In order for a company to survive, it must change. Change can be very disruptive and cause companies to fall apart. Therefore, companies should make major changes that are interspersed with smaller changes. This allows for companies to manage change using the dynamic stability approach.
The Problem with Change
Typically changes in the past have involved companies making changes that maximize the growth of the company or increase economic value as fast as they are able to. Companies have made changes and have only considered the short term effects of those changes. With the use of the dynamic stability approach the changes that are made can last over both the short term and long term.
Dynamic stability is a process of continual but relatively small change efforts that involve the reconfiguration of existing practices and business models rather than the creation of new ones." (p. 76).Dynamic stability involves three objectives. These objectives are tinkering, kludging, and pacing.
involves using what a company already has in their possession to try and make
something new. This is less costly than if companies went outside the company to create something brand new.
Kludging is a form of tinkering but just on a larger scale. Kludging involves more parts that are needed to create the change and often times kludging can result in a new division for a company or a whole new business.
Pacing involves making changes at the right time. If a company has not made any recent changes, then they will need to make rapid changes to catch up. But a company that has been making many changes will need to slow down from their rapid changes to tinkering and kludging.