Impact of Organisational Change Performance of Selected Construction Firms ()
1. Introduction
Modern businesses are constantly challenged to adapt to the dynamic internal and external business environments in order to compete and develop in today’s market ( Nudurupati et al., 2021 ). Organizational transformation has become an important element of working life, with adjustments necessary at both the organizational level and at the individual employee level ( Anderson, 2013 ). Change indicates an organizational transformation. This shift may be intentional, with the objective of acquiring or losing certain organizational qualities to achieve a specified goal, or it may be unintentional, happening as a result of events outside the firms grip ( Fløvik et al., 2019 ).
Organizational change is the partial or complete incorporation by members of a new idea, concept, or behaviour ( Homberg et al., 2017 ). Organizational transformation, according to Yang et al. (2018) , concentrates on changing the mission and objectives, organizational strategy, culture of the organization, the organizational framework, structure, and manufacturing processes. It is caused by environmental conditions and the need to correct underlying structural problems. Change, in a broader sense, refers to a system of ongoing alterations in one or more organisational domains, including organisational technology, structure, and human resources ( Sofat & Kiran, 2014 ).
One of the primary reasons why organizations must adapt nowadays is the advancement of technology. Firms must adapt and apply new technologies to accommodate new raw resources, products, processes, and activities, and their employees must constantly refresh their expertise. New globalization patterns, mergers, acquisitions, and business restructuring are further factors demanding change. Markets operate more like a dynamic system than a collection of processes that cannot accommodate new requirements or address issues. This is due to the fact that supply and demand are always changing, new methods are introduced or removed, and new services are produced. Finally, we must remember that social and political concerns affect companies and drive their transition processes.
Organizational transformation has several goals, but the key components are improved performance, avoidance or elimination of organizational issues, and the capacity to endure rivalry and environmental upheaval ( Ramakrishnan, 2021 ). Therefore, any feasible change programme must be supported by a solid communication strategy to help convince employees that change is required, to help them understand how change will benefit them, to detect any weaknesses in the change programme, and to maintain open communication lines. Due to this, the purpose of this study sought to evaluate how organizational reorganization affected business performance.
According to Errida and Lofti (2021) , even authors who discuss why efforts do not succeed, fail to grasp that the underlying problem is a clash of values between the organization’s values and the change method and type it has embraced. This study focuses on enabling organisational transformation with the most effective change strategy. There has been much dispute in the literature on the best acceptable strategy for reforming organizations ( Brown & Harvey, 2021 ). Organizations must recognize that change is never fast nor simple, but may be more flexible and well-planned ( Al-Haddad & Kotnour, 2015 ).
The major purpose of this research was to ascertain the impact of organizational change on the performance of construction firms. The following hypotheses were used to drive the goals:
Ho1: There will be no significant relationship between Drivers of Change and Performance.
Ho2: There is no significant difference between Resistance to Change and Performance.
Ho3: The Critical Factors for Managing Change do not have significant effect on the Performance.
Ho4: The Implementation of Changes does not have significant effect Performance of Selected Construction Firms in Nigeria.
The Concept of Change
In today’s highly volatile world, firms are frequently pushed to make important adjustments in light of the fluctuating customer needs, technical advances, and competitive activity. In order to be competitive and adapt to market changes, businesses must adapt their structures and processes in a flexible manner ( Anning-Dorson & Nyamekye, 2020 ).
Change is a natural phenomenon that is inextricably intertwined with continuity, and the change-continuity continuum characterises organisations and their capacity to exploit and explore. They also assert that transformation as a component of an ongoing continuity project necessitates a much bigger picture that seeks out opposing viewpoints and deals with the resulting ambiguities, inconsistencies, and tensions of an unpleasant reality.
The effects and repercussions of change on an organisation and its members vary based on the type and form of the change, but most significantly on how it is managed. The adjustments must be managed to maximise the advantages, minimise the penalties, and guarantee that both the benefits and penalties are spread fairly ( Asnan et al., 2015 ).
Change management becomes both more vital and more challenging for construction organisations with a geographically scattered organisational structure, a multi-disciplinary nature, and the management of unique projects with variable interactions. On the other hand, not all changes are undesirable. In a climate characterised by ever-increasing global rivalry and customer expectations, change management has emerged as a crucial aspect in the drive to remain competitive ( Cao & McHugh, 2005 ).
