Information technology as agent of change

INTRODUCTION

Organization must change continuously due to the changes in their environment (Donaldson, 1996). Rapid change and unpredictable event occur in the business environment. These changes are, in part, the result of market growth or technology development, and they create turbulence that can destroy the exiting competencies (Tushman and Anderson, 1986). The aim of every organization is survival, thus the need for an effective change in an organization can never be overemphasized.

However, note that organizational change is a generic term and is a broad concept involving ''analytical, educational, learning and political process as well as a process which combines rational, political and cultural element'' (Hendy 1996). In essence organizational change is an end state of a transformation process (Tsoukas and chic, 2002).

Failure to implement a change effectively in an organization can be very dangerous, however there are factors needed for change to be carried out effectively and they include management involvement and commitment, culture change, communication, training, project management skills.

The next section of this paper will focus on the literature review which will explain some of the factors behind an effective change in an organisation. The Lewis Model of Change and the Gleicher's formular of change will be used to analyze the case study. The case talks about Sunrise Industries Limited (SIL), an organisation that had to change in other to stay above its competitors in the market, furthermore the adoption of information technology (IT) was essential to the company, because the organization did not believe in the use of IT, it preferred carrying out its operations manually.

The need for IT in an organization can never be overemphasized, knowing fully well that the first aim of every organization is survival, the adoption of IT into every organization business process is very important. Top management support has been widely cited as one of the major drivers of IT adoption in any organization (Dvorak et al, 1994). The greater the support of top management, the greater the probability that new IT applications would be developed (King et al, 1999).

LITERATURE REVIEW

Change takes place virtually every day, change can be said to be the process of moving to a desired level no matter the event. It is embraced or resisted by people or organisation, accepted or rejected. Change in an organization can arise due to internal or external factors. At SIL external factors caused the company to change the way of its operations. As a result of these factors, organization must undergo various adjustments to adapt and satisfy the various demands of its organizational needs.

LEWIN'S APPROACH OF CHANGE

This Kurt Lewin approach to change is still in use till date, it's one of the approaches of implementing change effectively. The effective implementation is vital in an organization, if the change is not implemented properly if might lead to some form of resistance. Kurt Lewin was the first to use the theory of planned change (Burnes, 2004). The theories are as follows.

FIELD THEORY

This approach of understanding the group behavior involves mapping the field where the behavior took place. The view of this approach is that if it is possible to locate the forces, the easier it will be to understand why group, organization and individual behave the way they do and also appropriate measure be taken in order to bring the desired change (Burnes, 2004).

GROUP DYNAMICS

The approach focuses on change at a group level (Burnes, 2004). Lewin could see that it was better to change a group of people than an individual. This reason is because the group standard such as norms can cause resistance (Lanning, 2001).

THE THREE-STEP MODEL

Schein (1996) in his paper about change discussed the Lewin Model of Change. According to Schein, Lewin, in the 1950s, introduced a model to understand organizational change; the model is still being used today. In his model of change, Lewin identifies three important change processes. Which are unfreezing, change and refreeze?

  1. UNFREEZE: The unfreeze stage involves preparing the organization for change while informing employees as to why change is needed. It involves using the organisation's vision to support the change. This stage usually brings dissatisfaction amongst members of the organization. One of the most difficult part of the unfreeze process is getting people accept the change (Miller, 1982). Unfreezing will help create a readiness for implementation of the change.
  2. CHANGE: At this stage, a new organizational behavior is being created. It takes lot of time for people to accept and adjust to this change. It is the duty of the top management to explain to the employees the need for the change and its benefit to the organization. This stage considers all the driving and restraining forces by evaluating and identifying them based on trial and error basis (Burnes, 2004).
  3. REFREEZING: When a change is implemented, the employees in the organisation have to learn the new transformations the change has brought. At this stage a lot of training and support is needed for the employees to learn the new behaviors required. The main aim of refreezing is that new behavior must be, to some degree, congruent with the rest of the behavior, personality and environment of the learner or it will simply lead to a new round of disconfirmation (Schein, 1996).

COMMUNICATION

The role of communication becomes very important when organization desire a change. The first goal of organizational communication should be to inform the employees about their task and about the policy and other issues of the organization (De Ridder, 2003). Communication is a key factor of an effective change, and more importantly communication can prevent resistance to change in an organization. The advantage of this is that, the effectiveness of the change will be greater. According to Difonzo et al (1998) 'Communication is vital to the effective implementation of organizational change'. ''The most effective method of communication is to use as many different means to communicate as possible and, foremost, to keep repeating the message several times in every possible occasion - it can either be official or unofficial''(Lanning, 2001). Effective communication will help the employees know what the advantage the change will bring.

