Change Management Program - Assignment Example

Change Management Abstract: Management has always been a key of ensuring that a company is able to adapt to the various changes that are occurring in the market economy. In the following paper there shall be a detailed discussion conducted on the requirement of change management by organizations. Along with the discussion will also identify the significance and importance of change management. Following this discussion the various steps that are taken by managers at the time of change management implementation will be identified and this will be supported by the various management theories that have been developed over the years. The purpose of the paper is to ensure that a well developed understanding of change management is developed and established. Introduction:  Management is an important functioning for all companies in the world today. There has been realized that the functioning of the various organizations can only be realized through efficient and economic management of all the various variables of the production process. In the following paper there shall be conducted a detailed discussion on the rational organizational theories that have been adopted by various management departments to ensure that the production process is more smooth and proficient in nature. Management is defined as the process of administering and coordinating resources effectively and efficiently in an effort to achieve the goals of the organization. Managers plan, lead, organize and control. Managing in the 21st century can pose many challenges. The following paper will explore the various areas where change management is a component of managerial practices and ensure that there is carried out a clear mapping of the change management program as adopted by an organization. The discussion will be carried out in a structured and systematic manner to ensure the development of the discussion in a holistic manner, which is easy to comprehend. Need for change management: A decade ago the term strategic discourse was strongly supported by all individual companies and organization. It was believed that with the correct management of resources and through a precise study of the market forces the production process could not go wrong. But with time, due to the emergence of multifaceted complexities in the market system there has been seen that it is no longer enough for most companies to just manage their resources in a most utilitarian manner. As has been specified by Mintzberg in his book ‘The Rise and fall of Strategic Management’, two decades ago most companies and organizations firmly believed that ‘planning could not go wrong’. This has not completely disappeared but there have emerged other concerns that it has to accommodate such as competition, forecasting and others. But as has been clearly specified by Karger and Malik, “The top management of any profit seeking organization is delinquent or grossly negligent if they do not engage in formal, integrated, long range planning.” There is thus today felt to ensure that the management of the resources are conducted in such a manner that they are channelized towards marketing of the products, which is usually done through marketing of the products and creation of strong communication channels where the companies aim at capturing and retaining the interest of the consumers. The management thus has to change and alter itself to ensure that the company is able to accommodate the changes that occur in the market economy and in the demands of the customer. With the introduction of modern methods of marketing and innovations in the management and HR processes there has been an increasing commoditization of brands thereby making competition fiercer and tougher and thus harder to beat. It is doubly important now more than ever that the customers be assured of In a time of economic uncertainty—with customer trust eroding and purchase behaviors growing harder to predict— the ability to build and retain customers through adding customer value to products is of incredible importance. The following report seeks to outline a management and operations change plan to ensure that an organization can bring into place a strategy of marketing that is removed from traditional approaches bring this strategy in line with HR and operational changes within the company so as to ensure customer retention through the process of customer value creation. To survive and even thrive in today’s difficult economic environment and come out the winner from the challenges that face the company today is essential that the organizations should takes a fresh look at the strategies and methods that it has undertaken till date in order to ensure the retention of customer. It is also necessary to examine the areas where the depth of commitment has been lacking and ensure the change and revision of the strategies that are flawed and have not yielded the requisite results. The threat of declining customer revenues and defection is real and must be addressed (Futoran G C, Rivera J B, Hunt J G, 1997). At the same time it is also essential that there be in place a realistic understanding of the economic climate that creates new opportunities if the company has to try and improve market position and its chances of development through a process of construction of customer trust, creation of a meaningful brand differentiation, remodeling and customizing offers in the context of customer needs that are evolving and, if necessary, the negotiation of new terms. It can be said at the risk of sounding high handed, that it is in fact those organizations that are able to not just maintain but are able deepen relationships with their best customers during this weak phase of the economic cycle will be well positioned to eclipse their rivals when the economy reignites.   