In the End, Is It Only Leadership Which Matters in Business - Example

In The End, Is It Only Leadership Which Matters In Business Chapter 1 INTRODUCTION The Management of Change is a subject that is destined to be with us for many years to come, while people adjust to a world of work that is likely to be more fragmented than previous generations had come to expect. In the middle of the last century it would be fair to say that most people expected to choose a trade, profession or occupation and, if they wanted to, stay in it until retirement. Popular authors frequently refer to a period of stability after the Second World War when full employment was the objective of governments, whether in the Western world or in the more managed economies to be found elsewhere. If we accept the findings of Expectancy Theory (Vroom, 1964), we would anticipate that most individuals looked forward to a stable experience of employment, which started with specific qualification levels and induction training and then proceeded through various promotions, accompanied by appropriate incremental pay rises. For many, the prospect of working for one employer enabled individuals to plan their lives, and to invest in a family and property with the security of feeling that they could discharge these responsibilities with a reasonable prospect of consistent success. Individuals might freely embark on change should opportunity arise elsewhere or an alternative offer be made in the same sector. he post-war consensus of providing employment for all broke down and the assumptions that underwrote motivation at work and career development came to be questioned. Interestingly, the full development of the all-providing organization had emerged in the terms of Human Resource Management (HRM) (Beer, 1984). It could be said that traditional personnel management during the twentieth century had offered the prospect of managed motivation leading to productivity and achievement of organizational objectives (Storey, 1989; Sisson, 1994). However, now there came a philosophy that was far more comprehensive and combined performativity with personal commitment to the organization (Fournier and Grey, 2000). The outcomes of HRM could be listed: ■ Quality ■ Flexibility ■ Commitment ■ Strategic integration. (Guest, 1989) There were even those who saw a psychological contract in which transactional elements (money in return of work and effort) were balanced by relational elements (loyalty and trust), which would explain the internal calculation that an individual might make during his or her experience at work (McNeil, 1985; Rousseau, 1998). This obligingly cohesive and easily managed world could not be expected to survive what was to be a decade of monetarism in which businesses were projected into a financial accountability, which would find them struggling to survive without radical downsizing or merger. The alluring prospect of reducing what for most businesses accounted for 75 per cent of overhead - staff costs - could only lead to the competitive drive to become lean and risk averse (Peters and Waterman, 1985). Excellence came at a price and the right formula for a company's survival could well mean reduction in numbers and arbitrary termination of employment contracts. The effect of this on individuals became the focus of increasing research (Jahoda, 1982; Little, 1976; Smith, 1985; Swinburne, 1981). The consequences were found to impact on not just workers directly affected in this way, but also those employees who remained in work and had witnessed how their peers had been treated (Hallier and Lyon, 1996; Hallier and James, 1997). The implications of this imposition of change also affected the rationale of much public sector employment. Governments were not slow to see the value of reducing head-count in sectors for which they were responsible. Performativity could offer the prospect not just of reduction of overhead but also the functional flexibility that unionized environments had precluded in the past. The debate about the rights of private profit makers to undertake publicly funded services is with us still. But the drive for what was sometimes referred to as New Public Sector Management is unlikely to recede (Fox, 1991; Pollitt, 1993). Chapter 2 MANAGING CHANGE The claim that change at work can be managed is not a new position. The history of industrialization offers myriad examples of organizations evolving in all sectors. New technologies have always driven the search for new applications, which in turn provide the competitive advantage to those who first implement them. Unsurprisingly, it often meant for workers increased productivity imposed with no necessary compensating benefits (Littler, 1985; Melling and McKinlay, 1996; Gall, 2003). Into that world of change came initiators, inventors and managers of change who offered business owners new ways of implementing such competitive advantage. Taylorism is a prime example of Ford's investment in performativity linked to production, but following this application of derived productivity to systematic management were many others whose names are equally well known. Most students of social sciences will have heard of Lewin (1947) who addressed the forces for and against change and attempted to manage the process with groups of workers using group work. His research influenced many practitioners who took part in facilitating that work and who went on to research