Deck 7: Managing Change and Innovation

Question 1

In a short essay, describe four external and four internal forces of change and provide examples of how each force impacts the manager's job.

Answer 1

a)External forces: The external forces that create the need for change come from various sources. In recent years, the marketplace has affected companies in the airline industry as we described in the opening to this chapter.Low-cost airlines such as Virgin Australia and Tigerair have thrown down a challenge to Qantas in the domestic market, and Emirates, Etihad, Singapore Airlines and Delta Air Lines saw the Global Financial Crisis in 2007-10 as an opportunity to increase their foothold in the international markets between Australia, Europe and the US by increasing services to Australia even when demand in the international business travel market was falling.Equally, Telstra must contend with Optus, VirginMobile, Vodafone, Primus and many other telecommunications companies in the same way that Telecom New Zealand must compete with TelstraClear and Vodafone.The deregulation of the telecommunications market has meant radical changes to both pricing and service strategies in order to attract and keep customers. Government laws and regulations are a frequent impetus for change.The Australian Federal Government's decision to reduce import tariffs on cars, which were as high as 57.5 per cent in 1978, sparked off major changes in the car manufacturing industry in Australia.The lower tariffs forced Australian car manufacturers either to implement changes to improve their productivity, or to cease their local manufacturing, as became the case for Nissan in 1992 and Mitsubishi in 2008.Due to difficulties in remaining competitive under these changed conditions, Ford has also decided to cease manufacturing cars in Australia in 2016 and both Holden and Toyota may do the same.The passage of the Workplace Relations Amendment (WorkChoices)Act 2005 in Australia by the then Coalition government provided opportunities for businesses to change employees' work conditions and pay, leading to major changes in some organisations.Due to a change of government in Australia at the end of 2007, there were again renewed forces for change as the new Labor government made changes to the Workplace Relations Act and introduced the Fair Work Act 2009, which, again, changed the industrial relations arena.Further changes may be implemented by the new Coalition government that came into power in 2013. Another area that is being affected by regulatory uncertainties is Australia's efforts to tackle climate change.While a carbon emission trading scheme seemed to have bipartisan support in the first few years of the new millennium, that unity soon fell apart - particularly when the effects of the GFC began to impact on the public's and some politicians' support for such a scheme.Instead, it became a highly controversial and politicised issue with strong views on each side.Despite this, the Labor government, with the support of the Greens and the independents, managed to introduce a carbon pricing scheme (which, unfortunately, was labelled as a tax)that came into effect on 1 July 2013.However, the Coalition government that defeated the previous Labor government in the October 2013 election has made it a core promise to the electorate that it will repeal the carbon tax and introduce a direct action strategy to deal with Australia's need to tackle global warming and climate change.It can be seen, therefore, that this is still a very uncertain area, with frequent changes and reversals of direction that have made it extremely difficult for organisations to develop strategies and plans for how they should address the issue. Technology also creates the need for change.For example, technological developments in sophisticated and extremely expensive diagnostic equipment have created significant economies of scale for hospitals and medical centres.Assembly-line technology in other industries is changing dramatically as organisations replace human labour with robots.Even in the greetings card industry, email and the internet have influenced the way people exchange greetings cards. The fluctuation in labour markets forces managers to change.Organisations that need certain kinds of employees must change their human resource management activities in order to attract and retain skilled employees in the areas of greatest need.For instance, health-care organisations facing severe nursing shortages have had to change the way they schedule work hours.The huge demand for skilled staff in the Western Australian-based booming resource industry is also brought about major changes. Economic changes, of course, affect almost all organisations.For instance, global recessionary pressures force organisations to become more cost efficient to survive, as happened during the GFC in 2007-2010.But even in a strong economy, uncertainties about interest rates and currency exchange rates create conditions that may force organisations to change. b)Internal forces: In addition to the external forces, internal forces also can stimulate the need for change.These internal forces tend to originate primarily from the internal operations of the organisation or from the impact of external changes. A redefinition or modification of an organisation's strategy often introduces a host of changes.For example, Telstra has undergone major changes, as it has been fully privatised and separated from the Australian government.A much more aggressive and performance-oriented organisational culture has been developed at Telstra.It is a culture that now places providing value to Telstra's shareholders ahead of national interests.For example, the company embroiled itself in major clashes with the Australian government over price regulations and whether it would be involved in the building of the National Broadband Network (NBN)in Australia. In addition, an organisation's workforce is rarely static.Its composition changes in terms of age, education, sex and so forth.Take, for instance, an organisation where a large number of experienced executives, because of financial reasons, decide to continue working instead of retiring.There might be a need to restructure jobs in order to retain and motivate younger managers because promotions may be harder to come by.The compensation and benefits system might also need to be adapted to reflect the needs of an older workforce. The introduction of new equipment represents another internal force for change.Employees may have their jobs redesigned, need to undergo training on how to operate the new equipment or be required to establish new interaction patterns within their work group. Employee attitudes such as increased job dissatisfaction may lead to increased absenteeism, more voluntary resignations and even labour strikes.Such events will, in turn, often lead to changes in management policies and practices.

