Four Major Forces Creating Change in Organizations Today - Skills That Leaders Need

Globalization, technological changes, knowledge management and cross boundaries collaboration are four factors that are major forces creating change in organizations today. These changes affect decision-making as organizations are forced to recognize that they need leaders who are innovative, creative visionaries who understand the various environments that their organizations are operating in, and are able to differentiate between these different environments. These environments include: the external or operating environment; the competitive environment (that part of the external environment in which firms that are competing for the same market exist) and the macroenvironment in which influences such as the economy, government regulations, societal values, demographics and technology come to bear upon an organization. Faced with such complexities leaders need to be equipped with appropriate skill-sets such as flexibility, good communication, and critical thinking and negotiation abilities. They must also be supported with the necessary resources in order to make good decisions that will benefit their organizations. Globalization A convergence of international activities such as the increase in overseas production of goods and services; increasing consumer demands in emerging markets worldwide; declining barriers to international trade aided by rapidly changing technology, have created a globalized economy in which inter-dependency among countries has emerged as the norm today. Therefore the hiring practices of companies who are seeking the best talent have changed because the best talent might no longer be resident in the home country. Companies have had to calibrate their hiring, training and management practices to meet this challenge. In a world where "Americans too often come across as intrusive,
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manipulative, and garrulous" (David, 2007, p.291), US organizations have to be respectful of the culture, customs, political, and legal differences of the countries that they are operating in. Some of these customs affect protocol such as the exchange of gifts, the observance of holidays, and labor laws. Even accounting standards vary internationally. Therefore organizations must be sensitive to these differences when formulating operational and human resource (HR) policies for implementation abroad for, in this global environment, it is hardly likely that companies can apply the domestic policies that work at home, abroad. Technological Change: Technology is like a two-edged sword that can make our lives easier or worse. The Internet has revolutionized the way in which information is exchanged, communication facilitated and commerce conducted. Technology is rapidly changing and effective management demands more knowledge in these areas in order for companies to manage their resources and develop, maintain or keep their competitive edge. While technology has enabled firms to save time and money by conducting business such as negotiations, trade, and commerce in real time, it can also facilitate the dissemination of sensitive information about a company's practices, trade secrets and new product development in a matter of seconds. Hackers can breach a company's security via the internet and put companies at risk. Organizations have responded by having whole new types of departments such as Information Technology (IT) departments, headed by managers with titles such as Chief Information Officer (CIO), to manage both the opportunities and the risks associated with technological changes. Additionally, technology has ushered in an array of high-tech devices that aid and facilitates companies in gathering and managing information, maintaining contact with their employees globally, making and communicating decisions instantaneously. This can be both a boon and a source of stress for managers and leaders who must learn to manage their choice and use of these devices. In a global economy technology can aid in knowledge management
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Knowledge Management Driving forces such as shifts in buyer demographics and preferences; technology, product and market innovation; changes in society, consumer attitudes and lifestyle all demand new ideas. This has created a need for knowledge workers. Knowledge workers comprise a company's intellectual capital and are made up of creative people with novel ideas and problem-solving skills. Managing its knowledge assets can give a company a competitive edge as it effectively utilizes the expertise, skills, intellect, and relationships of members of the organization. For example, a company's strategic management efforts can be greatly enhanced when knowledge that is resident in its international talent pool is tapped at its source, since a manager who is "closer to the ground" and part of the local culture might be better able to sense environmental changes than one who is not. Keeping knowledge workers motivated and incentivized by both intrinsic and extrinsic means will cause organizations to re-think and change their benefits and compensation methods and, perhaps, even redefine the traditional view of the employer-employee relationship into something new, such as a company-contractor model, for example. Cross-boundaries Collaboration An important part of knowledge management is effectively managing organization-wide collaboration. Use of appropriate technology and applications such as a virtual private networks; VoIP, e-mail, social networking websites such as Face Book, and even company-sponsored blogs can facilitate communication between an organization and its stakeholders, and help in different types of internal and external collaborative processes. An example of a tool that can be used in cross-boundaries collaboration might be an easily accessible online database that provides a central source of information to employees, customers, or suppliers. Managing in the 21st Century In the 21st Century change is the norm rather than the exception and leaders must be able to embrace it. They need to be able to develop:
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1. 2. 3. 4. 5. 6. 7.

