CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND
OF THE STUDY
Today’s
business environment produces change in the workplace more suddenly and
frequently than ever before. Mergers, acquisitions, new technology,
restructuring downsizing and economic meltdown are all factors that contribute
to a growing climate of uncertainty.
The
ability to adapt to changing work conditions is key for individual and
organizational survival. Change will be ever present and learning to manage and
lead change includes not only understanding human factors, but also skill to
manage and lead change effectively (Pettigrew and Whipp, 1991).
Change
is the inevitable. It is the only element of human phenomenal that is constant.
Organizational change occurs when a company makes a transition from its current
state to some desired future state. Managing organizational change is the
process of planning and implementing change in organizations in such a way as
to minimize employee resistance and cost to the organization, while also maximizing
the effectiveness of the change effort. Change is both inevitable and desirable
for any progressive organization (Fajana, 2002).
Today’s
business environment requires companies to undergo changes almost constantly if
they are to remain competitive. Factors such as globalization of markets and
rapidly evolving technology force businesses to respond in order to survive.
Such changes may be relatively minor as in the case of installing a new
software programme or quite major as in the case of refocusing an overall
marketing strategy.
Organizations
must change because their environments change, according to Thomas S. Bateman
and Carl P. Zeithaml in their book management: function and strategy. Today
businesses are bombarded by incredibly high rates of change from a frustrating
large number of sources. Inside pressures come from top managers and
lower-level employees who push for change. Outside pressures come from changes
in the legal, competitive, technological and economic environments
By
acceptance of organizational change, we mean the employees readiness and
willingness, support and commitment to the organizational ideals during the
periods of significant internal and external shifts in the organization’s
structure. Managers must not rush in introducing a change. The process must be
slow, steady and thorough (Fajana, 2002).
Acceptance
of change signifies the willingness of the affected parties to embrace and
function in a newly established order and their commitment to effect and
implement the changes. As underlined by scholars such as Pettigrew and Whipp
(1991), Fajana (2002) and Armstrong (2004), for planned change to bear its
desired outcomes, it must be introduced, implemented and managed in such a way
that attracts and gains the commitment from the affected parties to drive the
changes to achieve the desired goals and the existence of a common vision that
change for the organization is necessary and inevitable.
Conceptually,
the change process starts with an awareness of the need for change. An analysis
of this situation and the factors that have created it leads to a diagnosis of
their distinctive characteristics and an indication in which action needs to be
taken.
Change
signifies the willingness of the affected parties to embrace and function in a
newly established order and their commitment to effect and implement the
changes (Armstrong, 2004).
Effecting
change can also be painful. When planning change, there is a tendency for
people to think that it will be an entirely logical and linear process of
growing from point A to B, it is not like that at all. As described by
Pettigrew and Whipp (1991), the implementation of change is an interactive,
cumulative and reformulation in-use process. In order to manage change, it is
first necessary to understand the types of change and why people resist change.
It is important to bear in mind that while those wanting change need to be
constant about ends, they have to be flexible about means.
Bateman
and Zeithaml (1990), who identified four major areas of organizational change:
strategy, technology, structure and people. All the four areas are related and
companies often must institute changes in the other areas, when they attempt to
change one area. The first area, strategy changes can take place on a large scale-large
for example, when a company shifts its resources to enter a new line of
business or on a small scale for example, when a company makes productivity
improvements in order to reduce costs.
There
are three basic stages for a company making a strategic change: realizing that
the current strategy is no longer suitable for the company’s situation,
establishing a vision for the company’s future direction and implementing the
change and setting up new systems to support it.
Technological
changes are often introduced as components of larger strategic changes,
although they sometimes take place on their own. An important aspect of
changing technology is determining who in the organization will be threatened
by the change. To be successful, a technology change must be incorporated into
the company’s overall systems and a management structure must be created to
support it. Structural changes can also occur due to strategic changes as in
the case where a company decides to acquire another business and must integrate
it as well as due to operational changes or changes in managerial style. For
example, a company that wished to implement more participative decision making
might need to change its hierarchical structure.
People
changes can become necessary due to other changes, or sometimes companies
simply seek to change workers’ attitudes and behaviours in order to increase
their effectiveness. Attempting a strategic change, introducing a new
technology and other changes in the work environment may affect people’s attitudes
(sometimes in a negative way) (Bateman and Zeithaml, 1990). But management
frequently initiates programs with a conscious goal of directly and positively
changing the people themselves. In any case, people changes can be the most
difficult and important part of the overall change process. The science of
organization development was created to deal with changing people on the job
through techniques such as education and training, team building and career
planning .