Question 2

Lewin's theory is consistent with which view of organisational change?

A)contemporary
B)change in the 1990s
C)continuous
D)'calm waters'
E)Mayo's

Answer 2

D

Question 3

Change is an organisational reality.

Answer 3

True

Question 4

Increasing the numbers of employed women and minorities forces managers to pay attention to what change factor?

A)strategy
B)equipment
C)workforce
D)technology
E)employee attitudes

Question 5

Changing human resource activities to attract and retain health care specialists due to increased needs for those workers is an example of what kind of environmental change factor?

A)government laws and regulations
B)technology
C)labour markets
D)marketplace
E)economic

Question 6

The marketplace is an external force of change.

Question 7

Which of the following is NOT an external force of change?

A)economic changes
B)workforce
C)technology
D)government laws and regulations
E)marketplace

Question 8

The 2005 passage of the Workplace Relations Amendment (Workchoices)Act is an example of which of the following forms of environmental change?

A)government laws and regulations
B)economic
C)technology
D)labour markets
E)internal

Question 9

In the 'white-water rapids' metaphor of change, managers should expect change at any time and it may last for unspecified lengths of time.

Question 10

Economic changes are an internal force of change.

Question 11

Global recessionary pressures force organisations to become more ________.

A)cost efficient
B)conservative of raw materials
C)price competitive
D)quality conscious
E)human orientated

Question 12

Managing change is ________.

A)an integral part of every manager's job
B)an integral part of top management's job
C)an integral part of first-line management's job
D)an integral part of middle-level management's job
E)an integral part of every employee's job

Question 13

Which of the following is NOT an internal force of change?

A)employee attitudes
B)workforce
C)strategy
D)technology
E)equipment

Question 14

Labour markets are an internal force for change.

Question 15

What change factor was evident when Telstra became fully privatised and separated from the Australian Government, and the new CEO placed providing value for shareholders ahead of national interests?

A)strategy
B)equipment
C)technology
D)external
E)workforce

Question 16

Labour strikes are an example of what change factor that may encourage a change in management thinking and practices?

A)employee attitudes
B)government laws and regulations
C)strategy
D)equipment
E)workforce

Question 17

The change in demand for health care staff is an example of an economic change.

Question 18

Who theorised the change process involving unfreezing, changing and refreezing?

A)Drucker
B)Lewin
C)Robbins
D)Lawler
E)Mayo

Question 19

Falling interest rates would most stimulate what change factor for a manager?

A)marketplace
B)economic
C)labour markets
D)government laws and regulations
E)technology

Question 20

The 'calm waters' approach to change would be consistent with Lewin's concept of unfreezing, changing and refreezing.

Question 21

A manager who comes to work every morning expecting that today will definitely bring new challenges from competitors, the workforce, etc., views organisational change in what way?

A)continuous
B)occasional
C)pessimistic
D)pragmatic
E)reactive

Question 22

Techniques to change people and the quality of interpersonal work relationships are termed organisational development.

Question 23

Probably the most visible technology changes in recent years have come through managers' efforts to expand corporate financing.

Question 24

According to Kurt Lewin, which of the following is NOT a stage in the change process?

A)refreezing
B)restraining
C)changing
D)unfreezing
E)both C and D

Question 25

Computerisation is a technological change that replaces people with machines.

Question 26

In a short essay, describe, compare and contrast the 'calm-waters' and 'white-water rapids' views of organisational change.

