Individual Written Essay Example

  • Category:
    Management
  • Document type:
    Essay
  • Level:
    Masters
  • Page:
    3
  • Words:
    1573

Rapid, Volatile, Discontinuous Change in an Organization

Overview

Present-day management literature recognizes change as an inevitable aspect in business operations across public and private sectors. Changes in the business environment can be rapid, volatile or dynamic. The results in turn trigger pre-emptive or reactive changes in the strategies and management structure of a business. This essay examines the concept of rapid, volatile and discontinuous change. It further discusses how this concept fits within the strategic management process. Further analysis include the models used in assessing the role, impacts and implications of the concept in an organization as well as how CEOs should respond to discontinuous changes. Particular emphasis is on the evidence on whether the CEOs do respond appropriately to discontinuous change.

Introduction

The modern-day dynamic business environment calls for a need for organizations to change as well as restructure their management strategies. In this digital age, business entities are predisposed to balance their brick and mortar processes with computer-based strategies (Deeg, 1). Even so, changes can either have positive impacts on the organization or be totally disruptive. Such have imposed a need to redefine the core aspects of an organization’s strategic direction. As discussed subsequently, the concept of rapid, volatile and discontinuous change have triggered a need for a proactive, preemptive and responsive strategic management approach to ensure the success and substance of an organization (Deeg, 2).

The concept of rapid, volatile, discontinuous change

Since the need for change is more often unpredictable than foreseeable, it tends to be ad hoc, reactive and sometimes discontinuous (Todnem, 371). Successful management of change is a requirement to succeed in a continuously evolving and a highly volatile business environment.

Towards this end, the concept of rapid, volatile and discontinuous is borne. The concept is in fact, a distinct, sudden shift from the past. This kind of change is marked by frequent shifts in the strategy or structure that can either be small or massive in extent, often caused by internal problems or external shock. It can further be described as onetime events that occur through extensive distinct initiatives, followed up by unpredictable periods of stillness (Todnem, 371).

Such changes tend to be episodic, infrequent and sometimes intentional. The presupposition is that such changes have the tendency to take place during periods of divergence, when businesses are shifting away from their equilibrium conditions (Weick and Quinn, 365). Divergence refers to a situation where there is an increasing misalignment between the perceived environmental demands and the tendency of the management structure to remain inactive or unresponsive (Weick and Quinn, 365). The discontinuous change is termed as episodic since it tends to take place at a time when shifts triggered by external factors such as technology change, or due to internal factors such as change in key personnel.

The concept of rapid, volatile and discontinuous change demands that in the contemporary and dynamic business environment that is marked with highly competitive and volatile markets, organizations should manage the change quickly, productively and positively in order to be successful. Business management in a volatile element that is characterized by rapid and abrupt changes if fundamentally about managing such changes, to enable the business to respond quickly and effectively to the conditions in the environment. This means that the business must be adaptable, responsive and flexible. High levels of change prompt high levels of response, while discontinuous change call for radical actions (Weick, Karl & Quinn, 365-366).

How the concept fits within the Strategic Management process

Strategic management comprises a set of decision-making courses of action that determine the long run performance of an enterprise. The process involves scanning the external and internal environment, long-range planning, implementation and evaluation (Chaneta, 17). In the perspective of business administration, it is essential to examine the strategic alignment between the business and its environment, or the strategic consistency (Kaplan & Norton, 9-10). In a highly volatile business environment, strategic consistency exists when the business operations are consistent with the expectation of the management in responding to rapid change. To ensure this, there is a need to formulate strategies that can manage the change effects during the long-range planning process. The change management therefore falls within the planning phase.

Therefore, within the strategic management process, the concept of rapid, volatile and discontinuous change fits within the area of long-range planning (change management). In the process of strategic management, an organization must examine the forces that may seek to derail the tactical goals of the organization (Lehman, Greener & Simpson, 197).

Model used to assess the role, impacts, and implications of rapid, volatile, discontinuous change for an organization.

The learning model used in simulation can be applied in assessing the role, impacts and implications of rapid, volatile and discontinuous change in organizations. The organizational learning model hypothesizes that the impetus for organizational change and response is prompted by performance above or below the target level of performance (Lant & Mezia, 149).

The model has three basic components. First, the target level of performance to which the actual performance is compared, second, performance above or below the target level, affects the possibility of observing organizational change because of performance that is relative to the targeted level determines the organization’s success or failure. Third, the learning model suggests that information acquisition and processing about alternatives takes place in a comparatively costly process of search (Lant & Mezia, 149).

How CEOs should respond to discontinuous change

The CEO can respond to rapid, volatile and discontinuous change.

