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Master Thesis Cand.merc HRM Synnøve Holgersen

Mentor: Stine Staffeldt (external)

Research question:

Change Management Theories - is there an optimal way of

implementing change in an organisation, and how can this be seen in an intercultural perspective?

Problemformulering:

Endringsledelsesteorier - finnes det en optimal måte å implementere endring i en organisasjon, og hvordan blir dette sett på i et

interkulturelt perspektiv?

Copenhagen Business School Total number of pages: 79

January, 2011

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ABSTRACT

This text presents the different sciences related to change management – rationalism, functionalism and social constructivism, and with the basis of these three fundamentals, one has tried to identify ways that change can be implemented in an organisation. The aspect of culture has further been brought in to perspective, by looking at how theories of change and organisational development (OD) can be seen and implemented in the different national cultures. Are there some models which are better suited in some cultures, or is it one model that in general could be used in all organisations and / or cultures?

First one look at the reasons for change, where this may be due to planned change, as well as change as a coincidence, where one in the text focus on implementing change as a planned change. The basis of the analysis and discussion are functionalism and Kotter’s eight step model, together with the new and not quite finished research area of social constructivism and the Appreciative Inquiry (AI) model. The two different models are compared, and in the social constructivism one say that humans think, feel and see the things they want to see – hence some things are being taken into consideration in a process of change, while others are left out. This contributes to the fact that there is not only one reality, and that in the communities of practices, together one create meaning within the organisation. In a social constructivism approach this means that change does not happen and make sense until the change is negotiated and meaningful within the communities of practice. Functionalism looks at both the classic rational approach and the visionary approach, which emphasise on a more analytic approach; whereas Kotter’s eight step model and a linear approach are the basis for the implementation of change (Guldbrandsen, 2010).

The models used for comparison are Organisational Development (OD) and Total Quality Management (TQM), where an OD definition and model is used as material for the analysis and discussion. Further the TQM and quality programmes are themes which may be used as an example and key determinants for implementing change, with focus on quality throughout the change process. These are both models where a common goal is for the organisations to be more competitive, and where a strategic change could benefit the entire company by simple steps, concerning both a quality concept and a definition characteristic which departs substantially from a traditional approach.

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When relating these different theories of change and culture, one seek to explore if there is a best possible and optimal way for an organisation to handle and implement change at every level of the organisation, both on a short and long term basis. The main models of Kotter and the AI model, together with OD and TQM are reviewed and when looking at the different evaluations in this paper, it is difficult to see and explore which is the most optimal for implementing change, and consequently one may say that there is not only one way of doing it, or one culture that is better suited compared to the others. Suggestions are made when comparing change models and different cultural features, and evaluations are made, both concerning the comparison of the two main models, but also the comparisons related to OD and TQM, as well as involving the cultural aspect. One may presume that there does not exist only one optimal model for change, however,based on the discussion and analysis one have found, that this is something that depends on the entire situation as a whole. Something that works in one situation does not necessarily work in another organisation, and for that matter, another country. The findings of the text suggest that the choice of change model should be situational, where the organisation’s history, management style and what kind of change one has to deal with are important aspects to consider, before starting the process of change (Guldbrandsen, 2010). To have knowledge about this and the existing composition of cultures within the organisation, could be an important advice for the future, because then, one may be able to know and recognise what to do in specific situations involving change.

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Contents

ABSTRACT ... 2

1. INTRODUCTION ... 5

2. METHOD ... 6

2.1. Research question: ... 7

2.2. Research design and ontology ... 7

2.3. The three ”isms” ... 9

2.3.1. Rationalism ... 9

2.3.2. Functionalism ... 11

2.3.3. Social constructivism... 12

3. THEORETICAL FRAMEWORK ... 15

3.1. Types of change – what is the reason for change? ... 15

3.1.1. Planned change ... 15

3.1.2. Change as lifecycle ... 16

3.1.3. Change as evolution ... 17

3.1.4. Change as dialectic process and power battle ... 19

3.1.5. Change as contingency / coincidence ... 20

3.1.6. Different models – competitive or complementary? ... 22

3.2. The two main models ... 24

3.2.1. Kotter’s eight step model ... 24

3.2.2. The Appreciative Inquiry (AI) model ... 27

3.2.3. Change Management ... 28

3.3. Comparative models ... 31

3.3.1. Organisation Development and Change ... 31

3.3.2. Total Quality Management (TQM) ... 37

3.4. National cultures and demand of management ... 46

3.4.1. The four dimensions ... 48

3.4.2. Practical differences of culture - a Norwegian perspective. ... 54

4. ANALYSIS AND DISCUSSION ... 61

5. SUMMARY AND CONCLUSION ... 75

5.1. Further research ... 77

6. REFERENCES ... 78

6.1. Books and articles: ... 78

6.2. Internet sources: ... 79

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1. INTRODUCTION

Change can vary in complexity, from introducing relatively simple changes into a small work group to transforming most features of the total organisation, and although change management differs across situations, it is important to address some points that need to be performed when managing any kind of organisational change. Aspects like motivating change, creating a vision, developing political support, managing the transition and sustaining momentum, are some of the theories that needs be taken into consideration when implementing change (Cummins & Huse, 1989). The culture is seen as “the invisible web” in a society, and it is a prerequisite for theories to be valid and secure that behaviours such as managerial behaviours are effective, when managing change. As long as we are “in” the culture, there is a tendency where one may have troubles with discovering it, or taking it for granted. However if one try to manage and organise after one’s own well-known principles in an unknown and different social and cultural context, one may experience that some of the fundamentals one relies on, no longer are valid, and that one needs to open up one’s mind and use the differences to something that could benefit the entire organisation.

I start by looking at the sciences of change management, which both Kotter’s eight step model and the situational Appreciative Inquiry (AI) model are mentioned and based upon.

Rationalism is mentioned, but the main argument involves mostly functionalism and the theory of social constructivism. These are the sciences that the theories are based upon. The Further in the theoretical framework I examine the different reasons for change, whereas this is seen as the basis for understanding change, before one begin exploring the different change models and their applications. The main models are, as mentioned above, Kotter’s eight step model and the AI model. The models which they are compared with are the OD model and TQM. I finalize my theoretical framework with including culture and the four cultural dimensions of Hofstede, which also are the basis for analysis and discussion, together with the change theories mentioned above. The analysis looks at different change theories and different international cultures, to seek to find a correlation between change theories and cultures, and a possible optimal solution for implementing change.

