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Building Organisational Resilience
1.
LEADING AND MANAGING
PEOPLE IN CHAOS AND COMPLEXITY Building Organisational Resilience A model for building change readiness through appropriate organisational culture Atul Kuver th 25 February 2011 1 © Atul Kuver 2011
2.
EXECUTIVE SUMMARY The purpose
of this study was to develop a ’fit-for-purpose’ model (Figure I) to build change readiness through organisational culture. The model was established through a resource-based view of the organisational culture and practices that assist change readiness, sustainable people management practices, and the capacity to implement change to deal with business sustainability challenges. Figure I. Model to build change readiness through organisational culture. A Defence Business (ADB) is one of the world’s largest defence contractors. Its customers include armed forces of countries around the world, government agencies and defence and aerospace prime contractors and the business has strong presence in the UK, USA and Australia. This report concerns one of ADB’s smaller operations (referred to as ‘Div A’) located in South Australia. ADB needs to address several issues affecting Div A in delivering more sustainable business practices. Div A’s issues 2 © Atul Kuver 2011
3.
concern commercial and
social sustainability. These issues require changes at ADB and Div A will be affected. The change readiness model developed and described in this report is aimed at building Div A’s readiness for change through its culture. The model explores the gap between the preparation and action stages of the change process to provide a framework with which to reduce this gap to a level where continuous change is accepted. The report examines the concept of change readiness to establish links between change readiness and organisational culture. The model treats the organisation, its culture and the individual employees as an integrated and interconnected system. It uses the concept of organisational resilience, and focuses on building change readiness and organisational resilience through cultural resilience. 3 © Atul Kuver 2011
4.
Table of Contents EXECUTIVE
SUMMARY ............................................................................................... 2 1 INTRODUCTION ................................................................................................. 5 2 THE CONCEPT OF CHANGE READINESS .............................................................. 7 3 CHANGE CHALLENGES AT ADB ........................................................................... 8 3.1 Business Overview ...................................................................................... 8 3.2 Change Challenges to Deliver More Sustainable Business Practices ............. 8 3.3 The Issues.................................................................................................. 10 4 THE MODEL: BUILDING CHANGE READINESS THROUGH APPROPRIATE ORGANISATIONAL CULTURE .................................................................................... 11 4.1 Structure, Components and Elements of the Model. ................................. 12 4.1.1 ‘Means – Ends’ Structure.................................................................... 13 4.2 Individual .................................................................................................. 14 4.2.1 Perception.......................................................................................... 14 4.2.2 Personal Valence ................................................................................ 15 4.2.3 Motivation ......................................................................................... 15 4.2.4 Self-Efficacy ........................................................................................ 16 4.2.5 Uncertainty ........................................................................................ 16 4.3 Culture ...................................................................................................... 17 4.3.1 Innovation, Risk-Taking, Learning Opportunities and Flexibility .......... 17 4.3.2 Resilience ........................................................................................... 18 4.3.3 Momentum ........................................................................................ 19 4.3.4 Change Valence and Change Efficacy.................................................. 19 4.4 Organisation .............................................................................................. 20 4.4.1 Information ........................................................................................ 21 4.4.2 Responsible Leadership ...................................................................... 21 5 FITNESS OF THE MODEL FOR USE BY ADB CHANGE AGENTS ............................ 24 6 CONCLUSION ................................................................................................... 25 REFERENCES ............................................................................................................ 27 4 © Atul Kuver 2011
5.