MANAGEMENT INVOLVEMENT AND COMMITMENT

The involvement of management is also critical in achieving the desired change in an organization, especially when it is of great benefit to the organization. Without a strong leadership in place, the probability of change being successful will be limited, in addition for a change to be effective, the management must demonstrate strong leadership skills. Management can also get the employees involved by seeking improvement from them (Lanning, 2001). For effective change to be implemented the bottom-up approach also needs to be considered. The top-down approach will provide enough vision for the employees while the bottom-up approach will encourage participation.

PROJECT MANAGEMENT

The main purpose of project management is to get a job done in a successful and effective way. Another important aspect of project management is to minimize cost associated with the implementation of change. Project management is about coordination, teamwork, planning, and control techniques. Burke accurately depicts the usefulness of project management by stating that,''Any activity mankind embarked on in the course of time has definitely required someone managing it (Burke, 11). Jurison (1999) states the main reason of PM; he states that PM is a series of activities carried out on a project effectively to get a desired result.

TRAINING

In different organization the importance of training is vital; training will assist the employees gain skills. Training will give the employees the willingness to change and the required skills (Lanning, 2001).

KOTTER THEORY OF CHANGE

Kotter (1995), in his paper, listed eight transformation steps. The steps includes:

  • Establish a sense of urgency
  • Forming a powerful guiding coalition
  • Creating a vision
  • Communicate the vision
  • Planning for and creating short-term wins
  • Consolidating improvements and producing more change
  • Consolidating improvement and producing more change
  • Institutionalizing new approach

GLEICHER'S FORMULA FOR CHANGE

The Gleicher's formula for change provides a model to assess the strengths that can affect the process of change, originally created by Richard Beckhard and David Gleicher, but now known as the Gleicher's formula. The formula states that

Δ = D x V x F > R

Where Δ = Change, D= Dissatisfaction with how things are now (status quo), V= Vision, F= initial, concrete step that can be taken towards the vision and R= Resistance to change.

To conquer resistance in an organization, the three components must be present. If any of this is zero (not present) the end product will also be zero. The first variable (D) states that people change because they are generally unhappy with their present status. The second variable is the (v); the implication of this is having a desired state that one desires to move to, it is also important to know the advantage of the change needed. The third variable (F) is the initial concrete step one takes toward the vision. All three must however be greater than the resistance.

CASE STUDY ANALYSES

The case is based on Sunrise Industries Limited (SIL), one of the oldest manufactures of industrial hydraulic cylinders and gears in India. The case highlights the effects of external factors such as regulatory changes and industrial structures on information technology (IT) investment and the IT applications portfolio. It also describes the evolution of the use of IT in the company over time.

Sunrise Industries Limited (SIL) was a manufacturer of industrial hydraulic cylinders and tipping gear equipment. It was a family owned business, established in 1967. The company main products were the first, the tipping gears, and these formed 60% of the company's total business. The second kind of products, the hydraulic cylinders, formed 30% of the total revenue of the company. The mining pit props formed the remaining 10% of the company's revenue. The chairman was the executive head of the operation and belonged to the family that started the company. He was advised by the Deputy Director, who was in charge of the overall operation of the company. The case states that the company manufactured standard products, with standard specifications that were constant for specific customers and did not change drastically very often.

But during the years 1992 to 1994, the industry structure underwent significant changes. The regulatory entry barriers for the hydraulic equipment and every other automobile ancillary segment were lifted, and these allowed new competitors enter the market. At SIL, even though top management was reluctance to adopt IT, the changes in the environment coupled with increasing competitive pressures and the poor performance of the company finally resulted in the adoption of IT. The implementation of IT was necessary because it will help the company in a long way in meeting their customer's request, which was also a huge factor. The organization leadership at this point realized with reluctance, that IT had a big part to play in cost cutting and most importantly in improving the performance of the company. Due to the changes the industry structure underwent, management recruited an Information System Manager in 1995.

LEWIN'S MODEL OF CHANGE.

