Management Theories for Managing Organisational Change

What forms of managerial power are most useful in managing organizational change processes?

An organizational change is a transformational process taking place in an organization due to mergers, re-designing or changes to the organizational management structure. Change could be strategic or institutional. (Journal 2010 Cited in Jansson, 2013). The process mostly involves altering the constitution, strategies, functioning methods, technologies and organizational culture to efficiently maintain the transformation within the organization. The main factors of causing organizational change could be economical, political or financial. The organizational transformation process could be a constant practice or it may take place only within specific period of time. Therefore, it is always important to have the most effective managerial power to manage organizational change process as if not managed by appropriate management power it could lead to many consequences such as job losses, employees suffering from stress, running the business in loss or else closure of the business. This essay will be addressing the forms of managerial powers that are most useful to manage organizational change effectively.

The concepts of ‘change agency’ and ‘transformational leadership’ were established with the increase of basic corporate transformations in 1980’s. However, even though the concept of ‘change agent’ originated from Kurt Lewin (1890-1947), Kotter and other theorists supported their work by the fundamentals of Kurt Lewin from the 80’s onwards. As it’s described by Bernard Burnes 2009, change agent should be a sensible individual who identifies, direct and manage feedback during implementation of organizational change. Organizational change needs to be effectively planned and managed to obtain the necessary preferred outcomes. In order to manage organizational change there is a need of a highly skilled managerial leader who could effectively manage the implementation.

Leadership has been given many classifications. Generally, it is a mixture of behaviours and judgments taken to guide a group of people towards agreed goals and objectives. Yuki,G 1989 describes leadership has individuals traits where a behaviour of a leader includes interaction patterns, work based relationship with co-workers which influence towards organizational goals. Trait theory assumes that leaders are born with inherited leadership characteristics, where behaviour theory describes leadership could be learned, situational theory argues that leaders depends on the actions taken in a particular situation and transformational theory states that an individual with appropriate vision and passion could be a leader to achieve desired goals(Carroll et al., 2008) . As there is not any specific leadership theory that could define exactly how leadership could be described all leadership situations a recovery process that employees could be redirected to the required goals in an organizational change process with effective leadership within the organization. (Carroll et al., 2008)

Transformational leaders are known as fascinating heroes and change champions as they have characteristics which is ideal for directing and controlling but inspiring and empowering other employees to strengthen change. Heifetz (1995) argued that leadership and authority should be differentiated as a ‘lone warrior’ cannot take responsibility for all actions if he/she is unsuited to answer them.

Landells and Albrecht 2017 explain that power and politics plays an important role in an organization’s change process with regardless the size of the business. It involves governing how decisions are made to the ways employees interact with one another. Organizational politics were identified as a significant feature of change (French and Raveen 1959). Employees choose positive or negative power to influence others in the workplace. Politics may directly influence the person who has the power and determines whether the overall culture of the workplace needs to be changed to increase the productivity. Building a positive managerial vision includes facilitating the employees with clear communication and higher levels of performances. Managers will have higher authority and will take an important role planning and budgeting in an organizational change process.

According to the Jalilvand and Nasrolahi 2015, Managerial power relates to a relationship which is socially exchanging with positive outcomes such as strong affective commitment within employees of an organization to work towards objectives and goals. When an employee obtained managerial powers, they feel more emotionally involved and committed to the organizations and have the authority to manage other employees.

Kanter (1979) cited in LANDELLS and ALBRECHT, 2017 states that power assembles and get things done and the production of managerial power will be positive but argues when there is no power the system does not work. Most employees who are with managerial powers are usually high earners but managerial power theory could be argued as higher rewards are not always appropriate, not all employees on managerial powers are high performers.

John French and Bertram carried out one of the most prominent studies on power (French and Raven, in 1959). The five types of powers which were identified initially were legitimate power which describes an official right to make demands and to expect respect from other assistant employees, Reward power which refers to an individual’s ability to compensate another for accomplishment, Expert power which is based on a person’s expertise skills and knowledge on a particular task. Referent power is an effect of a person’s superficial of charisma, worthiness, and right to obtain respect from others. Coercive power is a type of power to psychological punish if the requirements are not met.