Concept of Performance
To perform is to carry out a difficult chain of tasks that combines abilities and knowledge to yield a useful outcome. Effective management depends on performance measurement. Since measurable items are acceptable, management of an organization and improving the procedures are both possible. As a result, measuring organizational performance is necessary to ascertain how change management intensity affects business performance. The basis of strategic management is the idea of performance; most empirical studies of strategy employ the concept of company performance to look at various strategy-related content and process concerns. The numerous performance guidelines show how crucial performance is to management.
Enhancement. As a result, measuring organizational performance is necessary to determine the impact of dependency on company performance. Evaluation of performance is crucial. Without outcome assessment, the organization cannot govern itself effectively, and process improvement is unattainable.
Performance is impacted by changes on an individual, team, and organizational level. People develop through experiment and interest, teams learn by valuing different perspectives, and organizations learn through disciplined experimentation and continual development. Good things happen when there is a change. People lead fuller lives and are more dedicated to their jobs. Teams are far more competitive and efficient than organizations. Employees must take responsibility for their own learning; it is insufficient to just say that others should. Since everyone has a responsibility to themselves, they should also be accountable for their own education. Making decisions, understanding the effects of those decisions, and taking remedial action are all necessary for this to happen ( Kumar & Ramsay, 2014 ).
2. Empirical Review
Al-Haddad (2014) investigated effective organisational transformation and the relationship between change kinds and techniques. Using the presented data, exploratory component analysis was used to verify the conceptual model’s measurements. The findings showed a strong correlation between successful transformation, the usage of change methodologies, and the multifaceted nature of the change type. In addition, the research found that the alignment of change type and change methodologies had a significant effect on the effectiveness of organisational transformation.
Hallgrímsson (2008) performed a study on the attitudes of workers towards potential mergers. The study used two distinct forms of source data. The first was a survey consisting of a questionnaire issued to the staff of three government organisations in Iceland that are all candidates for merger. The other strategy was conducting interviews with management from each organisation. The findings indicate that the attitudes of senior managers match the adaptability of workers. The findings also suggest that employees and top managers do not demonstrate lower levels of change readiness than those in organizations undergoing progressive organizational transformation.
In a separate research, Gaylor (2001) examined the influence of higher education and trust on police officers’ reluctance to change, as well as the impacts of involvement and communication on trust. Prior research rated involvement as the most important element; nonetheless, the data supported the notion that engagement and communication improved trust.
Ismail et al. (2006) explored the creation and implementation of a new management system, a quality management system based on ISO 9000, at a Malaysian university faculty. They found that by incorporating workers from the start of a change programme, it is possible to create interest, distribute information, and maximise participation.
Singh et al. (2012) conducted a research to evaluate a hypothesis about the factors that cause workers to resist change. They discovered that the change approach was a significant influence. Similarly, Boohene and Williams (2012) investigated the reasons why individuals resist organisational change. They came to the conclusion that a lack of confidence in management and a lack of participation in the decision-making process were significant drivers to resistance.
Austin and Isaac (2012) investigated how industrial organisations in Port Harcourt, Nigeria manage change. They found that change management is a terrific instrument for enhancing the effectiveness of industrial organisations, and that if it is emphasised more, industrial organisations would surely reach high criteria.
In a research on the effect of commitment and work insecurity as predictors of openness to organisational change, Sunday (2013) revealed that commitment and job insecurity contributed considerably to openness to organisational change.
Abdulraheem et al. (2013) investigated the repercussions of planned organisational change in Nigerian public education systems. According to the study, changes are easy to conceive but difficult to execute, and they often face popular resistance.
Onyango (2014) evaluated the causal impacts of organisational culture on change management using a descriptive survey approach. The study found that organisational beliefs and values had an effect on organisational transformation. Also shown is that organisational norms have no significant influence on change management. However, support from upper management has a significant influence on organisational transformation. Okiiya et al. (2015) found that the adoption of change management strategies by public secondary schools in Kenya’s Siaya Sub County had a significant influence on performance. Muo (2014) confirmed, via a study of a diverse sample of managers in the five South-Western States of Nigeria, that resistance is the most major obstacle to change management and that resistance to change has a largely negative effect.
