UNIT 3

STRATEGIC CHANGE PROCESS

 Strategic change - Meaning
• When conducting strategic change, organizations plan and
implement changes to boost competitive advantage or achieve
another significant objective.
• For example, they may make changes to the business's policies,
structure or processes.
• Often, these changes serve as a response to market opportunities
or threats.
• The responsibility to guide strategic change typically falls to
upper management or executive staff members.
• Once leaders identify their desired goals or missions, they must
perform the change management process in a structured manner.
• The use of change management models, such as Kotter's 8-step
change model, can help organizations implement plans
thoughtfully.
 Steps of strategic change
1. Determine the need for change. When pursuing
strategic change, an organization must identify
what must change. ...
2. Perform a stakeholder analysis. ...
3. Build support for change. ...
4. Create a change network. ...
5. Prepare a change management plan. ...
6. Identify and manage obstacles. ...
7. Evaluate the change.
 Example 1

• A car manufacturer notices that its top competitor has

begun selling electric models.
• The company determines that to stay competitive, it
must also begin offering electric vehicles as consumer
interest in these models continue to grow.
• As a result, the organization designs and develops
electric vehicles and eventually launches them on the
market.
• To further differentiate itself, the company also begins
investing heavily in research and development
activities to lower the cost of its electric vehicles.
• The company hopes that by achieving this goal, it will
attract more consumers and outsell its competitors.
 Example 2
• A publisher that owns a newspaper realizes that the
industry is in decline.
• After collecting data, its leaders determine that most
people receive their news on the internet.
• As a result, they decide to shift to an online-only model
that requires users to buy subscriptions to read the
content.
• This shift requires structuring the organization's staffing
by selling its printing facility and laying off the employees
who worked there or delivered the physical paper.
• Eliminating the costs associated with the print product
enables the newspaper to continue its operations and
focus on its new online-only strategy.
 Hopson's change curve
• How to manage change and during transitions in a
persons life or in organization or in a team, how to cope
with problems, Adams, Hayes and Hopson change Curve
or this model created by them is very useful.
• They have chosen Self Esteem on Y axis and Time on X
axis.
• They analysed How much self esteem rises and falls, it
takes time to be comfortable with change.
• This helps to structure communication during change and
give you idea about how people, teams in organization
might behave during transitions.
 TRANSITION
Steps Exercise
1 Plot (on the curve) where were during that change

2 List the thoughts and feelings that came to mind

concerning the change?
3 Did you feel that the change was empowering or
disempowering?
4 What did it take to make you shift?
SHARE!
 Stage 1: Shock Reaction Comments

As rumours circulate,
individuals experience shock
1. There's nothing I can do.
and disbelief. Immobilisation
2. I cannot believe this
They do not want to do
is happening.
anything about the situation.
 Comments/Questions

1. What is it that I am not facing?

As the change become clearer,
2. What is the worst thing than
individuals try to tit in the change
can happen if I face this?
with their own personal position Minimisation
3. What is the worst thing that
and may try to believe that it will
can happen if I don't?
not affect them.
4. What am I assuming that makes
me turn away from this?
 AWARENESS
Stage 3: Awareness Reaction Comments/Questions

As reality begins to dawn staff may

feel alienated and angry, feelings of 1. This is unfair.
a lack of control of events overtake Depression 2. This should not be happening.
people and they feel depressed as 3. Why is this happening to me?
they try to reconcile what is
happening with their own personal
situation.
 ACCEPTANCE
Comments/Questions

1. I have to go along
with this.
2. I have to face this
The lowest point in self-esteem situation.
finally sees people starting to accept Letting go 3. Will I still have my job?
the inevitable. Fear of the future is a 4. What will happen to my
feature of this stage. position?
5. Will I receive training
where necessary?
 TESTING

Stage 5: Testing Reaction Comments/Questions

Individuals begin to interact

with the change, they start to ask
questions to see how they might
work with the change. 1. When will training
take place where
Exploration
necessary?
2. Who will support us
through
this change?
 SEARCHING

Stage 6: Searching Reaction Comments/Questions

Individuals begin to work with the 1. Things happen for a

change and see how they might reason.
be able to make the change work Search for meaning. 2. There's good that will
for them — self esteem begins to come out of this situation.
rise.
 INTEGRATION
Stage 7: I n t e g r a t i o n Reaction Comments