The Lewin's three change process will be used to explain how Sunrise Industries Limited (SIL) adopted information technology (IT) into their organisation

  • UNFRREEZE: Sunrise Industries Limited (SIL) a manufacturer of industrial hydraulic cylinders and tipping gears equipment. A change was needed in the organization; the reason for the change was because the company was falling behind their competitor which was as a result of barriers of entry lifted in the industry and market. Additionally, another reason change was necessary was because the company's turnover which increased by 70% from the late 80's to the early 90's started decreasing, the turnover rate decreased by 30% between 1997 and 1999 this also clarified the need for change in the industry. The adoption of information technology (IT) had a big part to play if the organization was to meet its vision.
  • CHANGING: In this stage, SIL started the adoption of information technology (IT). The leadership started integrating IT into the organization. This was achieved by automating a large part of processes that heavily used manual labour. Most of these functions involved the use of heavy transaction processing and hence IT was used to automate them. Management realized that besides aiding in automation, IT could help significantly in the cost-cutting effort. In the initial stage of implementing IT, three stand alone computers were installed; the number of computers increased with time, Jobs like printing of purchase orders, invoice and goods receipt note were also performed through the computer. At this stage a database accounting and payroll package was also developed. The management also introduced information systems (IS) function into the organization.
  • REFREEZING: At this stage SIL adopted IT fully into its business; it also recruited an Information Systems (IS) Manager to stabilize the adoption of Information Technology (IT). Applications were developed for the crucial processes of the company, more IT specialist (System Analysts and Programmers) were hired to staff the IS department and initiate development of applications. Investments were made into five personal computers, word processing and accounting applications, and in setting up a new IS department.

GLEICHERS FORMULAR OF CHANGE:

DISSACTIFACTION:

We can analyze here that the management at SIL were dissatisfied with the performance of the organization. The revenue of the company dropped drastically and customer preferred to go to other manufacturer to get whatever they needed. The management at SIL were dissatisfied with the situation and resolved to create solution for the problem.

VISION:

The management at SIL had a vision and the vision was to be the best at its, and also to meet customer request, the barriers that were lifted caused them to fall behind their competitors, at SIL the management realized the need to meet its vision, and this was only possible if information technology (IT) was implemented.

First Steps

At SIL, in order to achieve its purpose, the management had to take the first step if their goal was to be meet. The first step carried out by the management was to integrate IT into the organization business, also the management recruited an Information Systems (IS) manager, and an integrated package was developed within the company. These steps were very important in the adoption of IT at SIL.

Resistance

Resistance is common when change takes place,'' resistance is commonly considered to be a standard or even natural reaction to organizational change'' (Gravenhorst, 2003). At SIL there was no exception, lots of junior employees resisted the change, they believed IT had no part in the organization, most of the junior staffs saw the implementation of IT as a threat to their job. It was therefore an uphill task getting them to accept the change.

DEALING WITH RESISTANCE AT SIL:

In dealing with resistance at SIL, the IS specialist had to first of all change the management view of IT, a tougher task was to make the junior employees realize the benefit of IT, According to Giangreco (2000) resistance to change always have a negative perception, but there are ways to reduce it. At SIL an application was decided upon which was designed by the IS department. The head of each concerned department would make himself personally accountable for implementation and use of that system, in a case were two department were affected, the head of each department coordinated with one another, this lead to the use of IT in each department. The IS department also trained the junior staffs and technical problem were handled by the IS department. From the strategy the department used, we see that training can be used to overcome resistance; the Managers must also be willing to assist the employees if a change is to be successful.

MANAGEMENT INVOLVEMENT AND COMMITMENT:

Organizational change is more likely to be successful when key management people initiate or support the change. At (SIL) the management initially did not support the adoption of IT, but when they realized the importance of IT in their business they showed a great interest. The recruitment of the IS manager in 1995 showed the management involvement to implement change. The Management also showed great support to the IS Manager, by ensuring there was sufficient funds for the implementation of the IT plan. In addition the system manager was given sufficient authority for IT by the management (bottom-up). The commitment of management in the adoption of IT motivated the IT staffs.

NEW ORGANIZATIONAL STRUCTURE AND PROCESSES:

New organizational structure and process was being created due to the introduction of IT at the organization, according to the case study the adoption of IT into the organization and the emergent of the new Information System (IS) professionals help them deal with the new process. The new staffs changed the way tasks were done in the organization; Tasks that were previously done manually started getting done automated. Although not stated in the case analysis, downsizing took place in the organization, and this was to the benefit of the organization.

CONCLUSION:

In conclusion, this paper highlights the factors behind implementing change successfully in an organization with the use of Sunrise Industry Limited as case study. ''When implementing change, management need to be aware that personal issues can impact on employee's thoughts and behavior'' (Bovey, 2001).Management at any level need to get the employees involved in any change process because they are the once the change will affect. The success factors of adopting information technology (IT) has been identified in this paper. Management also need to be aware of the benefit of IT, in other to remain competitive, SIL had to adopt IT into their business process. The top management realized that IT had a big part to play if they were to compete in the hydraulic industry. The recruitment of the IS professionals was a key factor in the adoption of IT. In any organization Information Technology as a big role to play if the organization is to remain successful and competitive.

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