and write in the field of management and motivation in their own right. Among them were such well-known names as Argyris, Schein and McGregor, to name but three of those who continued and developed his work. However, it took the excellence literature to bring popularity to writings on the management of change. Academics such as Porter and Kanter became household names among the advocates of proactive intervention and positive interpretation of the imposed management of change. Practising managers and students alike found such contributions accessible and readable. They often reinforced an optimistic belief that it was possible to bring about change at work without inducing resistance or alienation in those on whom it was imposed. Not surprisingly a range of texts appeared for students and managers wanting to investigate good practice and the theoretical principles that underpin the practice of change management (Burnes, 1992). They balanced the theoretical and the empirical using different approaches, sometimes illustrating theory with practical examples or alternatively offering case study-led comment on practical contributions to an exponentially burgeoning literature on the successful implementation of change. At the foundation of such theorizing lie the findings of researchers. Such contributors, mostly academics, enter into the world of work carrying with them a set of tools and a set of assumptions (Weick, 1995). Some come from the Labour Process tradition, which has its roots in the assumption that the employer-employee relationship is inherently exploitative. Others have a more critical approach, perhaps accepting the necessary interaction of worker and manager whilst seeking to evaluate critically the outcome of management strategies and their intervention in the workplace. Such work often finds its initial publication in periodicals and journals and in edited volumes of assembled contributions (McKinlay and Starkey, 1998). Change is the third C. We already know that customers and competition have changed, but so, too, has the nature of change itself. Foremost, change has become both pervasive and persistent. It is normality. Moreover, the pace of change has accelerated. With globalization of the economy, companies face a greater number of competitors, each one of which may introduce product and service innovations to the market. The rapidity of technological change also promotes innovation. Product life cycles have gone from years to months. Ford produced the Model T for an entire human generation. The life cycle of a computer product introduced today might stretch for two years, but probably won't. A company in the pension business recently developed a service to take advantage of a quirk in the tax laws and interest rates. Its anticipated market life was exactly three months. Coming to this market late by just thirty days would have cut the company's selling time by a third. Chapter 3 DIFFERENT TYPES OF CHANGE The way we define change depends on what we envisage change to be, how it fits into the model of 'organization' in use and the theoretical foundations from which the model or definition model is derived. The simplest idea of change is probably the incremental model. Here, the shift is a change in process, perhaps associated with implementing productivity changes. Much that has passed for Total Quality Management during the years of its popularity could be seen within this type of change. In simple terms, there was the way the production process was organized before the change; the plan embodying the new method of production; a period of transition during which new procedures and equipment would be put in place; and the final new procedure reinforced by training and reward which would supersede previous practice and bring about the newly expected yields anticipated by the change in the first place (Burnes, 2000, 254). Devolving a plan of action for such change underpins many different planned change schemas. They often involve steps which are offered to the prospective manager of change and relate quite well to problem solving schemas, too. It is a way of examining the management steps similar to Fayol's Collins gives a typical example of such a schematic change model: 1 Develop strategy 2 Confirm top level support 3 Use project management support ■ Identify tasks ■ Assign responsibilities ■ Agree deadlines ■ Initiate action ■ Monitor ■ Act on problems ■ Close down 4 Communicate results. (1998, 83) It gives the impression of offering control based on predictive steps and conceals possible complexity at the level of identifying tasks. At this point we are presented with the systemic approach to change. If there is a system which underwrites any process, then it is possible to proceed in the way suggested. Any system, by definition, is designed in a way that makes it possible to follow a sequence and thereby replicate a result or intervene in the process in a predictive way. If we were changing a wheel on a car the steps would be as follows: 1 Loosen nuts on wheel of car 2 Affix jack to car chassis 3 Raise wheel until tyre is clear of the ground 4 Remove nuts from wheel 5 Remove wheel 6 Fit spare wheel to car 7 Tighten nuts to wheel 8 Lower jack and remove 9 Make final tightening adjustment to wheel nuts. Collins deals with this type of change under the heading of 'under-socialized models of change'. Examples given are often mechanical and have been