Resistance
to change based on the existing theoretical and empirical study, the negative
evaluation of and resistance to change may occur on account of a number of
factors. Bateman and Zeithaml (1990) outlined a number of common reasons that
people tend to resist change. These include: inertia, or the tendency of people
to become comfortable with the status quo, timing, as when change efforts are
introduced at a time when workers are busy or have a bad relationship with
management, surprise, because people’s reflex is to resist when they must deal
with a sudden, radical change or peer pressure, which may cause a group to
resist due to anti-management feelings even if individual members do not oppose
the change. Resistance can also grow out of people’s perceptions of how the
change will affect them personally. They may resist because they fear that they
will lose their jobs or their status, because they do not understand the
purpose of the change, or simply because they have a different perspective on
the change than management.Making a solid case for the change is critical for
the change to have a lasting effect. The source of information about the change
must be credible. Stroh’s (2001-2002) study indicates that the participation of
employee leads to more positive relationships with the organization and thus
greater willingness to change, therefore the research intends to proffer an
evaluation of organizational change and its impact on staff productivity.
1.2 STATEMENT OF THE
PROBLEM
The
business environment produces change in the workplace more suddenly and
frequently than ever before. Mergers, acquisitions, new technology,
restructuring downsizing and economic meltdown are all factors that contribute
to a growing climate of uncertainty. Organizational ability to adapt to
changing work conditions is key for individual and organizational survival.
Change will be ever present and learning to manage and lead change includes not
only understanding human factors, but also skill to manage and lead change
effectively (Pettigrew and Whipp, 1991).
However
for change to produce its desired effect it must be accepted and embraced by
the organizational employees; but this is not often the case. Most changes
results in employee resistance of change in the organization thereby resulting
in poor morale and productivity
Therefore
the problem confronting this research is to proffer an evaluation of
organizational change and its impact on staff productivity with a case
appraisal of union bank plc.
1.3 RESEARCH QUESTIONS
1
What
is the nature of organizational change
2
What
is the process and methods of organizational change
3
What
constitute staff productivity
4
What
is the impact of change on staff productivity
5
What
is the impact of change on staff productivity in union Bank Plc
1.4 OBJECTIVES OF THE STUDY
1 To determine the nature of
organizational change
2 To determine the nature of staff
productivity
3 To determine the impact of change on
organizational productivity
4 To
determine the impact of change on staff productivity in union bank plc
1.5 SIGNIFICANCE OF THE STUDY
The
study shall proffer the essential factors necessary to effect change in the
organization. It shall determine the impact of change on organizational
productivity. The study shall provide significant information on managing
change to managers and organizations.
1.6 STATEMENT OF THE
HYPOTHESES
Hypothesis 1
Ho
Staff productivity in Union Bank is low
Hi
Staff productivity in Union Bank is high
Hypothesis 2
Ho
change is not accepted in Union Bank
Hi
change is accepted in Union Bank
Hypothesis 3
Ho
The impact of change on staff productivity in Union Bank is negative
Hi
The impact of change on staff productivity in Union Bank is positive
1.7 SCOPE OF THE STUDY
The study shall proffer an evaluation of
organizational change and its impact on staff productivity.
1.8 DEFINITION OF TERMS
ORGANISATIONAL
CHANGE: Organizational
change occurs when a company makes a transition from its current state to some
desired future state.
MANAGING CHANGE:
Managing
organizational change is the process of planning and implementing change in
organizations in such a way as to minimize employee resistance and cost to the
organization, while also maximizing the effectiveness of the change effort.
Change is both inevitable and desirable for any progressive organization
(Fajana, 2002).
Lewin’s model:
Considers that change involves a move from one static state via a state of
activity to another static status quo. Lewin specifically considers a three
stage process of managing change: unfreezing, changing and re-freezing. The
first stage involves creating a level of dissatisfaction with the status quo,
which creates conditions for change to be implemented. The second stage
requires organizing and mobilizing the resources required to bring about the
change. The third stage involves embedding the new ways of working into
organization.
Beer and colleagues: Advocate a model
that recognizes that change is more complex and therefore, requires a more
complex, albeit still uniform set of responses to ensure its effectiveness.
They prescribe a six-step process to achieve effective change. They concentrate
on task alignment, whereby employees’ roles, responsibilities and relationships
are seen as key to bring about situations that enforce changed ways of
thinking, attitudes and behaving. The stages are Armstrong (2004):