The change is understood and

adopted within the individual's own
understanding — they now know 1. This change has
how to work with it and feel a brought opportunities for
Internalisation
renewed sense of confidence and us.
2. Training has empowered us
self esteem.
to effect the changes.
 Virginia Satir’s Change Model
• The Virginia Satir’s Change Model Diagram is a visual
presentation of coping with unexpected events.
• This concept model by Virginia Satir, family therapist, is a
helpful mechanism for individuals to deal with changes.
• However, this change model is effectively applicable to
organizational changes.
• It has become valuable management tool for managers and
leaders working with various industries and projects.
• Because it assists in analyzing the impact of change and find a
solution for team as they go through difficulties.
• This model further enables the managers to re-evaluate the
process to achieve efficiency.
• The Virginia Satir’s change model is a 5 steps slope
diagram on graph. Following are the stages of Satir’s
change model:
– Old status quo: The things are going as planned and no
change necessary until client acknowledges it
– Resistance: Things which disrupt the comfort of old status
quo (Change happens)
– Chaos: The business can no longer produce results with old
methods
– Integration: Find solutions for desired results and apply the
most effective ones including new skills. (Transforming Idea)
– New status quo: Lastly, the stage where company enjoys
improved processes.
• There are two evaluation parameters on X and Y
axes i.e. Time and Performance.
• The diagram shows how chaos can bring down
performance and integration improves it with
time.
• The Virginia Satir’s Change Model PowerPoint
Diagram provides two slide layouts of 5 stages.
• These stages explain the effects of change on
thinking, performance, and physiology.
• Although each stage has different color and size to
differentiate from other segments, users can
customize them according to presentation.
Noer’s Redundancy Intervention model
 Level one: getting the implementation
process right
• Level one interventions are all about getting the process of change
right.
• In any change process there needs to be a good level of efficient
and effective management.
• This includes a communication strategy and a process that is in
line with organizational values.
• Noer suggests that once the decision is made to effect
redundancies, it needs to be done cleanly and with compassion.
• This requires open communication – ‘over communicating is better
than under-communicating’ – emotional honesty and authenticity.
• Although this is just level one it is hard to get this one absolutely
right!
 Level two: dealing with emotions
• Once you have attended to getting the task process right, the next
level is getting the emotional process right.
• This involves dealing with the disclosed and undisclosed feelings
mentioned above.
• Let us be frank: a lot of people are not very good at this.
• For many, allowing the release of emotions and negative thoughts
about the situation feels like they are opening a hornet’s nest.
• Managers need some support and a considerable amount of self-
awareness if they are to handle this well.
• There are many ways that managers can facilitate this process, with
either one-to-one meetings or team meetings.
• This level is about ‘allowing time for expressions of feelings about
situation plus implications for future and next steps for moving on’.
 Level three: focusing on the future
• The change curve indicates that a period of inner focus is followed by a period
of outward focus. Noer’s research suggests that once levels one and two have
been dealt with, the organization now needs to focus on those surviving the
redundancy. This is aimed at ‘recapturing’ their sense of self-control,
empowerment and self-esteem. In the same way that those who have been
made redundant need to go through a process of regaining their self-worth and
focusing on their strengths, those remaining need to do the same.
• There should be plenty of organizational imperatives for this to happen! But
once again, let it be a considered approach rather than haphazard. The
organization would not have gone through the changes that it has, without a
clear need to do so. It remains to those left to address that need – be it cost-
efficiency, productivity, culture change or merger. The more that individuals and
teams can be involved in shaping the organization’s future, the greater will be
the engagement and commitment, and the greater the chances of success.
Level four: embedding the changes
• Level four interventions occur at a whole-system level. One option – the laissez-
faire or reactive one – is to pretend that nothing much has changed. In terms of
Satir’s model, as described by Weinberg, the organization can fail to really address
or redress the situation. It could:
– try to reject foreign elements;
– try to accommodate foreign elements in its old model;
– try to transform the old model to receive foreign elements, but fail.
• Any of these options creates a scenario in which the changes are not sustainable.
Noer suggests embedding any changes made into the new way of working. This
includes:
– creating structural systems and processes that treat and/or prevent survivor syndrome
symptoms;
– redefining the psychological contract – being clear about what the new deal now is
between employer and employee;
– enacting and embodying the new culture and its values if that is one of the stated
objectives;
– ensuring all HR practices and management style are aligned with the espoused culture.
 Key lessons that Noer teaches us are:
• to address change on both the task and people level;
• to pay attention, not only to what individuals and
groups are going through now, but also the tasks
necessary to move the organization along; to use
these tasks to engage people as they come out of
the more negative aspects of the change curve;
• to take the opportunity of the turbulence of the
situation to embed into the organization those
structures, systems and processes that will be
necessary to sustain the changes in the longer term.
According to Noer D.M. (2009), there are four levels of
interventions taking place in case of an organizational redundancy
• At the level one of this model, the first and fundamental step of any
change process is getting the
• implementation process right. A good change process involves an
effective management system and
• a good communication strategy that is consistent with the
organizational values. Noer stressed the
• need of having open, honest, compassion, and authentic
communications throughout the process,
• especially when the decision on redundancy is made. However, very
often managers are prevented
• from being effective communicators by three control traps: managing
communication, managing
• emotions and managing unproductive image.
• After getting the process right, the next step is dealing with
emotions, both disclosed and
• undisclosed feelings. Many people do not feel comfortable
dealing with this second level. Managers
• will need lots of support either training or coaching in order
to handle this well. There are different
• ways to facilitate the emotion process. It can be dealt with at
individual face-to-face conversations
• or at team events. However, in times of organizational
trauma, grieving is most often seen as an
• expensive, time-wasting, touchy-feely distraction.
• Noer’s model suggests that after level one and
level two have been dealt with, the next level
is to focus on layoff survivors. Level three is
the process to help remaining people to regain
their sense of self-control, empowerment and
self-esteem; this is a similar process that used
for those who were made redundant.
• Level four interventions create the structural
systems and processes that immunize people
against survivor sickness. These new paradigm
systems changes can foster the individual acts of
courage necessary to break organizational co-
dependency. Level four interventions are chicken-
and-egg situations. It is hard to say which comes
first, the change in the system or the change in
the individual, because the two changes are
totally interdependent