence a range of emotional involvements through their membership of the
organisation, they feel threatened and disoriented by the challenge of change.
Emotions such as uncertainty, frustration or fear are common reactions. It is under-
standable therefore that people often adopt a defensive and negative attitude, and
demonstrate resistance to change.
Elliott explains change as a complex, psychological event. The power of change
needs to be respected and managed. Managing change places emphasis on employee
(and customer) needs as the highest priority. To be successful, organisations need a
dedicated workforce and this involves the effective management of change. But not
everyone reacts to change in the same way. Change impacts each person differently
and management must accept the individual nature of change. For example, senior
managers responsible for initiating a restructuring may be filled with great expecta-
tions. They do not see the sense of resistance and find it hard to accept the negative
impact of change. But the change may mean inconvenience, uncertainty and loss for
other people. Loss and grief are just as normal reactions to change as are excitement
and anticipation.
103
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PART 8 IMPROVING ORGANISATIONAL PERFORMANCE
Actions to
secure
effective
change
HUMAN AND SOCIAL FACTORS OF CHANGE
In a similar vein, Riches refers to the emotional stages of change, and to the feeling
of loss arising from unexpected and unwanted changes.
When organizations go through change, for example a restructure, a merger, downsizing, the
installation of new information technology, outsourcing, a shift to customer focus or a new loca-
tion – many employees experience a sense of loss. This is obvious if it means losing a job. Yet
often the reasons for the sense of loss are not clear but the effects may be just as profound – both
for the individual and on the organization’s bottom line.
104
According to Bali, almost every business, whether large or small, has recognised the
role and importance of information technology (IT) in today’s commercial environ-
ment. Change programmes which introduce new technical practices into an
organisation can be notoriously difficult to consummate. This may go some way in
explaining why such implementations can fail in a company and deeper probing can
reveal further explanations for the failures. Turning the spotlight on to the organisa-
tional unit, the term ‘culture’ is often used to describe the organisation, the
management and their internal attitudes. The management area of organisational cul-
ture is an increasingly popular topic but, to date, empirical research applying the
constructs to the small to medium-sized enterprise (SME) sector has been slight.
105
An account of organisation culture, change and IT in a small to medium-sized
enterprise (SME) is given in Management in Action 22.1 at the end of this chapter.
One of the most important factors in the successful implementation of organisational
change is the style of managerial behaviour. In certain situations, and with certain
members of staff, it may be necessary for management to make use of hierarchical
authority and to attempt to impose change through a coercive, autocratic style of
behaviour. Some members may actually prefer, and respond better, to a directed and
controlled style of management. (Recall, for example, the discussion on Theory X and
Theory Y styles of managerial behaviour in Chapter 7.)
In most cases, however, the introduction of change is more likely to be effective
with a participative style of managerial behaviour. If staff are kept fully informed of
proposals, are encouraged to adopt a positive attitude and have personal involvement
in the implementation of the change, there is a greater likelihood of their acceptance
of the change. However, Reis and Pena maintain that too often, management ignores
human resistance issues and the need to address them in the implementation plan.
The success of any change depends on the willingness of employees to accept it with enthusiasm
and implement it with care. Yet, business changes at times are undertaken without understanding
how the human element influences the success or failure of a project. Frequently, companies
develop impressive technical plans and simply assume the change – technical or organizational –
will occur. The difficult and often neglected part of such initiatives is leading and managing behav-
ioural change with those persons who interface with the new technology or the new initiatives.
106
McHugh et al. point out that many public sector organisations have embarked upon far-
reaching programmes of unsettling strategic change. They argue that such change
programmes initiated by senior management without involvement of organisational mem-
bers are unlikely to be successful. Organisations are more likely to experience the desired
metamorphosis where the change is led by relatively junior front line staff with senior
management practitioners acting as facilitators of organisational transformation.
107
A summary outline of ‘introducing change’ is presented in Figure 22.5.
An account of the management of change at Siemens Nixdorf (now Fujitsu
Siemens) is given in Management in Action 22.2.
CHAPTER 22 ORGANISATION DEVELOPMENT (CULTURE, CONFLICT AND CHANGE)
917
Culture,
change and
IT in an SME
Style of
managerial
behaviour
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PART 8 IMPROVING ORGANISATIONAL PERFORMANCE
INTRODUCING CHANGE
•
WHAT PROBLEMS ARE ASSOCIATED WITH CHANGE?
