subject: CHANGE MANAGEMENT IN SERVICE ORGANIZATIONS [print this page] CHANGE MANAGEMENT IN SERVICE ORGANIZATIONS
By Arshad Husain
Introduction
The dynamic business environment, increasing global competition, increased factor mobility especially that of human resources within and across national borders, rapid technological innovations and rapidly evolving product and services markets compel the organizations of today to be flexible in each and every respect of their structure and operations in strive for survival and growth. Under these conditions, there is only one constant for the organization, and that is change. The existing body of literature focuses mainly the reengineering and radical redesigning of processes in manufacturing organizations. Thisarticle seeks to examine and elaborate the management of structural and process change in service organizations where human psycho-social cognitive elements are important determinants of success of change interventions. With dominant role of human resources as the competitive weapon, service providers are increasingly facing problems in structural and process transitions for achieving and maintaining competitive advantage in the struggle of survival and growth. Thisarticle aims to present a model dealing with the management of change in service organizations using the change agents from strategic apex and techno staff by sequentially removing the physical and psychological barriers to change. The postulated relationships and model would serve to enhance the understanding of management theorists and practitioners in dealing with change and the management of change in dynamically evolving contemporary service organizations.
The recent growth of services sectors and services organizations in the developed and developing economies has brought them to the focus of management theorist and practitioners to judge the applicability of conventional organizational models in these new organizational settings. With dominant role of employees performance as a predictor of such firms' performance, this paper seeks to develop a model of organizational change, emphasizing the role of strategic apex in making intervention in the psycho-social cognitive elements of soft structure of organizations. The organization change refers to any alteration in the processes and structure of the organization, which results in the evolution and development of the organization, keeping in view its continuously changing environment. At the same time, it is even more about changing how people do the business, how they think and act, it is about changing part(s) of schemata and worldviews of people (Spencer, 2001).
Change should not be taken only as an operative refinement; rather it's a strategy to accomplish some overall goal. Usually organizational change is provoked by some major external drivers, e.g. increased competition, technological advancements, emerging markets, etc. Typically, organizations must undertake organization-wide changes to evolve to another sequential stage in their life cycle, e.g., going from a highly reactive, entrepreneurial venture to a more stable and planned development and ultimately towards being a perpetual institution. The organizational ecologists, thus, advocate that the success of an organization is dependent on its flexibility to cope to the changing environment and change itself in accordingly
Despite the wide body of research in the area, very few researchers have noted the importance of identifying organizational parameters prior to change. Cameron et al (1993) regard such parameters as "organizational readiness" for change. Depending on the existing culture and the degree to which a change (such as TQM) differs from that culture, an organization may be more or less ready for such a change. Tichy and Devanna (1986) discuss "creating a need for change and opening up the organizational culture to be receptive to the change. They indicate that this is especially difficult when there is no crisis, but rather the long-range vision of a leader is the basis of such change, who anticipates the implementation time of organizational change. At this point, the role of strategic apex i.e. top management team (TMT) is emphasized as decisive and most effective in making the change visible and viable. The objective of thisarticle is to develop a model of organizational change postulating the dominant role of TMT in creating need for change. The use of culture as tool as well as a target of such change is emphasized, which serves to reduce the negative impact of rigid culturally embedded processes of services organization on employees' behavioral resistance to organizational change.
Dimensions of change
Introduced as the only constant in the rapidly changing world of today, change has got many dimensions, characterized on the basis of magnitude, timing and scope of change.
Organization change versus Subsystems change
The Organization change refers to an overall change in organization on a broader level as compared to a subsystem change. The organization change might be seen where there is reorganization of the overall system e.g, downsizing and restructuring, while a subsystem change is smaller in scope, and is characterized by activities like introducing new production technology, or change in product attributes.
Transformational versus Incremental change
Transformational change is also known as radical redesigning, or reengineering, while incremental changes in the organizations are carried out on a smaller scale at a continuous basis in the organization.. (Carter, 1997) Continuous process improvement ensures that there is an ongoing culture of continuous incremental improvements throughout the processes of the organization, while transformational change refers to the complete makeover of systems.
Remedial versus Developmental change
Change undertaken in order to rectify a problem in the organization is known as remedial change while the effort of change which is undertaken to prevent any such problems is known as the developmental change. That is, if the organization undertakes preventive and developmental efforts, the need for remedial changes do notarise.
Planned versus Unplanned change
Planned Change is change resulting from a deliberate decision to alter the organization, while unplanned change is imposed on the organization and is often unforeseen e.g, retrenchment from export operations owing to a ban on exports of a certain commodity. The difference between planned change and unplanned change is of strategic back up. The unplanned change lacks prior strategic iteration, which makes its prospects of successful and efficient implementation questionable.
Change Management in Service Organizations
Service Organizations are such organization which are characterized by the non tangible nature of their offerings.
A service is an activity or a series of activities of more or less intangible nature that normally, but not necessarily take place in interactions between the customer and the service employee and/or physical resources or goods and/or systems of the service provider, which are provided as solutions to customer problems.'(Gronroos, et al, 1990)
Services do not have a physical dimension. When these are described using tangible nouns, it obscures the nature of the service which remains intangible.(Shostack, 1987)
The most important characteristic of services is that these are a function of human involvement throughout the delivery and consumption process. That is why the human resources are supposed to be the competitive weapons of the organizations. However, where there are human beings, there is always a resistance to change, an inertia which opposes the changes in the structure, processes and culture of the organizations, as people have an innate preference for stability and continuity.(Brooks, 1994)
According to Suddaby, Greenwood, 2005 "those resisting change adopt the mythology of moral tradition and choose words that evoke a value orientation and scenarios of change thatneglect the existing order of things".
