Leading Change

â€Å"The harder you push, the harder the system pushes back† is the 2nd law in The Laws of the Fifth Discipline.   These laws are the core of a process called systems thinking and the concept is that it’s â€Å"best to manage the system, not just the individual processes.†Ã‚   (West & Cianfrani, 2004, p. 69)   Corporations have a tendency to look at the â€Å"direct linear cause and effect relationships,† rather than looking at â€Å"interactions.†Ã‚   (West & Cianfrani, 2004, p. 69)   Peter Senge’s book The Fifth Discipline identified 10 laws that defined systems thinking. The 2nd law in The Laws of the Fifth Discipline can be interpreted as â€Å"Compensating feedback.†Ã‚   Senge defines this as â€Å"when well-intentioned interventions call forth responses from the system that offset the benefits of the intervention.†Ã‚   (Senge, 1990, p. 58) In other words, the more effort exerted to change or improve the current organizational processes, the more effort it requires. Organizations have experienced this process when, for example, a product or brand suddenly begins to lose its popularity within the market.   When organizations begin to push new marketing strategies aggressively it often turns out that more revenue is spent on the marketing efforts with only a temporary pay back.   This process is not only limited to the business market, it can also be illustrated in personal experiences.   Senge uses the smoker as an example – if a person who is a regular smoker suddenly quits he or she might begin to gain weight, become frustrated with personal appearance and then suddenly begin smoking again.   (Senge, 1990, p. 59) As humans it is natural for us to get drawn into the process of compensating feedback.   We push harder and it’s exhausting and we often â€Å"glorify the suffering that ensues.†Ã‚   (Senge, 1990, p. 59)   When our efforts to produce change fail initially, we push harder and often have the belief that our hard work and effort will overcome all of the obstacles in front of us. However, compensating feedback is a process where we become blind to the fact that our efforts are actually contributing to the current obstacles we are facing as well as creating others we must overcome. (Senge, 1990, p. 59-60) Over the past two decades information and communication technology has continuously evolved and has empowered small businesses and large corporations with new emerging markets and tools.   The Internet has become the information highway and has impacted both social and economic relationships in various sectors such as education, health, government, trade and tourism.   (Waddell & Singh, 2003, p. vii) In order to maintain its impact on society the information technology must continuously evolve to compensate for future needs for both local and global societies.   (Waddell & Singh, 2003, p. VI)   Focusing on one idea or concept that does not elicit long-term success consumes time and effort that is imperative to online success. The consistent evolution of technology and the platforms provided are numerous and are impacting our society regularly.   These newly emerging technologies affect the way we do business, communicate with others, daily entertainment, study and do research.   (Waddell & Singh, 2003, p. VI)   Ecommerce is the largest growing platform of the World Wide Web and it has provided a â€Å"new momentum of doing business in the digital economy.†Ã‚   (Waddell & Singh, 2003, p. VI) In order to compensate and adjust to the constant change through the internet environment we must be able to identify the implications. At the end of 2004 it was estimated that 750 million users represented the Internet community worldwide.   (Waddell & Singh, 2003, p. VI) The e-marketplaces consist of various products and services that market their products both from Business to Business and Business to consumer.   These products and services provide value for both buyers and sellers. In order to create a successful ecommerce venture processes must be transformed from the traditional ways of doing business to modern Internet transactions that are efficient to both the buyer and the seller.   The biggest challenge for internet businesses is adapting to the virtual environment and integrating their current business processes into the e-marketplace. (Waddell & Singh, 2003, p. 97) The Internet environment has its benefits as well as disadvantages, or threats.   On a local business level it immediately provides â€Å"easy and fast entrance to new markets,† 24/7 business hours, less physical structure maintenance, and the possibility of sales increasing.   (Waddell & Singh, 2003, p. 99) For buyers this offers more selection of products and services, 24/7 business access and easy comparison between the various seller’s offers.     (Waddell & Singh, 2003, p. 99) Threats for businesses as a whole are the loss of direct customer face to face relationships, increased competition and the extra funds required for consistent upgrading of products and platforms.   (Waddell & Singh, 2003, p. 99)   For buyers there is the same lack of direct face to face relationships, the unknown reliability of the seller and lack of trust in products and services.   (Waddell & Singh, 2003, p. 99) E-commerce is about â€Å"rediscovering the individuality of the customers and their needs, and the creation of frictionless modes of commercial interaction with them.†Ã‚  Ã‚   (May, 2000, p. 4)   Businesses must approach change in an internet environment carefully, as in the traditional business model the direct interaction allows the consumer to feel important.   Ecommerce does not provide the close interaction; therefore it is imperative that the online business practices allow the consumer to feel like a person, not a type.   (May, 2000, p. 5) A great example of ecommerce success is Amazon.com.   This company has proven its ability to implement change and business growth without affecting its customer base or falling behind the competition.   The vision of the â€Å"Earth’s biggest bookstore† (May, 2000, p. 52) was to offer a range and large quantity of products that would dominate traditional booksellers and to â€Å"achieve market ubiquity without acquiring retail real estate.†Ã‚   (May, 2000, p. 52) Jeff Bezos identified books as an ideal product for selling online because the number of books the traditional bookseller could offer was limited; therefore, if these products were offered online the number available would be unlimited.   In a sense the book trade has always been â€Å"virtual† – any customer can enter a traditional bookstore and order any book in print. Amazon.com brought a new online concept to the book trade and improved the efficiency of a traditional process.   However, though this insight was extraordinary introducing the concept into the ecommerce marketplace meant that consistent change was necessary and that customers must receive the same attention and personal relationships currently experienced in the traditional environment.   (May, 2000, p. 53-54) In order to change the ecommerce impersonal environment Amazon.com had to introduce a new strategy into maintaining and increasing its customer base.   Changing the internet environment is not a simple display creation or the addition of a personable salesperson to physically approach customers.   Amazon.com had to approach this change with a technology based solution that offered a personal approach to its customers.   The applications Amazon implemented offered their customers a positive experience. Customers are now able to access their portfolios at any time and without interaction with a sales representative.   These portfolios are personalized and address customers on a first name basis, provide purchase history and even suggest similar titles that might be of interest to the customers.   This change provided a personal touch, saved Amazon on staff time and clearly benefits the customer.   (May, 2000, p. 54) Rick Berry, CEO of ICGCommerce.com, an Internet-Based procurement business, describes leading an e-commerce business as â€Å"driving a Ferrari with a cinderblock on the accelerator.†Ã‚   (Pandya, 2004)   This fast-paced environment requires consistent change, as â€Å"E-Procurement is a $10 trillion market worldwide.†Ã‚   (Pandya, 2004) Berry states that building a procurement business in the traditional sense would take at least 10 years to become successful; however within the internet environment they are making an attempt to establish credibility within six months.   Their goal is â€Å"to grab a chunk of that market before the competition moves in.†Ã‚   (Pandya, 2004) Berry believes that talent is what businesses require to provide effective leadership and the ability to change quickly within Internet based businesses.   Leadership must have the ability to â€Å"attract teams of talented risk-takers.†Ã‚   (Pandya, 2004)  Ã‚   The speed of the working environment in an e-commerce structure means that very little time is available to train staff; therefore leaders of e-commerce ventures â€Å"must strive to create a specific type of work culture† that is high-energy and results-oriented.   (Pandya, 2004) Because little time is allowed for training and communication in an internet environment is more direct than others, changing the actions of others as well as effectively communicating the vision of change is difficult.   â€Å"You communicate directly, and you must build a team that can cope with that.†Ã‚   (Pandya, 2004) If an internet company is to be successful it must begin with establishing a visionary culture with the ability to attract and retain talented staff.   Talented staff members have the ability to effectively introduce change within the internet environment effectively and without disrupting business flow. David Perry, founder of Chemdex says that creating a successful business with the ability to adapt to the constant change of the internet environment is â€Å"raising money, so you can hire good people, so you can make and sell good products, so you can raise more money.†Ã‚   (Pandya, 2004)   These staff members must be â€Å"enthusiastic, passionate and share the organization’s values.†Ã‚   (Pandya, 2004) In his article titled The True Value of Change Management, George Spafford quotes â€Å"The only constant is change.†Ã‚   (Spafford, 2005)   He believes that many IT organizations â€Å"lack a fundamental understanding of the need to manage change† and that these organizations feel that change management stops at budgetary planning. When introducing change into the internet environment organizations must understand that this process has huge impacts on business operations – the more complex the change is within the system the â€Å"effective change management processes† increase.   (Spafford, 2005)   As most change within the internet environment is technology based, it’s imperative to know that 80% of security breaches have been caused by human error. (Spafford, 2005) Potential solutions in technology have three parts â€Å"people, technology and process.†Ã‚   (Spafford, 2005)   Most organizations have processes in place where change requests are â€Å"submitted, reviewed, planned tested, scheduled and then implemented.† (Spafford, 2005)   The procedures are put into place to ensure that proper thought and planning have been applied and the implications assessed before introducing it within the business structure. Spafford believes that many organizations lack the resources to implement change and that many simply give up once the implications have surfaced with unsuccessful results.   He believes that companies must learn from their mistakes and work continuously to improve and implement future successes.   Developing one simple model of change in an internet environment can also be devastating.   â€Å"The point is to be flexible, keep costs down and remain responsive, adopting multiple change models.†Ã‚   (Spafford, 2005) The ability to manage change within the internet environment will always be a challenge for organizations.   Effective leadership is the key to any organization’s success as well as leadership’s ability to attract talented staff members who are constantly looking to the future, rather than traditional one-sided ideas. Technology is constantly evolving and introducing new competitive strategies into the ecommerce marketplace and little time is available to adapt to the competition.   Looking back at The Laws of the Fifth Discipline, â€Å"The harder you push, the harder the system pushes back† we see that it’s imperative to remain open-minded and constantly looking to the future where new concepts and ideas will introduce positive changes to the Internet environment. References May, P. (2000). The Business of Ecommerce: From Corporate Strategy to Technology. New York, New York: Cambridge University. Pandya, M. (2004). Center for Leadership and Change Management:   Leadership in E-Commerce:   What does it Take to Lead an E-Commerce Venture? Retrieved from http://leadership.wharton.upenn.edu/ecommerce/articles/Wharton_ECommerce_Forum.shtml Senge, P. M. (1990). The Fifth Discipline. New York, New York: Doubleday Dell Publishing Group. Spafford, G. (2005, August 15). Datamation:   The True Value of Change Management. Retrieved from http://itmanagement.earthweb.com/service/article.php/3527471 Waddell, D., & Singh, M. (2003). E-Business Innovation and Change Management. London: Idea Group Inc (IGI). West, J., & Cianfrani, C. A. (2004). Unlocking the Power of Your Qms: Keys to Business Performance Improvement. Milwaukee, Wisconsin: American Society for.          Leading Change Introduction Intense global competition, rapid technological change, and international capital markets are creating more demand for change leadership than at perhaps any other time in history. These forces, combined with the complexity of new and more global organizational forms that span nations and unite organizations through alliances, joint ventures, and mergers and acquisitions, make the job of leadership increasingly difficult. No wonder it is popular to suggest that leadership is in short supply in most organizations. Moreover, we have a limited understanding of the role that leaders should play in making effective change a reality. This is the motivation for this essay. In the pages that follow, I discuss how leaders can help organizations change to meet the challenges of the twenty-first century.Body of the Essay It is one thing to argue that organizations need to reinvent themselves and develop new, more effective approaches to organizing, and quite another to accomplish it . Large-scale organizational transformation is, at best, a developing art that has yet to produce any clear formulas for success, but more and more attention is being turned to executives as the principle agents of change and adaptation. It is increasingly common to assume that leadership plays the crucial role in an organization's successful adaptation to a changing world. Companies are paying record compensation to attract the best and brightest executive talent to lead them safely through today's turbulent business environment. Many boards and executive recruiters assume that there exists an elite corps of individuals who possess leadership skills that have almost universal application.The subject of leadership and organization change is embedded deeply in the lexicon and discourse of business executives, management consultants, and organizational scholars. Business periodicals, the trade press, and academic publications are brimming with information and knowledge about leading o rganization change. Widespread attention to leading change is largely a reflection of the times. Fueled by unprecedented changes in technologies, markets, and economies, organizations are experiencing rapidly changing environments and enormous competitive pressures. Responses to these