why an organisation might need to change

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So you are standing by the water cooler with the rest of the staff, chatting. Then someone points to a new notice on the staff cork board. All of you rush to the notice and groan in unison: yes, another change will be made in your department. You wonder whether your job is on the line, hoping against hope that it is not. Your organization is going through an organizational change. (www.bokca.com)

Many factors underpin the need for change in an organisation. Change can stem from growth, economic downturn, tougher or lenient trading conditions, technology and strategy changes. Competitive and customer force, government legislation and initiatives can all propel change.

As we enter the 21st Century, change and how to lead it successfully has become the foremost topic on the minds of organizational leaders. And for good reasons: Change is happening everywhere; its speed and complexity are increasing; and the future success of our organizations depends on how successful leaders are at leading that change. (Anderson Dean, 2006 p34)

All of us can be a little anxious about change, therefore, consciously or subconsciously we resist it as sometimes those fears are well founded and if established the change will really have a negative impact on us. Even though in many cases, however, those targeted for the change come to realise that the change was for the better. Change is constantly increasing especially with the arrival of the internet and the rapid use of new technologies has led to new ways of doing business. In this essay I am going to illustrate how internal and external pressures in the organisation I work for initiated change. I will be drawing on theories and practical experience to bring to fore the processes of change.

There have been a lot of radical changes in UK schools in the past decade. The government and other educational bodies have introduced various forms of innovations that have affected our nursery school and children's centre. The Single Funding Formula is one of the innovations that is impacting on my school and children's centre. In June 2007 the Government announced that local authorities will be required to create and implement a single formula funding for funding Free Entitlement to early years provision for 3 and 4 year olds across all sectors. This move was towards improving fairness and transparency in the way that funding is allocated to providers of early years education and in the process create support for the 15 hours extension to be delivered from September 2010. What the government means, is that funding levels and procedures do not have to synchronize for all early years (nursery) providers but they must be equitable and any variances should be reasonable and demonstrable. Basically the government wants private, voluntary and independent nurseries to be financed in the same way maintained nurseries are funded.

In 1999 the school funding system was introduced based upon the Local Management of Schools (LMS) and its financial delegation to schools. Formula funding and the delegation of financial responsibility to schools were its key aspects. The schools are located a lump sum budget then they decided on how to spend the money on pupils. In avertedly a mechanism is used to determine how much budget each school is allocated. The underlying principle for the changes being required to Formula Funding relate to the introduction of the Early Years Foundation Stage. Schools and early years providers have to follow a structure of learning, development and care for children from birth to five years old. This is called the Early Years Foundation Stage(EYFS).


This is a planned change initiated by the government and the Department for Children Schools and Families after recognising the need for change in their funding policy and procedures. An initiative driven from top to bottom and catapulted into action by external and internal power. Private, Voluntary and independent nursery providers have for a long time complained about not getting enough money from the government Nursery Education Grant to cover the cost some of their sessions.

Planned change involves a conscious decision by someone (Federal or national policy maker, local government policymaker, school principal) to change or transform some existing practice in a system or organization.( Ciaran Sugrue, 2008)

The government and the Department for Children Schools and Families (DCSF) have committed to this planned change and they have created a sound step by step approach in order to accomplish its aims. They have issued guidance and held consultations to implement the new scheme. The goals of the change and its development were clearly set in the guidance sent out to local authorities.

Providers and local authorities have been preparing for this for over two years, practice guidance was issued to all local authorities last year and updated in July this year.(http://news.bbc.co.uk)

Consultations are also being held to determine why the change is necessary. Single formula funding problems and opportunities have been evaluated. Unison in the letter to it members describe some of the impact this change will have on nurseries.

The way formula is developed could have a major impact on maintained nurseries, school based nurseries and children's centres. One of the principal differences in the new funding mechanism is that maintained nurseries will now be funded on the basis of places filled rather than on places offered as was previously the case. This means that nursery school funding will be reduced if they offer places in their nursery that are not filled. This change could mean financial difficulties for nurseries with unfilled places and should be monitored closely by branches. (McAnea C, 2009)

DSCF are the selected change agents responsible for the implementation of the planned change. They are working with the local authorities in consultation process.

