Forces for Organizational Change

Change is inevitable in the life of an individual or organisation. In today’s business world, most of the organisations are facing a dynamic and changing business environment. They should either change or die, there is no third alternative. Organisations that learn and cope with change will thrive and flourish and others who fail to do so will be wiped out. The major forces which make the changes not only desirable but inevitable are technological, economic, political, social, legal, international and labor market environments. Recent surveys of some major organisations around the world have shown that all successful organisations are continuously interacting with the environment and making changes in their structural design or philosophy or policies or strategies as the need be.

Forces for Organizational Change

There are a number of factors both internal and external which affect organisational functioning. Any change in these factors necessitates changes in an organisation. The more important factors are as follows:

1. External Forces for Organizational Change

External environment affects the organisations both directly and indirectly. The organisations do not have any control over the variables in such an environment. Accordingly, the organisation cannot change the environment but must change themselves to align with the environment. A few of these factors are:

  1. Technology: Technology is the major external force which calls for change. The adoption of new technology such as computers, telecommunication systems and flexible manufacturing operations have profound impact on the organisations that adopt them. The substitution of computer control for direct supervision, is resulting in wider spans of control for managers and flatter organisations. Sophisticated information technology is also making organisations more responsive. Both the organisations and their employees will have to become more adaptable. Many jobs will be reshaped. Individuals who do routine, specialized and narrow jobs will be replaced by workers who can perform multiple in decision making. Managements will have to increase their investment in training and education of the employees because employees skills are becoming obsolete more quickly. Japanese firms have progressed rapidly because they are very fast in adopting new technological innovations.
  2. Marketing Conditions: Marketing conditions are no more static. They are in the process of rapid change as the needs, desires and expectations of the customers change rapidly and frequently. Moreover, there is tough competition in the market as the market is flooded with new products and innovations everyday. New methods of advertising are used to influence the customers. Today the concept of consumerism has gained considerable importance and thus, the consumers are treated as the kings. Moreover, the competition today has some significant new twists. Most markets will soon be international because of decreasing transportation and communication costs and the increasing export orientation of business. The global economy will make sure that competitors are likely to come across the ocean as well as from across town. Successful organisations will be those who can change in response to the competition. Organisations that are not ready for these new sources of competition in the next decade may not exist for long.
  3. Social Changes: Social and cultural environment also suggest some changes that the organisations have to adjust for. There are a lot of social changes due to spread of education, knowledge and a lot of government efforts. Social equality e.g. equal opportunities to women, equal pay for equal work, has posed new challenges for the management. The management has to follow certain social norms in shaping its employment, marketing and other policies.
  4. Political Forces: Political environment within and outside the country have an important impact on business especially the transnational corporations. The interference of the government in business has increased tremendously in most of the countries. The corporate sector is regulated by a lot of laws and regulations. The organisations do not have any control over the political and legal forces, but they have to adapt to meet the pressure of these forces. In our country, the economic policy has liberalized the economy to a large extent. Many of the regulatory laws have been amended to reduce the interference of the Government in business. An organisation is also affected by the world politics. Some of the changes in the world politics which have affected business all over the world are e.g. the reunification of Germany, Iraq’s invasion of Kuwait, the break of Soviet Union etc.

2. Internal Forces for Organizational Change

Internal forces for organizational change are too many and it is very difficult to list them comprehensively. However, major internal causes are explained as follows:

  1. Nature of the Work Force: The nature of work force has changed over a passage of time. Different work values have been expressed by different generations. Workers who are in the age group of 50 plus value loyalty to their employers. Workers in their mid thirties to mid forties are loyal to themselves only. The youngest generation of workers is loyal to their careers. The profile of the workforce is also changing fast. The new generation of workers have better educational qualifications, they place greater emphasis on human values and question authority of managers. Then behavior has also become very complex and leading them towards organisational goals is a challenge for the managers. The employee turnover is also very high which again puts strain on the management. The work force is changing, with a rapid increase in the percentage of women employees, which in turn means, more dual career couples. Organisations have to modify transfer and promotion policies as well as make child care and elder care available, in order to respond to the needs of two career couple.
  2. Change in Managerial Personnel: Change in managerial personnel is another force which brings about change in organisation. Old managers are replaced by new managers which is necessitated because of promotion, retirement, transfer or dismissal. Each managers brings his own ideas and way of working in the organisation. The informal relationships change because of changes in managerial personnel. Sometimes, even though there is no change in personnel, but their attitudes change. As a result, the organisation has to change accordingly. Changes in the organisation are more fast when top executives change. Change in top executives will lead to important changes in the organisation in terms of organisation design, allocation of work to individuals, delegation of authority, installation of controls etc. All these changes will be necessitated because every top executive will have his own style and he will like to use his own ideas and philosophies.
  3. Deficiencies in Existing Management Structure: Sometimes changes are necessary because of some deficiencies in the existing organisational structurearrangement and processes. These deficiencies may be in the form of unmanageable span of management, larger number of managerial levels, lack of coordination among various departments, obstacles in communication, multiplicity of committees, lack of uniformity in policy decisions, lack of cooperation between line and staff and so on. However, the need for change in such cases goes un-recognised until some major crisis occurs.
  4. To Avoid Developing Inertia: In many cases, organisational changes take place just to avoid developing inertia or inflexibility. Conscious managers take into account this view that organisation should be dynamic because any single method is not the best tool of management every time. Thus, changes are incorporated so that the personnel develop liking for change and there is no unnecessary resistance when major changes in the organisation are brought about.