Change Dynamics

Culture,
Values and Change

Leadership and Change

Wednesday; January 31, 2007

Khurram Aziz
SBE – UMT, Pakistan
Session Plan

1. The impact of organizational

Culture and reshaping
capabilities on Change
implementation success: The
mediating role of readiness for
Change.

2. A new framework for managing

Change across Cultures.
3. If you want strategic Change,
don’t forget to Change your
Cultural artifacts.
4. Cultural Leadership in
organization.

SBE - UMT Culture and Change 2

Some basic Ideas

 Organizational Culture:
 Pattern of shared values and
norms that distinguishes one
organization from another.
 Indicate what is believed to be
important in the organization—
what is of value to
organizational members.
 Indicate how things are done in
the organization.
 Provide direction and meaning
for the organization’s
members.
 Energize organizational
members in the pursuit of
organizational purpose.
 Culture is organization’s
personality.
(as quoted in Higgins & Mcallaster, 2004)

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Some basic Ideas … cont.

 Change:

 Means several things.

Sometimes refers to the
external world of technology,
customers, competitors and
such like. Sometimes refers to
internal changes such as
practices, styles and
strategies.
(Senge, 2001)
 Change can also be the
change in shared assumptions,
values and practices of
organizational factors as they
are stimulated by changes in
the environment.
(as quoted in Higgins & Mcallaster, 2004)

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The Impact of Organizational Culture
and Reshaping Capabilities on
Change Implementation Success:
The Mediating Role of Readiness
for Change

Renae A. Jones, Nerina L. Jimmieson and

Andrew Griffiths, Journal of Management
Studies 42:2 March 2005
Rationale …. R u ready?

 While the failure of planned organizational change may

be due to many factors, few are so critical as employees’
attitudes towards the change event.
 Schein (1987, 1988, 1999) has addressed the failure of
organizational change programs by arguing that the
reason so many change efforts run into resistance or
outright failure is traceable to the organization’s inability
to effectively unfreeze and create readiness for change
before attempting a change induction.
 Organizations often move directly into change
implementation before the individual or the group to be
changed is psychologically ready.
 This attracted researchers attention.

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Readiness for Change

 Readiness for change is the

extent to which employees
hold positive views about the
need for organizational change
and the extent to which
employees believe that such
changes are likely to have
positive implications for
themselves and the wider
organization.

(Armenakis et al., 1993; Holt, 2002;

Miller et al., 1994).

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Theoretical Framework ……

Employee’s perception
of Human Relation
Values Culture

Employee’s
perception
Employee’s perception CHANGE
of Level
of Open System IMPLEMENTATION
Of
Values Culture SUCCESS
Readiness for
Change

Reshaping
Capabilities

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Theoretical Framework ……

Employee’s perception Employee’s

of Human Relation perception
Values Culture of Level
Of
Readiness for
Change
Employee’s perception
of Open System
Values Culture

CHANGE
IMPLEMENTATION
Reshaping SUCCESS
Capabilities

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Research Hypothesis …..

 Employees who perceive a human relations cultural

environment within their division would report higher levels of
user satisfaction and system usage and this relationship
would be mediated by their ratings of readiness for change
…. (H1a)
 Employees who perceive an open systems cultural
environment within their division would report higher levels of
user satisfaction and system usage and that this relationship
is mediated by their change readiness perceptions (H1b)
 Employees who report high levels of reshaping capabilities
within their divisions would also perceive heightened levels of
readiness for change which, in turn, would be predictive of
change implementation (H2)

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The Competing Values Framework

Flexibility
I Human Relations Open Systems E
N End – Cohesion and Morale End – Innovation and Development X
T Means - Training and Development, Means – Adaptability and Readiness, T
E Open Communication and Visionary Communications and E
R Participative Decision-Making. Adaptable Decision-Making R
N N
A Internal Processes Rational Goal A
L L
End – Stability and control End – Efficiency and Productivity
Means - Information management, Means - Goal-setting and planning,
precise communication and data- instructional communication and
based decision-making. centralized decision-making.

