Management of Change - Zippy Insurance Ltd - Case Study Example

Management of Change Introduction Planned change is an intentional attempt to attain specific goals and objectives. In the planned change process, some objectives are determined initially and after their determination, subsequent strategy along with a series of steps is devised to attain these objectives (Cummings and Worley, 2009). In this regard, clarity of objective is highly essential because without this clarity, the subsequent action strategy will be meaningless. However, external pressure, resistance and reluctance are some of those factors that always challenge the process of planned change and the even the change agent will find it hard to overcome them. In the following parts, background case study information has been provided in which the theme and supporting issues have been highlighted. In this part, those key steps which invalidated the planned change process have been specified. Through this particular identification, the application of Lewin’s three step change model process has been tested in which all three steps have been summarised along with the necessary steps that should have been taken have also been mentioned (Gilley, 2005). Case study- Zippy Insurance Ltd Zippy Insurance Ltd has attempted to introduce planned change in their current business operations. Currently, the company is using manual methods and non-virtual ways to deal with the queries and claims of the company clients. For the sake of increasing their business operations to the national level, the company intends to revamp its current system by totally switching to virtual or electronic selling in which all business operations including, queries, information, feedback, claims, communications and other types of business activities will be transferred to a software-based system. Additionally, this move is mainly considered for reducing the business cost so that the overall profitability of company operations and performance is enhanced. In order to introduce and implement the different elements of planned change, the board of directors and finance directors decided to lead and introduce change in the business operations. For this purpose, they sent only emails to the intended employees and they were also given one hour training program for getting familiarized with the new system of operations. Consequently, as many employees were not informed in a proper way and their opinion was not taken into account, dissatisfaction, de-motivation, morale decrease, absenteeism, customer dissatisfaction, low inclination for voluntarily accepting job assignments were started to appearing and this situation brought loss to the company as the firm was losing customer trust and confidence and consequently their business as well. These signs can also be represented through growing tendency of absenteeism in employees (Furnham, 1992). Lewin’s 3 three change model Kurt Lewin has proposed a change model based on three steps: unfreezing, moving and refreezing (Gilley, 2005; Cummings and Worley, 2009). Lewin reflects that the change cannot be sudden but is like a process which is based on certain steps essential to obtain the objectives of planned or intended change (Pathak, 2011). And this change process is mainly implemented by taking into account the organizational factors for enforcing change (Liu et al., 2011). In the first step, Lewin suggests that the existing forces should be minimized and this process is achieved through ‘psychological disconfirmation’ in which the current behaviours, methods, attitudes are discouraged and avoided as well (Cummings and Worley, 2009). In other words, the current ways (i.e. old behaviours) should be discarded and so that a vacuum is created (Albjorn and Haug, 2010). For this purpose, Lewin emphasises that the change should not only come from top, but it should be initiated from top, bottom and from the middle as well (Burke et al., 2009). Consequently, the planned change should be a continuous and straightforward as well (Griffin and Moorhead, 2010). Zippy Insurance Ltd should have availed and implemented the Lewin’s three step model. In the first stage, the board should not have taken the decisions without taking onboard the key department heads and employees as well; the board should have arranged and conducted a vertical communication in which face to face meetings and gatherings should have been arranged with employees. In this stage, the board should have adopted a two-way strategy in which they should have given opportunity to the employees to exchange their concerns or reservations regarding the new system and they could have been asked to provide their suggestions and recommendations pertaining to the new system. By doing so, the entire process of planned change should have become more inclusive in which say and participation of all or important employees would have included and that could have become a constructive support to the proposed planned change in the company. At the same time, in this stage, the board and the finance directors should have met individually with the resisting or reluctant employees; through this face to face contact, they would have become able to hear and understand their point of view regarding this proposed planned change in the company’s main business operations. And for this, employee participation