The speed of change in Enterprises

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Change, change,is speed contained by the skill and diligence has increased immensely over time and new products are introduced regularly. This demands an increased capability to manage changes within a company. The world has changed and will continue to change. Senior and leming (2006) provide a picture of the future and how it will affect people and their willingness to change. They predict there will be a structural change with less layers of management and a reduction of the numbers of people working together. There will be a stronger pressure for individuals to work harder and longer. The working pattern is also assumed to change.

It will be normal to have more than one place of employment and a greater number of people will work from home. The workforce characteristics will also change with the rate of birth decreasing and the number of old people increasing, leading to a rise in the average age of people working. The workforce skills will also change with a higher requirement for workers to learn new skills during their career due to changing technologies and a more competitive environment. The workers will also have more employment choices, with an increasing rate of self-employment and working abilities in small organizations

Saab Aerosystems is one business department within the Saab-group. The company offers

advanced aircraft systems, related parts of systems and services during the whole lifecycle of the

product, to defense customers and aircraft industries around the world. They have four focus

areas, fighter aircraft, aircraft systems, support solutions and unmanned aerial vehicles. The main

product, for the company and the fighter aircraft area, is the Gripen system. Saab Aerosystems

has the overall responsibility for development of the Gripen system and the system incorporates

the world's most developed data link. Aircraft Systems have both commercial aircraft systems

and different kinds of trainings and simulations. Saab Aerosystems has developed advanced

aircraft systems for more than sixty years and examples of products are flight control systems,

airborne computer systems and cockpit systems. This area also offers training equipment such as

advanced simulator systems, pilot training and complete training systems for fighter pilots.

Support solutions offer support for products, maintenance and solutions for everything on the

aftermarket. The unmanned aerial vehicle is a new segment and Saab has developed and is

involved in some development projects for a couple of different unmanned aerial vehicles such as Skeldar, Filur and Neuron. Saab Aerosystems is a business department of Saab AB, but is run as a free-standing company with one owner, Saab AB and the company had 1664 employees as of he 30th Nov

It is the business department manager, Lennart Sindahl, who is responsible for the overall

management and the results of the business department. Saab Aerosystems have staff

2.4 Current Changes

Many theorists, e.g. Härenstam et al. (2004), Schein (1992) and Wendell and Bell Jr. (1999),

claim that the need for change and an organization that can handle change will be necessary in

the future. As stated before in this thesis, the companies environment constantly change and

demands new solutions from employees within the companies. This also applies to the situation

at Saab Aerosystems. Three different projects that will lead to some kind of change for the

company have been studied. The results from these studies are presented in chapter 5, Empirical

Findings. Below, the three projects are described.


Saab AB is made up of 17 business departments where Saab Aerosystems is one. Up until now,

these different companies have managed projects and business according to their own methods

and models and within some departments there have been many different models. These

differences have made it difficult for decision making resulting in management having to

dedicate much time in order to completely understand the business status. The Business Control

And Monitoring process, hereinafter referred to as BCAM, aims at improving the management of

business and projects within Saab and introduces a common language, terminology and number

of reports across the entire Saab Group. It will increase the visibility of business and project

performance to management on all levels as well as increasing efficiency in cross business

department prospects and projects due to common language and methods. The latter mentioned

oth internal and

external. The projects are seldom repeatable and the teams are often delivering a wide range of

products and services.


Gunder is a project that exists only within Saab Aerosystems and will be carried out between the

years 2006-2009. It aims at helping the company adapt its operations to new conditions and

increase flexibility within the department.

This ability to adapt to new conditions will contribute to that Saab and Saab Aerosystems 2016


• become the leading European air vehicle industries, one of two in the world

• continue the development of Gripen in new versions and continue to have a successful

export market

• offer a number of UAV-products that can operate in civil air territory

• be one of Sweden's most attractive and exciting places of work where people can work


• establish the company as a producer of systems to the commercial air vehicle market

• undertake development and production of all air vehicles within the Swedish air force

Gunder, also aimed at providing persistent profitability, consists of eight different sub programs

the company will save money. Gunder will not only save money and increase cooperation, it will

also work for changing the company culture in order to improve in areas of international


Gunder's eight different sub programs are presented below:

• "Vår värdegrund" - implement common values within the organization

• "Aktival" - increase flexibility within production in order to keep profitability even when

the flow in the production is low

• "PDM" - increase the efficiency of configuration support and compilation of system


• "" - secure the subcontractors capacity in the

future and develop effective logistics solutions within the Saab Group

• "" - render the project work more effective in order to ensure good


• " - review and adjust the total cost

• "MBSE" - effective products development and higher competitiveness through system

development based on models

• "" - adjust business- and contract models to new business



Neuron is a project aimed at developing a stealthy UCAV, Unmanned Combat Aerial Vehicle.