1 INTRODUCTION Social, economic,
political, or competitive factors are usually the initiators of organisational change. Champoux (2011) suggests that modern organisations are challenged with concurrent demands for change and stability. Organisations do not appear to have the option of reacting to the forces of change that originate externally or from within. Linear models of cause and effect no longer seem to apply. Change management is also probably one of the most challenging issues for managers in modern organisations. In most cases, there are usually two distinct groups — those that want to proceed with change and those who feel they will be worse off after the change. This study has developed a model for building change readiness through appropriate organisational culture. The notion of change readiness can be considered to be the extent to which individuals in an organisation hold a positive outlook about the necessity for organisational change as well as the extent to which the change will benefit themselves and the organisation (Jones et al. 2005). The model is established through a resource-based view of the organisational culture and practices that assist change readiness, sustainable people management practices and the capacity to implement change to deal with business sustainability challenges. The resource-based view of an organisation sees the organisation as having a unique set of resources and capabilities that gives rise to the concept of competitive advantage. Organisational culture includes ‘values, norms, rites, rituals, ceremonies, heroes, and scoundrels in the organization’s history’ (Champoux 2011, p. 73). This description is an expansion of Schein’s (cited in Jones et al. 2005, p. 363) three dimensional view of organisational culture consisting of: assumptions — the taken-for-granted beliefs about human nature and the organisational environment; 5 © Atul Kuver 2011
6.
values — the shared beliefs and rules that regulate the attitudes and behaviours of employees; artefacts — the visible language, behaviours and material symbols within the organisation. These three dimensions provide a framework to examine an organisation’s change readiness impediments and assist in identifying areas where improvements may be made. In particular, values are seen to be central to understanding organisational culture (Ott, cited in Jones et al. 2005, p. 363) and values can therefore be considered to be a reliable depiction of organisational culture (Howard, cited in Jones et al. 2005, p. 363). Resilience has been discussed in terms of the individual (Bolton 2004; Coutu 2002). Bolton (2004, p. 60) describes resilience as ‘the capability of people to withstand hardship and, in facing adversity, to continue leading functional and healthy lives’. In addition to individual or employee resilience, Bolton (2004) points out that resilience can also exist at the organisational level and makes reference to ‘resilient organisations’ (p. 61). Organisational resilience as discussed by Bolton (2004) seems to be the result of resilient individuals. The model presented here uses the concept of organisational resilience and focuses on building change readiness through cultural resilience. In other words, a culture of resilience should exist if an organisation is to be change ready. The following framework will be used to discuss the significance of this model in building organisational resilience. Section 2 examines the concept of change readiness to establish links between change readiness and organisational culture. The change challenges at the company ‘A Defence Business (ADB)’ is discussed in Section 3, to learn about the types of change events the model may be required to address. The model —‘Building change 6 © Atul Kuver 2011
7.
readiness through appropriate
organisational culture’ is presented in Section 4. Section 5 illustrates the fitness of the model for ADB’s change agents followed by the conclusion to this report in Section 6. 2 THE CONCEPT OF CHANGE READINESS Armenakis and Harris (2007, p. 132) define readiness as the ‘cognitive precursor of the behaviors of resistance to or support for organizational change’. They prefer the term readiness instead of resistance because in their view the term readiness ‘fits better with a positive approach to framing change’ (Armenakis & Harris 2007, p. 132). They found that individuals who were in the ready for change (contemplation) stage and the actively changing (action) stage were more open to the introduction of a new leadership development program and there was an increased likelihood that the participants would positively evaluate its content and delivery (Harris & Cole 2007, cited in Armenakis & Harris 2007, p. 132). Armenakis and Harris (2007, p. 129) identified five key change beliefs that appear to provide reasons for the change recipient to support change initiatives. The beliefs are: 1. discrepancy — the belief that change is needed and this is reflected in the gap between the organisation’s present state and the state it wants to adopt; 2. appropriateness — the belief that a specific change designed to address the discrepancy is the correct action; 3. efficacy — the belief that the change recipient and organisation will successfully implement the change; 4. principal support — that leaders and managers within the organisation are committed to the success of the change; and 5. valence — the belief that the change is beneficial to the change recipient. Research suggests that readiness improves when change recipients can recognise the need for change, sense their ability to successfully implement change (self- 7 © Atul Kuver 2011
8.
