Leading Change in Organization and Strategic Leadership by Executives

1. Leading Change in OrganizationandStrategic Leadership by Executives Session 11 31 December 2011 Civil Service College Dhaka Presentation by Dr. Muhammad G. Sarwar Email: sarwar_mg@yahoo.com Cell: 01821443741

2. Leadership: Course Outline

3. Contents of 10th Session: Managerial Work and Traits / Skills of Leadership • Management Processes • Activity Patterns and Role of Managers • Nature of Leadership Traits and Skills • Leadership Traits and Skills: research findings • Leadership Traits and Effectiveness • Leadership Skills and Effectiveness • Leadership Competencies • Situational Relevance of Leadership Skills • Theories of Traits and Skills: implications for Managers

4. 4 Primary Process in Managing

5. Taxonomy of Leadership Skill

6. Skills needed at different levels High CS IS skr TS Low LL Top

7. Contents of 11th Session: change in organization and role of executives • Change process in Organizations • Influencing Organization Culture • Implementing Change • How Leaders Influence Organizational Performance ? • Constraints on Executives • Conditions Affecting the Need for Strategic Leadership • Key Responsibilities for Top Executives

8. Change process in Organizations • Leading change is the most important and difficult leadership responsibility. It is the essence of leadership and everything else is secondary. • Effective leadership is needed to revitalize an organization and facilitate adaptation in a changing environment.

9. Change process in Organizations (contd.) • Resistance to change is a common phenomenon in any organization. Reasons for resistance to change are: • Lack of trust • Belief that change is not necessary • Belief that change is not feasible • Economic threats • High cost • Fear of personal failure • Loss of status and power • Threat to values and ideals • Resentment of interference

10. Stages in the Change Process • Lewin’s model proposed that the change process can be divided into 3 phases: • Unfreezing • Changing, and • Refreezing. According to Lewin’s model change may be achieved by two types of actions: • Increase the driving forces toward change; and • Reduce restraining forces that create resistance to change

11. Approaches of Organizational Change • Approaches of organizational change: • Attitude –centered approach involves changing attitudes and values with persuasive appeals, training programs, team-building activities, culture change program, etc. • Role-centered approach involves changing work roles by reorganizing workflow, redesigning jobs, modifying authority relationships, changing criteria for evaluation of work, changing reward system, etc. • Strategy-centered approach involves introduction of new products / services, entering new markets, initiation of internet sales, forming alliances with other organizations, modifying relationships with input suppliers, etc.

12. Approaches of Organizational Change (contd.) • Economic approach aims at improving financial performance with changes like downsizing, restructuring, adjustment in compensation and incentive package, etc. • Organizational approach seeks to improve human capacity, commitment, and creativity by increasing individual and organizational learning, strengthening cultural values, empowering people to initiate improvements.

13. Change in Organizational Culture • The culture of an organization is defined as shared underlying beliefs about the world and their place in it, human relationship, etc. • The underlying beliefs representing organizational culture are learned responses of problems of survival in the external environment and problems of internal integration. • A major function of culture is to help understand the environment and determine how to respond to it, thereby reducing confusion, uncertainty and anxiety.

14. Change in Organizational Culture(contd.) Ways to Influence Organizational Culture: • Leadership behavior • Promoting values and vision • Role modeling • Reaction to crises • Designing management system and programs • Setting criteria for rewards • Designing organizational structure and facilities • Symbols, rituals, ceremonies, etc.

15. Cultural Change and Stages of Growth • It is much more difficult to change culture in a mature organization than to create it in a new organization. • In a mature organization, culture influences leaders more than leaders influence culture. • Cultural assumptions are difficult to change when they justify the past and a matter of pride. • Thus, a drastic cultural change is unlikely unless a major crisis threatens the survival of the organization.

16. Implementing Organizational Change • Responsibilities for implementing change: • The role of the top management is critical in implementation of change in the organization. • The role of top management is to formulate an integrating vision and strategy for change and build a coalition of supporters, then guide and coordinate the process of implementation. • Debate over Pace and Sequencing of Change: • Rapid introduction of change throughout the organization to prevent the buildup of resistance; • A more gradual introduction of change to different parts of the organization at different times.

17. Guidelines for Leading Change • Create a sense of urgency about the need for change • Communicate a clear vision of benefits to be gained • Identify whose support is essential and any resistance • Build a broad coalition to support the change • Fill key positions with competent change agents • Use task forces to guide the implementation of changes • Empower competent people to help implement change • Prepare people for change by explaining how it will affect them • Help people deal with stress and difficulties of changes • Opportunities for early success to build confidence • Monitor progress of change and make necessary adjustments • Keep all stakeholders informed about the progress of change • Demonstrate continued optimism and commitment to change

18. Determinants of Organizational Performance • According to FLT (Flexible Leadership Theory) three primary determinants of organizational performance are: • Adaptation to the environment and innovation, • Efficiency and process reliability (maintaining cost effectiveness and ensuring quality), and • Human resources and relation.

19. How Leaders can Influence Organizational Performance? • Leaders can influence organizational performance determinants with a combination of methods: • Leadership behavior, • Modifying programs, systems and structure, • Formulating competitive strategy.

20. Constraints on Executives Executives faces various situational constraints toward influencing organizational performance: • Internal Constraints • Powerful inside coalitions, • Strong organizational culture and bureaucracy. • External Constraints • Nature of organization’s products/services and the type of markets in which the organization operates. • Existence of powerful external stakeholders such as a very few suppliers of raw materials, • Government regulations

21. Power Balance, Executive Tenure and Strategic Leadership • Power balance among different units of the organization also determines strategic leadership by the CEO. • A CEO’s strategic leadership is also affected by his/her duration in office.

22. Two Key Responsibilities of Top Executives • Monitoring the Environment, and • Developing Competitive strategy.

23. Monitoring the Environment Typical questions for environment scanning: • What do clients/customers want? • What is the reaction of clients/customers to the organization’s current products/services? • Who are the primary competitors? • What strategies competitors are pursuing? • How will the organization be affected by new regulations? • How will new technologies affect the organization’s products/services and operation? • How will the organization be affected by changes in the economy? • How will the organization be affected by international events? • How will the organization be affected by changing demography?

24. Guidelines for Environment Scanning • Identify relevant information to gather • Use multiple sources of relevant information • Analyze what clients/customers need and want • Gather intelligence about the products/services of competitors • Relate environmental information to stragic plans.

25. Guidelines for Formulating Strategy • Determine organization’s long-term objectives and priorities • Assess current strengths and weakness • Identify core competitors • Evaluate the need foe a major change in strategy • Identify promising strategies • Evaluate the likely outcomes of strategy • Involve other executives in selecting strategy.

26. References • Gary Yukl, 2011, Leadership in Organizations, 7th edition, Pearson, chapter 10 and 13 • Peter G. Northhouse, 2010, Leadership: Theory and Practice, 5th edition, Sage publication • Robert N. Lussier and Christopher F. Achua, 2007, Effective Leadership, 3rd edition, Cengage Learning.

27. Thanks