designed in a particular sequence. Those who know the sequence can solve any problem arising and they will do so by following the steps designed into the system. A second type of change is referred to by some authors as punctuated equilibrium. It is associated with the work of Miller and Friesen (1984). It is suggested that the idea of revolutionary or fundamental change is characteristic of the type of change. Its proponents see a similarity between the claims of evolutionary change in the natural sciences to the same kind of change process in organizations. The problem that we have with this descriptor is finding examples that will distinguish it from the previously discussed incremental change. Equilibrium as a word suggests that there is a steady state which is somehow disturbed - hence the punctuation leading to a new and different state of equilibrium following the change intervention. A simple example might be an aircraft in flight, which is acted upon by the four forces of flight that hold an aircraft steady in straight and level flight. Intervention on the controls by the pilot disturbs the equilibrium; the plane climbs or descends until the desired flight level is reached. The controls are set to normal and the plane resumes straight and level flight at a different altitude. The claims made about organizational change sometimes seamlessly pass over assumptions about managers, workers and the ways in which they work together to achieve successful results. In the first place, the journalistic claims often found in popular management texts, that change is greater now than it was in the past, are impossible to substantiate. There may be some surface validity to claims that technological change appears to have accelerated in some sectors and that, as in this example, computers are an obvious driver of such increasing change. However, the changes which presaged the Industrial Revolution may well have seemed to come as suddenly and have impacted as significantly on ordinary people in a similarly surprising way. Unfortunately, there is no way of making accurate comparisons. The reason for this will include our inability to assess what individuals find surprising and how they interpret that surprise. So, even in this first question we have cut across the debate on structure versus actor: structures, be they the ways processes are organized or the ways individuals work, are always liable to be threatened by the need for change. However, the actor side of the argument reinforces the need to acknowledge that the responses to such change lie with the individuals themselves: they may find the experience exhilarating or profoundly depressing. In most cases commentators cannot assume that the response of individuals will be uniform. To assert that an organization decides to sack people or develop new products masks the fact that the organization has no brain or critical functions of itself to accomplish either of these tasks. So, it cannot be responsible for decisions that are the prerogative of the human actors. We would be more correct in describing those actors as a group of managers, say the Board, or an individual, say the CEO. Part of this lapse into personification is the tendency to apply human characteristics to an organization. So, we describe the organization as lazy or slow. Alternatively, we may describe it as quick-witted or responsive. It may be that this seems unduly pedantic. However, the risk of masking cause-effect linkage in this way may obscure the precise dynamics of the event being described. The third of our questions offers the one clear link between assertions of significant change agency and the claims made for leadership in a sector or industry. The standards for hardware and software referred to in the second paragraph may indeed be testable and measurable. In that sense we could agree that such claims for innovation could at least be validated. However, how far such a change by one company could be said to change an industry would be difficult to establish. Similar claims have been made for such innovative examples as the Model T Ford. However, it could be argued that this car did not cause other Model T cars to be produced by competitors, but rather that it triggered competitors to come up with better vehicles, which outstripped the Model T. Standards are therefore comparative, not absolute, and, while they may offer a target initially, they will often be exceeded thereafter. This brings us to the fourth question. What exactly is an 'experience curve'? It could be said that experience is the consolidation of knowledge and skill whose focus is the individual. Individuals working together may well pass on such experience to those they work with. They do this either deliberately, by training say, or through sharing closely in a working environment. There is a tendency in popular management books to impute or imply that such experience can belong to the organization. Sometimes such a phenomenon is described as a learning organization (Senge, 1990). Such learning may indeed be captured in procedures, policies or training manuals, so that others may assimilate and learn from it too. However, while the individual and group may be the base of such learning and experience, there is no guarantee that the organization will capture that newly found knowledge or skill. Indeed, the discussion on managing knowledge and tacit learning should alert us to the fact