ms-25 mba assignment july dec 2010 Question 2

2. Discuss the importance of cultural change and its process in an organization. Briefly describe how cultural change was managed successfully with reference to an organization you are familiar with. Briefly describe the organization you are referring to.  

            Cultural Change - Cultural change typically refers to radical versus limited change. It is not easy to achieve; it is a difficult, complicated, demanding effort that can take several years to accomplish. There are three basic types of cultural change Revolutionary and comprehensive efforts to change the culture of the entire organization -Efforts that are gradual and incremental but nevertheless are designed to cumulate so as to produce a comprehensive reshaping of the entire organizational culture -Efforts confined to radically change specific subcultures or cultural components of the overall differentiated culture. Strategies for effecting cultural change include  -Unfreezing the old culture and creating motivation to change –Capitalizing on propitious moments—problems, opportunities, changed circumstances, and/or accumulated excesses or deficiencies of the past- Making the change target concrete and clear -Maintaining some continuity with the past -Creating psychological safety through a compelling positive vision, formal training, informal training of relevant groups and teams, providing coaches and positive role models, employee involvement and opportunities for input and feedback, support groups, and addressing fears and losses head on -Selecting, modifying, and creating appropriate cultural forms, behaviors, artifacts, and socialization tactics
-Cultivating charismatic leaders -Having a realistic and solid transition plan
-Exercising risk management by understanding and addressing the risks and the benefits as well as the potential inequitable distribution of these risks and benefits.
Four essential strengths of the organizational culture approach:
It focuses attention on the human side of organizational life, and finds significance and learning in even its most mundane aspects (for example, the setup in an empty meeting room).

            It makes clear the importance of creating appropriate systems of shared meaning to help people work together toward desired outcomes. It requires members—especially leaders—to acknowledge the impact of their behavior on the organization’s culture. Morgan proposes that people should ask themselves: "What impact am I having on the social construction of reality in my organization?" "What can I do to have a different and more positive impact?"It encourages the view that the perceived relationship between an organization and its environment is also affected by the organization’s basic assumptions.

            Morgan says, We choose and operate in environmental domains according to how we construct conceptions of who we are and what we are trying to do. . . . And we act in relation to those domains through the definitions we impose on them. . . . The beliefs and ideas that organizations hold about who they are, what they are trying to do, and what their environment is like have a much greater tendency to realize themselves than is usually believed. Discuss how organizational culture change can take place. Describe the culture change process with reference to your organization or an organization you are familiar with. Briefly describe the organization you are referring to..

            

            Any organization cultural implementation is a change. Define the culture very clearly. Before implementation, introduce ''change management'' Merely saying '' good culture” is not good enough.                                                     

            It can mean many things to many people. Good culture comes in many shapes like – value based culture.– competitive culture learning culture productive culture etc. once you define the culture  ''clearly'', it become very easy to implement it. Here is an example of ''implementing value based culture''. The organization I am referring to organization, I am familiar with is a-a large manufacturer / marketer of safety products - the products are used as [personal protection safety] [industrial safety] – the products are distributed through the distributors as well as sold directly – the products are sold to various industries like mining / fire services / defence / as well as to various manufacturing companies.- the  company employs  about  235 people - the  company  has  the following  functional   departments

·         Marketing

·         Manufacturing

·         Sales

·         Finance

·         Human

·         Customer  

·         Warehousing

·         Transportation

·         TQM

 
IN THIS COMPANY, WITH WHICH I AM ASSOCIATED, (Hanil Automotive Ltd.)

Value based culture is the management approach that ensures corporations are run consistently on value, such as – maximizing shareholders value –adding values to the customers' service. etc

THIS INCLUDES

·         Creating value in all actions / strategy               

·         Managing for values – measuring value with the help of metrics etc etc

THE EMPLOYEES  WHO  LIVE  BY  THE VALUES OF  THE  ORGANIZATIONS SHOW  IT  BY  THEIR  EFFORTS / PURPOSE/DIRECTION/SUPPORT.

·         By aligning all their actions/programs with the organization’s vision.

·         By aligning all their actions/ programs with the organization mission.

·         By aligning all their actions/programs with the organization objectives.

·         By aligning all their actions/programs with the organization strategies.

·         In maximization of value creation for customers                

·         In increasing value for company products for the market               

·         In aligning company activities with the interest of shareholders

·         In maintaining quality communication internally/externally

·         In allocation of resources [finance]           

·         In allocation of resources [human resources]

·         In handling complexity in operation            

·         In handling uncertainty in operation                

·         In managing risks in operation.