efficacy) and they
are given the opportunity to participate in the change process (Cunningham et al. 2002, p. 377). Reshaping capabilities then become an important feature of an organisation’s ability to change and hence complements change readiness. According to Beckard and Harris (cited in Jones et al. 2005, p. 367), change readiness concerns the motivation and willingness of participants and reshaping capabilities include the knowledge, skills, and abilities of the entire organisation for successful change implementation. 3 CHANGE CHALLENGES AT ADB 3.1 Business Overview A Defence Business (ADB) is one of the world’s largest defence contractors. Its customers include armed forces of countries around the world, government agencies and defence and aerospace prime contractors. The business operates several countries including the UK, USA and Australia. The business has well established customer relationships by offering product through-life capability and long-term partnerships with its customers. Project management and engineering are ADB’s core competencies. 3.2 Change Challenges to Deliver More Sustainable Business Practices Over the past two decades, the defence industry has consolidated. This has resulted in fewer, larger defence organisations. The fifty largest defence businesses of the early 1980s had now become the country’s top five defence contractors (Guay 2007). In Australia, defence businesses focus on one customer — the Commonwealth of Australia. Major defence contractors with operations in Australia include Boeing, Raytheon, Lockheed-Martin, BAE Systems, Thales, and Australian Submarine Corporation. Generally, the Australian operations are significantly smaller than those 8 © Atul Kuver 2011
9.
in the US
or the UK. Smaller Australian defence subcontractors are often closely aligned with the larger organisations to maintain sustainable businesses. While ADB is a major defence prime contractor, this report concerns one of its smaller operations located in South Australia. This division of ADB (to be referred to as Div A) has approximately 200 employees at one of its South Australian sites. Building change readiness through appropriate culture will be focussed on this site. Div A is the result of an acquisition by ADB over a decade ago. Some cultural remnants from the previous business still exist but overall ADB has been very successful in integrating Div A after acquisition. Smaller divisions within large corporations can be particularly vulnerable to change. These divisions are at risk of being labelled ‘out-posts’. The core competencies of such a division need to be visible and highlighted. A small division sometimes needs to be run as an entirely different business to keep the division competitive. Div A, while allowed significant autonomy, is still bound by processes, procedures and policies of the global business. Many of these requirements were originally designed with larger sections of the business in mind. The consolidation of business divisions has had a significant impact on Div A. In recent years, the division has undergone changes due to further acquisitions. The small size of Div A means that it has had to cope with integration into other divisions. While Div A has seemed to cope well through these changes, there are signs that the on-going changes have had some negative effects on the division. Several managers have been transferred or their positions made redundant. Uncertainty due to the constant changes seems to be on the rise. The diversion of the Commonwealth’s defence budgets to the on-going operations in Iraq and Afghanistan and the perceived lack of work have made many employees nervous. The processes and policies that worked well for larger projects now seem rigid when applied to smaller ones. This adds another level of cost to bids. Competitors who do not have the 9 © Atul Kuver 2011
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additional cost burden
—mostly smaller more agile organisations — are able to out- bid ADB. ADB has responded. Project management procedures have been revised to allow ‘tailoring’ of project processes. However, a major problem is that these changes are not universal. While project procedures may have changed, other systems remain rigid — for example Configuration Management (CM) and Quality Assurance (QA). Both CM and QA are essential in maintaining product integrity and traceability so the reluctance in making any changes to these seems justifiable. 3.3 The Issues ADB needs to address several issues towards delivering more sustainable business practices. Sustainability in this context is defined as the achievement of long term and integrated commercial, environmental and social outcomes. Div A’s issues are primarily commercial and social. For, commercial sustainability: o change procedures to allow Div A to become more competitive; o develop project agility; o maintain and recruit talent; social sustainability: o improve employee morale; o maintain talent; o address uncertainty; These issues require changes at ADB. Div A in particular will be affected. The change readiness model developed and described in this report is aimed at building Div A’s readiness for change through its culture. The culture at Div A seems resilient and able to cope well with change. This model provides a framework to improve this capability and as a result improve the Div A’s readiness for change. 10 © Atul Kuver 2011
