Change Management Concepts and Processes

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Concepts and

Change Management
in Power Distribution       5.1 INTRODUCTION

                        It is a common saying that change is the only constant in life. Reflect on your
                        own experiences. How have things changed around you − both in your social
                        life and your workplace? You will realise that the pace of changes has
                        increased manifold in the past few decades.

                        We are experiencing rapid changes in practically all spheres of our lives –
                        food, drinks, clothing, relationships, ambitions, living standard, work, tools,
                        techniques, etc. In this unit, we focus on change at the workplace. Your own
                        workplace may have undergone many changes, particularly in the wake of
                        power distribution reforms. Our aim is to sensitise you to the ways of
                        managing change in your workplace.

                        Therefore, we begin this unit by explaining what change is, what factors drive
                        change and the different types of changes taking place in businesses. We also
                        describe some relevant models of change. Finally, we discuss various
                        strategies for bringing about change in a planned manner.

                        In the next unit, we explain how to manage the people’s responses to change
                        in an organisation, in particular, their resistance to change.

                            5.2 UNDERSTANDING CHANGE
                        The dictionary meaning of change as a noun is making or becoming different,
                        difference from previous state, substitution of one for another variation, etc.
                        Change as a verb means to undergo change, to make or become different.
                        Change essentially implies dissatisfaction with the old and urge for the new. It
                        may be perceived in two ways:

                        •    Change as continuous and intrinsic to an organisation: There are
                             changes in an organisation that are minute in nature but take place
                             continuously. An organisation may be perceived as being in a state of flux
                             (like the universe) and the elements of its systems and sub-systems
                             always undergo subtle changes (incremental changes).

                        •    Change as extrinsic and discontinuous: Organisations are perceived
                             as normally stable and change is perceived as disruptive, forcing
                             organisations to modify, restructure or reconfigure. Certain changes
                             occurring inside the organisation are very minute and their impact is hardly
                             felt. But a few changes are cataclysmic in nature, giving the organisation
                             barely any time to cope with them. These are almost like natural
                             calamities such as earthquake, cyclone, etc. in their impact. Some
                             organisations may handle changes in a creative manner or make drastic
                             changes in their strategy and direction to emerge out of this turbulence
                             whereas others may get lost in it.

8                       We have tried to summarise the understanding of change in Box 5.1.
                            Box 5.1: What is Change?                                       Change
                                                                                      Concepts and
  •   Change underlies a qualitatively different way of perceiving, thinking and        Processes
      behaving to improve over the past and existing practices.
  •   Change can be seen as continuous and intrinsic to an organisation or as
      extrinsic and discontinuous.

  •   Change can be patterned and predictable or complex and unpredictable.
  •   Change is dual or bipolar. Continuity without change leads to stagnation,
      frustration and boredom in individuals and ambiguity, conflict and
      degenerative pathology in individuals and organisations.
  •   Many a times, the rate of change is faster than our ability to comprehend and
      cope with it.

We are familiar with changes brought about by the twin phenomena of
liberalisation and globalisation in all walks of life. The banking sector has
adapted to the emerging scenario very fast. And the power sector is now
beginning to respond to these trends (Box 5.2).

                 Box 5.2: Turnaround of a State Electricity Board

 RS. 2,542-CRORE LOSS (the Board announces a net profit of Rs. 200 crore
 for 2005-2006).

 The state government split the Gujarat Electricity Board into four regional power
 generation companies, four regional power distribution companies, one
 transmission company and a parent company. GEB restructured loans worth
 Rs. 4,130 crore and brought down the interest rates from 9.51% to 8.6%. It
 liquidated accumulated losses of Rs. 2,542 crore and announced a net profit of
 Rs. 200 crore for 2005-2006 by managing to increase its revenues through strict
 supervision of power distribution.

5.2.1 Some Key Change Themes
The winds of change today bring with them the inklings of happenings
tomorrow, though many-a-times it is difficult to tell whether there are storms in
the offing or pleasant breezes to soothe our lives. Predicting future is indeed a
tricky business. However, we need to have a futuristic perspective to be able
to introduce constructive change in our businesses. We should also have
some broad understanding of what factors bring about change in a society.
Needless to say, in the present times, one such important factor is the
availability of high quality services/products at affordable costs any
place, any time. In fact, early providers are invariably the leaders and reap
benefits if they maintain customer satisfaction on these counts.
Change Management       Changes in businesses are being brought about by the following key concerns
in Power Distribution   (Fig. 5.1):

                        •   Customers’ demand to provide them with products and services as per
                            their requirements, in the shortest possible time and at their
                            convenience, i.e., at any time and at any place. There are many
                            examples of this kind of change, ranging from pocket calculators, mobile
                            phones to computers. Whereas in the 1960s, computers occupied big
                            buildings, the same capabilities are now available in laptop and palmtop
                            computers and indeed on some models of mobile telephones.

                        •   Growing customer awareness and their desire for associated intangible
                            benefits, e.g., peace of mind, a life free of hassles and tensions stemming
                            from the purchase of products and services. For example, a company
                            which provides prompt complaint grievance redress also provides the
                            customer some peace of mind, which is valued equally by him/her. (You
                            may like to recall Unit 3 of this course.) People don’t really buy goods and
                            services. They buy a value – something they value.

                        •   The enterprise providing the value is able to share economics with the
                            customer by using as little matter as possible in the preparation of the
                            goods or services. Today, the use of automation and materials technology
                            has reduced the amount of processing and actual material required for
                            providing goods and services. These are being produced more quickly
                            and cheaply, and with less final bulk and weight. All this competitive
                            advantage is encapsulated in the phrase ‘no matter’.

                            ‘No matter’ as a concept also includes the role of the disposable, though
                            we have to watch its impact on the environment. There are throwaway
                            razors, diapers, cameras, pens, etc. The idea of no matter also covers the
                            idea of the invisible purpose behind a sale. Perceiving it opens up
                            opportunities of lateral thinking and further beneficial change. It is all a
                            question of tangible products fulfilling intangible needs. Such ideas can
                            transform a business as these emphasise on the effectiveness of
                            outcomes in addition to the efficiency of inputs.

