1 OBLIGATORISK FORSIDE Prescribed front page HJEMMEOPGAVER, PROJEKTER, SYNOPSER U/ MUNDTLIGT FORSVAR Home Assignments, Project Reports, Synopses without oral defence INSTITUT FOR ERHVERVSKOMMUNIKATION Department of Business Communication STUDIENUMMER Student No. HOLD NR.: Class No. Ex.: U and Bachelor Thesis FAGETS NAVN: Course/Exam Title Bachelor Thesis VEJLEDER: Name of Supervisor Sae Oshima ANTAL TYPEENHEDER I DIN BESVARELSE (ekskl. blanktegn): Number of Characters in your Assignment (exclusive of blanks): Ved skriftlige gruppeopgaver skal den enkelte deltagers bidrag tydeligt fremgå. In written group exams, your individual contribution must be clearly identifiable. Page 1 of 95
2 Change Management from Within: A Discussion of Communication in Change Management A Case Study of OKQ8 Authors: Carina Tommerup & Michelle Hemmingsen Supervisor: Sae Oshima Total number of characters (excl. spaces): Date: May 5 th 2015 BA in Marketing and Management Communication Aarhus University, Business and Social Sciences Page 2 of 95
3 Summary Change management has become an integral part of businesses in today s world. All aspects of an organization are open for change, as change today is more than just part of organizations natural life cycle, rather it is a strategic tool to increase competitiveness. For that reason, change management is now a field which must be ascribed an increased focus from scholars. Changes come in many forms and can bear on everything from administration to products and services and organizational structure. Some theories and researchers have acknowledged the fact that communication and change are connected, and models have been developed to show this interconnection. This thesis will therefore seek to get an insight into the concept of change management from a communication perspective. The thesis will present different views upon change management and the role of communication in change. Consequently, the purpose of the thesis is to discuss the role of communication in two different types of changes. In order to gain a necessary and realistic insight into an organization s perspective, a case study of the international company Q8 is applied. Taking its point of departure in the human resources approach, this thesis believes that inclusion and welfare of an organization s people, are key to organizational success. In developing its approach to change management, this thesis adopts a social constructionist perspective. This perspective emphasizes that reality is not naturally given, but is socially constructed by its members. This idea is also adopted in the conceptualization of change management, which is considered an issue of appropriate communication among an organization and its stakeholders, who in this case are the employees. The thesis applies a qualitative methodological approach consisting of a narrative analysis based on three in-depth interviews. The empirical data gathered through these methods provide an insight into change management from the perspective of Q8. The findings of the study indicate that Q8 applies a rather prescriptive approach to the management of the relocation and the merger, where alterations during the process have been almost non-existing. It is discovered that the communication was planned by the top management and shaped for the employees, however, the amount and content of the communication were not sufficient to provide the best possible preconditions for successful changes. The findings further indicate that communication possesses a Page 3 of 95
4 big role in successful change management. However, communication in itself is not enough, rather the communication must be adapted to the context and stakeholders of the change. The findings and discussion of this thesis are specifically based on one case study and related to the change management in Q8. However, this thesis is still applicable as an illustrative example of what role communication should possess in change management. In addition to presenting a real life case of how a strategic change is managed, the thesis provides a practical example of what some of the consequences of change are from the point of view of the employees. The findings from this thesis adds to the debate of communication in change management and change as an iterative process, both a theoretical and an academic discussion, as well as a practical perspective of the evolving concept of change management. Total no. of characters excl. blanks: Page 4 of 95
5 Table of Contents Summary Introduction (Carina & Michelle) Scientific Theoretical Approach Problem Statement Limitations of the Study Presentation of Q Structure Methodology (Michelle) Presentation of the Case Collection of Data Analysis of data Literature Review (Carina) The Field of Change Management Dimensions of change Change as a Process Obstacles Arising from Change Managing Obstacles Arising from Change A Narrative Analysis (Carina & Michelle) Account of Events (Michelle) Information about the Relocation (Michelle) The merger (Carina) The Relocation and the new Culture (Michelle) Adjusting to the new Organization (Carina) Sub Conclusion One (Carina) Analysis of Interactional Context (Michelle) Page 5 of 95
6 4.2.1 What Were the Social and Cultural Contextual Elements Affecting the Understanding of the Changes? (Michelle) How was the Communication Perceived and Evaluated? (Carina) What were the Consequences of the Changes? (Michelle) Sub Conclusion Two (Carina) Discussion (Carina & Michelle) A Model of Change-Related Communication (Carina) A Contextual Perspective: Dimensions of Change (Michelle) An Evaluative Perspective (Michelle) Future Research (Carina) Conclusion (Carina & Michelle) Bibliography Appendices Appendix 1: Interviews with Four Employees Appendix 2: Case Description Appendix 3: Interview with the former Scandinavian Head of HR Appendix 4: The Narrative Research Process Appendix 5: A Model of Change-related Communication Page 6 of 95