•
PLANNING AND IMPLEMENTING CHANGE
•
LEWIN’S CHANGE MODEL
LEWIN’S
UNFREEZE/CHANGE/REFREEZE
MODEL
•
DEFINITION
•
PROCESS
•
BENEFITS
BENEFITS
– The model can easily be understood.
– Those undergoing the change process can
– –recognise the stage they have reached.
– It allows the process of change to be
– –discussed as well as the outcomes.
– Understanding the process in one change
– –makes for easier progress in a future
– –change.
DEFINITION
This model defines three stages in
the process of change.
It assists organisational change by
– allowing the process to be understood
– providing milestones for evaluating
– – progress towards the change
– being able to be used for all types
– – of change
It does not prescribe
– the nature of the change
– the speed of the change
– the number and type of people
– – involved in the change
– the eventual outcome of
– – the change
PROCESS
UNFREEZING
–
Develop an awareness of
–
•
the nature of the change needed
–
•
the methods planned to achieve the change
–
•
the needs of those affected
–
•
the ways that progress will be planned and
–
• monitored
PLANNING AND IMPLEMENTING CHANGE
– Why do people resist change?
– Planning change
– How to help people to accept change
– Following-up after change
HELPING PEOPLE TO ACCEPT CHANGE
– Consider how they will be affected
– Plan change carefully
– Involve them in the change
– Consult and inform frequently
– Be firm but flexible
– Make controversial change as gradually
– –as possible
– Monitor the change
– Develop a ‘change’ philosophy
CHANGING
– Defining problems
– Identifying solutions
– Implementing solution
REFREEZING
– Stabilising the situation
– Building and rebuilding relationships
– Consolidating the systems
FACTORS INFLUENCING
CHANGE
Potential causes
– Economic/resource shortage
– Legislative/government
– Competition/market forces
– Technical/technological
– Educational/expectations
– Sociological/consumerism
SOME POSSIBLE
ACTIONS
– Training/retraining
– Communicating/involving
– Job enrichment
– Career planning
– Re-establishing loyalty
– Education/re-education
WHY DO PEOPLE RESIST?
– Insecurity (status, job, differentials)
– Fear of criticism
– Loss of colleagues/workmates
– Difficulty of learning new skills
– Loss of job interest
PLANNING CHANGE
– Develop a clear vision
– Identifying significant steps in the
– – change process
– Communicate the staged plan
– – to all concerned
– Avoid undue haste
– Inspire confidence by
–
•
forestalling problems
–
•
communicating regularly
FOLLOWING-UP
– Have the desired results been achieved?
– Has the process been successful?
– How do those affected feel about the new situation?
– What might have been done differently?
– How can those not responding well to the
– –change be helped?
Figure 22.5 Summary outline of introducing change
(Reproduced with permission of Training Learning Consultancy Ltd, Bristol.)
Minimising the problems of change
Activities managed on the basis of technical efficiency alone are unlikely to lead to
optimum improvement in organisational performance. A major source of resistance to
change arises from the need of organisations to adapt to new technological develop-
ments. The following discussion on how to minimise the problem of change centres
on the example of the impact of information technology. The general principles, how-
ever, apply equally to the management of change arising from other factors.
■ An important priority is to create an environment of trust and shared commit-
ment, and to involve staff in decisions and actions which affect them. There is a
considerable body of research and experience which demonstrates clearly the posi-
tive advantages to be gained from participation. It is important that members of
staff understand fully the reasons for change. Organisations should try to avoid
change for the sake of change as this can be both disruptive and lead to mistrust.
However, considerations of the need to change arising from advances in informa-
tion technology simply cannot be ignored.
■ There should be full and genuine participation of all staff concerned as early as
possible, preferably well before the actual introduction of new equipment or
systems. Information about proposed change, its implications and potential benefits
should be communicated clearly to all interested parties. Staff should be actively
encouraged to contribute their own ideas, suggestions and experiences, and to voice
openly their worries or concerns. Managers should discuss problems directly with
staff and handle any foreseen difficulties in working practices or relationships by
attempting to find solutions agreed with them. The use of working parties, liaison
committees, steering groups and joint consultation may assist discussion and par-
ticipation, and help to maintain the momentum of the change process.
