Today’s business world is constantly evolving. To keep up with the rapidly shifting environment, companies introduce process changes frequently within their organization to improve performance, and outdo their competition. In this memo, the pros and cons of frequent organizational changes are first investigated. By going through the effectiveness of adopting specific activities and leadership style in communicating changes, we seek to understand employees’ reaction to frequent process changes, and how it affects their work performance and attitude towards the organization. This will allow us to understand if employees learn and get better at change, or does change does irreparable damages.
Pros and cons of frequent organizational changes
When frequent changes are introduced, employees will grow to be accustomed to changes and eventually view it as a company culture. Therefore, whenever there is a change to be implemented, employees will be less resistance to change and accept the change. Employees will learn that changes are meant to improve their work productivity and effectiveness. Using the example of job rotation (Friedrich and Kabst, 1998) between various departments, employees will get accustomed to learning new skills which aim to increase work productivity and effectiveness. When employees are multi-skilled, job satisfaction and productivity increases and they also better understand how their work affects other employees. Employees would also feel that with more skills and knowledge, they are valuable to the company and this gives them a sense of job security.
Once employees accept frequent changes, they are able to learn and use past experience of change to help them cope with stress each time new change is implemented. They can better understand change is necessary and how the change can help them perform better with confidence and increase job satisfaction.
One of the frequent changes organization adopts is due to globalization. Introduction of strategy, structure and processes enable employees to become better in managing effects of globalization. In such instances, employees become adaptable and better in managing the effect of globalization.
Established frequent changes will also encourage change leaders to constantly look for new ways to communicate and implement changes to employees. They can use employee participation, reward management, training and development and motivation which will help to assist employees learn and get better at change.
The above positive effects are expected when employees accept changes, learn from and get better with changes. But in reality, employees are by nature resistant to change, and feel primarily stressful when changes are implemented. If employees are unable to accept change and adapt, stress increases and directly impacts their work performance, mental and physical health, and attitude towards the organization (Poole and Van de Ven, 2004), leading to irreparable damages.
Employees mostly fear that if they are unable to adapt, they may lose their job. This increases stress levels and directly lead to poor work performance by the employees and lowers productivity level for the organization. Using the example of process change, such as automation through the use of machinery, organization aims to improve productivity, maintain or improve quality standard, and reduce costs.
However, older employees of the organization will be resistance to use the machines and they fear that they would not be able to learn how to operate them. They would feel compelled to learn and usually take more time to learn, leading to poor work performance and lower productivity level. In the event that the older employees lose their job, previous tacit knowledge and work experience within the retrenched employees may be lost and this represents irreparable damage to the company.
Stress can also lead to health problems such as hypertension and anxiety. When employees seek frequent medical attention, both short and long periods of absences away from work will further impact the organizations daily operation, resulting in poor work performance and attendance for the employees and decreasing productivity for the organizations. Organizations will not be able to recover the lost time and potential profits lost due to low productivity; these are irreparable damages to the company.
In the absence where organization fail to adopt specific steps as per suggested by (Kotter, 2007), employees become less trusting and show less commitment to the company. Employee dissatisfaction would accumulate with frequent process changes being enforced onto them, resulting in lower morale and commitment towards the organization. These employees are likely to leave the company when there are better job opportunities. Organizations must than accept when large number of employees leaves, productivity level will decreases resulting in loss of income and potential profits. Organizational will also take longer time to hire and train new employees. Time lost and cost spent to rehire are irreparable damages to the organization.
It can be seen that frequent process changes aims to improve a company. But the end effect is mixed. It depends on employees’ perspective to the change, and their ability to adapt. The main crux lies in how the management implements changes, and communicates to the needs of every employee.
Effective Activities and leadership style
For employees to learn from and get better at change and experience the benefits we discussed above, the change leader should adopt specific effective activities at the right time to effectively implement change (Kotter, 2007). There are five steps that leaders can consider (Waddell, Cummings & Worley): Motivating Change; creating a vision; developing political support; managing the transition and sustaining the momentum.
Firstly, change leader should convince employees that frequent change is necessary through motivation. They can do so by creating a sense of urgency, showing employees how frequent change is a preventive measure rather than a salvation solution when they experience deep levels of hurt. Employees are also less resistance to change when they are motivated by the benefits of change.
Secondly, change leaders should create a simple and concise vision to enable employees to visualize the desired outcomes through proper plans and processes.
Thirdly, change leader should aim to balance the power among the various departments as it is an instinct for various departments to protect their self-interest and compete with one another for resources and influences
Fourthly, change leader should facilitate a smooth transition from the organization’s current state to the desired state through activity planning, commitment planning and management structures. Change leader should have a specific activity plan that has clear instructions, action and timeline. Change leader must be committed to see the transition complete successfully.
Lastly, once the changes are in progress, change leaders continue to provide the necessary resources for change. He should also have a support system for his employees in place when they face difficulties during the change. A reward system can be implemented for employees when they have successfully performed the changes that led to the desired outcomes. The reward system will encourage the employees to continue the change. Besides adopting the above five steps, a change leader should display a democratic and participative leadership instead of an autocratic leadership (Lewin, 1967), this will reduce the irreparable damages discuss above and ensure that employees learn from and get better at change.
In conclusion, employees are by nature resistant to organizational process changes but will eventually grow to be accustomed to changes and view it as a company culture. However, it is recommended that change leaders adopt a democratic leadership together with specific effective activities to effectively communicate frequent process changes. This is likely to reduce the irreparable damages and ensure that employees learn from and get better at change.
Cherry, K. Lewin’s Leadership Styles. Retrieved on 19th September 2012, from
http://psychology.about.com/od/leadership/a/leadstyles.htm Dahl, M.S. (2010), Organizational Change and Employee Stress. Friedrich, A., and Kabst, R. (1998). Functional Flexibility: Merely Reacting or Acting Strategically? Gilmore,T., Shea,G., &Useem,M. (1997) Sides effects of corporate transformation. The Journal of Applied Behavioral Science. Grunberg, L., Moore, S., Greenberg, E.S, &Sikora, P. (2008).The Changing Workplace and Its Effects: A Longitudinal Examination of Employee Responses at a Large Company.The Journal of Applied Behavioral Science. Kotter, J.P, (2007) Leading Change: Why Transformation Efforts Fail. Harvard Business Review Manns,M.L. &Rising,L. (2010). Strategies for Leading through Times of Change: Fourteen Effective Patterns to Ease an Organization through Change. Graziadio Business Review. McDonald, T.N. (2004). Analysis of worker assignment Policies on Production Line Performance Utilizing a multi-skilled workforce. Pascale, R, Millemann, M., Gioja, L.(1997). Changing the Way We Change. Harvard Business Review. Poole,M.S., & Van de Ven. A.H. (2004) Handbook of organizational change and innovation. Oxford, UK: Oxford University Press. Turner, R. &Sternin, L. (2005).Your Company’s Secret Change Agents. Harvard business Review Waddell, D.M, Cummings, T.G. & Worley, C.G. (3rd Edition).Organisation Development &Change.:CENGAGRE Learning Australia Pty Limited.