Breaking the Code of Change. . - book review

Administrative Science Quarterly,  Dec, 2001  by Raymond F. Zammuto

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Michael Beer and Nitin Nohria, eds. Boston: Harvard Business School Press, 2000, 507 pp. $45.00.

Breaking the Code of Change is the published outcome of a research conference by the same name held at Harvard Business School during 1998. The volume's editors, Michael Beer and Nitin Nohria, note in the preface that the participants consisted of a relatively small group of leading academics, consultants, and senior managers brought together to address the issue of why corporate change efforts are so often unsuccessful.

If there was a "code" that could unlock our understanding of how change might best be managed, it had not yet been broken. . . . We felt these outstanding minds might enable us to take an important first step in developing an integrative conceptual framework that would inform the question being asked by managers around the world: How do I go about managing change effectively? (pp. x-xi)

The conference had an unusual design that is reflected in the book's structure. The first day of the conference was organized around three case studies of major corporate changes--Scott Paper, Champion International, and ASDA (a large British grocery chain subsequently acquired by Wal-Mart)--that are referred to throughout the book's chapters. The remaining two days of the conference were organized around a set of debates about best practice that form the core of the book.

The first chapter, by Beer and Nohria, "Resolving the Tension between Theories E and O of Change," sets the stage for the debates by outlining two opposing views on organizational change. Theories E and O parallel Douglas McGregor's classic distinction between theories X and Y. Theory E change focuses on the creation of economic value through formal strategies, structures, and systems. Theory 0 change, in contrast, is a high-commitment model that focuses on developing an organization's human capability to implement strategy and learn. Beer and Nohria note that the approaches to change embedded in both theories are valid but that "too often these theories are mixed without the resolution of the inherent tension between them. This leads, we argue, to the maximization of costs and the minimization of the potential benefits of each theory" (p. 4). They indicate that the inherent tension between the approaches might be resolved by sequencing them, as is often done in turnaround efforts when one management team is brought in to make cuts and strategically reposition an organization (Theory E) and then another management team follows to heal the organizational and human damage (Theory 0). Alternatively, they suggest that it is possible to integrate the two approaches, which is a more difficult course, usually with different management team members representing the different change models. The danger, as the authors note, is that neither type of change initiative is implemented well and that "half measures are equally ineffective; they are likely to obtain the worst outcomes of both strategies and none of the benefits of either" (p. 30).

These tensions are explored throughout the remaining chapters of the book in a series of seven debates among leading scholars, managers, and consultants. Each of the seven debates contains a chapter arguing from a Theory E perspective and another from a Theory O perspective. The debates are organized around seven themes: Michael Jensen and Peter Senge square off over the purpose of change and whether managers should be concerned primarily with increasing shareholder value or an organization's capacity to learn. Warren Bennis and Jay Conger debate the roles of top-down versus participative leadership in change efforts. Jay Galbraith and Larry Hirschhorn focus on whether change efforts are best led by structural or cultural change initiatives. Sumantra Ghoshal and Christopher Bartlett face off with Karl Weick to explore whether planned or emergent change efforts are more effective. Karen Wruck and Gerald Ledford present arguments about whether changes in compensation systems should lead or lag a change effort. Terry Neill and Craig Mindrum debate Robert Schaffer over the role of consultants in change efforts. Should they serve as expert advisors in designing and implementing large-scale change programs or guide an organization's members through the process of initiating smaller projects aimed at achieving measurable results? Finally, Andrew Van de Ven and Chris Argyris debate the issue of how change research should be conducted, as a scientific endeavor that creates generalizable knowledge or as action research focusing on actionable results.

As you might suspect, given the caliber of the authors, the quality of the individual chapters is quite high, each author arguing cogently a position for which he or she is well known. The one exception is Warren Bennis, a noted author on leadership, who was cast in the role of arguing against the proposition that successful change must be led from the top. Bennis apparently didn't find the role too arduous. He opens his chapter by noting that "getting impaled on the horns of a false dichotomy was rather more fun than I had anticipated" (p. 113). Overall, each chapter provides a clear and persuasively argued statement on organizational change.