Organization Change Management - Essay Example

Running Header: Organization Change Management Student’s Name: Instructor’s Name: Course Code: Date of Submission: Executive Summary Robert, et al (2008) states that living with change is a survival skill while mastering the change management is the key skill for 21st century. There are 3 stages of change identified by Kurt Lewin to be achieved in change management, which include; unfreezing the way people does things, directing the organization towards the desired direction and refreezing the organization so that it will operate in the desired way. Virgin Blue organization has opted to change because the business will no longer sustain itself with Leisure travelers. The reasons why the company is changing are market pressure, strategic refocusing and economic reasons. The company has opted for the Kotters change model, which highlights the steps in change management. Establishing a sense of urgency, forming a leading team, Developing a vision for change, communication of the vision and change strategy, removing obstacles, develop short term goals, building on the change and incorporating changes into organization culture. Change comes together with challenges, which delay change implementations to include resistance to change, lack of prioritization of resources and projects, failure to involve people in the change implementation, failure to address people’s fears and anxieties and ineffective leadership. Table of Contents Running Header: Organization Change Management 1 Student’s Name: 1 Executive Summary 2 Table of Contents 3 Reasons for virgin Blue’s Changes 5 1. Market pressure 5 2. Strategic refocusing 6 3. Economical reasons 6 First order change and second order change 6 Change Model 7 Step 1: Establishing a sense of urgency 7 Step 2: Creating a leading team 7 Stage 3: Developing a vision for change 8 Stage 4: Communication of the vision and change strategy 8 Step 5: Removing obstacles. 8 Step 6: Develop short-term goals 8 Step 7: Building on the change 9 Step 8: Incorporate the changes into the organization culture 9 Challenges of change 9 Resistance to change 9 Lack of prioritizing the resources and projects 11 Failure to involve the staff in the change 11 Failure to address people’s fears and anxieties through the way to change 11 Ineffective leadership 11 Conclusion 12 Recommendations 13 References 13 Dolphy, A & Jeffrey, G 2005,organization and transformation and e-business implementation, Journal of organization change management vol. 18 no.2 pp. 97 13 Introduction Change in an organization occurs when there is a felt need to shift from the current state to a desired future state (Anderson & Anderson, 2001). In today’s world, there is increased need for change in the organizations due to globalization, which has brought about increased market opportunities and growth in revenue. Change management is a process that aims at minimizing the impacts of change to workers. In Virgin Blue’s Company, there has been a compelling need to change. This is so because they want to incorporate the business class as the leisure travelers cannot sustain the business. The company has put up a number of changes to be expected within sometime to include; new uniforms, new lounges, new aircraft and new business class products. Virgin’s management ought to understand that the changes that they are putting in place is not the employees’ responsibility to manage this change. Scheineder (2006) states that, the sole responsibility of the employees is to work hard in implementing these changes. Reasons for virgin Blue’s Changes Organizations change because of driving forces that are either internal or external forces. These forces may be positive or negative in nature. John (2006) suggests that the external forces are due to economic, social or political stimuli. He continues to say that the internal forces are due to either organization’s management policies, procedures or systems. Virgin Blue Company has changed in order to incorporate the business class travelers in their airlines for the following reasons: 1. Market pressure Dolphey & Jeffrey (2005) argues that market pressures makes an organization to become more flexible and more adaptive in order to cope with the competition. Virgin’s company has in the recent witnessed a weak consumer attitude, which may have been brought about by change of taste of consumers in the services that they offer. This compels them to change in order to meet the customers’ demands for examples they are planning on invest in new business class products to attract business class travelers. The company would also want to do away with the uncertainty of the economic viability by incorporating the corporate travelers since the leisure travelling business is being adversely affected by the economy. 2. Strategic refocusing Refocusing is cutting off that which is not in consistence with the new strategy to be adopted in a changing organization. Virgin’s Blue Company has decided to phase out aircrafts that are uneconomical. They replaced the narrow body aircraft with the wide body.There are new uniforms for the staff, hence the old ones will be phased out, and there are new lounges with improved services to attract more corporate travelers. 