Change Management at British Telecom - Assignment Example

Assignment, Human Resources (HR Leadership July 05, Assignment Analysis of Experience Leadership in a Telecommunications Company: Change Management at British Telecom Answer: About BT: Founded in 1846 in London, British Telecom (BT), the former public limited company, is one of leading telecommunication companies in the world. Operating in 170 countries, BT provides a range of services such as fixed and mobile telephony, broadband Internet, fibre optic communication, IT services, and digital television. The firm had a turnover of £ 18.017 billion in 2013. Over the years, BT had grown bureaucratic, and lethargic, and the management needed to change the organisation culture, to make it more competitive, hence, a change management and restructuring program was undertaken. Objectives of the change management programme were to, restructure the organisation, introduce a collaborative culture, and transform the organisation into an agile business. This section critically reviews the change management program, initiated by the management, through the human resources department (UKWON, 2008). Literature Review: Change management is often a traumatic experience, especially for old firms, since it can involve restructuring the organisation, bringing in process and technology changes, terminating or redeploying the older staffs that do not have the required skills for the new technologies. In many cases, the change begins at the organisation culture level as the firm tries to transform itself (Morgan, 1997). For these reasons, the initial resistance to change in many organisations is high, and the HR department needs to use finesse and tact in the change management process (Burnes, 2004). Different types of change management are developmental, transitional, transformational, planned, emergent, radical, incremental, episodic, and continuous. Developmental change seeks to correct existing processes, such as improving the skills or processes (Wilkins and Patterson, 1985). Transitional change is about seeking a different state, from the current state (Fernandez and Rainey, 2006). Transformational change tries to create an organisation that is significantly different from the existing state, and it can affect the culture, internal processes, strategy, and the organisational structure (Shaw, 1997). Each of these changes has their own methods and dynamics, and is implemented with different time spans, during which the organisation must change (UKWON, 2008). Leadership and change management process at BT: The forces of globalisation and the free market policy, which the UK government brought in, triggered the problem of change management at BT (Sperber, 1996). As a result, many new telecommunication firms such as Orange, entered the market, threatening the monopoly that BT enjoyed for than a century. Among the BT divisions that needed to change, the BT Wholesale division was the most affected since 68 percent of the staff was above 43 years, and the division had to be downsized. However, BT employees are unionised, and the unions are not ready to accept any job losses without a fight. To implement a smooth change management process, BT designed a number of new frameworks and initiatives, aimed at retraining the workforce and deploying them internally. The BT Skills Transition Centre managed the retraining and deployment of about 43 percent of the staff, by using the people transformation programme. Additional investments were made in the Talent and Leadership programmes, the Passion Matters programme and a number of BT tools such as ePulse, Sick Absence, STREAM, EEI (CARE), Behaviours Index, and Leadership 360, were used (UKWON, 2008). The BT management realised that while it had a strong technical workforce, the managers needed training to turn them into effective leaders. Three leadership styles were examined, passive, defensive, and constructive and the constructive style was adopted. The Passion Matters program helped 2000 senior and mid managers to be inspirational, and motivational in their approach. The newly trained managers then took up the task of handling the transformation of the BT Wholesale division and other divisions. The management obtained commitment and support from the staff for the transformation, and a voluntary approach with the union when jobs were lost. Remaining staff was retrained, re-skilled, and redeployed to ensure that the least number of people lost their jobs. Managers actively participated in the BT Skills Transition Centre to identify the skills that staff had, their potential and willingness to learn new skills, develop CVs, and provide the required training. In some case, the managers helped some BT employees to find jobs in other organisations (UKWON, 2008). Another important framework that BT used was the Accelerating Change Execution, where a flexible approach was used for change management, based on the divisions complexity, technology, and size. This approach helped to reduce the barriers for change management, and helped in greater acceptance of the proposals. Since the changes were needed at all levels and in different divisions, BT was able to make use of the large network, and redeploy the maximum number of people (UKWON, 2008). Results and lessons learned: The change management program helped BT to define the change envisaged for each department, adopt the correct leadership style, and train the middle management to be effective change managers. The result was a smoother transformation of the firm, while maintaining good communications and relations with the union. Change was evident in the organisation culture that was earlier slow, and it was now transformed into an agile entity, with quick decisions taken by a well-trained workforce. As a result, BT successfully transformed into an agile firm, that could compete with other players in the market. Moreover, the HR department developed a consistent approach, and it could manage the transition throughout its branches in other countries (UKWON, 2008). Among the key lessons learned were that barriers to change management are overcome by adopting a transparent approach, which focuses on giving retrenched employees an opportunity for re-training, and re-deployment. As a result, many staffs, aged 45 years or more, could learn new generation technologies, and compete with their younger counterparts. By first training the managers, BT ensured that the trauma of change management was managed adequately. The unions also supported the initiatives and agreed to the proposal of