Managing Change: By the book or the seat of your pants?

Two cases from a Danish manufacturing facility are presented in this paper to illustrate challenges that may arise when attempting to apply theory in practice. In the first case, perceived environmental instability precipitated a change from a functional team design to a product/market design. Contingency theory suggests that product oriented teams should provide greater flexibility in turbulent environments and this is what happened here. The teams became more customer-service oriented, motivated, and satisfied. Later reevaluation of the environment suggested increased stability, so the teams were returned to their functional duties, which resulted in poor performance, low motivation, and dissatisfaction. The second case describes what happened when the corporate headquarters attempted to centralize HRM functions, which had become relatively decentralized as teams became semi-autonomous. Again, this change was based on contingency theory, but this time the environment was classified as stable, where centralization may be prudent. These changes were perceived quite negatively by the teams and attempts to remedy the situation were extremely costly and stressful. The authors suggest a number of possible explanations for why "the book" did not always provide the guidance and direction needed to make these changes successful. For example, we propose that, as humans, we are probably not capable of seeing a situation for all angles or including all important contingencies into consideration when adapting a theoretical model for practice. The paper ends with a number of questions intended to inspire discussion among researchers and their industrial partners.