A Change Management Issue - Term Paper Example

A Change Management Issue Introduction That diversity has become the distinctive feature of the postmodern business reality cannot be denied. The past years were marked with the growing commitment to diversity across business, organizations, and individual entrepreneurs. Businesses seek to diversify their staff and consider diversity as the core element of their sustainability and continuous business success. Unfortunately, not always is diversity easy to implement, nor is it always effective, productive, and relevant. With some organizations having spent years in the market, diversity is something new and even unusual. Such organizations spent years to develop and establish their business traditions – the traditions they believe have led them to their current position and the ones they are not always willing to alter. However, the conditions of doing business change continuously, and the postmodern business reality imposes new diversity demands on organizations and businessmen. For many of them, to become more diverse means to produce a profound shift in organizational mentality, consciousness, and culture. Yet, once implemented, diversity has a potential to move the organization further to its performance and organizational highs. Change management issue As long as I can remember myself working for that organization, our staff had been mostly comprised of white males working for the financial department and dealing with the most controversial issues in the field of organizational finance. I must say that the organization had spent years in the market and had been able to achieve considerable success and organizational stability. Its name was well recognized by customers and competitors, whereas its financial staff was believed to be at the core of the organization’s continuous success. The company was extremely careful about all staff members’ following the organization’s cultural and business traditions, and its success and competitiveness in the market made it increasingly reluctant to change anything in its attitudes toward diversity and hiring. However, the business realities were changing, demanding similar changes in our financial department. Our organization had to hire new people, including two black women and one Asian man. All three displayed remarkable performance results but they seemed to experience serious difficulties in their striving to adjust to the new conditions of work. Hostility was equally obvious and veiled: the existing staff members could not accept the idea of a new, diverse workplace and did not realize the potential benefits diversity could give them and their organization, in general. About the organization: In detail My current position is that of Finance Manager in a Veterinary College. The main teaching campus is located in Hertfordshire, and there is also a campus in central London. The college runs three teaching hospitals, with one of them being a drop in a veterinary hospital in London and the other one working as a state of art equine centre in Hertfordshire. My professional obligations require that I constantly interact and cooperate with the rest of the staff, teachers and students, as well as animal owners and veterinary practitioners. The range of issues, with which we constantly deal, includes cash flow and pricing, buildings insurance and animal insurance, complaints and staff accounts. The recent financial crisis became a serious test to the stability and financial operations in the Veterinary College. The college aims at providing superior educational and medical services to students and animal owners. Cultural issues and diversity have been among the most serious organizational problems so far. This is one of the reasons why diversity had to become one of the primary objects of change in the Veterinary College. The feasibility and scope of change According to Open University (2010), change may seem desirable but is not always beneficial. Whether new cultures and attitudes toward diversity are better is one of the most difficult questions in organizations (Open University 2010). However, it is virtually impossible to predict the long-term consequences of initiating a change, even when this change is not emergent but well-planned. Therefore, an organizational change is justified, whenever there is a sense of something being wrong (Open University 2010). The diversity situation in the Veterinary College was far from ideal. Hostility and the lack of cooperation between multicultural employees shifted the balance of performance toward lower profits and soaring culture. A major shift in the cultural consciousness was required, to make diversity an essential component of the organization’s business success. For this purpose, it was necessary to analyze the underlying causes of hostility, to understand what diversity is, to raise diversity awareness in teams and groups, and to make this change work for the benefit of the whole organization. Diversity and change management: Analysis and implications Before the issue of change management is discussed, diversity in organizations must be defined and understood. In general terms, diversity can be defined as “the acknowledgment and respect of differences within and between groups of people. Equality is the framework that enables opportunity, access, and participation and contribution that is fair and inclusive” (Ryan 1993). Very often, organizations hold an erroneous perception that diversity is expressed through the number of black, female, and homosexual employees they have in their staff; however, numerical terms alone cannot suffice to bring the organization to a better competitive position. Diversity as a phenomenon works successfully only when the number of diverse employees in the staff further aligns with the positive changes in the organizational and staff members’ consciousness, which accept diversity as the essential component of their business success. It would be fair to say that effective change management is the key to successful diversity implementation, but before a change management strategy is developed, organizations and staff must grasp the meaning of the most important equity principles and criteria. In this sense, Ryan (1993) provides an excellent account of how equity works in and for the benefit of organizations. According to Ryan (1993), the extent to which an organization is diverse is easy to judge through the prism of the three important criteria: (a) organizational and labor outcomes; (b) the process by which employees achieve these outcomes; and (c) the degree to which the organization adopts policies and structures needed to meet the needs of different employees and groups. The first criterion, or the organizational and labor outcomes, usually implies the use and evaluation of the incomes, which diverse employees earn for one and the same amount of work (Humphries & Grice 1995). However, this criterion seems inapplicable and unreliable when the staff is not