Change management

Published on January 12, 2011 Reviewed on June 30, 2016   39 min

Other Talks in the Series: Change Management

Hello, this is David Lewin. My talk today is on Change Management.
An appropriate starting point for this topic is to ask why change management is so pervasive. In other words, why so many organizations, large and small, public and private, located in North America, Europe, Asia, Central America are so heavily involved in trying to cope with change and the management of change. And I think the basic answer to this question has to do with three factors that have evolved over the last 30 years, which have impacted virtually all organizations around the world. Those three factors are global economic competition, de-regulation, and rapid technological change. And these factors together combined have spurred in all nations and regions of the world greater market capitalism, which in turn reduces concentrated market power such as in the form of monopoly or oligopoly and it reduces organizational stability. It therefore increases decision making uncertainty and this is fundamentally why change management is such a pervasive issue and topic on the contemporary scene.
If the management of organizational change is as pervasive a phenomenon as I have previously described so too is a related one, which is resistance to change. The basics about resistance go as follows. Organizations come into being to produce goods and/or services on a large scale and more efficiently than could be done otherwise. And in the process, these organizations provide order, control, coordination, routines, and norms, which support these stabilizing characteristics. An organization is all about stability, being able to repeat processes and practices over time to generate goods and services. And everything about these organizations emphasizes this particular set of stabilizing characteristics. Therefore, when an organization is threatened by changes in the external environment, by such things as increasing global competition and/or de-regulation and/or rapid technological change, these forces will be disruptive to the existing order, the existing control, the existing coordination, the existing routines, and the existing norms of that organization. This is why the common situation is for people in organizations to resist change. They fear the unknown and don't like to see or have to cope with the disruption that is caused by moving away from the stable or known situation. A very good analysis of resistance to change was provided long ago, specifically in 1948 by Lester Coch and John R.P. French in an article titled Overcoming Resistance to Change that appeared in volume I of the British Journal Human Relations. It's well-worth a read on resistance to change.
To more fully pursue the topic of change management in this talk, I'm going to emphasize two analytical frameworks. The first is ambidextrous organizations and the second is leading change or why transformation efforts fail.
The idea of ambidextrous organizations comes from the area of organizational ecology that is the study of why some organizations survive and prosper despite many changes in the environment around it, why other organizations muddle through and perform mediocre, and why still other organizations fail. This is known as the area of organizational ecology. And people who specialize in it focus on the evolution of particular organizations. And the emphasis in the ambidextrous organization framework is on periods, sometimes quite long periods, in which organizations evolve and face a whole variety of modest or incremental change requirements, raising or lowering a product price here or there, opening up an office in a new location, deciding on a new information technology system. These and many more incremental types of changes are one component of the ambidextrous organization's framework. The other component which refers to change that occurs much more infrequently is revolutionary change, a change that requires a fundamental redirection of an organization, a fundamental change in strategy, a fundamental change in vision, in operating systems and processes. That type of change can be seen as punctuating the equilibrium that has been established previously as an organization responds to a whole variety of incremental changes. That is to say, for most organizations, incremental or modest change occurs very often, revolutionary change occurs very rarely, and when it happens, it punctuates the prior equilibrium that was established through a series of incremental changes. Stated another way, over time, the fittest organizations survive and the non-fittest go out of existence. This is a Darwinian view of organizations, but one supported by a great deal of evidence and examples.