Managing, Organizing and Leadership - Assignment Example

INTRODUCTION This report discusses the change management with respect to downsizing, leadership as well as the commitment and identity of an employee towards the employer. Downsizing is when companies attempt to reduce the number of employees, and the perception of this process is totally dependent on how management handles it. The commitment of an individual towards company goals and the extent to which he identifies with it is also dependent on the motivation that companies give to the employees. Lastly, leadership styles and the powers vested within leaders are numerous and each has their own set of advantages and disadvantages. WHY DO CHANGE PROGRAMMES FAIL? Defining Organizational Change Organizational change is the adoption of a new idea or behavior by the organization. The environment, whether it is internal or external, keeps on changing and it is the task of the organization to be structured in such a way so as to respond to the changes by changing itself in the right manner. Or else it will be left somewhere behind in the race of this cut throat competition. Organizational change is a very big phenomenon that needs to be carefully studied as this factor distinguishes profitable and admired organizations from failing and unimpressive ones. (Patron 2000) Facing the ordinariness of the business life is a task that every organization can do but it is not easy to implement a change which is applicable to the whole organization and do it successfully. It is a task which has to be accomplished with the help of many things within the organization, be it be the leadership available or through the kind of corporate culture that has been developed and is existing over the years. (Richard 2000) Strategic Change as an Important Subject of Study Strategic change involves changing the organization as part and parcel of long term goals and strategic thinking. It gives the leader an impetus to start the initiative of change as it will reap great benefits in the long run for the company. The environment of todays business world has changed drastically. Trends have shown that it is the learning organization which benefits the most in today's rapidly changing environment. A learning organization is one where everyone who is a part of it is taking responsibility of identifying and solving problems existing within the organization. Thus, enabling the organization to continuously improve itself and outdo its own capabilities every time. Thus, this concept has started the race between organizations which has no end to it. Organizations have been entrusted with the responsibility of continuously improving and updating itself, if they want to survive. Thus, bringing change will be a very normal sign for the company of today. And these changes will always be linked to the strategies of the company as they will give a long term vision as to where the company wants to see itself going through adapting to this change. (Richard 2000) Why People Resist Change Change is about moving away from routine, about learning new things. Change is scary. People resist change because of a variety of reasons. Firstly, it depends on the individuals' predisposition towards change as to how he takes the change process. Predisposition is decided due to the upbringing of the individual and how he or she has spent their childhood. Secondly, there is always surprise and fear of the unknown. People do not know what change will bring for them. It is new for them, therefore unknown. Thirdly, a climate of mistrust often develops when such change process is started. People believe that the change process is only being brought so as to make things better for the organization and the top management. They do not trust the intentions of the guiding coalition. Fourthly, there is a fear of failure within individuals that if they fail in the new task that they have to do, then what will happen. (Fleming 2006) Moreover, if people lose their status, they become insecure about their job. And they see high amount of uncertainty in the future. Sixthly, peer pressure is also a factor. If a certain participant is not getting directly affected by the change process, then he will voice his opinions against it just because he has been pressurized by his peers who are getting affected. Seventhly, there are cultural traditions and certain group relationships that get formed when people are working together. Change might mean that they now disperse, resulting into the disruption of these relationships. Furthermore, personality conflicts between various people can trigger the resistance of change. Another factor is the lack of tact and poor timing of starting the change process. Maybe the fiscal quarter is already going very bad and the management initiates change. This is bad timing. Lastly, if the new reward systems are non-reinforcing, it can increase resistance to change. (Darwin 2002) Research on Resistance to Change Research on resistance to change has talked about certain personal characteristics among individuals which help them take change better. The first one among them is commitment to change. If people are made to believe in the good that will come out of the change process, they can be made committed to it. The second is the self concept of people. If people have a positive self concept of themselves, they will gladly be a part of the change process as they are not insecure about what they are and they have high levels of confidence within themselves. Thirdly, the tolerance for risk for every individual differs. Some are adventurous and would like trying out new things whereas some love the monotony in their lives. Lastly, the self efficacy of an individual matters in deciding if he is resistant or not. If a person believes that he can accomplish the new task, he would not resist the change. (Patron 2000) Strategies for Overcoming Resistance to Change Overcoming resistance to change is essential because if participants of the change process are not made to accept the change process through the various strategies now being presented, it will become really difficult to implement the change. (Fleming 2006) The first strategy is about education and communication. It is about teaching individuals of acquiring the new skill