Control

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Reshaping Capabilities - I

 Leading organizations in the current and future global markets will be

those that can demonstrate timely responsiveness to effectively
coordinate and redeploy external and internal competencies (Teece and
Pisano, 1994)
 Penrose (1959); Teece (1982) and Wernerfelt (1984) acknowledged the
concept of organizations being flexible in manipulating current
capabilities and developing new ones.
 Recently, researchers have begun to focus on capabilities needed to
respond to shifts in the internal and external environment, more
concisely, the capabilities needed for change (Teece and Pisano, 1994).
 Capabilities required for successful change have been specifically
addressed by Teece and his colleagues who refer to these capabilities
as dynamic capabilities (Teece and Pisano, 1994; Teece et al., 1997).
Dynamic capabilities refer to the capacity to renew competences so as
to achieve congruence with the changing business environment.

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Reshaping Capabilities - II

 Turner and Crawford (1998)  Engagement is based on

discussed organizational informing and involving
capabilities needed for change.
organizational members in an
 Differentiated between operational attempt to encourage a sense of
capabilities and reshaping motivation and commitment to the
capabilities. goals and objectives of the
 Operational capabilities are required organization.
for sustaining everyday  Development involves developing
performance. Generally do not help
organization to manage change all resources and systems needed
effectively. to achieve the organization’s
future directions.
 The capabilities needed to achieve
change implementation success are  Performance Management
very different from those required involves proactively managing the
for current business performance. factors that drive the
 Proposed a taxonomy consisting of organization’s performance to
engagement, development, and ensure it consistently and
performance management effectively achieves the intended
capabilities. change.

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Measures ….

 Organizational Culture;  Reshaping Capabilities.

 Using Zammuto and Krakower  Ten items were developed for
(1991), Instruments asks use in the present study based
employees to indicate the on Turner and Crawford’s
extent to which their taxonomy of engagement,
organizations possesses development and performance
characteristics associated with management.
each of the four culture types.  Respondent’s were asked to
Along five dimensions. indicate the existing strength
 Dimensions include character, or weakness of each capability
leadership, cohesion, for their division on a five-point
emphases and rewards. scale, ranging from 1 to 5.

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Measures ….
 Readiness for Change:
 Measured with a 7 item scale
designed to assess the extent
to which employees were
feeling positive about the
changes.
 Scale was constructed ranging
from 1 (strongly disagree) to 7
(strongly agree).
 System Usage:
 Consisted of a single item.
 Responses were made on a 5-
point scale, ranging from 1
(never) to 5 (all the time).
SBE - UMT Leadership and Change
 User Satisfaction:
 Measured with the End-User-
Computing Satisfaction
Instrument (Doll and
Torkzadeh, 1988), consisting
34 item designed to measure
five aspects of user
satisfaction (i.e., accuracy,
content, user friendliness,
format and timeliness).
 Participants responded to
each item on a five-point
scale, ranging from 1 (almost
never) to 5 (almost always).
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Methodology

 State Government department  Outcome variables were

in Queensland Australia. assessed at Time 2 (T2),
 About to implement an end-ser approximately five weeks
computing system effecting all after collection of T1 data.
employees within the  Questionnaires posted to all
organization.
employees (N=572),
 Implementation strategy was response rate 27%.
incremental with three pilot
stages and a “roll-out” to all  Multi-item scales were used
employees. to ensure adequate
 Temporal study, predictors are measurement of each
measured at Time T1, just variable.
prior to implementation.  Reliability was ensured
using Cronbach’s alpha
coefficient.

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Research Results ….. H1b not supported

 Lack of support for Hypothesis 1b might be explained by a study conducted

by Cooper (1994) who examined the compatibility of different types of
information systems across the four culture types represented in the CVF.
 Suggested that implementation of information systems that are incompatible
with the cultural values of the organization will result in less than successful
change outcomes.
 Organizations with a strong open systems culture require information
systems that focus on the external environment and allow for the scanning
and filtering of opportunities that promote linkages across organizations.
 Organizational systems characterized by informal coordination and reduced
control also are key features of this type of organizational culture.
 These characteristics are somewhat inconsistent with the type of HRIS
implemented in the context of this study which was designed to apply
structure to internal communication processes.
 Employees with an open systems view of their organizational culture may
have felt that the new computing system was incompatible with the way in
which work was done in their division, thereby reducing the role that these
cultural values had on change readiness and the outcome variables of user
satisfaction and system usage.

