Week 7

Managing change and innovation

CHAPTER 11
 • Today’s organisations face
continual change
• Change refers to the
adoption of a new idea or
behaviour by an • What happened that
Turbulent organisation forced these companies to
• Failure to change can lead respond accordingly?
times and to survival issues
• Examples include:
the changing • Amazon Pharmacy
• Apple
workplace planning
succession

• Microsoft cloud
technology
• Netflix producing
original content
• UberEats
• Alibaba digital
payments
• GE investing in greener
energy
Innovation and the
changing workplace
2 approaches to change:
• Ambidextrous approach
• Disruptive approach
 Disruptive change

• Refers to innovations that radically change an

industry’s rules of the game for producers and
consumers
• Changes can be in:
–Products
–Services
–Processes

•The disruptive approach recognizes that established

companies often struggle to respond to disruptive
innovations due to their focus on sustaining their current
offerings. This can create opportunities for new entrants
to gain a foothold in the market
 The goal of an ambidextrous organization is to balance the need for both
exploration and exploitation in its organizational strategy and organizational
development. Exploration involves developing new products, services, or
processes, while exploitation focuses on optimizing existing ones.

Ambidextrous
approach to Allows flexibility with control to ensure targets are met
change

The ambidextrous approach recognizes that overemphasizing one aspect

(exploration or exploitation) can lead to imbalances. Overemphasis on
exploitation can lead to stagnation and vulnerability to market disruptions,
while overemphasis on exploration might lead to resource allocation issues
and lack of focus.
 New-product changes
Changing
• A change in the organisation’s
things: new product or service output.
products and
technologies Technology changes
• Change which relates to an
organisation’s production
process.
 Changing Exploration
things: Three • New ideas are generated
critical
Cooperation
innovation
strategies for • Mechanism for both internal and
external coordination made available
changing
products and Entrepreneurship
technologies • Person within organisation who can see
the need for and champions productive
change within the organisation
Three innovative strategies for new
products and technologies
Group Activity - Innovation
Students are to explore innovative solutions for designing a more efficient and effective classroom layout, fostering creativity,
problem-solving, and collaborative skills.

Brainstorm ideas for improving the classroom layout. Consider factors such as seating arrangements, furniture placement,
lighting, technology integration, and accessibility or any other aspect that may be necessary.

Teams are to explain their design choices, highlight how their layout addresses efficiency and learning needs, and showcase any
unique features or innovations. How might these innovative ideas impact the learning experience in a classroom.

Other teams are to provide feedback on each design and provide constructive feedback.

Teams will then select and rate each design.

Activity cont’d
Points to consider:
• What factors went into your design.
• How did innovation influence your design.
• Did teamwork and collaboration improve or hinder your design.
 COOPERATION

72 per cent of top executives surveyed by BusinessWeek and the

Boston Consulting Group reported that innovation is a top priority, yet
almost half said they are dissatisfied with their results.

Therefore, many companies are seeking to transform the way they

find and use new ideas by improving cooperation, and internal and
external coordination.
 Internal coordination

Horizontal linkage model Fast-cycle team

• An approach to product • A multi-functional team that

change that emphasises is provided with high levels of
shared development of resources and empowerment
innovations among several to accomplish an accelerated
departments product development project
 External cooperation

External coordination Open innovation

Organisations look outside their boundaries to Extending the search for and commercialisation
find and develop new ideas. One can build of new ideas outside the boundaries of the
partnerships, alliances too organisation
Coordination
model for
innovation
 Entrepreneurship
and innovation roles

• Mechanisms to make sure new ideas are

carried forward, accepted and
implemented
• Requires roles in organisation:
– Inventor
– Champion
– Sponsor
– critic
• A new idea champion:
– sees the need for and champions
productive change within the
organisation.
Four roles in
organisational
change
 Changing people
and culture

• People change
– Changing the attitudes and
behaviours of a few employees
by providing them with training
opportunities.
• Culture change
– A major shift in the norm, values,
attitudes and mindset of the
organization.
 How to Manage Changing people and Culture

Changing Training and development

people and • Most frequently used approach for change

culture Organisational development: specific actions for specific changes

• Planned, systematic process of change that uses application of behavioural science

