Change Management Scenario - Assignment Example

Change Management Scenario In the year 2009, Quinn Corporation established a new store in Japan accomplishing one of its missions (increasing its international market share) in the competitive international market. The company acquired one of the stores that dealt with the same products as one of its areas of operation. The store, before acquisition was Nakamura store. Nakamura store dealt with the sale of beverage, food, clothing and mobile products and Quinn is a multinational company that deals with food, beverage, clothing, home products, mobiles, fuels, banking services and so many others. This company has expanded to different regions in the world. Each company of Quinn Corporation has to have departmental managers who report to the general manager who in turn reports to the head office of the organization. One of Quinn Corporation’s strategies of expansion is acquisition of smaller companies that can help them achieve their aims. The company conducted a study in Japan and analysed the market and found out that it would be a very good market for their products. The company management team could not find an easier way of expanding its food, beverage, clothing and mobile section’s operations in the country except for acquisition of already established companies. Nakamura store is a small company owned by Ansen Nakamura. He dealt with his employees so freely. The employees were free to think of ideas and tell him during staff meetings. They considered him a good leader and a friend. Ansen Nakamura was the general manager of the organization and every department head reported to him. After the acquisition, a new manager was brought from the acquiring company’s headquarters to take over the management of the company. The new manager (let us name him Oliver) was to implement Quinn Corporation’s values, culture and strategies into the newly acquired business. He however was to consider the culture of the people around in the management of the business. Oliver was a strict manager who gave orders and the assignments to be done. He only received reports from the department managers, which he analysed, made changes that he thought were appropriate or made suggestions and reported his progress to the head office. Little did he know that the employees of the company were not happy with his management style. The employees started complaining to their heads about being considered useless in the company. Since the departmental managers were afraid of him, they could not tell him of the employees’ complaints. One of them however managed to contact the head office about the situation in the branch and Oliver was summoned to the head office. Two days after returning from the head office, Oliver was furious. He held a meeting and told the employees to never undermine his position again. He told the employees to report to him and not the head office. He added that if he heard of any report from above about him, the person responsible would be fired. The employees left the meeting with most of them contemplating resigning. 1. Leadership approaches during the change process. The first leadership approach employed in the scenario is the transactional leadership approach (Syque, 2010). A leader is one who inspires others towards a direction. He or she develops a vision of the future, aligns people through inspiration and communication and ensures that missions of the vision are accomplished (Mullins, 2007). He/she leads the way. A leader therefore has followers. According to Babou leadership is the relationship between the leader and the followers and for the relationship to be built, the personal values and efforts of the followers has to be appreciated (2008). Different leaders have different ways of dealing with their followers. Leaders can choose to be transformational, charismatic, transactional or even visionary. This depends on ones personalities, values and the situations in the organization. In the above scenario, the type of organization that has acquired the small firm has played a part in the leadership style that Oliver has taken. Quinn Corporation has a clear chain of command which the leaders have to follow. One of the assumptions of transactional leadership approach is that the social systems work best with a defined chain of command. Additionally, the manager tells his employees that those who will not acknowledge his position and role as a manager by reporting matters to the head office will be sacked. According to information from Syque, transactional leadership assumes that; people are motivated by punishment or reward, the main purpose of the employee is to do what the manager tells them and that after signing a contract to do a job, part of the contract is to give up all authority to the manager (2010). From the above scenario, it is clear that the manager is a transactional leader. He gives directions to be followed, believes all authority has been given to him and threatens to fire employees for disrespect of his position. This approach to leadership is not effective considering the feelings the employees have already developed. They feel less important in the company unlike before when they were considered in the decision making process. Employees should feel motivated to improve the productivity and performance of an organization (model 7). The manager should recognize that the small company had different values, culture and management and employ a different approach to leadership that helps the organization achieve its aims and does not destroy the management system of Quinn Corporation. A transformational leadership approach combined with transactional leadership would be appropriate. This will ensure the inspiration and encouragement of employees while maintaining the organization’s chain of command and systems (model 7). 