challenges are resulting in a virtual revolution in new organizational forms and systems. Organizations are increasingly seeking to transform themselves to become more adaptable and competitive, with leaner, more flexible structures, more empowered and committed employees, and more performance-driven human resource practices. (Lawler et al., 1995)As organizations strive to implement these innovations, they discover that change is incredibly arduous, requiring a great deal of expertise, resources, and luck. The sheer difficulty of transforming organizations is evident in their enormous inertial qualities as well as the scope and magnitude of the required changes. Organization transformation typically in volves radical changes in strategy and structure, in work practices and methods, and in members' perceptions, norms, and work behaviors. As many observers have pointed out, because transformational change involves the total organization including strategic relationships with the competitive environment, top leaders or CEOs need to lead the change process and are essential to its success. (Tichy & Devanna, 1986; Greiner & Bhambri, 1989; Nadler, 1997)â€Å"The Harder You Push, The Harder The System Pushes Back† Any organization has its own corporate culture and the employees in all hierarchies are accustomed to that particular culture. Bringing about any change at any level is bound to shake the status quo and bring in an element of disturbance within the smooth functioning of the organization. Keeping that in mind, the change leader has to be extremely careful in doing the job and allowing ample space and time for the employees and other variables to adjust to the change being brought about. If the change process is accelerated too much and transformation is imposed hard on the people and the system as a whole, it will result in increased resistance from the system and mounting difficulties in the process of change.â€Å"Change involves moving from the known to the unknown (Cummins/Worley, 1993). Because the future is uncertain and may adversely affect people’s competencies, worth, and coping abilities, organizational members generally do not support change, unless compelling reasons convince them to do so. Similarly, organizations tend to be heavily invested in the status quo, and they resist changing it in the face of uncertain future benefits. Consequently, a key issue in planning for action is how to motivate commitment to organizational change, such as Business Reengineering. This requires management attention to two related tasks: creating readiness for change and overcoming resistance to change.† http://www.prosci.com/w_4.htmPeople c an be made ready to accept and contribute towards change once they themselves get to feel the need for change. This means making people so discontented with the status quo that they are provoked to try new ways of performing. Generating such discontent can be to a certain extent difficult. People who have been functioning and behaving in ways that have become norms for them now, may find it difficult to the level of hurt, prior to their undertaking the change seriously. In a situation as sensitive as such, the change has to be led very cautiously providing room for delay. The many issues related to change leadership could be structured around multiple themes. They include leader behaviors for effective change, sources of change, different change strategies, whether leadership really matters, and the development of change leaders.Most leadership scholars emphasize the importance of developing a vision or direction as the first step in leading change. This direction is critical in mak ing sure that everyone is moving in the same direction. It is, however, an open question whether a vision is really necessary for leading change. A key issue, particularly in the literature on charismatic leadership, is how to create a sense of empowerment and ownership for employees.One argument is that this requires giving employees the autonomy to determine appropriate means for implementing the vision. (Conger, 1989) Prior research has shown that employees are most motivated when they have the freedom to determine what works best given their talents and skills. (Spreitzer et al., 1997) However, in order for such autonomy to work employees must have access to the resources necessary for implementation and to information about the competition and the financial situation of their organization; without these they are likely to feel helpless in bringing about change. Also, rewards may be particularly helpful in building a sense of ownership. (Lawler, 1986)Leaders in crisis organizati ons facing a revitalization challenge must devote considerable effort at the front end of their transformation to the creation of resources. Individuals' resistance to change builds in direct proportion to the magnitude of the gap they perceive between the level of effort expected of them as part of the transformation process and the resources available to get the job done. Often this initial resource-generating step involves closing and consolidating peripheral or under-performing operations, trimming employee payrolls, reducing corporate staff overhead expenses, and suspending or deferring programs so that current operations can generate