that is needed to bring the change. Effective communication from the top management will be really essential here because people need to know that they have their support. (Darwin 2002) The second strategy is participating and involvement where the participants of the change process are incorporated in the process from the start so that there is greater acceptance of it. The third strategy is facilitation and support where the top management provides all sorts of support, material or otherwise, to the participants of change so that they can be facilitated to pass through the change process with ease. The fourth strategy is that of negotiation which ultimately leads to an agreement between the top management and the change participants. A common ground is tried to be found so that resistance of change is decreased to the maximum. The last strategy is about explicit or implicit coercion. This is the least favored strategy as it might fail to give long term results and commitment to change. (Carnall 2003) DOWNSIZING IN ORGANIZATIONS When a company goes through downsizing, it actually intends to reduce the total number of employees that the company employs. This downsizing can be through various ways and because of different reasons. Firstly, when a company fires the employee and terminates his job for good at the company. Secondly, when a company encourages any particular employee or set of employees to go through retirement, this reduces the count of employees. And lastly, by the procedure of spin off, where employees are laid off because of the formation of the independent company. These employees have to be terminated because their skills are no longer in use both in the existing and the new independent company. thus, all in all, downsizing leads to de-motivation of the employees, whether those who are still in the company after the downsizing has taken place or those who have been the target of the downsizing. The employees who still remain in the company become insecure about their jobs and they feel that it is their turn next to get laid off. Thus, downsizing to inculcate change within the company has its own set of criticisms as well as discussions which might support it even. Research has been conducted on those people who survived the downsizing phase in the company. The hypothesis was that when a company downsizes and reduces their number of employees, it decreases the employee loyalty of those who have survived. In “To Stay or to Go: Voluntary Survivor Turnover Following an Organizational Downsizing,” Gretchen Spreitzer and Aneil Mishra (2002) argue that downsizing need not impact employees’ organizational commitment if handled correctly. Spreitzer and Mishra contend that if layoffs are conducted openly and honestly, employees may actually become more loyal to their organization. The roles of trust, justice, and empowerment influence layoff perceptions and shape employee attitudes regarding organizational attachment. High trust indicates that competent, reliable, honest, and concerned managers have engaged in open communication. A sense of justice occurs when employees feel that the layoff process was conducted fairly based on clearly defined methods instead of through politics or favoritism. Empowerment describes the benefits of layoffs. It is likely that survivors will have the chance to expand their roles and responsibilities as they take on new duties and positions. Spreitzer and Mishra conclude that if downsizing proceeds positively within these three areas, employee attachment can be strengthened. Thus, this research concludes that the alternative hypothesis was true. The Spreitzer-Mishra article is extremely insightful in explaining how downsizing may produce concerns regarding job insecurity and how those feelings do not necessarily translate into decreased loyalty or increased turnover. Most rational people understand that external forces may coerce an organization to downsize. It is the way in which this process occurs that impacts employee perceptions and causes them to react positively or negatively. Criticisms of Downsizing The uncertainty, stress, and paranoia associated with corporate downsizing can anger and alienate employees to the point where they are motivated to quit. Often a company has scant opportunities for recognition and advancement which also becomes a major source of concern. Moreover, if companies do not recognize individuals or teams for their accomplishments, employees begin to look for feedback and a sense of community and camaraderie elsewhere. The organizational structure may also be a very prominent contributor. For instance, if the organizational structure is such that there are no pathways for upward mobility, then this also discourages the staff members. Downsizing can demolish employee motivation, morale, and sense of security. The change can be amazing. What was once a group of dedicated, energetic, professionals might transform almost overnight into a group of sullen and suspicious slackers who performed work only when absolutely necessary. It is normal for job-insecure workers, Holm and Hovland (1999) argue, to react to downsizing both internally by experiencing psychological or physical problems and externally through modified behaviors, such as decreased productivity. Job elimination is especially threatening because employees feel powerless when confronted with evidence that their organization is declining (Holm & Hovland). Consequently, employees tend to withdraw, losing trust in and commitment to the company (Holm & Hovland, p.160). Employees might react in an extremely hostile and defiant manner, as if they took the layoffs personally and felt betrayed. The process by which personnel were selected to be laid off may also be enough to explain the vehement reaction that usually follows after the downsize. The major mistakes that managers can make here is to hold a series of closed-door meetings at which employees are discussed and ranked. This means that the manager is not communicating the criteria that would be used to make the selections. And the worst part occurs if the employees who are least expected to be laid off, are in fact, laid off. For instance, many employees would feel that seniority would factor into play, but if the company announces some names of employees