Top-led organizational change has a far greater chance of achieving success than change driven by lower levels. Organization change has greater impact and involves costly systems and technologies on which only top management can take decisions. There are certain assumptions about top management to top-led organizational change. Top-led approach is not CEO driven but a joint effort of all the senior executives. Senior executive should be talented and should not be blindsided by their histories if top-led organizational change has to work.
However, it does not mean top-led change is purely top-down effort, in which there is no participation within the organization. Today there are multinational competitors, more open markets and more advanced technology. In order to manage the intensified external environment, the company’s strategy should be susceptible towards organization-wide changes. Corporate strategy is set largely by top level management with the participation of middle management. Strategic changes demand multifunctional changes. In today’s change efforts e.g. significant alterations in structure, systems, and corporate cultures and high capital requirements etc, it is hard to believe that change can be driven by lower levels of an organization.
In bottom-led change functional or departmental biases and blind sight to the cross-functional implications are major obstacles. Junior level managers may lack courage needed to set and achieve radical goals. They also have limited access to capital, they cannot take decisions on expensive alterations in the information systems and technology driven processes that span the entire organization.
Top down changes are essential in the rapidly moving world. Moreover in today’s transition, corporate are changing their strategies, structures, and information systems in major ways. Data shows that these changes are largely top-driven. There are three distinct advantages for changes bring about by senior leaders. Firstly the senior level horizon for perspective and strategy-formulation can gauge then changes that are happening in an effective manner. Secondly senior leaders have a unique advantage over juniors that they can harness the power of attribution process (Attribution process reflects our need to explain events through deliberate actions of individuals.). Thirdly the leadership itself has positional power. Higher level power is lesser susceptible to change than lower level executive power because of lesser organizational inertia. Junior managers are in a difficult position when it comes to setting demanding stretch targets for themselves. Access to resources in an organization is also affected by position power.
Senior manager should look the things from a broader perspective whereas it would be difficult and even inappropriate for top management to take responsibility for determining local structures, crafting local strategies and tactics, or making many operational decisions.