is of crucial importance (Wilton, 2011). And, in the first step, importance of change urgency, which is the first step of kotte’s eight step model, has been emphasised by highlighting the pros and cons of the proposed planned change besides attempting to diminishing anger, fear and complacency that discourage change from taking place (Kotter and Cohen, 2002). In the second step (moving), behaviour of employees or department is shifted to a new level in which certain steps are essential to highlighting the value and significance of new level and methods; and in this step, new processes and organisational structures for the planned change are introduced (Cumming and Worley, 2009). In the second step, the board should have offered and provided a comprehensive training and development sessions to all employees. In this regard, it is important to mention that one hour training was insufficient as the work of software was not easy for every employee. Instead, the company management should have chalked out a comprehensive trial period in which employees were allowed to work in both the current and new system; this approach would have provided confidence to appropriately switching from one system to another. At the same time, the department heads should have been asked to note down the progress of the training and development sessions. In addition, the board should have arranged sessions for ‘organizational change management’. In this step, the employees should have been made aware of the benefits of proposed change and their effects on their overall productivity and performance as well. And this can be incorporated into the appraisal system (DelPo, 2007). Zippy board should have used some steps of Kotter’s eight step change model. For example, the board should have asked the department heads for their role in effectively implementing the planned change. For example, the department heads should have been assigned to pinpoint the probable and potential hindrances in the process. For this purpose, they should have highlighted those employees who would resist and pose severe challenge to the planned change. For resolving the potential hindrances, the board should have allocated the task of devising strategy to manage their concerns and queries so that they could become a part of the planned change process. In addition, the department heads should have developed certain short term milestones so that the subsequent progress on the planned change should have been taken into account. Through devising and implementing the short term milestones, resistance from employees would have been minimized and their concerns would have been subsidised through the progress and attainment of short term milestones as mentioned in Kotter’s eight step model (Kinicki and Kreitner, 2009). Zippy Insurance Ltd should implement simultaneous application of both systems. In this strategy, old manual system and new software-based system should be applied collectively. Through this strategy, employees will have an opportunity to understand the different applications and methods of the new system. Additionally, this strategy should be applicable only for three months and the employees are advised and encouraged to avail this opportunity and adjust themselves with the new system within the provided timeframe. Consequently, this will create a sense of ownership and employee will actively participate in the process as employee participation enables employees to participate in important decisions (Lower, 2010). The board should introduce vertical communication strategy. In this strategy, the board should authorise the middle and bottom level management to easily interact and communicate with the top management. Through this mechanism, employees will have an opportunity to share their issues immediately with the top senior management and the relevant and necessary steps should be taken for overcoming the issue. For the vertical communication, the board should avail some steps mentioned in the Kotter’s eight step model (communication of vision and strategy) (Cameron and Green, 2004) Most importantly, employee participatory approach and strategy should be availed. Employees should be allowed to participate in important meetings and provide their assessment and feedback on business related issues. Additionally, the senior management should encourage them to provide their point of view on the issues. This policy has important implications for the company. First, the employees will feel a sense of ownership and they will be motivated and encouraged to actively work in the company and improve their productivity and performance as well. And for this objective, it is important to generate effective communication strategy as mentioned in the Kotter’s eight step model (Sabri et al., 2007). In the third step (refreezing), this step is referred as a stabilizer phase in which the new change is stabilised through supporting mechanism so as to attain the state of equilibrium within the organization (Cummings and Worely, 2009; Barling and Cooper, 2008). Additionally, this step is of the prime essence as it is the efficacy and efficiency of step that will solidify the change management introduced in the second step. For this purpose, following recommendations would be highly relevant to introduce and implement the planned change process in the second