Identify change imperative: First, CEOs should identify the change imperative, which involves identifying the underlying problems of the organization and the need for change (Jones, 7; Latta, 25).

Coalition building: The CEO should also develop a shared direction, such as providing a clear direction for change and building a coalition of support, or engaging people with the greatest influence over the organization and who have the commitment and energy to manage the change and maintain the momentum (Latta, 23).

Mobilization: Backed by a strong coalition and the right information on the discontinuous change, the CEO designates different people and resources to work collaboratively in executing the plan (Jones, 7).

Evidence on CEOs’ response to discontinuous change

CEOs have often failed to respond appropriately to discontinuous change. While a growing body of researches continues to show evidence that large organizations face significant difficulties in responding to rapid and discontinuous change, a comprehensive theory that explains the phenomenon lacks. However, a modern incentive theory offers a framework for the discussion on why changes in incentive-driven organizations run by CEOs face difficulties in responding to discontinuous change. This is particularly because in responding to discontinuous change, the CEO has to build coalitions within the upper management level that would manage the change ((Kaplan, Sarah & Henderson, 3).

In the process of coming up with a management strategy, CEOs should set up isolated or autonomous organizational units or coalitions, and then manage the new unit using processes that are different from those used in the organization, or a different incentive structure. While researches have indicated that many CEOs recognize that different incentive structure would encourage their employees to pursue strategies for managing discontinuous changes, they are unwilling to use the incentive system due to the prospect of implementing it (Kaplan, Sarah & Henderson, 4)..

Even as the definition of discontinuous change is highly controversial, it is generally depicted as accompanied by uncertainties. Under such circumstances, CEOs remain uncertain on which measures they should base the incentive system. Additionally, a new relational contract may seem a violation of the existing relational contract, thus managing the current enterprise becomes difficult for CEO (Kaplan, Sarah & Henderson, 3-7).

Conclusion

In conclusion, modern-day organizations operate in highly volatile and competitive environments, where responsiveness to change is the key to success and sustenance. Under such circumstances, rapid, volatile and discontinuous change is likely to occur. As a result, strategic management should be consistently be redefined to reflect the needs of the organization as well as to respond to the changes in the environment (Munive-Herandez, 691-692).

Works Cited

Deeg, Jürgen. Organizational discontinuity: Evolutionary, revolutionary and re-evolutionary change. Paper presented at the 25th Standing Conference on Organizational Symbolism “Signs of the future: Management, messianism, catastrophe” 1-4 July 2007, Ljubljana, Slovenia, 2007. <http://www.fernuni-hagen.de/weibler/download/organizational_discontinuity_full_paper.pdf>

Chaneta, I. ‘Strategic Management Process,’ Journal of Comprehensive Research, Vol 5, 2007. p17, <http://jupapadoc.startlogic.com/compresearch/papers/JCR07-2.pdf>

Jones, Michael. What do managers do during major organisational change. Proceedings of the 2010 IABR & ITLC Conference, The Clute Institute for Academic Research, Littleton, Co., 2010.pp1-16..

Kaplan, Robert & Norton, David. ‘Using the Balanced Scorecard as a Strategic Management System.’ Harvard Business Review, 2007. pp.10

Kaplan, Sarah & Henderson. Organizational Rigidity, Incentives And Technological Change: Insights From Organizational Economics?, 2007. <http://web.mit.edu/rhenders/www/WorkingPapers/Kaplan_Henderson_Incentives_Techchange.pdf>

Lant, Theresa & Mezias, Stephen. ‘Managing Discontinous Change: A Simulation Study of Organizational Learning and Enterpreneurship.’ Strategic Management Journal, Vol. 11, 1990. pp.147-179. <http://pages.stern.nyu.edu/~smezias/1paper.pdf>

Latta, Gail. ‘A Process Model of Organizational Change in Cultural Context (OC3 Model): The Impact of Organizational Culture on Leading Change.’ Journal of Leadership & Organizational Studies, Vol 16 No. 1, 2009. pp19-37

Lehman, Wayne E., Greener, Jack M. & Simpson, Dwayne. ‘Assessing organizational readiness for change.’ Journal of Substance Abuse Treatment, Vol 22, 2002.pp 197 – 209

Munive-Herandez, E.J., Dewhurst, F.W., Pritchard, M.C., & Barber, K.D. Modelling the strategy management process: An initial BPM approach. Business Process Management Journal. 2004.Vol.10, Iss. 6; pg. 691

Weick, Karl & Quinn, Robert. ‘Organizational Change And Development.’ Annual Review Psychology, Vol. 50, 1999. pp361-386