■ Team management, a co-operative spirit among staff and unions and a genuine
feeling of shared involvement will help create a greater willingness to accept
change. A participative style of managerial behaviour which encourages supportive
relationships between managers and subordinates, and group methods of organisa-
tion, decision-making and supervision, are more likely to lead to a sustained
improvement in work performance. There is an assumption that most people will
direct and control themselves willingly if they share in the setting of their objectives.
■ As part of the pre-planning for new technology there should be a carefully
designed ‘personnel management action programme’. The action programme
should be directed to a review of: recruitment and selection; natural wastage of staff;
potential for training, retraining and the development of new skills; and other
strategies to reduce the possible level of redundancies or other harmful effects on
staff. Where appropriate, arrangements for a shorter working week, and redeploy-
ment of staff with full financial support, should be developed in full consultation
with those concerned. If job losses are totally unavoidable, there should be a fair
and equitable redundancy scheme and provision for early retirement with protected
pension rights. Every possible financial and other support should be given in assist-
ing staff to find suitable alternative employment.
■ The introduction of incentive payment schemes may help in motivating staff
by an equitable allocation of savings which result from new technology and
more efficient methods of work. Incentive schemes may be on an individual basis,
with bonuses payable to each member of staff according to effort and performance;
or on a group basis, where bonus is paid to staff in relation to the performance of
the group as a whole. An alternative system is ‘measured day work’. Staff receive a
regular, guaranteed rate of pay in return for an agreed quantity and quality of work
based on the capabilities of new equipment and systems. Management may also be
able to negotiate a productivity bargain with unions. By accepting changes in work
methods and practices, staff share in the economic benefits gained from the
improved efficiency of information technology and automated systems.
CHAPTER 22 ORGANISATION DEVELOPMENT (CULTURE, CONFLICT AND CHANGE)
919
■ Changes to the work organisation must maintain the balance of the socio-
technical system. Increased technology and automation may result in jobs becoming
more repetitive and boring, and providing only a limited challenge and satisfaction to
staff. It is important, therefore, to attempt to improve the quality of work, to remove
frustration and stress from jobs, and to make them more responsible and interesting.
Actual working arrangements rely heavily on the informal organisation and effective
teamwork. Groups and teams are a major feature of organisational life and can have a
significant influence on the successful implementation of change. New working prac-
tices should take account of how best to satisfy people’s needs and expectations at
work through the practical application of behavioural science.
■ Careful attention should be given to job design, methods of work organisation,
the development of cohesive groups, and relationships between the nature and
content of jobs and their task functions. The introduction of new technology has
also highlighted the need to give attention to the wider organisational context
including the design of technology itself, broader approaches to improved job
design, employee involvement and empowerment, the development of skills and
problem-solving capacity, and the effective management of change.
The successful implementation of new work methods and practices is dependent upon
the willing and effective co-operation of staff, managerial colleagues and unions.
People are the key factor in the successful management of change. If change is to work
it must change the perceptions, attitudes and behaviour of people. For example, as
Murdoch points out change management is potentially the most effective way to
improve an organisation.
Organisations have realised that all the structures in the world are of no use if the people imple-
menting them are not convinced of their necessity … Change management means much more than
changing the chart. It means changing the nature of an organisation. And this involves people … In
good times or bad, the key to success is good communication within the company.
108
However, Lucas reminds us that a high proportion of change initiatives fail, derailed by
the people factor.
Given that change has become such a fact of business life, it is worrying that so many change
management programmes fail to fulfil their potential. The consensus among the experts is that it
is often the people factor that derails the effort. Put simply, organisations know where they want
to go – but they are not taking their people with them.
109
Continued technological change is inevitable and likely to develop at an even faster
rate. Managers must be responsive to such change. Attention must be given not only
to products and processes but to people. The full, potential benefits of information
technology and automation will only be realised if the management of change takes
proper account of human and social factors, as well as technical and economic factors.