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If You Want Strategic Change, Don’t
Forget to Change Your Cultural
Artifacts

James M. Higgins & Craig Mcallaster,

Journal of Change Management, Vol. 4, No.
1, 63–73, March 2004.
Overview
 Case study of Continental
Airlines and Owens and
Minor Inc.
 Less than 6 months,
converted 11th to 4th, from
loser into a profit makers.
($200M)1994to$556M1996.
 Gordon Bethune (CEO) and
Greg Brenneman (COO),
one of the best corporate
turnarounds.
 Superior Customer Service,
invest in people and value
them
SBE - UMT Leadership and Change
 Provided employees with a
sense of purpose, rewards
for success and improved
climate within which to
work.
 KSF – aligned major
strategy execution factors
(structure, systems and
processes) with new
strategy and ALSO aligned
relevant parts of
organizational culture (i.e.,
its value systems and
norms –Cultural Artifacts).
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Cultural Artifacts

 Once you change strategy, you must align

organizational culture with strategy, or face almost
certain strategic failure (Peters & Waterman, 1982).
 Set of attributes – objects and behaviors
differentiating one organization to other.
 Key values and norms.
 Myths and sagas.
 Language systems and metaphors.
 Symbols, rituals and ceremonies
 Use physical surroundings including interior design
and equipment.
 New cultural artifacts reinforced service as a key
value as opposed to the previous.

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 Cultural Artifacts (Shrivastava, 1985)

Key Values & Norms

ORGANIZATIONAL
CULTURE
Myths & Sagas

Language Systems & Metaphors

Symbols, Rituals & Ceremonies

ORGANIZATIONAL
CHANGE

Use of Physical Surroundings

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Alignment of Strategy with Cultural Artifacts -I

 Aligning Identifiable Systems & Norms with Strategy:

 High productivity, Pay-for-performance, delivery of bonus, valuing
customers through valuing employees, Face-to-face communication
explaining strategy, virtues of services and getting employee buy-in to
create that service.
 Changing core values in not recommended unless the organization’s
competitive environment forces a change in vision and mission.
 Myths and sagas
 Stories about key players and events in organizational history.
 Help shape attitudes of new and veteran employees.
 With new strategy, if required, change old myths and sagas to
emphasize new values and norms that are being stressed.
 HR Director torn out the most hated policy manual.

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Alignment of Strategy with Cultural Artifacts -II

 Language Systems and Metaphors.

 Organizations develop their own language for expressing who they are and
what they are about.
 Go Forward Plan – Business Plan (Did you know there are no rear view
mirrors on an airplane. The runway behind is irrelevant), Fly to Win –
Marketing Plan, Fund the Future – Financial Plan, Make reliability a reality –
product / service plan, Work together – people plan.
 From Worst to First – Company Slogan.
 Symbols, Rituals and Ceremonies.
 Demonstrate what is important to the organization (Lange, 1991)
 Company logo, flag, and slogans also convey the importance an
organization places on certain values, ideas or events.
 Meatball, Plane coloring, Seating, Re-carpeting, managers work altogether
on holidays.

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Alignment of Strategy with Cultural Artifacts-III

 Use of Physical surroundings including interior design and

equipment.
 Include plant and equipment
 Design and decoration convey important messages to those who
work in an organization., e.g., reveal values of organization.
 Gray-metal desks and open bays v/s wooden desk and closed
offices.
 Building with majestic exteriors or free flowing designs ma stimulate
more innovation than those that are dull and ordinary.
 Aligning cultural artifacts with a new strategy, even if it is
your organization’s first strategy, cannot guarantee strategic
success, but doing so takes an organization a long way
towards successful strategy execution.

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A New Framework For Managing
Change Across Cultures

Trompenaars, Fons and Woolliams, Peter,

Journal of Change Management, Vol. 3, 4, 361–
375 (2003)
Research Theme ……

 New paradigm for management of change is proposed.