Question 27

According to the textbook, 'changing structure' includes alteration in any of the following EXCEPT ________.

A)job redesign
B)coordination mechanisms
C)authority relations
D)technology
E)degree of centralisation

Question 28

As ________, managers should be motivated to initiate change because they are committed to improving their organisation's effectiveness.

A)process consultants
B)manipulators
C)efficiency experts
D)change agents
E)reengineering specialists

Question 29

In promoting organisational change, outside consultants are usually more ________, whereas internal managers may be more ________.

A)cautious; friendly
B)highly paid; risky
C)drastic; thoughtful
D)resistant; bold
E)interested; scared

Question 30

Which of the following is the objective of refreezing, according to Lewin?

A)stabilises the new situation
B)hinders movement away from existing equilibrium
C)directs behaviour away from the status quo
D)eliminates the need for future change
E)changes to a new environment

Question 31

Which of the following terms best describes the two primary views of the change process?

A)optimistic and pessimistic
B)reactive and proactive
C)occasional and continuous
D)problematic and encouraged
E)costly and conservative

Question 32

According to the textbook, the ________ is consistent with uncertain and dynamic environments.

A)cultural metaphor
B)calm-waters metaphor
C)white-water rapids metaphor
D)contemporary metaphor
E)continuous metaphor

Question 33

The manager's options for change essentially fall into three categories: structure, technology and product.

Question 34

Most early studies in management, such as Taylor and the Gilbreths, dealt with efforts aimed at ________.

A)structural design change
B)functional design change
C)cross team changing
D)structural component change
E)technological change

Question 35

According to the textbook, managers in such businesses as wireless telecommunications, computer software, pharmaceuticals and women's high-fashion clothing have long confronted the ________.

A)white-water rapids metaphor
B)cultural metaphor
C)contemporary metaphor
D)continuous metaphor
E)calm-waters metaphor

Question 36

In an organisation, who is usually the change agent?

A)any manager or non-manager
B)CEO
C)union leaders
D)executive vice president
E)any competitor

Question 37

According to Kurt Lewin, increasing the driving forces, which direct behaviour away from the status quo, is a means of doing which of the following?

A)changing
B)refreezing
C)melting
D)unfreezing
E)restraining forces

Question 38

Organisational change can be alteration in people, structure or technology.

Question 39

Managers' options for change essentially fall into what three categories?

A)structure, technology and people
B)environment, technology and mission
C)environment, attitudes and processes
D)mission, structure and people
E)mission, environment and process

Question 40

In organisations, people who act as catalysts and assume responsibility for managing the change process are called ________.

A)operations managers
B)change masters
C)change agents
D)transformational leaders
E)charismatic leaders

Question 41

________ is a method of changing behaviour through unstructured group interaction.

A)Organisational development
B)Team building
C)Survey feedback
D)Process consultation
E)Sensitivity training

Question 42

Co-optation is a form of both manipulation and participation.

Question 43

Negotiation refers to covert attempts to influence, twisting and distorting facts or withholding information.

Question 44

When grocery stores installed scanners to read the product price, this was an example of managing what change category?

A)laws and regulations
B)technology
C)people
D)structure
E)competitors

Question 45

Never negotiate with employees as a means of overcoming resistance to change.

Question 46

A company that decides to decentralise its sales procedures is managing what change category?

A)structure
B)technology
C)equipment
D)people
E)competitors

Question 47

Co-optation refers to covert attempts to influence.

Question 48

A major disadvantage of coercion is that it is frequently illegal.

Question 49

According to the textbook, an individual is likely to resist change because of all of the following reasons EXCEPT ________.

A)increased productivity
B)concern over personal loss
C)uncertainty
D)belief that the change is not in the organisation's best interest
E)Both A and C

Question 50

Techniques to change people and the quality of interpersonal work relationships are termed ________.

A)robotics
B)downsizing
C)operations
D)organisational development
E)automation

Question 51

If an organisation increases the span of control, what factor is being focused on in an organisational change?

A)strategy
B)people
C)technology
D)human resources
E)structure

Question 52

According to the textbook, competitive factors or new innovations within an industry often require managers to introduce all of the following EXCEPT ________.

A)new employees
B)new equipment
C)new operating methods
D)new tools
E)both B and D

Question 53

In a short essay, list and discuss the three categories in which the options for management to implement change fall.