                        •   Mass customization implies providing the customer with precisely what
                            s/he requires – something that is non-standard, yet can be produced on
                            the standard line (which produces goods of standard size, weight or other
                            requirement). Technology now permits this – it requires just a change in
                            computerised instructions.

                        •   Improvement in quality and reduction in cost are important drivers of
                            change. For an organisation, productivity has meaning if people value its
                            products. And people support the product if they get value for their money.

                        •   Our concern for the environment has also driven change in the way we
Fig. 5.1: Key Change
                            conduct our business. In this context, power produced by renewable
          Themes            sources is certainly better than that produced by fossil or nuclear fuels.
                            However, switching over completely to these resources may not be
    possible in the near future. But the governments and power utilities the              Change
    world over are aware of these concerns and trying to switch over to              Management:
                                                                                     Concepts and
    cleaner technologies.
•   Invention and use of newer technologies has the biggest impact on
    business, industry and society in determining the pace and nature of
    change. We have mentioned here some factors and the changes likely to
    take place in future.

We would also like to provide you a glimpse of the changes expected in future
in the world of work.

5.2.2 A Glimpse into the Future
The world of work is being affected by the way in which technology and socio-
economic changes act together to create an information society: Here
information not only keeps us informed to an unparalleled degree, but also
actually tells inanimate things what to do! This drastically reduces the need for
human beings to mind machines and perform basic processes.

We are into the age of what is called the ‘shamrock organisation’. Such
organisations are employing three categories of workers:

•   core employees who constitute permanent staff, performing the central

•   contractors either as individuals or as companies who perform specialist
    functions; and

•   casual or part-time workers, who carry out seasonal or variable tasks.

At different times of their lives, people may find that different work styles suit
them better and switch over from one category to another. People may
actually have a portfolio of approaches to work from which they may invoke
the element which suits a particular part of their life cycle (Fig. 5.2). The
portfolio may include wage work, field work, home work, (domestic, do-it-
yourself, etc.), gift work (for charity or the community) and study work (self-
education). Thus, as the pattern of work changes, lifetime work for one
employer will become increasingly rare, and wider opportunities will emerge.

                       Fig. 5.2: Changes at the Work-place                                     11
Change Management       The implications of all this are vast both for the business and the individual. If
in Power Distribution   society can get it right, it may mean more leisure and freedom. It will also have
                        a bearing on the concept of career for life, which is also creating problems for
                        many companies where the career ladder has fewer rungs to climb.

                        In addition, the requirements for various kinds of work skills and capabilities
                        are undergoing a radical change. Now-a-days, the services sector has
                        become as important as the manufacturing sector. It requires more mental and
                        interpersonal than manual skills. Most of these brain workers will require
                        higher education, which enough of them are certainly not getting in most

                        As managers, you should be aware of the factors that are bringing about
                        change in your own business and should be able to cope with them. You will
                        also need to educate your workforce to appreciate the nature of these
                        changes for creating a better world of work and life. A proper understanding of
                        the changes in working methods and their impact on careers and employment
                        patterns can help people to be less anxious about the apparent insecurity
                        caused by changing technology, methods and external market forces.

                        If all employees could understand these trends and regard them as a
                        bandwagon to be jumped on rather than as a threat to be resisted, and if you
                        can help trade unions to see them as opportunities, the resistance to
                        beneficial change would be diminished to the advantage of all. Understanding
                        and anticipating changes in the offing will make it possible to introduce change
                        incrementally on a ‘win-win’ basis instead of by the process of conflict.

                        In the world of work, the need for a change mindset (which does not assume
                        the permanence of the status quo), and of a future mindset (which projects
                        itself into the future and sees new possibilities) is going to be vital. There are
                        revolutionary trends at work. It will not be wise to ignore them.

                         SAQ 1: The nature of change

                         Reflect upon the changes that have occurred in the past few years in your
                         organisation. Enlist the continuous and intrinsic changes amongst those.




                        The recent literature on change management reveals that organisations are
                        undergoing continuous and increasingly rapid and dramatic changes. We
                        need to understand the need to change in the wake of changes in external
                        environment like globalisation, and advancements in information technology
                        as well as inherent challenges in managing these changes. In this context, you
12                      need to learn about the forces of change.
5.2.3 Forces of Change                                                                         Change
Any factor in the environment (both internal and external) that interferes with           Concepts and
the organisation’s ability to attract human, financial and material resources it            Processes
needs, or to produce and market its services/products becomes a force of
change. There are numerous visible and invisible forces, which are constantly
affecting changes in organisations. Some of the important ones are described
in Table 5.1.

                        Table 5.1: Important Forces of Change

    Force of Change                           Description

    Technology          Tools, techniques, instruments, methods, procedures

    Workforce           Knowledge, skills, ambitions, expectations, needs

    Economy             Liberalisation, globalisation, privatisation, breaking
                        the barriers, resource imbalance

    Competition         Mergers, acquisitions, entry of new organisations,
                        new products, lowering prices, better services

    Social Trends       Nuclear families, working couples, late marriages, one
                        child norm

    Political Factors   Warring ideologies, new equations, transitory
                        relationships, coalition Governments, single
                        superpower, etc.

5.2.4 Types of Change

All changes are not similar in nature. Some changes keep on happening on
their own and some are planned. Three types of change (Fig. 5.3) may be

•      Evolution
•      Revolution
•      Planned change

These may briefly be described as follows:

•      Evolution is the kind of change that comes as a natural process, in small
       adjustments or shifts in response to emerging problems.

•      Revolution is the kind of change brought about by applying force on
       others to comply through coercion or suppression to resolve conflicts.
                                                                                     Fig. 5.3: Types of
•      Planned change takes place when efforts are made to make others feel                    Change
       the need for change, determine the ideal or desired situation and strive to
       achieve the ideal or desired state through planned actions.
Change Management       Social and behavioural scientists have advocated diverse approaches to
in Power Distribution   understand the change process and described the following four kinds of

                        A. Exceptional Change: A particular change is accepted as an exception if
                           there is otherwise no change in the ongoing aspects. The existing beliefs
                           are not changed but specific change is introduced separately, as an
                           exception. For example, introduction of flexi-time in one division of an
                           organisation could be termed as an exception if all other divisions continue
                           with the existing system.