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4 THE MODEL:
BUILDING CHANGE READINESS THROUGH APPROPRIATE ORGANISATIONAL CULTURE Coolican and Jackson (cited in Igo & Skitmore 2005, p. 123) believe that organisational culture today provides a framework that can be used to ‘implement and operationalize business strategies’. At the same time, organisational culture is acknowledged as being difficult to change (Bresnen & Marshall, cited in Igo & Skitmore 2005, p. 123). The change readiness model proposed by Armenakis and Harris (2007) intended to offer change agents with the perspective of actions required to plan a programme to shape the five key beliefs which would then encourage change recipients to positively accept the change. This intention distinguishes their model from the model presented here. The change readiness model described here explores the gap between the preparation and action stages of the change process to provide a framework with which to reduce this gap to a level where continuous change is possible. This model should not be too dependent on external trigger and it should include continuously improving change readiness within the organisation’s culture. This is done by emphasising that effective organisational change can be driven through appropriate organisational culture and that the fundamental source of culture is the individuals who make up the organisation. In this model, low change readiness means the organisational culture permits or responds to change with difficulty. High change readiness means the culture copes well with change with minimum disruption to everyday operations. The aim of the model shown in Figure 1 is to illustrate the development of change readiness through its culture. The structure, components and elements of the model will now be discussed. 11 © Atul Kuver 2011
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Figure 1. Illustration
of the model to build change readiness through appropriate organisational culture. 4.1 Structure, Components and Elements of the Model. The model treats the organisation, its culture and the individual employees as an integrated and interconnected system. It is difficult to view these three components as independent and unconnected. In this model, the Organisation is shown as the structure within which Culture and Individuals are embedded. While it may be possible to argue that the three components can be separated while keeping firm links between them, the separated model may not clearly represent the inter- dependent nature of the three parts. The assertion in this model is that organisational change is fundamentally supported from an individual level. Culture then provides the momentum and resilience needed for heightened change readiness. 12 © Atul Kuver 2011
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The following terms
will be used to describe the model: elements —the basic building blocks and desired outcomes. Elements are embedded within the models components; components — the model has three components: Organisation, Culture and Individual; and structure — represents the overall model framework and refers to the arrangement of the components, elements and their associated inter- dependencies. 4.1.1 ‘Means – Ends’ Structure The illustrated model shown in Figure 1 is based on a ‘means – ends’ structure. The ‘means’ are the concepts and frameworks that should be considered as ways of building change readiness. Means are shown on the left half of the illustration. The ‘ends’ are the expected outcomes. Ends are shown on the right half of the illustration. All means and ends are elements within the model. The individual or employee is located in the centre of the illustration. This is in line with the philosophy used to develop this model – that the individual is at the crux of the organisation. 13 © Atul Kuver 2011
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4.2 Individual In this
model, five key elements for change readiness development in individuals are considered. The key elements are: Perception Motivation Personal Valence Uncertainty Self-efficacy Although Figure 1 shows these as separate elements within the structure of the Individual, in reality these elements may be interconnected and stimulating one element may affect others. In order to make sense of the impact of the elements, it is simpler to view each in isolation. This method provides a framework that can then be used to create associations and linkages based on the organisation’s unique circumstances. 4.2.1 Perception According to Eby (2000, p. 420), the perceptions of employees about whether the organisation is ready for change is an important aspect in recognising sources of resistance to change. Perception then becomes an important element in two ways — first, as a driver of change readiness and secondly as a predictor of change readiness. While perception may be improved through information and leadership to improve change readiness, using it as a predictor of change readiness is more difficult. Eby (2000, p. 422) proposes that perceptions of change readiness are dependent on an ‘individual’s unique interpretation of the organisation’s context’. This makes perception a subjective concept as there is no standard against which it can be measured. 14 © Atul Kuver 2011
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In this model,