Practice guidance, developed from the experience and learning of the nine authorities working with the DSCF since November 2007, is now available below to help all LAs begin to develop their own single formula. The six original pilot authorities are: Hertfordshire, Somerset, Leeds, Rochdale, Croydon and Southampton. Theses have since been joined by Derby, Greenwich, North Somerset, North Yorkshire and Shropshire.(www.dcsf.gov.uk)

In step with the change, DSCF have gathered data about the climate of the nurseries schools in order to help them prepare for the change. Nurseries and other educational institutions were asked to comment on the single formula funding.

A spokesperson for Newcastle City Council said, 'All local authorities have been directed by the DCSF to review the formula for funding the free entitlement to address inconsistencies and fund on the basis of participation. An open. transparent, clearly reasoned formula has been agreed by the Schools Forum, which has nursery headteacher representation on it. Nursery school headteachers, governors and staff have been fully engaged in the process, and are receiving targeted support to help manage the transition process.(Nursery World, 2009)

DSCF selected a few local authorities who piloted the scheme to begin with then will roll it out in April 2010. They have made themselves sensitive to the pressures for change by using networks of people and the pilot schemes. Key miles stones have been set up to determine the when, where and how of the scheme. The DSCF released the final guidance for implementing the single formula, have held consultation processes and recognised the cost in each provider sector and understood the behaviour cost. It has also delegated responsibility to the local authorities for each of the goals and objectives of the change in formula funding. After all queries have been answered, the plan will be put into operation nationwide in 2010.

This change can be described as transitional which is second order established to transform Formula Funding. It is one the complex types of change which occurs in an organisation. Transitional change looks to achieve a known desired condition that varies from an existing one. It is sporadic, planned, second order and radical. Over the years transitional change has become the basis of much of the organisational change literature. It also has its fundamentals in the work of Kurt Lewin who conceptualised change as a three-stage process.

Transitional change is more intrusive than developmental change as it replaces existing processes or procedures with something that is completely new to the company. The period when the old process is being dismantled and the new process is being implemented is called the transitional phase. A corporate reorganization, merger, acquisition, creating new products or services, and implementing new technology are examples of transitional change. 9


Social scientist Kurt Lewin's theory introduced a three step change model. He saw behaviour as an active balance of powers working in opposite directions. These driving powers bring about change because they lead employees in the desired direction. Controlling powers, however, hinder change because they push employees in the opposing direction. He argued therefore that these powers be examined. Lewin's three-step model can help move the balance towards the direction of planned change. The first step in the process of changing behaviour is to unfreeze the real situation.

To unfreeze is important as it helps overcome the tensions of individual resistance and group agreement. It can be achieved in three ways. One is to increase the driving power that controls behaviour away from the real situation. Two is to reduce the controlling powers that negatively affect the movement from the existing equilibrium. Three create some activities that can help in the unfreezing step like motivating participants by getting them ready for change. You could also build trust and identify problems and brainstorm solutions within a group. This is what happened with our change. DSCF and local authorities created a pilot scheme and also organised consultation projects and meetings which will build trust, identify and solve problems.

As a formal subject for study and application, change management can be said to have begun some 50 years ago with what has since become known as the planned model of change. The fact that this model lies at the heart of organization development and is associated with its major theorists, such as Blake and Mouton[8] and French and Bell[9], is a testimony to its importance. The origins and essence of planned change lie with the pioneering work of Kurt Lewin[4]. (Burnes Bernard, 1997)

The second step in the process is movement. Here, it is purported that it is necessary to move the target system to a new level of balance. One of the three actions to be taken to help the movement includes persuading employees to be in agreement that the status quo is not helpful to them and encouraging them to view the problem from a fresh perspective, working together on a hunt for new, important information and connect the vision of the group to well-respected, influential leaders that also support the change.. The third step in the three-step change model is refreezing. This step is to be taken when change has already taken place to make it effective over time. This is when new values are integrated into the community values and traditions. By balancing the driving and controlling power the new balance is stabilised. New patterns need to be reinforced and institutionalised through formal and informal mechanism including policies and procedures.

This change has obviously not received a warm welcomed from some of the early years providers. Many especially the maintained nurseries fear that funding by head count instead of places available will reduced their funding by relatively large proportions. There is talk about nurseries closing down because of cuts in funding therefore leading to job loses or cut.

Megan Pacey, chief executive of Early Education, which represents nursery schools in the maintained sector, said they were facing budget cuts of between a quarter and a third. She said: "At the very least it means there will be redundancies to staff and it is unlikely that nursery schools will be able to do the additional things like speech and language therapy and extended family services. (www.bbc.co.uk)

Others feel that any cuts will have a detrimental effect on the children's living and learning and are advocating for physical action.