more cash to be redeployed to the launch of the corporate transformation process. Leaders attempting to revitalize their organizations also need to seek new external resources as they launch their transformation process.For example, at General Electric during the early 1980s under Jack Welch, the creation of slack resources was not so much a probl em as was the reallocation of existing resources to the corporate transformation effort. So the initial transformation issue was less one of resource creation than one of resource reallocation. Businesses that did not fit the vision had to fix, sell, or close themselves, and resources that would otherwise be consumed by these ill-fitting businesses were reallocated to enhance productivity and automation initiatives and to fuel capital investments in businesses that offered greater promise for achieving Welch's lofty vision of being first or second in their chosen global markets. (Aguilar et al., 1985)It might be argued that the key role for the leader is setting context; he or she must create a culture that embraces the importance of change. The leader then needs to create an organization structure that will support the new vision. This might, for example, involve a team-based design to reduce centralization, hierarchy, and bureaucratization. The leader must select and hire top-notc h people who have the skills necessary to bring the new vision to actuality. If the vision involves globalization, for example, this might involve hiring or promoting people who have international experience. The leader must also create a reward system that encourages behaviors appropriate for the new vision. For example, if the vision requires more focus on the customer, then employees must be rewarded for actions that improve customer satisfaction. In other words, the leader's most important role may be to devise an organization that sustains the vision.Implications For Change In An Internet Environment Sebastian  and Samuel  (2004) â€Å"explore the challenge that technology will deliver to management at both the tactical and strategic level. Changes in communication, content of communication, globalization of communication, are critical to these changes. The environment will support a greater degree of discontinuities in planning which is brought about by the globalization of management activities. Successful management must encompass the management of these discontinuities but use information in an artificial intelligence environment. The integration of these data and the actions that come from that integration must be understood within a moral framework.† (Sebastian  & Samuel, 2004)In the present era of technological innovation and globalization, when the world’s business is coming closer to work as a network, when the logistics are being designed in a way that encompass the ever so easy access of technology, communication and information, when a single business is catering to the markets around the globe, the changes within the organization become more important than those ever were. It is the international culture that the employees have to work in, the greater than ever expansion plans and newer and faster service demands that they have to attend to. All these developments and enhancements come as part and result of the Internet en vironment in which virtually all businesses are operating these days.ConclusionLeading change in such circumstances become an even more demanding and challenging of a task for the managers or leaders. As the trade of goods and services around the world is getting faster and easier, the need for as fast a change continues. However as mentioned in the preceding pages that such changes cannot be brought overnight, nor can those be imposed or pushed hard on the individuals. The system pushes back even harder and poses even more resistance to the change. Instead, the vision once established has to be communicated to the people properly, make them ready for the change by suitably establishing the loopholes of the current state and furnish the future expectations of being technologically sound and equipped.ReferencesAguilar, F. J., Hamermesh, R. G., and Brainard, C. General Electric, 1984. (1985) Boston: Harvard Business School Press (9–385–315, Rev. Mar. 24, 1993).Conger, J. A. (1989) â€Å"The Charismatic Leader† San Francisco: Jossey-Bass.Greiner, L., and Bhambri, A. (1989) â€Å"New CEO Intervention and Dynamics of Deliberate Strategic Change.† Strategic Management Journal, 10, 67–86.Lawler, E. E. (1986) â€Å"High-Involvement Management† San Francisco: Jossey-Bass, 1986.Lawler, E., Mohrman, S., and Ledford, G. (1995) â€Å"Creating High Performance Organizations: Practices and Results of Employee Involvement and Total Quality Management in Fortune 1000 Companies† San Francisco: Jossey-Bass.Nadler, D., (1997) â€Å"Champions of Change† San Francisco: Jossey-Bass.Spreitzer, G. M., Kizilos, M., and Nason, S. (1997) â€Å"A Dimensional Analysis of the Relationship Between Psychological Empowerment and Effectiveness, Satisfaction, and Strain.† Journal of Management, 23 (5), 679–704.Tichy, N., and Devanna, M. (1986) â€Å"The Transformation Leader† New York: Wiley.Wolf D. Schumacher â€Å"Ma naging Barriers To Re-engineering Success.† http://www.prosci.com/w_4.htm Accessed January 31, 2007.