7 1. Introduction (Carina & Michelle) We live in a dynamic world where various kinds of changes happen all the time. This means that organizations exist in ever-developing environments where changes, whether technological, administrative, strategic, unplanned, major, or minor, are crucial in order to stay competitive and meet stakeholder demands. The message among experts and researchers has become clear: change is unavoidable. As stated by Kotter (1998: 27) No organization today - large or small, local or global - is immune to change. If you get stuck in the same particular ways of thinking and acting, you will not survive as a company (Miller, 2012: 174). Terms such as innovation, research and development, and organizational change are becoming more and more common in the vocabulary of organizations - even in that of consumers. The constant need and urge to adapt and renew products as well as procedures, result in many organizations following a curve constantly moving up and down between stability and instability. Several models of organizational life cycles and planned change are developed, and the consequences of change are receiving an increased level of attention among business practitioners and researchers (Miller, 2012: 175). Consequently, many organizational practitioners are concerned with ways of managing change instead of simply letting things happen (Miller, 2012: 175), which has led to the development of several models for managing change. Complementary to how change is managed step by step, two themes in particular receive much attention when speaking of change management, namely obstacles arising from change and criteria for successful change. Organizations consist of people, and these people are constantly exposed to changes and consequences following from them. As humans, we tend to feel most comfortable in stable surroundings, thus experiencing both physical and cultural changes impact the welfare of people in organizations. There is no finite answer to what constitute successful change besides improving one or more conditions for the organization (Cheney et al., 2010). However, by adopting a human resources perspective, this thesis emphasizes that in addition to the practical and financial aspects of change, change management is about the welfare of organizational members. In this regard, it is argued that successful change is also a matter of maintaining employees and keeping them satisfied in the workplace. As communication scholars, we argue that no model for managing change will lead to a successful change if communication does not take an integral part of it. On this Page 7 of 95
8 background, the subject of this thesis is communication in change management, since it is argued that successful strategic change and organizational welfare is unattainable without planned communication. 1.1 Scientific Theoretical Approach The scientific theoretical approach is the systematical approach to how knowledge is acquired and applied. This thesis works from a social constructionist perspective where reality is seen as constructed, rather than naturally given (Alvesson and Sköldberg, 2009: 24). Our conception is based on the idea that reality is formed by what we say, do and think. This means that reality is not independent from social practices, but something we as humans create together. The ontology of social constructionism is concerned with constructing a social or physical reality (Alvesson and Sköldberg, 2009: 24). Hereby, it is demonstrated how reality is perceived. On the epistemological level, this thesis will investigate the reality of this particular case, and how is it constructed. The methodology will be presented in section 3 and elaborates what tools and methods will be applied in this study. Based on this, the subject of change is considered to be socially constructed in its given context and by the participants in the change. The data we work with is created in a socially constructed reality, and this reality is considered the individual s expectations and interpretations - in this case the individual in proportion to Q8 and the two changes. Following a social constructionist point of view, reality consist of and is shaped by individual s different viewpoints, and this is also the case for how the changes in Q8 were subjectively perceived. On this background, this thesis set out to acquire socially constructed knowledge and hereby clarify individuals perceptions of the organizational changes in Q Problem Statement The purpose of this thesis is to investigate the role of communication in two different change processes through an analysis of the internal communication and management of change within a company during an office relocation and merger. Page 8 of 95
9 In order to provide an insider perspective, this thesis is based on a case study of the Danish department of the Kuwait oil company Q8. From a social constructionist perspective, providing an insider perspective give us the opportunity to collect individual perceptions of two real life changes which can help us understand some of the impacts change have on people. Furthermore, this perspective and understanding allow us to apply theory in practice in order to back up, or disconfirm the importance of communication in change management. Additionally, this particular case study consists of two changes, allowing us to compare the role of communication in two different change situations. In connection to the problem statement, the thesis will investigate the following two research questions in order to provide a thorough solution to the general problem statement: How are the dimensions of change reflected in the way the physical and cultural change are treated by the management? How do the employees perceive the communication of the physical change and the cultural change? And does this differ from the management s perspective? 1.3 Limitations of the Study Although the thesis has been well prepared, the study possesses some limitations due to the scope and timing of this thesis. First, the case under study took its outset in 2008 and was completed long before this study was planned. This means that it has not been optional to interview employees prior to the two changes. Consequently, some of the findings in this study is based on assumptions. Secondly, the interviews providing the main part of the data have been limited to four out of 200 employees, which means that many employees perspectives are naturally lost. Part of the data has been provided by the former Scandinavian Head of HR, who was part of the top management in the decision process. This data and the correspondence provided some statements from the top management, however, it has not been possible to interview the members of the top management and gather their perspectives on the changes and strategies. For this reason, the findings and assumptions rely heavily on what the employees shared in the interviews. Page 9 of 95