Effective change management is described by Ali and Anwar (2021) in his article titled “Effective Change Management” as the strategy used to help all workers in adjusting effectively to organisational changes. Its purpose is to transform an employee’s present state of mind into a desirable future condition. As the globe gets more linked, the global economy and industries become more globalised. Emerging markets, financial institutions, the housing market, education, and health care are all experiencing crises. Success will be measured by the degree to which these technologies alter how we manage the workforce and how effectively it functions.
3. Methodology
A cross-sectional survey approach was used in this investigation. This strategy is appropriate for this investigation since survey studies are a great way to get a lot of data from a large population. This design describes the links and consequences of the variables in considerable depth. This strategy was chosen due to the researcher’s intention to utilize the primary data collected through the questionnaire. The descriptive survey approach is chosen because it focuses largely on crucial facts, views, opinions, demographic information, attitudes, motivations, and behaviors of research instrument respondents ( Ajike et al., 2015 ).
The study population comprises of the managements and staff of construction firms in Nigeria using the following firms as the subject of the study Phefa Construction Company Ltd., Abacus Building Services, Dumez Nigeria Plc, Enerco Nigeria Limited and RCC Construction Company. The firms were selected based on their listing by the Federation of Construction Industry (FOCI). The parameters included size, active projects, spread of operation, and portfolio of services offered. The entire staff strength of the selected construction is about one thousand, two hundred and four (1204).
However, stratification technique was first used to stratify the 1204 workers of the construction companies.
N = 1204 (number of people in a population);
e = 0.05 (available error %);
n = sample size required.
So, the sample size is 300.
4. Results and Discussions
The results of this study are discussion in line with the formulated hypotheses as shown below:
Hypothesis 1
Ho1: There is no significant relationship between Drivers of Change and Performance of Selected Construction Firms in Nigeria.
The data acquired on the drivers of change related to additional data collected on the performance of a chosen organization using Pearson Product Moment Correlation Analysis in order to analyze hypothesis one. The findings are shown in Table 1 below.
The aforementioned Table 2 shows that the mean driver of change (7.30) is higher than the organization’s average performance (7.09). The r-calculated of 0.699 indicates a positive and substantial link between Drivers of Change and Performance of Selected Construction Firms in Nigeria, which gave meaning to this difference. Thus, the null hypothesis is rejected.
Hypothesis 2
Ho2: There is no significant relationship between Resistance to Change and Performance of Selected Construction Firms in Nigeria.
Table 2 revealed that the calculated r of 0.734 is significant at 5% (p = 0.00 < 0.05). This implies that a favorable and substantial relationship is reported between Resistance to Change and Performance of Selected Construction Firms in Nigeria. The null hypothesis is rejected.
Hypothesis 3
Ho3: The Critical Factors for Managing Change will not affect the Performance of Selected Construction Firms in Nigeria.
Table 3 revealed that the calculated r of 0.608 is significant at 5% (p = 0.00 < 0.05). This indicates that a favorable and substantial relationship is reported between The Critical Factors for Managing Change and Performance of Selected Construction Firms in Nigeria. The null hypothesis is rejected.
Hypothesis 4
Ho4: The Implementation of Changes will not affect the Performance of Selected Construction Firms in Nigeria.
Table 4 revealed that the calculated r of 0.793 is significant at 5% (p = 0.00 <0.05). This implies that a favorable and substantial relationship is reported between The Implementation of Changes and Performance of Selected Construction Firms in Nigeria. The null hypothesis is rejected.
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Table 1. Relationship between drivers of change and performance of selected construction.
r-calculated = 0.699, df = 298; r-critical = 0.; r-calculated > r-critical; significant value (p) = 0.000 < 0.05.
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Table 2. Relationship between resistance to change and performance of selected construction.
r-calculated = 0.734, df = 298; r-critical = 0.; r-calculated > r-critical; significant value (p) = 0.000 < 0.05.
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Table 3. Relationship between the critical factors for managing change and performance of selected construction.
r -calculated = 0.608, DF = 298; r-critical = 0.; r-calculated > r-critical; significant value (p) = 0.000 < 0.05.
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Table 4. Relationship between the implementation of changes and performance of selected construction.
r-calculated = 0.793, df = 298; r-critical = 0.; r-calculated > r-critical; significant value (p) = 0.000 < 0.05.