 Existing frameworks tend to want to discard current
situation in favor of a new corporate culture, thus
discarding best of what already exists.
 Authors argue that changing an organization’s culture is a
contradiction in terms because cultures act to preserve
themselves and to protect their own living existence.
 So rather than seeing change as a ‘thing’ opposing
continuity, it is considered as a difference.
 Authors believe organizations seek change to preserve
the company, profitability, market share and core
competence.
 The reason for changing certain aspects is to avoid
changing in other respects.

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Research Theme ……

 Organizations must reconcile change with continuity in order

to preserve an evolving identity.
 New methodology is centered on diagnosing the tensions
between the current and ideal corporate culture.
 New approach for the management of change is to reconcile
emerging dilemmas.
 Change processes where leaders are not involved are like up-
hill skiing. It is possible, but one needs to be a very good
athlete.
 Authors demonstrated with examples and offered a new
conceptual framework on how seemingly opposing values
deriving from the tensions arising from change imperatives
can be integrated to achieve a ‘win-win’ outcome.

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Extreme Stereotypes of Corporate Culture

The Incubator The Guided Missile

-Person oriented
-Power of Individual
-Self-realization
-Commitment to one self
-Professional Recognition
-Task Orientation
-Power of knowledge/expertise
-Commitment to (tasks)
-Management by objectives
-Pay for performance.

The Family Culture The Eiffel Tower Culture

-Power Orientation -Role Orientation
-Personal Relationships -Power of Position/Role
-Entrepreneurial -Job Description/Evaluation
-Affinity/Trust -Rules and Procedures
-Power of Person -Order and Predictabiliy

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Top Six Ranked Tension Scenarios

Current Ideal Scenario

Guided Missile Incubator Scenario 1

Eiffel Tower Guided Missile Scenario 2

Family Guided Missile Scenario 3

Eiffel Tower Incubator Scenario 4

Family Incubator Scenario 5

Incubator Guided Missile Scenario 6

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Dilemmas – An Example

Current: Guided Missile Ideal: Incubator

Typical Dilemmas
Leadership Depersonalized authority v/s development of creative
individuals
Reconciliation Attribute highest authority to those managers who have
innovation and learning as prime criteria in their goals.
Management Consistent Goal-Oriented around Task v/s Power of
Learning
Reconciliation Make learning and innovation part of the task description.

Rewards Extrinsic reward job done versus intrinsic reward self-

development
Reconciliation Describe task in terms of clearly stated innovation outputs

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The Change Process

Envisioned
Future
Current Org.
Culture

Reconciliation
Process Core Values
Key Purpose

Leadership
Competence

Leadership
Competence
Reconciliation Business
Process Dilemmas

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New Methodology in Practice
1. Developing an envisioned
future in order to develop a
sense of what to go for.
2. Diagnosing the current
corporate culture with the
cross-cultural assessment
profiler (CCAP).
3. Defining core values and key
purpose to develop a sense of
what one stands for.
4. Defining the ideal corporate
culture with CCAP embedding
core values and key purpose.
SBE - UMT Leadership and Change
5. Defining major business
dilemmas caused by the
tensions between envisioned
future and key purpose and
between current and ideal
corporate cultures
6. Reconciling four or five major
business dilemmas
7. Diagnosing the current
leadership competence to
reconcile major value
dilemmas
8. Implementing new design and
defining concrete action points
to be taken as defined by the
change agents.
32
The Basic Dilemma Template
Current Value / Behavior that one intends to

10/1 Reconciled
Value/Behavior Value /
taken Behavior
too far

1/1o
Value/Behavior
taken
too far
keep

Ideal value/behavior that one needs to further develop

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Basic Pro-Forma Framework

On the one hand, we want moreOn the other hand, we need to

and/or keep the following valuesdevelop the following values and
and behaviour of our currentbehaviour for supporting our
organization envisioned future and core
values

1. 1.
2. 2.
3. 3.
4. 4.
5. 5.