3. Economical reasons This refers to the ups and the downs of the economy of a country that brings a direct impact in a business organization because of interest rates and also inflation (Watzlawick, 2006). The economic changes have a compelling need for the Virgin’s organization to change. The Leisure travelers are becoming uneconomical and this can no longer sustain this company. When the inflation is high the first things people would cut off is the leisure travelling and this makes the company have a drop in the interest rates. The company now wants to accommodate another class of travelers, which is less affected by the uncertainty of the economy. First order change and second order change Watzlawick (2006) stated that the first order is an incremental change which is aimed at improving the organization while the second order is a transformational change where the whole system is changed. Virgin’s company is undergoing first order change whereby the company is undergoing changes to improve its services so that it attracts many business customers. Change Model This change model is composed of eight steps stipulated by Kotter (2006) a renowned change expert and a professor in the Harvard school of Business. This is a model to be used in the stages of planning, implementation and in sustaining change. The change process is as follows: Step 1: Establishing a sense of urgency Kotter suggests that if people in the organization don’t feel the urgency of change, the momentum for change will probably disappear before reaching the finish line. To increase this urgency in Virgin’s company the management ought to examine the market and the competition within. There is market decline due to that the economy is poor hence decreased leisure travelers. This decrease in turn decreases the forecasted profits. They have also identified some opportunities where they can operate through low cost and incorporate the corporate travelers. Another opportunity is that Qantas is a monopoly whereas Virgin’s company has a 10% market hence have seen the need to tap this untapped opportunity. Step 2: Creating a leading team Kotter suggests that there has to be a team who are committed to lead. This team ought to pass information about change and also clarify any kinds of rumours about the change. Virgin Blue Company has involved a team of Runway Winner Juli Grbac to design the new uniform and give a new look to the company. This team is influential in that it won in the fashion show. The company has revealed the choice of turboprop aircraft for partnership with SkyWest to fly to regional routes. This team will also help in making the company realize its profit targets. Stage 3: Developing a vision for change Virgin’s vision is to become the best corporate travelers airline. They have put up a strategy to be able to reach this vision by building more spacious lounges with improved amenities, they have new uniforms for staff to give them a new improved look, new products and also they want to advertise their upcoming services on media. All these strategies are all geared to attracting more customers. Stage 4: Communication of the vision and change strategy The great ideas and the solutions should be put together and in simple and clear terms communicated to the team members. It worthwhile for Virgin’s Management to be open and be able to address employees fears and anxieties that may be heightened by the change. The new strategies and operations should all be directed to meeting the vision. Step 5: Removing obstacles. Virgin’s obstacles are those things or people that will hinder her company from reaching the desired vision. These obstacles delay the change and may hinder it from happening at all. Peoples resistance to change can be a great obstacle to change and this should be addressed and solution sought. Virgin’s company is doing away with uneconomical aircrafts and replacing them with ones that are more economical. Step 6: Develop short-term goals Success motivates the staff. It is wise for virgin to set up short term goals that are achievable within specified time limits. When a goal is reached, the staff sees that it is a reality and there’s increased energy towards reaching another goal. The CEO of Virgin’s Company announced that the wide body Airbus A330 aircraft that would operate between Sydney and Perth is to start in May. The staff will realize that the changes put in place are a reality and achievable. It is worth recognizing the people who have enabled the change to occur since this also improves people’s morale. Step 7: Building on the change Kotter argues that a real change is the change that runs deep. Its worth to note that after achieving the first short term goal, the second short term goal should have improvements and so is the sequential goals. After confirming a new route between Sydney and Perth, Virgin Blues company goes ahead to reveal a partnership with SkyWest to fly to regional routes. Step 8: Incorporate the changes into the organization culture To make the new changes to stick, incorporate these changes in the day to day running of the company. Virgin’s Blues changes are directed to attracting and maintaining the business travelers so that they choose the company as their choice for travelling. While hiring new staff they should be well orientated with the new changes, new leaders should be recruited as agents of change to replace the old ones so that this legacy is carried on and recognize all the people who have made changes in the organization a reality. Challenges of change In the process of changes in an organization, there are so many challenges to be faced and at the same time to be solved. They are various factors that can become an obstacle to change implementation within organizations and in particular Virgin Blue for this case. Resistance to change The most challenging aspect of change is the resistance of the people to change. Resistance delays change. Resistance is a defense mechanism for change. Richard (2010) states that if the people involved do not accept change, then this process is doomed to fail. Factors that may cause resistance in Virgin’s Blue Company a). Psychological factors: Workers may resist change because of the emotional turmoil that the change can come with .Virgin’s change seems that there so much transformations to take place. There will be increased workload as two lounges are being built. Could it be that there will be more qualified personnel to be employed and some exits of others? b). Social factors: Strebel (2005) states that human beings are social species. Workmates in organizations forms informal relationships, which holds them together. If these informal groups are interfered with the people involved may resist change. In the Company, there might be reshuffles or deployment from one