10 1.4 Presentation of Q8 The company Q8 operates in the energy and service sector, and was originally established under the name Kuwait Petroleum International in 1983 by the parent company, Kuwait Petroleum Corporation with the purpose of managing the company interests outside Kuwait. The company grew rapidly across the European service station market with the acquisition of Gulf Oil s operations in Denmark, Sweden, The Benelux, Italy and later BP s operations in Denmark and Luxembourg. Later on, Q8 expanded to the Spanish market, and meanwhile strengthened the company s position on the Italian market through the joint venture with the oil company AGIP. Q8 continued to expand across Europe, and in 1998 a joint venture with OKF in Sweden made OKQ8 one of the leading service station networks on the Swedish market. Today Q8 operates over 4,000 service stations across Europe and is expanding the market to the Far East (Q8, 2015). Kuwait Petroleum Corporation is recognized as one of the world s top ten energy conglomerates. The company refines and markets fuel and lubricants outside Kuwait, but the business also encompass the activities of marketing, sales, research and refining of petroleum products. Q8 was the first company to launch unleaded fuel in the European market, and since then Q8 has continued to develop and introduce several innovative and environmentally friendly initiatives. These initiatives reflect the values of Q8 as being original, innovative and modern. Q8 operates to fully exploit the company strengths by finding long-term solutions and develop the company on existing and new attractive markets. These values and objectives form the basis for Q8 s financial and innovative decisions, as the company wishes to maintain its competitive edge (Q8, 2015). 1.5 Structure Following the introduction, the methodology of the thesis will be presented. After this, the thesis will commence its literature review which will present the theory that lay the foundation for the analysis by defining the researchers point of view on change management and theory related to the subject based on a social constructionist perspective. Subsequently, the methodology section provides an overview of the specific case and methods applied in the thesis, namely the approach applied to discover what we wish to discover from this thesis. Next, the paper reaches its analysis Page 10 of 95
11 which consists of a narrative analysis. From this follows a discussion of the results and how they complement the theory and the researchers perspective. Additionally, it provides suggestions for what could have been done differently in these types of changes and suggestions for further research. The thesis ends with a conclusion summing up the findings of the thesis and how they contribute to the field of change management. 2. Methodology (Michelle) 2.1 Presentation of the Case The following case study presents two changes within Q8, which are both categorized as strategic changes. The case that form the basis for this thesis took its outset in Q8 s headquarters in Denmark was located in Birkerød, Nordsjælland from year 2000 to Q8 Denmark holds approximately 1,800 employees (Q8, 2015), whereas 200 of these are located in the headquarters and were affected by the change. Due to streamlining and outsourcing the organization had by 2008 reduced its number of employees by 33% from counting 300 employees in 2000, to counting 200 employees in For this reason, the location in Birkerød had become too big for Q8 and the remaining employees, since the office was constructed in a way that made it difficult to rent out parts of it to other parties. In 2009 the management informed the organization about the possibility of a merger with OKQ8 in Sweden, and in continuation of this the employees were told that it would be necessary to relocate the offices no matter what, due to too much space and high rental expenses. The employees were also informed that if OK and Q8 did not come to an agreement about a merger, consequently, Q8 Denmark would have to seek other initiatives to increase their competitiveness. The original recommendations from external consultants was to place the new offices in Malmö, Sweden, if the merger was to happen, but the management was awaiting to see if the merger would become a reality before looking into new locations. Due to the uncertainty, and in order to maintain as many Page 11 of 95
12 employees as possible, it was communicated to employees that the company wanted to be closer to the airport and Øresundsbroen connecting Sweden and Denmark. In 2012 it was agreed to carry out the merger and the choice of locations was to be made between Malmö, Sweden and Ørestaden, Denmark. When the agreement of the merger was communicated, many concerns for resignations occurred. Subsequently, came concerns about the location of the new office. The majority of employees lived in Nordsjælland and Copenhagen, thus they did not want to work in Sweden due to the transportation time and partly because the employees could lose their right to redundancy pay. Once it was revealed that the new offices would be located in Ørestaden, the concerns turned to revolve around parking options and foods and drinks at the new place. In May 2014 Q8 Denmark relocated to the new offices in Ørestaden. During the process, management established Trivselsudvalget, a committee that was to secure the thriving and welfare of employees through listening and referring back to the Scandinavian Head of HR. The goal of the committee was thus, to address rumors and worries right away. According to the management, this task was successfully completed. The management explains that during the entire process, our focus has been communication and employee welfare. and The focus of concerns among employees changes fast in situations like these. We have succeeded in maintaining a low rate of illness, few changes in staff, and we have actually increased the employee satisfaction during the process. (Statements by the former Scandinavian Head of HR; see appendix 2). Besides understanding the particular company case, the authors of this thesis argue that it is further necessary to understand the company on a more general level. As it appears in appendix 3, the strategic management (Lynch, 2012) of Q8 is primarily prescriptive 1. The overall goals, decisions and strategies are formulated in advance with general procedures and guidelines that must always be pre-approved by the owners of the organization. However, further specifics of strategies and 1 A prescriptive strategy is one where the objective has been defined in advance and the main elements have been developed before the strategy commences (Lynch 2012: 35) Page 12 of 95
