“A revolution is not a bed of roses. A revolution is a struggle between the future and the past.” ~ Fidel Castro
Course Curator: Dr. G. Danford (London Business School MBA, Helsinki School of Economics PhD)
Eight MBA-level sessions covering: Models of change, structural barriers, cultural challenges, and the implementation of change. Speakers include: business school professors (Harvard, Stanford…), corporations (McKinsey, Bain & Co…) and more.
BEFORE YOU BEGIN: We recommend that you test your understanding of this sessions content.
WHY? Because the MOST VALID method for measuring learning is to compare results from a pre/post test of content.
Please make a note of your score for comparison purposes, at the end of this session.
Time Required: 25 min.
6.0 Political Structures
- What are the different interests of people in an organization?
- Is organizational conflict good or bad?
- How to settle conflicts in organizations (bargaining)?
LEARNING MOMENTS from this session:
- We are notoriously bad at predicting the speed of change (Ray Kurzweil).
- Whatever else organizations may be, they are political structures.
- From an organization’s perspective, tactics of withholding and distorting information are the most potentially dysfunctional.
- The reasoning processes employed by individuals in organizations inhibit the exchange of relevant information in ways that make effective learning difficult, and all but impossible in situations in which much is at stake.
- Succeeded in making major changes requires a focus on: Continuity, Anticipation, Contestation, and Mobility.
6.1 Case: How Kodak Failed?
In 1981 Kodak’s CEO, Vince Barabba conducted a very extensive research effort that looked at the core technologies and likely adoption curves around silver halide film versus digital photography. The results produced both “bad” and “good” news. The “bad” news was: digital photography had the potential to replace Kodak’s established film business. The “good” news: it would take ten years to happen. The irony: Kodak invented the digital camera in 1975.
Kodak fired some 20,000 employees in 1997/1998. The year 2000 marks the beginning of a rapid decline in film sales. Kodak stopped selling traditional film cameras in 2004 (15,000 jobs lost). Kodak also closed more than seven film processing labs in the US alone. To top things off there was a recession and the mobile phone camera began to dig into digital camera sales (2005). In 2012, Kodak filed for bankruptcy.
‘They were late to the game in their shift to digital, and they have been playing catch-up ever since (Standard and Poor)
- Kodak’s top management never fully grasped how the world around them was changing. Kodak hung on to obsolete assumptions.
- Digital cameras came to be seen as electronic gadgets, and not photographic equipment.
- With digital, women were no longer the main customers, men were!
- Unwilling to let go of the extremely lucrative (gross margins of nearly 70%) film business, it tried for many years to prolong the life of film
- Kodak did not realize its own limitations, and consequently its strategy for revival never had much of a chance.
Source: WSJ.com and Forbes.com
Failure @Kodak (4:00)
NOTE: this video will start and stop at the pre-assigned times 0:08-3:12
6.2 Organizational Politics
‘Organizational politics involve intentional acts of influence to enhance or protect the self-interest of individuals or groups. Advancement of career and increased power were cited as self-interests that could be furthered through politics. From an organization’s perspective, tactics of withholding and distorting information are the most potentially dysfunctional.’ (B. Mayes, UC Berkeley).
‘Whatever else organizations may be (problem-solving instruments, socio-technical systems, reward systems, and so on), they are political structures. This means that organizations operate by distributing authority and setting a stage for the exercise of power. frank recognition of the importance of personality factors and a sensitive use of the strengths and limitations of people in decisions on power distributions can improve the quality of organizational life’ (A. Zalenil, Harvard Business Rreview).
The 3 R’s of politics:
The 3 R’s (4:30)
NOTE: this video will start and stop at the pre-assigned times 0:17-4:44
6.3 Organizational Learning
In effective organizational learning system people advocate their views in ways that invite confrontation, challenge, and testing publicly. The emphasis is on making underlying assumptions, norms, and objectives open to confrontation. Incongruities between what an organizations espoused objectives and policies and what its policies and practices actually represent, is also challenged. As a result of this, people raise their aspirations about the quality and magnitude of change their organization can take.