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 Guided Template for action to be taken

I. In order to reconcile the first dilemma we need to be taking the following steps in
the following areas of:
The Market (think about what you could do in
areas of customers, time-to-market response,
flow of information from and to customers)
Human Resources (consider areas such as
management development, staff planning,
appraisal and rewards)
Business Systems (what can you do in areas of
IT systems, knowledge management,
manufacturing information, quality systems etc)
Structure and design (consider what could be
done in areas of the design of your organization,
both formally and informally, basic flows of
materials and information).
Strategy and Envisioned Future (review vision of
leaders, mission statements, goals, objectives,
business plans and the like)
Core Values (think about action points that
could enhance the clarity of values, how to
better translate them into behaviour and action
etc)

II. Who is taking action and carries responsibilityIII. How to monitor the change process
(consider for each of the possible action points(consider milestones and qualitative and
who is responsible for the outcome) quantitative measures of genuine change)

1. 1.
2. 2.

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Cultural Leadership in
Organizations

Harrison M. Trice; Janice M. Beyer,

Organization Science,
Vol. 2, No. 2 (May, 1991). Pp. 149-169.
Overview

 “….the unique and essential function of leadership

is the manipulation of culture.” (Schein, 1985).
 Part that leadership plays in organizational cultures
has not been systematically explored.
 Most applications of leadership theory focused on
how leaders influence the accomplishment of the
work of the organization (Daft 1983).
 The cultural approach to leadership reveals how
leaders influence the understandings and networks
of meanings that other hold and express through
their actions.

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Culture and Uncertainty

 Cultures never totally resolve uncertainties, merely

subjectively reduce them (Greertz 1973)
 People need some sense that they understand how the
world works in order to behave relatively confidently and
consistently within (Apter 1964).
 By providing this sense, cultures provide some degree of
order and continuity in social life (Moore and Meyerhoff
1977).
 Repeated communication and affirmation of the shared
understandings, through cultural myths, symbols, rites
(Trice and Beyer 1984), and rewards (Kerr and Slocum
1987) make cultures concrete and keep them vital.

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Links between Elements of Cultural Leadership
and Consequences for Culture.

Elements of Cultural Consequences

Leadership Innovation Maintenance
Drawn from Weber’s and
other conception of
1-Personal
Charisma Qualities
Self Confidence Confidence in group
Dominant Facilitator
Strong Convictions Strong Convictions
Evangelist Catalyst
Dramatic Persuasive

2-Perceived Situation Crisis No crisis, or a manageable

one

3-Vision & Mission Radical Ideology Conservative Ideology

4- Follower Extraordinary qualities to Leader represent existing

Attributions manage needed to deal values that were
the crisis. successful in past.

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Links between Elements of Cultural Leadership
and Consequences for Culture.

Elements of Cultural Consequences

Leadership Innovation Maintenance

5-Leader Behavior Effective role model. Effective role model.

Creates impression of Creates impression of
success and competence. success and competence.
Articulate Ideology Articulate Ideology
Communicates high Communicates high
expectations, confidence expectations, confidence
in followers. in followers.
Motivates Motivates

6-Performace Repeated success in Continuation of success.

managing crisis

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Links between Elements of Cultural Leadership
and Consequences for Culture.

Elements of Cultural Consequences

Leadership Innovation Maintenance

7-Administrative New structure and Refurbish and strengthen

Actions strategies, or innovative existing structures and
changes in structure and strategies, incremental
strategies changes in structure and
strategies.

8-Use of Cultural Communicate new cultural Affirms and celebrates

Forms ideologies and values existing cultural ideologies
and values.
9-Use of Tradition Establish new traditions Continues existing
traditions.

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Variants of Basic Types of Cultural Leadership

Innovation Maintenance
Variants Create Change Embody Integrate
Core To attract To displace To keep To reconcile
Organ’zatnal followers and elements of old existing culture diverse
Problem unite them. culture with new vital. interests of
ones. subcultures.

Possible Personal Personal Rites of renewalRites of conflict

Solutions Qualities Qualities reduction
Rites of Rites of
Integration degradation

Analog in Mgt Charismatic Transformation Inspirational Consensus

Literature al

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