·         In planning / budgeting                                   

WATCH THE WORK PRACTICES:                    

            Direction- management's style and attitude as it affects employees Commitment-attitudes towards work and the organization Recognition –motivation and recognition of employees Collaboration – cooperation and team work within groups and departments

WATCHTHECULTURALVALUES

            Risk – attitudes toward risk taking, structure and ambiguity Individuality –attitudes toward contribution and self reliance Compliance attitudes toward rules and exceptions. Dominance – attitudes towards hierarchy, power and equality.

WHAT   ROLE  IS  PLAYED  BY  TOP  MANAGEMENT  IN  THIS ORGANIZATION,IN  CREATING  VALUE  BASED  CULTURE  SYSTEM?
            The top management in creating value based culture system provide value based corporate vision to:       

·         develop a value base admission statement           

·         provide a value based corporate objectives   

·         provide a value based corporate strategies

·         provide a value based corporate Communication System

·         provide a value based corporate governance       

·         provide a value based corporate culture                                   

·         provide a value based corporate organization structure provide a value based corporate  Management Style       

·         provide a value based corporate Decision making process.          .

·         provide a value based corporate performance Management System

·         provide a value based corporate Reward Process

·         provide a value based corporate Clear Management priorities             

·         provide a value based corporate Balance Between Short Term / Long Term Trends.     

·         provide a value based corporate Shared Values                              

·         provide the required skills to the employees etc. 

IN IMPLEMENTING CULTURAL CHANGE, WHAT WE DO

-DEFINE THE CULTURE VERYCLEARLY.- ''CHANGE  MANAGEMENT'' IS MORE IMPORTANT THAN CULTURE ITSELF.

-What I have suggested is a blend of guidelines/ideas/concepts on the process of managing the change of culture in an organization.

I must also emphasise that the culture change is always done with a purpose.

ORGANIZATION CULTURE / CHANGE:

            Organizational culture ultimately determines whether or not any improvement initiatives/CHANGES   will be successful. Culture defines the work environment. The organization can design the most efficient possible work processes, acquire the very best management information systems, and employ state-of-the-art high   technology, but unless the culture is prepared for change, improvement efforts will fall short. Management teams that must reduce costs and improve performance are immediately confronted with a daunting challenge that they will ignore only at their peril: how does one go about changing the organization’s culture? Understanding Change Management. It is axiomatic that constructive change cannot be imposed from the top. This change formula elegantly explains why this is true and points the way to successful change implementation.

The Change Formula:                         

                 

                       C=VxD>R

Where:
C  =  Change                    

V  =  A positive vision for the future.

D =   Dissatisfaction with the status quo, and

R = Natural human resistance to change.

            If you have ever put forward a great idea only to have it rejected or ignored by the very people whom it would most benefit, you will appreciate the change formula. The formula says that constructive change will occur in an organization only when a positive vision for the future multiplied by dissatisfaction with the status quo (the relationship is not linear) is greater than the natural human resistance to change.
This organization’s culture is defined by the beliefs of its CEO, executives, managers, staff and specialists; the assumptions upon which those beliefs are based; and the behaviors that rest upon those assumptions. Human beings are creatures of habit.

            Here is a simple approach / guideline for Creating change:

1. Establish a sense of urgency communicates the business situation or reason for implementing the culture change — why is it necessary?

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2. Create the guiding coalition Establish a team with the knowledge to initiate change and the power to make the change happen

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3. Develop a vision and strategy Develop the organization’s vision for the change and the strategies for implementation.

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4. Communicate the change vision Share the vision and how it will affect the participants -----------------------------------------------------------------------------

5. Empower broad – based action Give the CHANGE team the authority to initiate the changes
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6. Generate short-term wins Work with the practice groups that are most likely to accept THE CHANGE and celebrate their achievements

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7. Consolidate gains and produce more change Use success to create more success.

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8. Anchor new approaches in the culture Make the CHANGE initiatives apart of the daily work process of the firm.

THE MOST IMPORTANT POINT TO NOTE IN CHANGING ''CULTURE” IS THE ''TRANSITION''WHY?

