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Change Theory

Organizational change is one of the most popular topics in organizational research and practice, and healthcare is not an exception to this rule. Contemporary healthcare is characterized by the growing number of private and public players. Consequently, the level of competitiveness in the healthcare field continues to increase. It is obvious that only organizations that manage to successfully adapt to the changing conditions of environmental performance can develop and sustain a strong competitive advantage. Those organizations, which are capable of achieving and maintaining a unique balance of stability and change, are even more successful. Trust plays a crucial role in maintaining stability and pursuing change within the healthcare organizations. According to Leana and Barry (2000), trust is a basis for creating organizational social capital and a means of developing effective collaborative relations among workers as they pursue change or seek to achieve relative stability in organizational performance.

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Summarizing the Readings

Present-day organizations operate at the edge of stability and change and between the extremes of adaptability and commitment. Heskett (2011) provides an overview of the adaptability versus commitment issue. At the center of Heskett’s (2011) attention is the question of whether the organization’s ability to be adaptable undermines its tendency to commitment. The answer lies on the surface: adaptability and commitment are not the opposites; rather, they are the two complementary concepts (Heskett, 2011). Adaptability is a buzzword used by organizations to address their worries of organizational and environmental uncertainty (Heskett, 2011). It is one of the central concepts in the analysis of organizational growth and success. Heskett (2011) writes that in the world of interconnectedness, effective planning is extremely problematic and rare. Therefore, in almost all situations, trial and error is the only way for organizations to solve their growth problems (Heskett, 2011). Therefore, Heskett (2011) offers a simple recipe for the organizations that want to be successful. The strategy is quite comprehensive: finding an innovative solution to the existing problem and trying it at a scale that would not result in a total failure (Heskett, 2011). The proposed recipe is one of the most wonderful examples of how organizations can adapt to the changing conditions of operation. Still, Heskett (2011) recognizes that organizational growth in the interconnected world cannot be easy. Moreover, there emerges the question whether adaptability and flexibility are better than stability and commitment (Heskett, 2011). Leana and Barry (2000) try to answer it in their work.

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According to Leana and Barry (2000), modern organizations pursue change since it is believed to facilitate their adaptability and adjustment to flexible environmental conditions. Simultaneously, the same organizations emphasize the importance of stability, particularly at the workplace, and employment relations (Leana & Barry, 2000). Leana and Barry (2000) present change and stability as two simultaneous experiences and the tension between stability and change as being inevitable for most organizations. Still, only organizations that are clear about why they pursue change and seek stability can successfully resolve the emerging tension between the two.

Leana and Barry (2000) go on to elaborate on the reasons for pursuing change. In their view, change is an inevitable component of life in any organization, but in almost all cases, a number of forces drive an organizations’ desire for flexibility and change (Leana & Barry, 2000). Adaptability is one of the chief arguments in favor of continuous change and flexibility (Leana & Barry, 2000). In increasingly unpredictable environments, stability can become a serious barrier to organizational growth and advancement. Cost containment is another driving force behind continuous change as it has the potential to bring considerable cost savings (Leana & Barry, 2000). Impatient capital markets and the need of control are also cited as the two essential factors of continuous organizational change, which enable firms to adapt quickly to the rapidly changing conditions of capital market performance, while empowering them to control their movement towards the most challenging targets (Leana & Barry, 2000). Lastly, competitive advantage is referred to as one of the most essential factors of continuous change in organizations since responsiveness to changing market demands may be enough to generate a sustained competitive advantage (Leana & Barry, 2000).

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No less serious are the factors of stability in an organizational environment. Despite the fact that change often becomes the only source of competitive advantage, many organizational forces are likely to work against such change (Leana & Barry, 2000). Among the chief forces driving stability within organizations are transaction costs and organizational social capital (Leana & Barry, 2000). Stability is a better means of reducing transaction costs than change, particularly when employees seek greater job security and a higher quality of employment relationships. Stability also entails the creation and usage of inimitable resources that favor the development of a sustained competitive advantage (Leana & Barry, 2000). Organizational social capital is a concept that implies the presence of effective social relations among members of the same organization (Leana & Barry, 2000). Stability also becomes the result of the organizations’ striving to achieve predictability and reduce uncertainty (Leana & Barry, 2000).

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Organizational Trust and Its Effects on Stability and Change in Organizations

Based on the readings summarized in this work, an important question is how organizational trust affects stability and change within organizations. Trust is one of the key concepts used by Leana and Barry (2000) in their analysis of stability and change. To a large extent, trust is a complex phenomenon that creates reciprocal meanings. It is both the source and result of organizational change and a factor of stability in organizations. On the one hand, according to Leana and Barry (2000), “trust and associability are most readily created in stable work environments and can be threatened or undermined by change that is too rapid, frequent, or unpredictable” (p. 5). On the other hand, trust creates the needed framework for pursuing change and achieving stability in the collective relations among the workers. The success of both stability and change depends greatly upon the level of trust in individual and interpersonal contexts (Leana & Barry, 2000).

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