1.0 Introduction
Management is about making decision. Just as there are different styles of leadership, there are different styles for making decision. Making a decision not only involves quantitative analysis but it also calls for qualitative analysis. Decision making is defined as mental processes that result in a course of action or a given opinion among several options that have been presented. Every decision made by a manager bears in mind that there will be a certain outcome in the future. There are various factors that come into play when making a decision but these factors can be divided into two categories: quantitative and qualitative factors. The quantitative factors attach a numerical value to the possible outcome of a decision that has been made such sales projections over the next five years, cost of production of new line of products e.t.c. While it is important to consider such factors, they should not be examined in exclusion. The effects on others such as the stakeholders of the organization and the workforce should be considered and the possible reactions of these people ought to be considered. Qualitative factors include: human resource management, long term effects of the decision, public image of the company and the stakeholder analysis. A SWOT (strengths, weakness, opportunities, and threat) analysis ought to be carried out in making a decision.
Organizations have always undergone changes but the past decades of the 21st century have been marked by remarkable changes. The changes that have taken place in organizations and corporations have been the source of relentless pursuit on how to manage the change and benefit from it. The rapid changes that take place in organization such as the ones that have been witnessed in the last four decades require adaptability, leadership and the ability to learn. Organizational culture cannot escape the effect of change hence more often than not; change can be met by resistance or conflict. It is against this background that this paper shall examine two critical tenets of management: decision making and the impact of change on organizational culture. It shall review the factors that influence decision making in addition to issues arising from organizational change and the impact of change on organizational culture.
2.0 Factors that influence decision making in management
There are diverse factors that have an impact on the decision making processes that are made by managers.. One of the factors that influence decision making is the accounting and opportunity costs. A good decision in this context is one that will cost the least and generate the maximum revenue. It is necessary for the management to access specific goals and objectives that they expect to achieve as they make their decision. Some of the objectives that can be set include; the quality of the product, the willingness to take a risk, the profit margins, and the product line.
The decision making process is somehow complicated by the fact the management needs to determine whether the decision is a long term or a short term one. This is particularly critical when it comes to profitability objectives. The management ought to focus profitability objectives such as sales, the return of the assets or equity and the earnings to be acquired per share. Based on the profitability objectives; the priorities to be considered in making a decision shift. For instance, if the aim is to make profits, then the building a new plant may not be a priority. If the aim is to increase the net income for a short period, the management might decide to offer the stocks of the organization for purchase by investors. The decision made by the management in the short run eventually has an impact in the long run.
The competition that the organization that the organization influences the decision made by the management. It is important to consider not only what the industries related to the organization is doing but also what is happening in the global market. Competition offers a gauge by which the organization can determine the trends in their sector in addition to planning to their future moves. An organization that aspires to grow beyond the boundaries of the country it is located ought to keep up with global trends in order to gain insight on new ideas that have been adopted successfully elsewhere. It also aids the management in the identification of new opportunities that organization could be open to exploring.
External factors are factors that exist outside the organization which affect the growth and the survival of the organization. These factors include: laws and regulations, customer preferences, risks and resources such as the workers and raw materials. Before the management makes a decision, they have to understand the laws and regulations that govern the formulation of company policies. It may be important to consult a legal expert in order to come to the right conclusion before making a decision. Customers are the consumers of the goods produced by an organization. Their preferences ought to be taken into consideration prior to making a decision. The preferences are subject to trends hence making it important to monitor the trends prior to making a decision. They also differ based on age, ethnicity, and economic status of the consumers. All the factors discussed above ought to be taken into consideration when the management is in the process of making a decision.
2.0 Issues arising from organizational change and their impact on organizational culture
There are four types of change that can take place in an organization: strategic, operational, political, and cultural changes. Cultural changes have an effect in the philosophies of an organization while operational changes have an effect on how a company is run. Strategic changes have an effect on the strategic aspect of the company and political changes have to do with power or leadership struggles within the company.
Change in an organization can be driven by either internal or external forces. The major internal factors that lead to change are: the need for improvement of products or services offered by the company, improvement of the efficiency of operation and process improvement. The major external factors that lead to change are: government, regulatory demands, requirements by the customer, and shareholder or city requirements. Technological advancement is also included as one of the external factors that lead to change. In the recent past, several companies have automated their operations or introduced robotics as part of their assembly procedure. With such advancement, it is necessary to equip the staff in addition to the managers to adequately manage the new responsibilities that they have to bear. Social and political changes can also take place leading to the need to hire consultants to help the organization to come up with new means to deal with the shift in political or social views. Internal forces on the other hand spring from within the organization. One of the internal factors could be human resource problems. This could stem in a mismatch between the interests of the organization and those of the employees. Change may also result in conflict between the management and employees.
It is imperative that the management understands the organizational culture in order to smoothly manage the changes that take place within the organization. Organizational culture is defined as “ a pattern of shared assumptions that the group learned as it solved its problems of external adaptation and internal integration, has worked well enough to be considered as valid and therefore to be taught to new members as the correct way to perceive, think and feel in relation to those problems.” Key ingredients of organizational culture include: taking risks, innovation, team orientation, beliefs, norms, ethical systems and symbols. Change affects these aspects hence the need to identify the issues arising from change and deal with them in their infancy.
