Organizational Development

CRITICAL THINKING REPORT

"Understanding the Impact of Organizational Change on Human Resources: The Roles, Processes and Challenges."

ABSTACT

Given the accelerating rate of global-scale change, organizational change and development have become more critical to organization success and ultimate survival. This report includes comprehensive discussion on the impact of organizational change on human resources. The discussion involves the roles of human resources when formulating and implementing the various approaches during change processes as well as the challenges faced by organizations for continual change. The changes proposed in this report are mainly focus on enhancing people's commitment, motivation and inspiration due to the fact that the success of change more than ever depends on the people in organizations.

(98 words)

INTRODUCTION

In a dynamic business environment, change is inevitable. Changing consumer lifestyles, technological breakthroughs, economic fluctuations, and high level of competition all act on the organizations to cause it to change. In order to survive in today's corporate world, organizations must have the capacity to adapt to changing condition. Thus, organizational change has become widespread in current global business environment. The purpose of this report is to illustrate the impact of organizational change on human resources. The discussion involves the HR function, various approaches to change and the challenges for effective change.

Organizational Change and Development

According to Brown and Harvey (2006, 3), organizational development comprises the long-range effort to improve an organization's ability to cope with change and its problem-solving and renewal processes through effective and collaborative management of organization culture. Organizational change develops the potential of individual members and achieves corporate excellence by integrating the desires of individuals with organizational goals.

Furthermore, organizational change stresses learning as a characteristic of an adaptive organization - the ability to sense changes in signals from both internal and external environment and adapt accordingly. Organizations incorporate continuous learning into its renewal process to keep pace with changing industry conditions. Albert (2006, 17) and Karp (2004, 350) state that organizations can create a key source of competitive advantage by developing its capability to learn and change faster than its competitors. The scarcest resource in many organizations today is not financial capital but innovation from human talent. Thus, the ability to compete and excel in the global economy goes beyond commercial trading and flows of capital and investment. Given the accelerating rate of global-scale change, learning and adaptation have become increasingly critical to organization success and ultimate survival.

The Roles of Human Resources

Organizational change attempts to increase productivity and effectiveness through invigorated employees who are able to develop creativity, imagination, and, above all, innovation. Managing change effectively can be a tough and complex challenge. Organizational change management requires leadership to function properly. Kotter (1995, 98) has acknowledged the formation of a guiding coalition as an important learning point from unsuccessful change initiatives. A recommended approach by Brown and Harvey (2006, 99) is a team consists of an external practitioner working directly with an internal practitioner to initiate and facilitate organizational change. The collaborative relationship between both practitioners provides an integration of abilities, skills, and resources. The external practitioners from outside the organization bring expertise, objectivity, and new insights to organization problems. In contrast, the internal practitioners often operate out of the human resources area. Lawler and Mohrman (2003) stress the significant role of human resources in the formulation and implementation of change strategies. They strongly suggest HR function as a strategic partner in helping the organizations to initiate change management by contributing comprehensive knowledge on organization issues and norms, a long-time acquaintance with employees, and an attentiveness of system strengths and weaknesses (Lawler and Mohrman, 2003; Brown and Harvey 2006, 100). Besides external-internal practitioner team, Karp (2004, 349) also acknowledged that the responsibility for change must be assigned to a broader range of internal and external stakeholders. In order to effectively manage change initiatives, a successful guiding team should involve the chairman, senior managers, board members, representatives from key customers, and even a union leader (Kotter 1995, 98). From the perspective of Kotter (1995, 98), it is necessary to include external stakeholder due to the fact that if the existing internal system is working well, there would be no need for organizational change. However, since the current system is inefficient, the change management thus demands activity outside of formal boundaries, prospects, and practices.

The Change Processes

There are many approaches available to facilitate leaders and managers to implement change. This report discusses the integration of people-oriented approach and sociotechnical systems approach to organizational change. It is important to note that the success of change more than ever depends on the people in organizations (Karp 2004; Lawler and Mohrman 2003; Brown and Harvey 2006, 3). Therefore, the change approaches discussed in this report will accentuate human behavioral factor follow by cultural, structural and technological factors.

1. Human Resource Approach

People-oriented approach emphasizes human behavior and the use of human resources. Successful organizational change must take account of the "people issues" as motivation and inspiration (Karp 2004, 351). Participation of members in the change program is crucial in motivating employees. Today, organizations are moving towards change programs that allow "everybody" to innovate and change based on the concept "everyone improves whole system" (Karp 2004, 350; Brown and Harvey 2006, 3). One of the change processes recommended by Karp (2004, 351) is appreciative inquiry (AI) which includes identification of our best times during the best situations in the past in an