Nonprofit organizations are arguably in a perpetual state of change. Nonprofits must constantly scan, analyze, and adapt to the implications of the changing needs of clients, the community, funders, and government policy. Hence, the core competencies and capabilities of nonprofits must include how to effectively manage change. The knowledge, skills, and abilities of employees, volunteers, and managers must include the competencies required to formulate and implement strategies to manage planned and unplanned change. This book brings to the forefront the challenges and opportunities of change by combining insights from practice, research, and theories of change management to examine nonprofits. It incorporates interdisciplinary perspectives to examine the dimensions, determinants, and outcomes of change in nonprofits. It offers managers, researchers, and students case examples on how to develop, implement, and manage change in the context of nonprofits. Readers will better understand the dimensions of change that are unique to nonprofits and how these should be integrated into strategy and day-to-day operations, including reflection for both the change agent and the change recipient.
Imagine a world in which organizations produce the same goods and provide the same services year after year without variation. Their environment is permanently super stable, they are certain that the government policies that are likely to affect them will definitely be the same in the short-term and long-term. Competition is not a factor because it takes many years for any organization to develop a new product, service or modify a current one. Moreover, the people who consume the products and use the services of the organizations are the same. Demography is generally moving in the same direction. Individual and community needs are clearly defined without whims or social and personality factors. In short, the general and industry environment of organizations are bastions of stability. To top it all up, we can imagine that technology is also in a state of inertia . Software, apps, automation, and artificial intelligence are barely in the picture or very slow moving at best. Organizations that operate in this utopian environment do not need to worry about anything except the nature of their stable conditions. They adapt to what they know will happen and how they know it will happen.
An environment characterized by stability as envisioned in the scenario is not only highly improbable, itâs simply fiction. The nature of the environment of organizations especially nonprofits is not just change, it is constant change. Nonprofit organizations are arguably in a perpetual state of change. For example, they must constantly scan, analyze, and adapt to the changing needs of clients, the community, funders , the government , and other stakeholders . As the first step, nonprofit organizations and their stakeholders must understand what organizational change is all about.
Organizational Change
Change is the total opposite of the utopian scenario above. Change is unceasing in organizations. The external and internal environments of organizations always change. It is therefore an imperative that organizations must recognize, plan for, and adapt to change in order to survive and be effective. For most people, the notion of change is framed from the glimpses in the news media about corporate restructuring, mergers, acquisition, downsizing, and outsourcing. As illustrated in the example of the Heinz plant in Leamington, Ontario, Canada, organizational change is complex. The change that started with the acquisition of the Heinz Tomato plant became restructuring and later the closure of the plant. While the management, employees , and the community were working together to manage and adapt to the change, it transitioned to another acquisition. The second acquisition involved significant form of organizational transformation. Before we explore the narrative and complex nature of change, we need to first explain what we mean by organizational change in this book (Fig. 1.1).
Fig. 1.1
Heinz tomato plant
(Source Financial Post, December 30, 2015, http://âbusiness.âfinancialpost.âcom/âexecutive/âmanagement-hr/âhow-leamington-ont-where-the-tomato-is-king-rallied-to-save-its-heinz-plant)
Organizational change involves some form of planned alteration of organizational components to improve the effectiveness of the organization (Cawsey and Deszca 2007). This explanation includes different elements of change. For one, it emphasizes that an organization is made up of components. In other words, it highlights a systems perspective in which all the elements of the organization as a system are interrelated and interdependent (Katz and Kahn 1978). To understand change, one must first remember this principle. From a change perspective, any change and change management strategy in one subsystem or component of an organization could have an impact on other subsystems of the organization. The subsystems of an organization including the culture as well as the key componentsâthe mission , strategy, process, and of course, peopleâare critical to help us to understand change. Any substantive change in either the general or competitive environment of the organization would necessitate a need to realign one or more of the components by implementing a change management initiative. The systems perspective is valuable to understand that, a change in the subsystems or components could help to enhance not only the outcomes of the particular subsystems but the effectiveness of the organization.
Importantly, change as a systems process suggests that there are several factors at play in organizational change. The factors are important to understand change and to develop the competencies for effective change management. In this chapter and throughout this book, we will highlight four overarching factors to explain change: paradox , content, process, and context (Armenakis and Bedeian 1999; Palmer et al. 2006). These four overarching factors encapsulate the numerous factors that are relevant to explain change.
Change Content
Organizational change must have content. This means that the focus of change must be related to issues about the particular content. Following from the subsystems and components of organizations, research has shown that organizational factors such as human resource practices, culture, structure, technology , or quality management are often the content of change developed to address specific performance gaps (Self et al. 2007). The factors are elements of organizational practices that support and underlie the systems, processes, and outcomes. For example, organizational culture is generally a factor in change that is designed to drive organizational effectiveness. As Aetna the managed healthcare company realized in the early 2000, an organization cannot âtrade your companyâs culture in as if it were a used car. For all its benefits and blemishes, itâs a legacy that remains uniquely yoursâ (Katzenbach et al. 2012, p. 3). Organizational culture was clearly a factor in the turnaround of the company because the new leadership deployed culture to effect behavioral change that resulted in systemic change for patients and the healthcare providers.
Change Process
Change must also have a process. How will change play out? What specific steps will be used to develop, implement, and institutionalize change? These questions are basically about the âhowâ factor in change. Process explains the methods that will be used to introduce, facilitate, actualize, and reinforce change. Typically, the change process will indicate the phases or steps to be undertaken to ensure that change is effective. It has been suggested that the knowledge of how to plan and implement organizational change is limited because of the pace and challenges of change (Whelan-Berry and Somerville 2010). In addition, one should not forget that change is first and foremost about people. Therefore complexity characterized by the twists and turns noted above is one of the characteristics of the change process .
Change Management
The importance of process has contributed to the emergence of change management. This could explain why many scholars and practitioners have focused on organizational change in terms of the management process and the critical role of managers in change. This lens contends that managing organizational change is a way of addressing the issue of moving an organization as a system from point A to point B in the most effective and efficient manner (Zimmerman 1993). To achieve this goal, change management adopts a systematic process to apply knowledge, skills, and resources to transform the organization from the current state to a future change state (Rajagopalan and Spreitzer 1997). Often, the change management is about strategic change , the alignment or realignment of the strategy with the environment of the organization through a systematic process that managers implement to improve the effectiveness of the organization in the face of disruption, op...