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2. METHOD

Social science tries to understand and explain phenomenon’s that occurs. To give rich, well- informed and well-substantiated descriptions is one of the responsibilities of social science, as well as explaining and trying to understand how the human world is put together. The basis for science is the causal belief; meaning that one thing leads to another. The quantitative and qualitative approaches do not demand strong causal coherence. It explains the probability of a phenomenon occurring, and that some degree of regularity is present. The aim is to look for tendencies, regularities or correlations (Skog, 2005). The object of this chapter is to substantiate the chosen methods, and give an account for the rational, functional and social constructivist assumptions and theories, together with the more ontological assumptions and the theoretical basis and paradigm pragmatic constructivism.

First one may consider some general qualitative and quantitative theoretical assumptions, where these quantitative and qualitative ontological assumptions vary. Quantitative researchers isolate and define variables and variable categories to frame hypotheses.

Hypotheses are often produced before the data is collected, and are then tested upon the data.

Variables are the means of the analysis. It is often pictured like a researcher looking through a narrow lens, at a specific set of variables (Brannen, 1992). Quantitative method is according to Jacobsen (2005) and Skog (2005) mainly based on a deductive approach. Data collection is based on survey where different alternatives for an answer are given. The goal is to perform an affective statistical analysis, and present the results in enumerative analysis. The purpose is to find frequencies, and how many and what kind of people in general have the characteristic which has been found to exist in the sample population (Brannen, 1992). The object is to make connections or to reveal regularities between variables.

With qualitative research it is the concepts and categories that matter. One of the purposes is to test theory, and participate in analytic induction. Brannen claims that analytic induction, which often begins without a clear hypothesis, can be combined with deductive methods, and the testing of hypothesis. Qualitative researchers may begin with defining general concepts.

During the process of the research program the definitions may change. Variables constitute the product or outcome. The research is described as looking through a wide lens, searching for patterns of inter-relationships between a former unspecified set of concepts (Ibid.).

Qualitative method collects information often of a more interpretive and descriptive character.

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Interviews, group interviews, observation and documentary research are the main approaches (Blaikie, 2000; Jacobsen, 2005). Qualitative research can also be descriptive.

“Enumerative and analytic induction have different starting points therefore: enumerative induction abstracts by generalizing whereas analytic induction generalizes by abstracting”

(Brannen, 1992, p. 7).

Several schools discuss whether designs and methods should be mixed, combined or triangulated (Blaikie, 2000; Creswell, 1994; Ellefsen, 1998; Jacobsen, 2004; Morgan 1998).

Traditionally quantitative and qualitative research is seen to belong to different paradigms. It is assumed to be a connection between epistemology, theory and method.

2.1. Research question:

Change Management Theories – is there an optimal way of implementing change in an organisation, and how can this be seen in a intercultural perspective?

2.2. Research design and ontology

The object of this study is to complete an analysis of different change management theories compared to international cultures, and to look at how cultural similarities and differences relates to and accepts the different terms of change in an organisation. By answering this research question, our contribution is placed within the literature concerning voices in organisational fields, especially considering theories of change management and culture.

The paper is based on secondary data and literature, where other researchers and authors have made some distinctions of the different theories described in the paper. It is worth mentioning that not all of their theories and aspect have been used in this paper, only the terms that were seen as preferable in relation to the argumentations of the text. I have used Guldbrandsen`s paper ”Den fjerde isme” as a basis or fundamental for the theories concerning the implementation of change, the discussion and analysis, and also the summary and conclusion of this paper. The main arguments are based upon functionalism and social constructivism, whereas John Paul Kotter`s eight step model is one of the models, which are seen as a tool to understand and implement change. The models’ counterpart is the model within social constructivism and Appreciative Inquiry, the AI model. In comparison with these two models I have used OD and TQM, where Almaraz (1994) and French and Bell Jr. (1999) are used as empirical sources. The reason for choosing OD is the substantially difference from the

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traditional approach to implementing change, whereas this could be seen more similar to both Kotter`s model and the AI model. The TQM model or initiative is chosen due to wanting to explore further the aspect of quality as a way of implementing change. One can also mention that both models, OD and TQM, contains some perspectives on the behaviour of humans, when implementing change, and this is something that I, personally. Think is an aspect that is interesting, but also a crucial determinant to consider when handling change. Further I have used literature from known authors like Schein and Hofstede, where both of them are well known voices within cultural theory. I also choose to take an Norwegian perspective in the evaluations concerning cultures, and this is due to my own nationality, but also in the sense of looking at the Scandinavian countries like a unity, when comparing it to the other continents, countries and cultures that are mentioned in that section. In general one can say that most of the mentioned literature used in the paper, including books and articles – except for Guldbrandsen, are part of the curriculum in the master programme “Change Management” at the University of Stavanger, Norway, this is also one of the reasons for my choice of literature, however only to some degree. The following will represent the ontological assumptions used in this paper, whereas pragmatic constructivism is the practice paradigm involved.

In this paper a paradigm is taken to mean, a set of ontological and scientific assumptions that make up a framework within which knowledge can be obtained, acted upon, evaluated, and developed. It follows that a paradigm includes the basic presumptions made about the nature of our environment and our place within it. They are based on what we consider to be truth and knowledge and reflect on how these are obtained and used (Nørreklit, Nørreklit &

Mitchell, 2010). Not only do they reflect on how people behave and why they do so, but also why a particular behaviour is appropriate. A paradigm can be implicit or explicit. It is widely recognized that validity is determined by inter-relationships between the paradigmatic components of ontology and epistemology where certain ontological assumptions imply a particular epistemology with the task to safeguard the validity of our knowledge. In particular, the modern founder of the concept of scientific paradigm, Kuhn, points to a paradigm as a disciplinary matrix involving:

 Some general metaphysical assumptions about the composition of the field under consideration;

 Some general laws, principles and concepts for analyzing questions and presenting the

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results;

 Shared values of what forms the qualities of a scientific theory that are applied in the choice of competing theories/paradigms; and

 An exemplary result including artefact paradigms as the ideal norm to be transferable to other closely related problem areas.

