Lesson 13: Managing Changes

Question 1

What is TDC’s Danish organsation in 2000

Answer 1

The structure between 1997 and 2000 was functional

The three functions were: Sales & Marketing, Product development and Networks & installations

The advantages were scale in handling customers, product development and operations

The disadvantages were cross section coordination, overload of top management and lack of visibility of financial value

Question 2

What was the TDC’s Dansih organsation in year 2001

Answer 2

The structure after 2000 was holding structure:

The subsidiary companies were fixed netowrk phone, mobile phone, internet and cable TV

The advantages were independence, visibility of values, easy to coordinate

Disadvantages were sub optimisation concerning product development and competition between subsidiairies concerning the same customers.

Question 3

What was the change process of TDC?

Answer 3

1) February - April
Report from Goldman & Sachs: proposing a holding structure

2) May - June
Invitation of McKinsey to manage some of the change process. Work in project around the new business areas

3) July - August
Appointment of new directs of futre subsidiaries (in secreted)
Project groups dissolved and new directors from their own proect teams
Announcement of the new structure on the 23rd of August

4) September - October
More detailed structuring of new companies and decision on staffing
Massive internal and external communication

5) November - December
Physical moving of employees and change of logo
Development of new systems and turn down of old ones

Question 4

What are the implications of and reflections over the change process?

Answer 4

The change took place rather fast and with little uncertainty:
High degree of top-down management

Tight management of time and deadlines

No dismiss of workers

A very tight control of information

Strategy follows structure:
Two reasons for change namely the creation of value, in teh stock market and the problem of overload of management

The new structure does not create competitve advantages by making the company uniqe

The new structure makes the firm uniform with other European competitors and made it more legitimate.

In this change strategy follows structure in order to decentralise

The lack of central coordination of strategy makes it difficult to draw lines between the business

Question 5

What are the things that didn’t go well with the change process?

Answer 5

A different perception between top management and project teams concerning the task

The dissolving of project teams and the take over of new groups appointed by the new directors did not happen smoothly.

Question 6

What happened subsequent after the changes?

Answer 6

TDC did not realise the value creation of the internet company because the stock market changed during the summer

TDC ran into doubled product development within the organisation

Two years later TDC Internet brought under TDC Landlines

Question 7

What are the elemnts in managing strategic changes?

Answer 7

1) Diagnosis
2) Leading and managing change
3) Levers for change
4) Managing change problems

Question 8

What are the types of strategic change?

Answer 8

Matrix with nature of change and extent of change

Types of change:

1) Realigment: changes within the paradigm
2) Transformative: change of paradigm
3) Incremental: small continuous changes
4) A big universal change

In the matrix:

1) Adaptation: small continuous changes within the paradigm
2) Reconstruction: Big and fast changes within the paradigm
3) Evoluation: gradual change of paradigm (change of strategy)
4) Revolution: big and fast change of paradigm (turn around)

Question 9

What are the implications of types of change?

Answer 9

1) Adaptation: participation and intervention
Decentralised over long time

2) Reconstruction: participation, intervention and direction
Centralised quite fast

3) Evolution: education, participation and intervention
Decentralised over long time

4) Revolution: direction and edict
Centralised quite fast

Question 10

What is the context of change?

Answer 10

Strategic change programmes:

Time, scope, preservation, diversity, capability, capacity, readiness, power

Question 11

What is the organisational cultural context?

Answer 11

Paradigm surrounded with: stories, symbols, power structures, structures, control systems, ritals/ routines

Possibilities and blockade towards change:
What part of the existing culture can be used to facilitate change

What part of the existing culture is on obstacle toward change?

How can these obstacles be defeated?

Question 12

What is a force cield analysis?

Answer 12

Pushing:
Hard work ethic that delivers results
Commitment of employees
Juggling priorities/potential flexibility
Forestry know-how
Encouragement/support of change from the top

Resisting: 
Traditional structure/ways of working
Bureaucracy
Departmental silos
Homogeneous workforce
Conservative/risk averse/slow to change
Command and control management style
Deference to senior staff
Past experience of change was that nothing really changed

Additional: 
Encouragement to work in new ways
Increased diversity of staff
Clear articulation of a vision for the future
Participation in the change process
Skill development

Question 13

What is a general model of change?