                        B. Incremental Change: A gradual change which is not even felt initially by
                           those who experience it is said to be incremental change.
                           Computerisation in offices has been introduced as an incremental change
                           in most of the organisations.

                        C. Pendulum Change: Change from one extreme point of view to the
                           opposite is said to be pendulum change. The shift from open tendering
                           process to single tender on negotiation basis in a company is an example
                           of pendulum change.

                        D. Paradigm Change: When new information about an event, object,
                           behaviour, and image is integrated and leads to the emergence of a new
                           belief, the change is called paradigm change. A paradigm in simple words
                           may be understood as a cognitive model of how things are or a standard
                           for how things should be. A familiar example is change in the power sector
                           in perceiving electricity as a business and the notion of ‘profit centres’.

                         SAQ 2: Forces of change

                         Identify the forces of change in your organisation. Categorise the changes
                         that have occurred in the recent past in your organisation into the various
                         categories given in Sec. 5.2.4.








                        Change has also been explained as a continuum between two extremes
14                      (Fig. 5.4).
     No                    Desired                                  Constant         Management:
     Change                (Productive Change)                      Change           Concepts and

                          Fig. 5.4: Approaches to Change

The No Change Position indicates the zero condition of inertia – sticking to
traditional view, valuing the past conservative thinking that new is definitely
bad. Any change or deviation from the past is perceived as a threat – a threat
to beliefs, habits, preferences, norms and prevailing order. When performance
management system is being evolved, constantly sticking to the previous
method (where boss does it alone) becomes an example of the no change

The major benefits of this position are stability, less effort, comfort, less risk
but it also brings no growth, boredom, dissatisfaction, conformity and

Constant Change, at the other extreme, is a dynamic approach with
continuous focus on future. In this approach, new is taken as always good.
Any change is seen as positive; resistance is seen as bad and equated with
not moving with times and as an opposition to the norms, values and
progress. While implementing changes with this kind of an approach, not
much regard is given to the opinion of the affected people.

The Productive (pragmatic) Approach to Change lies between these two
extremes and focuses on the existing state (what is happening). Change is
seen as inevitable in this approach. The emphasis is on explaining the need
for change and making a conscious choice without having a fascination or
inertia for the past or a compulsion for rapid change.


The drivers of change in business may be classified as:

•    Market changes;
•    Technological changes; and
•    Organisational changes.

Let us discuss each one of these, in brief.

•    Market Changes

     In the era of economic liberalisation, market forces are destined to dictate
     the pace and nature of change. We observe competition for capturing the
     markets for both goods and services in all spheres by competing industries
     through joint ventures or subsidiaries. People’s expectations have
     undergone radical change. The companies that satisfy customers in terms
     of cost, service, and value for money forge ahead in the competition.
Change Management           Businesses may also have to face changes due to factors such as trade
in Power Distribution       barriers, raw material shortages, change in political regimes, prices
                            shooting up, etc.

                            While such changes are sure to improve quality and bring about customer
                            satisfaction, small businesses may be affected adversely. It seems that
                            even political will is succumbing to WTO led forces in developing countries
                            and this could be detrimental to national interests, in the long run.

                        •   Technological Changes

                            Technological changes can give rise to changes in the market and
                            influence specific happenings in a company. Introduction of new and
                            innovative technology is likely to lead to price advantage, quality pre-
                            eminence and diversification into new products. One can also go to
                            hitherto unexplored areas of the globe. However, the indigenous
                            knowledge / industry / products may get a hit and struggle for survival.

                        •   Organisational Changes

                            Organisational response to market changes can take the form of
                            downsizing for cutting costs through retrenchment and reduction in the
                            number of employees as well as in the levels of management. Technology
                            may also force new styles of governance which require different skills. The
                            number of operating sites may be reduced. People may find themselves
                            performing totally new functions. The only way to stay in business may be
                            a merger or to be the subject of takeover, friendly or hostile. With such
                            ownership changes, other market, technological and organisational
                            changes may follow.

                            You must be reading about such changes in national dailies; it has almost
                            become a rule in the technologically developed economies and is now not
                            an exception for developing countries. In the first quarter of the year 2007,
                            Indian business houses have acquired offshore companies and vice versa.
                            As such, this seems inevitable with little scope for escape but there is no
                            need to perceive it as a threat; it could also be looked upon as an
                            opportunity to compete and be a winner.

16                                            Fig. 5.5: Drivers of Change in Business
Some visible and not so visible factors may also compel a business                    Change
organisation to effect changes of various types. Other factors that bring        Management:
                                                                                 Concepts and
about change are increased competition, price cuts, technology, laws,
customer/user demand, etc. (Table 5.2).

                   Table 5.2: Factors that Drive Change

             Factors                                 Changes

 Reduced cost as a result of        Cost control efforts, workforce cut,
 competition                        contract employee, automation

 High workforce cost                Buying (importing) rather than
                                    manufacturing, outsourcing, workforce

 Cheaper imported products          Setting up manufacturing unit in other

 Obsolete product due to            Change products, materials, technology,
 technology change                  equipment

 Pollution Control Laws             Technology import/ product substitution,
                                    putting units in areas having lenient laws

 Change in choice of                Customer (market) research lined retailing
 consumers (semi-cooked
 food, electrical/electronic kits
 in place of fuel based

 Time constraint, ease in           Departmental stores in place of small
 shopping                           scattered stores

 Health awareness – Low             Healthy product substitutes
 cholesterol oils vs. traditional

 Time constraint                    Home delivery, internet/tele- shopping

SAQ 3: Drivers of change

Outline the changes in the power distribution sector brought about by the
three categories of drivers of change described in this section.



Change Management
in Power Distribution       5.4 THE PROCESS OF CHANGE
                        You have learnt so far that change is the process of moving from the current
                        state to the desired state (vision) of future (Fig. 5.6). Making a change involves
                        moving the work force in organisations and its work culture in line with the
                        strategies, structure, processes and systems to achieve the desired state

                            Existing                      Change                         Vision Desired
                            Situation                     (Transition)                   Situation

                                                   Fig. 5.6: The Process of Change

                        The existing situation signifies the prevailing status at a point of time of what
                        the organisations looks like. The desired situation is the status which one
                        desires to prevail; it is also called the vision. The vision of an organisation
                        helps in clarifying

                        •     What do we want to become?
                        •     How much needs to change?
                        •     What the organisation should look like when the change is completed?

