Change Management in Organization - Case Study Example

Change Management in organization Introduction Organizations are established with the main aim of fulfilling various identified needs that are outlined as the goals and objectives. The business environment is always very dynamic, something that requires businesses to adopt various approaches to guide it through the journey of excellence performance and effectiveness (Paul & Berry, 2013). Successful organizations are those that effectively monitor changes in the internal and external business environment, and devise various approaches to help it navigate through the various change processes. Across the social and economic circles, change has often been described as an essential process that is inevitable. This means that people and business organizations are on a continuous journey that requires them to experience various processes and practices consciously or unconsciously. In this case, business organizations are expected to be abreast of the changing factors that can affect their profitability and other management aspects. This paper examines the concept of change and how it can be used by organizations to create and enhance their effective performance and success. It focuses on a Chinese Company, Alibaba Holdings, which has navigated its path to reach its current levels of excellence in business performance. The company has recently been listed on the New York Stock exchange in a bid to remain competitive and enhance its market position (Lianna, Jessica & Ryan, 2014). Change and Organizational Management Currently, the pace by which globalization has been taking toll on businesses has quickened tremendously. Business executives and owners have been increasing their call for flexibility, agility and innovativeness from various business functions (Robertson, 2006). This development is aimed at positioning businesses strategically to tackle the rising challenges in competition and other factors in the external and internal environment. Amidst all these persistent calls, one thing has often been largely ignored, that is, organizations are creatively designed in order to search for competitive advantages that are sustainable. In addition, the fact that stability in business practices is just not desirable and effective, but attainable as well, has been an issue buried deeply in managerial psyche, but has been bolstered by periods of practice and theory (Christopher & Edward, 2006). It is important to understand that the popularity that is often associated with efforts for process improvement that range from overall quality management to various kinds of sigma provides are enough evidence for the enduring need for stability in modern organizations. In fact, these qualities are often brought about by financial markets. In this understanding, it is therefore not a surprise that many large organizations find it difficult to achieve their set expectations effectively (Kleijnen, 2014). One of the major problems faced by these organizations is that most of their efforts are often focused on developing various change models that are deemed effective; alternatively, they are also geared towards seeking approaches needed for prevailing over change. However, it is important to realize that even those models that seem advanced can often stumble when they meet organizational and management designs and practices that seem inherently anti-change respectively (Christopher & Edward, 2006). Alibaba Company has had good management models and structures that have have been flexible and accommodating change practices. The company has moved steadily to take advantage of the many opportunities that have existed in its market niche. From the time when it acquired and released its first online market place in 1998 to the time it managed to acquire UCWeb, the internet-based Chinese mobile in 2014. In as much as the actual price of the purchase was not disclosed, it is believed that deal was the greatest as far as the history of internet sector in china is concerned. Company Background Alibaba Holdings is a Chinese e-commerce company that performs various business activities including creation of web portals, business-to business online, a search engine tailor made for shopping and cloud computing services among others (Yu & Yan, 2014). The group was founded in 1999, when one of its founders Jack Ma created the Alibaba.com website. This was an online business-to-business portal that linked manufacturers in China to buyers in Europe and other overseas markets. By 2012, the company had achieved tremendous growth, with two of its online portals managing to handle about 1.1 trillion sales in average sales. The company runs most of its activities in the Chinese republic. By the time, the company was closing its fiscal year in 2014; its market value was being estimated at US$231 billion, which was after it launched a successful IPO on the Stock Exchange in New York. The launch of the IPO on the New York Stock exchange came after the company failed to secure a mutual agreement with financial regulators in Hong Kong (Lianna, Jessica & Ryan, 2014). It is believed that prior to the launch of the IPO in September last year - 2013; a twelve-month period of negotiations was carried out to ensure that period went on smoothly and successfully. The IPO’s pricing is said to have yielded US$21.8 billion, but the figure later rose to US$25 billion, something that made it the largest and most successful IPOs in the stock exchange history in New York. The Company’s Taobao is an online consumer-to-consumer portal similar in comparison to the e-bay.com. The portal currently has more than a million products and is ranked among the 20 company websites that are most visited worldwide. Currently, the company is looking forward to entering the Indian market with talks in progress over the planned development. Change Management lessons from Alibaba Holdings Limited Successful companies are those that have effective and successful strategies that enable it navigate through the business environment tackling various challenges and problems while identifying and exploiting various business opportunities along its path. Change management describes the approaches adopted by companies, other business organizations, teams and individuals in transitioning to their preferred future states. Change management can also be used to describe processes adopted in project management whereby various changes are often introduced to the project and adopted as standards of practice. Alibaba Holdings has managed to adopt various changes in its business practices in order to create and sustain its market share in the ever-competitive internet-based businesses (Picker & Chen, 2014). The company has transitioned effectively from the small Alibaba.com website that was designed by one of its founder to link businesspersons in China to their buyers in Europe and other markets overseas. These efforts and strategies adopted by the company can be attributed to effective company management practices that understand the dynamism of the business environment. Change has been the backbone of the company’s transformation; it has managed to change and establish different forms of customer-customer and business-to-business practices in a way to remodel itself and exploit business opportunities where its rivals have not identified the existing opportunities. Managing Change – The Blue Ocean Strategy One of the strategies that are adopted by companies in the process of managing competition and creating themselves competitive advantages and market position is the strategy of the blue oceans (Mauborgnee & Chan, 2014). One of the best ways that is thought to drive business profits up is avoiding the “red” oceans; here, red oceans refer to the business environment that is characterized by companies offering similar products in the market. While competing in the red oceans, companies create various efforts in order to do better than their rival companies do. These efforts involve creating various approaches and strategies that give companies a larger market share. However, as the