The Process of Implementing Change in Organizational Structure - Literature review Example

The implications of and the Difficulties Involved with Attempting to Change the Structure of an Organization Introduction Organizational structure refers to the coordination of individual and teamwork in an organization. It is important to coordinate and manage individual work needs in order to accomplish organizational goals (Fred, 2010). Organizational structure is an important tool for accomplishing coordination since it is solely involved in reporting relationships, outlining formal communication channels and also outlines how separate actions of individuals are connected together. Therefore, organizational structure forms the framework of the entire organization and also forms the basis, in which operational policies are established (Weiner, 2009). Organizational structure plays an important role in determining and influencing the organization culture. Organizational changes happen when an organization transits from its existing state to desired future state. An organization may attempt to change its structure in order to stay competitive or to adapt to changes within an organization, industry, technological changes or market changes. The focus of this paper is on organizational structure and implications and problems that organization might face in an attempt to change the structure of an organization (Weiner, Amick & Lee, 2008). The process of implementing change in organizational structure encounters various challenges and the main one is resistance to change. Uncertainty regarding the change may also pose a great problem to effective change in organizational structure. According to Weiner (2009) organizational changes are inventible because organizations are progressively facing various and numerous challenges within a complex business setting. As a result, the organizations are required to review and adjust their organizational structure in order to handle the challenges and fulfill the needs of their customers. As Harris & Armenakis (2002) explain, since the organizational environment is faced with regular changes and the environment becomes progressively multifaceted, it becomes necessary to change the structure of an organization as well as adjust the components of the existing structure. Bergh & Kiing (2008) is in line with this and add that this forces managers to implement a variety of changes during transformation of their organizational structures. Therefore, it is important for management to ensure that the design of an organizational structure can withstand the needs of modern businesses. Weiner (2009) opines that changing the organizational structure is supposed to be followed carefully until the goal of organizational restructuring is achieved. There are various challenges that come with changing the organizational structure but Bergh & Kiing (2008) explain that managers are not supposed to ditch the process of organizational restructuring process until the targeted changes are implemented within an organization. Ludosław & Mierzejewski (2012) argue that the purpose for changing the structure of an organization should focus on the process. Consequently, individuals will be motivated to focus on the needs of customers and changes that occur ought to be followed through. To minimize problems that come with changes in organizational structure, a high level of employee involvement should be maintained throughout the process (Fullan, 2011). Additionally, employees should be given adequate time to allow them to function and experiment with the new organizational structure prior to giving stakeholders feedback for the final implementation of the changes (Zeffane & Morgan, 2010). Additionally, organizational leadership should inform individuals about the purpose and reason for the new adopted structure. This means that the organizational management should stimulate efforts to achieve successful changes in the structure (Zeffane & Morgan, 2010). A change in organizational structure involves key organizational changes in regard to the way which the authority, capital, information as well as responsibility flows within an organization (Fullan, 2011). Basically, structural changes refer to changes that affect the structure of an organization that may result from both internal or external factors and basically impact operations in an organization. Examples of structural changes include change in the hierarchy and command, job structure, management systems or administrative procedures. Change in organization structure can result from company merger and acquisitions, duplication of duties, policy changes, market changes or changes in some of the organizational processes (Fullan, 2011). For instance, when two companies merge, there could be duplications of department as well as duplication of duties and hence some reassignment or elimination of some positions needs to be done. In addition, new policies and procedures require to be developed in order to fit within the new organizational structure (O'Connor & Fiol, 2006). Change in the organizational structure has a major impact on the entire organization. A study carried out by Samuel (2013) indicated that structural changes put strain not just on the organization as a whole, but also on each individual employee in the company. Actually, during implementation of structural change, employees are likely to experience stress and cynicism and this may have negative effect on the employee’s productivity due to decrease of organizational commitment, job satisfaction and even reduced motivation (Weiner, Lewis & Linnan, 2009). This is why for a successful change in structure of an organization; organizational employees ought to be intrinsically motivated for them to feel that they have control over the change process (Graan & Ukpere, 2012). Therefore, this indicates that change in organizational structure can result to reduced productivity of employees and eventually reduce the organizational productivity and profit margin. This is because as aforementioned, during the process of change implementation, employees may be skeptical regarding the change which could impact their motivation and generally their productivity (Graan & Ukpere, 2012). According to Diefenbach, (2006), implementing change in structure of an organization can also be faced with challenges like lack of