Pragmatic constructivism is based on the thesis that four dimensions of reality must be integrated in the actor-world relation if the construct is to be successful as a basis for undertaking actions. These four dimensions are facts, possibilities, values and communication. The argument for the inclusion of these four dimensions and the relationships among them is as follows. Facts are necessary as a basis of action, whereas facts alone are insufficient. If there are no possibilities, there can be no action and if one has no possibilities then one is dead. The possibilities must be grounded in the facts, if not they are fictional.

Further, possibilities create room for choice, but they only function if there is a reason to choose and prefer one possibility to the other, hence if the actor has values and the values lie within the range of one’s possibilities. Finally, the integration of facts, possibilities and value must be expressed in communication in order to enable action in a social setting. If the integration of facts, possibilities, value and communication dissolves, then the ability to act intentionally breaks down because the distinction between true and false in the pragmatic sense, for example between successful and unsuccessful action, breaks down (Ibid.).

Further the paper will represent the quantitative and qualitative ontological assumptions, which the literature relies on.

2.3. The three ”isms”

2.3.1. Rationalism

The management theory and practice within change management has its roots in three schools or isms, where rationalism is the first one. Rationalism has its source from the metaphorical picture of an organisation as a goal-seeking machine and it the goal is to be as effective as possible considered the problem and the different solutions to the problem (Guldbrandsen, 2010). To execute this, the management has some structural and administrative measurements;

1. Organisational structure, which defines the different unit’s purposes, references and authority.

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2. Job descriptions, which connects the tasks and authority of the actual positions 3. Process descriptions, which describe the best way to execute the work

4. Explicit performance criteria, which makes the goals clear for the employees 5. Recruitment procedures ensuring the proper qualifications

6. Control, sanctions and reward, which ensures that structure, rules and procedures are being delivered

The rationalists recognize that there are irrationalities in the organisation, but these are meant to be reduced as much as possible because they are in the way of the optimum, which have been created by the existing order and structure. The aspect of rationalism can be expressed in the way rationalism relates to culture, where culture and cultural leadership are not very widespread. Instead they use norms to explain the irrationality that exist in the organisation and the term normative control to bring the irrationality under control and the means to control this is done by classic bureaucratic management and control (Ibid.).

The rationalist saw a change as something disturbing to the organisation and therefore the changes should be executed as fast as possible to recreate stability and efficiency. This should be done through a ”top-down” access and change management were, due to this, not seen as an important management discipline, but more as an opportunity to those management disciplines, which are connected to the ”normal” managerial optimization.

Later, a tendency which was called “planned change” rose within rationalism and behind this idea one can seek to find that a change should be planned and executed by a change agent, which often should be the senior manager or an external consultant. The change agents task is to secure that the necessary changes are carried out, which means that the organisation needs to adapt to the environmental changes outside the organisation (Ibid).

The theorist that contributed most to the development of the rationalistic view on planned change was Kurt Lewin. Lewin says that change occurs, when there appears a disturbance in the tension which ensures organisational stability and when the powers that ”wants” the change are stronger than the powers that seeks to maintain the already existing state. In the process of change, the change agent’s first task is to ensure that the change can happen by staggering the existing equilibrium, and the second assignment is to take initiative to ensure that the activities that are being done due to the change can ensure re-freezing around a new equilibrium. This is stated in Lewin’s tree-stage model for planned change and this model contradicts some of the other models for change management, where Lewin’s models is

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empirically grounded from World War 2, where he did a survey for the U.S. Government.

Even though Lewin’s model is more than 50 years old, can the linear and one-dimensional change strategy be seen as base for much organisational theory. For example the tree-phase model is seen as soundboard for Kotter’s eight step model, which we will look closer at later in the text. In organisational practice the models for planned change are still very popular today and many management practices take their impetus in rationalistic thoughts, where the change agent is seen as the most important actor for recreating order, with a ”top-down”

strategy, with structure, culture and systems as the primary areas of effort (Ibid.).

The second ”ism” is functionalism and has its roots in the system theories and is based upon the perception of that an organisation is a living organism, which needs to take care of four important functions to survive: Ensure access to the necessary resources from the environment - adaption, formulate and follow goals, coordinate activities – integration, and also maintain and adapt the mindset through the culture. To maintain, develop and coordinate the four important aspects described above the functionalism has developed a new management discipline; Strategic management, which is described as a process that consist of two separated steps: The formulation of the strategy and the implementation of the strategy.

Within functionalism there are two schools which have different permissions related to strategy and change management and the two will be further addresses below (Ibid.).

2.3.2. Functionalism

There are two approaches / models within functionalism, whereas the first one to be described is the classic rational approach and the second one, which is to be described later, is the visionary / ideological approach to strategic management (Guldbrandsen, 2010).

The classic rational approach to strategic management consists of a set of steps, where the first thing is to make some assumptions about the future and the strengths and weaknesses of the organisation, where a SWOT (strengths, weaknesses, opportunities and threats) analysis could be a suggestion. The next step is to set the goals and to describe the actions to which the goals are reached. After this the plan is tested for its acceptability – can it generate the wanted results? How will stakeholders and competitors react and does the strategy march the cultures, or does the culture also need to change? Finally the plan is tested for how it fits to the situation; Product portfolio (lifecycles), financial resources and cash flow, in addition to the human resources (competencies). The result of the process is a written plan for the future, where success demands effective implementation (Ibid.). John P. Kotter wrote the book

”Leading Change”, where he presents the eight step model, which is a model that need to be

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executed in the right order to succeed with the implementation of the change. A second model is the visionary / ideological approach to strategic management, where this model seeks to be inspired by ”best practice” from other organisations, and with this create an attractive vision for the future, which can be the driving force in the organisations strategic development. We will address further attention to these models in the theoretical framework section below.

2.3.3. Social constructivism

The third and last ”ism” is social constructivism which is a practice field that is still under research and development and due to this is not entirely solid cast yet. One of the most important messages in this way of thinking is that humans do often look at things differently;

we have a different focus and / or goals. We therefore, consciously or unconsciously, choose to see something and to overlook something else (Guldbrandsen, 2010). Secondly we experience what we see differently, we have our own attitude, moral and ethic, which is a part of the way we see and experience things the way we do. This term within the social constructivism is called selective perception and leads us to the first important point: In an organisation there is not only one reality. The second important point in this theory is:

Together we create our reality. The reality and the truth are ”born” through dialogue and negotiation together with those that we attach importance and meaning to. Within the theories of management one often use the term communities of practice, when referring to the network we use when we constructs reality. This is where we together create meaning within the organisation. In a social constructivism approach this means that change does not happen and make sense until the change is negotiated and meaningful within the communities of practice.