markets become crowded with new businesses and old ones devising strategies to create and sustain their market share, the profits earned by business in these markets reduce gradually (Mauborgnee & Chan, 2014). One of the ways to avoid being caught in this trap is sailing in the “blue” ocean; these are new markers that are uncontested, hence they are largely unexploited. This strategy was the cornerstone of the success of Alibaba Holdings. Right from the time it was registered, the company has been identifying various market opportunities that have propelled it to its current correct success. The company found an unexploited market in the way manufacturers were dealing with their buyers in the overseas markets. This realization made it create the Alibaba.com website as a platform upon which manufacturers and other business people in china could meet and communicate with buyers in Europe and other overseas markets. The successes in this market niche made it adopt other opportunities to leverage its market and increase its profitability. This led to the development of various online-based services that enhanced economic and social welfare of its consumers across the world. The company managed to develop alipay, which is an online-based escrow payment service among many others. It is believed that the application of the blue ocean strategy in transforming business services and mode of operation does not base on the company’s existing technology. Most often, the technology needed to transition across different forms of company practices is initially present (Mauborgnee & Chan, 2014). In this case, emphasis is placed on the value that consumers want from the business practices. For instance, Alibaba holdings created the Alibaba.com during its launch in the internet business in order to create a service that added value to the way manufacturers were linking and interacting with their buyers in the overseas markets. In addition, market research other forms of analysis made the company to create the shopping guide portals so that consumers would have an easy time looking for goods and services in their Taobao portal which is a an market place similar to the United states e-bay among others. In this case, the company considers the value that its innovations are having on its consumers as opposed to investment in technologies that do not have significant value to its consumers. In order to have a successful blue ocean strategy, it is important that companies do not focus on the competition in the market; rather, emphasis is placed on development of a leap in the market for the customer and the business (Kock, Roodt & Veldsman, 2002). Alibaba have managed to create a web-based portal that fulfills the needs of all people, they have also managed to host more than a millions products on the same platform. This way, consumers do not have to navigate to other sites to look for their products and services; they can simply browse in the portal, make their product selection and make their purchases. Another approach that is advocated for in the “blue” ocean strategy is that of creating the market place. According to this strategy, companies are not to go looking for their “blue” oceans elsewhere; they generate them from the “red” oceans existing in the market place. This is often achieved through the creation of products that are distinct and unique from those already being offered in the market. Getting the results – the Congruence Models One of the most important steps by organizational leaders is to create change in an organization and follow it up to achieve the expected results. According to the congruence model, it is imperative for business executives and leaders to know that in designing and leading people in large-scale firms, they have to understand the performance and change dynamics that are characteristic of the particular enterprise (Wyman, 2011). When leaders do not have a clear comprehensive roadmap to enable them understand their people, they often end up facing myriad of challenges and issues that later affects the performance of their organizations. According to the congruence model for business owners and executives to understand effectively the need for change in their organizations, they have to first understand and think of their organizations systems that are made up of various basic elements as shown. Fig 1. Change process (Wyman 2011) The first important element inscribed in this model is the input, which has to draw from the organizations internal and external environment. Secondly, the model the use of a strategy that that translates its vision and mission into strategic decisions that decide the direction of the organization. Thirdly, the model talks of the output, which are the products brought to the market for consumers to have. This model has been applied effectively in the case of Alibaba holdings; the company executives have been strategic in the study and analysis of the business environment. They have managed to cite various needs that need to be fulfilled, they have processed ideas and decisions that have been applied to achieve them. The success the company has achieved has been a result of strategies that have been carefully designed and worked out. Most of the services that the company has created and offered have changed the value that their consumers have while interacting with the particular service. The congruence model enables business owners to design and create systems that enhance positive change in their organizations. The organization is often said to be in a transformation process; right from its creation, it has to transcend various paths, realizing opportunities and drawing strategies to address them effectively. Alibaba holdings has taken a long journey to reach it current levels of succcess, it has been strategic in identifying and exploiting various opportunities that are deemed successful and able to give the company competitive advantages. Fig 2. The change transformation process (Wyman 2011) Alibaba holdings provides a perfect example of how change in organizational management can be a good source of competitive advantages for establishing market position and successful performance in the organization. Conclusion In all systems of life, change is an innevitable process that has to be adhered to in order to achieve any levels of unprecedented growth and expansion. Organizations are expected to understand the strategies they require to create themselves competitive advantages and follow them through to achieve their successes (Rydell, Andersson & Hedlund, 2013). Alibaba holdings, through reliable and successful leadership has managed to hold a successful IPO on the New York Stock Exchange that is considered one of the most successful in the history of the money market. This is a bold step that would not have been achieved especially when regulators in Hong Kong failed to reach an agreement about the IPO. Knowing the need for a successful alternative, the company had to engage in a twelve-month planning process that culminated in the launch of the IPO on the New York stock market. In the near future, the company is destined for great heights considering the sound management structures and investment in people friendly strategies. The technological world is on a fast-paced growth lane that the company will be banking on order to realize other technologies that can enhance the value of its customers. It is therefore important to realize that the company has already created a “blue” ocean in which it is swimming alone References Christopher G. W & Edward E. L. (2006). Designing organizations that are designed to change. MIT Sloan Management Review. 48(1). 21-23 Mauborgnee R & Chan, K . (2014). Blue Ocean strategy. Retrieved from. < http://info.psu.edu.sa/psu/fnm/ymelhem/blue%20ocean%20str.v2.pdf> Kleijnen, J., et al (2014). Effective quality management requires a systematic approach and a flexible organizational culture: A qualitative study among academic staff. Quality in Higher Education, 20(1). 103-126. Kock, R., Roodt, G., & Veldsman, T. (2002). 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