Factors that Cause Change in Organizations: Planned and Unplanned

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

Coming up next: Overcoming Barriers to Change in Organizations

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
 Replay
Your next lesson will play in 10 seconds
  • 0:05 Types of Change
  • 1:15 External Forces of Change
  • 3:52 Internal Forces of Change
  • 5:37 Lesson Summary
Add to Add to Add to

Want to watch this again later?

Log in or sign up to add this lesson to a Custom Course.

Login or Sign up

Timeline
Autoplay
Autoplay

Recommended Lessons and Courses for You

Lesson Transcript
Instructor: Jennifer Lombardo
Planned and unplanned are the two types of changes that can occur with an organization. External and internal factors can cause both of these types of changes within a company.

Types of Change

Every day for the past 30 years, Robert went to work at Cheapo Toys in the marketing department. He loved his job and was proud of all of his accomplishments. One day, on his way into work, he was greeted by a human resource manager. The manager took Robert aside and informed him that the company was having a corporate-wide layoff. Robert was laid off immediately and given a severance package. He was in total disbelief! Cheapo Toys' layoff was a huge change for the organization, and it occurred due to a number of factors.

Planned and unplanned are the two types of changes that can occur with an organization. Planned change occurs when deliberate decisions are made in an organization, while unplanned change is a result of unforeseen occurrences. Ironically, the layoff was a planned change for Cheapo Toys, but an unplanned change for Robert. External factors and internal factors can cause both of these types of changes within a company. Let's take a look at specific examples of each with Cheapo Toys as our backdrop.

External Forces of Change

An external force of change occurs from an outside influence on the organization. There are four main external forces of change:

  • Globalization
  • Workforce Diversity
  • Ethical Behavior
  • Technology

Cheapo Toys' original employees consisted of American employees who operated at two East Coast locations. Due to the globalization of the economy, the company was forced into many changes over the last 20 years. Cheapo Toys' competitors did not just consist of American companies but foreign as well. The kid population was declining in the U.S., so Cheapo Toys had to look elsewhere for sales. A big change for Cheapo Toys was building factories and selling overseas. The company now operates in over 10 different countries, ranging from France, London, Japan and India.

A diverse workforce has also created a huge change for the company. When Cheapo Toys began years ago, most of their workforce consisted of men. Now, females are represented equally and all ethnicities exist within their various international locations.

The third external force of change is society's expectation of ethical behavior. Companies are now held to a higher standard of ethics. For example, companies have a social responsibility to ensure that their products do not damage the environment during the production process. Companies also have to conduct themselves ethically when it comes to their finances. Cheapo Toys has had to make huge changes in how they design, manufacture and sell their toys. All of their toys now have to be made with plastics made of safe chemicals for kids. In addition, the company has had to hire additional quality engineers to make sure that the products are designed for all of the changed safety standards.

The last external force that creates change in organizations is technology. Companies constantly have to change every aspect of their work life to ensure that they remain competitive. For example, Cheapo Toys just completed a three-day sales training session. All of their sales reps' laptops were traded for tablets. The tablets allow for easy presentations, traceability and sales order processing. Companies need to stay ahead of the technological curve or they will be left behind. Only 15 years ago, Cheapo Toys relied on just voicemail and emails for their sales reps' daily workload.

There are also numerous internal forces of change that companies must monitor.

To unlock this lesson you must be a Study.com Member.
Create your account

Register for a free trial

Are you a student or a teacher?

Unlock Your Education

See for yourself why 30 million people use Study.com

Become a Study.com member and start learning now.
Become a Member  Back
What teachers are saying about Study.com
Free 5-day trial

Earning College Credit

Did you know… We have over 160 college courses that prepare you to earn credit by exam that is accepted by over 1,500 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Create an account to start this course today
Try it free for 5 days!
Create an account
Support