                        The transition state may be delineated by ascertaining the activities and
                        processes necessary to transform the organisation from its current state to the
                        desired state. It is a road map for specifying the activities, crucial interventions
                        and events during the transition period. For making an organisation to change
                        from the existing state to the desired state, some ‘force’ has to be applied.

                        5.4.1 Successful Change – The Three Step Model
                        In the three-step model (Fig. 5.7), successful change in an organisation
                        follows three steps: Unfreezing, intervening and refreezing.

                            Unfreezing                       Intervening                      Refreezing

                                         Fig. 5.7: The Three Step Model for Successful Change

                        Let us discuss them, in brief.

                        1. Unfreezing

                              When a product, service or profit is in a deteriorating stage, maintaining a
                              ‘steady state’ is not possible in the face of rapid changes. Therefore,
                              change has to be introduced in a planned way to improve the status quo.
                              This is called de-freezing or unfreezing. It aims at changing the existing
                              equilibrium and creating motivation to change using mechanisms like
•   lack of confirmation or disconfirmation,                                       Management:
•   sharing one’s concerns and perceptions frankly,                                Concepts and
•   removing barriers of communications,
•   induction of guilt and anxiety and creation of threats by reducing
    psychological safety,
•   presentation of alternative scenarios, etc.

In case of any change, the effort is likely to be met with individual/collective
resistance, which must be overcome. Status quo is maintained when the
following two types of forces are in balance in an organisation (Fig. 5.8):

•   Driving forces, which prompt change and drive away from the status
    quo, and
•   Restraining forces, which hinder the movement.

                   Fig. 5.8: Driving and Restraining Forces

These competing forces should be identified for effecting change in an
organisation. While the driving forces ought to be intensified/added,
restraining forces should be removed / weakened. Moreover, both
strategies should be followed simultaneously.

This technique, called the force field analysis, is explained in Box 5.3.                    19
Change Management                                  Box 5.3: Force Field Analysis
in Power Distribution

                         1. Identify the problem, which you want to work on.

                         2. Define the problem clearly indicating the present situation.

                         3. Define the situation desired after the problem is solved.

                         4. Identify the forces working for the change, (i.e., driving forces) by way of
                            individual listing, brainstorming or such other means.

                         5. Identify and list forces likely to work against the desired change
                            (restraining forces). These forces can be related to human resource,
                            time, money, technology, customer requirements or any other internal or
                            external factors.

                         6. From the list of driving forces and restraining forces, prioritise the
                            forces and identify 3-4 most significant forces under both categories.

                         7.    Make a force field diagram showing both types of forces after
                               prioritization. The arrows should be proportional to their

                         8. Discuss and list possible action steps for reducing or eliminating the
                            effect of the restraining forces and for adding or increasing the effect of
                            the driving forces.

                         9. Determine the most effective steps under both the categories of forces
                            and decide on the ones to be implemented.

                         10. Examine the resources available for carrying out each step.

                         11. Develop a comprehensive action plan, sequence of activities and assign
                             responsibilities for implementation.

                         12. Implement the plan.

                         13. Evaluate.

                        2. Intervening

                              The steps to be taken for carrying out the desired change should be
                              planned considering all aspects: tasks, technology, structure and
                              human resources. Since any organisation is composed of these four
                              inter-related and interdependent components, the impact of the changes
                              should be anticipated and examined. New responses should be developed
                              by providing new information.

                        3. Refreezing

                              The change interventions start making the desired impact in due course of
                              time and need to be stabilised. Refreezing stabilises a change
                              intervention by balancing the forces which have created the desired
                              changes (driving forces) and those, which are inhibiting the changes
                              (restraining forces). For rapid and deep change, the forces applied should
20                            be strong, the direction should be clear and the force should be applied in
   the right direction. This stage helps in stabilising and integrating the                 Change
   changes. This is attained by integrating the new responses into persons             Management:
                                                                                       Concepts and
   and into significant ongoing relationships through reconfirmation.


In this section, we briefly describe the current models of change.

5.5.1 C.D.S. Model
This is a very simple three stage model and the three stages are:

1. assessment of the current state;
2. developing the desired state; and
3. formulating the strategy/plan to move the organisation (or system) from
   the current state to the desired state.

1. Assessment of Current State

   At this stage, efforts are made to explore, analyse and identify the
   problems and unused opportunities, understanding the causes and
   visualising the effects. For this, a climate has to be created where people
   share their opinions and experiences openly and the management is
   willing to admit the gaps, slippages, wastages and other problems.

   Normally, a long list is generated and it is essential to prioritise and identify
   ‘points of leverages’, i.e., problems, which have high priority.

2. Developing the Desired State (Preferred Scenario)

   At this stage, efforts are made to determine how the organisation or
   organisational unit, project or the programme would look like after making
   the changes. For preparing the scenario, alternative possibilities or
   preferred scenarios are developed by using techniques like brainstorming,
   fantasy or a variety of structured exercises. Efforts are made to encourage
   both conventional and non-conventional ideas.

   A few indicators or criteria are also developed to indicate the achievement
   of the desired state. These criteria would help in future to determine to
   what extent the desired scenario has been arrived at. The steps to be
   followed are listed below:

   •    Evaluate each of the scenario by using different methods and select
        the preferred scenario.

   •    Anticipate the difficulties likely to be experienced while deciding on the
        action steps to reach the desired scenario. Examine if appropriate
        steps can be taken and resources will be adequately available.

Change Management               Otherwise, examine the feasibility of implementation of the next
in Power Distribution           preference.

                           •    Re-work on the selected preferred scenario to make it more explicit
                                and inspiring.

                           •    Ensure the commitment for the change initiatives and resources, and
                                the commitment of the key persons in the organisation and outside.

                        3. Formulating the strategy/action plan to move the organisation from the
                           current state to the desired state.

                           These strategies/action plans deal with how the movement from the
                           existing to the desired state would be accomplished. Thus this stage would
                           indicate how the results would be accomplished. For this, a wide range of
                           alternative strategies to reach the new stage or preferred scenario would
                           be identified. Each of the alternative strategies would be evaluated and the
                           appropriate strategy would be selected which would help in achieving the
                           desired outcome. These strategies would next be translated in the form of
                           workable plans.