adequate resources due to the high costs involved in implementing the change. For example, employees would need training on some aspects of the new implemented change and also it would be essential to train selected management on how to support individuals affected by the change (Graan & Ukpere, 2012). For example, when Vodafone UK proposed plans to reorganize it structure to improve customer service and respond to new market challenges, the management supported all the affected employees by management holding meeting with them using a collective consultation forum with employee representatives. Employees who were affected by the change were deployed and offered support (Graan & Ukpere, 2012). Generally, such efforts are obviously going to make the organization incur extra costs and sometime this can strain resources in an organization. According to Weiner, Lewis & Linnan (2009) in spite of need to change organizational structure in many organizations, there are many obstacles that exist. People and institutions may resist change in structure due to perceived threats to job security and management authority. In addition, internal and external rules also hinder change in organizational structure (Weiner, 2009). For instance, the staff system compartmentalizes job tasks using many classifications and discourages teamwork by constructing individual performance management system. Weiner (2009) also adds that regulations in organizations in some instances also discourage efficient cross-organizational work by enforcing restrictions, such as prohibiting organizations from sharing the financing joint efforts. Apelbaum et al (2008) explain that a change in structure of an organization needs a resolute leadership. This is because there are various challenges that come with change in organizational structure. An example of a problem that might arise when attempting to change organizational structure is resistance to the change. According to Sofat et al (2015), individuals are likely to resist change in an organization when they feel that the change might result to loss of power, prestige or loss or lowering of pay or organizational benefits. Accordingly, change in organizational structure may be perceived by organizational stakeholders including some employees as a change that will lead to loss in power, status or some other privileges such as organizational benefits (Zeffane & Morgan, 2010). The resistance to change whether it is rational or irrational can pose a serious challenge and obstacle to effective change in organizational structure. As Sofat et al (2015) further explain, organizational stakeholders are likely to resist change especially if they do not understand the envisioned objective of the change how the change is likely to affect them in future. Likewise, when employees and other stakeholders are aware of the impact of the intended change and they do not like the likely resulting effect, they are likely to resist such a change (Weiner, Lewis & Linnan, 2009). Resistance to change is also likely to be there when individuals feel that they will not be able to meet the demands of the intended change. Resistance to change may also occur when individuals who will be affected by the change may have a different opinion regarding the intended structural change; irrespective of the intended change being positive, they might assess the situation differently from the intended aim of the change (Sofat et al, 2015). Such reasons for resistance for any form of change may seem valid according to the personnel and other stakeholders who are likely to be affected by the intended change in organizational structure (Sofat et al, 2015). Therefore, it is fundamental for the organizational management to ensure that resistance to change is not ignored, but instead the reasons for the resistance should be diagnosed and strategies to for change acceptance designed. SHRM (2007) carried out a survey and established that resistance to change in organizations is among the major reasons why attempting changes in any organization fail. Actually, reactions to change in organizational structure can range from resisting compliance to failing to support the intended change. As per Weiner, Amick & Lee (2008) active resistance to the intended change is the most negative reaction that an organization can encounter while attempting to implement a change. For example, active resistance to change may involve sabotaging the change effort and actively objecting the intended structural changes, such as new procedures. For any intended change to be successful, it is important to overcome resistance by all the involve stakeholders especially the employees (Zeffane & Morgan, 2010). In case resistance to change is not effectively handled, this can result to time wastage and resources and eventually the organization will not be able to adapt to the changes. Studies show that when individuals resist organizational change, they are negatively affected emotionally, utilize sick and leave time often and have a higher likelihood of voluntarily leaving the organization (Weiner, Lewis & Linnan, 2009). The negative impacts of the proposed change can occur even when the intended change has enormous benefits. Change in organization structure may result to some organizational stakeholders losing authority and this may in turn lead to change resistance. As per Zeffane & Morgan (2010), perceived loss of authority or power can cause structural change resistance because people may feel that the intended change may finally render people of no influence in the organization. For instance, when an organization moves to a team-based organizational structure, supervisors may be turned into team leaders. In the former structure, supervisors may have had the authority to hire and fire those reporting to them. However, in the new team-based structure, all the power is given to the entire team. Rather than supervising and monitoring the progress the team makes towards achieving organizational goals, the team leaders are required to generally support and mentor the team an make sure that the team is able to effectively access all resources (Zeffane & Morgan, 2010). Owing to the ensuing loss of authority and power in the new structure, some supervisors can end up resisting the intended change however much positive impacts the change may bring to the organization (Zeffane & Morgan, 