The impact of organizational change on HR management practices and company performance

Research Paper (undergraduate), 2017
18 Pages, Grade: MA



Literature Review

Research objective and tasks

Research Design and Methodology

Project Schedule

Ethics consideration



In recent years, the global economy is undergoing profound structural changes. Globalization, the constant change of inter-sectoral boundaries and even their disappearance, the intensive change of technology, the promotion of knowledge in the first place among the driving forces of competition, the emergence of new organizational forms, mass mergers and acquisitions are forcing modern organizations to constantly change. Changes are becoming a key element of modern theories of organization and strategic management. As part of the resource approach to the organization, one of the key competitive advantages of a company is the presence of its dynamic abilities - the ability to realize the need to change, and then to reconfigure internal and external competences to use the opportunities created by the rapidly changing environment. Thus, modern scientists believe that the ability to change on time and in the right way becomes one of the determining factors for the survival and success of any organization (Millar et al. 2012).

Changes constitute the meaning of modern organizations activity. In a constantly changing environment, their development is not only a result of natural evolution but also the result of a focused effort by management and personnel service. One of the forms of development of an organization is represented by organizational changes, which, in turn, predetermine changes in the content of management activities: it is less focused on administration and more on changes. The conditions of organizational change require "creative management" that promotes the generation of new knowledge, ideas, and their natural perception by managers at all levels and staff (Golkar 2011). In line with this, organizational changes are becoming one of the most significant factors in improving the management of an economic entity, which necessitates modernizing approaches to human resource management and giving new status to HR services. At the same time, organizational changes not only provide for meeting existing needs but also create new needs for employees and enterprises (Carter et al. 2001).

Another important tendency of modern theory and practice of management is increased attention to company employees as a key resource for competitiveness and long-term development of an organization in unpredictable and complex environment, the importance of which increases in a situation of increasing labor mobility, the emergence of "knowledge workers," growth of intensive "production" in the economy (as opposed to capital- and labor-intensive ones) and the service sector. Thus, the tasks of change management and the organization's ability to sustainable change are transformed into tasks of human resource management.

Despite the recognition of the relevance of this issue by both theorists and management practitioners, and despite the fact that the main idea of any organizational changes is to ensure successful long-term development of the company, numerous empirical data show that the transformations often do not achieve their goals or are accompanied by a decline in performance indicators. In our opinion, one of the problems of theoretical developments in this area is the universalism of the conclusions and recommendations, which do not correspond to the complexity and multifacetedness of modern companies and the environment in which they exist.

Analysis of specialized literary and regulatory materials indicates the absence of any methodological developments that contain methods for assessing the effectiveness of HR management in the face of organizational changes and the program for its reforming. The increased importance of HR management in the unstable organizational environment, on the one hand, and the presence of a large number of unresolved issues, their insufficient research in scientific papers on the other, indicate the relevance of this problem and predetermine the choice of topic, structure, and content of the assumed research.

Literature Review

Disclosing the degree of scientific development of the problem, it should be noted that the phenomenon of organizational change itself has a rather long history of theoretical research. During the period from the moment of emergence of interest in organizational changes in the middle of the 20th century to the present day, a considerable amount of knowledge on this topic has been formed in the scientific literature and periodicals. However, a unified theory of organizational change does not exist; this branch of science is characterized by a pluralism of opinions.

In the 1950s-1970s, some authors developed the concepts of organizational change, which, for a long time, dominated the literature on organizational change and retained their influence today (K. Lewin, R. Blake, J. Mouton, L. Greiner, C. Bell, W. Freeh) (Myers et al. 2012). Following these authors, in a significant number of works, the phenomenon of organizational change is viewed from a universalist point of view, as planned and under the full control of a leader. In the last 15-20 years, a new wave of work on organizational changes emerged, introducing a situational approach to change management, an idea of incomplete predictability of changes, as well as models borrowed from other (mostly, natural) sciences and enriching the idea of this phenomenon (M. Tushman, E Romanelli, A. Van de Ven, A. Pettigrew, C. Weick, D. Stace, D. Dunphy, R. Marshak, I. Palmer, B. Lichtenstein, Q. Huy) (Demers 2007). Nevertheless, in our opinion, one of the problems of theoretical developments in the field of organizational change remains the dominant universalism of conclusions and recommendations that do not take into account the differences in various types of changes, as well as the specifics of the industry, organization life cycle, national and corporate culture, the specific situation, etc.

From a systematic point of view, researchers can be divided into two groups: the first study organizational changes as a process of "transformation," "reform," "reengineering," etc. The authors of this group include Carter, Dutta, Khosa, and some other.

The second group consolidates the methodological problems of managing change and overcoming the resistance of the organization’s personnel. Particular contributions were made by the works of I. Adizes, P. Drucker, S. Covey, J.P. Cotter, D. Cohen, K. Levin and others (Spector 2006).

V.Yu. Kotelnikov, IK Mcmillan, M. Morris, A. Osterwalder, G. Hamel, J. Henderson, and others pay attention to the issue of business models (Myers et al. 2012).