                        5.5.2 ADPI Model
                        This model consists of four stages (Fig. 5.9).

22                                                    Fig. 5.9: ADPI Model
1. Organisational Analysis                                                              Change
                                                                                   Concepts and
   This phase aims at developing an understanding about the organisation,
   its culture and readiness for change. Efforts are made to understand the
   tasks, structure, strategies, systems, procedures and management
   practices, morale, motivation and internal and external environment.
   Different research techniques, interviews, brainstorming and workshops
   are used.

2. Designing Change Intervention

   At this stage, the vision or the desired state of the organisation is
   prepared. Active involvement of top management and wide agreement on
   the interventions are essential.

   The key resource persons and other team members are identified and
   team building initiatives taken to ensure shared vision and commitment to
   change. The role of each member is clarified. A number of workshops,
   training sessions, meetings and presentations are usually held at this

3. Planning for the Change

   The objective of this stage is to plan for effecting the desired changes for
   achieving the vision. An action plan is prepared indicating the activities,
   responsibilities, time frame, counting huge measures and required

4. Implementation

   This is the most crucial stage. The action plan has to be implemented and
   the persons involved have to be educated and convinced about the gains.
   Extensive communication is required and high orders of leadership skills
   especially persuading skills are required. A number of presentations,
   meetings, workshops need to be held.

   The success depends on the internal resource persons or facilitators who
   would work in tandem with the change agent/consultant. It is difficult to get
   successful implementation without Project Management skills.

5.5.3 Action Research

A change process based on systematic collection and analysis of data is
called action research. In this approach, data is collected to diagnose the
problem and action steps are identified on the basis of the analysis of the
data. It is a five step process (Table 5.3).

Change Management                              Table 5.3: Steps in Action Research
in Power Distribution
                                      Step                                Description

                         Diagnosis                     Data collection about the problems, perceptions,
                                                       concerns and the expected changes from the
                                                       employees of the organisation. Questions,
                                                       interviews, secondary records and a variety of
                                                       techniques are used.

                         Analysis                      Data analysis to identify the problems, patterns
                                                       of behaviours, etc. Inferences are drawn and the
                                                       primary concerns, problem areas and
                                                       expectations identified.

                         Feedback                      The highlights of the analysis in terms of
                                                       concerns and problem areas are shared with the
                                                       employees, especially those from whom data
                                                       has been collected. With the help of
                                                       representatives of employees, the action plan for
                                                       bringing about needed change in specific areas
                                                       is decided upon.

                         Action                        The action plan is set in motion.

                         Evaluation                    An evaluation is carried out at the planned
                                                       intervals to know the extent to which
                                                       implementation has taken place and desired
                                                       changes have been arrived at. Necessary steps
                                                       may be taken for collection, modification or
                                                       further work.

                         5.6 PHASES OF PLANNED CHANGE

                        For attaining enduring results, change cannot be left to chance; rather planned
                        efforts have to be made. On the basis of various change models (Sec. 5.5),
                        we can formulate a general approach for carrying out planned change. It
                        consists of the following steps:

                        1. creating and communicating awareness;
                        2. feeling the need;
                        3. exploring the readiness;
                        4. intervening – managing the transition; and
                        5. evaluation and follow-up.

                        We now briefly describe these steps.
1. Creating and Communicating Awareness                                                 Change
   Creating ‘awareness’ about change is the first stage. In an organisation,       Concepts and
   awareness can be enhanced by reconsidering the goals, reformulating
   vision and mission statements, assessing the achievement. Consideration
   of future environmental scenarios, extrapolations and forecast is useful for
   enhancing awareness. Benchmarking and competitor intelligence are two
   other triggers for enhancing awareness.

   Awareness tends more often than not to create an imbalance and disturb
   the status quo. People respond in different ways to the situation.
   Awareness may lead to anxiety about creating future scenarios (e.g., likely
   gains and problems to be faced) and therefore generates energy in those
   who become aware.

   One such example is given in Box 5.4.

         Box 5.4: An Example of Creating and Communicating Awareness

    In BHEL, in 1983, an HR manager was trying to project the role of
    personnel functions in achieving the corporate objectives in the next
    five years year from 1985 to 1990. He realised that if the workforce
    strength and turnover/sales kept on increasing at the existing rate, then
    in 1990, the company would be in red only because of workforce
    strength. He got alarmed and made a series of presentations in different
    fora. After initial reaction, the top management also became aware and
    alarmed of the impending situation. This created planned efforts of
    workforce planning under the leadership of the HR Manager. The result
    was that with the workforce of 1983-84 (numbering 78,000), the turnover
    increased from Rs. 800 crores to 8000 crores in the period 1985-1990.

   A variety of strategies, such as publications in newsletters, workshops,
   quiz, sessions and presentations in management programmes may be
   used for enhancing awareness.

2. Feeling the Need

   Once the awareness spreads, the involved people start feeling the need
   for change in the organisation, particularly the need for elimination of
   unhealthy situations. They start thinking about ways and means to avoid
   such situations and about the consequences if no change is made. The
   feeling is intensified when the actual/projected results are not in line with

3. Exploring the Readiness

   In spite of the felt-need, it is essential to explore the readiness of the
   organisation to change. A process facilitator may call a meeting/workshop

Change Management           of senior people and on the basis of observations or the interaction; s/he
in Power Distribution       can get an idea of the readiness to change.

                            Resistance to change is likely to be high when

                            − too much fascination for the status quo is displayed,
                            − fear and apprehensions are strongly expressed,
                            − cases of failure are cited more than success stories, and
                            − resource scarcity is repeatedly presented.
                            An alternative approach to assess readiness is through workshops. This
                            approach is based on 15 indicators, which have been listed in Box 5.5 as a
                            checklist under three broad classes.

