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Chapter 10

Chapter 10. Innovation and Change. What Would You Do? Product Innovation at Kimberly-Clark. Procter & Gamble is determined to lead the market in diapers P&G responds aggressively to new innovations by Kimberly-Clark

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Chapter 10

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  1. Chapter 10 Innovation and Change

  2. What Would You Do?Product Innovation at Kimberly-Clark • Procter & Gamble is determined to lead the market in diapers • P&G responds aggressively to new innovations by Kimberly-Clark • Other products, such as toilet paper are perceived to have little room for innovation

  3. Learning ObjectivesOrganizational Innovation After discussing this section, you should be able to: • explain why innovation matters to companies. • discuss the different methods that managers can use to effectively manage innovation in their organizations.

  4. Why Innovation Matters Technology Cycles Innovation Streams

  5. 1900-1910 airplane, plastic, air conditioner 1911-1920 mammogram, zipper, sonar 1921-1930 talking movies, penicillin, jet engine 1931-1940 radar, helicopter, computer 1941-1950 atomic bomb, bikini, transistor 1951-1960 DNA, oral contraceptive, Tylenol 1961-1970 video recorder, handheld calculator, computer mouse 1971-1980 compact disc, gene splicing, laser printer 1981-1990 MS-DOS, space shuttle, CD-ROM 1991-2000 taxol, Pentium processor, Java 2001-Today mapping of human genome, first cloning of human embryo Blast From The PastTechnological Innovation in the 20th Century

  6. Discontinuity New Technology Performance C B A Effort Technology CycleS-curve pattern of innovation Adapted from Exhibit 10.1

  7. Technology Discontinuity (1) Technology Discontinuity (3) Variation Selection Variation Selection Era of Incremental Change (1) Era of Incremental Change (3) Era of Ferment (1) Era of Ferment (3) Dominant Design (3) Dominant Design (1) Technology Substitution (3) Innovation Streams Technology Substitution (2) Technology Discontinuity (2) Variation Selection Era of Incremental Change (2) Era of Ferment (2) Dominant Design (2) Adapted from Exhibit 10.3

  8. Managing Innovation Managing Sources of Innovation Managing Innovation During Discontinuous Change Managing Innovation During Incremental Change

  9. Managing Sources of Innovation • Creative work environments • workplace cultures in which workers perceive that new ideas are encouraged • Flow • the psychological state of effortlessness

  10. Organizational Encouragement Challenging Work Supervisory Encouragement Creative Work Environments Organizational Impediments Work Group Encouragement Freedom Components of Creative Work Environments Adapted from Exhibit 10.4

  11. Been There, Done That John Cleese on Innovations & Creativity • We need to have a positive attitudes towards mistakes • Fear of failure hurts creativity • Mistakes should be fixed, not concealed

  12. Managing Innovation During Discontinuous Change • Discontinuous Change • technology discontinuity creates a significant breakthrough • Use the experiential approach to innovation • innovation created by intuition, flexible options, and hands-on experience in an uncertain environment

  13. Experiential Approach to Innovation Design Iteration Testing Milestones Multifunctional Teams Powerful Leaders

  14. Managing Innovation during Incremental Change • Compression approach to innovation • assumes that innovation is a predictable process that can be planned in steps • Generational change • based on incremental improvements to a dominant technological design and achieving backward compatibility with older technology

  15. Compression Approach to Innovation Planning Supplier Involvement Shortening the Time of Individual Steps Overlapping Steps Multifunctional Teams

  16. Comparing Experiential and Compression Approaches • Experiential Approach • Highly uncertain environment • Goals: speed, significant improvements • Approach: build something new and significantly better • Design iterations • Testing • Milestones • Multifunctional teams • Powerful leaders • Compression Approach • Certain environment • Goals: speed, lower costs, incremental improvements • Approach: compress time and steps, small improvements • Planning • Supplier involvement • Shortening time of steps • Overlapping steps • Multifunctional Teams Approach Assumptions Steps Adapted from Exhibit 10.5

  17. Learning ObjectivesOrganizational Change • discuss why change occurs and why it matters. • discuss the different methods that managers can use to better manage changeas it occurs. After discussing this section, you should be able to:

  18. Change & Resistance Forces No Change Discontinuous Change Strong Resistance Forces Sporadic Change Continuous Change Weak Weak Strong Change Forces Adapted from Exhibit 10.6

  19. Inaction Stage Faulty Action Stage Crisis Stage Dissolution Stage Organizational Decline Blinded Stage

  20. Managing Change Managing Resistance to Change Change Tools and Techniques Managing Conversations to Promote Change What Not to Do When Leading Change

  21. Managing Resistance to Change • Lewin’s Framework • Methods of Managing Resistance to Change

  22. Lewin’s Change Process Unfreezing Change Intervention Refreezing • Share reasons • Empathize • Communicate • Benefits • Champion • Input • Timing • Security • Training • Pace • Top management support • Publicize success • Employee Services

  23. Methods of Managing Resistance to Change • Education & Communication • Participation • Negotiation • Top Management Support • Coercion

  24. Change Tools and Techniques Results-Driven Change General Electric Workout Transition Management Team Organizational Development Change Agent

  25. Results-Driven Change • Creates quick change by focusing on measurement and improvement of results • create measurable, short-term goals • use action steps likely to improve performance • importance of immediate improvements • consultants and staffers help managers • test actions steps to see if yield improvements • few resources required to get change started

  26. General Electric Three Day Workout • Boss sets agenda and identifies targets, then leaves • Outside facilitator works with sub-groups, who debate solutions • “Town Meeting” on day three • subgroups make suggestions • boss must decide on the spot

  27. Transition Management Team (TMT) • A team of employees whose full-time job is managing change • Anticipate and manage employee reactions to change • Top management determines change initiatives • TMT accomplishes those initiatives

  28. Organizational Development (OD) • A philosophy and collection of planned change interventions • Designed to ensure organizations long-term survival • Change Agent • the person formally charged with guiding a change effort • can be internal or external person

  29. General Steps for OD Interventions

  30. Large System Sociotechnical Systems Survey Feedback Small Group Team Building Unit Goal Setting Person-Focused Counseling/Coaching Training Types of OD Interventions

  31. What Really Works? Change the Work Setting or Change the People? Changing the Work Setting 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Probability of success 55% Changing the People 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Probability of success 57%

  32. What Really Works? (Cont’d.) Change the Work Setting or Change the People? Do Both! Changing Individual Behavior & Organizational Performance 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Probability of success 76%

  33. Managing Conversations to Initiate Change Conversations for Understanding: Generating Understanding Initiate Conversation: Starting a Change Potential Breakdown: Nothing Happens Potential Breakdown: Unclear Conditions of Satisfaction Potential Breakdown: Omitting Closure Conversations for Closure: Completing the Change Conversations for Performance: Getting into Action Potential Breakdown: Agreement Isn’t Action Lack of Rigor Adapted from Exhibit 10.13

  34. What Not to Do When Leading Change Unfreezing Change Refreezing • Not establishing a great enough sense of urgency • Not creating a powerful enough guiding coalition • Lacking a vision • Under-communicating the vision by a factor of ten • Not removing obstacles to the new vision • Not systematically planning for & creating short-term wins • Declaring victory too soon • Not anchoring the changes in the corporation’s culture

  35. What Really Happened?Product Innovation at Kimberly-Clark • Kimberly-Clark creates a stream of its own innovative ideas year after year • Developed Cottonelle Fresh Rollwipes, “premoistened” toilet paper • disperses or breaks apart in water • protected by 30 patents • Significantly improves technology behind existing personal care products

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