retraining, redeployment, and retrenchment when other avenues of employment were not available. The open attitude of the management, and support from the HR department, further helped the change management to transition smoothly. Assignment 2: Essay Question 3. What are the main sources of resistance to organisational change and how can resistance be overcome? Answer: Resistance to change and external stimulus is a natural response, since individuals resist any changes in the external and internal environment that proposes change. Previous negative experience about changes, or experiences of friends and acquaintances, brings resistance to any change (Bovey and Hede, 2001). The resistance to change is made of four phases, initial denial, resistance, gradual exploration, and eventual commitment or rejection of the change (Kotter, 1996). The higher management of an organisation usually puts all efforts in the technical aspects of the change, and ignores the impact on the employees, leading to employee resistance for the proposed changes (Morgan, et al, 2002; Luecke, 2003). Employee resistance is one of the main barriers to change management, and successful implementation of change needs to overcome this barrier (Oreg, 2003). Employees resist change, and the management needs to find ways to overcome these barriers, and these are discussed as follows (Todnem, 2005). Perceived loss of status and job security: An organisation responds to changes in the market, and consumer demand by launching new products, and by retiring obsolete products (Doyle. et al, 2000). If the new products require a new technology, or if the manufacturing is outsourced, then the existing staff becomes redundant, and resist the change by striking work, or approaching courts (Diefenbach, 2007). The best method to reduce the impact of such changes is that the management must retrain staff, and consider employing them in other positions. If redeployment is not possible, then they should be offered adequate compensation and retired (Waddell and Sohal, 1988). Unknown fears: In many cases, employees hear rumours about an impending change. These types of rumours become endemic when the organisation is being acquired, or if a joint venture is under consideration. In such instances, rumours, baseless fears, frighten employees, who remain unsure about their fate and fear the worst. Any changes that are announced invariably see resistance (Ragsdell, 2000). The best method to overcome and fight the resistance to overcome such fears is to communicate in an open and transparent manner. The senior management needs to address the staff in groups, and explain the status quo, answer questions, and reassure the staff about the planned changes (Worren, et al, 1999). Peer pressure and vested interests: Employees usually have work buddies or they belong to informal and informal groups in the organisation. In some instances when a change is planned, only a few jobs would be under threat, and the staffs, whose jobs are threatened, use coercion and blackmail to enlist the support of other employees (Vakola, et al, 2004). In many cases, unions also step in, block changes, and the firm may even shut down (Gill, 2002). The best method of handling such issues is to train managers, and ask them to speak individually to the staff or address them in small groups. The HR department can play an important role in this exercise (Mento, et al, 2002). Organisational politics: Change management sometimes brings in organisation restructuring, where existing divisions are merged, or made redundant. In some cases, when products are outsourced, the production functions become redundant. While such a change would benefit the organisation, division heads whose turf is reduced, find opportunities and methods to resist change by non cooperating, by inciting employees to strike work, and sometimes, vendors whose business is affected may also create hurdles (Mourier and Smith, 2001). Existing division heads may resent new managers from taking over the new work and coming into the limelight, while they are relegated to the sidelines, and professional jealousies act as resistance to change (Dooley, et al, 1999). The best method of overcoming such barriers is to use the services of existing division heads, and give them a meaningful role to play. If they are qualified and competent, they can help the organisation to grow and the change process to become successful (Douglas, 1995). Lack of rewards and loss of seniority: Closely associated with the reasons given in the previous sections, lack of apparent rewards, and loss of seniority acts a major resistance to change. When divisions are restructured and certain roles eliminated, some managers face the prospect of reporting to junior manager (Geertz, 1973). Such a reversal is not acceptable to many people, and the organisation stands to lose talented staff. Implementing the change management process means that staff has to put in extra effort. If rewards are not forthcoming, then they would lose the motivation to work harder (Handy, 1995). The best method to handle such problems is to ensure that when managers are redeployed, they are given jobs that allow them to retain their status and position. Where possible either monetary or non-monetary rewards must be instituted and given to deserving staff (Harrison and Stokes, 1992). Climate of mistrust: One of the greatest resistances to change is the climate of fear and mistrust. Such mistrust does not happen overnight but after years of bitter fights between the staff and the management. In such an environment, any announcements of change are regarded with suspicion and mistrust and the staff resist the changes, even without understand the details of the proposed changes. The best method to introduce change in such a climate is to develop open communication, either through letters, or emails, or by addressing open meetings. Employees should be encouraged to ask questions that would clear their doubts and fear (Johnson, 1992). As seen in the previous sections, it becomes apparent that the main source of resistance to change is the differences between the employees expectations and the management requirement. Employees like a consistent and steady workplace, with defined rules and expectations, while the management wants to change the organisational culture and processes, so that the firm remains competitive (Kroebe and Kluckhohn, 1952; Mihata, 1997). Some types of resistance occur due to fear of job loss, loss of seniority and loss of prestige. 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