diverse and the need to diversify is only emerging. The second criterion, or the processes by which decisions in organizations are made, looks extremely relevant to our case, as long as it implies the need to examine the effects of stereotyping on how and whether diverse workers perform and whether they are given a chance to realize their working potential to the fullest (Humphries & Grice 1995). Such stereotyping affects equally the employment practices within the team of workers and the hiring practices with regard to potential employees. As such, changes are required in how the organization treats its applicants and whether it can detect and reduce the negative influence of indirect discrimination on its performance. Finally, the third criterion covers the policies and structures designed by the organization to meet the needs of the diverse employees (Humphries & Grice 1995). In our organization, diversity policies and procedures had been developed but never really worked – the organization simply did not deem it necessary to incorporate diversity changes into the basic structure of its decision-making principles and standards. However, such policies and procedures may also impact and positive change the staff attitudes toward new diverse employees. Obviously, hiring diverse employees alone cannot guarantee diversity and inclusion in the workplace. Without a profound shift in the organizational mentality, new employees would feel alien and hostile, and would not be able to reveal the wholeness of their organizational and individual talents. It should be noted that a wealth of literature has been written on how diverse groups work and what aspects impact the interpersonal relationships and climate in them. That the presence of diverse employees does not necessarily cause positive changes in group attitudes toward diversity has been long established by scholars. Kossek, Markel & McHugh (2003) write that, on the one hand, the increasing proportion of women and minorities in organizations enable increased in- and cross-group interactions which lay the foundation for the development of improve perceptions and social integration and, consequentially, reduce diversity prejudices. Unfortunately, resistance is a common issue in change management: the inclusion of new employees in a group necessarily implies the need to re-distribute intergroup power and develop new patterns of resource allocation, to pursue equity and equality in workplace opportunities – these are the processes that may generate hostility and negative perceptions in the majority group members (Kossek, Markel & McHugh 2003). In this context, change management initiatives and approaches must be developed, to reduce the pressures on the new minority workers, to help them align with the existing staff members, and let them successfully meet their workplace objectives. In this situation, the two basic questions to answer include (a) what resources are needed to make the change real and successful; and (b) how the change management strategy can be developed and utilized. Whenever organizations initiate changes, the most appropriate type of change needs to be used. The three most common types of changes include transitional, transformational, and developmental (Open University 2010). Both transitional and transformational changes are planned, while developmental changes, which aim at remedying a problematic situation, involve the use of emergent approaches. Emergent and planned approaches exemplify the two opposite sides of the change process in organizations. Emergent approach is less prescriptive than planned change but must take into account the complexity and dynamics of various organizational factors (Open University 2010). Needless to say, emergent changes mostly work like a complex set of regular alterations which ultimately lead to the positive change result (Open University 2010). Here, organizational structure, culture, learning, managerial behavior, and power/ politics are the five fundamental factors hindering or promoting positive change (Open University 2010). It takes a great deal of effort to (a) initiate and (b) realize an emergent change. For this reason, it was essential that the Veterinary College utilized the benefits of both emergent and planned approaches for organizational change: the former would emphasize the need to improve the situation, and the latter would make the change systematic and productive. Available strategies/ solutions – issues to account for In the context of the knowledge-based economy, the use of intellectual capital for a successful change seems relevant and justified. The current state of literature offers a whole range of examples and solutions to organizations and managers, who seek to utilize their intellectual potential for the sake of achieving their change management goals. Intellectual capital can be successfully utilized through the development of the complex conceptual maps, to manage the tangible and intangible resources and model the interpersonal relationships within groups (Lonnqvist, Kianto & Sillanpaa 2009). The intellectual capital can help managers to identify and evaluate the firms’ strategic objectives, link them to the available intangible resources (e.g., diversity and knowledge) and define the set of activities needed to attain these objectives (Lonqvist, Kianto & Sillanpaa 2009). However, intellectual capital alone cannot guarantee the success of the major change management initiatives. When it comes to diversity, the diversity manager’s role is of critical importance; because these are diversity managers who can successfully implement the organizational change they envision (Tatli & Ozlibin 2009). It appears that not only can a diversity manager bring more dynamics into the change management process, but the diversity manager’s roles and ambitions are being influenced by a whole set of organizational factors, which need to be accounted for while developing change management for diversity. Firstly, the relevance, objectivity, and effectiveness of the organization’s diversity policy greatly affect the diversity manager’s actions (Tatli & Ozlibin 2009). These policies and strategies provide hints and, simultaneously, predetermine the barriers and constraints managers encounter in the way to the organizational change (Tatli & Ozlibin 2009). Secondly, the extent to which diversity functions are integrated across different departments, divisions, ranks, and individuals play a crucial role in how diversity managers operate within the boundaries of their organizational power (Tatli & Ozlibin 2009). Finally, the status and position of the diversity office in the general structure of the organization itself establishes a vital source of power and legitimacy for diversity managers (Tatli & Ozlibin 2009). As a result, for the change management initiatives to be effective and relevant, a manager responsible for change must occupy a place in the organizational hierarchy which allows and encourages actions and decisions