Factors Influencing Organizational Change

What is change?

Change refers to any fundamental adjustment or reorganization of one or all of an organization’s aspects, e.g., redesigning the overall structure or changing the mode of production or even replacing employees with technology, or changing from one level of technology to another.

Indeed, in the recent past, many changes have taken place in many organizations both locally and globally.

There has been a lot of downsizing both in the public and private sectors. There also have been several mergers, acquisitions, buyouts, and even changes in management style. These are because many changes have occurred both within the firms and in the broader external environment or society within which these firms operate.

All firms are environment-dependent: they depend on their inputs and for discharging their outputs. The firms’ strategies are affected by the environment, and managers must realize that although they cannot influence certain factors of their environment, they must always redesign their strategy in response to pressures created by the environment.

Factors Influencing Organizational Change

Globalization

There is now a realization that people can set up trade bases in other countries, unlike in the past when trade was restricted to purely domestic markets. Companies are now operating globally; a lot of multinational businesses have come up with several productive subsidiaries abroad. Size has now become a critical factor for success alongside entry into foreign markets.

Technological developments

Most departments are computerized, and the service industry uses IT to improve what it offers to customers.

Threatening tactics of competitors

There has been a lot of competition due to liberalization. Tactics such as drastically cutting prices and ‗dangerous ‘advertising have been used.

The entry of many newcomers with competing products or services

For a long time, the monopoly has been rife with particular firms being sole producers of a certain product. Now many entrants are offering competing products. Survival now depends on the strategies one uses to market their product or service.

Customer needs

The essence of business is the customer. Unlike the traditional customer who bought what was on sale, today’s customer has needs and preferences, which must be satisfied. Firms are also aware of the existence of a middle-class group of customers who have different needs from the low income-earning customer. Customers’ focus is now a significant starting point for many firms’ actions.

A new perspective of the Human Resource

Unlike the previous years, the human resource is now considered the firm’s most valuable resource. The Human Resource department is now instrumental in most firms, and a lot is being done to keep the firm’s most valuable asset happy and productive.

Political stability

Stability is a primary consideration for investors who are eager to be assured that their investment is safe within the country. In many countries, a relative amount of stability has attracted several investors. Simultaneously, a few disruptions and speculations about the stability have led several investors to close up and relocate their business.

Lobby groups

Lobby groups, especially those furthering the cause of women and minority groups, have been keys agents of change in many organizations. They demand equal employment opportunities and respect for the rights and dignity of women at work. They look into issues of discrimination by employers. Some groups are pushing firms to be environmentally conscious such as the Green Belt Movement. Firms have had to incur extra costs to comply with their demands.

Demographic pattern

There are still a lot of unskilled people seeking employment, thus making casual employment a continued possibility. Many changes have also taken place in the provision of degree, master’s, and doctoral programs. There are now much-qualified personnel seeking employment at managerial levels and whose needs firms must cater for. Changes in the demographic pattern also imply a shift in customer demands and requirements.

Pandemic like COVID-19

This affects all employers, as productive citizens were forced to stay home to avoid the pandemic’s spread. The pandemic forced many organizations to adopt remote working and incorporate technologies like video conferencing and reporting. This also causes many companies to lay off staff, and others adopted working in shifts. This was a major disruptor that has caused unprecedented changes in many organizations.