Change Management and Cultural Transformation for CF&F - Case Study Example

Change Management and Cultural Transformation for CF&F According to Hellriegel, Slocum, Woodman in Organizational Behavior (2001), "Motivation represents the forces acting on or within a person that cause the person to behave in a specific, goal-directed manner...Because the work motives of employees affect their productivity; one of management's jobs is to channel employee motivation effectively toward achieving organizational goals." In other words, motivation is the key to success in any organization. Management of an organization has the duty to both motivate its employees through daily tasks, and motivate its staff to produce at its most effective levels. Like many companies which grew to a level of success and significant market dominance during the decades since the last world war, the ideas of company culture was largely ignored, yet it drove the company, and carried the entire industrial sector of the economy. Post WWII, the concepts of mass production, economy and scale, and uniform production methods brought businesses to leadership in their respective fields. During these years the labor pool was made up most significantly of men who learned to be successful by following orders and following through until they were told differently. This is a mindset which created an effective military machine, and brought economic success back to their home country. However, today's labor pool is significantly different. The workers are educated, and have been taught to think as well as work. Today's workers want to know, and to some extent feel connected to the 'why' behind their tasks as well as the 'what' of their daily tasks. To a great extent, these workers no longer hold to the ideals of the previous generation, and are no longer motivated to work for a secure paycheck, and a 30 year career path. Today's workers are looking for an emotional connection, or what researchers call a psychological contract (Clair et. al, 2001) between themselves and their employers in order to feel personally connected to their position. Hence, business a usual, expecting workers to be satisfied by following orders and completing tasks, is no longer a corporate culture which will build a successful organization. CF&F may not yet realize the problems for which it is headed. Surrounded by a corporate culture which has successfully built the organization, the CEO, board and other top executives may not yet be aware of the extent to which the employee dissatisfaction can undermine the organization. We could say that the organization must tame the unruly beast of employee unrest before it begins to negatively affect production, quality, and profits. The company needs to tame the problem before the organization begins to suffer profit decay due to increased costs associated with increased turnover. The following recommendations will use the acronym T.A.M.E. to form a recommendation for change. For the duration of this recommendation, T.A.M.E. stands for: Transformation of the company culture by training upper and middle management in transformational leadership. Authority disbursement from the hands of the upper management to the department heads and workers. Mentoring transformational leaders at every level. They will learn within a measured level of accountability how to lead and transform those under them Empowerment of each department to control their immediate environment and business variables in order to maximize efficiency, and employee moral. Basis for the recommendation Tom Peters and Robert Waterman published Mc Kinney's 7-S Model in their article "Structure Is Not Organization" (1980) and in "In Search of Excellence" (1982). The model starts on the premise that an organization is not just structure, but consists of seven elements: Those seven elements are differentiated into so called hard S's and soft S's. The hard elements (green circles) are feasible and easy to identify. They can typically be found in strategy statements, corporate plans, and organizational charts. The four soft S's however, are less quantifiable. Capabilities, values and elements of corporate culture are slowly developed, often without the direct attention of those contributing to them. Although the soft factors are below the surface, they have a great impact of the hard structures, strategies and systems of the organization. Most corporations focus on the hard S's when discussing change. Those leading the organization want to change those items which are manageable, controllable, and measurable from the top down. This approach does not lead the company into the emotionally unsettling idea of de-centralizing authority into the hands of lower level workers. However, it is precisely the decentralizing which is required by CF&F in order to transform the authoritarian management style into a worker friendly environment. The change required in order to transform the organizational culture is contained in the soft S's, the skill sets, the shared values, the staff and the leadership style. According to Chandler, "before 1850, very few businesses needed the services of a full time administrator or required a clearly defines administrative structure. Industrial enterprises were very small, in comparison to those today. And they were usually family affairs. The two or three men responsible for the destiny of a single enterprise handle all its basic activities. - economic, administrative, operational and entrepreneurial." (Chandler, p. 19) Keeping track of the details was a matter of sitting around the dinner table after the lights in the shop were turned off, and talking over the day's business triumphs and struggles. The family knew every aspect of the company's progress, and the key people also knew each other well, and could interact on a personal level which helped keep the entire enterprise accountable to their ultimate goals. Chandler's describes the interaction between the hard and soft S's in these terms. Like a Mbius loop, the strategy and the structure drive the culture, while the culture