Change Management for Richies Supermarket - Essay Example

? Change Management for Richies Supermarket I. Background Richies Supermarket was created by Mr. and Mrs. John and Marsha Smith whose first exposure in the market was through their attendance in the annual state fair selling the first variety of bread and homemade supermarket items. Over the years, it has created a significant following enough to have market base to continue and sustain the business yearly. While it started as a traditional hole in the wall Supermarket Store during annual state fair, the business became ripe for expansion especially with the introduction of new selection of popular brands that made Ritchies Supermarket a successful Retailer. The business has proven itself to be viable in the market evident with its regular success over the years. Sales increased exponentially and growth seemed unstoppable. Ritchies Supermarket’s growth however stifled in the last five years. Since then, sales has been in precipitous decline and if not arrested would surely plummet the family business in bankruptcy. II. Environmental Analysis The decline of the company begun when big retailers entered into the market. Along their entry into the market were their efficient operations that enabled them to slash prices deeply that blunted Ritchies Supermarket competitiveness. Competitors such as Walmart, TESCO has also the advantage of scale and technology that ultimately reflect in the price tags which is considerably lower than Ritchies Supermarket. In addition, these big retailers have forged relationships with their suppliers and make their own brand which allows them to have discounts which Ritchies Grocer do not enjoy. Their wastage and spoilage is also minimal because of their efficient inventory system wrought by their advance technological structure. Ritchies Supermarket thrived on its relationship with its customers which it has established over the years. It boasts itself as a mom and pop Supermarket that capitalizes on its bond with its customers. But this relationship proved to be fragile especially when assaulted with discounted prices which big retailers such as Walmart and TESCO can afford that chipped away Ritchies Supermarket’s market share. Ritchies Supermarket’s shrinkage of its market share was significant during the recent 2008-2009 financial crisis where customers became sensitive with prices and this prompted a mass exodus of its customer base to big retailers to the point that it threatened its viability as a business. III. The Need for change The recent development in the market only tells that the old business model that made Ritchies Supermarket a success is no longer applicable. It has to adapt to the new market reality or otherwise perish. The necessity of implementing change in the company is now an imperative if the company is to survive. Parties affected by change It is a given that change is needed for the business to survive. The owners and its shareholders want it to keep the business a going concern and to ensure the continuous inflow of profit from the business. Not all parties may be enthusiastic with the necessary change in the business. Employees may not want it having been comfortable and accustomed to the the old business practice of the company. Management has to anticipate that in implementing change, resistance is often common. Resistance however fizzles out when the change is properly communicated among the employees. Second, the organization itself may not be able to adapt to the new system that is being introduced by change. Such, retooling may be necessary to enable the workforce to adapt to the new organizational change. This can be done through trainings and workshops. A follow through is necessary to ensure that the introduced change will be embedded as a new organizational culture. Reinforcement mechanisms must also be in place that will facilitate the assimilation of the change in the organization. IV. Implementation of change The premise of change The need to align product and service delivery in accordance to customer expectations and the market imperative to reduce cost to remain competitive in the market compels the operations of Ritchies Supermarket to think of management implements that would serve this purpose. This will entail cultural change, structural, technological and process change in all aspects of the organization for the business to “shape up” and remain relevant in the marketplace. Any activities that does not bring value should to the organization or anything that customer is not willing to pay should be removed to enable the company fit for competition. This change should bring about the desired output of retailing product/service at a competitive price and better service. Corporate culture Culture is the driving force that causes the organization to follow (Kilman, 1986). A culture has positive impact on an organization when it points behaviors in the right direction, is widely shared among the group members, and exerts strong pressure on group members. If a culture is mobilized against the mission of the organization, it is better for the organization to have a weak culture (wrong direction, but not strong or pervasive among group members) than to have a strong counter culture (wrong direction, but very strong and pervasive). The impact of organizational culture however depends on its pervasiveness within an organization whether it is widespread, or shared among the members of the group. Cultural Analysis at Richies Supermarket In the case of Richies Supermarket the old