The successful management of change is a key factor of organisational performance
and effectiveness and should emanate from the top of the organisation. Top manage-
ment has a responsibility for the underlying philosophy and attitudes of the
organisation, for creating and sustaining a healthy climate; and establishing appropri-
ate and supportive organisational processes. The successful implementation of change
demands positive action from top management and a style of transformational leader-
ship in order to gain a commitment to change.
110
From a study of 25 of chief executives in the UK and abroad, Hooper and Potter inves-
tigated what were thought to be the crucial attributes for effective change leaders. They
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PART 8 IMPROVING ORGANISATIONAL PERFORMANCE
People the
key factor
RESPONSIBILITIES OF TOP MANAGEMENT
point out that effective change leadership is not easy but found the following key fac-
tors and behaviours that have been crucial to the success of top people:
■ effective communication of the reasons for change and developing an open com-
munications culture;
■ releasing the potential of everyone involved in the change, and championing inno-
vation and creativity;
■ setting a good personal example; and
■ self-pacing to avoid unnecessary stress.
111
An interesting proposition is put forward by Drucker who contends that ‘one cannot
manage change. One can only be ahead of it. We do not hear much anymore about
“overcoming resistance to change’’’. Everyone now accepts that change is unavoidable.
But in a period of upheavals, such as the one we are living in, change is the norm. To be sure, it
is painful and risky, and above all it requires a greatdeal of very hard work. But unless it is seen
as the task of the organization to lead change, the organization – whether business, university,
hospital and so on – will not survive. In a period of rapid structural change, the only ones who
survive are the Change Leaders. It is therefore a central 21st-century challenge for management
that its organization become a change leader. A change leader sees change as opportunity. A
change leader looks for change, knows how to find the right changes and knows how to make
them effective both outside the organization and inside it. This requires:
1Policies to make the future.
2Systematic methods to look for and to anticipate change.
3 The right way to introduce change, both within and outside the organization.
4Policies to balance change and continuity.
112
CHAPTER 22 ORGANISATION DEVELOPMENT (CULTURE, CONFLICT AND CHANGE)
921
CRITICAL REFLECTIONS
‘I’ve been thinking about OD. It seems a strange subject to study because surely an organisation
can’t develop. It is only people who are developing. So OD is really all about the actions, behav-
iour and performance of people.’
‘Yes, that’s right, but it is people who make up the organisation, and as people change and
develop so does the organisation. And the development of people is ultimately all about improv-
ing the performance of the organisation.’
What are your own views?
For the past decade or so, organizations both large and small, whether in the private, public or vol-
untary sectors, have been subjected to enormous environmental pressures and forces of change,
which have led to major transformations in organizational structures and the context in which
management has to operate and succeed. Such changes are increasing in frequency, pace, com-
plexity and turbulence, and there appears to be no sign of abatement.
Hamlin, B., Keep, J. and Ash, K. Organizational Change and Development: A Reflective Guide for Managers, Trainers and
Developers, Financial Times Prentice Hall (2001), p. 13.
How would you attempt to help members of your staff cope effectively with environ-
mental pressures and continuing forces of change?
‘The socialisation of new members into an organisation’s culture is no more or less than the
manipulation of the individual, and is therefore unethical and should be condemned.’
Debate.
■
Organisation development (OD) is concerned with the diagnosis of organisational
health and performance, and adaptability to change. OD is a generic term embracing a
wide range of intervention strategies into the social processes of an organisation. It
involves the application of organisational behaviour and the performance of people. A
central and critical feature of OD is the effective management of change. The broad
nature of OD means, however, that many interrelated topic areas could be included
under this heading. It is action-oriented and tailored to suit specific organisational needs.
■ Applications of organisational behaviour and the effective management of human
resources are dependent upon organisational culture and climate. Organisational cul-
ture helps to explain how things are performed in different organisations. Culture is,
however, a general concept, and difficult to explain precisely. There are a number of
ways to classify different types of organisation culture. It develops over time and in
response to a complex set of factors. The pervasive nature of culture has an important
effect on the behaviour and actions of individuals, the process of management and on
organisational performance.
■ Organisational climate is based on the perception of members towards the organisa-
tion, and can be seen as the state of mutual trust and understanding among members of
the organisation. Climate influences the attitudes which staff bring to bear on their
work performance and personal relationships. A healthy organisational climate might
be expected to exhibit a number of characteristic features. Among the factors which
contribute to a healthy climate are staff morale and the extent to which employees have
a sense of commitment to, and psychological bond with, the organisation.
