In the spectrum of organizational change, which is the most radical type of change: automation, rationalization of procedures, business reengineering, or paradigm shifts? (You are expected to read an article about this question)... at least 3000 words)
There are several phrases regarding organizational change and development that look and sound a lot alike, but have different meanings. As a result of the prominence of the topic, there seems to be increasingly different interpretations of some of these phrases, while others are used interchangeably. Without at least some sense of the differences between these phrases, communications about organizational change and development can be increasingly vague, confusing and frustrating.
"Organizational Change?"
Organizational change is in regard to organization-wide change, as opposed to smaller changes such as adding a new person, modifying a program, etc. Examples of organization-wide change might include a change in mission, restructuring operations (e.g., restructuring to self-managed teams, layoffs, etc.), new technologies, mergers, major collaborations, "rightsizing", new programs such as Total Quality Management, re-engineering, etc. Some experts refer to organizational transformation. Often this term designates a fundamental and radical reorientation in the way the organization operates.
Change should not be done for the sake of change -- it's a strategy to accomplish some overall goal. Example is the Organizational Performance Management. We're used to thinking of ongoing performance management for employees, for example, setting goals, monitoring the employee's achievement of those goals, sharing feedback with the employee, evaluating the employee's performance, rewarding performance or firing the employee. Performance management applies to organizations, too, and includes recurring activities to establish organizational goals, monitor progress toward the goals, and make adjustments to achieve those goals more effectively and efficiently. Those recurring activities are much of what leaders and managers inherently do in their organizations -- some do them far better than others. Usually organizational change is provoked by some major outside driving force, e.g., substantial cuts in funding, address major new markets/clients, need for dramatic increases in productivity/services, etc. Typically, organizations must undertake organization-wide change to evolve to a different level in their life cycle, e.g., going from a highly reactive, entrepreneurial organization to more stable and planned development. Transition to a new chief executive can provoke organization-wide change when his or her new and unique personality pervades the entire organization.
Why is Organization-Wide Change Difficult to Accomplish?
Typically there are strong resistances to change. People are afraid of the unknown. Many people think things are already just fine and don't understand the need for change. Many are inherently cynical about change, particularly from reading about the notion of "change" as if it's a mantra. Many doubt there are effective means to accomplish major organizational change. Often there are conflicting goals in the organization, e.g., to increase resources to accomplish the change yet concurrently cut costs to remain viable. Organization-wide change often goes against the very values held dear by members in the organization, that is, the change may go against how members believe things should be done. That's why much of organizational-change literature discusses needed changes in the culture of the organization, including changes in members' values and beliefs and in the way they enact these values and beliefs.
Drivers Of Organizational Change
Organizational change management is becoming increasingly important to the business community. The intensification of competition from manufacturers in emerging economies who can produce superior goods at cheaper prices, the introduction of new technology and changing consumer preferences and tastes can result in companies having to redefine their business goals and objectives. The following factors are some of the primary drivers of organizational change.
Inadequate Financial Performance: Companies that fail to achieve financial benchmarks are forced to evaluate their business objectives and processes. This is one of the most important drivers of organizational change. If a new competitor enters the market with cheaper labor or a superior technology, companies that formally enjoyed prosperity can suddenly find a cannibalization of their market share. A failure to maintain a competitive presence in the market place can stress company resources and force a rethink of the opportunity cost of capital and resource redeployment.
Change In strategic Objectives: If a company shifts its focus form a product centric to a customer centric orientation, new processes are required to facilitate this re-orientation. This can result in redundancy to existing staff or manufacturing processes. Company restructuring from this is a primary driver of organizational change as the old is replaced with the new.
End of the Product Development Life Cycle: A product can reach the end of its product life cycle and companies are forced to cut production and operating costs or exit the market. At this stage some companies sell out or merge with existing competitors. This results in structural changes to a companies business processes to either maintain profitability or refocus on new opportunities.
New technology: New technology can be a significant driver of organizational change. Consider the effect the internet is having on old style media and print companies. As internet access levels increase on a worldwide scale, companies are forced to adapt their existing operations to shifting consumer preferences. Companies that neglect rising trends face a diminishing market share to competitors who better understand and address the demands of their customers.
Mergers and Acquisitions: When companies merge or consolidate operations, significant costs cutting and a re-engineering takes place. Redundancy and restructure to align with management objectives drives organizational change. The integration of two companies creates significant challenges to streamline operations and integrate existing IT operations into a centralized structure. Consider the implications of merging two independent billing systems which use different platforms and infrastructure. The careful dedicated planning required to bring this to fruition is part of the change management process.
As business and markets evolve, so too do business processes. The above represents some of the pertinent drivers of organizational change.
Causes of Organizational Changes
Companies are required to modify productive processes or strategic goals and aims in response to an external influence, change in consumer behavior or a shift in the industry landscape. This necessitates a reorientation of capital, resources, employees and corporate systems. Below are some of the common causes of organizational change:
Exit Strategy at The End of the product Life Cycle: As the market for a companies product reaches maturity, market growth and profits begin to diminish. Despite the fact that cost cutting occurs and marketing budgets are reduced, when the opportunity cost of deploying capital and resources to another more favorable opportunity presents, companies either sell off existing operations or cease production altogether. This can be in response to a new superior product release, a change in consumer purchasing habits or the introduction of a new technology. Irrespective of the cause, capital and labor are redeployed to new more promising business activities. The exit strategy is a common cause of organizational change.