13 tactics are developed during each project, which indicates a more emergent 2 approach. Therefore, the strategic management of Q8 is mainly prescriptive, but contains emergent features as well. The case possesses two different changes that are interconnected, them being the relocation of offices from Birkerød to Ørestaden, and the merger of the Danish Q8 and the Swedish OK, why the case provides a great case for studying the role of management and communication in a strategic change process. 2.2 Collection of Data As previously stated, this thesis works within the social constructionist view; it adopts a worldview in which meaning and reality is socially constructed (Alvesson and Sköldberg, 2009). The internal reality of what happens within the organization is thus, seen as socially constructed by its members. In order to analyze the consequences and importance of internal communication during an organizational change process, this thesis has chosen to analyze the process of change and managerial strategies that relate to communication in a case study of the Kuwait petroleum company, Q8. The case study provides the necessary insight into the choices of various aspects of communication during the organizational change process within the Danish Q8 department. It is based on qualitative research, which consists of two in-depth interviews with third line managers and one group interview with the head of Trivselsudvalget and the main contact person for employees during the change. Following the social constructionist idea that reality is not naturally given and that pure rational and objective knowledge does not exist (Alvesson and Sköldberg, 2009), the thesis further applies a narrative analysis to discover the socially constructed reality of this particular case. The case description was received per from an inside contact of Q8, the former Scandinavian Head of HR. Besides the case description, the material consisted of nine documents about the moving process and additional considerations about the relocation and merger. This was supplemented by online information from the corporate website, and 2 Emergent strategic management is a strategy whose final objective is unclear and whose elements are developed during the course of its life, as the strategy proceeds (Lynch 2012: 40) Page 13 of 95
14 under the headlines About Us. We emphasize that all interviewees in this paper will be kept anonymous and therefore referred to by the titles Employee 1, 2, 3 and 4. Moreover, applying Lynch s (2012: 574) categories of people involved in a change process, the employees will be referred to as change implementers 3 and change recipients 4 respectively, and the top management will be referred to as change strategists 5. The interviews were conducted at Q8 s facilities in Ørestaden after correspondence with Employee 1, the Manager of Strategic Purchase, who functioned as a change implementer. She was responsible for different practicalities and in contact with both employees and the management. Employee 1 mediated the contact to Employee 2, 3 and 4. Employee 2 was the head of Trivselsudvalget and also functioned as a change implementer. Employee 3, the Key Account Manager and Employee 4, the Logistics Manager are both categorized as change recipients. It was chosen to conduct face-to-face interviews with all four employees to reduce the risks of misunderstanding, and allowed for a flexible environment with room for elaboration and further explanation (Daymon, 2011). Two oneon-one interviews were conducted: one with Employee 3 and one with Employee 4. Additionally, one small group interview was conducted with Employee 1 and 2. Each interview lasted approximately 25 minutes. It was decided to conduct the interviews in this manner in order to receive the perspective of the employees who were the change recipients in the process, Employee 3 and 4, and of the employees who were the change implementers, functioning as links between the decision makers, the change strategists, and the change recipients. In this manner, the data provides two different perspectives for analysis and discussion in this thesis. The interviews were conducted in Danish as this is the native language of all parts and thus, allows for more natural answers (Eriksson and Kovalainen, 2011: 80). The interviews were recorded to ensure accuracy in the transcription (see appendix 1). The interview material has been translated into English in order to be applied as evidence in the analysis. The interviews consisted of six main questions and some sub questions. The interviews were guided, semi-structured and open-ended (Eriksson and Kovalainen, 2011: 82) in order to cover the necessary topics, while keeping the conversation informal. During the interviews, we adapted our questions to what made sense 3 Those who have direct responsibility for change management (Lynch, 2012: 574) 4 Those who receive the change program with varying degrees of anxiety, depending on the nature of the change and how it is presented (Lynch, 2012: 574) 5 Those responsible for leading strategic change in the organization (Lynch, 2012: 574) Page 14 of 95