that individuals can learn at work and deliberately not divulge what they have learned to the organization that employs them. In situations where the expertise of workers exceeds that of their managers there may be no mechanism for requiring knowledge workers to download their expertise in the way suggested (McKinlay, 2000; Willmott, 2000). The excellence literature gave prominence to the idea that excellent organizations exhibit characteristics that exceed the opposition or competitors (Peters and Waterman, 1982). Their people are faster, more responsive, more flexible and, if necessary, more entrepreneurial. They will take risks more readily and are very enthusiastic about pioneering successful products and services ahead of the general run of operators. The assumption that innovation comes from clear-thinking, open and courageous individuals may neglect other factors, which can be significant in whether change is sponsored successfully or not. Increasing evidence suggests that those on greenfield sites may well be better at achieving high standards and fresh approaches than their colleagues on brownfield sites. So, for example, the question of investment in new equipment and premises may often be significant for those seeking to initiate change on traditional sites. A fresh start may well enable managers to select those who are more compliant and accepting of new ways of conducting and transacting a traditional business. We will now look at systems thinking and organizational change. As we do so we will offer opportunities to read some of the claims made by both writers and practitioners of the management of change. As we shall see, the claims made by successful practitioners sometimes overlook the theoretical assumptions that underlie the assertions being made and may therefore make their uncritical adoption uncertain in its outcome. ORGANIZATION AS SYSTEM One of the models referred to is that of punctuated equilibrium. We acknowledge that the idea of a mechanical system lends itself to illustrating how that type of change takes place. What we are invited to see is a series of cause-effect relationships, which allow us to analyse what is going on in an organization. One approach that typifies this is the Congruence Model of Organizational Behaviour (Nadler and Tushman, 1979). The authors offer a framework comprising inputs, transformation processes and. This three-fold model can be found in a similar format in other general accounts of organizations described as input preceding process, which generates output. In this example the headings are further subdivided. First, the Input phase. Here the authors offer three factors: ■ Environment ■ Resources ■ History. The three factors listed are each sufficiently general to allow a range of separate elements within each one. So, environment could include, say, industry factors, market forces, societal influences and so on. Whatever is thought to be significant might be included here. Similar comments could be made about resources. We could include physical resources, financial resources and human resources - factors that might have been included under the headings of capital, land and labour in traditional accounts of the socio-economic factors underwriting work and organization. Finally, there is the summary heading of history, which may itself be a particular view or account of what has occurred in the past and the significance it has for present and future. Together these are schematic headings. They are not predictive or specific elements required by the work process. The second heading of Transformation Process includes the four organizational components, which interact to form that process which lies at the centre of organizational activity: ■ Task ■ Individuals ■ Formal organizational arrangements ■ Informal organization. The components themselves have about them a narrative that commends them to an observer of activities within a work organization. Individuals are often to be found engaged in routine, functional tasks. They rely on and generate formal organizational arrangements to support their activities in a consistent way. However, not everything they do is formulaic - there are variances which the observer might notice and question. The answer would be that these fall into the fourth category of informal organization (1965). Here the traditional elements of task and people remain the same and we might see similarities between the formal organizational arrangement and administrative structure. However, technology replaces the informal organization. What this suggests is that these schematic illustrations of what comprises organizational activity include whatever the authors delineate as being significant rather than an essential set of components such as we might expect to find in a mechanistic account of a planned system. It would be fair to say that the extension of the original components of task and people into the area of competence and reward is not one that would have been evident from the original diagram. The question of 'fit' or congruence, which the author raises, while being important is not self-evident from the diagram. The components themselves act as a catch-all into which different elements can be sorted by the observer or researcher. In some organizations, for example, it would be difficult to define factors as either formal or informal among the various and varying systems that comprise an organization. In some accounts the final component of Outputs includes the following five elements: ■ Goal achievement ■ Resource utilization ■ Adaptation ■ Group performance ■ Individual behaviour and affect. Here, we are offered observable outcomes of organizational activity. However, it could be said that activities like resource utilization and adaptation could be as much part of the process as they are of output. Similarly, the group performance and individual behaviours may be a source of conflict as much as they are of cooperation. For Nadler, then, the list of criteria for the successful management of change is as follows: 1 The organization is moved from the current state to the future state. 