step: In the third step, the board should have offered reward and recognition to employees. Under this framework, certain incentives and offers could have been offered for encouraging and motivating employees to accept the new change and improve their performance and productivity. For this objective, the board should have offered bonus, pay increase, paid vacations or recognition awards based on performance are the some of the offers that could have been offered to the employees. Through these offers, even the reluctant employees would have been attracted and could have worked harder to avail the offers. Additionally, this step could have reduced absenteeism, employee dissatisfaction, could have increased morale and preference to work with the new system as research shows that incentives increase employee performance (Cameron and Pierce, 2002). At the same time, the department heads should have developed a communication strategy. In this communication strategy, interaction and feedback on daily basis should have obtained and the subsequent relevant and effective steps or remedies should have been taken as well (Sabri et al., 2007). Similarly, some empowerment should have also been provided to the employees. For example, they should have been authorised to use the manual method if they would find certain processes in the new system difficult. Furthermore, the board should have run both manual and new systems simultaneously even for a trail period. Through this exercise, many employees would have been authorised to use both systems but preference should have been given to the new one. As a result, the employee morale would have been controlled considerably. For this purpose, following recommendations would be effective to introduce and implement the planned change process in the third step: For effectively implementing the planned change, it is highly recommended that the board should introduce and implement reward system in which a range of incentives and offers should be incorporated. Importantly, incentives must be attached with the attainment of certain milestones and objectives, which is step recommended by Kotter (Biech, 2007). In other words, performance related incentives should be implemented as they have potential to attract and motivate employees for higher, better and effective performance in the company. At the same time, this system will increase positive and healthy competition among and between employees for achieving the milestones. Conclusion Zippy Insurance Limited should use Lewin’s three step model for the purpose of effectively implementing the planned change. For this objective, it is highly essential that the company should put in place some effective measures such as vertical communication and participatory approach. In the vertical communication process, the company’s senior management must interact with the middle level management so as to effectively implement the planned change. Additionally, the company should motivate the employees through participatory approach in which they should be given opportunity to provide their point of view concerning company issues. Through this measure, they will own company and will not feel sense of alienation in day to day affairs of the company. References Arlbjorn, J.S., & Haug, A. (2010). Business Process Optimization. Denmark: Academia. Barling, J., & Cooper, C.L. (Eds.). (2008). The SAGE Handbook of Organizational Behaviour: Volume one: Micro Perspectives. London: Sage. Biech, E. (2007). Thriving Through Change: A Leader’s Practical Guide to Change Mastery. Miami: American Society for Training and Development. Burke, W.W., Lake, D.G., & Paine, W. (Eds.). (2009). Organization Change: A Comprehensive Reader. California: Wiley. Cameron, E., & Green, M. (2004). Making Sense of Change Management: A Complete Guide to the Models, Tools, & Techniques of Organizational Change. London: Kogan Page. Cameron, J., & Pierce, D.W. (2002). Rewards and Intrinsic Motivation. United States: Information Age Publication. Cummings, T.G., & Worley, C.G. (2009). Organization Development and Change. 9th Edn. Ohio: South-Western Cengage Learning. DelPo, A.A. (2007). Performance Appraisal Handbook. 2nd edn. California: NOLO. Furnham, A. (1992). Personality at Work: The Role of Individual Differences in the Workplace. New York: Routledge. Gilley, A. (2005). The Manager As Change Leader. Connecticut: Greenwood Publishing. Griffin, R.W., & Moorhead, G. (2010). Organizational Behaviour: Managing People and Organizations. 9th edn. Ohio: South-Western. Kinicki, A., & Kreitner, R. (2009). Organizational Behaviour: Key Concepts, Skills & Best Practices. New York: Tata McGraw-Hill. Kotter, J.P., & Cohen, D.S. (2002). The Heart of Change: Real-Life Stories of How People Change Their Organizations. New York: Harvard Business Press. Liu, X., Akram, S., & Bouguettaya, A. (2011). Change Management for Semantic Web Services. New York: Springer. Lower, M. (2010). Employee Participation in Governance: A Legal and Ethical Analysis. Cambridge: Cambridge University Press. Pathak, H. (2011). Organisatioal Change. New Delhi: Pearson. Sabri, E.H., Gupta, A.P., & Beitler, M.A. (2007). Purchase Order Management Best Practices: Process, Technology, and Change Management. Florida: J. Ross Publishing. Wilton, N. 92011). An Introduction to Human Resource Management. London: SAGE. Read More