5. Discussion of Results
According to the findings, there is a substantial relationship between change drivers and the performance of selected Nigerian construction enterprises. This was according to Kreitner and Kinicki (2010) Mission changes, strategic changes, operational changes (including structural changes), technical changes, and changes in staff attitudes and behaviours are all examples of organisational change. Combat opposition from diverse firm personnel and align them with the corporation’s strategic aims. The tangible component, according to Bourne and Bourne (2011) , comprises hiring the proper people for a specific task, having the right equipment for the job, a pleasant physical working environment, and a reasonable reward for the job. Intangible aspects range from the clearly stated, such as working for a well-known corporation, to the extremely personal, such as a feeling of success and appreciation. Individual, team, and organisational performance are all affected by changes. Individuals learn via curiosity and trial-and-error, teams learn through the exchange of ideas and feedback, and organisations learn through disciplined continuous improvement and trial-and-error. Positive results arise when there is change. People lead better lives and are more devoted to their careers. Organizations and teams are more competitive and productive.
The second hypothesis found a significant relationship between Change Resistance and the Performance of Selected Nigerian Construction Firms. This is consistent with De Marchi et al. (2013) assertion that organisations today operate in an increasingly competitive and rapidly changing environment, and that in order to stay competitive and up to date, both public and private organisations must have the necessary capabilities and know-how to effectively use them ( Schienstock, 2009 ). Change management and organisational competences are understood to be a continuous and open-ended process ( Teece, 2012 ; Mohrman & Lawler, 2012 ).
The third hypothesis revealed that The Critical Factors for Managing Change would have an impact on the Performance of Selected Nigerian Construction Firms. This corresponds to what Leonard-Barton (1992) considers to be the essential elements and set of knowledge that differentiate an organisation and produce competitive advantage. However, the capacities of different organisations differ. Because companies are diverse, even though they operate in the same sector and provide similar goods and services to the same target consumers, they have developed their own routines. These various methods of behaving and responding are defined as the talents that an organisation acquires through time. As a result, Dosi et al. (2000) classify these capacities as historical. This notion is untrue, contrary to what Porter (1991) indicates, which is that organisations may produce opportunities based on their strengths. It has been proposed that the opposite is true: organisations identify opportunities and distribute resources depending on their capabilities ( Schienstock, 2009 ). According to Dosi et al. (2000) , an organization’s capacity to allocate adequate, suitable, and timely resources to skill generation will ultimately become its capability.
The research indicated that implementing changes would have an influence on the performance of selected Nigerian construction firms. Others ( Vaccaro et al., 2012 ) agree that implementing change in an organisation is a challenging task that can only be completed if leaders and change agents are capable of managing the effect of these changes correctly. According to Evans et al. (2004) , organisational change management includes all stages necessary for an organisation to grasp, prepare for, execute, and fully benefit from the intended change. Furthermore, Burgoyne et al. (2004) state that the development of organisational competences encompasses a wide range of fields. The first is a widespread mindset. This requires building a common view on objectives and how to attain them among individuals both within and outside the firm. Developing this unified style of thinking would therefore be a critical skill.
6. Conclusion and Recommendations
The conclusion of the research is that there is a substantial correlation between change drivers and the performance of selected Nigerian construction enterprises. It is difficult to assess the effectiveness of change initiatives that enhance performance. Organisations must be aware of the obstacles to performance achievement and the important success criteria that will ensure the success of change projects. The literature and research on change indicate that encouraging organizational growth requires effective change management. The enhancement of organizational performance in Nigeria will be substantially aided by expanding this study to assess the effects of change on performance. The research also derived the following conclusions: there is a substantial association between resistance to change and performance, important elements for managing change will affect performance, and changing implementation will impact the performance of chosen construction enterprises in Nigeria.
As a consequence, it was proposed that organisations pick the most effective change model for their endeavour and then adjust it to meet the situation. Organizations should gather evidence from numerous sources when evaluating skill gaps. Before engaging in a deep discussion on a change, the design team must have a clear, exhaustive, and accurate overview of the existing status of the organisation. It is possible to examine capabilities, resources, committed plans, competitive evaluations, and gaps. Lastly, the board of directors should organise strategic training programmes for the workforce in order to educate them on organisational transformation and current developments.