15 following the previous answer. Due to this flexibility, the structure of the three interviews differ from what was planned in advance, as is evident from the appendix. Employee 3 and Employee 4 were given the same questions which differed slightly from the questions given Employee 1 and Employee 2 due to their roles in the organization during the changes. All four employees were firstly asked to simply state their role in the company and during the change. Secondly, they were asked to share their personal experience of the overall change process. Following this, the questions took form according to what the interviewees told us. The interviews were conducted by the authors of this thesis, who took an integral active part in the interviews making them conversation like. For this reason, the authors will be referred to as we during the analysis of the narratives and in the discussion. Data from the interviews and the group interview can be seen in appendix 1. The method of qualitative analysis was chosen as it provides an understanding of the role of communication in change management through the real-case example of Q8. The qualitative method allows researchers to analyze how Q8 has used communication in the change process through the conduction of a narrative analysis of empirical data. The thesis does not only wish to state the tangible communication efforts, but it seeks to analyze, interpret and discuss the underlying perceptions of the change process by employees of Q8. On this background, the qualitative method is a method for providing an authentic look into the reality of the change process as seen through the eyes of four Q8 employees (Eriksson and Kovalainen, 2011). The indepth interviews provide a private setting for the employees to share information openly and honestly, which will give the researchers explanations about the situation that are as authentic and honest as possible. The interviews complement the case material, thus in this manner, both sides of the story are provided for the analysis and discussion. As the authors of this thesis approach the issue of change management through a social constructionist view, and wishes to understand the role of communication through a narrative analysis, the qualitative research was deemed the most appropriate method. Page 15 of 95
16 2.3 Analysis of data The data received from Q8 and the interview transcriptions have been analyzed and interpreted through a narrative analysis, in order to discuss Q8 s use of communication in their management of change. This analysis leads to a general discussion of the role of communication in change management and subsequently, an evaluation of the choices that the management of Q8 has made during the organizational change process. The narrative analysis is based on empirical data gathered and organized by the researchers. Empirical data can take various forms, and for this analysis, the primary form is that of narrative interviews and conversations (Eriksson and Kovalainen, 2011: 215). As previously stated, the researchers of this thesis have conducted two in-depth interviews and one in-depth group interview, which all take the form of narrative interviews. The ontological perspective of narratives holds that the world consist of stories, and the epistemological perspective states that we get to know the world through stories, making this research method appropriate from a social constructionist point of view. In this thesis, narrative analysis is employed as an analytic method, thus different narrative tools are applied when analyzing the text gathered from the employee interviews. The narrative analysis is conducted in accordance with the narrative research process (Czarniawska, 2004 in Johansen, 2014: 8), which is available in appendix 4. Firstly, we have collected the stories through interviews in which we sought to incite storytelling. Ensuing, we have interpreted and analyzed the stories in order to deconstruct them and put together our own story. Various theorists emphasize the fact that we as human beings are storytellers by nature (Simmons, 2006: 30; Eriksson and Kovalainen, 2011: 211). Sharing this point of view, this thesis utilizes the narrative analysis to uncover the reality as experienced by the employees of Q8 during the change process, based on the argument that...narrative is one of the fundamental means by which we organize, explain and understand our life and social relations (Eriksson and Kovalainen, 2011: 211). According to Berger and Luckmann (Eriksson and Kovalainen, 2011: 210) narrative analysis is a research approach rooted in social constructionism. Following Jerome Bruner s line of thought, narrative is a way of knowing (Eriksson and Kovalainen, 2011: 210; Johansen, 2014: 5). In accordance to this idea of narrative knowing, our analysis builds on the conception that all oral and written texts and language practices should be acknowledged in the construction and Page 16 of 95
17 understanding of reality. According to Bryman (Bryman, 2012 in Johansen, 2014: 2) narrative analysis is an approach to the analysis of qualitative data that emphasizes the stories that people employ to account for events. Therefore, when performing narrative analysis we seek to organize, interpret and discuss the empirical data gathered, which describe some more or less consistent events, happenings and actions in a manner that construct narratives (Eriksson and Kovalainen, 2011: 217). In this thesis, the narrative analysis is used to explore how employees make sense of organizational change processes (Søderberg, 2006 in Johansen, 2014: 6). Story and narrative are some of the core concepts of narrative research (Eriksson and Kovalainen, 2011: 211), so in order to carry on, we need to define what stories and narratives are. Some narrative researchers find that it is necessary to distinguish between the two terms. In this case, a story is defined as a piece of fiction that narrates a chain of related events or happenings that involve certain characters (Eriksson and Kovalainen, 2011: 211). A narrative on the other hand, is the textual actualization of a story at a specific time and context, and to a specific audience (Eriksson and Kovalainen, 2011: 212). Following these two definitions, a narrative is a story told in a specific way by a narrator. Some researchers on the other hand, use the terms narrative and story interchangeably, although they can have different definitions. For example, Denning (2011: 13) states that " narrative and story are used as synonyms, in a broad sense of an account of a set of events that are causally related." and Czarniawska (Czarniawska, 2004 in Johansen, 2014: 10) says that a narrative is understood as a spoken or written text given an account of an event/action or series of events/actions, chronologically connected. Furthermore, Simmons (2006: 31) claims that Basically, a story is a narrative account of an event or events - true or fictional. This thesis considers the definition by Simmons to be the most appropriate one, as we claim that a story does not need to be fictional. Nevertheless, following Denning s (2011: 14) considerations that "Story in its external aspect is something to be observed, analyzed and dissected into its component parts. In its internal aspect, it is something that is experienced, lived as a participant.", we have gathered stories lived and told by employees at Q8 and transformed them into text, why we will from here on refer to them as narratives rather than stories. Page 17 of 95