2010). According to DiFonzo & Bordia (2002) uncertainty regarding the change can also be a problem when attempting to implement structural change within an organization. For instance, when an organization merges with another one, staff and management might experience uncertainty regarding the effect of the merger on their department and the potential changes to their job role. Likewise, during organizational restructuring stakeholder may feel uncertain regarding the changing organizational priorities and the probable lay-offs (Hobman & Callan, 2004). This clearly shows that there are many issues that may make organizational stakeholders to feel uncertain. These uncertainties pose problem to implementation of the change. Management and change championsare often frustrated due to constant uncertainty among staff members (Hobman & Callan, 2004). DiFonzo & Bordia (2002) is in line with this and adds that the management might also be uncertain regarding structural organizational changes. This means that during structural change, most of the organizational stakeholders will be wondering regarding the effect of the change on the organizational structure, and particularly the impact on their job and roles (Fred, 2010). In a case formal communication fails to handle the uncertainties, informal channels like grapevine may greatly influence perception of employees regarding the change. Rumors involving the impact of propose change, for instance downgraded working conditions or lay-offs may become rampant and make the process of implementing the change very difficult (DiFonzo & Bordia, 2002). Conclusion Organizations constantly encounter many events and changes that require them to implement changes in organizational structure. Implementing the changes comes with diverse impacts which consist of challenges such as resistance to change and reduced productivity by the employees. Structural changes can create uncertainty among employees which can result to low motivation, high level of anxiety and frustration. This can in turn affect the employee’s productivity. Another challenge that can be encountered during change implementation includes resistance to change. Resistance to change can range from employee resistance to management resistance. This is because structural organizational change may come with lots of change that may involve some manager losing authority and power and hence even the management may resist change. On the other hand, employees may also resist change due to fear of change in functions or even fear of loss of job. The negative effects on employees of rumors and misinformation such as redundancy of some employees may have negative effects on employees and make them vehemently resist the change. Finally, implementing structural change in an organization may involve high costs and this can lead to strained organizational resources. This is because both employees and management need training on the change as well as the costs involved in implementing the change. All these problems may make it difficult to effectively implement structural organization change. References Apelbaum S, Mitraud A, Gailleur J, Iancovella M, Gerbasi R & Ivanova V, 2008, The Impact Of Organizational Change, Structure And Leadership On Employee Turnover: A Case Study, Journal of Business Case Studies, vol. 4, no. 1. Bergh D & Kiing L, 2008, Learning how to restructure: Absorptive capacity and improvisational views of restructuring actions and performance, Strateg Manag J, no, 29, pp. 593-616. Diefenbach, T, 2006, Competing Perceptions and Business Models of Senior Managers in a Higher Education Institution, International Journal of Knowledge, Culture and Change, vol. 1, no. 1. DiFonzo, N & Bordia, P, 2002, Corporate rumor activity, belief and accuracy, Public Relations Review, vol. 28, pp. 1–19. Fred L, 2010, Approaches to Managing Organizational Change, International Journal of Scholarly Academic Intellectual Diversity, vol. 12, no. 12. Fullan, M, 2011, Change leader: Learning to do what matters most, New York, NY: Wiley. Graan J & Ukpere W, 2012, Review an inclusive approach to structural transformation in organisational restructuring, African Journal of Business Management, vol. 6, no. 50, pp. 11916-11922. Harris S &Armenakis A 2002, Crafting a change message to create transformational readiness, Journal of Organizational Change Management,vol. 15, pp. 169-183. Hobman E & Callan V, 2004, Uncertainty During Organizational Change: Types, Consequences, And Management Strategies, Journal of Business and Psychology, Vol. 18, No. 4. Khan M & Hashim M, 2014, Organizational Change: Case Study of General Motors, ASEE 2014 Zone I Conference, April 3-5, 2014, University of Bridgeport, Bridgpeort, CT, USA. Krawford K, 2010, Change Management & Change Process (Case Study Analysis on an Organization), International Journal of Scholarly Academic Intellectual Diversity, vol. 12, no. 1. Ludosław D & Mierzejewski J, 2012, Shaping Knowledge for Creating Inter-Organizational Restructuring Processes of Management Systems of Quality and Manufacturing Organization, Studies & Proceedings of Polish Association for Knowledge Management, no. 61, 2012. O'Connor EJ & Fiol CM, 2006, Creating readiness and involvement, Physician Exec, vol. 32, no. 1, pp. 72-74. Sofat K, Kiran R & Kaushik S, 2015, Management of Organizational Change and its Impact on Commitment: A Study of Select Indian IT Companies, Global Business and Management Research: An International Journal, Vol. 7, No. 3. Samuel K, 2013, The Effects of Change Management in an Organisation: A Case Study of National University of Rwanda, Journal of Management & Business Studies, vol. 1, no. 1, pp. 1-18. Weiner BJ, Lewis MA & Linnan LA, 2009, Using organization theory to understand the determinants of effective implementation of worksite health promotion programs, Health Educ Res, 24: 292-305. Weiner B, 2009, A theory of organizational readiness for change, Implementation Science, vo. 4, no. 67. Weiner BJ, Amick H & Lee SY:, 2008, Conceptualization and measurement of organizational readiness for change: a review of the literature in health services research and other fields, Med Care Res Rev, vol. 1, no. 65, pp. 379-436. Zeffane R & Morgan D, 2010, Employee involvement, organizational change and trust in management, The International Journal of Human Resource Management, vol. 14, no. 1, pp. 55-75. Read More