the primary purpose of the perception element is its use as a driver to increase the individual’s change readiness. 4.2.2 Personal Valence Personal valence is the belief that the change is beneficial to the employee. When the individual goes through the process of establishing personal valence, he or she encounters decisional balance. Decisional balance refers to the expected risks of change versus the likely benefits of change (Cunningham et al. 2002). The individual’s perceptions of the benefits of change compared to the risks of failing to change start the process of readiness for change (Cunningham et al. 2002). Armenakis and Harris (2007) emphasised the impact of change recipient involvement and participation on enhancing personal valence. Participation allows individual to seek solutions to difficulties they face and improves efficacy by allowing them to select those changes they feel they can accomplish (Armenakis & Harris 2007, p. 130). While participation seems simple in concept, it may in fact prove to be difficult in practice. Leaders must also take into account the inter-dependent and complex nature of an individual employee. Individual-to-individual, individual-to-culture, and individual-to-organisation relationships and dependencies are not always clear in today’s complex business environment. 4.2.3 Motivation Gottschalg and Zollo (2007, p. 420) suggest that individuals’ motivation to behave in certain ways are determined by the extent to which the behaviour assists them in meeting their goals and the relevance of each goal to the individual. They use a three-category taxonomy to capture the primary differences between the means through which organisations can encourage motivation. The three categories are: extrinsic motivation —is driven by the objective of achieving extrinsic work related rewards such as money, power and recognition; 15 © Atul Kuver 2011
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hedonic intrinsic motivation — is driven through engagement in ‘enjoyable, self-determined and performance competence-enhancing behaviour’; and normative intrinsic motivation — is driven through engagement in behaviour compliant with organisation norms and values. (Gottschalg & Zollo 2007, p. 420) The model illustrates that while extrinsic and hedonic intrinsic motivation may be encouraged from an organisational level, normative intrinsic motivation is more closely related to organisational culture. 4.2.4 Self-Efficacy An individual’s perceived ability to successfully manage the change —self-efficacy — has the effect of mediating individual readiness (Prochaska et al. 1997, cited in Cunningham et al. 2002, p. 378) and organisational change (Armenakis et al. 1993, cited in Cunningham et al. 2002, p. 378). Confidence in one’s ability to cope with change is more likely to contribute positively to organisational change. Change may be resisted if individuals perceive that the process exceeds their ability to cope (Armenakis et al. 1993, cited in Cunningham et al. 2002, p. 379). In Cunningham et al.’s (2002) study, workers with an active approach to work issues were more confident in their coping ability regarding job change and demonstrated a higher readiness for organisational change. 4.2.5 Uncertainty Milliken (cited in Bordia et al. 2004, p. 508) defines uncertainty as ‘an individual’s inability to predict something accurately’. Uncertainty evolves due to lack of or ambiguous and contradictory information (Berger & Calabrese, Putnam & Sorenson cited in Bordia et al. 2004, p. 508). Bordia et al. (2005, p. 508) characterises uncertainty as an ‘aversive state’ that encourages responses which try and manage or reduce it. During organisational change, uncertainty is also one of the most 16 © Atul Kuver 2011
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commonly reported psychological
states (Bordia et al 2005, p. 509). Perceived resistance to change may just be an individual’s efforts to try and minimise uncertainty. 4.3 Culture Champoux (2011, p. 74) outlines seven key elements that describe organisational culture. These elements are: levels — culture has different degrees of visibility with core values being the least visible; pervasiveness — culture is widely dispersed; implicitness — veteran employees will often take core cultural values for granted; imprinting — culture is deeply rooted in the organisations history; political — culture is connected to systems of power; plurality — subcultures also exist; interdependency — culture is interconnected with other parts of the organisation; One of the characteristics of this model is that Culture is represented as a ‘buffer’ between the Organisation and the Individual. The resilience element is embedded within this buffer region. While it could be argued that an organisation exerts direct and uninterrupted influence over the individual, the ‘culture as a buffer’ stance seems reasonable as a general representation of modern organisations. 4.3.1 Innovation, Risk-Taking, Learning Opportunities and Flexibility Weiner (2009, p. 4) recognised the broader contextual conditions that affect change readiness. Four elements — innovation, risk-taking, learning opportunities and flexibility make up the means through which organisational culture can heighten its change readiness. These elements have been chosen as the primary means of building change readiness because different levels of each element normally exist 17 © Atul Kuver 2011
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within many organisations.
