Drivers of Resistance to Change: A Case Study of A Negotiated Budgetary Process

This study aims to explore more in detail the micro-level mechanisms involved in this process addressing three research questions: what is the role played by information asymmetry and subjects’ resistance to change their initial budget proposal? What is going to happen if managers are negotiating also for a group of low level managers and not only for themselves? And, what is the role of managers’ participation and how it has been implemented to facilitate the information exchanges in the negotiation phase? Cognitive psychology is used as theoretical foundation -considering cognitive dissonance theory, the psychological role of commitment, the processes linked to the ‘confirmatory bias’, and subjects’ resistance to change studies. The research design is a single case study on an Italian subsidiary of a multinational company. Data were collected with a multi-method approach using interviews, questionnaires, archival data and direct observation.Findings indicate the positive role of information asymmetry and managers participation as drivers reducing managers’ resistance to change their initial budget proposal, and, instead, the existence of an increasing degree of managers’ resistance to change when (1) they have chosen the proposal with which the negotiation begins, (2) they have a high level of commitment to their chosen proposal and (3) they are called to negotiate also for a group of low level managers and not only for themselves. Moreover, also the use of an information tool that allows managers’ to reason in an iterative way in the targets’ negotiation phase has a positive role for reducing their resistance to change the proposal.