An outline of Neuron can be seen in

Figure 3. The project includes industries from six different countries in Europe, where Saab

Aerosystems from Sweden is one partner. Dassault Aviation from France is the prime industry in

this project and will coordinate the project and all partners. Dassault Aviation has also signed the

main contract and Saab Aerosystems has a subcontract with Dassault Aviation. The value of Saab

Aerosystems part is approximately 25 percent of the main contract. Saab Aerosystems predicts

that this kind of multinational project will be an important part of their future business as it is not

likely they will solely develop a new air vehicle again. Saab Aerosystems deems it important to

learn how to collaborate with international participants and believe they must adapt their way of

working to the international environment.

Neuron will also strengthen Saab Aerosystems position in Europe within the company's areas of

competence, which are avionic1, autonomy2, construction of bodies, system integration and


mentioned areas and transfer knowledge from the generation that developed Jas 39 Gripen to a

new generation who will develop the next UCAV approximately 2010-2015.

This change for Saab Aerosystems consists mainly of the new situation where they have to

collaborate with representatives from many different companies from Europe. This will be a

completely new and difficult challenge, as the companies have different sorts of technical

solutions, different company and national cultures, different ways of doing business etc. It will

. When Saab Aerosystems has carried out business with FMV, they have had

shared responsibility for both profits and losses. With Neuron, Saab Aerosystems has a fixed

budget and the company has no reserves to cover an unexpected cost increase. This new situation

will force the company's employees to be more cost conscious; as the risk factor for the project

generating a loss for Saab Aerosystems is greater. Neuron started in 2006 and the first phase

resulting in a prototype, will be finished in 2012.


Organization Structure

There are a couple of different ways of how an organization can be structured. One of the bestknown

forms is the bureaucratic form. It was the German sociologist, Max Weber, who defined

the form and asserted that this was the only effective way of how an organization could be

structured. The characteristics for a bureaucratic organization are that different roles are well

defined and specialized. These roles are strict, hierarchically arranged and there is a single chain

of command from the top of the organization to the bottom. It also has impersonal rules and

relationships. This organization structure relies greatly on the use of rules, procedures and written

records. The intention of the bureaucratic form was to imply fairness and neutrality in the way the

people in the organization were treated, but nowadays the term bureaucratic has a quite negative

undertone with a feeling of hard, undesirable rules and a lot of control mechanism. (Senior &

Fleming, 2006)

The bureaucratic organization can be tall or flat3. A flat organization needs fewer managers

compared to that of a tall organization. One rule is that the more similar the jobs are, the more

people a manager can coordinate and control. It takes a lot of time and attention in managing

many people carrying out very different kinds of jobs. Another rule is that the more decentralized

3 A flat organization has fewer organizational levels comparing with a tall organization. When a company is

flattening its organizational structure, it gets less organizational levels. (Senior & Fleming, 2006)


the decision making is, the broader the span of control. If it is the manager who has to take all

decisions, it is natural that the manager cannot manage a lot of people. (Senior & Fleming, 2006)

Regarding the number of levels in the organization, these should be as few as possible. If there

are a lot of levels, it is harder to understand the objectives and to communicate, both up and down

in the organization. In a horizontal dimension, the bureaucratic organization can be organized by

function, product or service or by location.

Nowadays, many bureaucratic organizations complement their organization with teams, network,

or project organizations in order to obtain a higher flexibility. When complex tasks arise, the

organization is prepared and can easily put together a group with specialists from many different

areas, who are then used to collaborate with other specialists.

Another type of organization structure is the matrix structure. This form has normally a

functionally designed vertical axis, but with a horizontal axis designed in some other way, for

example products or regions. This means that there are two chains of command, one vertical and

one horizontal, which operate at the same time. (Senior & Fleming, 2006) The matrix

organization often is developed by a crisis when the organization becomes too big and complex

and it starts to be impossible to manage through normal bureaucratic systems. To succeed with a

matrix organization, it is important to have good teamwork with managers who possess both high

level behavior and management skills. The focus should be to solve problems through team


