Organizational Change

Organizational Change : Meaning, definition, nature and types

Organizational change is a gradual modification of an organization from the existing state to the intended state. The change may be in different elements of the organization like technology, culture, strategy, etc. There are different types of organizational changes. If you are interested to become a manager, you have to learn more about what a manager does. In this article, we are going to discuss meaning, definition, nature and types of organizational change.

What is Planned Change and Unplanned Change? When it comes to a planned change, the organization may have been preparing for it for many years. And the unplanned change may not be anticipated by the organization.

Reasons for change:– Expansion of the organization, merger, acquisition, implementing new organizational culture, following a new marketing strategy, determining new vision and mission by the organization, etc.

Organizational Change : Meaning, definition, types

Definition of Organizational Change

‘Change is something that should be embraced rather than feared.’

According to Cambridge Dictionary,

“Organizational change is a process in which a large company or organization changes its working methods or aims, for example in order to develop and deal with new situation or markets.” 

"Organizational Change : Meaning, definition, nature and types"

Nature of Organizational Change

Ø The alteration of work environment in organization. The term organizational change refers to physical, biological or social alteration in a system.

Ø It implies a new equilibrium between different components of the organization like technology, structural, arrangement, job design and people.

Ø Any change may affect the whole organization; some parts of the organization may affect more, others less. Some elements are affected directly, some are indirectly.

Ø Some changes of minor type may be absorbed by the existing equilibrium; others of major type may require special change efforts.

Types of Organizational Change

There are different types of changes that an organization implements. The following are a few of the common types of changes in the organization:-

1. Strategic Transformational Change

Strategic transformational change involves significant alterations in the organization’s existing state of affairs. It affects the entire organization, unlike other changes.

E.g. change the way it transacts with customers, changing the organization’s mission and vision, change in implementation of automation, change in marketing strategy.

2. Reactive Change

Reactive changes are the ones that happen as a reaction to specific events. This event impacts the entire organization. Reactive change is not an anticipated event; therefore, the organization is not prepared for it in advance.

In a financial crisis, cost-cutting is a common reaction adopted by organizations. The recent outbreak of Coronavirus mandates every organization to wear masks and apply hand sanitizers.

Organizational Change

3. People-centric organizational change

This change is related to the employees in the organization. It will affect the employees differently. If employees are not notified, then expect an emotional outbreak from them.

For example:-

a.     Hiring new members or employees.

b.     Change in existing for the size of the organization.

c.      Incorporating four/five day work week.

4. Incremental change

Incremental changes are made slowly and gradually to incorporate large changes over time. Initiated at the unit level and slowly adapted to the entire organization. There is an objective to incorporate significant changes in the organization.

E.g. Incorporation of new software for tallying finances.

5. Structural Change

These changes are performed on the team hierarchy. Restructuring the company or making the designations all through the organization. Reason for implementing structural change is mergers and acquisitions.

E.g. the existing designations of Finance manager, Finance auditor are changed to Accounts manager, Accounts auditor.

In expansion phase, the company increases the staff and specializes in the current department personnel’s functions.

6. Total Change

Total change involves change on a large scale. Change in vision, other strategies, employees morale, business occur total change. It happens when the realities do not match expectations. The organization forms a new vision that is in sync with the existing requirements of the company.

 It is depend on organization as to which change to implement.

The adoption of a change strategy is triggered by the needs.

The type of change selected should be applied carefully.

Organizations should be prepared to deal with occasional employee outbursts.

It should deal with reactions before they are aggravated.