culture of comfort wrought by mom and pop supermarket store where premium is placed on relationships are stressed rather than efficiency is pervasive and deeply rooted because such culture was key in the success of the business in its early phase. It is not a surprise that such culture pervaded the business because the business was started as a family business by Mr. and Mrs. Smith who was able to grow the business by establishing good relationship between their employees and customers. While this culture can be considered complacent and prone to waste by today’s standard of efficiency, it did help the business to establish a foothold in the retail market. Due to the pervasiveness of this culture, the employees are resistant to something new and are not inclined to learn new technology. Supervisors are also generally tolerant to tardiness and unscheduled absence owing to the personal nature of the business culture hence its high inefficiency. The prevailing corporate culture has positive aspects such as employees tend to be more loyal to the company but its disadvantages far outweigh its advantages and even caused its declined in recent years. New competitors are entering into the market with lower price, better amenities (service is still better at Ritchies Supermarket because it is personalized) and better operation process while Ritchies Supermarket is still basking in the comfort of its traditional ways. V. Changes needed a. Corporate culture Culture, is the shared philosophies, ideologies, values, assumptions, beliefs, expectations, attitude, and norms that knit a community together. All of these interrelated psychological qualities reveal a group agreement, implicit or explicit, on how to approach decisions and problems or “the ways things are done around here” (Kilmann, 1986). Culture is manifest in behavioral norms, hidden assumptions, and human nature, each occurring at a different level of depth. “At its deepest level, culture is the collective manifestation of human nature – the collection of human dynamics, wants, motives and desires that make a group of people unique” (Kilmann, 1986). Culture in Ritchies Supermarket can be changed on a top down when “one single corporate culture exists (and those at the top thus could be accurate in their view of their desired culture) and if the focus is on changing norms and not assumptions. “This is however may be difficult to sustain, even though such changes may be easy to bring about; top-down approaches generally result in overt compliance to what is mandated, not covert acceptance” (Kilmann, 1986) so that, a participative approaches to changing underlying assumptions, although difficult and time-consuming to implement, are likely to result in changes that last and are felt in everything that organization members do; participation yields overt commitment to and covert acceptance of what the group decides. Thus, to make the intended cultural change in Ritchies Supermarket, it should involved its employees in forging the cultural change within the organization to achieve acceptance among the workforce and make the necessary change lasting. The required change may tough considering that it involves a total overhaul or a sweeping cultural change among employees but this can be done and it has already been done before. One example to point in this case is the AT&T (American Telephone & Telegraph) experience, “is undergoing a dramatic culture change at all levels so the company can succeed in its new, highly competitive environment” (Turnstall). It used to monopolize America’s telecom industry and got complacent but it was able to change dramatically to adapt to the new competitive environment. b. Management structure Perhaps the easiest component of Ritchies Supermarket to change is its management structure. The owners realize that the more complex the marketplace has become, the more it is necessar to institute change inorder to adapt (Cummings and Vorley, 2009). They also realize that there is a need to professionalize the management team of the company and move it from being “family centered” to a professional one. c. Technology Technology is an important organizational competence that can enhance a company’s competitiveness. It enhances a company’s competitiveness by being more responsive to customers’ needs and being more efficient. In the case of Ritchies Supermarket, it has to make technological investment particularly in in-house designed supply chain application to enable it to increase the availability of its stock and reduced warehouse stocking resulting in the more efficient operation of its warehouse. At present, its warehouse inventory system is very susceptible to spoilage that stocks come and go unmonitored and unaccounted. d. Personnel capability People are a major focus in implementing change management. People are the major focus of organizational change because “it is the people who will ultimately cause the change to be a success or a failure. The implications of change on individuals are important without which we can never really hope to manage large scale change effectively” (Murthy, 2007 pg. 23). It goes without saying that there should be behavioral and capability change and improvement among the personnel of Ritchie to make the company more responsive to the new market reality. VI. Resources needed The resources needed to implement this change are tremendous because the change that is required for the organization to be abreast with the new market reality can be considered an overhaul that affects every aspect of the