There have been several theories of organizational change introduced in the last 50 years, but until around the year 2000, most can trace their origins back to Kurt Lewin's change theory from the 1940s. These theories break down the process of organizational change into three or four stages. Today, stage change theory is also combined with Rogers's Diffusion of Innovation theory, which categorizes people based on their affinity to accept change or resist it.
Many of these theories from the twentieth century either directly or indirectly asserted that changes in an organization are made from the top down. In the past 20 years, however, innovators and change leaders are not necessarily CEOs and upper management. They can be found at any level in an organization today, and once motivated, they can help effect change throughout an organization.
Lewin's Change Theory
Social scientist Kurt Lewin developed a well-known model for organizational change in the 1940s. The model is similar to changing a block of ice from one shape to another. It involves three steps: unfreeze, change and refreeze.
Stage One: Unfreeze
Organizations, like individuals, are often resistant to change. Consequently, it's important to prepare everyone involved to realize that change is necessary and is on the way. To warm them up to the idea of change, it's important to explain why the status quo is failing the organization or why it will fail in the near future. This involves challenging the organization's beliefs and behaviors and will ideally make the people involved re-examine what they are doing in a new light.
For example, if sales are declining or if customer complaints are increasing, it is necessary to point this out and to show the numbers and then show where it will lead them in the near future. Once the team has been given the facts, they will be unsettled and more open to the necessity of making changes. By doing this, you have essentially created a controlled crisis or even a hypothetical crisis that can more easily be managed now than if you had waited until the forecasted crisis unfolds for real.
Stage Two: Change
Once people understand that change is approaching one way or another, they are more motivated to seek out and adopt the changes that will benefit them. It's better, for example, to change your approach to sales or customer service than to see a company go out of business. Not everyone will want to accept the changes that have been proposed. Getting people on board takes time, good communication and management.
Stage Three: Refreeze
Once an organization has embraced change and the new policies, attitudes and behavior have begun to take hold, it is ready to refreeze. You will know that the changes have been set and are solid when new policies are being utilized consistently, employees have adopted to new job descriptions and the new behaviors and attitudes have become the new status quo.
While some companies may more readily adapt to change than others, a refreeze stage is still important for all organizations. Without it, people can become trapped in a constant state of change, uncertain about what should be done and how. Just as importantly, it's impossible to be certain whether or not new changes may be required if the last set of changes hasn't been given a chance to be thoroughly utilized.
David Garvin’s Model for Change
Professor David Garvin of the Harvard Business School uses a three-stage model for organizational change. It's similar to Lewin's model, but it more accurately suits today's workplace compared to Lewin's model, which is nearly 80 years old.
Stage One: Prepare the Organization for Change
This is similar to Lewin's unfreezing stage. However, Garvin recommends five specific steps that managers should take to prepare the organization:
- Begin by creating dissatisfaction with the status quo.
- Give the organization a sense of direction.
- Begin building a coalition to lead change in the organization.
- Create a new vision and a plan to lead the organization there.
- Convey this vision of the future in a way that is believable and compelling.
Stage Two: Alter How the Organization Does Business
The second stage involves changing employee behaviors as well as making changes to the company's business structures, systems, strategies and processes. The people in the organization should be encouraged to suggest changes in their own processes that would increase productivity. Garvin recommends that you:
- Define acceptable and unacceptable behaviors.
- Change key structures in the company and incentive systems.
- Communicate your vision to employees and management.
- Model the behavior you expect to see in others.
Stage Three: Ensuring Changes Stick
The equivalent to Lewin's refreezing stage, this is the stage in which managers need to ensure that the changes have been successfully adopted by the company's culture. You will have to monitor the company's new structures, controls, systems and incentives to make sure that employees don't revert to their old behaviors and attitudes. Furthermore, Garvin recommends that you review and monitor progress so that you can:
- Ensure changes are fully embedded into a new company culture.
- Prevent backsliding into the old ways of doing business.
- Fully institutionalize the new ways of doing business.
Rogers's Diffusion of Innovation Theory
The Diffusion of Innovation theory was developed in 1962 by E.M. Rogers. The theory was designed to explain how an idea or a product can gain momentum and then spread or diffuse over time through an organization or other social system. Before adopting a new idea or behavior, people must first perceive it as new or innovative. As more and more people also adopt the idea or behavior, it becomes diffused.
