Page 65 - Managing Change in Organizations

CarnCh03v3.qxd 3/30/07 4:11 PM Page 48

Chapter 3 ■ The transformation perspective
Our argument is that concepts such as transformational leadership, entrepre-
neurship and the learning organization each embrace these ideas. Beyond this we
recognize that major changes are typically implemented as major programmes
organized around simple themes (e.g. ‘right first time’ for total quality pro-
grammes or ‘next steps programme’ for major programmes of culture change).
A good example is that of ‘time-based competition’. The key idea is that the
way we manage time – whether in production, in new product development, in
sales and distribution – represents a powerful source of competitive advantage.
This idea has spawned another, that of ‘business process re-engineering’. At the
core of both is a strategy for change utilizing analytical techniques to analyse the
organization seeking continuous improvements to work and information flows
and to the use of time. The emphasis is on the organization doing the work itself,
utilizing its own people empowering people at all levels to achieve change.
Benchmarking is a key analytical technique utilized in such programmes, as are
techniques such as ‘pilots’ and ‘breakthrough teams’. According to Stalk and
Hout (1990) breakthrough teams should be given radical goals such as reducing
time by half in order that assumptions will be challenged. Bottlenecks, break-
downs, failures and unmet customer needs all become opportunities to learn. All
of this implies radically new ways of thinking about the organization.
Finally Argyris (1990) explains something of the constraints to achieving effec-
tive learning in organizations by pointing to the distinction between what he
calls single-loop and double-loop learning. At the core of his explanation are two
key points about professionals (managers and a growing proportion of employ-
ees are professionals or quasi-professionals of one sort or another):
1 Essentially the life experience of most professionals through schooling, uni-
versity and early career is characterized by success, not failure. Because they
have rarely failed they have never learned how to learn from failure. Thus
when things go wrong for them they become defensive, screen out criticism
and put the ‘blame’ on others. Ironically their ability to learn shuts down just
as they need it most.
2 In common with our earlier remarks, Argyris takes the view that organizations
assume that learning is a problem of motivation. Create the right structures of

communication, rewards and authority and accountability – designed to cre-
ate motivated and committed employees – and learning and development will
follow. Sadly, Argyris tells us this is fatally flawed. People learn through how
they think – through the cognitive rules or reasoning they use to design and
implement their action.

For Argyris, organizations can learn how to encourage learning, how to resolve
these learning dilemmas. At the root of his solution is to find ways of construc-
tively questioning the rationale or reasoning behind someone’s actions.
Let me give you an example from my own experience. Recently I was acting as
chairman of the audit committee of the board of directors of an organization in
which I am a non-executive director. The organization had, last year, subcon-
tracted its internal audit work to an outside firm. We were discussing the report
from the internal audit for the last year and considering the plan for the current
financial year. We had noticed that the budget for last year had included 25 days

48