            Because transition occurs in the course of every attempt at change.
Transition is the state that change puts people into. The change is external (the different policy, practice, or structure that the leader is trying to bring about),  while transition is internal (psychological reorientations that people have to go through before the change a work). The trouble is, most leaders imagine that transition is automatic -- that it occurs simply because the change is happening. But it doesn't. Just because the computers are on everyone's desk doesn't mean that the new individually accessed customer database is transforming operations the way the consultants promised it would. And just because two companies are now fully "merged" doesn't mean that they operate as one or that the envisioned cost savings will be realized.
Even when a change is showing signs that it may work, there is the issue of timing, for transition happens much more slowly than change. That is why the ambitious timetable that the leader laid out to the board turns out to have been wildly optimistic: it was based on getting the change accomplished, not on getting the people through the transition.
Transition takes longer because it requires that people undergo three separate processes, and all of them are upsetting.

             Saying Goodbye. The first requirement is that people have to let go of the way that things -- and, worse, the way that they themselves -- used to be. As the folk-wisdom puts it, "You can't steal second base with your foot on first." You have to leave where you are, and many people have spent their whole lives standing on first base. It isn't just a personal preference you are asking them to give up. You are asking them to let go of the way of engaging or accomplishing tasks that made them successful in the past. You are asking them to let go of what feels to them like their whole world of experience, their sense of identity, even "reality" itself.

             On paper it may have been a logical shift to self-managed teams, but it turned out to require that people no longer rely on a supervisor to make all decisions (and to be blamed when things go wrong). Or it looked like a simple effort to merge two work-groups, but in practice it meant that people no longer worked with their friends or reported to people whose priorities they understood. Shifting into Neutral. Even after people have let go of their old ways, they find themselves unable to start a new. They are entering the second difficult phase of transition. We call it the neutral zone, and that in-between state is so full of uncertainty and confusion that simply coping with it takes most of people's energy. The neutral zone is particularly difficult during mergers or acquisitions, when careers and policy decisions and the very "rules of the game" are left in limbo while the two leadership groups work out questions of power and decision making.

            The neutral zone is uncomfortable, so people are driven to get out of it. Some people try to rush ahead into some (often any) new situation, while others try to back-pedal and retreat into the past. Successful transition, however, requires that an organization and its people spend some time in the neutral zone. This time in the neutral zone is not wasted, for that is where the creativity and energy of transition are found and the real transformation takes place. Today, it won't take 40 years, but a shift to self-managed teams, for instance, is likely to leave people in the neutral zone for six months, and a major merger may take two years to emerge from the neutral zone. The change can continue forward on something close to its own schedule while the transition is being attended to, but if the transition is not dealt with, the change may collapse. People cannot do the new things that the new situation requires until they come to grips with what is being asked.

            Moving Forward, some people fail to get through transition because they do not let go of the old ways and make an ending; others fail because they become frightened and confused by the neutral zone and don't stay in it long enough for it to do its work on them. Some, however, do get through these first two phases of transition, but then freeze when they face the third phase, the new beginning. For that third phase requires people to begin behaving in a new way, and that can be disconcerting -- it puts one's sense of competence and value at risk. Especially in organizations that have a history of punishing mistakes, people hang back during the final phase of transition, waiting to see how others are going to handle the new beginning.

             Most leaders come from backgrounds where technical, financial, or operational skills were paramount, and those skills provide little help when it comes to leading people through transition. Such leaders may be pushing the limits of their understanding of the future, and they need perspective and advice. That is where a trusted colleague, confidant, coach, or consultant can offer valuable counsel to the leader. This person's background or professional affiliation can vary widely; what matters is that she or he understands how to help people through transition. It is a role that is far more interpersonal and collaborative than is played by most consultants or trainers accustomed to teaching a skill or prescribing a solution. No training program can prepare a leader for managing a transition. Yet no leader can effectively lead change -- which is what leadership is all about -- without understanding and, ultimately, experiencing -- the transition process. What leaders need, instead, is individualized assistance whereby they learn to create plans to bring their followers through the particular transition that they face -- not through generic "change." A trainer can teach leaders a generalized approach ("The Ten Steps..."), but a good coach can help the leaders to discover their own best approaches. Work with their own goals, limitations, and concerns to create a development plan that prepares them for the future. Times of transition are becoming the rule rather than the exception. Yet few leaders know how to prepare for the changes that lie ahead. Transition leadership skills must be congruent with, must capitalize and build on, the leader's own strengths and talents. They cannot be found in a set of theoretical leadership skills. The transition adviser works collaboratively with each leader to assess the leader's place in the three-part transition process, the strengths the leader brings and how to leverage them, and what the current situation demands. It is a personal and completely customized process.