■ It might be expected that a healthy organisational climate would be reflected by
complete harmony in working relationships, but conflict is a reality of management
and organisational behaviour. There are contrasting views of conflict and it can be seen
to have both positive and negative outcomes. There are many potential sources of
organisational conflict related to individual, group, organisational and environmental
factors. Although a certain amount of conflict may be seen as inevitable, the important
point is how conflict is handled and managed. Managers need to adopt appropriate
strategies for dealing with the harmful effects of conflict.
■ Organisations operate within an increasingly volatile environment and are in a
state of constant change. Change is a pervasive influence and an inescapable part of
social and organisational life. There are a wide range of forces acting upon organisa-
tions which make the need for change inevitable. Change can affect all aspects of the
operation and functioning of the organisation. Planned organisation change involves a
process of behaviour modification. Change is reciprocal and changing organisations
may affect the nature of managerial work.
■ Despite the potential positive outcomes, change is often resisted at both the individ-
ual and the organisational level. Resistance to change can take many forms and it is not
always easy to pinpoint the exact reasons. It is important therefore for management to
adopt a clearly defined strategy for the successful initiation of change, including atten-
tion to the style of managerial behaviour, and the human and social factors of change.
The effective management of change is a key factor of organisational performance and
competitiveness, and should emanate from the top of the organisation.
922
PART 8 IMPROVING ORGANISATIONAL PERFORMANCE
SYNOPSIS
CHAPTER 22 ORGANISATION DEVELOPMENT (CULTURE, CONFLICT AND CHANGE)
MANAGEMENT IN ACTION 22.1
Organisation culture, change and IT in an SME
Thermo-X employs about 30 people on two sites in the
design, manufacture and calibration of temperature-
measurement equipment. The Managing Director is also the
owner of the business and has substantively set up the oper-
ational procedures and established systems. The Managing
Director’s vision at that time included taking Thermo-X into
new markets, expanding the product range and offering part-
nerships with suppliers and customers to increase turnover
and profitability. Shorter-term objectives included the promo-
tion of quality precepts and the value and importance of
traceability as a concept while increasing accuracy capability
in respect of thermal and electrical measurements.
Tur nover is £1 million per annum with gross profits around
20 per cent. The inventory levels remain high at £200,000.
This is mainly due to the need to keep relatively large stocks
of raw material in order to respond quickly to customer
demands. The company has less than 10 per cent of the UK
market share with a small amount of turnover from export to
Turkey and Belgium. The increase is anticipated in equal frac-
tions from the sensor products and the calibration service.
Although the vast majority of Thermo-X’s products have a
low unit cost, the products are, more often than not, failure-
critical in industrial process plant applications such as
furnaces. Furnaces and other industrial plant often have enor-
mous downtime costs, thereby necessitating very short
delivery times for failure-critical operational appliances. In
order to respond quickly to customer demands, and because
of the large variety in product range (over 4000 separate
items on offer), Thermo-X keeps relatively high levels of stock
(currently 20 per cent of turnover). Offering a fast and flexible
service is therefore of paramount importance.
The initial vision that prompted and justified change acted
as a guide and reference point throughout the change
process. The vision of Thermo-X’s Managing Director identi-
fied the major issues of change. The need for change was
formalised from a managerial point of view and the issues at
stake had been identified as the Managing Director was
aware that competition in the market-place necessitated
organisational and cultural change. The whole change
process at Thermo-X was driven by the prospect of a new
computer-based Management Information System (MIS). The
new technology acted as a catalyst for change and the
catalysing process required constant efforts to overcome
resistance, resist stagnation, and foster support to reaffirm
the validity of the proposed changes.
The introduction of IT (by way of the MIS and contemporary
IT and IS techniques such as Internet, e-mail and Windows-
based packages) into Thermo-X has considerably altered the
Managing Director’s role within the organisation. The data and
information produced by the IT, such as financial data high-
lighting inefficient areas of the company, has enabled the
Managing Director to focus attentions on eradicating other
deficiencies within the Thermo-X organisation. These include
such areas as the duplication of data-processing tasks, ineffec-
tive communication routes and the poor co-ordination of
orders spanning more than one department.