2. Change Management Strategies Utilized in the Change Management Process: So many issues cause change in the organization. The change in the management procedures is change in an organization, the change in the economy can cause change in the organization and the employment of a new CEO can also cause change in the organization. In most cases it is the external factors that cause change in the organization. In the case above, the type of change that has occurred is a planned subsystem change (Authenticity Consulting LLC, 2010). Quinn Corporation has identified a new market for some of its products and has acquired a small company to increase the global operations. It can also be considered as an incremental change (Authenticity Consulting LLC, 2010). Change management strategies depend on the aim of the organization and the situation in the market or in the organization (Hiatt & Creasey, 2003). In the above scenario, the strategy used in the company’s subsystem change is acquisition of a small company. The company’s aim was to expand its business to other countries. One of the ways in which Quinn ensures its operations expand to the outside world is through acquisitions. The strategy is appropriate but there are some important factors to be considered when managing such acquired companies. One is the culture of the acquired company. The previous manager had developed a laissez faire culture with the employees. The new manager however, did not consider that and the employees had started to complain. Change management considers how the human resource will help the company achieve its aims (Hiatt & Creasey, 2003). The form of leadership taken to manage the employees only motivates the employees when they are rewarded. It however does not inspire them to work towards organizational goals. This may affect the performance of the organization after some time. An organization’s change management strategy may be considered appropriate but when some important factors are ignored, the strategy may not prove to be effective. The values and culture of the acquired company should be analysed before implementing new change management strategies (Hiatt & Creasey, 2003). This is the case with the above change management strategy. The organization wanted to expand to a different region and acquired a small company. This means that Nakamura store would undergo change considering the values of the new company, but in order to effectively manage the new company, Oliver has to know what values and culture the Nakamura store had developed, to determine if they will still be effective in achieving the aims of the newly formed organization or not. 3. Power and Politics Issues Power bases that the leaders have used as evident in the scenario are; coercive power and legitimate power. Coercive power is when the leader instils fear to his/her employees (McKenna, 2000). When a leader applies or threatens to apply physical sanctions such as control of basic needs, infliction of pain, frustration through restriction of movement and so many others, such a leader is known to use coercive power over the person to whom he/she is applying it to (McKenna, 2000 & module 8). A leader also has coercive power over a group of people if he/she can suspend, demote or dismiss an individual assuming that the person values the job (McKenna, 2000 & module 8). Additionally, if a leader can assign duties to employees that the employees do not find pleasing or find embarrassing or feel mistreated by it, then such a leader has coercive power over the employees (module 8). In the scenario, Oliver had coercive power over the department managers and other employees. According to the information from the scenario, the departmental managers were given directions on what to do without questioning and the employees were threatened that they would be fired if they did not do what the manager wanted. Legitimate power is possessed due to an organization’s structural position. In the scenario, legitimate power is shown in Oliver’s position as a manager and the head office role. The head office managers and Oliver also possess coercive and reward powers in their respective positions (McKenna, 2000 & module 8). Managerial power issues: A manager has coercive, reward, legitimate, knowledge and so many sources of power as discussed in Lundberg (2008). The use of these powers however matter and sometimes results in conflicts if not well used. In the above scenario, there is misunderstanding due to the manager’s use of power. A manager always has the power to promote, to hire or even fire (Lundberg, 2008). The manager in the scenario used his power to threaten the employees. Another issue in managerial powers is the use of power with consent. One should not just use coercion to achieve compliance; instead, a manager should focus on the use of his/her power and influence to achieve commitment among employees (Hales, 2001). In the scenario, it is not clear whether the manager aimed at achieving commitment or not. It seems the manager was more concerned about respect to his position than what the employees feel. The employees now show partial commitment with some of them contemplating resignation. 4. Conflict Issues in the Change Process: Conflict arises when two or more people have contradictory values, perspectives or opinions about something or an idea (PPC, 2005). Conflict management process requires identification of the causes of the conflict, knowledge of who is affected and how, identification of the intentions of the parties affected and their behaviours in the end. With this kind of knowledge, a manager can easily resolve conflicts (Culbertson, 2010). In the scenario, the conflict was between the manager (Oliver) and the employees who had value differences. The employees felt that the manager never appreciated their efforts and never communicated with them. The department managers also had different values considering how the employees were being treated. The manager instilled fear in the employees which led to one manager reporting the matter to the head office. The approach taken by the head office in handling the conflict between the manager and the employees was to talk to the manager alone. Considering conflict management process, it is important to first determine where the problem lies before a conflict is resolved. Conflict resolution should have involved views/complaints from both parties and decision made from a meeting involving the two parties under conflict (Culbertson, 2010). There are several approaches that can be used in conflict resolution. These are; collaboration where every party wins and is helped in achieving their goals, accommodation, where one party accepts to lose for the sake of important values, compromising where each party accepts to lose some and win some, competition where the two parties are set to compete and the result resolves the conflict and avoidance where the case is left unresolved so that both parties lose (Culbertson, 2010). In the scenario, the approach used in resolving the issue is one sided. It is only the manager (Oliver) that was summoned to the head office with no evidence of what he was told. For the benefit of the organization, a better approach should have been used. With such kind of action, no conflict was resolved since the leader was still considered right in his actions while the employees considered him wrong. In the scenario, the manager should have accommodated the complaints and changed his style of leadership than threaten the employees or the head office should have involved both parties in resolving the issue. The head office should have considered both parties winning, both parties losing and both parties losing partially and winning partially. With this approach the employees would not have ended up feeling rejected and less important. 