Strategic Change Management - Models of Strategic Change - Essay Example

STRATEGIC CHANGEMANAGEMENT

Introduction

This paper covers the broad topic of strategic change management. Strategic change management is enhancing change with an aim to meet the organization's goals. Change is necessary to an organization. The change helps the organization thrive and compete with the other competitors in the industry. For this paper, ASDA is the case study company.

Task 1.1 Discuss models of strategic change

According to Charles Darwin, the species that withstands changes and is responsive to the change survives in any given environment (Todnem, 2005). Therefore, organizations should accept change or else they will become extinct in their business environment. An organization can use various change models to remain relevant in the marketplace.

ASDA can use the Kurt Lewis three-phase change model. According to the Kurt theory, an organization accepts universally. The theory uses a three-word concept that includes freeze, transition, and unfreeze (Aladwni, 2001). Moreover, the theory recognizes a company as a complex organization of people, process, and technologies whereby change affects all the three interrelating components (Helms, 2008). Nevertheless, this model assumes that there has to be a balance between the forces that resists change and the sources of change (Todnem, 2005). According to Lewis, change goes through three stages that include:

a. Unfreeze- Unfreezing is the first stage in this model. Individuals resist change with an active effort. However, to overcome the resistance a period of softening is required. This process becomes effective through motivation (Helfat et al, 2009).

b. Transition stage- This is the second stage in the model. After change commences, the entire organization moves in a transitional period that lasts for some time. Besides that, the leadership of the organization has to stand out, reassure all the stakeholders of success, and unite them during the transitional period (Zajac et al, 2000).

c. Refreeze- Refreezing is the final stage of the model. After the change has been enacted, implementation is complete. The organization becomes stable and the staff refreezes. They carry out their duties under new guidelines (Aladwni, 2001).

ASDA can adapt this model. This model is widely used and can be easily applied in ASDA area of business (Hammed, 2015). Nonetheless, it is easy to use, it consumes a considerable period to implement and therefore can be used where major changes are required (Grill, 2002). However, this model cannot assist ASDA where an agent change is required.

Similarly, ASDA can use McKinsey 7-S model to implement change. The model uses a holistic approach to enact change. The model has seven factors that work collectively to bring about change (Nag et al, 2005). The seven factors include structure, systems, style, staff, skills, and strategy (Helfat et al, 2009). The McKinney model provides the best method which helps to identify the source of change in an organization (Aladwni, 2001). All the same, strategic changes in this model help to identify technical guidance within the organization. Furthermore, the model combines both emotional and rational components of change (Thomson, 2010).

On the other hand, the McKinsey model does not consider differences during change (Todnem, 2005). Moreover, the model cause changes to all factors even if the change was to happen in one element. All the eight factors in McKinsey model experience change because they are interrelated. Besides that, the model is complex and hard to apply in ASDAs business environment (Hirschhorn, 2002).

ASDA can also use the Kotter 8 step model to bring change. The change model work under the principle whereby employees will accept changes if only the organizational heads convinces them the need for the changes (Zajac et al, 2000). The model is advantageous to ASDA because the process of implementing change is easy and the change occurs in stages (Aladwni, 2001). Additionally, the model helps the organization to focus on the changes that will come after the implementation (Hayas, 2014). The organization is able to accept and prepare for the changes (Grill, 2002). The transitional period is much easier and faster for the organization while using this model (Helfat et al, 2009).

The Kotter model is disadvantageous to the organization because no procedural step can be skipped and the process of acquiring change is long (Bruch et al, 2005). Additionally, the adjustment to change is the most difficult time for the employees and the organization (Hirschhorn, 2002). Therefore, any model that brings changes to the organization requires guideline changes.

1.2 Evaluate the relevance of models of strategic change to organizations in the current economy

The types of changes that ASDA goes through reflect on the factors that help in understanding the changes in the current economy and the relevant models for the strategic changes.

Subsystem

Involves the changes that occur due to the removal or addition of new product or services to the organization. Therefore, the implementation of the new process to ASDA complies with Lewis 3 step model. Nonetheless, the current economic conditions allow the use of the model.

