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Change Management

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Change Management ­MGMT625
VU
LESSON # 19
ORGANISATION ECOLOGY
Leading proponents organization ecology school of thought are Glenn and Carroll, and Hannan and
Freeman. In this theory population of organization is taken as a unit of analysis rather than single
organization. The dominant theme of population ecology is that effects of organization's
environment is critical in organization's survival and (performance) believe that forces internal to
the organization are less important. Principally, population ecologist think that organization do not
change and adapt; and consider that each time a new organization is born after a significant level of
change. Pfeffer and Salancik published their work as "The external control of organizations". This
has led to the analogy of natural selection processes as determining some aspects of organization.
Miller and Mintzberg referred to "the survival of organizational forms as being encouraged by
Darwinian forces" (e.g. Weberian of organization-dominance-of functional structure). Three issues
are considered central in population ecology model of change management:
1. Role of structural inertia in constraining adaptation
2. The classification of organizational species
3. The salience of the environment in determining organizational survival
1. Structural Inertia
Population ecology models of organization-environment relationship are considered alternative to
the dominant adaptation perspective. Though there are a variety of ecological perspectives yet they
all focus on selection phenomenon. The attribute patterns in nature to the action processes. Astley
and Van de Ven highlighted this adaptation versus selection as central debate in organization theory
(OT). Selection of new or changed organization forms occurs as a result of environmental
constraints and inertia is referred as an explanation for the lack of adaptive change. Therefore
structural inertia limits the ability of organization to change. Hanna and Freeman identified a
number of processes that generate inertial pressures both from internal structural arrangements and
from environmental constraints.
A. Internal Structural Arrangements
One of the biggest inhibiting factors for organizational change is sunk cost. Sunk cost of the firm
which means broadly any amount of time, money and efforts (plant & equipment or cost of R&D
and trained personnel) develops a restraining force within an entity to freely look for alternative
options. Structural arrangements refer to the rules and resources which an organization deploys
manifesting its commitment levels. A communication structure in organization like barriers
misperception amongst various players at vertical and horizontal levels also facilitates inertial
process. Internal politics for vested interests amongst organizational members act as restraining
force. The existing institutional norms ­rules and regulations remain status quo oriented to inhibit
organizational change
B. External Factors
Not only internal factor inhibit change but at times external factors like government and industry
creates barriers in smooth and consistent change management process. For instance there may be a
very high cost associated with a firm's decision to enter or exit any particular industry or market.
Bounded rationality, a concept given by Herbert Simon means managers are rationalizing not
rational, meaning thereby that decisions on the part of managers are always bounded by constraints
like time, space, cost and information. Therefore the choice of decision makers to go for alternative
options is extremely limited. Another relevant concept is of social legitimacy which imposes
restriction in the decision outcome for change or status quo. Managers will go for such decisions
which are considered legitimate and acceptable by society or by the members of the organization
socially. Most of the time society is slow to recognize and accept change, and more often it is
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Change Management ­MGMT625
VU
conservative to accept change. So what happens practically is that organization try to initiate
change but then do not intend to go for complete transformation. Miller and Freisen identified this
kind of response to environmental changes as sluggish adaptation. Miller also used the term
adaptive rigidities caused by the avoidance of uncertainties, and the fragmentation of the political
coalition and its goals cushion organizations from the need for adaptation. All these issues of
structural inertia (and in a way with organization adaptation phenomenon as well) explain the
relative superiority of natural selection process over adaptation in the survival of organization.
Therefore, population ecologists believe that environmental selection replaces adaptation as the
vehicle of change. Hannan and Freeman formulated theory well supported by empirical evidence
that "stronger the inertial pressures lower the adaptive flexibility and the more likely that the logic
of environmental selection is appropriate". Hence the proposition is the survival of organizations is
determined by environmental variations
By implications, we see population ecologists maintain lesser role for management, wise
governance, organization structure and bench marked managerial practices. There is paradox in this
thinking. The paradox with population ecology is that methodologically, the study deals with small
organizations with simple organization structure which were free from issues of sunk cost &
politics (non-chain small restaurant in 18 cities of California State). External constraints were not
strong either. The paradox is that inertia is, somewhat, largely a phenomenon associated with the
complex department structures of large organization.
To Astley and van de Ven, "Natural selection model fits small, powerless organizations operating
in environment with dispersed resources better than large well connected organizations operating in
environment with concentrated resources". For Aldrich, the structural inertia depends on the size of
organizations. The larger an organization, the greater the structural inertia and the more control the
organization can exercise over the environment (in-real life large organizations seem quite powerful
to shape or influence environment). Another scholar empirically says "the few organizations that
survive infancy owe their above average longevity to wise governance"
Therefore ecologist claim that inertia restricts adaptation and consequently enables selection forces
to dominate over adaptive strategy of the organization somewhat holds less ground. Going by this
concern that small organizations lack inertia and should have better adaptability to environmental
changes. The question then is whether this so in real life? How these dynamics are going to be in
developing countries.