organization. Outside consultants with fresher perspective need to be hired along with new managers who would implement such change. Resources in terms of technological hardware are also needed and along with it are IT personnel who would facilitate the technology transfer to Ritchies Supermarket’s employees. New equipment may be needed and possibly new warehouses may need to be built to shape up the operation of Ritchies Supermarket. VII. Behavioral and technical changes desired to make the change effort successful It is anticipated that there will be strong resistance among Ritchies Groceries employees’ in the intended change to be implemented. This does not mean however that management should defer the implementation of change because the more it delays, the more chance that the competition that will “eat up” Ritchies Supermarket market share and it may be too late already if the intended change will be shelved. To make the employees of Ritchies Supermarket receptive to change, a behavioral approach must be used to make the employees more receptive to change. The behavioral approach is to make the reward strategies right to make individuals receptive to change. Basically this entails understanding how individuals perceive change and to understand what makes an individual tick. These approaches are important because without understanding an individual’s behavior, no amount of reward strategy can be successful that would later facilitate change. The behavioral technique involves a cognitive approach is to link goals to employees motivation. When an individual is already understood on how he or she perceives change and has already identified the factors that will motivate the individual to be receptive to change, such willingness to adapt to change could be aligned with the intended change and ultimately, to the organizational goals. The psychodynamic approach is to treat people as individuals and understand their emotional states as well as the management’s own (Murthy, 2007). Simply put, treat others in the same manner we would like to be treated when we implement change. VIII. Communicating change Communication is the bedrock of an organization. It became an organization because of people who are linked together through an agreed structure of hierarchy and functions that share a similar objective (Woods, 2004). Communication is the medium to relay the greater objectives of the organization and the enabler that makes team and organization function effectively and efficiently (Adler, 2010). Such, the intended change in Ritchies Supermarket should be an enabler that would link the organization as a whole to work as a team towards a common organizational goal and be cascaded and felt up to the small business unit in the organization to make the change potent. The intended change requires an effective marshalling of organization’s resources (people, information, finance, technology) and this cannot be achieved without an effective communication between the management and the employees. As previously discussed, all channels of communication must be opened encouraging participation of the employees to make them commit, accept and to a certain degree, claim ownership about the necessary change in the organization because their perspectives were taken into consideration during the process of implementing change. Effective and open communication in the organization will also lessen the friction and conflict among employees and between management and employees which could sometime inevitable in implementing change. The energy of both parties can then be directed in implementing the best organizational change possible and away from the resolution of conflicts that typically characterize organizations when undergoing change. IX. Instilling the new culture In implementing change, a new corporate culture must be introduced. This new culture must not only reflect the organization’s values, but also one that fosters competitiveness and serves the greater objective of the organization and the community at large. Equally important in instilling this new culture is the emphasis of ethics which now becomes a business imperative as consumers are becoming more sensitive with the ethical practices of businesses. To successfully introduce a new culture, it will not suffice to implement it through lip service by merely cascading the information to the organization. The new culture has to be practiced at a norm level, beginning with the day to day demeanor of Ritchies Supermarket’s executives and managers that would encourage the members in the organization to behave in a new desirable ways. Being aware that for such change to be sustainable and become ingrained, management has to devote time to changing the “deeper, more fundamental aspects of culture so the change will be sustained.” Again, the participative method that involves the employees is necessary to fine tune the culture change according the circumstances and environment of the organization. X. Trainings necessary Changing people’s behavior and corporate culture in an organization will be meaningless if is not accompanied by retooling the employees to enhanced their capabilities that would empower them to be competitive in the new market environment. It is “a learning process that involves the acquisition of knowledge, skills, concepts, rules, attitudes and behaviors that enhances the performance” (Indradevi, 2010 pg. 49). The development of any effective training program should begin with a needs analysis (Price, 2010 pg.128). In the case of Ritchies Supermarket, trainings