Managing Organisational Change - Nature and Need for Change - Coursework Example

Change Management report Customer Inserts His/Her Name Customer Inserts Grade Course Customer Inserts Tutor’s Name Introduction Change is inevitable in every business enterprise considering the very dynamic nature of the environment affecting organisation and the ultimate goal of striving to achieve goals. Forces within and outside the organisation both visible and invisible are the usual drivers that will result in change. Change can be planned or unplanned. It can be exceptional change, incremental, pendulum, paradigm and pragmatic where there are clearly defined goals and processes that will facilitate the achievement of those goals. At Nestle change has always been focussed and conscious as clearly indicated in the various change instances that have defined the global giant in food manufacturing. With the change drivers of growth, leadership and management, productivity goals, product distribution, effective and efficient production systems and financial returns to the shareholders, Nestle has been able to overcome most challenges through a resilient and determined management team that focused mostly on long terms of the organisation. Nature and need for change Change relates to the process of in different status other that the current state. According to Boonstra & Thomas (2004), change in organisations occurs due to different forces both visible and invisible; consequently for the organisation to be relevant to their going concern goals, it has to change. The most common forces of change are; 1. Technology This involves changes in tools, instruments, methods and procedures of trade used in organisations. With changes mostly in the customers’ needs, consequent changes in technology have been very inevitable. 2. Work force Work force and human capital are some of the key elements in an organisation critical for achievement of most goals and change goals, changes related to workforce especially in their knowledge and skills requirements, ambitions and job expectations are unavoidable. 3. Economy Economic environment has been a major dynamic force driving changes in most organisations. Globalisation, economic liberalisation and privatisation in most economies have resulted in the changes in business environment has major impacts on the organisations and consequently changes will be necessary. 4. Competition Competitive environment where most organisations like Nestle operate and especially food industry, where competition is stiff requires changes that may be as result of; mergers, acquisitions, entry of new entrants, new products, low prices and better customer services. International competition for Nestle has be their driving for divestures and strategic acquisitions. 5. Financial Need for improvement for the financial stability in an organisation will always result in changes that will touch on financing strategies, revenues and budgetary and planning strategies. Organisations change differently relative to a similar force of change and therefore the nature of change varies (Chorafas 2001). Some changes occur naturally and gradually while others are deliberate actions by the management of any institution. Change therefore can be; Evolution This change occurs not necessarily with the preparedness or willingness of the people involved but naturally and gradually in small adjustments or drifts in response to emerging challenges in the society. Revolution This happens when people reach a state of readiness for change and the undecided will be coerced into agreement and ultimately change is achieved. Planned change When there are deliberate efforts to make people in an institution to experience the need for change by deciding on the ideal desired vision and the planned actions necessary the achievement of this goal, this is constitutes a planned change. Change targets Change targets constitute the major components for change goals in an organisation and they include the following; a) Vision, mission task and goal b) Structure c) Strategy d) Systems, procedures and technology e) Organisation values f) Management styles g) Culture h) Human capital knowledge and skills, attitudes and values Proposed change strategies that can be reasonably be considered by Nestle Nestles’ rich history of transformation and change management is one the greatest assets that it has with regards to change management. With this in mind Nestles’ approach to change is pragmatic as it endeavours to achieve a pre-planned goals using an elaborate action plans. Change management is associated with various strategies depending on the nature of the organisation and vision of the desired goals. In a nutshell change process always is a movement from a current status to a desired vision status as depicted in the diagram below irrespective of strategy applied (Jeanemel 2000). Organisations will apply various strategies to change depending on its fundamental structure that will determine whether the desired goals will be achieved. Below are a list of various change strategies and a summary statement on its relevance to the situation in Nestle. Fellowship strategy This strategy is based on interrelations between individuals in an institution to bring about change as it stresses much of developing friendships hence change will happened with less resistance. This strategy is relevant to Nestle and other organisations as failure to recognise the value of human capital in change process can make the process fail. Political strategy This strategy to change is centred on power centre and leadership of an institution whether formal or informal. It involves a scenario where when most influential people have agreed on something to be done, it has to be done. This strategy assumes that leadership influence to change, whether formal or informal by opinion leaders, has a significant impact in creating change (Boonstra & Thomas 2004). Nestles’ leadership has been in the forefront in driving change but they have had a supportive team of manpower. Economic strategy This strategy to change stresses on the need for the financial muscle to cause change especially acquisition and control of market resources are the desired goals. The strategy requires to be integrated with other strategies in order to cause change therefore Nestles’ financial budget for acquisition has not be the only significant driver for change Academic strategy This is based on the assumptions that people are rational and where enough facts pointing to the necessity of change are shared to them, consequently they will change. This strategy further stresses the need for in-depth research into the organisations’ need for change and their required action plans. The research process will provide facts that will give people the right information with regards to change. Nestle being a global institution requires this aspect of academic strategy to change so as to engage its various members in a pragmatic change where there are measurable metrics for performance. Engineering strategy This strategy to change involves changing the environment where people are consequently changing them indirectly in order to adopt to change. This strategy is not people centred consequently cannot be applied alone. Though changes in the environment may necessary in organisational change, it imperative the people are informed. Military and confrontational strategies These strategies apply physical force and conflict in order to make people change. They may be relevant in institutions like the army, police and other discipline forces but not the Nestle Applied behavioural science model This is where all the people affected by change have a very critical stake and decision with regards to the change process. The essence of this model will be to incorporate all the strategies and means that will allow for the whole group to make a decision with regards to change. Nestle change strategy Change has been synonymous to Nestle as a corporate global giant in food manufacturing for over a century. The company has been successful since it has appreciated the value change bring into organisations. Change in Nestle has revolved around moving the organisations human capital, production, growth, efficiency levels, financial health, culture and technology to the desired vision through adherence to the identified strategies, structure and processes. To be specific change in Nestle has seen the organisation transform from a local industry to a global food manufacturing giant over a series of various change periods which involved strategic investments and acquisitions and divestures. Nestle has been able to maintain consistence with change as its key ingredient to their success. Sustainable change that defined Nestle has been associated with the company’s resilience to always provide a way out of the various situations they have been through. In the event of low profitability for example, Nestle was able to have strategic divestures and investments without losing sight of their long term strategies. Nestle has also avoided the use of quick fix solutions but instead relied on their belief that it is a company of the future. Sustainable and successful change experience in Nestle has been attributed to the use of ADKAR Model where the whole organization change had a deliberate process to achieve a given desired goal. ADKAR Model as applied in Nestle has been the core foundation to a sustainable and continuous transformation in Nestle that has enabled the company to stay ahead of competition for a long time (Cummings & Worley 2008). The Nestle change Model has four phases where the fourth one is organisational analysis that gives the company an option to have inbuilt resilience through timely identification and understanding of problems and change drivers. The model is as shown below Organisation Analysis This involves the understanding of the organisation current state of affairs in details. It includes the understanding of culture, systems, procedures, management practises and readiness to change. The internal and external environment has to be understood while not forgetting on the work force morale, motivation and rewards systems and leadership styles (Charles & Gareth 2010). This understanding of the organisation is very critical to the development of the right actions to cause change. Designed change intervention This is one of the most critical responsibilities to the organisation leadership where leadership skills are highly engaged without compromising on the participation of all the members of the organisation. This stage involves the development of the desired vision state of the organisation consequently making it critical that a winning overall organisation team is prepared through initiatives will have a desired shared organisation vision clearly understood by all the stakeholders. Interactive sessions through workshops, team meetings and presentations are necessary communication and team building strategies required (Leban, Klein & Stone 2005). Nestle has been able to perfect this stage through development of leadership program where all its global management teams are trained on the shared organisation change practises and culture. Planning the change This involves the development of the change or transformation action plan that will ensure that the organisation achieves the desired goals. Without proper understanding of the organisation state of affairs and the desired vision state, planning for change will be a futile process. Consequently, it is imperative that planning for change is not a process to be undertaking by outsiders or consultants. Implementation This stage involves the execution of change action plan and is the most critical stage where transformation and change management skills needs to be imparted to the various change champions within the institution. The leadership training on effective change management is necessary so that as to reduce the forces of resistance to change through proactive people management skills. Management of negative perceptions about the desired vision state of the institution by some of the staff members and other forces against change needs to be managed so that it might not impede on the implementation of change. Challenges while initiating change and relevant management strategies Change is inevitable in every organisation and consequently the challenges associated to change cannot be wished away. Management have to put in place a strategy to counter these challenges and ensure a successful change process as proposed in the Force Field analysis diagram using Kurt Lewin’s Force Field Analysis technique (Kaplan & Benson 2000). This will give the management a powerful indication of where to devote their energies most. The model of managing change clearly identifies the following challenges to change in the institution; Work force resistance Employees might resist change giving their reasons as to mostly fear of the unknown as compared to the status quo. Individuals resistance to change is not always negative to the whole process of change but rather may be enhancing full awareness and ensuring that the desired vision is not harmful to the work force interest. Individual resistance can always be associated with mistrust between employees and management, punishments and rewards alteration, need for