Organizational leaders need to understand that change is uncomfortable and unsettling. The coping mechanism for employees to change takes stages which are: shock, resistance, exploration and acceptance. The employees may feel threatened by the upcoming change or deny that the change is going to take place. As a result, their productivity decreases. The second reaction involves an attempt to hold onto what used to be hence the employees will exhibit defensive retreat. After a while, people no longer fight the change which offers a sense of relief to the employees. The employees at this stage may offer to undergo training in order to equip themselves to deal with the change. The final stage of change is acceptance and adaptation. This involves leaving behind the confusion and pain while accepting and embracing the change.
In the course of executing change, it may be necessary to lay off some of the workers. This may have a negative impact on the team orientation given that the duties are specific to a given person thus their departure from the organization means that the duties have to be redistributed. The cohesiveness of a team is deeply be affected by this resulting in disruption in the execution of duties. Change triggers fear and anxiety among the employees. They are afraid that they could lose their jobs hence they will tip toe around the work place and take less risks. Employees who may have been known to bold and outspoken will shy away from speaking their mind because they think they might be laid off for doing something wrong. The motivation of the employees is important for them to be productive. Change presents a challenge to the motivation of the employees because it presents a new structure, set of beliefs and ethical systems within which the employees work.
Innovation makes up a key component of most organization. It is the bed rock for new products or services. Change may impede the innovations that are undertaken within an organization. In the event that the organization is keen on cutting down costs, more efforts are often diverted towards mass production of the currently stocked goods in order to keep making profits. Innovation in such cases becomes an after with funds required for innovation to be carried out being diverted to other causes.
3.0 Conflict as a result of change and practices that lead to overcoming the resistance of change
A survey by the Change management report indicates that there are several obstacles in the path of executing change in an organization. These obstacles include: insufficient time for implementation of change, costs going over the intended budget, staff turnover in the course of transition, insufficient training for the implementation of change, communication break down and resistance by employees. Among these obstacles, it has been found that the top two obstacles are breakdown of communication and employee resistance or conflict with the management. There are several reasons as to why employees resist change: employees may feel that there is a need to maintain the status quo, they may harbor fear for the uncertain times ahead, they may be anxious about the changes that are taking place in the work place and they could harbor fears over the loss of their jobs or losing their friends at the workplace as a result of change implementation. If a change initiative fails, there is a possibility that the management and the leadership could lose credibility. This could act as a source of conflict within the work place because the employees no longer trust the management to lead the organization in the right direction.
The management should seek to understand why employees resist change and by extension act out resulting in conflict at the work place. Scholars have identified several reasons as to why change is resisted by employees. Change alters habits that the employees have long practiced. It modifies the social interactions within the work place and is often introduced poorly. The individual/group efforts are often undermined in the course of implementing change.
There are several management pitfalls that could result in the management meeting resistance in the course of implementation of change. These pitfalls are often breeding grounds for conflict between the employees and the management or within the ranks of the management. The management may fail to notice the urgency in the implementation of change or fail to understand the rationale for the change. Some managers also fail to adequately mobilize the employees to implement change or take up several initiatives at one time hence lose track of the priorities. In the course of implementing change, the top level and mid-level management often interpret the implementation of the changes differently thus sending mixed messages to those charged with the duty of executing the changes.
Given the tricky navigation course in the path to implementing change, it is important that the management adapt practices that will make easy for the employees to adapt change and minimize conflicts that often arise as a result of change. Scholars have identified key tactics that can be used by managers. The first step that should be taken by the management is the identification and the delivery of education regarding the changes that are going to be implemented. Education ought to be carried out from the top echelons of the management down to the rest of the workforce. The aim of the education should be to equip the workforce with new skills that will enable them to cope with the changes that are taking place within the organization. Less focus should be directed towards concepts and strategies that are being employed as change is being implemented within the organization.
The management also ought to come up with a solid communication strategy. The aim of the communication strategy should be: to make way for employee input in the course of the implementation of change, to articulate the desired outcome and identify the concerns of the workers of the organization. The management ought to organize consultative meetings with mid-level management in order to get them on board prior to the implementation of change. This will prevent incidences of the management sending mixed signals from occurring. The management also ought to get all the groups that are going to be involved in the implementation of change involved in the process once the organization is ready to implement the change.
For change to be successfully implemented, several subsystems ought to be in place such as human resource policies, information systems and job design. With the appropriate modifications, change can gradually be implemented within an organization. For instance jobs ought to be redesigned in order to make room for the changes made within the workforce. The information systems ought to be modified in order to carry ought a decision making process. The management also ought to supply the adequate resources that are required for the process of change to be effected. This could be in form of money, facilities such as office space, equipment such as computers, printers and other forms of stationery.
Without the provision of adequate resources, the change being initiated by the management might fail to take off. Key individuals who are not instrumental in the implementation of change ought to be let go off in order to get rid of unnecessary resistance to the process of change. A measure of performance ought to be drafted by the management in addition to coming up with a reward system. In conclusion, management of change requires preparation.
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