Exploring Strategic Change - Assignment Example

STRATEGY: CHOICES AND CHANGE Introduction The report relies on a case study of Ascension plc Company; Transport Engineering Division (TED) to carry out the strategic analysis within the organization. The aim of the report is to explore several aspects of changes that had occurred between 2012 and 2014. TEDs creation in 1994 was the privatization of UK railway system. More often, it handles track and signaling maintenance as well as larger transport engineering construction projects (Cameron, 2015). The case study critically examined the reforms that were carried out in TED when it was almost closed down or sold due to financial constraints. The company began to face very tragic problem in 2012 since it started engaging in colossal projects that were unmanageable by its systems and processes leading to higher risks of closure (Cameron, 2015). Immediate change that occurred in late 2012 rescued the company and this included terminating the contract of the then chief executive officer among other minor amendments that took place. In the analysis of the strategic change process, Balogun and Hope Hailey’s Change Kaleidoscope model and Lewin’s Forcefield Analysis was taken into consideration as a change impact (Krogerus, 2013). Johnson’s Cultural Web model and Kotter’s 8 Change Steps model were the other two analytical tools used to analyse the internal features and measure the change in Ascension plc (TED). Hope-Hailey and Balogun’s Change Kaleidoscope Model The model was developed to pull together and systematically arrange a wide range of related features and implementation options that require consideration during the transition. The tool is used in gestating the character of change. The model uses a comprehensive framework that captures all the significant factors as deemed by the instigator. The model discovers the features entailed in a change model; these features are categorized in rings that can spur change, inhibit change or implement change (Norland, 2006). The implementer should therefore comprehend the appropriate features of change to enable them make sound judgment in a particular context. The change kaleidoscope contains eight features: Time: This dictates the urgency of change in the organisation. The instigator should be concerned with adopting long-term strategic change needed to affect part or the whole organisation. Scope: A clear line should be drawn to determine the extent of change in the setup. The change can either affect part or the whole organisation. Preservation: The change should define the organisational assets and practises that must be retained during the change. Diversity: The change should consider the different staff within the organisation. Change should be homogenous and protect the values of each staff. Capability: The different organisational capabilities should be checked before implementing a change model. The need to improve the capability should be evaluated before the change process. Capacity: The organisation should estimate the level of resources needed to invest in the planned change process. Readiness for change: The employees should be ready for the proposed change process within the organisation and be stimulated to bring the change. It was mentioned that in order for a change model to be effective, it must be used together with other models and frameworks. Change kaleidoscope - TDK Fig 1.0: Change Kaleidoscope of Ascension plc, TED (Adapted from J. Balogun and V. Hope-Hailey) Time TED strategic change timeline was chosen as three years. The main change agent was Jack Warner who had a limited autonomy leadership style. Jack Warner can be identified as the enabler of change because his introduction spurred a turnover of £160 million. Scope One of the strategies used in implementing the much-needed change was reducing the size of staff by half. This was a strategy that was devised to maximize productivity using limited resources as well as reducing the running cost of the new company (Biech, 2007). The other scope was to improve the quality of service to the customers in order to boost market confidence. The strategy was aimed at optimizing revenue by attracting more customers, therefore acting as an enabler of change. Diversity One of the ways of breathing fresh energy to the collapsing business was investing in different skills at all management levels. The move was geared towards pooling different ideas and implementing the new proposals in the system. The previous management lacked skill in charge thus it was difficult to discover new approaches for implementing the much-required change. Capacity and Readiness The first initiative towards realizing change was mixing people of different reflection of the change (Sabri, 2007). Those who supported change were mixed with those who did not support change and the result was a homogenous thought model that shaped out the ideological differences. The method was fundamental in accommodating all the opinions from all the groups regarding change, therefore, a positive result was achieved in TED. Lewin’s Force Field Analysis The model emphasizes the equilibrium between forces desirable for change and those repelling it. The concept evolved around the presence of a quasi-stationary social balance. Change can only happen when the status quo or balance is upset by adding favourable settings or reducing the repelling forces (Norland, 2006). The