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Organizational Change and Kotter's 8-Step Approach

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Think of an organization you have worked for or one with which you are very familiar. Diagnose the need for change and present a plan to transform the organization, utilizing Kotter's 8-Step Approach.

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The expert examines organizational change and Kotter's 8-step approach

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Organizational change is required when either newer internal processes or training will improve the business organization - to being more efficient within the targeted industry. Let's take a look at an example organization, such as the healthcare industry. In particular, the healthcare insurance company provides coverage for their subscribers when medical assistance is needed and recruits physicians to being included in the provider network.

The scenario issue relates to the healthcare insurance company processing claims where the majority of claims end up being overpaid. The physician has to take time away from serving his / her patients to balancing their accounting to sending back the over payment. The physician is not aware to which department to send the over payment, thus, the unknown reason for the over payment is sent to the healthcare insurance company. An onset of numerous over payments coming into the healthcare insurance company creates a need for a new separate department within the accounting unit - to processing unknown over payments.

Upon review, the healthcare insurance company designated employees to working on the unknown over payments and discovers that a variety of reasons are associated with such over payments. The management team at the healthcare insurance company decides to make major changes for reducing the amount of unknown over payments that slows down productivity to processing claims by the right matrix and paying physicians accurately. Change in claim processing is imperative to reducing refunds to physicians, refunding patients, and restrict healthcare insurance agents to not over-quote contractual payouts.

In the Kotter 8 critical steps to success, the following is accessed in assuring the new changed processes are accepted, enforced, and implemented accordingly.

1. Establishing a sense of urgency
At last audit, the healthcare insurance company accounted for 4,000 healthcare claims being overpaid to providers at 85% with over payments to patients at 15% in a month. The onset of continuing such over payments will present excessive operations costs and brand identity value reduction due to poor quality in healthcare claims processing. Thus, the sense of urgency is changing the internal healthcare claims processor in processing every claim with quality metrics and checkpoints before any checks are sent out. Further, the healthcare insurance sales agent must revisit processes when signing up providers for inclusion into the network with current payout rates on services.

2. Forming a powerful guiding coalition
Initially, the healthcare insurance company senior management will need to focus on getting many supporters on board to the change. The internal meetings with supervisors aim towards creating a solid front concerning both claims processors and insurance agent sales personnel need for revamping the company's processing procedures. When change management is implemented, the first phase is setting up a supportive team in every outlet that will be directly or indirectly impacted after the change. In doing so, the business operation will have a higher return of employee acceptance to the change of processes that will benefit all departments and entities.

The senior management team with the cause of urgency to the sub-departments leadership will present statistical ...

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  • MBA, American Intercontinental University
  • PhD (IP), Grand Canyon University
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