In the fast-changing business environment, the contemporary organization’s must learn to be more adaptable and flexible for successfully facing the environmental challenges.

Most of the organizational changes are implemented in a planned manner for realizing the specific objectives or goals. However, organizational change can be implemented in any one of the following ways as described below:

Planned Internal Change

Planned internal change can be regarded as a strategic move by the organization implemented with the objective of changing the nature of the business itself or the way in which an organization is doing its business. This can be administered in one of the following ways: by changing the services or the products, bringing a change in the administrative systemic framework and also by changing the organizational structure or its size.

1. Changes in the Services or the Products: An organization usually goes ahead with the decision of a Planned Internal Change, if the management decides to diversify it’s range of business or a need is felt by the management for providing a new direction to the business or reviving the business by adding new service or product lines. Such a planned internal change will require a fair amount of pre-planning, effective coordination and resource distribution as well for meeting the objectives of change.

2. Changing the Administrative Systems: Changes in the administrative systems are implemented or enforced by an organization for enhancing administrative efficiencies, or for improving the company’s image or for gaining the advantage of being a political power within an organization. The pressure to change the administrative systems comes from the top level of the management (top-down approach).

   On the other hand, if there is a requirement for changing the very nature of work itself in an organization (changing the technical core), bottom-upward approach for the change is usually adopted.

   Previous studies have identified that organizations which are more mechanistic instead of being organic in its approach, in other words, which are more centralized and formal in nature, tend to achieve a greater degree of success in successfully implementing administrative change.

3. Changes in the organizational structure and size: Organizational restructuring or changes in the hierarchical framework is introduced in an organization for the realization of pre-defined objectives or goals.

Planned External Change

Organizations as a system is governed by both internal factors as well as external factors of change. Various factors like technological innovation and advancements in the communication and information processing field come under this category. These factors are external in nature but somehow are introduced in an organization in a planned manner with the objective of enhancing work efficiencies and improving the overall productivity.

1. Technological Innovation: Rapid technological changes have necessitated a change in the ways in which the contemporary organizations function.

   Technological development has altered the ways in which people handle their jobs. For example, in the automobile industry, a large part of the design and manufacturing process has been automated and equally depends on IT. Siemens (Germany) holds the credit for being the world’s first paperless office.

2. Advancements in Communication and Information Processing: In the present era, with the revolution in the communication technology and advancements in the information processing technologies like satellite communication technology, fibre optic cables, wireless technology and networking, etc, it has become much easier and convenient for the businesses to communicate with the business partners and also with the clients.

Unplanned Internal Change

Unplanned internal change can be regarded as a change which takes place within an organization not in a planned manner or as a strategic intervention, but are introduced in an unplanned manner in response to either a change in the demographic composition of an organization or due to performance gaps.

1. Change in the Demographic Composition: With increasing number of women workforce joining the organization and in addition to this older employees joining private sector jobs after completing their tenure in public sector or government sector and also increasing composition of diverse workforce in organziation’s as a result of globalization of worldwide economies, the demographic compositions of the workforce has undergone a sea change in the present scenario. The rapid change in the demographies will compel organizations to change.

2. Performance Gaps: Performance gaps associated with an organziation either in the form of depleting profit margins or non-performance of a product line or service in the market or slowdown in sales due to unexpected reasons, can compel an organization to change. Research studies have proven that performance gaps act as propellants for organizational innovations.

Unplanned External Changes

Two crucial factors like economic uncertainties and changes in the government regulations, play a crucial role in compelling organizations to change.

1. Governmental Regulation: Changes in the governmental regulations greatly influence the very nature of business of an organization and how the organizations operate in a highly competitive environment. Due to economic globalization and liberalization, government has enforced changes in the regulations in the form of de-licensing, currency conversion, etc, for supporting the domestic organizations to stay competitive and achieve the expected profit margins.

2. Global Economic Competition: Global economic conditions create competitive pressures on the organizations and force them to change for capturing a decent market share, achieve a winning edge in the international marketplace and expansion of customer base through aggressive advertisement and communication campaigns.

   In the era of globalization, the formidable challenge for the organizations for staying ahead in the competitive race is to remain innovative and to position itself as a unique brand.

To conclude, it can be interpreted that managing organizational change is one of the most essential pre-requisite for adapting with the competitive challenges and transitioning from the present state of business to a desired futuristic course of action. It is vital to develop and implement a plan of action for managing change successfully.