The Nature Of Organisational Change

The Nature of Organisational Change

The Nature of Organisational Change Richard Seel This article offers a simple typology of different kinds of change. It was developed to help clients understand change in organisations and it helps to delineate the specific nature of organisational change as the most fundamental of these. It also offers some thoughts on the nature of organisational change.

Introduction I usually refer to myself as an organisational consultant; indeed, my masters degree is in organisational consultancy. But most people don’t know what that means (and nor did I until I started my MSc) so I often find myself trying to explain. Potential clients are not usually interested in abstract theory and the challenge is to find a reasonably accessible way of describing what I do. This article offers a typology of change in organisations, not as a theoretical abstraction, but as a way of helping people understand the nature of organisational change. The initial premise is that there are four kinds of change in organisations: ● Process change. ● System change. ● Structural change. ● Organisational change. In what follows I will say a little more about each—much more than I would expect to say to a potential client, but still being far from exhaustive.

Process change Processes are the ordered set of activities which are used to generate the outputs of an organisations. Michael Hammer and James Champney define a business process as, “a collection of activities that take one or more kinds of input and creates an output that is of value to the customer.” (1995:35) Hammer and Champney contrast the process way of thinking with a simple task focus, where each individual activity is viewed in isolation. Their work is thus a step towards a more holistic view of organisational life. Processes can cut right across structural boundaries such as departments, divisions or even firms; if the process can be managed and designed to operate as a seamless whole enormous efficiencies could follow. Business Process Re-engineering (BPR) was sold as a radical form of organisational transformation. By re-ordering the processes to a more natural customer-focused way the hope was that organisations would undergo a step change and move to new ways of working and being. The reality was usually different. This is not the place to discuss the strengths and weaknesses of BPR but the absence of any reference to people in the definition above is very significant. In fact, processes always involve interactions between people, usually on a one-to-one basis.

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The Nature of Organisational Change A better perspective on process comes, in my view, by considering the interactions between the people who actually interact with one another to deliver the process. Winograd & Flores’ notion of commitments (1986) is worth exploring further in this context.

Systems When most people in organisations speak of systems they are referring to sets of procedures. Increasingly these will be facilitated by networked computers; so much so that IT systems are now the first kind most managers will call to mind. But there are also HR systems: reward and recognition; recruitment and retention; appraisal and development; and so on. There are Health and Safety systems such as ‘permit to work’, payroll and finance systems, and so on. Many of these are codified into standards such as ISO 9000. Books on change in organisations often spend chapter after chapter advising on how to change systems but although useful and essential, changing systems is unlikely to bring about fundamental change. System change in organisations is often not systemic—that is it rarely takes account of the wider implications for the organisation as a whole. For instance I recently worked with an organisation which re-arranged its shift system for production workers from a six-shift to five-shift system. Production is continuous throughout the day and year and the new system requires fewer workers but means that each shift only spends one week in five on days. The same organisation also introduced a new ‘permit to work’ system (safety is crucial) which gave more responsibility to the production workers. Each change was made for good reasons but the effect of the two together is that maintenance workers are having to wait hours for their permits, they get frustrated and demotivated and the state of maintenance at the plant is poor. The temptation is to ‘fix’ one or other of the systems so that they gel together better. The chances are that this temptation should be resisted— unless we ask why this situation was allowed to occur, real change is unlikely.

Structures Structure is the outward form of organisation; an indication of the regularities which arise when groups of people get together in pursuit of a common purpose. Structures will inevitably emerge from the interactions between individuals—these people will usually work together; this one will usually adopt a leadership role; these will perform some functions, those will perform others; this group will have more status and power than that; and so on. Yet although structure will always emerge, in modern organisations it is usually imposed from ‘outside’. A conscious decision is made: perhaps to move from a hierarchy to a matrix; or from functional divisions to processfocused work teams.

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The Nature of Organisational Change Traditional ‘expert’ consultants are often very skilled at suggesting appropriate structures for different kinds of organisation in particular environments. Vast sums were expended (and often still are) in creating new structures. How often these projects deliver value for money must be questioned—indeed, it can be argued that one of their primary functions is to provide a mechanism to help managers deal with anxiety in organisational life (Hirschhorn & Barnett 1993).