‘The reasoning processes employed by individuals in organizations inhibit the exchange of relevant information in ways that make effective learning difficult, and all but impossible in situations in which much is at stake. This creates a dilemma as these are the very organizational situations in which effective learning is most needed. It is only by interrogating and changing the governing values, the argument goes, is it possible to produce new action strategies that can address changing circumstances. Therefore, organizational learning is a process of detecting and correcting error.’ ~Argyris and Schön
Change Barriers (4:00)
NOTE: this video will start and stop at the pre-assigned times 4:45-9:07
Take A Pomodoro Break Now (5 min. to relax & reflect)
Learning always benefits from short breaks.
6.4 Change Happens?
According to Professor J. Kotter (Harvard Business School), ‘businesses hoping to survive over the long term will have to remake themselves into better competitors at least once along the way. These efforts go under many banners: total quality management, re-engineering, rightsizing, restructuring, cultural change, and turnarounds, to name a few. In almost every case, the goal has been to cope with a new, more challenging market by changing the way business is conducted. A few of these endeavors have been very successful. A few have been utter failures. Most fall somewhere in between, with a distinct tilt toward the lower end of the scale.’
‘A great vision can serve a useful purpose even if it is understood by just a few people. But the real power of vision is unleashed only when most of those involved in an enterprise or activity have a common understanding of its goals and directions. if employees do not feel empowered to act they will not support change initiatives adequately.’
‘Unsuccessful transitions almost always founder during at least one of the following phases: generating a sense of urgency, establishing a powerful guiding coalition, developing a vision, communicating the vision clearly and often, removing obstacles, planning for and creating short-term wins, avoiding premature declarations of victory, and embedding changes in the corporate culture. Therefore, realizing change usually takes a long time, but can improve the chances of success.’ (John Kotter, Harvard Business Review)
Implementing Change (4:30)
NOTE: this video will start and stop at the pre-assigned times 9:08-13:27
6.5 Successfully Implementing Change
Success is more likely to occur if the team:
- Define measurable stakeholder aims are defined, and a business case for their achievement is created (which should be continuously updated).
- Monitor assumptions, risks, dependencies, costs, return on investment, dis-benefits and cultural issues.
- Create effective communication that informs various stakeholders of the reasons for the change (why?), the benefits of successful implementation (what is in it for us, and you), as well as details of the change (when? where? who’s involved? how much will it cost? etc.).
- Devise an effective education, training and/or skills upgrading scheme for the organization.
- Counter resistance from employees, and align them to the overall strategic direction of the organization.
- Provide personal counseling (if required), in order to alleviate any change-related fears.
- Monitor the implementation, and fine-tuning as required.
6.6 Strategic Transformation
“In dwelling, live close to the ground. In thinking, keep to the simple. In conflict, be fair and generous. In governing, don’t try to control. In work, do what you enjoy. In family life, be completely present.” ~ Lao Tzu
Professor George Yip has examined the strategies employed by British firms that have succeeded in making major changes, while simultaneously maintaining high levels of performance. Those firms exhibited four features which contributed to a successful transformation:
Changing While Winning (4:30)
Prof. George Yip, China Europe International Business School (CEIBS)
NOTE: this video will start and stop at the pre-assigned times 0:39-5:18
‘The real power of vision is unleashed only when most of those involved in an enterprise or activity have a common understanding of its goals and directions. if employees do not feel empowered to act they will not support change initiatives adequately.’ (John Kotter)
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COMPLETE the Session 6/8 quiz again, and compare your results.
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8-Step Process for Leading Change (kotterinternational.com)
NEXT Session 7/8: CULTURAL PERSPECTIVE
CONTENT: The ‘Learning Organization’ change model, Lazlo Bock (SVP Google People Operations) discusses ‘People Advantage at Google’, Robert Dickman discusses storytelling at Nike, Prof. Jeffrey Pfeffer (Stanford) discusses confidence, plus more theory (cultural perspective on change, classifying organizational cultures, the Meaning Frame, 4 C’s of persuasion, cultural network analysis, power etc.).
What is Corporate Culture (3:00)
Prof. Edgar Schein, MIT
NOTE: this video will start and stop at the pre-assigned times 11:23-14:16