It is usually difficult to find a hard boundary separating each of these elements and in many cases dependencies will exist between elements. Jones et al. (2005, p. 365) identified that: 1. Employee perceptions that their organisation is dominant in human relations values and open systems values are more likely to possess positive views about organisational change — Flexibility; 2. Innovation and dynamic nature of open systems culture suggests that employees who perceive their organisational culture to be an open system are likely to hold positive views on change — Innovation/Flexibility; 3. Training and development of human resources may relate to an individual’s confidence and improve their ability to take on new challenges — Learning Opportunities; Studies that investigate the direct relationship between risk-taking and change readiness seemed to be lacking. Nonetheless, risk-taking seems to be an important element when considered together with innovation, flexibility and learning. Pursuing new ideas is usually closely associate with risk (in many cases significant risk). At the same time it is important to differentiate risk-taking from recklessness. The model proposes that managed risk-taking could result in an innovative and dynamic culture. 4.3.2 Resilience Coutu (2002, p. 48) observed that resilience theories overlap in three ways. Individuals who are resilient possess a firm acceptance of reality, a profound belief that life is meaningful and are able to improvise. Coutu suggests that people may recover from hardship with just one or two of these characteristics, but true resilience is only possible when all three characteristics exist and that these qualities hold true for organisations (Coutu 2002, p. 48). 18 © Atul Kuver 2011
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This model embeds
the resilience element within organisational culture. This has been done for three reasons: 1. Individual resilience in a large group is not always obvious. 2. Resilience is a subjective concept. It is not possible to create a measure of resilience and then compare individuals because there is no set standard against which resilience can be measured. 3. Culture can be treated as a single entity. While sub-cultures still exist, it is easier to gauge the aggregate resilience then to attempt qualification of individual resistance. 4.3.3 Momentum Jansen (2000, p. 54) presents three conceptualisations of momentum. The three views are: 1. strategic persistence —the ability to maintain a prior course of action; 2. the ability of a leader to create or control momentum; and 3. momentum as a dynamic force, the presence or absence of which determines the outcome of a change effort. In this model, concepts (1) and (3) are of greater significance. Persistence and momentum are good indicators of resilience. 4.3.4 Change Valence and Change Efficacy Cultural change valence and change efficacy are extensions of personal valence and self-efficacy discussed for the individual. The concepts are the same as that for the individual, except that valence and efficacy now apply at the organisation culture level. Cultural change valence is the cultural or aggregate belief that the change is beneficial. Change efficacy at the cultural level means that the organisation’s culture is at a point where it considers that it has the ability to successfully manage the change. 19 © Atul Kuver 2011
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It could be
argued that valence and efficacy are concepts that can only apply to individuals rather than aggregates. This argument is sound. However, this model sees organisational culture as a single entity (although there may be sub-cultures). Therefore, while the two concepts may seem abstract when compared with the concepts of reliance and momentum, they can still assist in understanding the complex nature of organisational change readiness. To increase or heighten change readiness, the organisation’s culture should aim to be more resilient, and increase momentum, change valence and change efficacy. The model suggests that these results may be achieved by developing or sustaining the culture in the areas of innovation, risk-taking and learning opportunities. In addition, the organisation must also demonstrate flexibility. These can be considered to be the input parameters needed to develop the appropriate culture. 4.4 Organisation The resource-based view sees the organisation as having a unique set of resources and capabilities that gives rise to the concept of competitive advantage. According to Teese and Pisano (cited in Jones et al. 2005), leading organisations in global markets will need to show timely responsiveness to efficiently manage and re-deploy these capabilities. Turner and Crawford (cited in Jones et al. 2005) further distinguish between operational capabilities and reshaping capabilities. Operational capabilities are those required to sustain everyday performance and these capabilities do not typically help in managing change effectively. On the other hand, reshaping capability consists of three key elements. These are (Jones et al. 2005, p. 367): engagement — involves employees participation to encourage motivation and dedication to the goals and plans of the organisation; development — improving resources and business systems to achieve the organisation’s goals; and performance management — proactive management of factors that drive organisational performance to ensure that it achieves the intended change. 20 © Atul Kuver 2011
