Organizational change and change readiness : employees’ attitudes during times of proposed merger

Abstract

The objective in this thesis is to investigate the effects of organizational change. This is done through the review of literature and empirical analysis. An important part of this process involves developing measurements of the main constructs of interest; job satisfaction, uncertainty, commitment and change readiness. The relationship between the main constructs and change readiness is then investigated with special emphasis on testing hypotheses introduced under the first of three propositions. Further analysis then investigates two more propositions, one testing the assimilation of attitudes of Executive Managers and employees’ to organizational change, and one testing the relationship between the rate of change and change readiness. The study is based on two types of primary data. One is a questionnaire survey administered among employees of three Icelandic governmental organizations, all considered applicable for a merger. Another type of data was gathered by conducting interviews with Executive Managers of all three organizations. Findings suggest that change readiness increases as measured levels of job satisfaction increases. Findings also suggest that change readiness increases as uncertainty decreases, but the relationship between change readiness and commitment is not determined by the findings. Two of the three organizations surveyed had significantly different levels of change readiness. Findings suggest that employees’ change readiness is reflected in the attitudes of Executive Managers. Findings also suggest that employees and Executive Managers in organizations facing discontinuous or radical change do not report lower levels of change readiness, than those facing incremental organizational change.