Roll with the Changes

On Saturday, the New York Times featured a story about change management: "How Industries Survive Change. If They Do." Companies face change throughout their organizational life cycles. Whether it is a direct product of internal reform or an indirect byproduct of external factors, change happens. The recession has made that painfully clear. Often less obvious, however, is how an organization is positioned to face change and subsequently manage it.

Resistance

• Companies that are positioned to resist change - as determined by SWOT analysis, examination of key assumptions and variables, etc. - must adopt either transformational or entrenchment strategies. Transformational strategies promote high levels of both innovation and cultural change. Conversely, entrenchment strategies promote moderate levels of innovation and low levels of cultural change. In the long-run, transformation trends towards organizational survival while entrenchment trends towards organizational decline.  
  

Acceptance

• Companies that are positioned to accept change - as determined by SWOT analysis, examination of key assumptions and variables, etc. - must adopt either adaptation or toleration strategies. Adaptation strategies promote moderate levels of both innovation and cultural change. Conversely, toleration strategies promote low levels of both innovation and cultural change. In the long-run, adaptation trends towards organizational survival while toleration trends towards organizational decline.

The U.S. auto industry would make an excellent case study for this change matrix, especially given the current financial bailout under Congressional consideration. The Detroit "Big 3" could wind up in any of the following four quadrants:

1. Resistance: Transformation (High Innovation; High Cultural Change) = Survival
   
2. Resistance: Entrenchment (Moderate Innovation; Low Cultural Change) = Decline
   
3. Acceptance: Adaptation (Moderate Innovation; Moderate Cultural Change) = Survival
   
4. Acceptance: Toleration (Low Innovation; Low Cultural Change) = Decline
   

U.S. automakers must asses how they are positioned to face change and subsequently manage it, or they could very well have that responsibility appropriated by the federal government. As REO Speedwagon once said, you have to know how to roll with the changes.