5. The role of the Organisation’s Culture and Design in the Change Process The culture element evident in the scenario is the organizational value. Organizational values are always portrayed by shared people feelings, understandings, shared behaviours and shared actions (Cameron & Quinn, 2005). It is clear from the scenario that the organization does not take into consideration, what value the employees are to the organization. The employees show that they are not valued when they complain about the manager only communicating to the department managers and not them. This means that the efforts of the employees are not appreciated or the organization is not just concerned about its employees. The values developed and maintained in an organization forms the culture of the organization (module 10). The culture that the manager is trying to build is that of employees working in fear. That is a culture where the employees are just there to listen and not to participate in active decision making. It is also a culture where the employees are there to do what they are told with no goals or objectives to inspire them. This kind of culture does not support any form of change in an organization. The human resource forms one of the most important resources in organizational management, especially change management. Without good management of this resource, change management is not easy (Alvesson & Sveningsson, 2007). A culture where people are valued for their efforts, and the organization is valued and appreciated should have been built (Alvesson & Sveningsson, 2007). If one appreciates the value of the organization, it is not easy to just decide to resign any time. A culture of appreciation and value should be created in the newly formed Quinn Corporation store. This will also help in reducing the conflicts. Organizational design has a role in supporting the change. Organizational design /structure show how jobs are done to accomplish the missions of the organization (module 11). In the scenario, the design is determined by the already established chain of command. Each company has to have its manager who reports to the head office. Quinn Corporation never altered the design of the organization. Nakamura store had a managerial position which managed the whole organization. The design only changed because the new manager reported to a head office. This supports change management since the structure was not different from that implemented by Quinn Corporation in its business and is the same structure used to manage the previous store hence ease of delegation of duties and management. Conclusion: From this analysis, it is very clear that change management requires a good leader. A good leader in this case does not mean a leader with the ability to manage the organization only; the leader should have a lot of qualities. The leader should be able to analyse the situation in which the organization is in and develop strategies that can make the organization perform well or stay competitive irrespective of the situation. The leader should be able to recognize what is needed by the organization, in the right place and at the right time. In the case described above, if the leader could analyse the values and the previous culture of Nakamura store, he would have established the appropriate approaches to use on the organization’s employees. He would also know how to use his powers to control the operations of the company, and would have known what measure is important in a specific case, for example in conflict management, hence gaining control of the organization. Furthermore, he would know what to do to merge the cultures without conflict and would even know when to initiate change if necessary. Good management is all about leadership. The leader influences the values the organization and its employees would adopt. The leader therefore plays a very important role in organizational change management. This does not mean that other people involved in organizational management in one way or the other do not have roles in change management. The human resource is very important in change management. It influences the organizational culture, the values the organization will have and its performance. Though they receive instructions from leaders, their compliance and commitment is very important for the organization. Some of the factors that influence how organizational change management is carried out are dependent on each other. The leader is dependent on organizational resources apart from his/her abilities and powers, the employees depend on the leader and organizational resources and the culture developed in an organization is dependent on the employees and the leader. Organizational change management requires the management of all the factors that affect or contribute to organizational performance. Performance in this case depends on the aims of the organization, for example, remaining competitive in the market, making profits, increasing market share, and expanding to other markets. It requires analysis, identification of what is important for organization’s progress towards a specific aim, planning, implementation and review of performance of developed strategies to ensure efficiency. List of References: Alvesson, M & Sveningsson, S 2007, Changing organizational culture: cultural change work in progress, Routledge, London, UK. Authenticity Consulting, LLC, 2010, Major Types of Organizational Change, 22edn, viewed 21 May 2010, . Babou, 2008, Leader – Member Exchange (LMX) Theory, viewed 23rd May 2010, . Cameron, KS & Quinn, RE 2005, Diagnosing and changing organizational culture: Based on the Competing Values Framework, John Wiley and Sons, San Francisco. Culbertson, H 2010, Conflict Management Strategies and Styles, viewed on 23rd May 2010 . Hales, C 2001, Managing through Organisation: the Management Process, Forms of Organization, and the Work of Managers, 2nd edn, Cengage Learning EMEA, Hampshire, UK. Hiatt, J & Creasey, TJ 2003, Change management: The people side of change, Loveland, Prosci, Colorado. Lundberg, J 2008, What are the sources of Managerial power?, viewed 21st May 2010 . McKenna, MF 2000, Business Psychology and Organizational Behaviour: A Student's Handbook, 3rd edn, Psychology Press, East Sussex, UK. Miner, JB 2007, Organizational Behaviour: From Theory to Practice, M.E Sharpe, Armonk, New York. Mullins, LJ 2007, Management and Organizational Behaviour, 8th edn, Financial Times Prentice Hall, Upper Saddle River, New Jersey. People Partnerships and Communities (PPC), 2005, Conflict Management, viewed 23rd May 2010, . Syque, 2010, Changing Minds.Org, Transactional Leadership, viewed on 24 May 2010, . Read More