                                      Box 5.5: Checklist for Exploring Readiness for Change

                                                        General Considerations

                              •    Size of the organisation

                              •    Growth rate

                              •    Crisis (situation)

                              •    Macro-economic

                              •    OD history

                              •    Culture


                              •    Time commitment

                              •    Money

                              •    Access to people

                              •    Labour contract limitations

                              •    Structural flexibility

                                                            People Variables

                              •    Interpersonal skills

                              •    Management development

                              •    Flexibility at the top

                              •    Internal change agents

                        Source: J.W. Pfeifer and John E Jones, The 1978 Annual Handbook for Group Facilitators

                        This instrument/checklist can be served to a number of people in the
                        organisation, including the top management and the findings should be
discussed. This will give an idea about the readiness as well as the level of           Change
awareness towards some of the crucial pre-requisites. A few questions may          Management:
                                                                                   Concepts and
also be considered for examining various aspects for readiness for change
(Box 5.6).
                             Box 5.6: Questionnaire

   •   Commitment/support of the top management to desired changes.
   •   Sense of urgency in the top management.
   •   The perceived power of top management.
   •   Clarity of vision in top management.
   •   Shared vision – to what extent the vision is shared by stakeholders.
   •   Congruence of targeted change efforts with ongoing change efforts in
       the organisation.
   •   Decision making style and quickness.
   •   Hierarchy in organisation – flat and flexible is more conducive to
   •   Super-ordination – Willingness of Line Managers to sacrifice their
       personal interest for the good of organisation.
   •   Customer focus of the organisation.
   •   Monitoring of competitors by the management.
   •   Risk taking – the extent to which managers/employees are rewarded for
       taking risk.
   •   Innovativeness – the extent to which innovativeness is encouraged.
   •   Communication channel – both directions.
   •   History/experience of past change efforts.
   •   Trust level between employees and management.
   •   Availability of resource persons (change facilitators – internal/
   •   Cooperation/collaborative attitude.

4. Intervening – Managing the Transition

   This involves many steps such as the following:

   •   Preparing the Team: A team of internal resource persons is
       constituted for carrying out the interventions. Ideally, this is a multi-
       disciplinary team, which would make the interventions and help in its
       successful implementation. The internal resource persons should
       be skilled in Human Process facilitation and should have
       undergone intensive training programmes.

   •   Conducting the Activities: The interventions that have been planned
       need to be implemented. Employees’ resistance may need to be
Change Management              overcome (Unit 6). If the approach appears to be inadequate or
in Power Distribution          inappropriate, amendments need to be made. The experiences are to
                               be documented highlighting both process and content aspects.
                               Regular interaction with the committee/task force members and
                               Consultants is essential.

                           •   Mid Course Evaluation: Periodic evaluation is required for
                               ascertaining whether the interventions are bringing desired results. If
                               the trend is positive, a follow-up is required. Otherwise, it must be
                               examined whether interventions have been made as per the plan. If
                               planned interventions are not giving the desired results, the causes
                               must be examined and if needed, alternative interventions should be
                               designed and introduced.

                           Before making the interventions, the management/facilitators should be
                           clear about:

                           a) What changes are to be made?
                           b) What are the ensuring benefits for the organisation?
                           c) How will change affect the individuals who experience it?
                           d) What supports and tools are needed to manage transition?

                           While making interventions the involved persons face different types of
                           problems (see Unit 6). The evaluation of the emerging situation, feedback
                           amendments and enhanced communication, helps integration of the

                        5. Evaluation and Follow-up

                           The results of the change initiatives (the gap between the planned and
                           desired) should be measured periodically. For this, a befitting feedback
                           mechanism needs to be set up – to gather information by survey, focus
                           groups, interviews, etc. Usually, it has been found that even if encouraging
                           results are obtained in the beginning, with the passage of time, the
                           situation starts deteriorating. Managers can intervene by way of providing
                           support, appreciation and training, etc. Special meetings, celebrations,
                           support groups and certain types of reinforcements are needed for
                           sustaining and enhancing the results.

                         SAQ 4: Phases of planned change

                         Cite an organisational example (from the power sector) where massive and
                         successful change has occurred and discuss the phases of change in that


 5.7 STRATEGIES OF CHANGE                                                                         Management:
                                                                                                  Concepts and
Change has been a matter of great interest to the Sociologists and
Behavioural Scientists. A number of theories and models have been
postulated. These have been compiled in the literature as seven pure                       If we have good,
strategies of change. We discuss each of these strategies, in brief.                          warm inter-
                                                                                          personal relations,
1.   The Fellowship Strategy                                                              all other problems
                                                                                             will be minor.
     The assumption underlying this strategy seems to be, “If we have good,
     warm inter-personal relations, all other problems will be minor.”
     Emphasis is placed on getting to know one another and on developing
     friendships. Groups that use this model often sponsor discussions,
     dinners, parties and other social events that bring people together.

     The fellowship strategy places strong emphasis on treating everyone
                                                                                        Fig. 5.10: The Fellowship
     equally; this is often interpreted as treating everyone in the same way. All                  Strategy
     people must be accepted; no one is turned away. When the group is
     making decisions, all members are allowed to speak, and all opinions are
                                                                                               If all the really
     weighed equally. No fact, feeling, opinion, or theory is considered                     influential people
     inherently superior to any other. Arguments are few, because conflict                        agree that
     generally is suppressed and avoided.                                                    something should
                                                                                             be done, it will be
2.   The Political Strategy

     Political strategists tend to believe that “if all the really influential people
     agree that something should be done, it will be done”. They
     emphasise a power structure that usually includes not only formally
     recognised leaders but informal, unofficial leaders as well. Much of the
     work done under the political strategy is the result of the leaders’ informal

     The political strategy emphasises the identification and influence of people
     who seem most capable of taking and implementing decisions. It usually
                                                                                        Fig. 5.11: The Political
     focuses on those who are respected and have the largest constituency in
     a given area. One’s level of influence is based on one’s perceived power
     and ability to work with other influential people to reach goals that are
     valued by one’s constituency.                                                           Money can buy
                                                                                              anything or
                                                                                             any change we
3.   The Economic Strategy
     Economic strategists believe that “Money can buy anything or any
     change we want”. They emphasise the acquisition of or at the very least,
     influence over all forms of material goods, such as money, land, stocks,
     bonds, and any other tradable commodity. This strategy is widely used in
     the United States and the Western world and is used most often by large
     corporations and by the very rich.
                                                                                        Fig. 5.12: The Economic
     Inclusion in a group that espouses this approach usually is based on                          Strategy
     possession or control of marketable resources. Influence within the group
Change Management                   is based on perceived wealth. Most decisions are heavily, if not
in Power Distribution               completely, influenced by questions of profitability as measured by an
                                    increase in tangible assets. This approach is highly rational, based on the
     People are rational. If        assumption that all people act more or less rationally from economic
     one presents enough
     facts to people, they          motives. As a result, such groups often have high needs for control and
         will change.               for rationality.

