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Chapter 11: Managing Change and Innovation

Terms in this set (49)

Organizational change
Adoption of a new idea or behavior by an organization
Why do people resist change?
-Self-interest
-Lack of understanding and trust
-Uncertainty
-Different assessments and goals
Biggest obstacle to organizational change
Fear of personal loss
Disruptive Innovation
Innovations in products or services that typically start small and end up completely replacing an existing product or service technology for producers and consumers
Reverse Innovation
Creating innovative, low-cost products for emerging markets and then quickly and inexpensively repacking them for sale in developed countries.
Ambidextrous Approach
Incorporating structures and processes that are appropriate for both the creative impulse and for the systematic implementation of innovations
Product change
change in the organization's product or service outputs. Primary way organizations adapt to changes in markets, tech, and competition
Technology changes are designed to...
make the production of a product or service more efficient
Three strategies for changing technologies and products
Exploration: Creativity, new ideas
Cooperation
Innovative roles: new ideas are carried forward for acceptance and implementation
Creativity
Generation of novel ideas that might meet perceived needs or respond to opportunities for the organization
Research shows that successful innovations are often accompanied by...
a high rate of failure
Bottom-up Approach
Encouraging the flow of ideas from lower levels and making sure that they get heard and acted upon by top executives
Idea Incubator
Mechanism that provides a safe harbor where ideas from employees throughout the company can be developed without interference from company bureaucracy or politics
What does keeping research and manufacturing close together help companies do?
Be more innovative
Innovative Company Characteristics
People in research/marketing actively work with customers

Tech. specialists are aware of recent developments and make use of new tech

Shared new product development process is advocated/supported by top management and cuts across functions

Each project has a core cross-functional team
Horizontal Linkage Model (Internal)
Research, manuf., sales, and marketing departments simultaneously contribute to new products and technologies

Important in a high-pressure environment
80% of successful innovators...
periodically test and validate customer preferences during development of new products and services
Open innovation (External)
Extending the search for and commercialization of new ideas beyond the boundaries of the organization and even beyond the boundaries of the industry, sharing knowledge and resources with other organizations and individuals outside the firm
Crowdsourcing
Using the internet to allow thousands of people to contribute to the innovation process
Innovation by acquisition
Buy start-up companies to obtain the innovative products and services and talent

Recognizes the cutting edge of innovation in young, small companies
Idea Champion
Person who sees the need for and champions productive change within the organization
Managers can influence entrepreneurship by...
Supporting entrepreneurship activities

Giving employees autonomy

Rewarding learning and risk-taking
New-Venture Team
Unit separate from the rest of the organization that is responsible for developing and initiating a major innovation.
-Small, loosely structured, flexible
Skunkworks
Type of new-venture team

Separate, small, informal, highly autonomous, secret groups

Focuses on breakthrough ideas
The original skunkworks was created by...
Lockheed Martin
New-venture Fund
Provides resources to develop new ideas, products, or businesses
-support from senior managers are important
People Change
Concerns just a few employees, such as sending a handful of middle managers to a training course to improve their leadership skills
Culture Change
Pertains to the organization as a whole
Two tools to help culture change
Training and Development, and organizational development (OD)
Organizational Development
Planned, systematic process of change that uses behavioral science knowledge and techniques to improve an organization's health and effectiveness through its ability to adapt to the environment, improve internal relationships, and increase learning and problem-solving capabilities
Problems that OD helps address
-Mergers/acquisitions
-Organizational decline/revitalization
-Conflict management
OD Activities
Team-building
Survey Feedback
Large-group Intervention
Traditional Organizational Development Model
Specific problem or group

Limited distribution

time frame is gradual

Learning is individual, small groups
Large-Group Intervention Characteristics
Focuses on entire system

Distrib = widely shared

Time frame is fast

Learning is whole organization
OD Steps
1) Unfreezing
2) Changing
3) Refreezing
Unfreezing
Makes people aware of problems and need for change

Establishes sense of urgency

Uses a diagnosis and change agent
Change agent
OD specialist that performs a systematic diagnosis of the organization and identifies work-related problems
Changing stage of OD
-Individuals experiment with new behavior and skills (intervention)
-Involves emotion and logic
Refreezing
-When individuals acquire new attitudes or values and are rewarded by the firm
-New behaviors and evaluated and reinforced
Need for change
Disparity between existing and desired performance levels
Force-field Analysis
-Kurt lewin
-Change is result of the competition between driving and restraining forces
-Driving: problems/opps that motivate change in firm
-Restraining: Barriers to change
Implementation Tactics
-Top Management Support
-Communication and Education
-Participation
-Negotiation
-Coercion
Top management support is especially important when...
A change involves multiple departments or when resources are being reallocated among departments
Communication and Education
Are used when solid information about the change is needed by users and others who may resist implementation

Education is especially important when the change involves new technical knowledge or users are unfamiliar with the idea

Emotion is key component in persuading and influencing others
Participation
Involves users and potential resisters in designing the change

Approach is time consuming

Helps managers determine potential problems and understand the differences in perceptions of change among employees
Negotiation
More formal means of achieving cooperation

Uses formal bargaining to win acceptance and approval of a desired change
Coercion
Managers use formal power to force employees to change

This approach should not be used because employees feel like victim, are angry at change managers and can even sabotage the change
On average, a U.S. employee's ideas are implemented only once every...
six years
Top management support
Visible support of top management helps overcome resistance to change

Symbolizes to all employees that the change is important for the organization
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