Answer 13

1) Unfreezing phase
Make clear that existing activities are not sufficient
Create a burning platform
Defeat resistance to change

2) Changing phase:
Make the changes (actions)
See to that they take place

3) Re-freezing phase
Tear down the earlier routines, systems and structures
Secure that it is not possible to return to earlier times

Formal change processes often follow a rational decision making process with elements of a learning process

Question 14

What are strategic leadership roles

Answer 14

1) Leadership in general
Envision the future strategy
Aligning the organsation to deliver the strategy
Embodying changes

2) Middle manager
Sense making of strategy
Reinterpretation and adjustment of strategy
Advisors to senior managers

3) Newcomers & outsiders
A new manager from outside
Consultants –> specific knowledge, legitimacy, often why managers hire them
Other stakeholders: new owners

Question 15

What are the styles of strategic leadership?

Answer 15

1) Theory E: Economic approach
The pursuit of economic value
Top-down
Hard levers of change
Emphasis on changes of structures and systems
Financial incentives
Portfolio changes
Downsizing

2) Theory O: organsational approach
The development of organsational capability
Emphasis on cultural change
Learning
Participation in change prgrams and experimentation

Question 16

What are the styles of managing changes?

Answer 16

More than one style can be applied through the change process: for instance a different style for each phase of the change process

Participation and aducation often take place in incremental changes and are often applied in professional bureaucracies and in adhocracies

Direction and edict are often applied in critical situations in machine bureaucracies, in divisional forms and in simple structures

Question 17

What are structures and control systems

Answer 17

Implementation of new strategies often involves change in economic systems and organsational design

These types of changes are often part of the re-freezing phase.

Change of systems and structures are not always enough

Therefore strategic changes must sometimes be followed by change of organsational routines, rituals, sumbols and power structures.

Question 18

What are organsational routines?

Answer 18

Refer to the way to do things

Routines are most of the time taken for granted

Routines can sometimes block for a readiness to listen to new ideas, iniatives and perceptions

There is a risk that new strategies are not implemented unless the existing routines are changed

New strategies must be followed on everyday activities

Question 19

What types of organsational routines

Answer 19

1) Rites of passages
Signify a change of status or role
Eg. Induction to new roles, training programmes

2) Rites of enhancement
Recognise effort benefiting organsiation
Similarly motivate other
Eg. Awards ceremonies, promotions

3) Rites of renewal:
Reassure that something is being done, focus attention on issues
Eg. Appointment of consultant, project teams and workshops

4) Rites of integration
= encourage shared commitment, reassert rightness of norms.
Eg. Celebrations of achievement or new ways of doing things

5) Rites of conflict reduction:
= reduce conflict and aggression
Eg. Negotiating committees

6) Rites of challenge
= throwing down the gauntlet:
Eg. New CEO setting challenging goals

Question 20

What are symbolic processes?

Answer 20

Symbols are objects, events and people that have a larger content of meaning than its immediate presentation suggests.

Strategic changes are not always visible for the ordinary employee

Symbols for change of the organisation can be:
Change of ritual concerning promotion, change of incentive systems, change of physical layout, change of logo, managerial behaviour (for instance expense), use of metaphors, use of new management language and concepts

Question 21

What is power and political processes

Answer 21

How do change agents handle resistance to change, when they do not have full control

1) Building the power base:
Control over budget, knowledge and people
Building legitimacy associated with elites
Building alliances and team building
Problem: takes time and can be perceived by others as a threat

2) Overcome resistance to change
Withdrawal of resources (budget, knowledge and staff)
Build your own legitimacy and degradation of other credibly
Create momentum for change and attacking counter-manouver
Problem: requires superior power and can be detructive

3) Gaining commitment
Deal resources for those who are on the change
Box change heroes
Collaborate with others and use reward
Problem: requires resources and takes time

Question 22

What are change tactics?

Answer 22

1) Timing:
The bigger the change the better to mobilise a crisis
An appointment of a new director and an acquisition create expectation of changes
Change agents must coordinate their signals
Act fast and avoid unnecessary anxiety

2) Cutback and lay off
It is best to implement lay off before the strategy process in order to reduce politicising the process
Do the lay off with an ethical responsibility

3) The importance of a fast success
Long run changes can benefit from small short successes which can maintain motivation