What becomes essential now is the creation of plan which is concerned with organizational and HR management related changes so that the cuts that have had to be made on the marketing side can be negated and there is a strong measure of customer retention. The thrust area therefore now shifts from the acquisition of new customers to the retention of the existing ones creating a stronger business base from the resources that they are able to provide the company. This would mean changes at both the internal and external organization strategies of the company (Alexander, 2000). The internal strategies would include a reorganization of the existing staff and a redefinition of their duties leading to an improvement in performance as manifested in customer satisfaction and the external changes would include those changes that can be made in relation to the dealings with the customer directly increasing the value of his experience and ensuring his loyalty to the company and its products.  Change Management Program:   In the following section of the paper there will be developed a change management program which can be implemented by an organization to ensure that it is able to alter its functioning in accordance to the requirements of the market. First and foremost there is a need to identify the strengths and weaknesses of the organization or a thorough plan of internal analysis. This would include the appraisal of the company’s organizational resources and capabilities in the context of value creation opportunities and other external developments. Plan of Action There are five basic steps that can be identified in order to chalk out in more consolidate terms an essential plan of action (Anderson, 2007). 1. Examination of current customer Base: The first step that has to be taken as part of the necessary aspect of the initial stages of plan implementation would be an examination and identification of the existing customer base. This would help in providing a better understanding of the nature and the scope of present realities of customer base retention. There could also be a process of customer segmentation that can be put in place. 2. Understand the timeline to customer profitability: There is an acquisition cost that every customer has for the business. This needs to be identified and examined. What this means is that the company has to aware of the timeline that it would take to ensure that a customer becomes profitable entity for the company. This can be done by subtracting the price or the input that is required in order to get hold of and serve the customer from average customer returns over time. It is companies that are good at this calculation that can use individual customer revenue and get into cost minutia to attribute costs at an individual level and even include costs like physical plant and electricity. If the organizations are just getting started it would be easier to keep this particular part of the research to averages. Since the size of operations is also small the process of calculating average timeline customer profitability will serve the purpose as well. 3. Set a target retention rate: The setting of the retention target rate is like setting the target of profit because by following a customer retention strategy to boost profits we are linking the KPI directly to the profit manifestations in the accounting sheets. The idea therefore is that there has to be a setting of clear targets and a clear timeline in which the target has to be achieved. 4. Defining marketing tactics: This is important is this would probably form the very basis of the success and failure of the plan. It has been dealt with in better detail in the next section. 5. Measure results consistently: Finally it has to be ensured that results are compared and evaluated at well defined and periodic intervals to assess the success and the failure of the strategies adopted. There is also the need to ‘tweak programs’ at intervals to ensure that they do not become stale and keep with the evolving requirements of the customer base. This means that the strategies adopted should not become redundant. Theoretical Background Changes that are to be effected in human resource management to ensure better retention can be made in congruence with the Wobbly Model of HR management. The idea is that it is the employees that are the re-inventors of real change. The reinvention that really counts is that of business rather than that of culture (Nijssen and Frambach 2000). The leaders radically change the 'business design' in ways that generated 'profit-protecting power'. The highest power is derived through applying the most effective 'strategic control point'. According to the theory there is just one 'strategic control point' is ranked as 'high' and that would be 'owning the customer relationship', Welch supposedly occupies this control point by managing in the spirit of three simple Profit Zone questions: 1. Who are the most profitable customers?  2. Within that group, which customers have the highest profit growth potential? 3. What mix and level of investments are needed to meet those customers' needs efficiently and enable profit growth to occur? The idea here is simple, stop selling products and start selling solutions. Far from being revolutionary this should be made the first basis of effective salesmanship in the company. Another principle that can be found as having an application here is that a change in strategy would mean that there be in place a new set of capabilities and a realignment of the core elements of the organization (Barney J and Clark D N 2007). The resource based theory can also be used in order to understand the importance of HR restructuring. The value of people and their knowledge is a competitive advantage. It has been noted by scholars that people contribute in a big way in terms of customer efficiency, customer referral and customer retention Emphasis has to be put on the development of new products along with a culture with is centered on efficient and friendly service (Barney and Clark, 2007).         