18 3. Literature Review (Carina) 3.1 The Field of Change Management As previously mentioned, organizations thriving in today s world acknowledge that change is required to stay competitive - this is supported by Lynch (2012: 551), who claims: Strategic management invariably involves change for people working in organizations. The field of change management has attracted the attention of an increased number of scholars and organizations during a short period of time, as Kotter (1998: 27) states: No organization today - large or small, local or global - is immune to change. By studying literature on this subject, it becomes evident that a great number of scholars equals a great number of different definitions of change management. Working from a social constructionist view, this thesis adopts the definition from Cheney et al. (2010: 325), which states that "...change is the process by which alteration occurs in the structure and function of a social system". In order to grasp the wide field of research included in this definition, it is required to look deeper into the research by Cheney et al. (2010) and others. As the perception of what change encompasses varies from individual to individual, as well as from organization to organization, it can be concluded that change is a polysemous term - it has multiple meanings (Cheney et al. 2010: ). Additionally, Miller (2012: 173) claims that there is nothing as constant as change. These two considerations alone explain why many find the subject of change management interesting and necessary to study. One way of viewing change is to take its opposite into consideration that being constancy, permanence or stability. The dialectic view alludes to both ends of the continuum as desirable, yet the opposites counteract each other. The more we work for change, the less stable the situation, and vice versa. However, the two concepts are interdependent, as one of them cannot exist without the other. In other words, change only makes sense on the basis of stability, and from an organizational perspective this inevitably means that change must be followed by stabilization and new routines within the organization (Cheney et al. 2010: 326). Looking back in time, the above claims by Kotter and Miller support the historical context of change. Organizational practices and organizational wisdom have had various attitudes and assumptions towards change, however the role of change has shifted, which brought the focus to Page 18 of 95
19 open systems theory and scientific management (Cheney et al., 2010: 327). Scientific management considers change as a tool to develop efficient routines with the goal of stability and routine, while open systems theory assumes that an organization is part of a continuously changing environment with a constant flow of feedback used for adaptations. However, open systems theory still believes that an organization should strive for stability and routine as the preferred result. Though the theories hold different perspectives on change and adaption to the external environment in which it exists, one thing is clear: change is not celebrated in either of them. This was the case up until the marketing concept entered the field (Cheney et al., 2010: 327). This concept favors a high degree of flexibility, as it argues that only a flexible organization will manage to respond to the changing consumer demands and needs. Still, change is not a favorite among organizations (Cheney et al. 2010: ). The 1970 s mark a turning point in the view upon change. From this point in time and onwards, trends such as total quality management and customer relationship management stole the focus, providing the key ingredient for success, namely constant change. The most constant part of total quality management is the structures facilitating the changes. Nevertheless, what is made clear by the presentation of theories and perspectives on change is that a constant push and pull tension between constancy and change exists. The poles, or ends of the continuum, are valued simultaneously but not necessarily equally. This brief review of the field and history of change management demonstrates that what is considered important in situations of change and change management varies from perspective to perspective. Change is rarely something that happens automatically overnight, change is a process. Commonly, it is a planned process, but sometimes it is not. Two types of changes can occur in an organization: organizational and strategic change (Lynch, 2012: 564). An organizational change is one that happens as part of the organizational lifecycle, these are the changes that happen continuously. A strategic change, on the other hand, is a change that is planned with a strategic purpose in mind. Such a change represents a proactive search for new ways of working (Lynch, 2012: 564), which is, as stated above, what most organizations strive to do in order to stay competitive. Additionally, it is worth noticing that strategic changes can be seen through the eyes of both prescriptive and emergent theories (Lynch, 2012: 564). In prescriptive theories, changes are the actions that result from pursuing a chosen strategy (Lynch, 2012: 565). Following a prescriptive approach, change is likely to be imposed onto those who are to implement the change. In Page 19 of 95
