CHAPTER 10 | Organizational Change & Innovation: Lifelong Challenges for the
10.1 The Nature of Change in Organizations
Small changes cause uneasiness, large changes can cause stress. And as managers you will have
to deal with both.
Fundamental Change: What will you be called to deal with?
Identify and prepare for the future that has already happened by looking at the
fundamental changes that are happening now
The market place is becoming more segmented & moving toward more niche products.
We have “demassification” with customer groups becoming segmented into smaller and
more specialized groups responded to narrow targeted messages.
The future of business is
selling less of more, only need to sell a few of each product since you produce so many.
There are more competitors offering targeted products, requiring faster speed-to-market,
“speed is emerging as the ultimate competitive weapon”
Some traditional companies may not survive radically innovative change,
.since film is becoming irrelevant it is hard for them to survive
China, India, & other offshore suppliers are changing the way we work- globalization,
Other countries look to the US for technology and finance
Knowledge, not information, is becoming the new competitive advantage. Knowledge
work is analytic and involves problem solving and abstract reasoning.
systems, like inventory management and A/R are being outsourced.
Two Types of Change: Reactive Vs. Proactive
Reactive Change: Responding to unanticipated problems and opportunities
making changes in response to problems or opportunities as they
arise. Respond to surprises
with less time because you didn’t know about it
Proactive Change: Managing anticipated problems and opportunities
involves making carefully thought-out
changes in anticipation of possible or expected problems or opportunities
Force for Change: Outside and Inside the Organization
Forces Outside (external),
Demographic Characteristics- more diverse workforce-age, education, skill level, gender
Market Change- mergers, new partnerships with suppliers, employees, and competitors,
Technological Advancements- information technology, DVD piracy and counterfitting
Social and Political Pressures- social events, greenwashing-making misleading
statements about products helping the environment, this is opposite of green
Forces Inside (internal)
Employee problems- high absenteeism and turnover, unmet needs, job dissastifcation