Trifecta Theory of Change Management

Ricky Gordon. Trifecta Theory of Change Management. The three necessary factors that companies require to oversee effective change management, and how these factors are influenced by managerial roles. MAN1100 – 2017. Edith Cowan University. Introduction. Managing change is a necessity because external factors such as competition and technological advancement force firms to continually readapt to stay relevant and survive (Williams, McWilliams, & Lawrence , 2017). Change management refers to a method of transitioning individuals, teams and organisations by applying processes to better manage resources and operations which restructure a company (Thompson & Martin, 2010). Within the literature, there are three recurrent key factors that can have a strong impact on the management of change, namely communication, leadership and organisational culture. Within these factors, ultimately, it is the organisational culture which is least responsive to the manager’s own ability. This essay highlights the impact of the manager’s personal ability to oversee these three crucial factors and why it is essential for a company to be effective in these areas. Leadership: Why a company needs good leadership for organisational change. Firstly, a company requires good leadership to oversee change because an effective leader will reduce resistance by role modelling good behaviour and cultivate collective alignment to company objectives. Organisational leadership refers to the ability of an individual to influence those within a work environment (Nguyen, 2009). As a result, role-modelling behaviour includes, creating a vision, leading by example and facilitating an environment of psychological safety in which individuals can contribute (Belias & Koustelios, 2014). Effective leaders will also emphasise shared goals and collective interests to reduce an individual’s resistance to change. Through the emphasis of shared goals and collective interests, a leader can induce employees to feel emotionally connected to the organisation. Individuals who are more emotionally connected to the company and its objectives, show more willingness to aid in efforts which yield a positive outcome for successful transformation. A good example of a leader which managed resistance to change and oversaw effective transition is Qantas CEO Alan Joyce. Joyce turned a historic $2.8 billion loss in 2014 into a $900 million net profit position at the end of 2015. Joyce engendered trust by emphasising company prosperity to the remaining 28,000 employees which reduced backlash over the 5000 jobs that were cut. Although 5000 jobs were lost in the transformation program, Joyce’s calm and honest demeanour, and focus on the need for change reduced resistance within the workforce to enable the most successful overhaul in airliner history. Hence, a company requires a leader to manage resistance to change by facilitating collective alignment to change efforts and company objectives. Leadership: How a manager’s personal ability assists organisational change. A manager is required to establish stability by translating a leader’s behaviour and vision for change into action, to assist effective company change. (Hodges, 2016). Kotter (2008) furthers this distinction between manager and leader roles in a time of organisational change, by emphasising that a leader role models change, where a manager implements control in change procedures so the transition can be effective. A manager achieves control by planning (setting targets) and organising (delegating responsibility) to produce a level of stability required in a changing environment which can be unstable. The relationship between a leader’s vision and managerial control can be likened to a ship; a ship will have a destination, but it needs someone to control the rudders and steering to arrive on time. Conversely, this does not mean that a leader’s role is passive and a manager’s role is active because change must occur top down within the company structure. On the whole, a manager’s ability to assist a leader’s role in implementing transformation by establishing stability is an important factor for overseeing effective change within a company. Communication: Why a company needs good communication for organisational change. The second key factor is organisational communication, which refers to the transmission of information that forms collective understanding and support for action (Mills, 2009). A company needs to have a solid foundation of communication to oversee effective organisational change as it promotes organisational identification (Ruck & Welch, 2010). Organisational identification can be explained as an individual’s “commitment to the organisation, a sense of belonging to it, awareness of its changing environment and understanding of its evolving aims.” (Welch & Jackson, 2007). Frahm and Brown (2007) extend this point that communication not only facilitates an understanding of further changes, but it enhances receptivity to change and encourages knowledge generation. Consequently, without clear and well-planned communication, the reasons to implement organisational change becomes unclear and confusing, making those affected unreceptive and resistant to change. Thus, for a company to oversee effective change, communication is a factor that must be facilitated for understanding to be cultivated and resistance to be reduced. Communication: How a manager’s personal ability assists organisational change. It is important to understand however, that organisational communication is not a