Critically discuss the leadership and change management theories within the case study - Essay Example

? A case study of Leadership and Change management theories in Biogen Idec Inc. Introduction Biogen Idec is a global biotechnology company that has transformed greatly in the past 25 years to become one of the largest companies in the world. Through mergers with other companies, it has developed into a big company with presence in most parts of Europe and America. Currently, the company is on the verge of changing its operations in order to improve the performance of the company. Managing change is an important aspect of the organization in order for them to remain competitive by responding the market needs. The concept of organizational change and leadership management require a lot of concern since any mistake may lead to big losses (Styhre, 2002; Charlton & Andrew, 2004). Organizations operate in increasing competitive and chaotic global business environment and thus it should form a major focus of the business management. This is because there is enough evidence that about 70% of organizational changes fail to yield enough fruits as projected by the management (Burnes & Jackson, 2011). A properly structured organizational change should thus take full care of content, people, and process since they are the determinants of success or failure of such an initiative (Myungweon, 2011). Leaders are the formulators and implements of any organizational change; hence, they should be responsible for the success or failure of such initiatives (Aaron & Elizabeth, 2012). Leaders are also important to the change process since they create and develop an acceptance culture of change in the organization and develop the ability to achieve such as change as projected by the company (Northouse, 2012). Change Models Kotters 8 Steps The use of Kotters method is evident in the change undertaken by Biogen Idec Inc since they began their initial step of organizational change by conducting research and creating urgency for change. In this method, organization change can be effectively managed using a dynamic 8-step approach that includes increased urgency, building grid teams, get the right vision, communicate for a buy in, enable action, create a short term win, don’t let up, make it stick. The steps are further divided into three phases whereby the first phase is creating a climate change; the second phase is engaging and enabling the whole organization while the last step entails implementing and sustaining the change (Hayes, 2010). Creating urgency This is the first step of Kotters change model whereby he argues that creating urgency enables the members know what they really want and develop a sense of urgency around the need for change. In the case of Biogen Inc, the headquarters in Paris was responsible for all finance, legal, Human resources, and commercial activities of the organization, making the decisions slow and bureaucratic. The urgency created by the management is upon realization that this type of organizational structure is slowing decision making and at times leading to erroneous decisions. They thus needed a structural model that can quicken decision making of the managerial functions to avoid several errors that may inhibit the development of the company. Creating urgency helps spark the initial motivation of the workers so that they respond by getting things moving in the direction of change. It involves showing people the poor performance of the organization and increased competition that threatens the existence of the company. Kotter (2012) argues that about three quarters of the organization management needs to support the change initiative for it to be successful hence, the need for creating urgency must be very strong. Form a powerful coalition After the worker have seen the need for change, they need to work together to achieve these desired changes. This step involves convincing people that change is necessary and it encompasses strong governance and sustenance from individuals within the organization. In order to influence the process of change within the organization, it is prudent to form a coalition of strong team who come from various departments and ensures that they work together. Biogen Inc Company operates in different branches in different parts of the world. Their team for change must consist of people drawn from all these branches in order to form a powerful coalition that is necessary to initiate the process of change. The changes needed by this company must be felt across all its branches hence representatives from all the branches must be part of the decision making process. Create a vision for change Kotter (2012) argues that a clear vision helps everyone understands the need and the aim of the change to motivate them. The leadership of Biogen Iden Inc developed values that are central to change, create a strategy, and ensure that change coalition have easily mastered all the concepts of change. They had a vision of changing their operating system within different market in order to promote the development of their company that forms part of their vision statement. The company is continually conducting research and this enables them to have new products that need a more active presence in the market to increase their sales and profitability. Communicate the vision The vision of the company determines the path to success since the messages have a strong implication on the day-to-day working of the business. The vision statement needs to be communicated frequently, powerfully and embedded in every operation of the organization. Any vision no matter how important it may be must be properly communicated in order to effectively realized it and in good time. This also forms part of their core value whereby they assert that they confront challenges and uncertainty with zeal, tenacity and vision and seize opportunity to excel. Remove obstacles In their bid to remove obstacles, the leadership of Biogen Idec Inc effectively puts the structure of change, continually check for barriers, and removed them as soon as possible