First, the consequences is that the change should be facilitated and adapted as a process, where all are involved, and where there is room for meaning creation in the communities of practice. Second, there is also a consequence related to that it is hard to predict the outcome of a change, which again challenges the process of change as a planned change, which consist of a number of limited steps. A third principal within the social constructivism is: The positive expectations of refugee’s magical power - the thought of organisations as heliostats tropical systems that grows with the sun, just as plants. Thus, when there is a change it is important that the energy is directed towards the positive expectations to the future, instead of directing it towards the problems in the past. Therefore, with function in the terminology from the functionalism approach, this means that one in the process of change should be based on the vision, rather than ”the burning platform”. Further we will describe these to aspect within a social constructivism approach to change. ”The burning platform” gives a negative emotional reaction, where feelings such as fear, guilt, uncertainty, anger, powerlessness and

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hopelessness are prominent. This leads to defensive actions, whereas people start blaming each other, or they do nothing at all, and / or thirdly they could start fighting against it and resist to the change. However, the visions – ”the burning wish”, contributes with positive feelings to the process of change. This could be feelings like trust, curiosity, happiness, optimism and openness. These feeling will again create actions like creativity, commitment and involvement, and vigour (Ibid.).

The fundamentals that the social constructivism rests on challenges the whole fundamental of the modernism and functionalisms approach to change management, and there exist some critique from the social constructivism towards the classic approach to change management.

The change is not a deviation, but a state and the consequence is that complex models cannot handle the turbulence we face. At the same time the fundamental attitude (disorder) is contributing to create a mood, where change is considered something unpleasant, which needs to be over and done with as fast as possible. According to Kotter the source is to get the humans to change their behaviour and behind this definition there is an assumption that some people do the change and use power, while others are being changed and feel powerlessness.

The social constructivism approach says that resistance to change appears when one feel powerless and the negative feelings are further enhance when dealing with the problems in the past and there is no room for meaning creation within the communities of practice. If the change also relies on simple cause and effect relationships and does not reflect the complexity that characterizes social systems, the meaning creation will have very narrow circumstances and this could easily result in distrust towards the management and resistance. The organisational world is not linear, but circular – everything affects everything. The phase section relies on a thought that it is possible to separate the analysis, recognition, plan and influence. This idea is rejected within the social constructivism – where life is lived forwards, but acknowledged backwards. We learn as we act, and learning leads to new insights and new actions. Learning and action cannot be separated – ”the phases” should be more floating and contain many reflection and reorientation points. The meaning of ”resistance to change” is an important aspect within this and from a social constructivism view the classic approach to this is quite critical. The problem is that the basic assumption, disregard from the things mentioned above, prevents a more nuanced view on the changes that are being executed. If the employees express doubt of parts of the change due to for example that the management have not considered the what type of information the employees possess and that there is a chance or risk that they will not be heard – they are immediately stamped as ” opponents”.

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The problem becomes amplified when the employees have experienced this psychological mindset and further in the future does no longer want to contribute with their knowledge and information, because they have learned that it is wrong to be negative. The consequences of this are repressed emotions, frustration and apathy, which confirms the leader saying”

resistance to change” is the biggest challenge when it comes to change management. From a social constructivism approach one can say that the assumptions that the classic approach relies on when considering change management, creates a self-reinforced negative spiral, whereas we experience, that the biggest challenge in relation to change is to handle the employees resistance, the problem is really within ourselves. The resistance appears due to the way we think and act i relation the change. When we think of ”top-down”, ”the burning platform”, and linear process, we create resistance to change (Ibid.) Appreciative Inquiry (AI) is a model that has been more and more widespread as a method within social constructivism, which can be used in several classic management tasks – including change management (Ibid.).

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3. THEORETICAL FRAMEWORK UNDERSTANDING CHANGE

3.1. Types of change – what is the reason for change?

One can find four different models for change that represents fundamental different sequences of happenings and causal mechanisms which explains how and why change occurs (Jacobsen, 2004).

3.1.1. Planned change

The first model is a teleological model which shows planned change. Planned change occurs because people see some problems they want to solve. Organisations change because people want a change to reach a new goal (Ibid.). This model have some requirements, where the most important one is the one we can call intentional. This means that there are certain intensions or goals behind the process of change. A group of people have analyzed the problems, new possible solutions and then taken actions to solve the given challenges (Ibid.).

It can be illustrated as follows:

Phase 1: Diagnosis: recognition of need for a change – experienced problems / possibilities Phase 2: Solution: descriptions of a future ideal state of mind for the organisation and a plan to further execution

Phase 3: Execution of planned action – interventions in the organisation

Phase 4: Evaluation of planned actions and stabilization of the new ”improved” state

Figure 3.1.1: The four central phases in a planned change process (Jacobsen, 2004, pp.20)

Phase 1 Phase 2 Phase 3 Phase 4

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One can call this an analytic and rational approach to change, which means that the change is based on a perception that there is a need for change, problems have been analyzed and strategies been made for improving and give solutions to the foreseen problems. In phase 1 one recognize these problems, whereas this could be a decrease in the overall sales, conflict between major group internally in the organisation or failing customer loyalty (Ibid.). In phase 2, one tries to find the reason for the problems. Why have the overall sale decreased from one period to another? What are the reasons for the internal conflicts that have appeared the last couple of years? Typical activities related to this could be surveys, interviews and focus groups, often organized by external consultants or scientists. Phase 3 is where the plan is being settled with a time limit, prioritized activities and key personnel for each activity. The activities are being executed in form of teaching, advice from experts or work groups. At the end in phase 4 one evaluates the activities that have been executed. Has the overall sale increased? Are the internal conflicts sorted? Can we see an increase in customer loyalty? If the change is seen as successful, one needs to stabilize or institutionalize the change, which means that one wants to get the support from the employees and the management to enhance the change. This is often done by adapting the payments systems, structures and procedures to the changes that have been made (Ibid.).

This way of thinking is strongly used in western cultures, but it is not the only way a change in an organisation can happen. One major feature with social organisations is that they are undetermined, which means that it is not possible to say what is going to happen, even in near future, so planned change does not always lead to the results one wishes to achieve, which leads us to the other models (Ibid.).