4.1.2 The Organization Structure Depends on the Environment

A study regarding how the environment affects organizational structure shows that the

organization has different structure depending on whether they operated in a stable environment

or a more dynamic, changeable environment. The study identified two different main types of

structure, mechanistic structure which is suitable for stable environments and organic structure

which suits a more unpredictable environment. (Burns & Stalker, 1994) Utterback (2004) agrees

with Burns and Stalker's theory regarding the environments influence on the organizational

structure. Mechanistic organization is characterized by a well-known business environment and

routine operations. Mechanistic organizations often have specified and standardized products and

organizational control is provided through structure, goals and rules. A mechanistic organization

is quite rigid bureaucratically. Organic organizations live in high uncertainty of both market and

technology and they have often limited hierarchy. They also include many people with

entrepreneurial roles, and often work with product innovation. Organic organizations often have

structures similar to matrix organizations or even loosely coupled organic network. (Utterback,


4.1.3 Characteristics of a Swedish Organization

Tichy and Sandström (1974) wrote in an article about the characteristics in a Swedish

organization and what is important to think about before carrying out any changes. They

primarily looked at organizational innovations which purposes were to change the working

environment and improve worker satisfaction. They claim that the most common innovation was

to increase worker involvement in decision making concerning factors affecting their jobs. They

identified a number of factors which are important when carrying out these kinds of changes in a

Swedish organization. These are:


• An organization exists when people act together in a structured way to achieve a goal.

• An informal organization can exist beside the formal organization. The informal

organization does not always has the same purpose and goal as the formal organization.

• The bureaucratic structure shows how the organization is hierarchically arranged. The

bureaucratic organization can complement its organization with teams, network or

project organization in order to be more flexible.

• The environment affects the organization. A mechanistic, bureaucratic organization suits

a stable environment and an organic, less hierarchical organization suits with a dynamic,

changeable environment.

• Organizations within Sweden have some special characteristics which are important to

think about before carrying out changes. Swedish workers think it is important to be able

to influence and participate. They are often highly educated and have a strong

commitment to democratic values.

• Sweden's strong commitment to democratic values

• Sweden's affluence

• Sweden's high level of education

• The willingness of Swedish labor to get involved in these types of innovations

• Values which support research and development on new social and organizational forms

4.2 Organizational Culture

Organizational culture as a concept has only been used for a short time period and it came first

into the forefront when trying to explain why companies from USA did not perform as well as

some similar companies in other countries, notably Japan. When trying to explain the differences

it was obvious that national culture was insufficient. Researches have shown that organizations

within the same society differ, especially in effectiveness and the purpose of organizational

culture seems to be one explanation. Different researchers have different

approaches as to what they mean with organizational culture. For example, Martin

and Siehl (1983) mean that the culture can be analyzed and measured and are then looking at

aspects such as organizational stories, rituals and rites, symbolic manifestations and other cultural

elements. They also mean that these aspects describe the holistic4 aspect of group and

organizational phenomena. Another model identifies how members of the

organization react. Some companies are much more formal and bureaucratic than others, but this

does not tell how it affects the members and why these differences exist. For example, researches

show that studying organizational symbols, stories and myths can give wrong inferences while

the underlying assumptions are not known. Organizational stories are especially problematic,

while the lesson behind the story will not be clear for persons who do not know and understand

the underlying assumption behind the story.

There are three different levels of culture; observable artifacts, values and basic underlying

assumptions. Artifacts can be observed by anyone who enters the organization and it includes

everything from the physical layout, the dress code, the manner in which people address each

other, products, statements of philosophy etc. In order to identify values, interviews,

questionnaires or survey instruments can be used. Values include norms, ideologies, charters and


4.2.1 How Cultures Develop and the Impact of the Leader

Culture is learned within the organization, but the process of learning something that becomes

shared within a group is still only partially understood Norms and beliefs arise

according to how members respond to critical incidents. When there are many emotions involved

in an episode, it will affect the group. For example, they mean that a members attack on the

leader can be such an emotional happening, especially if everyone witnesses it and if the tension

is high when the attack occurs. The behavior that follows after a happening like this tends to

create a norm. For example, if the leader counter-attacks, the group members concur with silence

or approval and the attacking member apologizes and admits his or her mistake and a new norm

that says "we do not attack our leader" is created. This norm will after a while become a belief

and then a statement, if the same pattern should arise.