Adoption and diffusion take time because not everyone will adopt an innovative idea or a new behavior simultaneously. The key to Rogers's Diffusion of Innovation theory is to recognize the type of people who are more likely to adopt the new idea earlier than others and to understand personal characteristics that may hinder diffusion. A person's likelihood of adopting a new idea within an organization or other social structure can be classified in one of five categories.
These are individuals who like to be first when trying something new. They are generally adventurous and are willing to take risks. They will often try out new ideas or behaviors on their own. They don't require much persuasion if any at all to adopt changes in an organization.
These are the leaders in an organization, although they are not always in management positions. After the innovators, once they see there is a need for change, they will quickly adopt those changes as well. To encourage them, you can give them how-to manuals and information sheets on how to implement the desired change, and they will take it from there. They don't need much information to get started.
These people are not the leaders, but they will adopt new ideas and behaviors faster than average. They will first need to have some proof that the new ideas will work before they will adopt them. Give them success stories or case studies of an innovation's success to get them on board.
These people are usually skeptical of change and are reluctant to try new things until they see that others have already started. The more information you can share that illustrates how a lot of people are already using the new ideas, the more likely these people are to adopt them.
These are conservative people who embrace tradition and are skeptical of change. Getting them to change is often difficult. Lots of information on why the change is necessary and beneficial can help, as can peer pressure. In some cases, you may have to use the threat of disciplinary action to get them to change.
Four Steps in Personal Adoption of Change
According to the Diffusion of Innovation theory, all people go through the same stages when adopting an innovation regardless of how quickly or slowly they proceed.
- Awareness of the need for change.
- The decision to change or reject change.
- Initial use of the innovation.
- Continued use of the innovation.
Five Factors Influencing Adoption of Change
There are also five factors that influence whether or not someone will adopt an innovation regardless of the person's adopter category.
- Relative advantage: Whether or not an innovation appears to be better than what it is replacing.
- Compatibility: Whether or not the innovation is consistent with the person's values, experiences and needs.
- Complexity: How easy or difficult it is to understand and use the innovation.
- Triability: How easy or difficult it is to test the innovation before a commitment needs to be made.
- Observability: Whether or not the innovation provides tangible results.
Four-Stage Theory of Organizational Change
Another more modern theory of organizational change is called stage theory. It is also similar to Lewin's theory, but it involves four steps rather than three. It also incorporates Rogers's diffusion of innovations within each stage.
- Awareness of a problem and its possible solutions.
- A decision to adopt an innovation to solve the problem.
- Implementing the innovation while modifying organizational structures as required to accommodate the innovation.
- Institutionalization, or integrating the innovation into the organization's daily activities.
Within each of these stages, different leaders or change agents within the organization would be responsible for bringing the organization on board with the innovation. This would vary depending on the types of innovation being introduced and how receptive the people within the organization are to these specific innovations. Introducing a new computer system, for example, would require different leaders and a different approach than, say, introducing staff layoffs or cuts in salaries.
Democratization of Organizational Change
In the last 20 years, organizations have been evolving toward more employee empowerment and less requirements for middle management. This is largely due to advances in technology with collaborative software and more one-to-one communication with customers through email, instant messaging and social media. It is also due to a growing number of employees having multifaceted skills and interests that go beyond their current daily duties.
Front-line employees can usually see customer reactions to failed company policies, flawed products and poor service before anyone else in an organization. If asked, they are often likely to have ideas on how to implement changes throughout the organization to solve these problems. As organizations change and develop, new theories on organizational change management are now being developed. Rather than imposing change from the top management levels down, researchers are now encouraging organizations to elicit innovative ideas from all employees.
By shifting away from models that ask employees to implement changes defined by management, innovative ideas with employee input are today more likely to be successful in their adoption and diffusion. The organization is also more likely to uncover the innovators and early adopter leaders that may not have been utilized in top-down models of organizational change.
- MindTools: Lewin's Change Management Model
- Harvard Business School Online: A 3-Step Framework for Managing Organizational Change
- University of Pennsylvania Perelman School of Medicine: Stage Theory of Organizational Change
- Boston University School of Public Health: Diffusion of Innovation Theory
- Forbes: Why We Need to Rethink Organizational Change Management
- Forbes: Everybody Is A Change Agent: A New Anthropological Foundation For Change Management