3.1.2. Change as lifecycle

In this model change can happen due to intentional choices, but there is a perception that organisations develop in a special and a pre-determined way. The changes follow a particular development pattern, so that every organisation, from birth, has an underlying form, logic, program or code which regulates the process of change, and moves the units from one start point to a finished form. This means that changes happen because every organisation goes through a set of phases in their ”life” (Ibid.). Henry Mintzberg says that when organisations are established – born – they often have a simple structure, they are small and consist of a few number of people. Once time goes by the organisation grows larger and more people start working there, a need for more formalities arises and this often means that the organisation

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develop a more sophisticated system for surveillance and control, through more extended hierarchies. As the organisation increases in both size and number of people, it creates problems due to the divided structure, and the result is an organisation that has difficulties coordinating the different divisions and keeping it together. Mintzberg suggests in these situations, the possibilities to make a structure matrix, where one could integrate the different division by creating more lateral connections where several units work together for example in projects. Mintzberg is describing organisations that move through a set of phases of life due to growth, where an increase in size implies a need for change in the structure. Age and size are the two most significant elements which provokes an organisational change (Ibid.).

Larry Greiner suggests that organisations that grows, always goes through five phases, where there always is a possibility that the organisation makes it from one phase to another. The phases are the creativity phase, management phase, delegation phase, coordination phase and cooperation phase. In between every one of these phases one find different crises, which are the reason for all the different phases the organisation has to go through. In this approach there is always room for what we call human choices and if an organisation can`t go from one phase to another it will die. The point of action is that when an organisation reaches a certain size, there are few choices concerning the planned change to get to the next phase – the alternatives are in some way given. This can be seen as a sort of planned change, the only different is that there are fewer options to choose in this model, but if the organisation wants to make it to the next level it is crucial that the right decisions are made at the right time according to the situation and also in relation to where the organisation is situated (Ibid.).

This model of change has been criticized because of its deterministic nature, which means that the development of the organisation follows a permanent pattern. Empirical research has also questioned the necessity of the different phases. Many of today`s organisations are bureaucracies, while others manage to grow without establishing any bureaucratic or divisional organisation forms. Change from one form to another could also often happen where an organisation skips some phases or goes back to a previous phase, so even if this model, together with the planned change model, can explain a lot of the reason for change, there is still a need for other models (Ibid.).

3.1.3. Change as evolution

This model focuses on change as a natural development, a perspective which gets its inspiration from theories on evolution amongst living organisms. The model focuses on

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change on a population level and a central term in this is organisational fields – which means an area or marked where a set of organisations compete for limited resources. This could be banks or insurance companies that rivals over customers, or universities which competes over students (Ibid.). In large companies there are powers that resist to the effort of change and there are certain features by an organisations environment which resist change and makes sure that stability is maintained (ibid.). Three aspects in the evolutionary model are central;

variation, selection and maintenance. This can be illustrated in the figure below.

Figure 3.1.3: Central elements in evolutionary change (Jacobsen, 2004, pp. 26).

The idea behind this model is that only the organisation that are best adapted or fit to their environment, will make it against hard competition, others who fail to adapt will die and be exchanged with other and new organisations. This could happen with establishment of new small organisations in a small part of the initial field and that this steals what’s left of the market. In this perspective change happens due to changes in the mix of populations of organisations, but still there is no consistent rule on who lives and who don`t. As a part of some fields there are strong ideals on how organisations should look like and behave. Some organisations are connected to certain values and it is difficult to exchange these fundamental institutions with new ones, because of their knowledge, seniority and depth. The process of change is seen, in this situation, as a natural selection where the environment and surroundings decides which organisations who ”lives” and which ”dies”. This model is not far from what we call ”planned change”, because those who wants to be the best, has to make

New "spicies"

arrives

Variation Selection Maintenance

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adjustments along the way to adapt to its surroundings, to create a balance between the demands of the environment and organisation form (Ibid.). The powers behind these types of changes are, at first, the competition of scarce resources, but secondly new theories have suggested that the competition is also about legitimacy. In some fields there are norms which are based on how an organisation should look like, be established and behave. The organisations that symbolize these messages out to its customer and clients in a best possible way will also get the most support from its environments. In this way it creates a pressure, which is called “isomorphic”, where the organisations are getting more and more similar trying to satisfy and fulfil the dominating values and perception of its surroundings. Change then often happen like imitation – where organisation imitates other organisations that are considered as “the best”. Either way, organisational changes are seen as a reflection of the changes which exists in the environments. When preferences, utility curves and perceptions on what’s hot and what’s not changes, organisations also change and there exist an interpretation that the process of change is a change for something better or together with the relations to society (Ibid.).

The evolutionary model could also exist, whereas ”outside” changes transfers into organisations, and the change in the organisation reflects the changes in the environment.

Overall changes in this model adapts to changes in the environment, where the central aspect is that the changes are not something that the organisation can control (Ibid.).

3.1.4. Change as dialectic process and power battle

This model gets its inspiration from the fact that the development of the society happens through a confrontation between different parties. Change is a result of a power battle between different interests, where a hypothesis meets an anti hypothesis and ends up as something new - a synthesis. This can be seen at an organisational level, where the change in the organisation happens because problems are confronted, bases of power are activated and the part that “wins” changes the organisation after their interests. Politics and power battles, becomes the reason for change, and the result depends on the conflicts and their solutions. In a given point of time there will always be a dominated coalition, which creates a stabile state of mind for the organisation. This coalition creates structures, systems and values, and as long as one accepts that there are different groups of interests, the existence of resistant groups will always be valid. Over time, changes internally in the organisation and the environment may and can affect the base of power. An example of this could be the power balance between employer and employee, depending on weather there are good access for labour supply or not.

If the unemployment rate is high and the supply of labour is high, the wages decreases and the

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working terms and conditions for the employees are less attractive, while if you have the opposite situation the wages decreases and the employees have more influence on the terms and conditions that are being settled in relation to employment (Ibid.). One could also look at the situation where the power balance in an organisation is more even, the change in these situations will often appear after negotiation between the different parts, and the outcome will often be a compromise. This could turn out to be a worse outcome than either of the parties wanted and the rational participant could end up in a relatively less rational solution. The dialectic perspective has a less positive fundamental idea, where it is not necessary the “best”

who “wins”, but rather the “strongest” one. One example of this could be where a financial company buys up another company with the intention of closing it down and in this way one dispose one of the competitors. It could well be that this organisation is better adapted to the environments and more effective, but it “dies” because a “strong” part wants it to. This type of change has been in focus within what we call horizontal integration – change happen, but it is not always that this change is for the best (Ibid.).