aimed to implement change and embed new principles and perceptions into the existing organizational structures/ hierarchies. In the context of diversity, change management is an essential source of positive diversity shifts. Communications practices and workplace systems can become the two primary objects of change for any organization that seeks to diversity its staff and turn diversity into a core element of its business strategy. The examples of the diversity workplace systems include mentoring policy, diversity policy mechanisms, bonus programs and rewards for behaviors that facilitate diversity (Cummings 2002). Metrics programs can be developed to evaluate the success of diversity efforts among the staff (Cummings 2002). The changes in systems must be followed by the changes in how employees communicate and treat change: given that all communications patterns influence the quality and effectiveness of retention and recruitment, the diversity message can become the starting point of a positive change in the staff perceptions regarding diversity (Cummings 2002). These changes will set the pace for the development of the new vision and commitment to diversity, which will guarantee that diversity serve the source of the organization’s competitive advantage in the long run. In light of everything that has been written and said in this paper, several solutions could help resolve the diversity situation in the organization. Solutions and criteria The current research into change management provides extensive discussion of various change management strategies and solutions. Directive, expert, negotiating, educative, and participative are the five most common types of change strategies in organizations (Open University 2010). Directive strategies are invariably associated with manager’s decisions and directions (Open University 2010). Expert strategies position organizational change as the process of technical problem-solving (Open University 2010). Negotiating strategies involve the process of bargaining, and educative strategies imply that change is realized by winning the minds and hearts of organizational personnel (Open University 2010). Despite their benefits, none of these strategies would suit the change needs of the Veterinary College. Rather, the fifth, participative strategy would create a foundation for creating and sustaining an atmosphere of diversity and positive growth within the college. Participative strategies are efficient to the extent, which involves all parties and stakeholders in the change process (Open University 2010). The more people are involved the more accepted the proposed change will become (Open University 2010). Even if participative changes would take longer and require more human and financial resources (Open University 2010), they would ensure that the university staff learn from the process of change and shift their attitudes toward diversity in ways that benefit them and the organization for which they work. First and foremost, a diversity message must be developed and delivered for the staff members to accept and understand. That employees know what diversity is, how it works, how it benefits the organization, and how it benefits them will prove the effectiveness of the message in promoting and establishing a new diversity atmosphere in the financial department. Second, a conceptual map of the relationships within the department and the intangible resources available to enhance and maintain diversity should be developed, to identify the diversity blank spots and potential areas for improvement. Third, the changes in communications and work systems must be initiated, to ensure that employees are rewarded for the positive diversity attitudes and behaviors and can communicate effectively their diversity complexities and concerns. Finally, the diversity manager must occupy a place in the organizational hierarchy that allows him (her) developing effective change initiatives and improving the state of diversity perceptions and climate without crossing the boundaries of power and legitimacy assigned to his position. The basic criteria to judge the success of the proposed changes will include (a) the quality and effectiveness of the diverse team’s organizational outcomes; and (b) the presence and utilization of policies and initiatives that meet the needs of the diverse staff. Numerical goals (e.g., the number of diverse employees or their incomes) will not create an objective picture of the diversity change in organization, because the optimal number of diverse workers is easy to determine only via the performance goals and results a diverse team is able to achieve. These criteria will serve the basic instrument of evaluating the effectiveness and sustainability of the proposed diversity change and will, simultaneously, re-direct the proposed initiatives in ways that will turn diversity into an essential element of the organization’s mentality and culture. Conclusion Change management is the best instrument of implementing diversity in organizations. Throughout the development of the organization sciences, the extent to which organizations are diverse was evaluated through the incomes diverse employees earn and the quality of the organizational outcomes they are eager to achieve. Today, managers have a variety of opportunities and strategies to improve the state of diversity in their organizations. Intellectual capital, changes in the working systems and communications patterns, as well as diversity messages, visions, and missions have a potential to cause a positive shift in the organization’s mentality and culture. These are the elements every organization can use to meet the goal of diversity and use the latter as the source of its competitive advantage. The quality of the diverse team’s outcomes and the development of policies aimed to meet the needs of diverse employees will serve the two basic criteria each organization will need to meet, to be considered diverse. References Cummings, AM 2002, ‘Active diversity through change management’, Black Enterprise, July. Humphries, M & Grice, S 1995, ‘Equal employment opportunity and the management of diversity: A global discourse of assimilation?’, Journal of Organizational Change Management, vol.8, no.5, 17-32. Kossek, EE, Markel, KS & McHugh, PP 2003, ‘Increasing diversity as an HRM change strategy’, Journal of Organizational Change Management, vol.16, no.3, pp.328-352. Lonnqvist, A, Kianto, A & Sillanpaa, V 2009, ‘Using intellectual capital management for facilitating organizational change’, Journal of Intellectual Capital, vol.10, no.4, pp.559-572. Open University 2010, Managing and managing people, The Open University. Ryan, R 1993, ‘Women at work: Issues for the 1990s’, New Zealand Journal of Industrial Relations, vol.18, no.1, pp.1-7. Tatli, A & Ozbilgin, MF 2009, ‘Understanding diversity managers’ role in organizational change: Toward a conceptual framework’, Canadian Journal of Administrative Sciences, vol.26, no.3, pp.244-258. Read More