Legitimate power is described as the power which has been owned by the gratitude of the managerial position held by an individual in the organization. The individual who is identified and recognized as the leader has superior rights and more responsibilities than other employees. Consequently, the leader has the authority to control and demand those employees who are lower in the managerial hierarchy as dependent and followers. (French and Raven, 1959). In an organization’s power structure every leader has a higher authority to answer except in a situation that the individual occupies the highest position in an organizational pyramid. A leader who has legitimate power could take more responsibilities from their seniors and pass the current responsibilities to the employees who are lower than that position. Legitimate power could be found at all the levels of an organizational managerial hierarchy, failure of ensuring the boundaries could lead to the unlawful use of power. (Mohammed and Leila, 2015)

Coercive power is referred as ‘psychological or material punishment’ (French and Raven, 1959). According to Kotter, it is known as the individual’s ability to get others to do what is required and not required. As well this avoids being forced by others to do what the individual does not want to do (1979). Such influence can be explicit as both forms are subconscious in management but could be identified in different forms and consider coercive power as ‘a double-edged sword’ (Pettigrew, 1956). While it cannot be functioned and non-empowering (Emmanuel Ogbonna, 2003), it may be used to improve one’s reputation for change in the organization (Buchannan & Badham, 1999). This type of power does not recognize the thoughts and feelings of other individuals or all the values of the organization unless it wants to control them to meet its own agenda. (R, K Smollan 2009).

Expert power is described as ‘specialist knowledge and expertise’ (French and Raven, 1959). This power could be defined as an individual’s ability to solve specific tasks such as technical, plumbing etc. The employees who are particularly skilled carrying out different specialize tasks with their own knowledge would become leaders without acquiring a formal position. This type leadership will be very important when managing change in an organization as change can be unpredictable. According to Lewicki and Litterer (1985), employees lean towards knowledgeable and skilled managers with respect in order to learn new skills and enhance their current knowledge. Although in order to use expert power being able to access the required information is a must as access to the information could be forbidden, so there is less opportunity to use this power (Singh, 2009).

Reward Power could be defined as the ability to influence other individual’s behaviours by agreeing to provide benefits. (Lunenburg, 2012). The individuals who have the authority to provide these benefits are seen as those who are in power. (Harold E. Fuqua, n.d.). The rewards/ benefits that could be offered can be tangible or intangible such as Pay rise, Bonuses, Promotions Positive Feedback, Recognition, more responsibilities (Lunenburg, 2012). Disadvantages of reward power could lead employees engaging in unethical work or illegal behaviour and sometimes managers do not have the ability to reward without required approval of senior management. (Tools, 2016) Reward power can also be compared to the Coercive power and can be used as a combination to maintain legitimate power (Mossholder, 1998).

Referent power is known as ‘charisma’ (1959) which is the ability of an individual to convey a sense of personal acceptance or approval by others (Business Insider). Vivian Giang (2013) also suggests that this is the most valuable form of power as to manage employee’s ability to get a sense of personal acceptance and respect when working together is useful. French and Raven (1959) argue that referent power is not the best choice for a leader to be used alone as misuse of referent power could cause many other problems such as employees getting neglected, stressed and over worked but due to the respect towards the manager, individuals/ teams of employees would not be open to inform about the workload rather they will stress themselves. As stated if referent power is being used with an expert power it could lead to success.

However, later on, informational power is often quoted as another form of managerial power (Raven, 2008). According to Raven’s earlier studies (1965), it’s the ability of an individual to influence the change through the resource of information. It is important to know the appropriate information regarding a change in order to carry out the change process as if unable to obtain required information the change process will not be successful. Characteristics of informational power lie in having control over specific information in the process of managing organizational change that others need or want put the manager in a powerful position.

Managers could put effort to influence co- employees by access and control of information this could be useful to restrict any information that need not to know by the subordinates and this may be used in both personal and positional classifications. Also it is among the most preferable power characteristics which lead to initialised to lasting changes in the target’s beliefs, attitudes and values (Raven, 1965).

However, even though there are other categorizations of powers available these are the fundamental powers most used commonly and mentioned powers to analyze and contrast managerial powers within the perspective of organizational transformation.

In conclusion, as stated in the introduction the essay addressed the possible reasons for organizational change to take place by introducing change agent, leadership, and characteristics of the main forms of managerial powers within an organization by evaluating and analyzing each form of managerial power critically. As stated above access to the relevant information and the ability to change co-workers to re-shape according to the organizational change taking place is a key of an ideal change agent. It is complicated to choose and identify a most useful and recommended form of a managerial power, as all the described forms of managerial powers is combination of an appropriate managerial power. It is also the individual’s responsibility to use the appropriate type of power for the most appropriate situation. Even though the distribution of leadership could benefit the organization in an organizational change the power should not be forced nor used authoritatively.

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