It is useful to list the many different technical, organisa-
tional, theoretical, psychological and managerial issues that
were considered. These issues revolved around perceptions
that the technology was to be the catalyst for change and
would effectively ‘drive the change’:
■ the business circumstances of the organisation, the overall
strategic plan, the emergence of new task requirements;
■ the impact of the organisation’s structure and the existing
procedures, practices and systems;
■ the design of jobs in relation to new tasks;
■ the skills of managers and plans for training and staff
development;
■ attitudes, motivation and commitment of all employees;
■ nature of the process for developing and updating the
technology used by the organisation and the extent to
which future users are involved;
■ design methodology and project management, the com-
position and effectiveness of any project team;
■ the state of industrial relations in the company.
Any change in organisational culture and structure would
effectively be MIS-led, as the technology would act as the
catalyst for change. Many changes occurred to take the com-
pany from its old culture to its present cultural state. These
are best reflected by way of a table (overleaf) which can com-
pare and contrast different aspects of the culture.
The previous hierarchical organisational structure of
Thermo-X now encompassed workgroups, allowing fuller co-
ordination within all departments. Decentralisation of the new
MIS has enhanced task and job variety. Efforts in flattening the
organisation’s structure, allowing the formation of workgroups,
have increased self-management. These new autonomous
groups now utilise employees to their full potential while retain-
ing the flexibility to adapt to and adopt new practices and
procedures. Team-working is now an integral feature of the
company. ‘Cell teams’ deal with as much of a received order
(from receipt of order to its fulfilment) as possible. These teams
are normally free to talk to the customer and can schedule and
prioritise orders and purchase any materials necessary.
The Thermo-X study revealed several elements or pro-posi-
tions: the desire to implement a company-wide Management
Information System, employees being opposed to a wide-
ranging implementation, employees being unconvinced of
923
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PART 8 IMPROVING ORGANISATIONAL PERFORMANCE
the merits of a Management Information System, technopho-
bic employees who are unsure of the impact of the new
technology, the importance of recognising that the above prob-
lems exist, the importance of IT education to bring down
barriers and the usefulness of IT pilot schemes, communica-
tion, dissemination, training and mentoring throughout the
change process.
(I am grateful to Rajeev Bali, Coventry University for providing this information.)
MANAGEMENT IN ACTION 22.2
Siemens Nixdorf’s new dynamism
Mark C. Maletz
The challenge of change – managing it, enacting it and lever-
aging it – has become one of the most important topics on
today’s corporate agenda. Twice each year, top executives
from many of Germany’s most important companies meet,
under the sponsorship of the senior teams from BMW,
Deutsche Bank and Siemens Nixdorf, to discuss the chal-
lenges they face in building more competitive skills and
organisations. The specific challenges discussed at the work-
shops vary greatly, ranging from new organisational
structures to the role of leadership. Issues associated with
new behaviours and with the emerging role of behaviour as a
competitive advantage have surfaced at every meeting.
One clear conclusion is that flexibility, responsiveness, inno-
vation and openness are the characteristics that today’s
corporations require and that they should replace control, rigid-
ity, predictability and caution. This entails a transformation for
many companies from bureaucracy to entrepreneurship.
Through such transformation, companies can better lever-
age their employees, at all levels, to help to design the
change itself and continue to be leaders of innovation. The
FT
Old Thermo-X culture New Thermo-X culture
‘Tall’ organisation structure which was autocratic ‘Flat’ organisation structure which is more autonomous
Information used for managerial control Information used to aid team problem-solving
External control mechanisms (for example, MD) Internal control mechanisms with self-regulation of groups
Employee regarded as being ‘expendable’ Employee regarded as a ‘vital cog in the company wheel’
Maximum breakdown of tasks, involving relatively Optimum breakdown of tasks, involving a much broader
simplistic and narrow skills range of skills
Employee regarded as an extension to a machine Employee regarded as being complementary to a machine
Managers monitor, control and evaluate Managers facilitate, mentor and plan
Company comprises one-person ‘building blocks’ Company comprises self-managed groups forming
‘building blocks’
Management in Action 22.1 continued
Photo: Fujitsu Siemens Computers