Enumeration of Strategic Steps HR related changes: HR related steps would include a better training and incentive schemes that will ensure better performance and an increase in individual output. What this means is that the company has to ensure a maximum utilization of the resources that are available in terms of human assets (Kates and Downy, 2006). This can be ensured by: 1. There has to be the creation of  a strong base centered around training and product familiarization and sensitization that would ensure a strong functional and product expertise which in turn would be aligned to customer segment 2. There has to be the creation of flexibility without the added burden of costs in the management of the team 3. It also has to be ensured that the face of the product that is the front of the office is a manifestation of the back or the manufacturing units. What this means is that there has to be a greater integration of the two leading to better product merit highlighting. 4. There also has to be an attempt to ensure that the company gets the better of benefits extracted from the centralized infrastructure and decentralized decision making process. Most of these practices will end having manifestations in a better product experience for the customer thereby ensuring an increase in customer value creation. Beside HR related changes there are other operational changes that can be made which are low cost but can turn out to be incredibly effective for a small venture. For the implementation of this part of the strategy there will have to be in place a marked and conscious move from the goal of customer acquisition to customer retention. The ideas that have been enumerated in this particular part of the strategy plan will work only if the customer is actually benefiting from the retention strategies which would bring us to the merit of the product. Assuming that the product has quality and strength to attract and hold the attention of the customer and keeping this variable as a stable for now there can be the enumeration of organization changes that would help in customer retention through the creation of customer value (Hughes, 2006). These would include 1. The creation of membership cards and membership programs which would give the customer a feeling of family and belonging beside enhancing an opinion of getting value for money and added services 2. Simple Welcome and Thank You services in terms of actual hosting and gift vouchers. 3. Satisfaction surveys, followed up by phone calls and letters 4. Beefed up customer service, empowered to solve problems Conclusion: In Conclusion therefore it may be reiterated that the strategy is sound but requires incisive research along with a process of efficient implementation if it has to work. There is also the need to outline targets in terms of numbers and individual customer retention if the plan has to work as an effective substitute to an active marketing strategy. It can be stated with a degree of conviction also that the creation of value and the process of growth as hinged on its successful development is dependent upon interaction and dialogue between the company and its customers. It is in fact through the process that the producer can estimate the factors that hold value for the customers and can tailor products accordingly. If the company has to deliver this objective and hope to gain some sort of leverage from its deliverance it would be essential that all of the key success factors of the value chain are kept in mind given equal attention. These factors can be technology-related, operations-related, distribution related, marketing related, skills related, and capability and competency related among other things. References: Alexander A, 2006: Performance dashboards and analysis for value creation, Edition: illustrated, Published by John Wiley and Sons, p75-78 Anderson E, 2007, Five Steps to understanding Customer Retention, Unica Corporation, Customer Think, accessed on October 9, 2010 at http://www.customerthink.com/blog/five_steps_understanding_customer_retention   Barney J and Clark D N 2007: Resource-based theory: creating and sustaining competitive advantage, Edition: illustrated, Published by Oxford University Press p132-136  Futoran G C, Rivera J B, Hunt J G, 1997: The temporal impact of management faculty style and course characteristics: some theoretical and development Implications Group & Organization Management (USA), Emerald Management Review Database, Vol. 20; Issue: 3; p310-337  Hughes M A, 2006: Customer Retention:  Integrating Lifetime Value into Marketing Strategies, Database Marketing institute, Ed.3, Pub. McGraw Hill, p 56- 57  Karger, D. W., & Malik, Z. A. 1975: Long-range planning and organizational performance. Long Range Planning, 8(6): 60-64  Kates and Downy, 1996: (Re)designing the HR organization, Pub. Entrepreneur, Sec. Human Resource Planning accessed on October 9, 2010 at http://www.entrepreneur.com/tradejournals/article/148185357.html  Mintzberg H 1994: Strategic Planning, The rise and fall of strategic planning, 1994, Free Press Edition 1998, pp 458  Nijssen and Frambach 2000, Creating customer value through strategic marketing planning: a management approach, Edition: illustrated, Published by Springer, p54-58 Read More