to motivate the employees. The biggest obstacles to changes are the workers themselves hence people who are resistant to change should be identified and made to see the relevance of change. There were resistance to change in reporting lines in the case of Biogen Idec Inc., but groups and folks abandoning a direct reporting. The organization can also decide to identify and hire change leaders to help initiate the change process. Create short-term wins The leadership of Biogen Idec Inc is careful enough and they avoid declaring victory early since real change runs deep and quick wins are only a beginning of what needs to be done to achieve long-term goals. The employees need some motivation and this can easily be achieved when they are given a taste of victory. This is achievable by creating short-term achievable targets and quick wins that can easily be seen by the employees. Build on change Each success achieved by the organization is an indicator of what went right and what when wrong to identify the paths of improvement. Biogen Idec Inc managed to survive successfully by conducting research and development and this is properly reinforced in the company vision so that that can continue to build on it. This company has survived by expanding into different markets and this is the reason why they want to build on it by opening active branches instead of operating through distributors. Anchor the changes in corporate culture The leadership of Biogen Idec Inc ensured that the change appears as the corporate structure of the organization and ensured that it gives the necessary support to such initiatives. According to Edwards (2005), continuous effort should be made to ensure that change is seen in every aspect of the organization. The company gives about one third of their total revenues to research to ensure that the company is always on the course of change and development. The benefit of using Kotters models is that it is easy to follow hence leaders may not easily get lost while using it. This model concentrates on the process of change hence it makes the transition easier for the organization. This model deals with cultural changes hence helps an organization operate well in the new environment when they are dealing with step 8. The first two steps in this model involve preparing change process by building a sense of urgency in order to generate a guiding action. The limitation of this method is that it is a rigid approach since the management sequence needs to be followed systematically in all sequences to achieve tangible results. Lewin Change Models Unfreeze This process is evident in Biogen Idec Inc since they involved in preparing the members of the organization for the change itself by making them realize that change is necessary. This phase involves breaking the status quo before building the new approach of functioning by sensitizing the concerned stakeholders that the prevailing mode of doing business should not continue (Hayer, 2010). In some cases, it involves pointing the diminishing sales numbers, poor business results, augmented competition, and unsatisfied customers support the rational for the change (Edwards, 2005). The management of Biogen Idec Inc has realized that in order for them to increase the efficiency of the company, they have to restructure their operations to be in line with the market demands. The management is involved in conducting research on various markets to expand their business capability. Change This phase involves resolving to the uncertainty by looking for new ways of doing things after people have accepted the need for change. The research conducted by this company enables them to see clearly the new ways of doing this in order to effect the changes necessary. People take time to initiate the changes and therefore time and communication are important aspects of this process (Beer & Norhria, 2000). Biogen Idec Inc initiated changes in the company by establishing three centers of excellence by moving commercial and administrative functions to Switzerland, regulations to the UK and logistics to Holland. The company also resolved to grow its direct presence in emerging markets by avoiding operating through distributors in Latin America. Refreezing It involves the process of ensuring that the improvements have stuck and people, structure, and other change elements are okay. In the case of Biogen Iden Inc, the company decided to allocate additional resources on local level to support the changes while at the same time reducing resources at the international level. The leadership of Biogen Idec Inc ensured that their organization does not return to its old ways by properly reinforcing changes. This company also ensured that there is a balance between company costs and benefits and employee costs and benefits. The benefit of using this method is that it's simple and easily followed through the three simple steps during a change in the organization. The disadvantage of this model comes at refreezing stage since the employees are worried of another change coming and this shock may reduce their effectiveness regarding their work. This model is mainly applicable to timely changes hence only reliable when use in small sized organization. Prosci Change model This change management methodology is based a wide research for several years and its reliable since it comes from real project leaders and teams (Aaron & Elizabeth, 2012). The application of this model is evident in Biogen Idec Inc since both organization and individuals participated in change management. The change team at Biogen Idec Inc realized that the employees are the important components of change and this is the reason why the involved their representatives in all discussions relating to change. Biogen Idec Inc Company consulted employees on current and future organization structure and provided them with a detailed analysis of how it would affect their lives; this is to facilitate their employees’ acceptance of the change. Organizational change management requires proper understanding of what tools are at their disposal so that individuals