reward, recognition or respect and fear of losses especially monetary losses. Other individual areas of resistance to change are as listed below; Selective perception Fear of the unknown Lack of information Hostility towards the initiator to change Fewer resources Change in some instances requires the use of various resources which in most case are in low supply. To implement changes touching on acquisitions, purchase of new technologies and alteration in organisation structure requires use of resources that may not be adequately available. Union resistance Employee union has always been one of the critical stakeholders to change in an organisation but with competing interest with the organization management (Burnes 2003). Their interest will always be short term and oriented in maximizing employee returns consequently always becoming an impediment where employee support is required since they will always view it an opportunity to renegotiate their terms. Continuous change Nestle employees have witnessed continuous change. In some scenarios this can be a source of resistance in that employees will perceive it as a discomfort at work since their way of doing things will have to change. The model further proposed the various solutions to countering resistance to change so as to ensure proper implementation of change action plans. The proposed remedies to counter forces of resistant to change are; Strong support from the management and board of directors Incentive program on achievement of desired vision Help from vendor Customer needs and demands Legislative sanctions Drivers for change Desired Vision state or the current state of affairs Resisters for change Strong support from management Mistrust amongst mangers and employers Incentive program Worn out by constant change Help from vendors Union resistance Customer demands Poor communication channels Legislative sanctions Low resources Table 1. Force Field analysis diagram Effective change management process Change management process is very critical since it can cause failure to the whole need and process for change within an organisation. Successful change process will always be as a result of convergence between the business need for change and awareness on the side of the employees on the need (Vikas 2010). Effective change management strategies vary but the common ones that are universally applied include the following; Communication Effective change in organisations requires communication across all the levels of management and employees on the objective, scope, timing, individual and organisational implications and the cost of change. The change methods and the opportunity cost of change should also be clearly elaborated to all the stakeholders. The success of Nestle has much to do with the communication where senior management globally managing the operations of Nestle have always been briefed before change is undertaken. Burnes (2003) states that communication during change process is not a static routine rather there should be room for effective communication across all change stakeholders in an institution. Education and training Education and training may be a way of communication about change but its main aim is to bring about consciousness and informed decision making during change. Education and training will touch on areas to do with desired environment, organisation analysis, technical and functional planning and action planning. Participation and involvement Stakeholders to the change process should be involved from the initiation to conclusion of the change process. This will ensure that the desired shared vision is an organisation wide agenda consequently reducing resistance to change (Palmer, Dunford & Akin 2008). Facilitation and support Change champions are constantly required in transition process so as to give guidance to all the stakeholders in the change process. This will ensure achievement of the desired targets while all the stakeholders’ hopes are focussed on the desired goals not risks of transition. Negotiation Where there are conflicting interest and tendencies to resistance are growing, negotiations on an agreeable solution is encouraged so as to ensure that change process is not stalled. Compromises arrived at during negotiations must not water down the need for change and desired goals but rather reduce resistance. Co-opting This is relevant where there are desirable roles expected amongst the human capital group, this will involve assigning one key individual member that desired role consequently making influential amongst the team members. Co-opted individual becomes the key resource Conclusion The decision to transform into a leading global corporate enterprise by Nestle is not only major change but radical. It demands significant changes in governance, management and staff roles and responsibilities. All these imply a paradigm shift in the thinking, operational and financial processes, organizational culture and relationships among employees and other stakeholders. Nestle sustainable transformation implies the fundamental underlying philosophy where change takes place affecting all other aspects of operations. These changes require full commitment, consideration and appreciation by the Board, senior management and the entire staff before embarking on the process of transformation. In addition Nestle recognizes that the implementation of these strategic changes requires close collaboration with all the stakeholders. References Boonstra, JJ & Thomas, C 2004. Dynamics of Organization Change and learning, John Wiley, Cengage, Australia. Burnes, B 2003, Managing Change: A strategic approach to organizational dynamics, Financial Times. Pitman Publishing, New York, USA Charles, WL & Gareth RJ 2010, Strategy management: An integrated Approach. South Western, Cengage Learning, Australia. Chorafas, D 2001, Implementing and auditing the internal control system. Palgrave Macmillan, New York, USA. Cummings, TG & Worley, CG 2008, Organization development & change, Cengage Learning, Melbourne. Jeanemel L 2000, Changing the way we change,-gaining control of major operation change, Pitman Publishing, New York, USA John Wiley & Sons, Greenwich. Kaplan TF & Benson AF 2000, The human resources role in managing organization change, FPMI Communications, Canberra. Leban, B, Klein, A, & Stone, RA 2005, Managing Organizational Change, Palmer, I, Dunford, R, & Akin, G 2008, Managing Organizational Change: A Multiple Perspectives Approach, McGraw-Hill Higher Education, New York Vikas, K 2010, ‘JIT Based Quality Management: Concepts and Implications’, International Journal of Engineering Science and Technology, vol. 2, no. 1, pp. 40–50. Read More