3.1.5. Change as contingency / coincidence

This “model” looks at change as a result of coincidences – something that appears without any life phases, solution to a problem, competition of scarce resources, or politics and power battles. James March quotes: “Organisations are in a continuous process of change, routine, practical and respondent, but not always controllable. Organisation seldom do what they been told to do.” (Jacobsen, 2004, p. 31).

Behind this statement there is an assumption that organisations are complex units, where there happen many things at the same time without any participants having control or a total overview over the specific situation. A central point in this is uncertainty and ambiguity and on a general basis one can say that change happens when there is a modern (temporary) concurrence of different organisational streams. It is fundamental that humans (participants) meet each other on an arena (a decision opportunity), where everybody has a different set of ideas and ways to solve a problem. Who meets where and when, will determine how the connections of problems and solutions happens. It is not the best solution to the problem that is the main choice, but rather the solutions, which are available at that particular point in time (Jacobsen, 2004). The main point in this model is that it is where and when the different participants connect, which creates the outcome. Which participants who meets at the different arenas of decision will in many cases be quite structured, but it could also be more

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random who meets, and then also how problems and solutions resolves. Change can appear with individuals or groups changing their routines in the daily work. This could be change in systems, structures, routines, which maybe not have the function that the participant wants, so he or she changes it. These small adjustments takes place on an individual level, but summed together it makes a difference in total, for the organisation (Ibid.).

Another source to a more incoherent development in an organisation comes from the number of turnovers – some people resign and new ones begin. One should often think that once a new person enter a new position, he or she would do close to the same as the previous did, but research has shown that this is in fact, not true. A position or job will never be totally defined and there will always be room for execution of assessment, which leads to personification of the position in favour of the new employee. On a more aggregated level, organisations often experience big changes when changes in so-called cohorts occur. In periods with a lot of new arrivals it may be that the organisation gets in a large group with one particular education, for example lots of women or men, or many young of age. In this way the power balance between the different groups varies, which often leads to changes in important elements in the organisation. This may be part of a large plan for the company, but in many cases these changes will occur without a plan and without being a solution to a defined problem (Ibid.).

A third source to an incoherent development we can find in undefined structures and a planned change can be seen as a decision process, where one evaluates possibilities and threats, find solutions and implement them. However a more anarchistic view on a decision process challenges this approach – whereas we look at the decision process over time with different decision arenas and a set of participants, one could get a larger feature of coherency.

This will again depend on who participates, which depends on the formal structure of the organisation – who has the right and energy to participate? If a person is occupied with something else, someone else might replace him or her, and this person possibly has other ideas, values and solutions to problems. In this way a change can appear spontaneously without this being an answer to a well-defined problem. The result can be that organisations changes in several levels at the same time, without a united plan. Kjell Arne Råvik says that this looks like “multi standard organisations” – which means that different parts of the organisation has adopted various solutions at different times, so change has happened, just not at the same time and in different ways and parts of the organisation (Ibid.).

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The fourth and last source to incoherent change one may find in the environments. The organisations surroundings are seldom clear and uniform, which leads to interpretation of the environments. When changes are made, this is often based on an assumption on how the surroundings look like and not how they actually are. The change gets engraved by coincidences, more based on what one thinks is necessary not on what really is necessary.

This perspective does not stand in direct inconsistency to human choices. Many things of the above mentioned are rational choices, made by individuals, but this does not always mean that it is rational choices in an organisational perspective – organisations change, but not according to an implemented plan (Ibid.).

3.1.6. Different models – competitive or complementary?

Practitioners implies that change has parts of all of the above mentioned aspects and perspectives, but that the reason and explanation behind the different perspectives always will vary from organisation to organisation, from phase to phase and on different levels of analysis – some models are better suited for explaining change on a single organisation level, while others are more used at an aggregated point of view (French & Bell Jr., 1999). Second, the models differs in the way they give room for humanly, free action and thinking – on the one hand they emphasize for individuals making their own choices and creating something new, while on the other hand this is toned down. All of this can be summarized in the following figure, which entails the different perspective discussed above:

Figure 3.1.6: Classification of different changes after change level and logic of change (Jacobsen, 2004, pp. 35)

Evolutionary

Lifecycles

Dialectic

Technological and Coincedence

Non-deterministic Deterministic

Several Organisations

The single Organisation Level of change

Logic of change

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This discussion is important because it makes us aware that not all change has to be a result of conscious and planned human choices and actions. Change is a complex phenomenon and can appear in many ways. Further in this text we will focus on the term ”planned change”, which you may find at the bottom-right in the figure above. This means that we will look more closely at single organisations, and less at changes at an aggregated level. It is worth noticing that ”change as contingency” is placed in the same square as ”planned change” – this implies that there does not have to be a contradiction between the two perspectives. People are always trying to change organisations, but this does not mean that they always succeed, and sometimes changes can happen as a coincidence, all though the initiative were a planned change – contingency and methodical are terms that naturally belongs together (Ibid.).

The literature on the aspect of change only describes techniques and processes on how to achieve change in an organisation, as well as a lot of the models are normative, which means that they tell us something on how things should be or how one should proceed in these situations. One could also say that they are universal, which implies that the models are valid in every organisation and situations. However this is in large contrast to the more ”normal”

demands from a scientific point of view, where the foundation of literature is based upon empirical description as to understand why change happens, and also where the importance of context, plays a central role when defining which opportunities one have to generalize the empirical research compared to other situations. Through empirical research on the processes of change and those features that is close to them, one can make some constructive conclusions, and this means that one can achieve a certain knowledge on how to execute a process of change, how one should proceed in the different contexts and situations and also how likely one is to succeed using different models for change in different situations. A theory on planned change has to be complex, because the units one are trying to change, organisations, are complex (Jacobsen, 2004).