Organization-wide

Organizational change is the change that occurs when the firm does a major restructuring. The change is applicable using the MacKinseys and Kotter change models. However, the change requires a lot of funding

Transformational

Transformational change revamps the entire organizational structure from top to bottom. The traditional structure change completely. The MacKinseys model is appropriate for performing this type of change. This change requires devolution of new skills. However, the transformational change is a revolutionary change; therefore, the organization will incur a huge expenditure cost.

Developmental

ASDA requires a direct connection with its customers. ASDA should develop their product gradually according to their demands and the success of the products. However, development change is complex and lies along with the Kotter's 8-step theory. Development change is also capital intensive.

Unplanned

Unplanned change tests the management because they are usually unpredicted. The Lewis model would be applicable because the changes require urgent measures. The change may be prompted by the resignation or death of officials.

Remedial

Remedial change helps to improve product performance. The change aims to enhance the performance of the organization. Remedial change is less costly compared to other types of change. The best model for this change would be Kurt Lewis model because the model focuses on change only.

Task 1.3 Assess the value of using strategic intervention techniques in organizations

A strategic intervention focuses on improving the organization’s position in the market (Bruch et al, 2005). The implementation of change aims at influencing an organization’s belief, values, attitudes, and culture that match with the current business structure (Todnem, 2005). Moreover, strategic intervention helps to facilitate change within the business environment. Change interventions are usually unique for each organization (Helfat et al, 2009).

Task 2.1 Examine the need for strategic change in an organization

A recent sample of ASDA beef burger contained a 12 percent of mutton meat. Stakeholders felt that the organization had let its customers down by selling them the wrong product. An urgent change was imperative at ASDA as the organization promised to eradicate the problem. To prevent further damage all the products from the supplier should be withdrawn from sales (Heuy, 2001). Moreover, the change also prepares the staff who e involved in the elimination process. More to the point is that to counter the bad reputation there is the need for change (Thomson, 2010).

Task 2.2 Assess the factors that are driving the need for strategic change in an organization

The driving factors of change in ASDA have analyzed using the PEST analysis.

Political factor

During a session in parliament, David Cameroon the prime minister indirectly condemned the food situation and termed it as an unacceptable state of affairs (Bruch et al, 2005). Nonetheless, he gave a directive to the Food Agency to take action to food companies giving false information to their customers (Zajac et al, 2000). Therefore, ASDA should take the necessary legal changes regarding the issue (Hirschhorn, 2002).

Economic factors

The current issue has given ASDA a bad reputation (Thomson, 2010). Nonetheless, the organization needs to redeem itself. Moreover, the situation at hand has lowered the company’s sales. Therefore, the managerial activities require changes. The organization needs to establish a crisis team to check on the financial issues (Helfat et al, 2009). Besides that, the company’s shares have dropped significantly in the stock market that means the company is not doing well (Bai and Peron, 2003).

Social Factors

The customer loyalty towards the company has taken a negative impression. Nonetheless, the society has a vital role of providing a market for the company’s products (Aladwni, 2001). If ASDA losses its customers the effects within the organization will have long-term and short-term effects. However, ASDA needs to compensate the affected members of the society. Nonetheless, the Company requires a strategic change for its marketing department (Todnem, 2005).

Technological factor

ASDA is among the large companies that are doing well in the industry. The firm makes most of its profit on the online sales (Thomson, 2010). Therefore, ASDA needs to equip itself the latest technologic changes in the industry (Bai and Peron, 2003). The changes that ASDA make should help the organization coup with fast changing technology (Grill, 2002).

Task 2.3 Assess the resource implications of the organization not responding to strategic change

The market share for ASDA is 17.6% more than that for TESCO a rival firm (Bruch et al, 2005). Nonetheless, to increase the market share ASDA is required to develop its products and make them available to customers by increasing the small shops owned by the company. Therefore, with this regard, the resource implication will increase financial resources, physical resources redundancies, and the establishment of new buildings and refurbishment of the resources more frequently (Aladwni, 2001).

Task 3.1 develop systems to involve stakeholders in the planning of change

Generally, three major stakeholders are involved in the planning of change. Internal stakeholders, they include the staff, workers, and managers (Thomson, 2010). Likewise, the other stakeholders include the external stakeholders who include the customers, the government, and other organizations (Todnem, 2005). Similarly, the other stakeholders are the connected type of stakeholders. They include suppliers and shareholders. The following graph shows the plan for change among shareholders.