who have been with the company the longest, confusion and anger begins to surface. Rumors about “the list” begin to circulate, and staff members, who never did receive any kind of meaningful communication, will think the worst. The layoff timing and methodology is also very important and may contribute well to demoralizing the personnel. For instance, if the company uses the methodology of locking he physical and motor developmental change follows age wise particular pattern. Gross motor skills are referred to the movements of the large muscles of the body like arms, legs, feet, or the entire body. Activities related to gross motor skills are easy tasks like running, jumping etc. the employees out of their computers when they come back from lunch, this goes out to say that the organization is using the worst and the most unethical methodology possible. They had not even been given the courtesy of advance notice so they could download personal information from their hard drives before the IT staff enacted security protocols. They felt like criminals. Even if management learns from this mistake and does not repeat it for the subsequent groups, the damage will already have been done. Employees will hold the company responsible and will dread coming back to work because they will not know who or how many would be next. Moreover, a company will make matters worse if they start downsizing only women. This will show that the company is practicing a lot of inequity within and in the process of downsizing. Spreitzer and Mishra hold that “the trustworthiness of top management and perceived justice of the downsizing implementation will lead to more survivor attachment because they reduce perceptions of threat inherent in the downsizing” (p. 710). For this to happen, however, survivors must have positive perceptions of three roles: 1) trustworthiness of management, 2) empowerment of remaining employees, and 3) justice during the downsizing process (Spreitzer & Mishra). Employees determine trustworthiness through their perceptions of management’s honesty, competency, reliability, and concern for their welfare. Research conducted by Abraham Morrall (1999) shows that a high loyalty rate is possible during a downsizing, but only when there is “honest communication” that prompts employees to feel that the “organization conducted the downsizing openly”. The issue of perceived injustice, if there is during the downsizing, also may serve to anger the employees. If organizations adopt a “fairness of process” whereby decisions are made by a clearly defined methodology as opposed to “favoritism or politics,” survivors are less threatened and employer attachments may even be strengthened (Spreitzer and Mishra, 2002). What the Company Should Plan During and After Downsizing A company should always have a proactive plan to calm employee fears during the downsizing, and the company should continue to offer recognition or advancement to talented employees. If after a downsizing, a company does not understand and work to mitigate this impact, employees will continue to leave. The company will lose all the institutional knowledge that has been gained over the last years, as well as the strong relationships that exist with the various stakeholders of the company. Stakeholders often exhibit loyalty to specific people, which are specific leaders, not to faceless companies. If companies continue down this path of downsizing with a bad communication approach and no plan to handle its effects, they will be bereft of talent and growth potential in the very near future. A company, after downsizing, needs to learn from the current state of affairs. Company representatives can speak with employees about ways to strengthen employee morale and increase opportunities for recognition and advancement. First, the company needs to take the time to understand and truly listen to what the staff is saying and jointly develop ideas that might improve relations in the future. Next, the company must act upon this input by designing and implementing activities and/or procedures that will achieve improved relationships and identification. Finally, the company must reassess its organizational structure and check for possible flaws within it and bring changes accordingly. COMMITMENT AND IDENTITY Commitment and identity are two concepts which have a lot of relation with how the employees of a certain company perceive themselves within the company. Commitment is the level to which the employee feels that he is obliged to the company and thus, he not only fulfills all his job responsibility, but also wishes well for the company and might even do extra tasks which will benefit the employee. Identity is the degree to which an employee can identify himself within the values of the company. for instance, if some certain company believes in corporate social responsibility, then an employee might prefer it over other organizations just because it gives a sense of achievement to the employee because he was able to match his self identity with the organizational identity. Employees whose self identity is parallel with that of the organizations are more likely to work with more interest and commitment. Mats Alvesson (2000) examines how a sense of identity impacts employee loyalty and causes turnover. His articles examines employee identity with respect to a knowledge-intensive company. A knowledge-intensive company is one “where most work can be said to be of an intellectual nature and where well-educated, qualified employees form the major part of the work force” (Alvesson, p. 1101). Identity is an important factor in these environments because “competing identities” can direct employee loyalty towards or away from the employer. These employees work quite closely with clients, which may introduce feelings of “belongingness and identification” with the client as opposed to the employer. Professional affiliations are also a factor. Alvesson states, “Even if one should downplay conflicts between organizational and professional commitment, it is nevertheless likely that a person who sees herself primarily as a professional—broadly defined—develops weaker ties to the company as such” (p. 1109). To counteract these problems, Alversson suggests increasing “communitarian-based” loyalty by