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Table of Contents:
  1. COURSE ORIENTATION:Course objectives, Reading material, Scope of the subject
  2. BENEFITS AND SIGNIFICANCE OF CHANGE MANAGEMENT:Traditional management domain
  3. KURT LEWIN MODEL: ASSUMPTIONS AND IMPLICATIONS:Change Movement, Refreeze
  4. IMPLICATIONS OF KURT LEWIN MODEL:Sequence of event also matters, A Critical Look
  5. SOME BASIC CONCEPTS AND DEFINITIONS:Strategic change, Logical incrementalism
  6. TRANSACTIONAL VS. TRANSFORMATIONAL LEADERSHIP:Micro-changes, Organisation Development
  7. THEORIES OF CHANGE IN ORGANISATIONS
  8. LIFE CYCLE THEORY:Unit of Change, Mode of change, Organisation death
  9. TELEOLOGICAL THEORIES OF CHANGE:Unit of change, Mode of Change, Limitations
  10. DIALECTICAL THEORIES OF CHANGE:Unit of Change, Strategic planning
  11. A DIALECTICAL APPROACH TO ORGANISATIONAL STRATEGY AND PLANNING:
  12. LIMITATION OF DIALECTICS; DA AND DI:Overview of application of dialectics
  13. THEORIES OF CHANGE IN ORGANISATIONS
  14. APPLICATION OF EVOLUTIONARY THEORY:Managerial focus
  15. FURTHER APPLICATION OF EVOLUTIONARY THEORIES:Criticism
  16. GREINER’S MODEL OF ORGANISATIONAL– EVOLUTION AND REVOLUTION
  17. GROWTH RATE OF THE INDUSTRY:CREATIVITY, DIRECTION, DELEGATION
  18. COORDINATION:COLLABORATION, The Crisis
  19. ORGANISATION ECOLOGY:Structural Inertia, Internal Structural Arrangements, External Factors
  20. CLASSIFICATION OF ORGANIZATIONAL SPECIES:Extent of Environmental Selection, Determinants of Vital Rates,
  21. FOOTNOTES TO ORGANISATIONAL CHANGE:Stable Processes of Change, Rule Following, Conflict
  22. SOME COMPLEXITIES OF CHANGE:Superstitious Learning, Solution Driven Problems
  23. ORGANIZATIONAL ADAPTATION:The Entrepreneurial problem, The Administrative Problem
  24. PROSPECTORS:Analyzer, Reactors, Adaptation and Strategic Management
  25. SKELETAL MODEL OF ADAPTATION:Determinants of Adaptive ability, The Process of Adaptation
  26. STRATEGIC CHANGE:Nature of Change, The Importance of Context, Force field Analysis
  27. Management Styles and Roles:Change Agent Roles, Levers for managing strategic Change
  28. SYMBOLIC PROCESSES:Political Processes, COMMUNICATING CHANGE, Change Tactics
  29. STRATEGIC CHANGE:Pettigrew & Whipp’s Typology, Context on X-axis (Why of change)
  30. STRATEGIC CHANGE:Attributes of SOC Model, Implications for Management
  31. STRATEGIC CHANGE:Flow of Information, Recruitment, SOC Process
  32. Determinants of a Successful Change Management:Environmental, Management Orientation, Management Orientation
  33. Higgins 08 S Model – An Adaptation from Waterman’s Seven S model:Strategy, Systems and Processes, Resources
  34. IMPLEMENTATION AND STRATEGIC CHANGE: CONSTRAINING FORCES IN THE IMPLEMENTATION OF STRATEGIC CHANGE (CASE STUDY OF XYZ COMPANY)
  35. IMPLEMENTATION AND STRATEGIC CHANGE: CONSTRAINING FORCES IN THE IMPLEMENTATION OF STRATEGIC CHANGE (CASE STUDY OF XYZ COMPANY)
  36. WHY IMPLEMENTING STRATEGIC CHANGE IS SO DIFFICULT?:Change Typology, Technical Change
  37. IMPLEMENTATION APPROACHES:Attributes of incremental change,
  38. IMPLEMENTATION: RADICAL OR TRANSFORMATIVE CHANGE
  39. IMPLEMENTATION: RADICAL OR TRANSFORMATIVE CHANGE:Definition of Leadership, Follower Work Facilitation
  40. IMPLEMENTATION: RADICAL OR TRANSFORMATIVE CHANGE:Recognize the challenge
  41. IMPLEMENTATION: RADICAL OR TRANSFORMATIVE CHANGE
  42. IMPLEMENTATION: PUNCTUATED EQUILIBRIUM MODEL:Features of Radical Change, Theory of P-E model
  43. CHANGE IMPLEMENTATION: OD MODELS:The Transactional Factors
  44. CULTURE, VALUES AND ORGANIZATIONAL CHANGE:Significance and Role of Values, Values Compete
  45. ORGANIZATIONAL VALUES, CULTURE AND ORGANIZATIONAL CHANGE:Issues in Change Management