Leadership and Business Management Discussion Turning a failing organization around is one of the most interesting activities in management

Discussion of Key concepts
Forces of Change in the organization:

Internal forces for change in the organization

Informality and networking i.e Informal organization structure
Work Environment
Change in key personnel, top management perception.
Cultural Influences of the employees
Resource audit i.e. physical, financial, human and intangibles of the organization
Benchmarking
Analyzing core competence and value chain analysis and matching with the external environment

External Forces for change in the organization

Change in Market conditions, economic conditions
Political and legal environment
Societal and cultural environment
Technological environment
Competition
Industry changes
Demographic changes
Quality of Human resource
Globalization due to Market convergence, cost advantages.
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Organization structure and change

Organizational structure is the formal decision-making framework by which job tasks are divided, grouped, and coordinated. Organizational structure determines the role and responsibilities within the organization.
Purpose of organization structure
Organization structure is one of the key elements of the strategy implementation. Thus key objectives of it are:
• Building a capable organization
• Allocating ample resources to strategy-critical activities
• Establishing strategy supportive policies & procedures
• Instituting best practices & mechanisms for continuous improvement
Organizational structure depends on the product to be developed. Wheelwright and Clark define a continuum of organizational structures between two extremes, functional organizations and project organizations. Functional organizations are organized according to technological disciplines. Senior functional managers are responsible for allocating resources. The responsibility for the total product is not allocated to a single person. Coordination occurs through rules and procedures, detailed specifications, shared traditions among engineers and meetings (ad hoc and structured). Products that need a high level of specialized knowledge require a functionally organized structure.

Change management

Organizational change is a strategy implemented to accomplish organization's goals and objectives. Management who wants to implement change should expect strong resistance from some quarters in the organization. And "overcoming that resistance is a vital ingredient of any successful (Six Sigma project)." It is obvious that if proposed change is not accepted, the process will not succeed.

EIGHT STEPS TO Foster innovation:
1. Establish the objectives

2. Forming a powerful guiding coalition-Assembling a group with enough power to lead the effort.

3. Encouraging the group to work together as a team.

4. Creating a vision-Creating a vision to help guide the change effort

5. Communicating the vision-Using every vehicle possible to convey the vision to all people

6. Empowering others to act on the vision-Getting rid of obstacles to change like the structure..

7. Planning for and creating short term wins-Rewarding employees and recognizing them.

8. Consolidating improvements
(Model by Kotter)
http://leadertoleader.org/leaderbooks/l2l/fall98/kotter.html

Innovation and Change management initiatives need to go on. Changes in the culture of the organization take long but are necessary and must go on. Change doesn't arrive - it continues. 3M allocates 15 percent of a product engineer's time to "free thinking" and experimentation. A clear-cut process is in place for bringing new ideas to the surface.

McNamara (1999) states some measures to carry out successfully the organizational changes:
"The involvement of top brass in the organization, the board and the chief executive is a must in order to successfully implement change. Change should be carried out by the whole organization as a team and communications about it should be frequent and information should be disseminated to all. Sustained communications and education can calm resistance. In this approach, the leader discusses to the managers and staff why change has to be implemented. A venue should be opened to organization members to express their ideas, concerns and frustrations. To keep the change going, the organizational structure should tailor-fit to the change being implemented as well as its strategic plans, policies and procedures.
People who aged with the organization, in particular, will say that the traditional way of doing the business is tried and tested and will never understand the need for change. Sometimes consultants who are highly experienced in organization-wide change are hired to impress to people changes which need to be done. To quote from Bellanca (2000) "it is essential to ensure people that the change process is well planned, and that a variety of contingencies have been thought through."
Thus Organizations need to adapt to innovative techniques while avoiding the pitfall of adopting unproven methods and/or fads that may not fit with the culture of the organizations. Change cannot happen automatically. This is a very delicate issue. It requires three things:

* Management commitment,
* Universal approval, and
* Appropriate measures and rewards.

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Management Commitment:

In order for anything to happen in an enterprise, including change, executives and managers must be consistently committed to making it happen. Only enterprise leaders can ensure that resources necessary to effect the change are available. Consistent commitment means that the change becomes both an enterprise strategy and an enterprise goal that leaders continuously and obviously support. The visibility of leadership support is a primary factor in achieving universal approval for change.

Universal Approval:

Internal change is successful only when the people involved approve of the change. They understand the need for the change. They believe the change is good for the enterprise and good for them. They agree that the change being undertaken is the right change. Peter Senge, in his book The Fifth Discipline, describes the need for universal approval in order to implement systemic change.

"People want change, they don't want to be changed."

Measures and Rewards:

Getting everyone to want change is difficult. It requires a level and degree of communication and cooperation not found in most enterprises. Maintaining universal approval is even more difficult. The best way to get and maintain universal approval is to ensure that the process and results of change are measured appropriately and accurately and communicated enterprise-wide. Good results and changed behavior must be rewarded. At the same time, unchanged behavior and poor results should not be rewarded. Employees will not work toward change if they continue to be rewarded for old practices. Therefore the company needs to have above three things to manage the change.

References:
• Carter McNamara, (1999) "Basic Context for Organizational Change"; http://www.managementhelp.org/mgmnt/orgchange.htm
• Richard Bellanca, "Managing Six Sigma Change Resistance"; http://www.isixsigma.com/library/content/c031027a.asp
• Implementing Change; http://web.cba.neu.edu/~ewertheim/macro/change.htm
• Human resource management by Archana Gupta