Figure 2: stage involved by stakeholders in the change process.

In the graph above the internal shareholders for ASDA are involved in the change planning in the preparation phase. They are aware of the possible change that the organization is likely to undertake (Grill, 2002). However, the degree of involvement of ASDA external shareholders is dictated by time. In the early stage of the change, Stakeholders are not aware of the change. Nonetheless, during the commitment phase, the change is usually has been utilizing fully, whereby the stakeholders and the sellers are involved in the commitment thresh hold in enacting the change (Todnem, 2005). However, it is important to note that the above representation is an overall framework whereby stakeholders are involved in the change planning system(Aladwni, 2001). For that reason, the extent to which stakeholders are involved in the planning system depends on the nature of the employed change.(Zajac et al, 2000)

Task 3.2 Develop a change management strategy with stakeholders

An organization changes dependents on the power of each division of shareholders (Hammed, 2015). However, the interest of the shareholder matters to the changes enacted in the organization. As a general, rule the organization deals with the stakeholders based on interest as indicated by the diagram below.

Task 3.3 Evaluate the systems used to involve stakeholders in the planning of change

The figure above indicates that ADSA stakeholders’ have a high level of interest and a high power towards change. Therefore, the changing incentive among stakeholders monitors their interrelations closely (Zajac et al, 2000). The stakeholders include the employees and the shareholders. Similarly, the low-level interested stakeholders like customers needs have to be meet by the company’s management.

However, the other low powered but high-interest stakeholders are suppliers who have to be informed about the progressing changes through the existing communication channels (Nag et al, 2005). The public has a low power and have a low interest to the changes that occur within ADSA. The public monitor the change using minimal efforts

Task 3.4 Create a strategy for managing resistance to change

Education and communication assist in managing resistance (Nag et al, 2005). Communicating and educating employee’s helps, they understand the logic behind the changes (Thomson, 2010). Therefore, incorrect rumors concerning the changes within the organization will have no effects on the changes within the organization (Grill, 2002). On the other hand, the other strategy method that manages resistance is facilitation and support. Organizational managers can reduce resistance by being supportive to employees during the difficult times (Nag et al, 2005). The managerial assistances help employees handle fears and anxiety during the transitional period (Zajac et al, 2000).

Task 4.1 Develop appropriate models for change

ASDA can also use the Kotter 8 step model to bring change. The change model works under the principle whereby employees accept changes if only the organizational heads convinces them the need for the changes (Aladwni, 2001). The model is advantageous to ASDA because the process of implementing change is easy and the change occurs in stages (Thomson, 2010).

Additionally, the model helps the organization to focus on the changes that will come thereafter after the implementation (Todnem, 2005). The organization is able to accept and prepare for the change. However, the transitional period is much easier and faster for the organization while using this model (Bai and Peron, 2003).

Alternatively, the Kotter model disadvantageous to the organization because no procedural step can be skipped, the process of acquiring change is long (Helfat et al, 2009).Nonetheless the adjustment to change for an organization is the most difficult time for the employees and the organization (Bruch et al, 2005). Therefore, any model that brings changes to the organization follows the model guidelines.

Task 4.2 Plan to implement a model for change

When faced with a critical situation ASDA should take the immediate action against the issue. The management teams should choose the most suitable model that handles the issue appropriately (Grill, 2002). While using Kotter 8 step model. The first step includes creating urgency on the issue. Step 2 involves the formation of powerful coalition whereby ASDA is able to convince its stakeholders of the necessary changes(Hirschhorn, 2002). Step 3 of the implementation model would include creating a vision of change whereby ASDA helps individuals to understand the reason as to why they are taking the changes(Thomson, 2010).

Step four in the model implementation for change ASDA should communicate the vision carried by the changes (Todnem, 2005). Step 5 should eliminate the obstacle that might hinder the change process (Hayas, 2014). Step 6 should create the short-term wins that ASDA needs to accomplish after accomplishing the changes. Step seven ASDA should build on the changes. The firm should look forward to improving on the changes. Step eight aims at anchoring the changes in the cooperate culture.