model expresses the idea that there is a compelling force towards change in every person and there is a restraining force that resists the change. Successful change can only be achieved by weakening the resistant forces or strengthening the driving forces. The force field analysis incorporates the three-stage theory of change used to expose the existing equilibrium. The new stability should resist further change at the new level. The model is used to distinguish the promoting and inhibiting forces responsible for the change at a personal level. The results are critical in making informed decisions that will be receptive to change (Krogerus, 2013). It is important to understand the emotional intelligence of people in order to evaluate their responsiveness to change. Force Field Analysis management tool was used to evaluate the impact of all forces that influenced the change in Ascension plc Company. The forces were into two; driving the force and restraining force. Driving force hugely promoted and pushed for the transformation of the company whereas the other force made a change to be very difficult (Martin, 2005). Force Field Analysis Driving Factors Score Restraining Factors Score Positive forces 3 Negative forces 3 Cost saving required 4 Management structure 4 Improved operational efficiency 3 Staff’s traditional mindset 4 Change supported 3 Fear of the impact of change 4 Customers expectation 4 Bureaucracy 3 Diversity growth 3 Slow to change 3 Quality service 3 Organisational process 2 Unsustainable cost 2 Political intervention 2 Future vision 4 No perception to save money 3 Conservative staff 3 Total score 29 Total score 31 Table 1-0: Lewin Force Field Analysis of Ascension plc Company (TED) From the table above, observation can be made on factors against and for the change. In the case study, the initial management team just preferred being very conservative with an old mindset that couldnt give room for any positive change. For instance, the effect had a drastic impact on the company’s growth agenda (Martin, 2005). The change was however triggered by top level management with improved customer relation trough provision of quality services. This change rescued the company since the new appointed CEO helped revive the customers attitude that had been severely damaged by the companys approach to ignore the client. Trust between the employees and employer also built up as the change progressed (Cameron, 2015). When restraint factor took into consideration, employees had a very high fear. As a result, that the so called changed couldnt have provided any benefit to them. Others are the preferred thinking on the company’s usual way of carrying its obligations. Also, was the reduction of top managing staff by half and restructuring of the organization’s structure lead to a lot of positive results, as it improved working method and the employees thinking criteria towards change. And given the very short duration, the change majorly focused on rapid turnover, return to profitability and long-term growth of the company. The instance resulted in the change program to be named Future first. The organization seriously had to realign its top management that was the primary enemy of change. Also, teamwork and customer relations had to be improved to sustain the company’s strategic growth goals. Change Kaleidoscope model analysis had been employed to help bring together different features and implementation options that had to be during the transformation. In the event, a change program was quickly developed by the name “future first”, the program kicked off immediately in January 2013. (Norland, 2006). In TED’s case, there were a number of changes made and at that time the major challenge was purely management problem. The change kaleidoscope considered eight major features with the centered ring containing the design options for implementation. The other layers of rings contained elements of change that can allow or block change. (Norland, 2006). From figure 1.0, it can be observed that changed kaleidoscope in the analysis of change process in Ascension plc Company. The major priority was to improve the company’s relations with customers (Cameron, 2015). The instances lead to the development of a three-year plan consisting of three major phases. From the above figure the word future first which described the transformation process in TED for a rapid turnout, return to profitability and long-term growth. An observation can be made from the above figure that given a short period of three years, the turnover experienced was above £160 million. Neutral Change For instance, the new management team mostly emphasized in increasing the number of customers by offering the quality services and incorporating their views and listening to their issues (Cameron, 2015). The peoples mindset was changed by investing on the employees skills that enabled them cope with the new systems. There were no cases of rigidity to work since the employees were allowed to form a team of members who set a plan. The impact of change was managed by high skilled employees with a task of proper research on the set goals which were later reviewed to produce a business plan. Inhibitor of Change The main inhibitor of change was the lack of teamwork at different managerial level in the organisation. Knowledge could therefore not flow freely as required to effect change in various departments. Despite the time limit, a real