Organizational Change Effectiveness in an Indian Public Sector Organization: Perceptions of Employees at Different Levels

By Nandan, Shefali; Verma, Anuja | South Asian Journal of Management, January-March 2013 | Go to article overview

Organizational Change Effectiveness in an Indian Public Sector Organization: Perceptions of Employees at Different Levels


Nandan, Shefali, Verma, Anuja, South Asian Journal of Management


Turnaround process in an organization results in changes in almost every aspect of working. Empirical approach based quantitative analysis of a case study undertaken at Bharat Pumps and Compressors Limited (BPCL), a public sector organization in India, that underwent turnaround successfully, is presented here. Change outcomes in the organization directly affecting the employees were identified in the study and employee perception on effectiveness of these changes was also studied. These change outcomes were identified as: enhancement of employee involvement, improvement of various organizational processes and systems, improvement of work environment and improvement in performance management process of employees. The study indicates that though change effectiveness is perceived as positive by different levels of employee, there were significant differences between higher and lower levels of employees. Based on the findings, the paper identifies lessons for policy makers and change agents in transforming companies in the context of emerging markets such as India. The paper offers an in-depth analysis of successful transformational change practices from employees' perspective in a large public sector organization in India.

INTRODUCTION

In organization, most problems and challenges are generated by factors like product quality maintenance, enhancing employee efficiency, innovations, and new leadership and management approaches, amongst others (Madsen et al., 2005). These problems, when allowed to accumulate over a period of time may ultimately take its toll on the health of organization and result in sickness of unit. The Government of India enacted the Sick Industrial Companies (Special Provisions) Act, 1985. As per the revised definition provided by this Act, a sick industrial company would be one which is registered for a period not less than five years and whose accumulated losses are equal to the sum of paid up capital and free reserves.

Turnaround strategy is often followed to revive such sick units. Turnaround may be defined as a sharp, positive reversal in the performance of a company or the overall market (http://www.investorwords.com/2962/market.html). Schendel et cd. (1976) and Robbins and Pearce(1992) found out that turnaround concept is operationalised in the literature as performance decline followed by performance improvement. Improving organizational performance means improving the organizational strategies and changing the work systems. Thus, turning around an organization involves changes of large magnitude. According to Cummings and Worley (1993) change can be described as the deliberate introduction of novel ways of thinking, acting and operating within an organization as a way of surviving or accomplishing certain organizational goals. Turnaround strategy was adopted at Bharat Pumps and Compressors Limited (BPCL), a public sector unit in India, to revive it.

FOCAL AREAS OF CHANGE

According to Armenakis and Bedein (1999), organizational change may refer to four dimensions: content, contextual, process and outcome issues. This paper focuses on outcome issues. The main objective of change process during turnaround is to enhance overall productivity and performance of organization, which in turn is dependent upon employees' performance and productivity. The factors which influence the productivity of employees and organization, identified as the universal factors by many researchers, e.g., Armstrong (2003), Bernadin (2003), French and Wendell (2003), are broadly divisible into four categories: (1) factors related to job itself, which are job analysis, job description and job specification; job rotation; and avoidance of overloading of individuals with work. (2) Factors connected with financial aspects - such as ensuring equitable, adequate and timely remuneration; bonuses or similar awards; (3) those related to human relations, which include encouraging participative management; providing employees with an environment (both physical and psychological) that is conducive to work and having counseling services. …

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