. Primary embedding

mechanisms have the most impact and are the following:

• What leaders pay attention to, measure and control

• How leaders react to critical incidents and organizational crises

• Deliberate role modeling and coaching

• Operational criteria for the allocation of rewards and status

• Operational criteria for recruitment, selection, promotion, retirement and


There exists also another sort of more indirect way of influencing the organization, called the

Secondary articulation and reinforcement mechanism which consist of the following:

• The organization's design and structure

• Organizational systems and procedures

• The design of physical space, facades and buildings

• Stories, legends, myths and symbols

• Formal statements of organizational philosophy, creeds and charters

(Schein, 1992)

When the organization evolves and grows, by expanding with more departments, there are two

processes that will exist at the same time. A process of differentiation where the organization

develops various kinds of subcultures that will create diversity and on the other hand, a process

of integration, where various deeper elements of the culture become congruent with each other

caused by the human need for consistency. (Schein, 1992)

4.2.2 The Relationship between Organizational Culture and Individual

The culture has a large influence in many situations, for example when new members should

enter the organization. The process begins with recruitment and it is common that the selection is

based on if the person has the "right" set of assumptions, beliefs and values, according to the

organization. When a person is found, that matches the profile, the person is trained and

acculturated, a kind of socialization process. (Feldman, 1988) The socialization process can vary

due to the specific company and its philosophy. The result from the socialization process is notss

uniform, individuals respond differently to the same treatment and different tactics of

socialization can produce different outcomes for the organization. (Van Maanen & Schein,1979

in Schein 1992)


Three different kinds of outcome are possible:

• Custodial orientation, the person accepts completely all norms and assumptions

• Creative individualism, where the person learns all central assumptions and norms of the

culture with importance, but also rejects peripheral ones. These kinds of selections permit

the individual to be creative while still maintaining respect for the organization and


• Rebellion, where the person totally rejects all assumptions


4.2.3 How to Identify an Organizational Culture

Many studies point out the difficulties in studying organizational culture, while each research

develops new definitions, key concepts and approaches to studying the phenomenon. One

possible explanation is that culture lies in the middle between several social sciences and tries to

reflect a little bit of each. There are weaknesses in methods of studying organizational culture,

while there must be a more clinical and ethnographic5 approach. This is necessary if the goal

should be to clearly identify the kinds of dimensions and variables that in the end will lead to

more precise empirical measurements and hypothesis testing. The linkage between theory and

observed data is still not good enough and researchers are still looking for hypotheses instead of

testing specific theoretical formulations. (Schein, 1992)

Even though there are many contrary opinions, Douglas (1973) presented a model that has been

widely accepted according to Hendry (1999). The model includes two different categories, grid

and group. Grid describes the scope and coherence of a dominant system of classification that

structures the individual's world view. The more the individual thinks in line with the structured

system, the higher that individual is located on the grid dimension. A low rate, below zero of grid

dimension means that the individual has an increasingly strong and coherent private system of

classification. Zero represents confusion and lack of any system. Group describes the control the

organization has of the individual ego. At the right, high rate of group, the ego is totally

Changing within Organizations

A similarity between the different sorts of changes with the strength of the wind can be drawn. A

small change can be as a soft summer breeze that only disturbs a few papers while a big change is

like a mighty howling gale which may cause devastation to structures causing a need for

rebuilding. The organizational life is much more uncertain today compared with the situation a

couple of years ago. The differences are that the pace of change is quicker and the future

becomes more unpredictable. Furthermore, this development is predicted to continue and the

organizational world will change at a fast rate. To have the ability to follow this fast rate of

change, it is important that the organizational managers and decision makers understand and are

aware of the factors that trigger the organizational change.

What is really meant by the notion "organizational change"? Huber (1991) writes that

organizational change means a new position or another position compared to how the

organization functioned and how it members and leaders acted earlier. Change is a type of

organizational development while the members of the organization change by the input of new

strategies, which in turn leads to behavioral change. The change will develop the organization to

better fit predicted future environments.

Porras and Silvers (1991) theory indicates that the organization has complete control over its

development. Organizations are open systems meaning that they are characterized by

continuously ongoing processes of input, transformation and output interacting with a

surrounding environment. It is impossible to achieve complete control over an open system,

while it is affected by external forces consisting of surrounding systems, like customer, supplier,

society etc.

Change is constant modification that comes about of unexpected events in everyday work. This

theory assumes that it is impossible to have complete control over the organization's

development and that the result of a change will normally not be exactly as the predicted result.

change can be read: "the only thing that can be predicted about a change is that no change

follows its original plan". One main factor in implementing a successful organizational change is

that much attention is focused on communication. It is a tool for conveying information and

creating understanding for the change within the organization.