                               4.   The Academic Strategy

                                    The academic strategy assumes that “People are rational. If one
                                    presents enough facts to people, they will change.” To this end,
                                    academic strategists undertake an unending series of studies and
                                    produce thousands of pages of reports each year.

                                    Inclusion in a group that plans to use the academic strategy to solve
                                    problems or to make changes is based primarily on one’s expertise in a
                                    given area or on one’s desire to acquire such knowledge. Leadership and
Fig. 5.13: The Academic
           Strategy                 influence within the group generally depends on the degree to which the
                                    person is perceived as an expert. Newcomers to the field are considered
                                    to have little to contribute, while those with advanced degrees or many
If the environment or the
  surroundings change               years of specialised study receive a great deal of attention.
  enough, people will be
                          5.        The Engineering Strategy
     forced to change.
                                    Users of this strategy try to bring about behavioural change without
                                    dealing directly with the people involved. The underlying assumption is, “If
                                    the environment or the surroundings change enough, people will be
                                    forced to change”.

                                    Therefore, engineering strategists may spend a great deal of time
                                    studying physical layouts, patterns of interaction, and role descriptions in
                                    work place and classrooms without ever speaking to the employees or
Fig. 5.14: The Engineering
                                    students. Groups that approach change in this way often recruit members
           Strategy                 based on their technical skills. Group needs often are defined in terms of
                                    technical skills, which are considered more important than interpersonal
    People react to                 styles.
 genuine threats. With
enough physical force,         6.   The Military Strategy
people can be made to
     do anything.                   The military-style approach to change is based on the use of physical
                                    force. The name military has been given to this approach because it
                                    conveys the appropriate connotation to most people, not because the
                                    military is the sole user of this approach. Police departments,
                                    revolutionary student groups, and some teachers, for example, employ the
                                    military strategy.

                                    The basic assumption behind this approach is, “People react to genuine
                                    threats. With enough physical force, people can be made to do
                                    anything.” Therefore, considerable time is spent in learning to use
 Fig. 5.15: The Military            weapons and to fight. Physical conditioning, strength, and agility are
            Strategy                valued.
     Membership in military-strategy groups is often determined by one’s                           Change
     physical power and by one’s willingness to submit to discipline. Both                    Management:
                                                                                              Concepts and
     within the group and in its dealings with the external environment,
     influence is exerted primarily through the fear of authority and through the
     threat of punishment. Members of military-style groups need control,
     status, and security. They often tend to view most problems and
     relationships in terms of power, authority, threat and exploitation.

7.   The Confrontational Strategy                                                      If one can mobilise
                                                                                    enough anger in enough
     The confrontational approach to change is based on the assumption that         people and force them to
     “If one can mobilise enough anger in enough people and force them               look at a problem, the
     to look at a problem, the required changes will follow.” Although               required changes will
     conflict is stressed, this strategy emphasises non-violent conflict rather
     than physical force. Membership in such a group is based on one’s ability
     to deal with and to use conflict in ways that benefit the group.

We end this discussion by presenting a collection of principles/rules of change
formulated on the basis of the research and experience of social and
behavioural scientists.
                       Box 5.7: Some Principles of Change
                                                                                    Fig. 5.16: The
 •    Organisation is a system comprising many inter-related/inter-dependent                   Strategy
      components. Change in one component affects others.

 •    Accepting ownership in the change process best facilitates change.

 •    Any change upsets the equilibrium of the organisational system – hence
      it will be resisted. Change interventions should be made in a planned
      way, otherwise the system would return back to its past patterns.

 •    People really don’t resist change; they resist the pain or threat, which
      they anticipate for themselves or others out of it.

 •    An enlightened self-interest of stakeholders facilitates change.

 •    Timing of change is highly significant – time should be ripe for making

 •    An accurate and comprehensive design diagnosis is essential for
      designing appropriate interventions.

 •    Change agents are required for affecting changes. They must know how
      to analyse and manage the restraining and driving forces (Unit 7). High
      adaptability helps change agents and change plans.

 •    High self-awareness is required in planning for change.

 •    People affected by change should actively participate in making the

 •    The acceptance of organisational change will increase if the people
      affected are invited to contribute to the change process, communicated
      honestly about all facets of change, given concrete feedback about the
      change and recognised appropriately for their specific contributions.
Change Management
in Power Distribution       5.8 COMMON INTERVENTIONS FOR MANAGING

                        It is very difficult to enumerate and explain all interventions for managing
                        change effectively. However, in this section, we discuss a few important
                        commonly used techniques and present case studies.

                        •    Communication

                             Authentic and complete communication on the objectives, coverage,
                             timing, costs, individual and organisational implications and change
                             methods and the consequences of not going for change and post change
                             benefits is most essential for managing change.

                             Case Study

                             At the Corporate office of a large organisation, as prelude to making
                             change, it was diagnosed that the executives numbering 15 were not
                             communicating with each other. The communication climate was hostile
                             and the top management was perceived as autocratic. Enhancing the
                             communication climate emerged as one of the major concerns. As one
                             intervention, the executives were asked to sit together for 15 minutes in
                             the conference hall around the round table. Initially the executives
                             resented this move but gradually they started sharing some of the
                             operational problems they were facing and others started responding by
                             giving their comments and solutions. Thus they opened up and shared
                             their feelings, concerns, agreements and disagreements, etc. Within a few
                             weeks, this meeting became the most liked forum of communication.
                             Often they had to extend the timing. This forum became the initiating and
                             facilitating platform for major changes in the next few years.

                             There is no standard plan for communication, but pre-intervention
                             diagnosis should attempt to understand the communication climate, styles
                             and barriers. Creation of a supportive communication climate is highly
                             useful in making change interventions.