in turn drives the strategy of an organization. Therefore the layering of management and the span of control become crucial to maintaining in touch with and in control over the details, including cultural issues of business Today's CEO's and executive boards often approach their business from the same familial mindset. They want to control and know the hard S details. However, CF&F must address the soft S's, and give the responsibility for some of the hard S's to those who know the details and work with them every day. Then the leadership can free their own personal resources to address vision, transformation, and organizational cultural issues. Transforming Management to Transform a Company The first step is to put the managerial staff of the Tech unit through the Multifactor Leadership Questionnaire (MLQ) (Bass, 1998). This test has excellent validity and reliability, and has been used extensively worldwide. It has proven to be strongly predictive of leadership performance across a broad range of organizations. Once the leader and raters have completed the MLQ, their responses are collated in a well designed, easy to read, extensive and confidential report that enables leaders to understand their scores. The MLQ has become a research standard over the past decade, because it has accurately identified that among the leadership styles, transformational leaders were found to generate higher commitment from followers in numerous studies This study will teach and instruct the existing leaders as to their personal leadership style. Transformational leaders are those who guide followers in the direction of established goals by clarifying role and task requirements. Transformational leaders, who are charismatic and visionary, can often inspire followers to transcend their own self-interest for the good of the organization. Transactional leaders hold a view of their tasks as a transactional process whereby leaders respond to subordinates' basic lower level and security needs Transactional leaders and subordinates may be viewed as bargaining agents whose relative power regulates an exchange process as benefits are issued and received. Laissez-Faire Leaders exercises little control over his / her group, leaving them to sort out their roles and tackle their work, without participating in this process himself. This approach often leaves the team floundering with little direction or motivation. The MLQ will give the Tech management the training and tools they need to learn the transformational leadership mindset, which will empower them to begin the cultural transformation within the Tech unit. Handing off Authority through mentoring The transformational leader is a person who is: Idealized: focused on attributes, attitudes as well as the behaviors of his staff. Inspirational: motivates the staff from within, rather than control from without. Intellectual: seeks to stimulate his staff with new theories, and opportunities, breaks from the routine, and by accepting input from his personnel. Individualized: individually considerations the needs, talents, and desires of the organization, and works toward fitting the pieces into the position most suitable for them, rather than forcing the person to fit into the position. This paradigm views leadership seeks to move followers beyond their self-interests for the good of the group, organization, or society by a transformational leader. Barling, Weber and Kelloway (1996) completed a field experiment with 20 managers trained in transformational leadership and compared them to control groups. They found positive training effects, especially on the managers' intellectual stimulation. Followers' commitments and financial performance also increased as consequences of their managers' training to be more transformational in their leadership style. Thus, the transformational leader seeks to move decision making authority into his followers hands, while at the same time teaching them the imprinting in them vision of the company. The combination of these relational elements will transform the workers attitudes. The worker becomes a part of the organization rather than a cog in the wheel. The worker can make an emotional connection to the why of the business, thus giving meaning to the 'what' of the daily tasks. Empowering the change. After giving authority and vision into the workers hands, the need will arise to develop new organizational structures, systems and strategies so that the workers have the tools at hand to carry out the company vision and their daily tasks. This transformation can crash and burn if, after the employees are given a vision, and told they are an important part of the company, they are not given the resources and decision making authority to carry out their newly learned ideas. The company must have enough faith in the workers to divest control while maintaining oversight and accountability. Then, and only then, will the cultural transformation which began with the leadership take root in across the employee population, and create a more successful organization. Works Cited Bass, B. (1998) Transformational Leadership: Industrial, Military, and Educational Impact. New Jersey: Lawrence Erlbaum Associates. Barling, J., Weber, T., & Kelloway, K. E. (1996). Effects of transformational leadership training on attitudinal and financial outcomes. A field experiment. Journal of Applied Psychology, 81, 827-832. Chandler, Alfred Jr. (1962) Strategy and Structure: Chapters in the history of the American Industrial Enterprise. Cambridge, MA: MIT Press. Claire, E., Kickul, J., Lester, S. (2001) Psychological Contracts in the 21st Century: What Employees Value Most and How Well Organizations Are Responding to These Expectations. Human Resource Planning, Vol. 24. Hellriegel, Slocum & Woodman (2001). Organization Behavior (9th ed.). Ohio: South-Western College Publishing. Peters, T., Waterman, R. (1982) "In Search of Excellence", New York, London: Harper & Row. Waterman, R. Jr., Peters, T. and Phillips, J.R.( 1980) "Structure Is Not Organisation" in Business Horizons, 23,3 June. 14-26. Read More