4.3.1 Different Types of Change

Change events come in various forms. First of all, a change can be intrusive or non-intrusive,

they can be seen as threats or not. Some changes only affect the environment and not the group

while other changes can have a direct influence on the group itself, for example a new group

manager. There can be big changes that alter everything or small changes that only concern a few

people. Change event can also vary in predictability and controllability. It is only possible for the

group to choose the time for a change, when the change is both predictable and controllable. The

advantages of these kinds of changes are that they can be done when the group is ready and has

time. Changes that are unpredictable or uncontrollable possess potentially bigger challenges and

difficulties for the organization.

Planned vs. Unplanned Change

Planned changes normally are implemented by actors with knowledge about the change and

where the change has been thought through before it is implemented. Planned change also always

tries to improve the situation and the desired goal is often described before the change starts. On

the other hand, unplanned change is not always driven by the will of humans and it does not

always move the organization in a desirable direction. Other major contrasts between planned

and unplanned change are the degree the change can be choreographed, scripted or controlled.

Theories of planned change focus on how processes can be managed or controlled, while theories

of unplanned change mean that change is a force that not always can be managed or controlled.

for future change, they are only interesting in changes that can be controlled, which means

planned changes. Further, only literature dealing with planned change is studied.

Episodic vs. Continuous Change

Changes can be categorized according to which tempo they have, episodic or continuous change.

Episodic change is infrequent, discontinuous and intentional while continuous change is ongoing,

evolving and cumulative. Episodic change occurs when the organization is moving from its

equilibrium condition. It uses a distinct period of time to be completed and normally involves

some sort of shift, like technology change or change in key personnel. Continuous change is an

expression that groups together ongoing, evolving and cumulative organizational changes.

Normally, the change is described as situated and grounded in continuing updates of work

processes. The idea of continuous change is that small continuous adjustments, which are

implemented simultaneously across departments, can cumulate and create substantial change.

Episodic and continuous changes are treated differently. Episodic changes are often implemented

during a short time period. They are often well planned, in detail from an initial to a final phase.

4.3.2 Influences for Change

Factors which influence the organization can be sorted into four different groups, and they refer

to the political, economic, technological and socio-cultural factors. These factors can influence

the organizations strategies, structures and means of operation. Triggers for change can come

from all these sorts of groups. For example access to the bank via the Internet is a result of a

technical trigger, identified as the enormous increase in the ability to communicate through the

Internet Other examples of triggers are when a new competitor

appears and takes a big share of the company's market, when an old customer is acquired by a

giant conglomerate that changes the sales condition or when a new invention offers a possibility

of changing the existing production technology.

• Physical power: the power of superior force

• Resource power: the possession of valued resources; the control of rewards

• Position power: legitimate power, comes as a result of the role or position held in the


• Expert power: vested in someone because of his/her acknowledged expertise

• Personal power: charisma, popularity; resides in the person and in his/her personality

• Negative power: illegitimate power; the ability to disrupt or stop things happening

(Senior and Fleming, 2006)

How Time and Timing Influence Change

They mean that the timing of events has shown to be important to enforce

routines, focus energies and attention, shape how people approach their tasks and give meaning

to actions and events.



Temporal Shift

Involves changes in

How Culture Influences Change

According to Hatch, organization culture is a stable, conservative and resistant force that

is against change and normally only changes through management intervention. Another

researcher and author, Hendry , claims that "Because of its deeply embedded

nature any culture, society, institution, or organization is resistant to change". Hatch

asserts that resistance to change is rooted in cultural stability. Schein argues with them

when he maintains that cultures normally stay stable until leaders act to change them. To change

a culture, it is important to change its value set and for leaders it is central that they demonstrate

and provide public displays of new values.

Change Strategies

There are a couple of strategies that have been developed after studying Swedish companies.

Gustavsen et al. (1996) presented the following five change strategies: expert driven strategy,

concept driven strategy, technology driven strategy, design driven strategy and communication

driven strategy.

In a concept driven change process, communication is of central importance for how change

processes are run. It is often the used strategy when concerning extensive organizational change

or parallel and simultaneous changes or all main functions in an organization. Expert driven

change process, are driven and initiated by experts in a particular area. Both expert and concept

driven strategy are built on analytical knowledge with focus on participation, knowledge base and

goals. Technology driven strategy is formed from earlier experiences when new technologies

were introduced, while new technology often demands an organizational development. Design

driven strategy is a development of the technology driven strategy, when the organization has

experience from a number of introductions of new technologies. Finally, communication driven

strategy is based on the communication between management and employees and this

communication is seen as an important part of the change process. This strategy needs


participation on the part of the employees throughout the change process. Concept and

communication driven strategies both use the communication between management and

employees as the driving force for the development, but the difference between them is that the

concept driven strategy has a stronger structure for how the change will be implemented.