Change in Government: Employees that work for government departments can find existing initiatives get discontinued when a change in government takes place. The subsequent refocus of priorities that takes place as a result of the new governments mandate can create redundancies or a radical change in the way the department conducts its affairs.
Mergers and Acquisitions: When two competitors merge the existing business operations of both companies get centralized and streamlined. This can result in the merging of departments and processes, cost cutting and a redeployment of existing resources. Mergers and acquisitions are one of the most frequent causes of organizational change.
Strategic Refocus: When the company changes its business processes to adopt a new paradigm organizational change ensues. Consider the plight of a company that shifts its focus form a product centric to a customer centric platform. New manufacturing specifications, new marketing and a change in logistical operations create a change reaction for change throughout the organization.
Structural Change: When new administrative processes get introduced, organizational change results. Consider the ramifications of centralizing an archiving process using computer technology. Old redundant processes get replaced by new software and hardware and staff members are required to retrain to operate the new systems.
Process Oriented: When a company redefines its manufacturing operations by changing its manufacturing process to a JIT operation, infrastructure, warehousing and logistical operations are required to be redesigned and deployed. This structural shift in the way a product is created has a domino effect on organizational change.
Terminologies of Radical Type of change
1.Automation is the use of control systems (such as numerical controlprogrammable logic control, and other industrial control systems), in concert with other applications of information technology (such as computer-aided technologies [CAD, CAM, CAx]), to control industrial machinery and processes, reducing the need for human intervention. In the scope of industrialization, automation is a step beyond mechanization. Whereas mechanization provided human operators with machinery to assist them with the muscular requirements of work, automation greatly reduces the need for human sensory and mental requirements as well. Processes and systems can also be automated.
Automation plays an increasingly important role in the global economy and in daily experience. Engineers strive to combine automated devices with mathematical and organizational tools to create complex systems for a rapidly expanding range of applications and human activities.
Many roles for humans in industrial processes presently lie beyond the scope of automation. Human-level pattern recognition, language recognition, and language production ability are well beyond the capabilities of modern mechanical and computer systems. Tasks requiring subjective assessment or synthesis of complex sensory data, such as scents and sounds, as well as high-level tasks such as strategic planning, currently require human expertise. In many cases, the use of humans is more cost-effective than mechanical approaches even where automation of industrial tasks is possible.
Specialized hardened computers, referred to as programmable logic controllers (PLCs), are frequently used to synchronize the flow of inputs from (physical) sensors and events with the flow of outputs to actuators and events. This leads to precisely controlled actions that permit a tight control of almost any industrial process.
Human-machine interfaces (HMI) or computer human interfaces (CHI), formerly known as man-machine interfaces, are usually employed to communicate with PLCs and other computers, such as entering and monitoring temperatures or pressures for further automated control or emergency response. Service personnel who monitor and control these interfaces are often referred to as stationary engineers.
2.Paradigm shifts
Paradigm shift (or revolutionary science) is the term first used by Thomas Kuhn in his influential book The Structure of Scientific Revolutions (1962) to describe a change in basic assumptions within the ruling theory of science. It is in contrast to his idea of normal science.The term paradigm shift, as a change in a fundamental model of events, has since become widely applied to many other realms of human experience as well, even though Kuhn himself restricted the use of the term to the hard sciences. According to Kuhn, "A paradigm is what members of a scientific community, and they alone, share." (The Essential Tension, 1977). Unlike a normal scientist, Kuhn held, "a student in the humanities has constantly before him a number of competing and incommensurable solutions to these problems, solutions that he must ultimately examine for himself." (The Structure of Scientific Revolutions). Once a paradigm shift is complete, a scientist cannot, for example, posit the possibility that miasma causes disease or that ether carries light. In contrast, a critic in the Humanities can choose to adopt a 19th-century theory of poetics, for instance.Since the 1960s, the term has been found useful to thinkers in numerous non-scientific contexts. Compare as a structured form of Zeitgeist.
3. Business Process Re-engineering (BPR): The radical redesign of business processes, combining steps to cut waste and eliminating repetitive, paper-intensive tasks to improve cost, quality, and service and to maximize the benefits of information technology
• Involves radical rethinking
• Can change the way an organization conducts its business
• IT allowed Baxter to be a manager of its customer’s supplies
• Strikes fear, its expensive, its very risky and its extremely difficult to carry out and manage
• Develop the business vision and process objective
• Identify the processes to be redesigned (core and highest payback)
• Understand and measure the performance of existing processes
• Identify the opportunities for applying information technology
• Build a prototype of the new process
Refenrences:
http://en.wikipedia.org/wiki/Paradigm_shift
http://en.wikipedia.org/wiki/Automation
http://managementhelp.org/org_chng/org_chng.htm
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