Nurseries are being urged by Early Education to sign a petition against the implementation of the Early Years Single Funding Formula (EYSFF), which it claims will have a negative impact on the most disadvantaged children.(www.nurseryworld.co.uk)

"It's a second home for my family. When we're both working we have to know our children will be loved, cared for and educated to the highest standards," her father, Dean Halfpenny-Steel, says. "The whole centre is part of the family." But from September next year that could change as the nursery is facing losing a quarter of its budget in the funding dispute that is threatening every state-run nursery school in England (www.guardian.co.uk)

Headteachers of maintained nurseries are afraid that cash will be switched to private nurseries. This will have devastating effects on maintained nursery schools. Our nursery has already experienced the above and has made huge adjustments to our budget in time for new changes in funding policy and procedures. Casual staff have had their hours slashed and one person voluntary stood down. Two people who are on maternity leave have not had their post covered by other staff as new people have not been employed. We currently short staffed but everyone is willing to work towards saving money.

Not all employees will oppose change, and factions of support and resistance are not uncommon, for employees often will take sides. For example, those who favor a particular change and who feel most comfortable with it invariably will support the change, while employees adversely affected by the change usually will be less excited by it, are more likely to be anxious about it and usually will resist it (Carr, 1994; Geyer, 1995). It is no surprise, therefore, that employees who feel threatened by a change effort can resist with a resilience that matches or exceeds the will of the change leaders, especially when those employees possess power. (http://www.esc.edu)

Resistance was met by attending various meetings and letting our concerns be heard nation wide.

There have been concerns raised regarding the changes to the funding formula for early years.  Local Authorities are expected to have in place by April 2010 a single funding formula which allocates funding to all early years providers, maintained, private, voluntary and independent, based on the same principles.  This has caused difficulties in a significant number of LAs and has resulted in the Minister, Dawn Primarola, writing to LAs and sending additional guidance to them. (http://www.naht.org.uk)

The DCSF select committee has decided to launch an inquiry into the impact the single funding formula will have on maintained nursery school. The NAHT is telling their members to provide written submissions to the committee.

Following the Committee's oral evidence session on the Early Years Single Funding Formula on 28 October, the Children, Schools and Families Committee is now inviting written submissions on: The expected impact of new local funding formulae on providers of early years education and childcare services; Difficulties which have been encountered in drawing up new funding formulae, and how they are being overcome. (http://www.naht.org.uk)

Change is natural and sometimes good, but people's response to it is unpredictable and even irrational sometimes. It can however be managed well if done properly. Change is upsetting for people and has greater potential to cause failures, loss of production, or falling quality in work done. Also there is nothing as important to the survival of an organisation as change. There are so many historical examples of organisations that failed to change and are now out of business. I feel to successfully managed this funding change, things will have to be seen from the perspective the employees. There should be definition and understanding. Everyone is fearful of the unknown and most change always brings the unknown and or an expectation of loss causing people to resist it. The front-end of a person's resistance to change is how they see the change and the back-end is how well they are capable of dealing with the change they imagine. A person's degree of resistance to change is usually dominated by whether they see the change as good or bad, and how rigorous they anticipate the impact of the change will be on them. If they should accept the change it would have been based on the quality of their coping skills.

The political metaphor is more applicable to understanding resistance to change because it acknowledges the importance of organizational culture and politics (Gallagher, Rose, McClelland, Reynolds, & Tombs, 1997; Härtel & Berry, 1999; Meyerson & Martin, 1987; Pettigrew, 1973, 1985, 1987) and that resistance is often site specific (Knights & Vurdubakis, 1994). It more readily acknowledges that employees will naturally be suspicious about change (Toffler, 1970), and that resistance is often a result of the employees' subjective conceptions of what is desirable (Collinson, 1994; Jermier, Knights, & Nord, 1994). (Phil Hay et al, 2000)

My job, if I was a leader would be to address their resistance from both ends to help the headteachers reduce it to a minimal, manageable level. I would not bulldoze through their resistance so that I can move ahead which sometimes feels like they are doing. If I was DSCF I would persuade Headteachers of the benefits the proposed changes will bring. I would also make sure that headteachers have the opportunity to influence the changes by forming a working group, for instance. Its members would be the respected amongst the schools and would also be people who have a real positive attitude towards the change. They would be working group that is open to new ideas and capable of generating creative solutions. Finally they would be aware of the practical implications of any solution to single formula funding.