strengthening relationships between employees and thereby indirectly enhancing loyalty to the company (p. 1112). Managing loyalty, Alversson claims, is a strategy for managing turnover. Within an organization there are multiple dimensions in which employees socially categorize and identify themselves: 1) the personal level with a focus on career, 2) the group level with a focus on relationships within teams or departments, or 3) the organizational level with a focus on the organization as a whole (Van Dick et al., p. 172). The key is determining the salient category, which is most responsible for influencing a person’s behavior at a particular moment: “When an individual’s personal identity is salient and he or she identifies strongly with the individual career, one would expect this person to behave in a way that allows his or her career to progress” (Van Dick et al., p.174). This behavior, however, can fluctuate if another identification dimension becomes salient. Turnover intentions are consistently tied to the organizational dimension (Van Dick et al., pp. 183-85). While employees may have high job satisfaction and positive, productive relationships with team members, negative identifications with the organization could nevertheless become salient and motivate resignations. This idea of multiple, shifting identities helps to explain how employees can experience job satisfaction but still be eager to leave their place of employment. Criticisms of Commitment and Identity A strong team or personal identification and commitment, however, can be negated if the organizational perception and identification are negative, and this situation is extremely harmful because “identification with the organization is related to turnover intentions and job satisfaction”. For instance, a certain company’s web developers might be a highly cohesive, independent team, but they will most probably lose that identity when they are integrated into the massive IT department. Instead of focusing on and identifying with positive and fun team interactions, the employees may now focus on their resentment. They will wander the halls looking for IT management to give them tasks and direction, and instead of finding management they continue to encounter new faces every week. This might lead to high turnover in IT. Employees need to feel that they are developing, growing, and advancing. When they are placed within an organization that does not allow for advancement, no matter how much development and growth have occurred, they experience stagnation and feel that it is time to move on. In addition, if no employee ever sees any other employee promoted, morale is lowered and overall organizational commitment decreases: “Promotion ladders serve two purposes: they motivate employees to perform well and induce them to remain with the company. In order for an organizational structure to accomplish both goals there must be opportunities for advancement and some employees must, in fact, be promoted.” (Petersen et al,). This lack of upward mobility may not be noticed for a while, as new employees gain experience and skills, but eventually they begin to wonder why in the world they are remaining with a company that does not appropriately reward them for their efforts. Developing Programs to Foster Commitment Companies should establish positive programs that would strengthen employee-company relationships and commitment. In other words, organizations should establish a robust human resources program that offers a variety of support, such as career counseling. Monica Oss (2004) argues that one way to increase retention is to “transform the ‘personnel office’ into a human capital development department” (p. 22). HR personnel could spearhead initiatives that seek to enhance both technical and supervisory skills, such as problem resolution, team building, or effective communication (Oss). These new skills will not only make employees more productive, but will also enhance their self esteem because they will perceive themselves as having increased “employability” (Oss, p. 26). The HR Department should believe in good intentions, and they also should be proactive rather than reactive. If the staff of the HR Department only shows up during times of turbulence, employees will start associating their mere presence with trouble. By expanding their role to include professional development, they would benefit from a more positive image while the employees would benefit from the training sessions. While it may appear risky to help develop in employees the skills and confidence that may make them desirable to competitors, the interactions should actually boost organizational commitment. J. Bryan Fuller, Tim Barnett, Kim Hester, and Clint Relyea (2003) study the effect of “perceived organizational support” on turnover rates. Using social exchange theory, also known as reciprocity, they argue that “people are likely to become committed to an organization when they feel that the organization is committed to them” (p. 789). Establishing programs that bolster employee skills, esteem, and morale will likely lead to increased loyalty because the employees will feel that their company actually cares about them and their futures. LEADERSHIP Leadership is the process by which one individual influences others to accomplish desired goals. Within the business organization, the leadership process takes to form of a manager who influences subordinates to accomplish goals defined by top management. There may be two different kinds of leadership in any organization: formal leaders and informal leaders. The two are not the same, yet both may exercise leadership behavior in influencing others. A formal leader is someone officially vested with organizational authority and power, and is generally given the title of supervisor, manager or executive. The amount of power is theoretically determined by the position occupied with the organization. An informal leader will not have a formal leadership title, but will exercise a leadership function. Without organizational authority, assignment of power, position or even responsibility, an informal leader (by virtue of a personal attribute or superior performance) may influence others and act in leadership capacity. Organizational Power Entrusted Within Leaders