department to another. c).Economic factors: The workers may feel that with the changes on board, there may be a decrease in salaries with increased workload. When these changes become a success of the company, there will be more customers as opposed to the current state where the leisure customers are the only customers (Greiner, 2007). d). Threat of comfort: Some changes can make employees life difficult. Many employees have adopted ways of performing their duties but with emergence of new changes, this may cause a shift of status quo to complicated ways of performing duties. e). Lack of conviction that change is needed. This occurs when there is no clear communication as to why change is needed, the changes to take place and who is to implement change. f). Lack of clarity as to what is needed. Employees will resist change if the change does not comprise individual benefits. Lack of prioritizing the resources and projects Change comes together with many projects to be accomplished. With these projects, there is need for resources to be put in place. Virgin’s Blue organization has some projects to include new uniforms, building some lounges, there are new products on board and also replacing the narrow body jets. They ought to prioritize on which project is more immediate than the other and allocate the necessary resources (Greiner, 2007). Failure to involve the staff in the change The people to whom change is occurring ought to be consulted and involved. Change does not involve the company but it involves the people who are to implement the change. The staffs who work there will implement most of the changes in Virgin’s company. If they are not involved, they will view change as if it belongs to the management and not to them (Greiner, 2007). Failure to address people’s fears and anxieties through the way to change There comes a state of demoralization and uncertainty by the workers of what is to happen when change is within. With the expansion of the company, with extra routes for the airline and with increased workload will there be added benefits for workers? Will there be reshuffles? People generally have a sense of fear and anxiety of what is to happen while there are new changes in place. Ineffective leadership For an effective change to take place, a strong leadership is needed. Whenever a leader’s actions mismatches with what he says the employees become very keen and interprets it as no change is to take place. Anderson & Anderson (2001 p.141.) states that leaders play very important roles in the change of an organization because they lead while the rest of the staff follows by the example set. Conclusion There is no shortcut for organizations but to change. Dolphy & Jeffrey (2005) argues that globalization has increased more markets and opportunities to offer more growth in profits and revenue. Many organizations and companies will opt to change because an opportunity has risen. Virgin Blue’s Company has opted to make changes because an opportunity to incorporate the business travelers into the airline has risen. Virgin’s company is changing in the following ways: changing staff uniforms, introducing new products into the market, replacing the uneconomical airlines and building more lounges and also changing their company name. The probable reasons as to why Virgins Company decided to go into changes are; market pressures, strategy refocusing and economic reasons. In the process of making change, the company ought to use the kotters change model in the planning, implementation and sustaining the change. The steps are establishing a sense of urgency, creating a leading team, developing a vision for change, communication of the vision, removing obstacles, creation of short term goals, building on the change and incorporating the change into the organizations culture. While incorporating these changes into the company there is a very high likelihood that there will be challenges. Virgins Company ought to come into terms with these challenges and address them timely to avoid delays in the change implementations (Anderson & Anderson, 2001). The challenges that the company might face are: Ineffective leadership, resistance to change, inability to prioritize projects and resources, failure to address people’s fears and anxieties and failure to involve people in the change itself. Recommendations To enable a smooth running of Virgin’s changes of the company, the management ought to prepare for challenges and know the best ways to address these shortcomings. The organization needs to; Create an environment that is trusting, supportive to the employees and one that is employee oriented (Anderson & Anderson, 2001). Effective change communication both from top to bottom and vice versa Building a strong leadership where their words match their actions. Give rewards where credit is due. Involve people in the process of change References Anderson, D & Anderson, L 2001, Beyond Change Management: Advanced Strategies for Today’s Transformational Leaders. San Francisco: Jossey-Bass/Pfeiffe Dolphy, A & Jeffrey, G 2005,organization and transformation and e-business implementation, Journal of organization change management vol. 18 no.2 pp. 97 Greiner, L. E. 2007, Patterns of organization change. Harvard Business Review, 46(9), 119- 130. John, W 2012, Causes of Organizational Change. Viewed 3rd May 2012 from http://www.cliffsnotes.com/study_guide/topic Kotter, J 2007, Leading Change – Why Transformation Efforts Fail, Harvard Business Review, Vol.1 pp 34 Patrick, E & Linda, K 2003, Managing organizational change, U.S.A. praeger publishers. Robert, A 2008, Change Management: A Guide to Effective Implementation, London, Sage publications. Schneider, D 2006, "It's a Leader's Duty to Manage Change." From http://ezinearticles.com/?Managing-Change---Challenges,-Processes-and-Strategies Strebel, P 2005, Why Do Employees Resist Change?, Harvard Business Review, 74, 86 - 92. Watzlawick, P et al 2006, Change: Principles of Problem Formation and Problem Resolution., New York, Norton. Read More