turnover could still be realized. The knowledge, teamwork, and free interaction of employees and senior managers played a significant role in change realization. Initially, employees rejected change due to lack of experience which made them have a negative attitude that change could not be of any importance. Johnson’s Cultural Web model The internal features of Ascension plc Company (TED) were with the help of Johnsons Cultural Web Model before the change (2012) and after the change (2014). Table 2-0 Johnson’s Cultural Web Model before the change (2012) and after the change (2013). Stories culture of TED before the change (2012) After the change (2014). Symbols Costs badly monitored & lack of accountability High accountability Rituals/Routines Managers couldn’t cope with new systems Managers quickly deal with new ideas Power Staff motivation paralyzed Staff motivated Structure Minimal cooperation from senior managers Maximum cooperation from senior managers Controls Bad relations with customers Excellent relationship with customers Paradigm Very little sharing of ideas Teamwork that involves sharing of ideas Lack of trust High level of trust Project staff avoided Project staff fully involved From the table above, positive changes can be observed in the management criteria which heavily contributed to the company’s success. Jack Warner entry into the top management position succeeded in getting the employees commitment, trust, and teamwork and customers right relation (Krogerus, 2013). As a result, it enabled the organization to pick steadily up down from 2012 when it closed down. Before the change, TED couldnt consider the right or wrong due to very enormous and complicated management structure. Nobody sought employee’s ideas as they were found to be less essential to the company’s development goals. However, immediately after the change, top management began to understand the problems and the specific actions. Thorough consultation with all the key stakeholders, they managed to reach a consensus with the junior and the senior staffs (Cameron, 2012). The symbol of change after Jack Warner assumed to the top position was characterised by high accountability in the system. The approach quickly spawned new ideas from staff and stimulated the managers to rapidly deal with the new ideas. The new system came along with high trust that promoted teamwork in the organisation. The teamwork led to sharing of ideas, improving the customer relationship with the organisation. Before the change, the table explains that there was minimal cooperation from senior managers, leading to inharmonious operation of the organisation. The first change involved reducing the number of (non-performing) staff that were also a hindrance to the much-needed change. Another major surgery involved changing the perception of the staff towards change. The intention was to guide them through accepting change as part of restructuring and achieving the organisation’s goals. Kotter’s 8 Change Steps Model During the year 2013-14, the top leadership of TED sat with the key stakeholders to discuss the primary problems the company faced and some actions. There were critical issues after which they were reviewed and agreed upon by the senior management. Change program immediately kicked off in January 2013 where a three-year plan was drafted consisting of three major phases as follows: Phase 1: a six-month rapid turnover Step 2: 6-18 month return to profitability Phase 3: long time growth of the company The instance resulted in a proper face to face conversation to everyone just to be frank with the major problems the company was facing and what change. Following this detailed conversation, eight clear goals that could make an impact were then set, reviewed and later adopted (Cameron, 2015). The management then came up with a business plan distributed to all the employees and the customers containing the key challenges and the set priorities. Size of TED senior management staff reduced to half and the companys entire management structure brought down to supervisory level. The company became employee lead and also integrated a series of project management training events with much better coordination, ownership, and accountability. When compared to the eight-step change process introduced by John Kotter, the company fully followed all the steps. (Sabri, 2007). Figure 2-0 Kotter’s 8 Change Steps Model From figure 2-0 and above, TED similarly followed the given stages as per the requirement by Kotters 8 Change Step Model. For instance, step one required the company to create a sense of emergency by ensuring that the key stakeholders involved in raising up an alarm. The alarm was on the issues that could certainly lead to the companys downfall. For step 2, the company built one team critical and worked as a family to ensure collaborative change. A strategic vision also was in place by the creation of a three-year plan that consisted of three major phases. Also, eight goals were put in place that made the company achieve a positive impact, and the change was majorly spearheaded by the employees and other stakeholders thus satisfying the fourth step. (Sabri, 2007). Step 1: Creating a sense of urgency. After performance evaluation of the organisation, it was discovered that the profit margin had plunged deep. Therefore, it was necessary to revamp change strategies that would increase the profit margin. Step 2: Build a Guiding