                        •    Education and Training

                             All involved persons may not have the desired environmental,
                             organisational, functional, technical, financial, strategic, behavioural
                             knowledge and skills. Education and training is very essential at all stages.

                             Case Study

                             In the pursuit of designing and commissioning a comprehensive
                             Performance Management system in a large PSU, almost two years were
                             spent in educating and training the senior management personnel and
    users to make them understand the concept, realise the need, express                  Change
    their satisfaction and dissatisfaction from the existing system, and define      Management:
                                                                                     Concepts and
    their expectations from the proposed system. Even the design of the
    proposed system was prepared in training and development programmes
    using Behavioural Science based interventions. After the programme was
    approved for implementation, a series of training programmes were
    conducted for the users. Background support was provided through
    internet and publication of literature. Over 200 Performance Management
    Systems trained separately for ensuring smooth implementation could
    multiply the efforts. Even an interactive website was installed for resolving
    the doubts online. All this helped in covering a large section of executives
    in a short time and fear of change could almost be eliminated.

•   Participation and Involvement

    The persons likely to be affected need to be involved right since the initial
    stage. Their active involvement in all stages of the processes will not only
    provide valuable ideas at every stage but also inculcate a sense of
    ownership. For example, in installing an incentive scheme in a medium
    size Engineering company, the line managers and worker representatives
    were involved right from the beginning, i.e., from the stage of feeling the
    need, identifying the benefits and problems, collection and analysis of
    data, designing and developing the system.

•   Facilitation and Support

    Change initiatives should be facilitated by skilled facilitators (change
    agents). This helps in bringing the issues to the fore, proposal and
    resolution of conflict, team building and development of a conducive
    change climate.

    Facilitation is a process in which a person, acceptable to all members of
    the group, substantially neutral and having no decision making authority
    intervenes to help a group improve the way, in which it defines and solves
    problems and makes decisions in order to enhance the effectiveness of
    the group. The main task of the Facilitator is to help the group increase its
    effectiveness by improving its processes. A process refers to how a group
    works together and includes how members talk to each other, how they
    identify and solve problems, how they make decisions and how they
    handle conflicts, etc.

    Facilitation is of two broad types: basic facilitation and developmental
    facilitation. In basic facilitation, it is expected that the Facilitator would
    guide the group using the principles of effective group processes
    observing both contents and processes. In developmental facilitation,
    group members expect the Facilitator to monitor and guide the group’s
    processes and teach them how to accomplish this goal.

Change Management       •    Negotiation
in Power Distribution
                             Negotiation is quite useful in dealing with resistance to change. It is also
                             useful when resistance comes from a powerful person. Three basic types
                             of negotiating styles have been described – Tough battler, the
                             Supportive Facilitator and Cognitive Reasoner.

                             A negotiator should understand these three styles and should be well
                             versed in using all the three styles as each style is effective in a particular

                        •    Co-opting

                             Assigning a key individual member a desirable role is quite effective in
                             managing change. The co-opted person becomes a Key Resource Person
                             in charge of project and by way of his/her power base, is able to influence
                             others. His/her involvement and contribution helps the change process.

                        •    Manipulation

                             This technique comprises covert influencing tactics which uses twisting
                             and distortion of facts to make them appear more attractive and potent.
                             This also includes hiding or withholding undesirable information and
                             creating rumours. Cooperation is also used sometimes as a manipulative

                        •    Coercion – Implicit and Explicit

                             This involves application of direct threats or force on those who are
                             resisting or are likely to resist. In some situations it may be successful, but
                             in most circumstances it is not effective.

                        We hope that this discussion on Change Management will help you
                        understand change in your organisation, the factors that are bringing about
                        this change and how you can manage it for attaining your objectives. In this
                        rapidly changing world change is the only constant. In this unit we have tried
                        to define change, understand the concept of change and types of change.
                        Drivers for change and alternative strategies of change have also been
                        discussed. Different models of change are described. On this note, we end the
                        unit and present its summary.

                            5.9 SUMMARY

                        •    Change may be perceived in two ways: Change as continuous and
                             intrinsic to an organisation and change as extrinsic and

                        •    A force of change is any factor in the environment (both internal and
                             external) that interferes with the organisation’s ability to attract human,
                             financial and material resources it needs, or to produce and market its
34                           services/products becomes. The drivers of change in business may be
     classified as market changes, technological changes and organisational            Change
     changes.                                                                     Management:
                                                                                  Concepts and
•    Making a change involves moving the work force in organisations and its        Processes
     work culture in line with the strategies, structure, processes and systems
     to achieve the desired state (vision).

•    In the three-step model, successful change in an organisation follows
     three steps: Unfreezing, intervening and refreezing. For attaining
     enduring results, change cannot be left to chance; rather planned efforts
     have to be made.

•    A number of theories and models have been postulated by Sociologists
     and Behavioural Scientists and have been compiled in the literature as
     seven pure strategies of change: the fellowship strategy, the political
     strategy, the economic strategy, the academic strategy, the engineering
     strategy, the military strategy, the confrontational strategy.

•    A few important commonly used techniques for bringing about change
     are: communication, education and training, participation and
     involvement, facilitation and support, negotiation, co-opting,
     manipulation, coercion – implicit and explicit.


1. Consider your present job and indicate which benefits emerging out of an
   effective change management are most important to you?

     a) Career advancement.
     b) Improved prospects.
     c) Job security.
     d) Increased job satisfaction.
     e) Respect and recognition.

     Justify your answer.

2. a) Which of the following changes have you experienced in the recent
      past at your work place?

            - new boss                        - new system/procedures
            - new work group                  - new products/services
            - new position (responsibility)   - new customer
            - new equipment                   - new location
            - new supplier

     b) Which change was most difficult for you?

Change Management          c) What were your thoughts and feelings before the change? Did you
in Power Distribution         have any fears? What were those?

                           d) How did you cope with the change?

                           e) What would have helped you to cope with the changes better?

                        3. Think of the changes that would be beneficial to your company/
                           organisation and respond to the following four questions:

                           a) What is the change you have thought of?

                           b) What are the reasons/benefits of the change?

                           c) How would the change affect the involved persons?

                           d) What support and tools should be provided to the involved persons for
                              managing the transition?