techniques to improve organisation health and effectiveness through its ability to cope
with environmental changes, improve internal relationships and increase learning and
problem-solving capabilities.
 • Organizational development (OD) is a planned effort
aimed at improving the overall effectiveness and
health of an organization through planned
interventions. It involves systematic approaches to
change management, focusing on enhancing
organizational processes, structures, and culture to
Organisational adapt to internal and external challenges, improve
development performance, and achieve strategic goals.
• Planned, systematic process of change that uses
(OD) behavioural science knowledge and techniques
• Improves organisational health and effectiveness
through:
• Ability to cope with environmental changes
• Improvement of internal relationships
• Increased problem-solving capabilities
(contd.)
Organisational OD can address 3 types of current problems:
1. Mergers and acquisitions
development 2. Organisational decline/ revitalisation
contd. 3. Conflict management (contd.)
 Organisational
development
Activities contd.
OD activities include:
1 Team-building
activities
2 Survey-feedback
activities
3 Large-group
interventions
(contd.)
 OD Steps:
1 Unfreezing
• Participants become aware of problems and
become willing to change.
Organisational
• Use a change agent.
development 2 Changing (intervention)
Steps contd. • Individuals experiment with new
behaviour/skills.
3 Refreezing
• Individuals acquire a desired new skill or
attitude and are rewarded for it by the
organisation.
 Implementing
change is hard
• Creative innovation without
implementation is ineffective in
creating change
• BUT change can trigger
resistance
• Managers need to be aware of
the reasons people have for
resisting change
Resistance to change

• Can be due to:

– Self-interest
– Lack of understanding and
trust
– Uncertainty
– Different assessments and
goals: disagreements over
the proposed benefits of
change
 Implementing
change

• Create a sense of urgency like

performance gap.
Emotion is the key to
persuading.
Make them understand the
reasons why change is needed
• Apply force field analysis
• Use implementation tactics
 • Originator: Kurt Lewin
– Force-field analysis involves identifying and
Resistance - analyzing the forces that either support or
oppose a proposed change. These forces can be
Force-field thought of as "pushing" or "pulling" the
organization towards or away from the desired
analysis change.
– By examining these forces, organizations can
gain insights into potential obstacles and
opportunities, allowing them to develop strategies
to amplify the driving forces and mitigate the
restraining forces.
Force field
analysis
 Traditional Inventory Just-In-Time (JIT)
Aspect System System
Driving Forces
Supply Stability ✔️
Reduced Lead Time ✔️
Efficiency and Cost
✔️
Traditional vs Savings
Lean Production ✔️
JIT Restraining Forces
High Holding Costs ✔️

Risk of Overproduction ✔️

Supply Chain
✔️
Disruptions
Lack of Buffer Stock ✔️
 Specific tactics to overcome resistance:

• Communication and education

• Conveying the benefits and why change is necessary. Educating
employees about the necessities of the change.
• Participation
• Users need to feel involved. Enhances support and ownership of
change. Users have the power to resist.
• Negotiation
• Group has power over implementation. Helps build trust and
Implementation allows for customization of the change process, making
individuals more likely to accept the proposed changes.
tactics • Coercion
• involves using formal authority or power to enforce change
against resistance. It is applied when other implementation
techniques have failed, or a crisis exists.
• Top management support
• Helps to legitimise the change and can influence employees to
align with proposed change. It makes people aware of the
change and give change project legitimacy especially when a
change involves multiple departments and reallocation of
resources.
 Implementation after strategy
and structure for achieving
Implementing mature sustainability is in place
sustainable
development in
the organisation

Assess the starting position

What is our
How are we doing in environmental
Where are ‘we’ now on
terms of stakeholder performance relative to
things?
engagement? industry average and
best practice? (contd.)
 Address resistance to change:
Address • Training and workshops may assist
Implementing
sustainable Offer Offer workshops and training program
development in
the organisation
Use evolutionary approach by
contd. • Carefully choosing pilot projects
• Using incremental building of culture,
Use • Implementation new measures and goals at all
levels of the organisation
Ethical Challenge
 Activity : Innovation Through Change
Simulation
Below are the scenarios:
 A tech company needing to innovate due to emerging competitors: A mid-sized technology company, TechNext,
has been a leader in software development for over a decade. Recently, several new startups have entered the
market, introducing innovative products with advanced features and cutting-edge technology. To maintain its
competitive edge, TechNext needs to innovate by adopting new technologies and enhancing its product
offerings. The company's leadership recognizes that change is necessary to stay ahead but is concerned about
employee resistance and the potential disruption to current operations.

 A retail business adapting to the rise of e-commerce: ShopEase, a mid-sized retail business with a strong
presence in physical stores, has recently noticed a significant shift in customer preferences toward online
shopping, especially post-pandemic. While their physical stores have been the core of their business, the
company has a limited online presence and an outdated e-commerce platform. To stay competitive and meet
customer demands, ShopEase needs to undergo a digital transformation to expand its e-commerce capabilities
and integrate its in-store and online shopping experiences.
 Activity cont..
Each group discusses their assigned scenario and develops a strategy for implementing change to foster innovation.
They should consider the following:
• - What changes are needed? (e.g., process, technology, organizational structure, training, open innovation
culture)
• - How will the changes drive innovation? (New product, customer centric innovation)
• - What challenges might arise during the change process? (Training cost, resistance)
• - How can these challenges be mitigated?