Research purpose: This study investigated the extent to which employees were ready for change as an indication of whether their organisation was ready to introduce a performance management system (PMS).

Motivation for the study: Introducing system changes in organisations depends on positive employee preconditions. There is some debate over whether organisations can facilitate these preconditions. This research investigates change readiness linked to the introduction of a PMS in a public sector organisation. The results add to the growing literature on levels of change readiness.

Research design, approach and method: The researchers used a quantitative, questionnaire-based design. Because the organisation was large, the researchers used stratified sampling to select a sample from each population stratum. The sample size was 460, which constituted 26% of the total population. They used a South African change readiness questionnaire to elicit employee perceptions and opinions.

Main findings: The researchers found that the organisation was not ready to introduce a PMS. The study identified various challenges and key factors that were negatively affecting the introduction of a PMS.

Practical/managerial implications: The intention to develop and introduce performance management systems is generally to change the attitudes, values and approaches of managers and employees to the new strategies, processes and plans to improve productivity and performance. However, pre-existing conditions and attitudes could have an effect. It is essential to ensure that organisations are ready to introduce performance management systems and to provide sound change leadership to drive the process effectively. This study contributes to the body of knowledge about the challenges and factors organisations should consider when they introduce performance management systems.

Contribution/value-add: This research adds to the knowledge about aspects of change readiness, change management and introducing change initiatives.

An assessment of organisational readiness should lead to the development of a model of the preconditions necessary to introduce performance management systems appropriately to organisations, with greater emphasis on employee buy-in, involvement in the process and proper communication of the change process (Karve, 2009).

All the previous attempts to design and introduce a performance management system (PMS) to the organisation had failed. Therefore, the key focus of this study was to conduct a diagnosis to determine the readiness of the organisation to introduce one.

The system had weaknesses because it did not set performance standards and was very open to bias, nepotism and favouritism during the performance appraisal process. As a result, the organisation suspended the performance appraisal system in 1998. Since then, the organisation has not introduced an institutional mechanism to improve, measure, monitor or evaluate its staff and the performance of the organisation.

All municipalities are subject to administrative and operational changes to improve their performance and productivity, as well as to achieve broader organisational objectives (Kok, 2007). In a response to the lack of a PMS, the city council decided to design and introduce a functioning PMS as part of a change process.

The present research aimed to investigate the level of readiness of the organisation to introduce a PMS. The rationale for this is that organisations cannot introduce performance management systems successfully without the buy-in and involvement of all employees and a strategy to develop human resources so that everyone has a clear understanding of the change initiatives and their benefits to employees and their organisations.

Therefore, it is crucial to unearth the key factors or pre-conditions for introducing performance management systems and to determine and evaluate the attitudes and feelings of employees about doing so.

Change readiness is the best early indicator of what lies ahead. The scars that successful and unsuccessful initiatives have left are others (Bridges, 2010). The key to change readiness is whether the employees are ready to do their jobs in new environments (Madsen, Miller & John, 2005). Introducing performance management systems as change initiatives is pivotal to the strategies of organisations and they should ensure organisational readiness before doing so (Canterucci, 2008). When organisational readiness for change is high, the employees are more likely to initiate change, exert greater effort, show greater persistence and display more cooperative behaviour (Armenakis & Harris, 2002).

All over the world, local governments are under pressure to modernise, transform and become accountable to their communities. One way they are achieving this is by introducing performance management systems (Williams, 2006). However, implementing these systems requires change and the success of these changes depends on the readiness of the organisations.

Organisations need to manage change in order to reduce resistance to it by, for example, introducing performance management systems. Change management coordinates a transition to achieve lasting change in organisations (Jones, Jimmieson & Griffiths, 2005). Organisations often present it as a process and use tools and techniques to manage people in order to achieve the required business outcomes (Nickols, 2006; Robbins, Odendaal & Roodt, 2003). A key starting point is to determine when organisations are ready to change.