are necessary in growth areas of information technology, operations process, inventory system and other areas which the management may identify to be an area of improvement after training needs analysis. Delivering a training program is not enough. It has to be constantly evaluated to determine how training intervention and approach could effectively contribute to the realization of our training objectives (Rehman, et al., 2011). This underscores the need of a systematic monitoring and evaluation of any training program so that improvement can be implemented in the succeeding training programs (Giangreco, 2009). XI. Force Field analysis There are two opposing forces in Ritchies Supermarket in relation to the proposed change. These forces are more than the employees who wants to keep the status quo. They are the prevailing values that Ritchies Supermarket is already comfortable and accustomed to and reinforced by its previous success that made what the Ritchies Supermarket is today. On the opposing side of the equation is the management who find the necessity of change in order to survive and thrive in the new market reality. They want to “shape up” the organization while the employees want to keep the old ways. Strategy The best way to implement change considering force field analysis that would avoid conflict is to engage the employees in the process of planning. This explains the reason why it was previously stressed that the employee must be involved because failure to do so would mean greater resistance to change. Open communication and consultation is also necessary to further weaken the force that opposes change that instead of maintaining them as oppositions to change, transform them instead as agents of change in the organization. XII. Timeline of implementation It is expected that the implementation of the change management could take a year. The entire process of implementing change involves the following process; planning, consultation, communication, launching, training and retooling and evaluation. Planning - is the first process where objectives and goals of the needed change are defined. At this stage, strategies on how to attain and realize the desired change in Ritchies Supermarket are also laid out and the plan on how to coordinate various resources and activities are also enumerated at this stage. Consultation – to make the desired and needed change acceptable and lasting, it has to involve the party affected by the change which are Ritchies Supermarket employees. This is a necessary stage whereby inputs and participation from the employees are taken for the greater efficacy of the implementation of change management and to make the necessary change acceptable. Communication – once the plan of implementing the change had been completed which included the employees in the process, it has to be perpetually communicated to the entire organization not only to be understood but also to be accepted as well. The intended change that will be implemented can only be effective if there is cooperation among employees of which an effective communication can facilitate. Launching - after soliciting understanding, acceptance and cooperation from the employees about the necessary change, it is now high time to launch the change management program. The commencement of the change management will involve all aspects of the organization. Training – retooling the employees is central to the launching of the program whereby the intended cultural, behavioural and technical change are imbued among the employees through the various training sessions that includes technological training, communication worskhops, leadership training, etch that would enhanced the capability and outlook of Ritchies Supermarket’s employees. Evaluation – the plan, including the training program should be periodically evaluated to determine its efficacy and seek more improvement on the intended change. Below is the proposed timetable of the implementation of the change management in Ritchies Supermarket. Months 1-2 3-4 5-6 7-8 9-10 11-12 Planning Consultation Communication Launching Training and retooling Evaluation References Adler, Ronald B. (2010). Types of Business Presentation. http://highered.mcgraw-hill.com/sites/dl/free/0073385174/776535/SampleCh13.pdf Giangreco, Antonio; Sebastiano, Antonio; Peccei, Riccardo (2009). Trainees' reactions to training: an analysis of the factors affecting overall satisfaction with training. International Journal of Human Resource Management. Vol. 20 Issue 1, 96-111. Indradevi, R. (2010). Training for Most Capable Workforce. Advances in Management. Vol. 3 Issue 12, p49-54. Kilmann, Ralph H.; Saxton, Mary J.; Serpa, Roy (1986). Issues in Understanding and Changing Culture. California Management Review, Vol. 28 Issue 2, p87-94 Murthy, C.S.V. Change Management. Global Media, 2007.  Price, Robert; Jim Lee; Kozman, Theodore (2010). USE OF COMPETENCY-BASED NEEDS ANALYSIS IN DEVELOPING EMPLOYEE TRAINING PROGRAM. International Journal of Business & Public Administration. Vol. 7 Issue 1, pg. 117-130. Rehman, Atiq Ur; Khan, Azhar Mansur; Khan, Rashid Ahmed (2011) Measuring Training Effectiveness: A Case Study Of Public Sector Project Management In Pakistan. Journal of Diversity Management. Vol. 6 Issue 1, p39-48. Woods, Philip A. (2004). Democratic leadership: drawing distinctions with distributed leadership. International Journal of Leadership in Education, 7(1):3-26 Turnstall, Brooke W. “Breakup of the Bell System: A Case Study in Cultural Transformation,” in Kilmann et al., op. cit., pp. 44 Read More