Power is the ability to influence subordinates and/or peers by controlling resources. A successful leader effectively uses power to influence others. It is important for a leader to understand the sources and uses of power to enhance their leadership ability. The types of organizational power are: Legitimate Power; Reward Power; Coercive Power; Expert Power; Referent Power; and Information Power (Bielous 1995). Legitimate power is the power inherent within the organizational structure itself (Bielous 1995, Salzwedel 2002). This power is assigned to an individual who occupies a specific position within the organization. Should the individual leave the position, the power remains with the position and does not follow the individual. This power is made legitimate within the organization, and the individual is vested with the power. Reward power is also inherent within the organizational structure in that managers are typically given administrative authority over a variety of rewards (Bielous 1995, Salzwedel 2002). Since employees desire rewards, they can be influenced by the chance of receiving them as a result of work performance. Organizational rewards may be the obvious (pay and promotions), or they may be more subtle (praise, status and attention). Coercive power is based upon the manager’s ability to punish an employee (Bielous 1995, Salzwedel 2002). Punishment options range from a mild warning to suspension to termination. A range of punishments is needed because management requires some degree of flexibility so that the punishment applied is suitable to the offense that gives rise to it. Expert power comes from the expertise possessed by the manger, and the value and need of this expertise within the organization (Bielous 1995, Salzwedel 2002). This expertise is a result of the manager’s special skills, knowledge, abilities and/or previous experience. Expert power, derived from special knowledge or advanced education, is typically unrelated to age and job seniority since it often depends upon educational achievement and not necessarily time on the job. Referent power is the ability of one individual to influence another by force of character, also known as charisma (Bielous 1995, Salzwedel 2002). A manager may be admired because of a specific personal trait, and this admiration creates the opening for interpersonal influence. A manger that is talented, or even just plain likable, may be described by employees as inspiring and motivating. Information power comes from the possession of key information at a critical time when such information is necessary to the functioning of the organization (Bielous 1995, Salzwedel 2002). The possession of information may be completely unrelated to a manager’s position or given power. Leadership Styles – Advantages and Disadvantages Some prominent leadership styles have been noticed within all leaders on a general level. They are a total of six. They are coercer, authoritarian, affiliator, pacesetter, coach and democratic. Each leadership style has its own advantages and disadvantages. A good leader is one who is a perfect blend of many of these leadership styles. The coercer style is good when there is a crisis situation and work needs to be done quickly. But it will have a negative impact if the workers are already working very efficiently. The authoritarian leadership style is also good when information is needed on a particular situation or before inspections. But it cannot be used in personal counseling sessions else the employee will feel threatened and might never open up. The affiliator style is at an advantage when people should be the leader’s first concern. This style assures job security and various other benefits to the employees. But in times of crisis, when a person who really cares about the job getting done is needed, this style would not work. The pacesetters are those who would lead the way truly by doing the job themselves first and setting an example through that. This style is good when task is technical enough or difficult to do and the employees need to know that their leader can do it too. But this can often get troublesome for the leader since he would not be at peace at any point in time if he does not do the job himself, a factor which can hamper work productivity. In the coach style, leaders are more concerned about the good development of their subordinates. They even let their workers set their goals themselves. The disadvantage can be that workers might misuse this authority and empowerment that they are getting. Lastly, in the democratic style, the leader wants to do what the employees want but this can hamper the growth of the company since employees interest might not collide with that of the organization. CONCLUSION To conclude it can be said that these are times which are very dynamic. The business world has to respond to these dynamic times by continuously making itself better and inculcating new developments within the world so that it is not left behind. Initiating change and bringing it about successfully is the joint work of leadership, corporate culture, the employees and the top management. The downsizing process of the company has to be thoroughly studied and planned before it is initiated, because the reputation of the company depends on it. Moreover, employees’ commitment and identity also depend on how well the leaders are doing their job and how much of positive communication has been dispatched during the painful process of downsizing. BIBLIOGRAPHY 1. Carnall, C. (2007) Managing Change in Organizations. Prentice Hall. 2. Darwin, J. (2002) Developing Strategies for Change. Prentice Hall. 3. Fleming, J. (2006) Organizational Change. Prentice Hall. 4. Rob, P. (2000) Change Management: A Guide to Effective Implementation. Sage. 5. Kouzes, J. (1997) The Leadership Challenge. Jossey-Bass. 6. Northouse, P. (2007) Leadership: Theory and Practice. Sage. 7. Dollarhide, M. (1996) Downsizing: Law and Practice. Bureau of National Affairs. 8. Tomasko, R. (1987) Downsizing: Reshaping the Corporation for the future. AMACOM. 9. Alvesson, M. (2000). Social identity and the problem of loyalty in knowledge-intensive companies. Journal of Management Studies, 37, 1101-1123. 10. Buck, J. & Watson, J. (2002). 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