2 The functioning of the organization in the future state meets expectations, i.e. it works as planned. 3 The transition is accomplished without undue cost to the organization. 4 The transition is accomplished without undue cost to individual organizational members. (Nadler, 1993, 89) What is offered here is a statement of aspirations, which in its final three parts acknowledges that perceptions will play a major part in the assessment of the success of the change. We might also reflect that the trade-off between individuals and the wider group may well be as much a cause of contention and dissatisfaction as it is of cooperation. Chapter 4 DATA ANALYSIS AND DISCUSSION It seems unlikely that change at work will be in that situation at any time. The first part of the title, managing change, will always be part of the ongoing agenda of any organization, driven at very least by technology and the desire to achieve continuing productivity improvements to provide profit opportunity ahead of the competition. But, as we have seen, much of the prescriptive ness contained in the 'to do' literature assumes that change will be a simply structured or a structural programme, easy to implement and driven by a logic that ought to be apparent to all reasonable people with any knowledge of business need. There may be an occasional flurry of unease or resistance among the workers subjected to such change, but they will quickly realize that newly implemented efficiency factors will make their working life easier and, provided they are supported through the change with the appropriate training, they will soon be quiescent, if not enthusiastic about the change. Perhaps we should not be too hard on the users of the concept of culture, for, indeed, there remains a difficult fault-line between individual attitudes and group perceptions in the context of change. How far the one influences the other is rarely accessible to change agents and is equally difficult for researchers to clarify with subjects, too. What we can see is that the impact of enforced change at work affects not just surprise and sense-making, but also the very identity and discourse underwriting previously held basic assumptions about self, work and society. There are continuing debates which address the practical approaches and concerns now current among practitioners and underlying that discussion there are deeper and more enduring debates about organizations, individuals and the knowledge that is possible in the interactions that take place at work. We will as a postscript offer a sample of both to guide students embarking on continued research. RETHINKING ORGANIZATIONAL CHANGE A recent International Research Workshop held at the University of Sydney addressed the above topic and included several contributions whose findings both summarize some of the points we have discussed here and also draw conclusions about the priorities that can guide future research. The range of papers is not dissimilar from the direction taken in the chapters of this book. First, there is a summary of the styles of change management and the approaches that are often espoused by writers and practitioners. The authors state that 'what unites them is an optimistic view of achieving intentional change' (Palmer and Dunford, 2002, 245). Interestingly, they note that change management is about interpreting and suggest that managers have a role in 'creating meaning for other organizational members and helping them to make sense of the differing meanings attached to events' (Palmer and Dunford, 2002, 247). Such assertions exhibit a touching belief that human beings are always as suggestible as this. The question of meaning and whether it can be managed in the way suggested exercises practitioners and researchers alike. Here, we are often placed back in the debate on culture and how far we can define it, access it and then intervene in a way that could be described as managing it. It should be noted that more thoughtful contributions suggest caution and care in approaching this underlying aspect of change. 'Effective change management is not just about the "hard" structural aspects of organizations, but also requires actions based on an in-depth appreciation of their cultural and human aspects' (Grant et al., 2002, 238). For some writers, discourse remains a critical point of access to the ongoing search for meaning inherent in human experience and the effect of enforced change on subsequent reinterpretation. The search for this continuing account by those involved suggests that emergent change will remain the favoured vehicle for change initiatives, given that it offers the most available opportunities for all participants in the change process to share ideas, thoughts and feelings about the impact of impending change and its interpretation. In this sense, then, 'Discourse itself becomes action that can either aid or hinder change processes and paying insufficient attention to organizational discourse also means foregoing the richness that this lens can provide' (Heracleous, 2002, 255). For some, the enduring belief in the efficacy of metaphors is offered as a way of engaging and promoting images that enable or facilitate different interpretations of change interventions. 