can successfully affect the changes using them (Krogerus & Tschappeler, 2013). Leaders prefer this method to others since it is research based hence reliable in effecting changes that have potential benefits to the organization. This method is also advantageous since the process is holistic and easy to apply and the approach is geared towards competency building. This method is limited by the fact that it has no guidelines and steps that can followed in effecting changes to the organization. Leadership theories Transactional/Transformational leadership theory A good collaboration is evident between employees and their leaders in Biogen Idec Inc since both are involved in decision making. In transformational leadership, there is collaboration in the sense that both leadership and their followers raise one another in the course of their duties (French, Bell & Zawacki, 2005). Keegan and Hartog 2004 argue that this kind of leadership seeks a redefinition of a personal mission and vision by renewing their commitment and restructuring their systems to achieve their goals while taking care of the welfare of their workers. Biogen Idec Inc ensured that rigorous change process is both company and employee rights centered to ensure that everybody is happy about the changes being effected. Contingency leadership theory Julie and Tiziana (2012) explain that the success a leader is the function of various contingencies that takes the form of subordinates, task and group variables within the organization. The efficacy of a leader according to contingency theory is subject upon the demands enforced by the circumstances hence a leader is thus expected to use a different style of leadership depending on the situation and circumstance. The management of Biogen Idec Inc conducts research before embarking on the real change to ensure that all their moves fit within their demands. Contingency theory thus demands that no leadership style can fit all situations and the success of any type of leadership depends on the environment in which that particular leadership is applied. The management of Bigen Idec Inc ensured that they distributed the functions of management with regard to market research to maximize the productivity of the company. Followership leadership theory Leaders influence their subordinated to achieve certain goals and objectives of the organization in this social influence process (Collinson, 2006). Leadership is highly linked with the follower and vice versa and the success of the other depends on the efforts of both of them (Lord & Brown, 2004; Agnes, 2010). The leaders of Biogen Idec Inc initiated a change after conducting market research and ensured that they involved employees in effecting the changes they needed to make the organization a success. The leadership of Biogen Idec Inc appointed a team to conduct a reassessment of their business strategy, a demonstration of followership leadership theory. Leadership in change management The leaders at Biogen Idec Inc ensured that they supported all the processes by providing capital and distributing funds to local branches to support their change initiatives, a demonstration that leaders are sponsors of change (Gilley, 2005). The leaders should be the decision makers in the organization by controlling resources, budgets and equipment to facilitate the change process (Styhre, 2002; Hayes, 2010). Communication is an important aspect of change and this is why the company structure of Biogen Idec Inc reorganized their company structure to facilitate communication (Lord & Brown, 2004; Hiatt, 2006). In order to increase the morale of the workers, leaders act as the motivator in creating a sense of urgency and incorporating their employees in all decisions regarding change as the case of Biogen Idec Inc. Real life example of organization change A good example in implementing organizational change is evident in the case of Health Care Management as presented by Campbell (2008). After carrying all the initial phases, the management realized that implementation and sustaining the change is a very important phase that must be handled with a lot of care. The management ensured that the short term wins might make people believe that they have accomplished their goals and lose their sense of urgency. Health Care Organization ensured that despite implementing electronic health records, nobody stood around to congratulating themselves. Employees were required to provide the patients with the ability to create personal health records, make appointments, and view laboratory results in order to re-energize the group and drive up the sense of urgency (Campbell, 2008). The leadership of this organization developed a special team called the red coats that were extensively trained and were responsible in solving problems that may arise due to the new system. The redcoats would investigate problems within the new system and determine whether the problem is a system or user related in order to determine the best way of dealing with it. In this health care organization, they ensured that culture change comes last in order to make the change stick. In order to adopt a new technological change, the leadership of this organization had to first prove that the technology works and reward enthusiastic employees in the change process. To make the change stick, a practice called post live was formulated to and sent on rounds to make more efficient use of new technology and incorporate it into the organizational culture. These initiatives were very successful in implementing electronic health care change to this hospital (Campbell, 2008). Bibliography Aaron, S., J, L & Elizabeth, H. 2012. Developing better change agents. McKinsey Quarterly. Issue 2, p98-104.  Beer, M & Nohria, N 2000, ‘Cracking the code of change’, Harvard Business Review, vol. 98, no. 3, pp. 133–141. Burnes, B & Jackson, P 2011, ‘Success and failure in organizational change: An explanation of the role of values’, Journal of Change Management, vol. 11, no. 2, pp. 133-162. Charlton, B. G., & Andras, P. 2004. 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