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4.4.1 Information According to
Jimmieson et al. (2004), minimising feelings of uncertainty and associated threats is a significant challenge faced by managers during organisational change. During periods of change, individuals within the organisation need information to help them develop a sense of situational awareness and understanding (Sutton & Kahn, cited in Jimmieson et al. 2004, p.12). Jimmieson et al. (2004) asserts that timely and accurate information about the changes and change process may reduce uncertainty and that information may be made available through either formal or informal channels (p.12). The model considers uncertainty as a characteristic of the individual and places the uncertainty element at its core. The information made available therefore must permeate the organisational culture and reach the individual with minimum filtration. It then becomes important that the culture is such that it maximises the free flow of information to the individual. Uncertainty has already been discussed in Section 4.2.5. 4.4.2 Responsible Leadership Higgs and Rowland (2010) assert that the role of leaders in the change process has a significant impact on the success of change. In this model, leadership is viewed as a distributed function — a process that exists at many levels of the organisation and not a function of position alone (Higgs & Rowland 2005). Higgs and Rowland (2005) classified leadership behaviour and mindsets during organisational change into three broad categories, namely, shaping, framing change, and creating capacity. Shaping This is a leader-centric approach to change implementation. Framing Change Here the leader creates a framework that lets others contribute to the change process and displays a high level of trust in those who contribute to the change. 21 © Atul Kuver 2011
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Creating Capacity The leader
focuses on building individual and organisational capability and encourages growth and learning. The leadership characteristics for each leadership category and the impact of the leader’s behaviour are shown in Table 1. The behaviour of leaders can also influence the perception of organisational culture (Block, cited in Igo & Skitmore 2005, p. 123). The different practices develop from the basic assumptions leaders make when implementing changes needed for the organisation’s long-term survival (Igo & Skitmore 2005, p. 123). Once adopted, these assumptions are embedded into the organisation’s culture (Gordon, cited in Igo & Skitmore 2005, p.123). Leadership Key Leadership Characteristics Impact Category negative impact is eager to be the ‘mover and shaker’; on change sets the pace which others follow; and success; expects others to follow the leader’s Shaping ‘heroic’ models actions. mitigate against (Higgs and Rowland 2010) sustainable performance. creates a framework that lets other contribute to the change process; displays a high level of trust in those who contribute to the change; positively related Framing works with others to build vision and to change success; Change direction; promotes the reasons for change and explains why it is not desirable to return to older practices; focuses on building individual and organisational capability; positively related Creating encourages growth and learning; to change success; Capacity develops the necessary change implementation skills in people; provides feedback; and 22 © Atul Kuver 2011
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provides training; Table 1. Leadership characteristics for each leadership category and the impact of the leader’s behaviour. 23 © Atul Kuver 2011
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5 FITNESS OF
THE MODEL FOR USE BY ADB CHANGE AGENTS Possible Change Issue Attention Event Allow Div A to Changes to Information become more procedures results in Organisation Responsible competitive new or unfamiliar leadership practices. Innovation Culture Risk-taking Flexibility Perception Individual Self-efficacy Uncertainty Develop project Retraining of project Organisation Information agility managers and Learning engineers. opportunities Culture Innovation Flexibility Motivation Individual Personal valance Self-efficacy Maintain and Re-deploy Recognition of recruit talent employees to other excellence Organisation sites. Responsible leadership Learning opportunities Culture Risk-taking Flexibility Motivation Personal valance Individual Uncertainty Self-efficacy Improve Additional training Information employee and implementation Responsible morale and of processes that Organisation leadership address allow greater Recognition of uncertainty transparency excellence Learning Culture opportunities Innovation Perception Individual Motivation 24 © Atul Kuver 2011