According to Zupljanin and Mladenka, changes in the organization are identical to changes in the behavior of specific employees. The main reason for the unsuccessful changes, from their point of view, is that the leaders manage the transformation of the organization, not its specific employees (Zupljanin & Mladenka 2015). To solve this problem, as early as in 2001, the ADKAR model (Demers 2007) was proposed: Awareness - awareness of the need for change; Desire - the desire to introduce change; Knowledge - knowledge/skills; Ability - the ability to introduce change; Reinforcement - motivation for action/incentives. The logic of the model is to simultaneously manage the implementation project and employees changes.

Tummers et al. believe that for studying the state of the HR management mechanism in the face of organizational changes, a systematic and orderly approach to this process is important. To analyze the mechanism, a certain methodological basis is necessary (Tummers et al. 2015). In the context of organizational changes, the implementation of the HR management mechanism provides for the redistribution of functions, powers, resources within the organization, which gives rise to some contradictions, including the following: between the tasks of the administration in the face of organizational changes and the interests of management entities, resulting in resistance to change; between the increasing independence of certain categories of personnel and the necessary mobility for the implementation of organizational changes; between specialized intra-organizational entities (human resources department, technical and vocational training, sociologists and psychologists, etc.) and non-specialized management entities (shareholders, top management, heads of departments and services, etc.); between theory and practice of HR management and theory of innovation management (Long 2013; Tummers et al. 2015).

According to Ramezan, HR management in the face of organizational changes should be reformed in such a way as to meet the new requirements that determine the company's orientation towards achieving maximum results in the reorganization process. An important condition for solving the task is the development of an integrated system for reforming the HR management mechanism, which should comply with the following principles (Ramezan et al. 2013): 1) the principles of consistency - the mechanism of HR management is considered as a system (then, the elements of the HR management mechanism are its subsystems); 2) the target principle - the main goal of an integrated system of reforming the HR management mechanism in the face of organizational changes is differentiated into the goals of its subsystems, which, in turn, are brought to the level of specific tasks of personnel at various levels and specialized personnel management services; 3) the principle of complexity - the developed system covers all types and components of management activities; the relationship and interaction of all employees and all structural units of the enterprise, as well as levels of organization (group of companies, headquarters, enterprise, workshop, site, workplace).

Other researchers note that, in preparing for innovations and changes, many forget, overlook the fact that any change is preceded by a so-called transitional period. The concepts of "transitional period" and "change" must be distinguished. Thus, change characterizes a certain already accomplished situation, and a transitional period is a process during which people learn, understand, and accept the conditions of a new situation. For change to be successfully realized, it is necessary to manage people during the transition period. After all, changes in organizations affect people, and, namely, people have to learn and implement them (Ghitulescu 2013).

In this case, intergroup coordination of corporate goals, presented in the form of a symbolic image of an ideal organization, determines the maintenance and development of trends in the dynamics of socio-psychological phenomena for a long time. A shared image of an ideal organization can direct and regulate the actions of managers and serve as a basis for developing specific goals. Having become the agreed basis of social categorization, the image of an ideal organization determines the choice by different employees of actions relevant to the changes being made (Khosa et al. 2015; Shipton et al. 2012).

The reorganization of the structure and management system while ignoring intergroup coordination of corporate goals determines a short-term change in the dynamics of socio-psychological phenomena and their reverse dynamics, directed towards the initial configuration of socio-psychological phenomena (Kuipers et al. 2014; Salanova and Schaufeli 2008). In the light of this tendency, the tasks of change management and the development of an organization's ability to permanently change are transformed, in our opinion, into tasks of human resource management in the broad sense of the concept.

On the one hand, the study of the problem, based on cultural prerequisites and empirical material, may allow overcoming the "blinders" of the traditional approach and its shortcomings and enrich organizational theory with new concepts. On the other hand, empirical testing of existing change management concepts would determine the limits of their applicability and allow developing recommendations that may be useful for practitioners. However, to develop research in this area, it is important to understand the essence of the basic concepts of organizational change that exist today, their prerequisites and limitations, advantages and disadvantages, and key differences from each other. In our opinion, the complex comparative analysis of various theoretical concepts of organizational change, and the study of this phenomenon from the position of HR management and situational approach give particular value to this work.

Research objective and tasks

The purpose of the study is to comprehensively analyze the phenomenon of organizational change and study the influence of its characteristics on the efficiency of companies, especially, in the field of HR management.

To achieve the goal, the following tasks were formulated:

1. To analyze the scientific and practical literature on the subject, with the aim to systematize categorically the phenomenon of organizational change, to identify key theoretical concepts of organizational change, and to study the associated practical recommendations for managing organizational change, including on HR management in the period of organizational change.
2. To conduct a comparative analysis of the basic concepts of organizational change and propose a scheme for their classification.
3. To study current trends and features of the theory and practice of organizational change, to analyze the main problems and current development problems.
4. To study the specifics of the empirical study of the phenomenon of organizational change and develop a methodology and research tools that meet the specifics of the corporate culture.
5. To identify the main trends in the content of organizational changes and methods for their implementation (based on empirical research on the example of companies).
6. To identify the relationship between the characteristics of the content and process of organizational change, their performance, and the effectiveness of the company.
7. To identify the most effective models of HR management in the period of organizational change.


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The impact of organizational change on HR management practices and company performance
Oregon State University
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Nadiia Kudriashova (Author), 2017, The impact of organizational change on HR management practices and company performance, Munich, GRIN Verlag,


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