20 emergent theories, change might mean the whole process of developing and deciding on a strategy and the actions that follow this strategy (Lynch, 2012: 565). If a company chooses to follow this strategy, it is likely to include experimentation, feedback and involvement of employees (Lynch, 2012: 565). Organizational and strategic change processes always affect one or more employees and stakeholders of a given organization as they involve people working in the organization (Lynch, 2012: 561). As humans are the building blocks of organizations, the human impacts and consequences of change should be carefully considered in a change process (Lynch, 2012: 561). To manage the impacts, and overcome obstacles, arising from change, more consultation, more explanation and more monitoring of reactions (Lynch, 2012: 566) should be involved in change management. Following this statement by Lynch (2012), the authors of this thesis see change management as an issue of communication, therefore the subject of change is investigated through the lenses of communication scholars. In accordance with consultation and explanation, communication is considered the primary key to successful change. However, following Cheney et al. (2010) and Lynch (2012), the context of the change affects the way the particular change should be managed, and consequently, the nature of the communication. Lynch (2012: 566) states: All this will depend on the context of the change - the culture of the organization, the way in which strategic change is introduced and the nature of the changes proposed. With this in mind, this thesis argues that communication in itself is not sufficient, it must be context-specific, which leads the literature review to the Dimensions of Change. 3.2 Dimensions of change As previously mentioned, the perception of what change is, varies across individuals and organizations. With this in mind, it makes sense to say that different changes vary across different situations. Within a single organization a great variety of changes can occur, and as Cheney et al. (2010: 333) state: To be effective in managing and coping with change, we need to understand what differentiates these kinds of changes. In other words, if effective change management is the goal, one cannot simply apply the same communication strategies and tactics to all changes happening in an organization. If this was the case, the communication aspect of change would be Page 20 of 95
21 rather simple to go about. To handle a change in the best possible way, the underlying dimensions should be taken into consideration. Seven dimensions have been identified (Cheney et al., 2010: 333) and will be explained below. The first dimension refers to magnitude, which is about whether a change is minor or major. A minor change is often rather simple, while a major change can be as great as restructuring an entire organization (Cheney et al., 2010: 333). A change can also be abrupt or gradual, depending on the type of change and the implementation strategy. To distinguish between changes, philosopher Gregory Bateson presented a continuum with first-order changes at one end and second order changes at the other end. First-order changes are made in order not to change. First-order changes can be juxtaposed to adjustments. Second-order changes are rather infrequent and have great impact on an organization. They change the organization fundamentally like a merger does. Importantly, one must notice that first- and second- order changes are the two extremes. Usually, a change lies somewhere in between the two poles (Cheney et al., 2010: 333). The second dimension is type or substance. Daft (Cheney et al., 2010: 334) argued that Changes can be technological, administrative, product or service related or within human resources, and Cheney et al. (2010: 334) added the category of image. Most often a change falls within more than one of the categories. Intentionality is a simple dimension. A change can be conscious, deliberate and planned, like most organizational changes are, or they can just happen. The latter are the changes that happen every day. Unplanned change sometimes become an organizational crisis, which can either be caused by internal or external factors (Cheney et al., 2010: 336). Next is the dimension of timing. Changes can be short-term, long-term, happen suddenly or gradually, be ongoing, or even evolutionary. The dimension of impetus relates to the source of the change. Changes can be initiated internally, or externally. In addition, it can originate from a central place in the organization by the strategic planners, or non-centrally from lower levels of the organization (Cheney et al., 2010: 336). Different change initiatives are received in different ways by different people, which is what the dimension of popularity is about. Stakeholders hold differing interests in an organization, why they are likely to react differently to changes (Cheney et al., 2010:336). The variety in attitudes towards changes makes it even more crucial to persuade stakeholders, both primary and secondary, that the change is the best solution. Cheney et al. (2010: 336) explain: Of course, a major task of change agents is to persuade stakeholders that the change is the right thing to do. However, that task is made much Page 21 of 95
22 easier or more difficult depending on stakeholders initial views. The last dimension is control, which encompasses different approaches. When a change is controlled and tightly managed by change strategists, who are often the top managers, it is a top-down or rule bound approach. In contrast, an adaptive implementation includes changes that may be initiated at all levels of the organization, this is also called bottom-up approach. Here members from all levels of the organization have the chance to exert influence over the process through their feedback (Cheney et al., 2010: 337). Another interesting perspective relating to change control is the framing of the change. Cheney et al. (2010: 337) say: there is symbolic value in claiming to use practices that are socially esteemed. Since change is often valued for itself, a manager can present herself as competent or cutting edge by claiming to be making radical changes. What is said here is that by framing a change as something extraordinary, a manager can exert an indirect control over the change. Below a table of the seven dimensions is provided. Establishing the dimensions of change is the pre-work to develop a communication strategy, the next part of the literature review will present two models of the actual change process. Cheney et al. s seven dimensions of change 3.3 Change as a Process Having established that change is context-specific, a matter of communication, and a process, it should be noted that so far two opposing types of change models have been developed: change as Page 22 of 95