'Change agents can employ an organization's prevalent metaphors as a diagnostic tool that reflects actors' ways of thinking about their organization and its need for change' (Heracleous, 2002, 258). It may well be that this is true. However, we would still need to ascertain how far the new imagery has been accepted and whether the change events are being interpreted according to the new metaphor or not. For most researchers that can be a difficult point of access and for managers and change agents almost impossible to know. The question of the agents of change is much more carefully addressed and the step approach is happily less obtrusive in current writings. Indeed, there are even references 'stressing the inherently ambiguous nature of consulting work' (Wright and Kitay, 2002, 272). However, there is a welcome move towards evaluation of work undertaken by change agents. Such developments 'form part of a shift away from the traditional approach to consultancy as an advice-giving activity to one in which consultants are actively engaged in the process of organizational change' (Morris, 2000). Overall, the discussion on the nature and significance of change continues to underwrite the management of change topic. For some writers, that requires revisiting the meaning of change itself and also the context in which change takes place. Specifically, the attempt to deal with change-related issues in organizations may require addressing three challenges: ■ Ambiguous and imprecise ways of talking about organizational change. ■ Changing organizational contexts that require new ways to think and talk about change. ■ The reliance on implicit assumptions about change that may not be relevant in a world of continual change. (Marshak, 2002, 239) Conclusion The topic of change and its possible management will always have a currency with general readers, practitioners and researchers, perhaps for different reasons, but ultimately with a similar purpose: to find out what people experience and whether there is any transferable learning to be derived. There will be those whose focus is managerial and who welcome opportunities to explore strategies that can be applied to achieve successful change at work, and there will be those who believe that a more evaluative approach opens up a reflective vein of research, which is not to be traduced by pragmatic considerations of facilitating change techniques for managers. We may accept that the more hortatory and prescriptive approaches to change management are viewed with more reserve than during the days of programmed and n-step approaches. If so, it is more likely that the emergent stream of research will offer the reflective approach to change with continued emphasis on the individual subjects of enforced change at work. The petits recits that are the foundation of individual discourse enable the researcher to examine the response to change, which includes challenged basic assumptions, possible deconstruction and even reconstruction of perceptions about self, work and society. However, this reflexivity does not take place in a vacuum and is in a sense a crossroads at which the subject reflects not just on his or her responses to enforced change and its implication for sense-making and meaning, but also a point of connection with other influences and other reconstructions surfacing at the same time. The organizational identity discourses referred to in some research is a central concern for individuals in the group and organizational context. The search to make sense of shared experience may well be the source not just of metaphors confected by managers and change agents, but other significant groups as well. Following this tradition of research, then, suggests that metaphors may themselves assume or evoke paradigms and that these paradigms may denote not just differentiation but also ambiguity requiring resolution. The path suggested here could open the way to connections between individuals, groups, ideas and significance, which see the individual as the crossroads between reflexivity and indexicality. A traditional discourse is perhaps threatened by enforced change and the ensuing sense-making may be a focus of an opportunity for the individual to explore a new identity emerging from the deconstruction of previously taken-for-granted basic assumptions. Always the context of individual sense-making is the voice of the other. There is a resonance that may be found here which alerts the individual to either the possibility of reassessed identity and a different discourse or resistance and continued self-assertion in the face of challenge and change. Thus we can safely conclude that in the end, is it only leadership which matters in business. Works Cited Beer, M., Spector, B., Lawrence, P.R., Quinn Mills, D. and Walton, R.E. Managing human assets. New York: Free Press, 1984. Burnes, B. 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