Change readiness includes the management strategies that organisations use to address any resistance in their workforces to the new initiatives (Stratman, 2002). Organisations’ readiness for change depends on the level of employees’ commitment to the change and whether they believe the change can happen (Weiner, 2009).

However, these writers assume that a PMS is already in place or that is an acceptable innovation to the organisation. Being able to develop a PMS has its own challenges and cultural resistance.

Organisations need to be ready for the change and need to manage the change to performance management systems. Robbins et al. (2003) argue that employees may feel threatened, in terms of their interests and job security, if organisations just introduce new performance management systems. On a systemic level, it is important that one recognises that organisations need to be ready for the new system. This includes the fact that employees need to understand what their organisations will achieve by introducing performance management systems, why they need the systems, how they will implement the changes and who will drive them (Robbins et al., 2003).

When organisational readiness for change is high, employees are more likely to be part of the change process (Armenakis & Harris, 2002; Madsen et al., 2005). On the other hand, when organisational readiness for change is low or non-existent, employees are likely to resist the change, put less effort into its implementation and persevere less in the face of implementation challenges (Weiner, Amick & Lee, 2008). Therefore, it is essential for managers to investigate the level of change readiness of their organisations before introducing new systems. Failure to do so may result in wasted finances and resources on systems that employees do not accept and may undermine.

Van Tonder (2004) argues that organisations need to identify and analyse their ‘self-concepts’, or the views they have of themselves. They should also analyse how other stakeholders see them (Bacal, 2007; Rogan, 2002). Other features of successful change in organisations include having clear change architectures (Bunker & Alban, 1996; Carnall, 2007; Jacobs, 1994), the buy-in and acceptance of stakeholders (Keet, 2005), clear overviews of the goals and directions of the change processes and the roles people will play (Hale, 2004). It is also essential to be open to hearing frustrations, engaging in dialogue and managing expectations (Ainsworth, Smith & Miller, 2002). Leaders must create a sense of urgency in their organisations, build teams that can guide the change processes, continually communicate the need for change and then empower people to carry out the required change efforts (Allio, 2005; Amanto, 2009; Bennis, 2006; Stensgaard, 2007). Poor leadership during the change process can mean that organisations become dysfunctional (Stacey, 2003).

Jones et al. (2005) assessed the effects of change readiness about introducing a new computer system to a state department. The authors found that readiness for change was associated with a positive organisational culture. This readiness was also associated with the successful introduction of the system.

Interestingly, attempts to develop change readiness cultures may not lead to successful introductions of new systems. Abdinnour-Helm, Lengnick-Hall and Lengnick-Hall (2003) investigated a programme to develop positive pre-implementation attitudes about an enterprise resource planning system. The authors found that length of time with the firm and position had a bigger effect on acceptance of the system than did any attempt to develop positive attitudes beforehand.

Canterucci (2008) argues that performance management systems, as change initiatives, are pivotal to the strategies of organisations and they should ensure that they are ready. D’Ambrosio (2007) proposed that organisations should structure the planning to include logical thought processes that will address the external and internal environments and look at the past, present and future.

In the current research, the managers of the organisation felt that the changing internal and external environments (social, political, technological and competitive) made it essential to develop a PMS (Costello, 1994; Weiss & Hartle, 1997; Williams, 2002).

The current study aimed to determine the key factors or pre-conditions for introducing a PMS in order to ensure successful implementation. The researchers also determined and evaluated the attitudes and feelings of the employees about a PMS.

The findings of this study will influence the decision-making processes about introducing a PMS effectively as part of a change process for the selected organisation. It will also serve as a guideline for determining the change readiness of other municipalities.

• Office of the Chief Executive Officer
• Finance
• Transportation
• City Police and Emergency Management Services
• Economic and Community Development
• Planning, Urbanisation and Environment
• Infrastructure and Waste Management
• Information Communication and Technology
• Electricity
• Human Resources.

There were seven groups, or strata, of employees in these departments (see Table 1):

• strategic executives
• middle managers
• supervisors or specialists
• skilled workers
• semi-skilled workers
• unskilled workers
• contract workers (Hitchcock & Hughes, 1995; Parsons, 1984; Salant & Dillman, 1994).