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Personal valance
Uncertainty Self Efficacy Table 2. Application of the model to the issues faced by ADB in relation to Div A. Table 2 shows several issues that need to be addressed at Div A. Dealing with these issues would require change. Possible change events corresponding to each issue are also given in Table 2. Column 3 shows the elements that would require the change agent’s attention. The use of the word ‘attention’ is a deliberate attempt to avoid the word ‘application’. Application implies that the model may be normative, which it is not. Its purpose is to allow the change agent to use the organisational culture to build or improve change readiness. The arrow traversing the Culture component in Figure 1 should be taken as building change readiness through organisational culture. 6 CONCLUSION The purpose of this study was to develop a ’fit-for-purpose’ model to build change readiness through organisational culture. The model has been developed through a resource-based view of the organisational culture and practices that facilitate change readiness, sustainable people management practices and the capacity to implement change to deal with business sustainability challenges. The report has examined the concept of change readiness to establish links between change readiness and organisational culture. The change challenges at ADB were presented to learn about the types of change events the model may be required to address. This model provides a framework to improve Div A’s change readiness through its culture and to build organisational resilience. It is important to note that the model is not intended to be applied as a process for changing organisational culture. The model does not actively seek to change the fundamentals of the established culture; change readiness is developed through positive utilisation of organisational culture. 25 © Atul Kuver 2011
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Harris, S 2009, 'Reflections: our Journey in Organizational Change Research and Practice', Journal of Change Management, 9, 2, pp. 127-142. Bolton, D 2004, ‘Change, coping and context in the resilient organisation’, Mt Eliza Business Review, vol. 7, no. 1, pp. 57-66. Bordia, P, Hobman, E, Jones, E, Gallois, C & Callan, VJ 2004a, ‘Uncertainty During Organizational Change: Types, Consequences, and Management Strategies’, Journal of Business and Psychology, vol. 18, no. 4, pp.507-532 Champoux, JE 2011, Organizational Behaviour: Integrating Individuals, Groups and Organizations, 4th Edn, Routledge, London and New York Coutu, DL 2002, ‘How Resilience Works’, Harvard Business Review, May, pp.46-55 Cunningham, C, Woodward, C, Shannon, H, MacIntosh, J, Lendrum, B, Rosenbloom, D, & Brown, J 2002, 'Readiness for organizational change: A longitudinal study of workplace, psychological and behavioural correlates', Journal of Occupational & Organizational Psychology, 75, 4, p. 377. Eby, LT, Adams, DM, Russell, JT & Gaby, SH 2000, ‘Perceptions of Organisational Readiness for Change: Factors related to Employees’ Reactions to the Implementation of Team Base Selling’, Human Relations, vol. 53, no. 3, pp.419-442. Gottschalg, O & Zollo, M 2007, ‘Interest Alignment and Competitive Advantage’, Academy of Management Review, vol. 32, no. 2, pp. 418-437. Guay, T. R. 2007, ‘Globalization and its Implications for the Defense Industrial Base’, www.strategicstudiesinstitute.army.mil/pdffiles/PUB756.pdf [accessed 20 February 2011] 27 © Atul Kuver 2011
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Higgs, M, &
Rowland, D 2005, 'All Changes Great and Small: Exploring Approaches to Change and its Leadership', Journal of Change Management, 5, 2, pp. 121-151. Higgs, M, & Rowland, D 2010, 'Emperors with clothes on: The role of self-awareness in developing effective change leadership', Journal of Change Management, 10, 4, pp. 369-385. Igo, T, & Skitmore, M 2006, 'Diagnosing the organizational culture of an Australian engineering consultancy using the competing values framework', Construction Innovation (Sage Publications, Ltd. ), 6, 2, pp. 121-139. Jansen, KJ 2000, ‘The Emerging Dynamics of Change: Resistance, Readiness, and Momentum’, Human Resource Planning, vol. 23, no. 2, pp53-55. Jimmieson, NL, Terry, DJ & Callan, VJ 2004, ‘A Longitudinal Study of Employee Adaptation to Organizational Change: The Role of Change-Related Information and Change-Related Self-Efficacy’, Journal of Occupational Health Psychology, vol. 9, no.1, pp.11-27 Jones, Renae A., Nerina L. Jimmieson, and Andrew Griffiths. "The Impact of Organizational Culture and Reshaping Capabilities on Change Implementation Success: The Mediating Role of Readiness for Change." Journal of Management Studies 42, no. 2 (March 2005): 361-386. Weiner, B 2009, 'A theory of organizational readiness for change', Implementation Science, 4, 1, p. 67. 28 © Atul Kuver 2011
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