Why do Organizations Change?

Organization and Change

Student (MBA)

Why do Organizations Change?

We all know that organizations change. They have to. But exactly why do organizations change? In other words, what are the causes or reasons for change to occur in organizations?
How can these reasons be categorized in a logical way? Is there some kind of model of causes for organizational change?

  Jaap de Jonge
Editor, Netherlands

Why do Organizations Change? Causes

Thanks for your excellent question... A first breakdown of such reasons or causes for companies or public organizations to change could be:

A. Factors in the external environment
Factors outside the firm, generally beyond its control
B. Internal factors in the organization
Factors inside the firm, generally under its control
A1. Political B1. Leadership
A2. Economic B2. Vision
A3. Social B3. Mission (statement), purpose
A4. Technological B4. Strategy
A5. Competition B5. Culture, values
A6. Customer demands B6. Policies, procedures, systems
A7. Environment, climate, pollution B7. Merger

A useful model for external factors: PEST Analysis.
A useful model of internal factors: McKinsey's 7S Framework.

Any of the 14 main causes could be further split up into a large number of sub-factors. For example A2. Economic could be further split up into: economic growth, recession, interst rates, government spending, unemployment rates, taxation, infaltion, consumer confidence, globalization, etc.

Note that some of these main causes can be viewed as external or internal. And also that certain sub-factors can be viewed as being part of multiple main causes. As usual, the reality is always more complex than the management model. But how could we manage :-) without them?

  Emilio Ferrero
Management Consultant, Curacao

Triggers for Organizational Change

Mr. de Jonge's list is quite thorough and is usual...

  Dilip Khanal
CEO, Nepal

Change Factors in Small Organizations

Further to Mr de Jonge's list, I would like to add...

  Robert Gerth
Project Manager, Sweden

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Editor, Netherlands

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What are the Causes of Organizational Change?

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Editor, Netherlands

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Organization and Change

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