The researchers defined the study population and then determined the sample size. Given the questionnaire and nature of the questionnaire, they regarded a sample of more than 20% as appropriate (Salant & Dillman, 1994).

The researchers distributed questionnaires to 460 employees. They included 300 (65.2%) semi-skilled and unskilled employees at A-B bands, 155 (33.7%) skilled employees at E-C bands and five (1.1%) employees who had contracts. This final sample constituted 26% of the total population. The stratified random sampling technique meant that every employee in each stratum had an equal chance of selection and ensured a representative sample of the population (Plant & Douglas, 2006). However, employees completed and returned only 432 questionnaires. This number constitutes 25% of the total population.

The CRI uses an integrated theoretical model of inertia-related concepts or inertia contributory factors that numerous authors have identified (Roodt & Kinnear, 2007). The CRI enables users to identify a number of specific organisational change facilitating or inhibiting factors, which they can group into two broad categories: transformational and transactional variables.

The questionnaire for the study consisted of five questions based on biographical information and used 58 multiple-choice questions. All the questions in sections 2–13 came from the CRI, which its designers developed strictly for use in an organisational (corporate) setting for research and for diagnostic (consulting) purposes (Roodt & Kinnear, 2007).

Given that the questionnaire has a corporate and consulting slant, not all questions applied to a parastatal. The researchers excluded these questions. They acknowledge that this could affect the reliability of the questionnaire.

An example of the scale is shown in Table 2.

Other researchers report similar reliability scores. For example, researchers found a Cronbach’s alpha of .99 in a group of 340 managers in Australia and a Cronbach’s alpha of .78 for a group of 347 trainees who worked for a state organisation. The internal consistency reliabilities for the twelve dimensions varied between .677 and .896 with only two reliabilities below .80 (Van Rooyen, 2007).

The researchers allowed some participants (10%), who needed more time to think about specific questions, to take questionnaires home and complete them at their own pace, as Munn and Drever (1995) suggested. These participants returned the completed questionnaires the next day via their divisional heads and supervisors.

• the most influential people in the organisation did not champion the introduction of change initiatives
• the organisation did not always plan the change initiatives well
• the organisation did not consider all the components of the business when it planned the change initiatives
• the organisation did not involve the employees, who are affected by change, in drafting the change plans.

These responses could explain why employees were not committed to change initiatives in the organisation.

• would willingly choose to be a part of a change process (79.5%)
• were likely to change the way they work because of the change process (71.9%)
• were likely to focus on improving the current situation rather than pursuing the change process (56%)
• were unlikely to take the blame when the change process or its elements failed (48.1%)
• were willing to provide support for the rest of the change process (63.1%).

The finding that employees felt that top managers did not show any commitment to the change initiatives is significant. Without organisational buy-in and leadership from the top, a new system is unlikely to succeed.

These findings show that the work climate was not conducive for the change process at the time. Most participants argued that:

• people in their respective work units did not encourage each other to support the change process (68%)
• people did not see the change as positive for their respective work units (59%)
• the people the organisation selected to act as change agents were not fully trained (54%)
• there is no counselling available to people who suffer from the emotional effects associated with the change initiative (64%).

These intra-personal and inter-personal features would hinder support for the change process and might undermine it. Organisations need adequate preparation, education, communication and leadership to create the positive preconditions for change.

One of the most fundamental aspects for change to be successful is the motivation of employees to change. It reduces resistance to change and ensures greater buy-in from employees. However, it emerged from the data the researchers collected that people were not looking forward to the introduction of a PMS and that a PMS would not benefit them. Of the respondents, 74% indicated that employees were not committed to achieving the objectives of a PMS.

The study also considered the feelings of the employees about the change initiative. Most of the respondents indicated that they did not see the introduction of a PMS as fair to employees. The study found that most of the respondents had a negative perception of a PMS because they see the introduction of a PMS as an additional stress factor at work. Most also did not feel that a new PMS would be different from the previous unsuccessful efforts. The drawbacks and negative experiences of the previous system might have caused this situation.