In the section above I have tried to explore further the underlying reasons for change and its outcome, were this can be seen as a lifecycle, as an evolution, as a dialectic process and power battle between different parties, and also as a coincidence. These different models and theories contain and say something about what is it that makes people do the change in the organisation or unit they are involved in? Thus, what are the powers behind the change, and how do these powers affect the different organisations. These models needs to explain the change, what it entails and also the magnitude of the change, and one should also expect that

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these models uses the same terms and understanding frames as the theories on organisational stability. It is important to include the context and the situation surrounding the planned change, and its field and culture needs to be defined. One must explain the change process, both in time and which parties that are involved in the change, and also it could be crucial to be open for the fact that there is not necessary compliance between intentions and the actual result of a change (Ibid.).

CHANGE MODELS AND MANAGEMENT

3.2. The two main models 3.2.1. Kotter’s eight step model

The first model come from functionalism and the classic rational approach to strategic management, where John P. Kotter have developed a eight step model, which needs to be executed in the specific order mentioned below, for the implementation to be successful.

The eight steps are as follows:

Establish an experience of necessity: Investigate the marked and the situation of competition. Identify possible and potential crisises, and significant opportunities. Provoke any emergency or set unreachable goals, if this is necessary. Change does not happen until at least 75 % of the management in the organisation are convinced that business-as-usual are not acceptable.

Create a governing coalition: Establish a group of people with sufficient competence, knowledge and power, to execute the change. The group conduct several meetings and workshops, where the problems are analyzed and the opportunities are explored. The top manager is always a part of the team.

Develop a vision and a plan: Create a vision which can manage the work of change. The vision should be easy to communicate and attractive to the stakeholders. Formulate plans that can make the vision a reality.

Convey and communicate the change vision: Use every term and conditions to communicate the new vision and the strategies. Use the controlling coalition as role models.

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Create a fundamental for action on broad basis: remove obstacles in systems, structure and humans, which may block the change. Encourage risk taking and action.

Generate short term benefits: Plan and realizations of fast and visible victories. Reward them who made the victories possible.

Consolidate the results and produce more change: Use the change increased credibility to change all systems, structure and policies that does not harmonize with the vision. Hire and promote employees that live the vision.

Anchor the new approaches in the culture: Achieve new results through successful behaviour and more effective management. Clarify the connection between new behaviour and results. Recruit and develop management after the vision.

Kotter’s eight step model clearly has relations to Lewin’s model for planned change and rationalism, as well as to the functionalism rational approach to strategic management. In this way Kotter’s first four steps can relate to Lewin’s first phase, and Lewin’s next phase can be found in Kotter’s step five to seven, whereas the last eight steps in Kotter’s model covers the last phase in Lewin’s model. At the same time many of the fundamentals of the rationalism are found in Kotter’s model: Change as a planned process, ”Top-down” approach, change agent ( the controlling coalition), data and rationality as basis for decisions. Kotter’s book were seen as the first qualified text on how to handle ”resistance to change”, which were considered one of the most challenging aspects for leadership in the 90`s. He also introduced new terms like: The burning platform – creating a feeling of necessity, the power of the vision, walk the talk – management`s visible and symbolic actions, and pick the ripe fruit – generation of short term results. Thus, he did not only develop a continuous model, but also development of a new language in relation to change management. At the same time Kotter used culture as an important function to see if the change was in fact a sustainable and persistent change and his view on culture takes basis in the modernistic instrumental approach, where culture is seen as a component which relatively easily can be influenced.

Even thought this part of Kotter’s eight step model were in some degree criticized, especially of the Scandinavian management circuits, his model were still considered as the model of change management (Ibid.).

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The second model and the visionary / ideological approach to strategic management seeks to be inspired by ”best practice” from other organisations and with this create an attractive vision for the future, which can be the driving force in the organisations strategic development (Guldbrandsen, 2010). The thought of using an ideal or a vision when one creates the future, also influenced the theories on change management, so a new school raised – the school of vision. This school seeks to create and develop a vision that attracts stakeholders and the subsequent ”sale” of the vision. The changed focus from the rational to the ideological approach to change is to find in Kotter’s book ”Heart of change”, where he still holds on to the eight step model and the linear approach it builds on, but he emphasise for that the biggest challenge when change happens, is to get the people to change behaviour. The solution to this is to transfer the focus from rational analyze approach to a more emotional see-feel approach, where the primary source to change the employees behaviour is to create positive feelings. The most important tool to do this is to create a vision with great appeal and a burning platform, which is to feel and touch and that clearly illustrates the seriousness of the situation The important thing in relation to this school of vision, is to be able to sell the change and create assumptions such that the new behaviour can unfold. The model can be used to explain the different phases in a change course and also as inspiration in relation to facilitations to practical measures that can be implemented to support the process of change (Ibid.). The first prediction for support from the employees is that the change makes sense, and for the change to make sense one need to create something that is better than what already existed. How does it look like when the change has become a reality? What do the stakeholders get out of it? And what`s in it for me? In the rational approach to strategic change one emphasized hard analytic thinking and a small dream, whereas in the school of vision it is 80 % the dream that gives the change meaning and that dream creates positive feelings and that positive feeling again is the way to create new paths and changed behavioural patterns. After the vision and the ”burning platform” are conveyed, the next step is to create a safety net so that the employees dare to take the first step into the new an unknown. This contributes to give the employees a good gut feeling and a good safety net could be an education plan, a parent project plan, a study trip or maybe a pilot project. The fourth and last element in this theory is a good audience which are aware of the change process, someone that cheers the first initiatives in the process and that can give feedback when things are not going as planned according to the change plan and schedule. In practice a visible and committed management is an important step in securing an enthusiastic audience,

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while other important elements are internal change agents with a license to act, celebration of targets and successes which have been reached along the way and ongoing dialogue meetings where one share different concerns. This model is called the trapeze model and is often used as inspiration in change situations (Ibid.).

3.2.2. The Appreciative Inquiry (AI) model

The second model, or third if one also includes the visionary model to strategic management, is the model based on social constructivism and the AI model. The last years Appreciative Inquiry (AI) has been more and more widespread as a method within social constructivism, which can be used in several classic management tasks – including change management.

Appreciative stands for the attitudinal foundation or basic principle within the method and symbolizes that what we are focusing on are what we really appreciate and care about, and thereby one can create enthusiasm about the change – our successes, strengths and potentials.