23 a linear process and change as an iterative process. Following Kotter s (1998) Eight steps to transform your organization model, change is a rather linear process. The first step of the model is to establish a sense of urgency. Management must identify and discuss potential crises, current crises or major opportunities, while examining the market and the competitive relations in it. If the urgency concerning a change is lacking, and a change is merely presented through a report or a simple newsletter, there is a great chance that people will not commit to the cause of the change. Second, is to form a powerful guiding coalition, where the group supposed to manage the change initiative is consolidated, and starts working as a team to implement the change in the best possible way. Third, is to create a vision. A change must have a clear vision to appeal to the emotions of the employees. It helps direct the change effort and keep the end result in mind. Included in this step is to find the strategies to achieve this vision. Fourth, and not to forget is communicating the vision. Here the group of change agents assembled in step two must think of every possible media or vehicle that will be useful in communicating the vision and strategies. The guiding coalition must teach the new behaviors by example. The fifth step is where others are empowered to act on the vision by getting rid of obstacles to the change, and a change of systems and structures that will get in the way of the change vision. In addition, risk taking, activities, action and nontraditional ideas are encouraged and supported to make employees part of the change. Sixth is to plan for and create short-term wins. The focus here is to make the improvements from the change visible to the employees and reward those involved in these improvements. Moreover, the organization must plan for visible performance improvements and implement these. Step number seven holds a consolidation of the improvements and a continuous production of change. To do this, the increased credibility must be used to change systems, structures and policies that still exist, but do not match the vision. Also, employees who will promote and develop the change vision must be hired or promoted. Reenergizing the change with new projects, themes, activities and change agents is also part of this step. The last and eighth step is an institutionalization of the new approaches. Employees must be made aware of the connection between their new behavior and the success of the organization, while the means to ensure a continuous development of leadership and succession (Kotter, 1998: 29). Kotter (1998) works from the assumption that a change can be implemented successfully through a linear process. Although we do not reject the model by Kotter, we argue that it lacks the opportunity to go back and forth between the steps, because the model is Page 23 of 95
24 linear. Kotter does not include the possibility for alterations occurring by interactions among organizational members. The model does, however, possess steps that we consider necessary in a change process, and in this thesis, the element of communicating the vision will be included though the entire model is not applied. The second model introduced illuminates the perspective on change lacking in Kotter s model. It emphasizes that even if there are steps to follow, it is possible to go back and iterate what was done earlier in the process. Cheney et al. (2010: ) focus on the communication process, illustrating the correlation between change and communication. Though Cheney et al. (2010: 331) present change as a rather linear process in this specific model, it is not as simple as that. Instead the process has a feedback loop that allows for alterations to be made in previous steps, meaning that communication in previous phases of the model can at any time be reconsidered. This example shows that theorists often treat the process of change communication as a linear one, despite recognizing the fact that it is not the case. Quoting theorists Jeff and Laurie Ford, Cheney et al. (2010: 329) manage to get to the core of how communication and change is closely related: Change is a... process of social construction in which new realities are created, sustained, and modified in the process of communication. Producing intentional change, then, is a matter of deliberately bringing into existence, through communication, a new reality or set of social structures. In short, change happens as a consequence of people communicating. This represents the first communicative feature of the change process; change is caused by communication. Second, the author underlines the fact that change occurs in a social- historical context, as mentioned earlier. Changes are influenced by the specific context in which organizations exist. These contexts changes through time, and so does the view of change accordingly. The third feature of communicating changes refers to the bidirectional discourses. Managers gather information on new popular trends at present time through media such as books, conferences and discussions with others. At the same time, the changes done and implemented within an organization, are communicated to the external environment in a range of publications and research reports, while also being discussed by members of the organization with their external contacts. Fourth, is the importance of communication when implementing a planned change. A change must be communicated to the ones affected and involved. The way in which this communication is received influences the success of the change. The fifth feature of the model Page 24 of 95
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