The findings showed that employees did not have a clear understanding of the change process. In this context, Hale (2004) noted that employees should have a conceptual understanding of what a change initiative entails and how they can benefit from such a new system. Kok (2007) and Van Tonder (2004) echoed this view and contended that, without communication, change cannot happen and employees should understand that communication would enable them to see change as valid and relevant. Lorenzi and Riley (2000) contended that better communication about change initiatives in organisations would ensure continuous dialogue between managers, or supervisors, and subordinates. Werner and Asch (2007) and Kim (2009) supported this view and stated further that dialogue should be open, direct, and respectful, and should use shared change responsibility and new ideas as its basis.

It is clear from the data the researchers collected that employees lacked motivation and that this was because they lacked confidence in the leaders of the organisation. Thach and Thompson (2007), as well as Kelman (2005), emphasised a climate of trust between the leader and the rest of the team because trust brings hope for a better future and makes it much easier to cope with drastic change.

The data the researchers collected showed that the organisation did not encourage employees to make suggestions about introducing a new PMS. Amanto (2009) contended that the best way to involve employees in a change process is by empowering and encouraging them to share and provide new ideas and to make sure that organisations communicate the reasons for the changes well and that all member of groups understand them easily.

The literature the researchers reviewed emphasised the proper planning of the change process, the timing of the introduction, the commitment of employees and leaders as well as consideration of various business components like structure, culture, vision, strategy and mission (Leighton Holdings Limited, 2010; Sparrow, 2008; Su, Baird & Blair, 2009; Witcher & Chau, 2008). The researchers identified all of these factors as challenges in this study. They also regarded the period for making the change as unrealistic. It was also clear that the organisation had not planned the change initiative well.

The findings showed that employees did not receive training to cope with their new job requirements and that they would not cope with the increased job variety. The fear of some respondents (58%), who argued that people would not reach their potential after the organisation introduced the PMS, also supported this. This is quite possible given the absence of adequate training.

The researchers established that the participants were sceptical as to whether introducing a new PMS would improve relationships between staff members and their supervisors. Nelongo (2011) identified poor relationships as one of the main causes of poorly implemented performance management systems because peer groups, with their social structures, elicit more response from employees than the incentives and controls of managers do.

Because of the lack of knowledge and communication about performance management systems, organisations should manage their stakeholders and conduct a stakeholder impact analysis to address the concerns, challenges and assumptions of the stakeholders before introducing a PMS.

Organisations should develop communication strategies to ensure that the information they provide aligns with the project goals, organisational objectives as well as their visions and missions.

Organisations should indicate the success factors for introducing performance management systems and conduct workshops with the relevant stakeholders to give them, and those concerned with the change processes, a clear understanding of the visions, missions and strategies as well as the outcomes the change processes will achieve.

It is vital for organisations to build a case for change (CFC) for introducing performance management systems. It should be based on preparing the change visions, developing them and understanding the changes.

Organisations should allocate sufficient personnel to serve as change agents and develop them so that they can facilitate the change processes. They should conduct change impact assessments in order to identify risks and the effects of change on people and business, and subsequently develop action plans to manage the effects of change.

Organisations should develop leadership and build capacity to enable and encourage strong change leadership in order to ensure that line managers drive the change initiatives and that the most influential people in the organisations champion them.

Organisations should develop and implement workforce-transitioning plans. They would include identifying skill and competency gaps, training, education, competency feedback, results and developing continuity plans

The most important principles of successful change management and implementation are communication, involvement and inclusion. This means that people change when they understand the need for change, when they are involved in the process and when they are empowered.

The researchers found that the organisation was not ready to introduce a new PMS and that the employees had negative attitudes and feelings about a new PMS. There is no doubt that the employees were willing to be a part of the change process if the organisation had planned, managed and communicated it to ensure that all employees understood and bought into it.

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