Configurations of Employee Assessments of Past Changes: Do Leadership and Learning Matter?

Abstract

Organisational change studies increasingly interpret the phenomenon as multiple change, and not a one-time occurrence. Even successful changes may have detrimental longer-term effects - change fatigue, resistance, and undermined cohesion. These might hamper the organisational capabilities needed to navigate current and future changes. Previous research highlights the importance of transformational leadership and learning culture for maintaining organisational capabilities to change sustainably. Employees’ interpretations of past changes largely shape their (future) attitudes – were they involved in decision-making, were consequences personally (organisationally) beneficial, and did change break the team cohesion. This paper argues that learning organisation and transformational leadership practices are related to how employees experience and interpret past changes. A configurational approach is employed. The research aims to reveal the relationship between learning organisation (LO) and transformational leadership (TL) with three variables associated with how employees evaluate past changes – history with change (HC), valence (VA), and cohesion (CO). The study is quantitative and uses a standardised questionnaire. The level of research is individual, the sample consists of 188 respondents – managers and employees in firms in Bulgaria. Five composite variables measured by scales adapted from previous research are used. HC, VA, and CO are applied in cluster analysis which reveals three distinct clusters. Cluster 1 consistently shows the highest scores on all three variables, and Cluster 3 – the lowest. The three clusters are profiled using demographic variables, TL and LO. Of all demographic variables, only job position has a statistically significant correlation to cluster membership, suggesting that management and employees experienced past changes differently. Respondents in Cluster 1 gave the highest scores on TL and LO at their workplace, while Cluster 3 had moderate scores. The main conclusions support the argument that transformational leadership and learning organisation are related to how employees interpret past changes. There are several theoretical and practical implications. The research provides empirical evidence on the five variables' relationships thus adding to organisational change studies’ advancement. The results highlight the importance of monitoring how employees internalise change consequences. Failing to do so might be detrimental to the organisational change capabilities.