Question 54

Which of the following reactions to change is a threat to the investment you have already made in the status quo?

A)change is not good for the organisation
B)freezing
C)refreezing
D)concern over personal loss
E)uncertainty

Question 55

Probably the most visible technological changes in recent years have come through managers' efforts to expand ________.

A)employee retention
B)computerisation
C)organisational culture
D)corporate financing
E)robotics

Question 56

________ is a technological change that replaces people with machines.

A)Downsizing
B)Organisational development
C)Operations
D)Automation
E)Robotics

Question 57

If Kraft Foods hired a consultant to decrease group friction and enhance cooperative work relationships, this would be an example of managing what change category?

A)laws and regulations
B)technology
C)structure
D)competitors
E)people

Question 58

One reason people resist change is that it substitutes ambiguity for uncertainty.

Question 59

Manipulation is using direct threats.

Question 60

Change threatens the investment you have already made in the status quo.

Question 61

Management offering the union guaranteed wage hikes and a no-layoff promise in exchange for help in implementing a new production process would be an example of what kind of tactic for reducing change resistance?

A)facilitation and support
B)participation
C)coercion
D)manipulation and co-optation
E)negotiation

Question 62

The existence of a dramatic crisis can facilitate cultural change.

Question 63

The first step in accomplishing organisational cultural change is to initiate a reorganisation.

Question 64

________ refers to covert attempts to influence, twisting and distorting facts or withholding information.

A)Co-optation
B)Manipulation
C)Education and communication
D)Negotiation
E)Coercion

Question 65

Qantas including employees on the committee to decide what colour the new uniform colours should be is an example of what tactic for reducing change resistance?

A)facilitation and support
B)manipulation and co-optation
C)participation
D)education and communication
E)coercion

Question 66

A bank offering personal and financial counselling to employees prior to an upcoming downsizing is an example of what kind of tactic for reducing change resistance?

A)manipulation and co-optation
B)negotiation
C)facilitation and support
D)education and communication
E)coercion

Question 67

________ is using direct threats or force on those who resist change.

A)Negotiation
B)Coercion
C)Co-optation
D)Manipulation
E)Education and communication

Question 68

In terms of organisational factors, any attempt to lower stress levels has to begin with employee selection.

Question 69

Which of the reasons for resistance to change may be beneficial to the organisation?

A)uncertainty
B)change is not good for the organisation
C)refreezing
D)freezing
E)concern over personal loss

Question 70

A manager who threatens to ruin an employee's name in the company if he/she does not cooperate with an impending organisational change is using what kind of tactic for reducing change resistance?

A)education and communication
B)manipulation and co-optation
C)negotiation
D)facilitation and support
E)coercion

Question 71

Which of the following techniques for reducing resistance to change is based on the belief that, if employees receive the full facts and clarifications, they will no longer be resistant?

A)participation
B)manipulation and co-optation
C)negotiation
D)facilitation and support
E)education and communication

Question 72

Stress is an adverse reaction people have to excessive pressure placed on them for extraordinary demands, constraints or opportunities.

Question 73

Which of the following represents the relationship between organisational culture and change?

A)Culture and change are naturally compatible.
B)Culture can never be purposely changed.
C)Culture can change in months but not weeks.
D)Culture tends to be very resistant to change.
E)There is no relationship between culture and change.

Question 74

A state government purposely misrepresenting public employee wages to the citizens in order to apply downward wage pressure in the collective bargaining process would be an example of what kind of tactic for reducing change resistance?

A)manipulation
B)negotiation
C)education and communication
D)coercion
E)co-optation

Question 75

Cultural change is easier when the organisational culture is strong.

Question 76

All of the following are mentioned in the textbook as actions that managers can use to deal with resistance to change EXCEPT ________.

A)facilitation and support
B)diversification
C)negotiation
D)education and communication
E)participation

Question 77

Organisational cultures tend to resist change.

Question 78

'Buying off' the leader of a resistance group in order to get his/her endorsement is an example of what kind of tactic for reducing change resistance?

A)negotiation
B)co-optation
C)facilitation and support
D)coercion
E)education and commitment

Question 79

A leadership change can facilitate cultural change.

Question 80

In a short essay, list and discuss three of the reasons that describe why people resist change.Include an example of each reason to support your answer.