The principle has its background from the generally recognized and in some degree empirical well-founded psychological principle – the Pygmalion effect. Behind this principle there is an assumption which says that the expectations we seek to meet others with, contributes to do them to what they are. For example will positive expectations towards our employees bring out the best in them, and yet the positive expectations are confirmed. In the same way, our negative expectations will influence our actions towards the employees and it will become difficult for them to their positive sides. The conclusion is that; ”our expectations contributes to create our reality” .

The word Inquiry is based on a wish to create a better world – for example increase the efficiency, improve the cooperation and/ or increase the quality of the work. The road from the challenge to the action is widely different from the classic approach to problem solving. In the classic problem solving method one uses the basis of past sins to find an optimal solution, by using proven and well documented solutions. In AI one seeks to find a model that uses situations that has worked best and our dreams about the future. The five steps in the 5D circle and AI model, could entail the following elements:

Definition: What is it that we want to promote? The change is being given a motivating headline.

Discovery: In this phase the best moments are explored. When are we closest to achieve what we want to achieve? What do we do when it works best? Which circumstances promote the

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best moments?

Dream: What is it that we dream about? How does it look like when we have reached the goal? How can we be able to determine that this is it? What do we say, feel and do? Can it be measured in some way and what is the first thing we will see when we have reached it?

Design: What can we do to make the dream a reality? How can we create several of the circumstances that form the framework of the best moments? Every possible solution shall be included

Delivery: What do we like to do together – and by ourselves? How will we be able to see if we succeeded? When and how should we make up a status, learn and find initiatives?

(Guldbrandsen, 2010).

3.2.3. Change Management

Organisations and working places are in continuous change, and these changes occur because of external powers, which are making the organisations adapt to the environment, or internal organisational challenges may appear. Organisational Change can be the result of decreasing productivity, changes in the core production or organisational structure. It is natural to separate between planned change and change as a reaction to the surroundings or internally within the organisation. A common model for change management is to see the process dynamically, like a conceptual business model (Busch & Vanebo, 2003). The models point of view is that the company consists of different subsystems;

1. The Behavioural System, 2. The Transformation System 3. The Leader System, and 4. The Coalition System

In addition to this it lays institutionalized and technical surroundings, such as regulations and practice, related to the Coalition system. Change within a subsystem, will effect and create change in the other systems. Change Management as a term conception and ideology lays in the breaking point between these systems. Jacobsen (2004) uses a coarse bisection in type of

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change strategy, which is likely to be used in change situations, where strategy E and strategy O are the two in focus. The authors imply that the different situations of change have different elements and features and that the situation may appear differently in each case (Jacobsen, 2004).

Beer and Nohrias, the authors of ”Breaking the Code of Change”, represents two fundamental different strategies for change - strategy E represents economy and has a economic rational ideology, where a formal structures and systems are in focus, and also the rate of return to the owners. At the opposite end one find strategy O, which goals are to develop the organisations human resources in a way that they are capable to execute strategies and learn from the experiences one has from earlier change initiatives. Strategy E is a ”top-down”-oriented model for change management, where the management give clear and formal instructions, guidelines and directives during the whole change process. The process is seen as linear and as a fundamental rational process, where one begins the process of change with an analysis of the situation and evaluates the possibilities and limitations. It is important to set clear and defined goals on what the organisation wishes to accomplish / achieve with the change(s), followed by solutions and efforts one wants to use, to gain these specific goals, through the implementation phase (Cummings & Huse, 1989).

Strategy O is, in contrast to strategy E, a ”bottom-up” strategy, which is seen as a development process and the change in this perspective is not necessarily a onetime occurrence including the linear elements one finds in strategy E. However this is a continuously process of development and adaption in a wanted direction to achieve the defined goals. Organisation Development (OD) as a traditional aspect within organisational theory, can be placed in this category. The strategy emphasize for learning and participation from all levels in an organisation and the management does not have to be absent in these situations, but rather delegate responsibility and create commitment amongst the employees on lower levels in the organisation. Legitimacy and influence are in this strategy one of many criteria of success, for achieving the most wanted result (Jacobsen, 2004).

One can further take a look at a third strategy, which can be seen as a more Scandinavian oriented direction, where one finds the tradition of cooperation. This trend has its origin from the 1960`s in Tavistock and the foundation behind the strategy is sosio- technological theory, which builds on a principle on how to see social and technical systems in relations to each

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other. If one of the systems changes without considering the other, this may imply lower efficiency, degenerate quality and increased absence due to sickness etc. To find an optimal solution to a change, both systems needs to be taken into consideration – participation and involvement in a process of change are one of the most elderly principles to counteract resistance (Cummings & Huse, 1989).

It could be interesting to compare these strategies with the different sciences we just mentioned in chapter 2.0. Strategy E could be compared to the rational approach, where an economic and rational ideology and approach is in focus, and where one emphasize on structures and systems distributed from a “top-down” access. Also, since Kotter’s eight step models clearly has relations to Lewin’s model, one could also assume that strategy E has in some degree aspects from the classic rational functionalism, where John P. Kotter is seen as one of the most well known authors within change management. The ideological visionary approach within functionalism is harder to place within these strategies, but one could maybe recognize some aspects within strategy O. The vision model seeks to change the employees behaviour with creating positive feelings, whereas this could in some degree be assigned with strategy O`s “bottom-up” approach, were the management may create commitment amongst the employees and include all parts of the organisation. However it is important to mention that strategy O is seen as a continuous process of development and adaption in a wanted direction, while the functional vision model still holds on to the linear approach it builds on, but it emphasize more for that the biggest challenge is to get people to change behaviour.

Maybe this could be achieved or obtained by involving and committing people to the change?

Finally the social constructivism approach is considered, and one can try to identify aspects which can be recognized in the third strategy mentioned above. This strategy is maybe more a combination of strategy E and O, rather than similar to the social constructivism model.

However, the strategy is originated from the sosio-technological theory, which seeks to find and recognize social and technical systems in relations to each other. Could this be seen as “in organisations there is not only one reality”, which are described in the theory of social constructivism? Can it be seen as “we create our own reality”, by combining the two aspects of social fundamentals and technical systems. Could this be seen as one way of thinking about the social constructivism model, in practice? If it is the right way or not is difficult to know, however, it could be seen as a suggestion on one way of looking at it, and further it is up to other researchers to validate the interpretation of the term social constructivism.

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