phenomenon which occurs on its own but rather requires managerial ability to facilitate. Effective communication is crucial for successful change and requires the ability of managers to engage employees to manage resistance (Ford, Ford, & D'Amelio, 2008). People resist organisational change because it requires a change in behaviour and disrupts the status quo. As depicted in Figure 1, a manager who effectively communicates in a time of change can enhance company performance by 29.2%. For communication to be effective in changing behaviour, it needs to be receiver orientated. Receiver orientated communication refers to information that encourages inclusiveness and participation by taking employees into consideration within the dialogue (Hallahan, Holtzhausen, Ruler, Verčič , & Sriramesh, 2007). By and large, when inclusion and participation are encouraged, this is what is known as consensus building, where collaboration is the key to build collective harmony. A manager therefore, not only builds consensus by angling communication to encompasses employees but also influences the buy in effect of employees by stimulating trust through clear communication. Figure SEQ Figure \* ARABIC 1 retrieved from: http://cwfl.usc.edu/assets/pdf/Employee%20engagement.pdf Organisational Culture: Why a company needs to have an effective organisational culture for successful change. Lastly, a company needs to have an organisational culture which allows for innovation and creativity because this is what facilitates effective company change (Mathew, 2007). An organisational culture is a set of beliefs and assumptions that people have about what their organisation values and expects from them. A culture centralised around innovation and creativity refers to a work environment which enables individuals to create and partake in ideas and behaviours which are new. Apple is a company that has a strong organisational culture of innovation which best details why it is so necessary for effective change management. In Figure 2, the Double S-Curve model represents the need for innovative action as it shows companies who manage transition by innovating follow the path of high performers while those failing to transition, experience a decline in growth. With Apple’s culture embedded in innovation, change and transition is a streamlined experience as illustrated by the constant progress of its iPhone products. Apples market capitalisation (shares X share price) grew from $95.5 billion at the time of first iPhone release in 2007, to over $750 billion at the time of the latest release in 2017 (Macrotrend, 2017). Although an effective organisational culture can mean success, a manager’s ability to amalgamate individual cultural contexts with that of a company’s in a time of change is limited. Figure 2 retrieved from: http://innovationfactory.ca/liftprogram/ Organisational Culture: How organisational culture is the least responsive factor to a manager’s personal ability. A manager can help to facilitate a culture of innovation to an extent by promoting freedom and inclusion, but is limited by the ability to control time and individual cultural contexts (Hayes, 2014; Keyton, 2011). A manager is limited because they “cannot create the interpretation of a ritual or control the acceptance of a norm” (Keyton, 2011, p. 160). It is because a person’s cultural context is an external factor which is cultivated from their genes and upbringing, not organisational values. If change is necessary because of diminishing resources or competitive rivalry for example, then time is crucial. This is problematic for managers because people need time to adapt to new practices (Michalak, 2010). The cultural context of a person will also predict how a person conceptualises and adapts to change, which Theron & Liebenberg (2015) refer to as the “relationship to resilience processes”. The propensity for resilience to change can be explained with using the uncertainty avoidance dimension in Hofstede’s cultural dimensions’ theory, which sheds a light on the nuances of cultural orientation. According to the Hofstede’s cultural dimensions’ theory, individuals with a high level of uncertainty avoidance are likely to “shy away from rendering action which alters their environment” (Ayoun & Moreob, 2008, p. 67) as they are more uncomfortable with ambiguity. Therefore, the individual’s cultural context can be less receptive to an organisational culture that promotes new behaviours because they are uncomfortable with situations that can alter their environment. As a result, a manager can be limited by individual cultural contexts to aid a company in implementing an organisational culture required for change, such as one entrenched in innovation. Conclusion. In conclusion, a company needs to have a good grasp on the factors mentioned above to oversee effective change management. Leadership is crucial for a company to manage resistance to change and cultivate emotional and collective alignment to the transforming objectives. Clear communication is required within an organisation to facilitate an understanding of the necessity for change. Organisational communication also promotes participation in the change effort by engendering trust and making personal and organisational benefits apparent. A manager’s ability to oversee these factors is all but limited to the facilitation of a new organisational culture. A manager can only motivate individuals whose cultural context will assimilate with a culture that is required for streamlining change. 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