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Management Change - Coursework Example

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Due to the advent of globalisation and rapid technological advancements most organisations that were established decades ago find themselves in difficult situations. They are mostly perplexed by the paradigm of changing their traditional organisational culture and style of management…
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Download file to see previous pages The same situation was present at Oticon where its activities adversely affected stakeholders. Some of the stakeholders had a direct interest and contact with the organisation while others had an indirect interest and occasional contact with it. For instance, Oticon customers were in need of the products manufactured by the organisation i.e. hearing aids, but preferred one that could be inserted inside the ear. Unfortunately, Oticon only manufactured hearing aids that could be placed behind the ear. On the other hand, Oticon customers demanded products that complied with the digital technology. This highly contributed to the plummet of Oticon’s performance and profit margins since it was a strong holder and advocate of the analogue technology. As a result, the organisation lost favour in the buoyant markets including the Far East and America. In addition, the shareholders wanted to own a fast-paced organisation that had a big market share and equity. Their main interest therefore was in the growth of their shares and dividends. Conversely, the management and employees of Oticon were interested in the growth of the organisation so as to ensure job security, a lucrative remuneration and positive prospects. This was to be achieved by increasing the organisation’s efficiency and implementation of cost-cutting strategies so as to run a more significant, fast and innovative business. This was with the aim of attaining a competitive advantage and market control. The other stakeholders of Oticon that were also gravely affected by the deteriorating state included the government, suppliers, trade unions and pressure groups. With the aim of dealing with the raised concerns Oticon’s President Lars Kolind formulated a viable strategy to enable implementation of management change. The strategy included a decrease in the price of the hearing aid, a reduction of the hearing aid’s size, layoff of some staff, increased efficiency, cost-cutting measures and implementation of a holistic customer care strategy which was to be supported by a spaghetti-organisational approach. This was to be achieved by changing the formal organisation of Oticon into a disorganised organisation. This involved the elimination of job titles and departments as well as the use of informal communication i.e. face-to-face. At first, this change was met with objection from employees where some felt that they did not possess the project management skills and ability to work as a team. Most, especially those that held hierarchical positions were against the loss of authority, status symbol, routine and information monopoly. In order to overcome, the resistance Kolind involved every employee in implementing the changes in the organisation. He ensured that every employee clearly understood the direction of the new management change. In addition he formulated human values that favoured employees and gave them the opportunity to empower themselves. As a result, a solid employer-employee relationship dictated by trust was established. Moreover, a carrot and stick leadership strategy was implemented. It gave employees only two options of either continuing to work at Oticon but under the new changes or resign. Therefore, majority of the employees had no choice but to comply with the stipulated changes than to lose their jobs. This strategy effectively curbed resistance because with time employees started to support the ...Download file to see next pagesRead More
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