What is Diagnostic Model of Organizational Change?

The success of today’s small and medium-sized companies in large part is based on their ability to implement organizational change and change their principles of work as quickly as possible when their environment starts to make pressure for changes. So, here I would like to talk about the diagnostic model of organizational change.

One way that managers can use to survive is to implement the systematic approach in following and analyzing different sources of organizational change. This is the basis of this diagnostic model of organizational change.

We are living in a world where change is normal and something that occurs every day in organizations of any kinds. Our today’s expectations were higher than those from yesterday. Our expectations for tomorrow are also higher than today.

Customer’s expectations are changing with much higher speed than in the past. Suppliers change their way of doing business. Partners are different over time. The interest of various stakeholders as a part of the closed environment of organizations vary over time.

Outside changes will appear regardless companies want them or not. Then, how safe is small and medium-sized businesses from the external forces that can cause changes in their organizations?

Production managers will always need a red light as a sign that exists in the manufacturing plants and will tell them when something can be wrong to stop the production process, eliminates errors or problems and activates the process again to continue without errors.

It’s the same with the organizational systems. Managers need to immediately be aware of different signs from their organization’s internal and external environment that will tell them they need to make something.

Discovering different sources of organizational change as quickly as possible becomes one of the key competitive advantages of today’s small and medium-sized companies.

Uncertainty and Diagnostic Model of Organizational Change

I have already written about an entrepreneurial journey and uncertainty in the post titled as “Your entrepreneurial journey is not the journey from A to B.” But, it is important here to recall some of the thoughts presented in that post.

Usually, entrepreneurs start with their vision about the future and where they want their businesses to be in that future. Simply, they know where they are now and know where they want to be in the future.

We can present this as on the figure below. For example, the company’s current position is A, and the company wants in the future to be in the position B.

But, as we already know, entrepreneurial journey is not so simple. The first thing that they will need is a business plan that will be used to predict their journey in the most detailed pieces.

The reality is not so straightforward for entrepreneurs, because their businesses operate in a highly uncertain environment that will not give them possibilities to follow their plan to get where they want to be.

For example, when they start their journey defined with their business plan, they can quickly find that will need to change the direction. That means the business will need to go to D first to reach the position B. In such a way carefully prepared plans will have to be adjusted because they quickly become irrelevant.

Changing the Direction as a Part of Diagnostic Model of Organizational Change

Another thing that entrepreneurs can find when they start the implementation of their plans is that it is better to go to position C instead of position B.

But that’s not only problems entrepreneurs will face on their entrepreneurial journey.

On their way to get to the final destination, they will have different obstacles and constraints. Some of them will be already predicted in your business plan. But usually, the larger part of them will appear as they go on their entrepreneurial journey.

It doesn’t matter whether they go from A to B, or they have already discovered changes in the environment of the business that tells them to change their current route and go to C instead to B. Or, if they find that they need to go to D first to get to B, the path to the final destination will always have different type of obstacles and constraints. They will need to overcome them if they want to get where they want to be. These obstacles and constraints on their way are caused because of different forces that make a pressure on companies. Those forces are sources of organizational changes.

Because of the expected uncertainty, today’s managers will need a diagnostic model of organizational change. This model will allow them to follow different sources of organizational change, analyze their internal and external environment and update sources that they already have and manage. One simple form of this diagnostic model of organizational change is presented in the figure below.

The basic principle of this model besides the initial collection of different sources of organizational change is the part of the continuous analysis. It is important to predict the future steps of the company. So you need to do a continuous analysis of the internal and external environment of the company. In such a way you can locate different problems. These problems will also update your initial collection of drivers for change. So, you will be prepared for the future.