Coalition for the benefits of change. Step 3: Start strategic vision and initiatives. Some of the initiatives implemented by the company included sourcing for a pool of different professionals at all managerial levels to help in idea sharing. The other initiative was to promote team building in the reenergized staff. Step 4: Enlist a volunteer army. The step was aimed at motivating staff and eliminating negative perceptions that were a hindrance to change in the organisation. Step 5: Enable Action by Removing. As was discussed before, the initial implementation stages involved restructuring the company. The new employees had a renewed change model that aided in propelling the company back to its former glory. Step 6: Generate Short-Term Wins. In order to realize the impact of change, it was necessary to start with analysing and appreciating the short-term achievements. They involved renewed customer confidence that was depicted in the sales outcome. Step 7: Sustain Acceleration. The new management employed measures that increased shareholder portfolio to sustain growth. The new customer relations were maintained to sustain growth. Step 8: Institute Change. The last step involved assimilating the changed in all levels of the company and retaining an open relationship in the company. The reason was to reduce any constraint that would have resulted from communication lag as was the case in the previous regime. The company also succeeded in removing the barriers considered as anti-change. The instance took place when a CEOs contract was terminated followed by restructuring of the organizational down supervisory level to allow accountability ensure clear ownership. Some short-term wins as the company began to win some contracts and turnover for 2013/14 rising to £160 million (Cameron, 2015). The speed of changed was achieved by ensuring that employees were skilled enough to enable them cope up with some of the critical processes. Finally, as stipulated in the last step, change was instituted by airing out some of the binding factors between company’s stakeholders. Conclusions The success rate of change can only be estimated using different change models discussed before. Different models have different results, therefore in the case of TED, several change models were applied at different stages of change. The most significant change in the system came from the change kaleidoscope model by Hope and Balogun. The success rate of the model was significantly used in restructuring the organisation (Cameron, 2015) The model was also used in promoting teamwork and effective communication at different levels of the company. The consortium of methods spontaneously changed the perception of the management team, spurring good relations that were required in sound decision-making. It can be deduced from the content analysis that Ascension plc (TED) was very successful in executing some of the changes required. The case study indicated that the strategic tools could be adopted to ensure that of achieving the desired set goals .TED company employees played a very critical role in ensuring that the implementation of the set change process they allowed to play as a team through consultations which brought very friendly relations with the companys customers. Also encouraging flexibility to the staffs had helped to change the organization to a successful one in 2014. When new CEO took over the company, the employees were self-motivated by being given a chance to explore themselves. Human resources make the major asset of the company (Krogerus, 2013). It maintained the clear role and responsibility and management structure decreased which lead to cost saving. The adaptation of change process on TED was successful due to unique management system. The management team together with most of the employees inside the company has helped it to perform and achieve its objectives since the o organization could bid for huge contracts after the so-called three-year transformation. In summary, if all the change channels are sustainably implemented as was observed in TED, it would be evident that future prospects will be higher that presently. The lesson learnt from the case study entails the fact that change is an inevitable ingredient that must be used in order to spark progress in any organisation (Komives, 2009). Bibliography Balogun, J. (2008). Exploring strategic change. Harlow, England: FT Prentice Hall Financial Times. Biech, E. (2007) Thriving Through Change: A Leader’s Practical Guide to Change Mastery. Alexandria, VA: American Society for Training & Development. Cameron, E. and Green, M. (2015) Making Sense of Change Management: A Complete Guide to the Models, Tools and Techniques of Organizational Change. United Kingdom: Kogan Page Ltd. Komives, S. R., Wagner, W. and associates, (2009) Leadership for a better world: understanding the social change model of leadership development. San Francisco, Calif.: Wiley, John & Sons, Incorporated. Krogerus, M. and Tschappeler, R. (2013) The Change Book: Fifty models to explain how things happen. United Kingdom: Profile Books Ltd.Martin, J. (2005). Organizational Behavior And Management. London: Thomson Learning. Norland, D. (2006). A Kaleidoscope Of Models And Strategies For Teaching English To Speakers Of Other Languages. Westport, Conn.: Teacher Ideas Press. Sabri, E., (2007). Purchase Order Management Best Practices. Ft. Lauderdale, Fla.: J. Ross Pub. Read More