Organisation Organisation is the most fundamental aspect of a business, charity, public service or any other goal-directed collection of people. My current working definition of an organisation is a co-creating pattern of relationships. The outward manifestation of organisation is what is often known as culture. I will just briefly look at the three key terms in the definition in a little more detail: Relationships The notion of relationship is core to this view of organisation, which owes much to the work of Maturana & Varela: Organization denotes those relations which must exist among the components of a system for it to be a member of a specific class. (1987:47) The relationships in human organisations are those which exist moment to moment between the people who are ‘members’ of the organisation and also between them and those who are in the ‘environment’ of the organisation. (I therefore do not see human organisations as autopoetic as I understand Maturana and Varela’s use of the term.) Pattern I use the word ‘pattern’ to indicate that although the way the networks of relationships occur is completely unpredictable at the micro level there are nevertheless some regularities and consistencies. The metaphor of the whirlpool may help here. From the point of view of an individual water molecule all is change and progress—it enters the whirlpool at a specific place (the source), moves from outside to inside in a way which is sometimes orderly and sometimes turbulent and finally exits into another relatively calm environment (the sink). Technically, the whirlpool is a chaotic system and it is not possible to predict the trajectory of an individual molecule. To the outside observer the whirlpool seems to present a relatively stable and recognisable pattern. Not only can we recognise a whirlpool if we see one but any particular whirlpool has features which persist over time (the Great Red Spot in Jupiter’s atmosphere is a good example). Co-creating It is crucial to recognise that the patterns of relationship which make up organisation are not designed or imposed from ‘above’ or ‘outside’; they are co-created by all the other conversations and interactions which are

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The Nature of Organisational Change occurring. Patterns may have a degree of stability but they too are both influenced and influencing in this continuous dance of change.

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The Nature of Organisational Change

Some Thoughts on Change

• Culture is created and sustained by the daily conversations, negotiations and commitments which take place between members of an organisation (and its stakeholders).

• Therefore, to change the culture, have different conversations. • But because culture is an emergent phenomenon it is patterned and this affects (co-creates) the pattern of conversational relationships.

• So it is not easy to change the conversations. You need new connections, diverse thinking, new ways of behaving.

• The organisation needs to start telling new stories (Denning 2001). • Change can be threatening—especially if organisational identity is threatened. • Identity is often vested in symbols and rituals (symbols such as modes of dress,

office layouts, job titles, salary structures and so on; rituals such as working practices, meal arrangements, and so on)

• Changing

the symbols and rituals may be essential for change but if done insensitively may feel like challenging identity.

• A strong and secure sense of organisational identity will enable change to be tested and accepted.

• Change

can also challenge existing power structures. Therefore it may be (sometimes unconsciously) blocked by those with power.

• Open acknowledgement of issues such as these can make the change process easier but are no guarantee of success.

• A clear

sense of the desired culture can be helpful. Ideally this should be generated by the organisation as a whole. (Get everyone to draw the culture they want, or describe in a series of metaphors or postulate a few key ‘unwritten rules’).

• The leadership of the organisation then have a particular role as guardians and promoters of the vision.

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The Nature of Organisational Change

• A key way in which they can do this is to tell and share empowering stories about the organisation’s strengths and its potential for the future.

• All leaders and change agents must see themselves as part of the organisation and not acting on it from the outside as in mechanical models

• It is also important to have some clear limits to what change is permissible. • Within these limits, and in pursuit of the vision, people should be encouraged and resourced to try new ways of working and relating (see my A Model of SelfOrganised Transformation).

• It should also be possible to gently challenge the limits themselves. They will evolve over time.

• Finally, and most importantly (and hardest of all) patience and faith in the process are required.

• An awareness of the Kübler-Ross change curve is useful because many change initiatives are stopped when they are at the bottom of the curve.

• ‘Emergent’ processes such as Open Space (Owen 1997), World Café (, Future

Search (Weisbord & Janoff 2000), Whole Scale Change Danemillar et al 2000) and so on are often best in encouraging emergent change.

• An Appreciative framework, if not a full-scale AI approach (Watkins & Mohr 2001), will normally get the best results.