A vision, and be able to communicate it to their organizations An orientation to serving An entrepreneurial mind-set A commitment to continuous innovation A global mindset Ease and confidence with technology Know-how in systems thinking (a broad view of the inter-relationship of an organization's parts, rather than a narrow view that is focused on one part or event.) 8. A sense of ethics and appreciation of spirituality in the workplace 9. A commitment to continuous learning, personal and professional development In order to respond effectively to the four major forces creating change in today's global economy leaders must be willing to embrace change; they must be curious and appreciative of the richness and diversity of other cultures. The must be trust-worthy and flexible; and they must have very strong time management, communication, conflictmanagement, problem-solving and people-skills in order to effectively manage these drivers of change. References David, Fred R. (2009). Strategic Management, Concepts and Cases, 11th ed. (p. 291). New Jersey: Pearson Prentiss Hall. Organizational Change: Literature Review The literature concerning organizational change tends to fall into one of two main categories, one that emphasizes organizational efficiency and the other which emphasizes social change. Within these two groupings a desired outcome is emphasized rather than creating a clear understanding of the dynamics of organizational change. I speculate this is due to market forces which has made improving organizational efficiency a lucrative enterprise. Another less dominate but significant market is interested in achieving social change generating a need for this type of literature. In reviewing this literature I believe that an over emphasis is being placed on selling books and services. The literature which emphasizes achieving organizational efficiency bases its assumptions on the work of Kurt Lewin. Kurt Lewin proposed a "force field" analysis
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model to understand organizational change. Force field analysis proposes that an organization is typically in a state of equilibrium. There are two forces which maintain organizational stability: driving forces and restraining forces. The driving forces are those elements of the organization which support a desired organizational change. Keeping the organization in equilibrium are the restraining forces. If the two forces are equal, the organization will remain static. Change occurs when one of these two forces becomes stronger than the other (disequilibrium). Once the change has occurred, the organization reverts to a new state of equilibrium which reflects the desired change. Followed to a logical conclusion, Lewins model predicts that an intervention which strengthens the driving forces or weakens the restraining forces will result in the desired change. Intervention strategies differ from author to author but they contain similar elements. The following are the basic elements of a formula based organizational change strategy. 1. Determining the need to change 2. Development of a vision. 3 Consensus building 4 Identify barriers to implementation 5 Walk the talk 6 Creating an overall change strategy. 7 Implementation and Evaluation According to Gateway Information Services, a New York consulting firm, 70% of all change programs fail due to employee resistance. Given the poor success record of various interventions strategies, it is reasonable to seriously question their validity as it relates to understanding the dynamics of organizational change. If intervention strategies are suspect, it is also reasonable to question the organizational change theory which supports these interventions. Lewins model of organizational change consists of two basic concepts. The first that an organizations natural state is static or unchanging. Lewin describes this state as being frozen. When the organization is in a state of change it is malleable or it thaws then reverts to a static or frozen state. The second is an organization can be successfully divided into two groups. One that seeks change and one that opposes change. I have grave doubts that either concept has much basis in actual organizations. The second grouping of literature concerning organizational change focuses on social change. In contrast to Lewin based interventions, this body of literature does not require
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the support of an organizations management. In fact it often assumes that change agents can expect the active opposition of those in power. This view of an organization is more compete and offer a better insight as to how an organization functions with respect to change. An organization needs the elements of power, leadership, management, authority, social control, cultural change and vision in order to function effectively. The priority of each of these elements depends heavily on the organization's overall mission. It is important to realize that the priority of each of these elements are not static but shift as the need arises. Change occurs through the action of a visionary. The visionary by nature, or definition, holds views different from the organization as a whole. Based on work done by Roseabeth Kanter, it seems that no mater were a person is in the organization they feel, at least to some degree, that they are powerless to change the organization. This, of course, is a matter of perspective. The people at the bottom certainly don't see the people at the top as being powerless. Yet the people at the top acknowledge all the trappings associated with power but don't experience the power to substantially influence the organization. The people who are in the middle share the view of power from both the top and the bottom simultaneously. I feel it is reasonable to conclude that a realistic understanding of organizational change recognize all of these viewpoints as an aspect of reality.

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