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The Nature of Organisational Change Creating or managing change (From some correspondence with Larry Hirschhorn) Can we create a sustainable change? There seems to be a notion of intentionality about the framing of this question which no longer seems entirely appropriate to me. Let me try to explain where I currently am. It seems to me that the traditional OD perspectives are from outside the system. There is always some sense that the consultant or the management or even everybody in the organisation can *make* the organisation change into what they want it to be - the only trick is finding the right approach. Of course, generally speaking, organisations do not change in this way but that has not been fatal to this paradigm. Instead, accepting it without challenge, people (mainly consultants) have rushed around trying to find new tricks for making things happen. This turns out to be quite a lucrative pastime for consultants and psychologically satisfying for their clients so there seems little reason to challenge the paradigm. These approaches, however they are couched, usually take an external perspective, seeing the organisation as a thing to be operated upon. It is very hard to dispense with this view, which belongs to 19th century physics, and is mechanical in its approach. My own current view (it’s still in a state of flux—a nice oxymoron) is that we cannot make organisations do anything much. It is possible to destroy them (closure, bankruptcy, etc.) and to radically disrupt them (mergers & acquisitions, radical downsizing, etc.) but the effects of even these actions are quite unpredictable. If we want less violent change to occur it is necessary to admit a degree of impotence. Instead we must remember that organisations are open complex systems and try two complementary approaches: 1) Help the organisation to discover some clear goals for change to which most people can aspire. 2) Help the people in the organisation become better connected with more diversity of inputs and interactions. The second will help the organisation move closer to self-organised criticality; the first will help influence the direction of any emergences which occur. The actual changes will not be created by this process. Instead, we are looking to help the organisation be ready to change when the stimulus comes. In the critical state it only needs a small stimulus to lead to a major effect. Since all organisations are open systems—even Trappist monasteries—sooner or later the right trigger stimulus will come along and the change will occur. To paraphrase: ● Of the bad change process they will say, “The change was forced on us.” ● Of the good change process they will say, “We worked together to make the change.”

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The Nature of Organisational Change Of the great change process they will say, “The system changed itself.” Of course, this is all pretty speculative—the work on complexity is still a long way from modelling human systems; in particular it tends to be based on large assemblages of simple agents (Bak’s sandpiles, Kauffman’s Boolean networks, Holland’s genetic algorithms, etc.) whereas human organisations have complex systems as agents and these agents have intentionality, a quality which no-one had tried to model yet. Nevertheless, I believe that complexity approaches are giving us pointers which enable us to start thinking out of the box and offer some potentially interesting approaches to organisation consulting. ●

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The Nature of Organisational Change References Dannemiller, Kathleen et al 2000, Whole-Scale Change: Unleashing the Magic in Organizations, San Francisco: Berrett-Koehler. Denning, Stephen 2001, The Springboard: How Storytelling Ignites Action in KnowledgeEra Organizations, Boston: Butterworth-Heinemann. Hammer, Michael and Champney, James 1995, Reengineering the Corporation: A Manifesto for Business Revolution, revised edition, London: Nicholas Brealey. Hirschhorn, Larry and Barnett, Carole K. 1993, The Psychodynamics of Organizations, Philadelphia: Temple University Press. Kübler Ross, Elisabeth 1973, On Death and Dying: What the Dying Have to Teach Doctors, Nurses, Clergy, and Their Own Families, London: Tavistock. Maturana, Humberto and Varela, Francisco 1987, The Tree of Knowledge: The Biological Roots of Human Understanding, London: Shambala. Owen, Harrison 1997, Open Space Technology: A User’s Guide, San Francisco: BerrettKoehler. Seel, Richard 2000, “Complexity and Culture: New Perspectives on Organisational Change”, Organisations & People, Vol. 7 No. 2, pp. 2-9. (Also at http://www.newparadigm.co.uk/culture-complex.htm) Watkins, Jane Magruder and Mohr, Bernard J. 2001, Appreciative Inquiry: Change at the Speed of Imagination, San Francisco: Jossey-Bass. Weisbord, Marvin & Janoff, Sandra 2000, Future Search: An Action Guide to Finding Common Ground in Organizations & Communities, San Francisco: Berrett-Koehler. Winograd, Terry and Flores, Fernando 1986, Understanding Computers and Cognition: A New Foundation for Design, Norwood, NJ: Ablex.

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